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351 U.S. 56
76 S.Ct. 578
100 L.Ed. 934
DIXIE CARRIERS, Inc., Coyle Lines, Incorporated, American Barge Line Company and Federal Barge Lines, Inc., Appellants,v.UNITED STATES of America, Interstate Commerce Commission, et al.
No. 233.
Argued March 27, 1956.
Decided April 23, 1956.
Mr.Nuel D. Belnap, Chicago, Ill., for appellants.
Mr. Daniel M. Friedman, Washington, D.C., for United States.
Mr. Samuel R. Howell, Washington, D.C., for I.C.C.
Mr. John A. Daily, Chicago, Ill., for N.Y.C.R.R. Co. et al.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
Sulphur mined near Galveston, Texas, can be shipped to Danville, Illinois, either by rail or by barge and rail. If the sulphur goes by barge and rail, it is transported up the Mississippi via New Orleans to East St. Louis and then by rail to Danville. The total charge for that movement is $9.77 per ton.1 The total of the various local rates for all-rail shipments from the mines to Danville is $11.68. But the railroads have established a joint all-rail rate2 of $9.184 which is lower than both the combination all-rail rate and the combination rail-barge rate.
2
Appellants, who are water carriers, requested the competing railroads to establish a joint rail-barge rate of $7.67 on sulphur from Galveston to Danville. The railroads refused. Appellants thereupon filed a complaint with the Interstate Commerce Commission alleging that the existing rail-barge rates on sulphur were excessive and unreasonable, that through rail-barge routes and joint rates with reasonable differentials below the all-rail rates should be established, and that the refusal of the railroads to establish such joint rates discriminated against the barges as connecting carriers in violation of the Interstate Commerce Act, as amended by the Transportation Act of 1940.3 Appellants requested the Commission to establish a through rail-barge route and a joint rate and suggested that the joint rate be fixed at $7.67. Appellants proposed that the Danville railroads receive $2.26 as a division of that rate, calculated to be the same as they receive from the all-rail rate from Galveston to Danville. Under the proposed rate, the cost of rail-barge shipments from the mines to Danville would be $9.17 as compared with the all-rail rate of $9.184.
3
A Division of the Commission dismissed the complaint, one Commissioner dissenting. 287 I.C.C. 403. The Commission affirmed the Division, three Commissioners dissenting. 291 I.C.C. 422. A three-judge District Court sustained the Commission. 129 F.Supp. 28. The case is here on appeal, 28 U.S.C. §§ 1253, 2101(b), 2325, 28 U.S.C.A. §§ 1253, 2101(b), 2325.
4
Section 3(4) of the Act provides that 'All carriers subject to the provisions of this part * * * shall not discriminate in their rates, fares, and charges between connecting lines * * *.' Section 3(4) defines 'connecting line' as including 'any common carrier by water subject to Part III.' Appellants are common carriers by water within that definition. They maintain that it is unlawful under § 3(4) of the Act for a railroad to refuse to join in through routes and joint rates with a water carrier when it has already joined in such routes and rates with a connecting rail line. They further maintain that the power of the Commission under § 307(d)4 to establish through routes and joint rates should have been exercised here.
5
We had a closely related question before us in Interstate Commerce Commission v. Mechling, 330 U.S. 567, 67 S.Ct. 894, 91 L.Ed. 1102. In that case we invalidated an order of the Commission which approved higher rail rates for the transportation of grain east of Chicago if it had arrived in Chicago by barge, rather than by rail. We reviewed the history of the Transportation Act of 1940 and concluded that that Act 'unequivocally required the Commission to fix rates which would preserve for shippers the inherent advantages of barge transportation: lower cost of equipment, operation, and therefore service.' Id., 330 U.S. at page 575, 67 S.Ct. at page 898. We held that the discrimination which was outlawed applied to through rates as well as to ordinary rates.
6
The Mechling case involved an attempt to deprive water transportation of one of its 'inherent advantages,' as that phrase is used in the preamble of the 1940 Act, 49 U.S.C.A. note preceding section 1, by increasing the cost of barge service. The Commission's present decision achieves the same result through the device of a joint rate allowed carriers by rail but denied carriers by water. It was recognized in the debates on the bill that became the Transportation Act of 1940 that manipulation of rail rates downward might deprive water carriers of their 'inherent advantages' and therefore violate the Act.5 It was emphasized that one of the evils to be remedied was cutthroat competition, whereby strong rail carriers would reduce their rates, putting water carriers out of business.6 There was recognition that for shippers to get the benefit of the 'inherent advantages' of water transportation there frequently would have to be joint rail-barge rates.7 Barge transportation frequently covers only one segment of the journey to market. The failure of the railroads to establish nondiscriminatory joint rates with barges might, therefore, seriously impair the development of barge service as a vital component of our national transportation system. Section 3 outlaws discrimination in all its forms. See State of New York v. United States, 331 U.S. 284, 296, 67 S.Ct. 1207, 1213, 91 L.Ed. 1492. Where there is discrimination by the use of a joint rate to favor rail carriers over carriers by water and to deprive the latter of their 'inherent advantages,' the Commission has a duty to end it under § 307(d). That subsection8 makes it mandatory for the Commission to establish through routes and joint rates 'whenever deemed by it to be necessary or desirable in the public interest.' The public interest, as defined in the Act, is the guide to the Commission's action. McLean Trucking Co. v. United States, 321 U.S. 67, 82, 64 S.Ct. 370, 378, 88 L.Ed. 544. The policy is to preserve all the 'inherent advantages' of the water carriers.9 That means that a joint barge-rail rate must be established when it appears, as here, that a joint rail rate discriminates against the water carriers. Otherwise a manipulated rate structure will take the business from the water carriers. In absence of the joint all-rail rate, the rail-barge combination rate for sulphur would be $1.91 per ton less than the all-rail combination rate between the same points. That differential reflects the lower cost of the barge segment of the journey. It is at once lost to shippers when joint rates are allowed rail carriers and withheld from the water carriers. To hold otherwise would be to sanction a rate structure which, through the use of discriminatory joint rates, denies shippers the 'inherent advantages' of water transportation.
7
Reversed.
1
The charge consists of rail and loading charges of $1.50 at Galveston, the barge rate of $5.32 to East St. Louis, and the local rail rate of $2.95 from East St. Louis to Danville.
2
For a discussion of joint rates see St. Louis Southwestern R. Co. v. United States, 245 U.S. 136, 139, note 2, 38 S.Ct. 49, 50, 62 L.Ed. 199; United States v. Great Northern Ry. Co., 343 U.S. 562, 72 S.Ct. 985, 96 L.Ed. 1142.
3
24 Stat. 379, as amended 54 Stat. 898, 49 U.S.C. § 1, 49 U.S.C.A. § 1.
4
Section 307(d) provides:
'The Commission may, and it shall whenever deemed by it to be necessary or desirable in the public interest, after full hearing upon complaint or upon its own initiative without a complaint, establish through routes, joint classifications, and joint rates, fares, or charges, applicable to the transportation of passengers or property by common carriers by water, or by such carriers and carriers by railroad, or the maxima or minima, or maxima and minima, to be charged, and the divisions of such rates, fares, or charges as hereinafter provided, and the terms and conditions under which such through routes shall be operated. In the case of a through route, where one of the carriers is a common carrier by water, the Commission shall prescribe such reasonable differentials as it may find to be justified between all-rail rates and the joint rates in connection with such common carrier by water. * * *' 49 U.S.C.A. § 907(d).
5
There was the following colloquy during the debate in the Senate between Senator Wheeler who was in charge of the bill and Senator Norris (84 Cong.Rec. 5874):
'Mr. Norris. Suppose, however, this bill should become a law, and an article of freight were to be transported which admittedly could be carried by water better than by railroad, and suppose the railroad should undertake to reduce its rate down to the water rate: Would there be anything in the law to prevent the railroad from doing that?
'Mr. Wheeler. Of course there would be.
'Mr. Norris. Disastrous rates can be brought about by reducing them just as well as by increasing them, as a matter of fact.
'Mr. Wheeler. Exactly.
'Mr. Norris. And the water carrier ought to be protected on the freight that ought to be carried by water rather than on the railroad.
'Mr. Wheeler. It would be absolutely protected under this measure.
'Mr. Norris. That is what I want to see done.
'Mr. Wheeler. There is not any question about it. Under the rate-making provision and under the other provisions I have read, there is not any question about it.'
6
Id., 5877.
7
Id., 5875.
8
Note 4, supra.
9
The Division of the Commission thought that regard for the 'inherent advantages' of water transportation did not require it 'to force rail carriers, where they maintain a depressed rate to meet water competition, to further depress their earnings on the traffic in order to favor that same form of competition.' 287 I.C.C., at 407. But part of that critical 'depressed rate'—and the one most relevant here—is the $2.26 of the joint all-rail rate received by the East St. Louis-Danville rail carrier. For this same haul, the East St. Louis-Danville rail carrier receives $2.95 on the barge-rail rate. Yet on that haul the railroad has no competition from the water carriers.
| 78
|
351 U.S. 49
76 S.Ct. 574
100 L.Ed. 917
EAST TEXAS MOTOR FREIGHT LINES, Inc., et al., Appellants,v.FROZEN FOOD EXPRESS, Secretary or Agriculture, et al. INTERSTATE COMMERCE COMMISSION, Appellant, v. FROZEN FOOD EXPRESS et al. AKRON, CANTON AND YOUNGSTOWN R. CO. et al., Appellants, v. FROZEN FOOD EXPRESS et al.
Nos. 162—164.
Argued and Submitted March 7, 1956.
Decided April 23, 1956.
Mr.Robert W. Ginnane, Washington, D.C., for I.C.C.
Mr. David G. Macdonald, Washington, D.C., for East Texas Motor Freight Lines, et al.
Mr. Carl L. Phinney, Dallas, Tex., for Frozen Food Express.
Mr. Charles H. Weston, Washington, D.C., for U.S. and Secy. of agriculture.
Messrs. Charles P. Reynolds, Washington, D.C., and Carl Helmetag, Jr., Philadelphia, Pa., for appellant Railroads.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
Three motor common carriers filed a complaint with the Interstate Commerce Commission under § 204(c) of Part II of the Interstate Commerce Act, 49 Stat. 547, as amended, 49 U.S.C. § 304(c), 49 U.S.C.A. § 304(c), alleging that Frozen Food Express, a common carrier by motor vehicle, was and had been transporting fresh and frozen meats and fresh and frozen dressed poultry in interstate commerce without a certificate of convenience and necessity from the Commission which covers those commodities. The complaint prayed for a cease and desist order. Frozen Food Express admitted that it was and had been so transporting the named commodities but asserted in defense that those operations were within the exemption of § 203(b)(6).1
2
The Commission found that Frozen Food Express had been performing unauthorized operations and that fresh and frozen meats and fresh and frozen dressed poultry were not within the exemption of § 203(b)(6). 62 M.C.C. 646. Accordingly it ordered Frozen Food Express to cease and desist from engaging in these operations. Frozen Food Express brought suit before a three-judge District Court, 28 U.S.C. § 2325, 28 U.S.C.A. § 2325, to set the Commission's order aside, 28 U.S.C. § 1336, 28 U.S.C.A. § 1336; 49 Stat. 550, as amended, 49 U.S.C. § 305(g), 49 U.S.C.A. § 305(g); 60 Stat. 243, 5 U.S.C. § 1009, 5 U.S.C.A. § 1009. The answer of the United States and the complaint in intervention filed by the Secretary of Agriculture supported the position of Frozen Food Express. The original complainants before the Commission and other interested carriers and carrier associations intervened in support of the Commission. The District Court sustained the Commission's conclusion that fresh and frozen meats are nonexempt commodities. No appeal was taken from that holding. The District Court held that fresh and frozen dressed poultry are exempt commodities under § 203(b)(6) and restrained the Commission from enforcing its cease and desist order as respects those products. 128 F.Supp. 374. The cases are here by appeal. 28 U.S.C. §§ 1253, 2101(b), 28 U.S.C.A. §§ 1253, 2101(b).
3
We agree with the District Court that the Commission's ruling does not square with the statute. The exemption of motor vehicles carrying 'agricultural (including horticultural) commodities (not including manufactured products thereof)' was designed to preserve for the farmers the advantage of low-cost motor transportation. See especially 79 Cong.Rec. 12217. The victory in the Congress for the exemption was recognition that the price which the farmer obtains for his products is greatly affected by the cost of transporting them to the consuming market in their raw state or after they have become marketable by incidental processing.
4
The history of the words 'agricultural * * * commodities (not including manufactured products thereof)' contained in § 203(b)(6) supports that conclusion. The bill as it came to the floor of the House from the Interstate and Foreign Commerce Committee (79 Cong.Rec. 12204) exempted 'motor vehicles used exclusively in carrying livestock or unprocessed agricultural products.' Id., 12220. Mr. Pettengill for the Committee offered an amendment which substituted for the words 'unprocessed agricultural products' the phrase 'agricultural commodities not including manufactured products thereof.' That amendment was agreed to after the following colloquy:
5
'Mr. Pettengill. Mr. Chairman, we have heard a good deal of discussion this afternoon as to what is a processed agricultural product, whether that would include pasteurized milk or ginned cotton. It was not the intent of the committee that it should include those products. Therefore, to meet the views of many Members we thought we would strike out the word 'unprocessed' and make it apply only to manufactured products.
6
'Mr. Whittington. In other words, under the amendment to the committee amendment, cotton in bales and cottonseed transported from the ginneries to the market or to a public warehouse would be exempt, whereas they might not be exempt if the language remained, because ginning is sometimes synonymous with processing.
7
'Mr. Pettengill. That is correct.'
8
It is plain from this change that the exemption of 'agricultural commodities' was considerably broadened by making clear that the exemption was lost not by incidental or preliminary processing but by manufacturing.2 Killing, dressing, and freezing a chicken is certainly a change in the commodity. But it is no more drastic a change than the change which takes place in milk from pasteurizing, homogenizing, adding vitamin concentrates, standardizing, and bottling. Yet the Commission agrees that milk so processed is not a 'manufactured' product, but falls within the meaning of the 'agricultural' exemption. 52 M.C.C. 511, 551. The Commission also agrees that ginned cotton and cottonseed are exempt. Id., 523—524. But there is hardly less difference between cotton in the field and cotton at the gin or in the bale or between cottonseed in the field and cottonseed at the gin, than between a chicken in the pen and one that is dressed. The ginned and baled cotton and the cottonseed, as well as the dressed chicken, have gone through a processing stage. But neither has been 'manufactured' in the normal sense of the word. The Court in Anheuser-Busch Brewing Ass'n v. United States, 207 U.S. 556, 562, 28 S.Ct. 204, 206, 52 L.Ed. 336, in a case arising under the tariff laws, said,
9
'* * * Manufacture implies a change, but every change is not manufacture, and yet every change in an article is the result of treatment, labor, and manipulation. But something more is necessary, as set forth and illustrated in Hartranft v. Wiegmann, 121 U.S. 609, 7 S.Ct. 1240, 30 L.Ed. 1012. There must be transformation; a new and different article must emerge, 'having a distinctive name, character, or use." In that case imported corks were made ready for use in beer bottles by stamping, by removal of dust, meal, bugs, and worms, by washing and steaming to remove tannin and to increase elasticity, and by drying. Plainly, the corks were processed. But the Court held they had not been manufactured within the drawback provision of the tariff laws. And see Hartranft v. Wiegmann, 121 U.S. 609, 615, 7 S.Ct. 1240, 1243, 30 L.Ed. 1012; United States v. Dudley, 174 U.S. 670, 19 S.Ct. 801, 43 L.Ed. 1129.
10
A chicken that has been killed and dressed is still a chicken. Removal of its feathers and entrails has made it ready for market. But we cannot conclude that this processing which merely makes the chicken marketable turns it into a 'manufactured' commodity.3
11
At some point processing and manufacturing will merge. But where the commodity retains a continuing substantial identity through the processing stage we cannot say that it has been 'manufactured' within the meaning of § 203(b)(6).
12
The Commission is the expert in the field of transportation. And its judgment is entitled to great deference because of its familiarity with the conditions in the industry which it regulates. American Trucking Ass'ns v. United States, 344 U.S. 298, 310, 73 S.Ct. 307, 314, 97 L.Ed. 337. But Congress has placed limits on its statutory powers; and our duty on judicial review is to determine those limits. See Social Security Board v. Nierotko, 327 U.S. 358, 66 S.Ct. 637, 90 L.Ed. 718. Those limits would be passed here if the Commission were permitted to expand 'manufactured' to include such incidental processing as is involved in dressing and freezing a chicken.
13
Affirmed.
14
Mr. Justice BURTON, whom Mr. Justice FRANKFURTER, Mr. Justice MINTON and Mr. Justice HARLAN join, dissenting.
15
For the reasons given by the Interstate Commerce Commission, 52 M.C.C. 511, 62 M.C.C. 646, and its administrative practice of over 15 years, I would sustain its interpretation of the Act to the effect that fresh and frozen dressed poultry, like fresh and frozen dressed meats, are not entitled to exemption as agricultural commodities. No appeal has been taken from that part of the judgment which held valid the Commission's determination that fresh and frozen dressed meats are products manufactured from agricultural commodities. The Commission's like treatment of poultry is not arbitrary or unreasonable. On the contrary, there was much evidence before the Commission which clearly supported its decision. Consequently, we should accord that decision the weight ordinarily given to informed administrative action. We cannot say that the order of the Commission, which held that there is no significant distinction between the two, is not an allowable judgment.
16
'Such determinations (of fact by the Shipping Board or Interstate Commerce Commission as a basis for administrative orders) will not be set aside by courts if there is evidence to support them. Even though, upon a consideration of all the evidence, a court might reach a different conclusion, it is not authorized to substitute its own for the administrative judgment.' Swayne & Hoyt, Ltd. v. United States, 300 U.S. 297, 304, 57 S.Ct. 478, 481, 81 L.Ed. 659. See also, Federal Communications Commission v. WOKO, Inc., 329 U.S. 223, 229, 67 S.Ct. 213, 216, 91 L.Ed. 204; United States v. Pierce Auto Freight Lines, Inc., 327 U.S. 515, 535—536, 66 S.Ct. 687, 697 698, 90 L.Ed. 821; Barrett Line, Inc., v. United States, 326 U.S. 179, 199, 65 S.Ct. 1504, 1513, 89 L.Ed. 2128.
1
Sec. 203(b)(6) provides:
'Nothing in this part, except the provisions of section 204 relative to qualifications and maximum hours of service of employees and safety of operation or standards of equipment shall be construed to include * * * motor vehicles used in carrying property consisting of ordinary livestock, fish (including shell fish), or agricultural (including horticultural) commodities (not including manufactured products thereof), if such motor vehicles are not used in carrying any other property, or passengers, for compensation * * *.'
2
Two more changes were made in the agricultural exemption clause before the bill reached final form. The words 'fish, including shellfish,' were added after the word 'livestock' (79 Cong.Rec. 12220), and the exemption was strengthened by making it 'absolute rather than discretionary' with the Interstate Commerce Commission. Id., at 12225—12226.
As originally enacted in 1935, § 203(b)(6) exempted motor vehicles 'used exclusively' in carrying agricultural commodities. In 1938 the word 'exclusively' was deleted and the following language was added at the end of the clause: "if such motor vehicles are not used in carrying any other property, or passengers, for compensation." 52 Stat. 1237. In 1940 the word 'ordinary' was inserted before the word 'livestock,' making the exemption applicable to 'ordinary livestock.' 54 Stat. 921. Finally, in 1952, the words 'agricultural commodities' were broadened to 'agricultural (including horticultural) commodities.' 66 Stat. 479.
3
The fact that most poultry is sold alive and is not killed and processed by the grower is not controlling. For § 203(b)(6) exempts carriers transporting 'agricultural commodities' unless those products are 'manufactured.' The exemption is concerned with the stage of the processing, not with the person who does it.
| 78
|
351 U.S. 1
76 S.Ct. 611
100 L.Ed. 883
Clark SQUIRE, Collector of Internal Revenue for the District of Washington, Petitioner,v.Horton CAPOEMAN and Emma Capoeman, his wife.
No. 134.
Argued Jan. 19, 1956.
Decided April 23, 1956.
Mr.Charles F. Barber, Washington, D.C., for petitioner.
Mr. John W. Bragun, Washington, D.C., for respondent.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
The question presented is whether the proceeds of the sale by the United States Government of standing timber on allotted lands on the Quinaielt Indian Reservation may be made subject to capitalgains tax, consistently with applicable treaty and statutory provisions and the Government's role as respondents' trustee and guardian.
2
When white men first came to the Olympic Peninsula, in what is now the State of Washington, they found the Quinaielt Tribe of Indians and their neighboring allied tribes occupying a tract of country lying between the Coast Range and the Pacific Ocean. This vast tract, with the exception of a small portion reserved for their exclusive use, was ceded by the Quinaielts and their neighbors to the United States in exchange for protection and tutelage by the treaty of July 1, 1855, and January 25, 1856, 12 Stat. 971. According to this treaty, the Quinaielts were to have exclusive use of their reservation 'and no white man shall be permitted to reside thereon without permission of the tribe * * *.' Article II. Years later, Congress passed the General Allotment Act of 1887.1 Thereunder, Indians were to be allotted lands on their reservations not to exceed 160 acres of grazing land or 80 acres of agricultural land,2 and 25 years after allotment the allottees were to receive the lands discharged of the trust under which the United States had theretofore held them, and to obtain a patent 'in fee, discharged of said trust and free of all charge or incumbrance whatsoever',3 though the President might extend the period.4
3
Respondents, husband and wife, were born on the reservation, and are described by the Government as full-blood, noncompetent Quinaielt Indians. They have lived on the reservation all their lives with the exception of the time served by respondent husband in the Armed Forces of the United States during World War II.
4
Pursuant to the treaty and under the General Allotment Act of 1887, respondent husband was allotted from the treaty-guaranteed reservation 93.25 acres and received a trust patent5 therefor dated October 1, 1907.6 During the tax year here in question, the fee title to this land was still held by the United States in trust for him, and was not subject to alienation or encumbrance by him, except with the consent of the United States Government, which consent had never been given. The land was forest land, covered by coniferous trees from one hundred years to several hundred years old. It was not adaptable to agricultural purposes, and was of little value after the timber was cut.
5
In the year 1943, the Bureau of Indian Affairs of the United States Department of the Interior entered into a contract of sale for the standing timber on respondent's allotted land for the total price of $15,080.80. The Government received the sum of $8,418.28 on behalf of respondent in that year.7
6
Upon demand of petitioner, Collector of Internal Revenue for the District of Washington, respondents filed a joint income tax return on October 10, 1947, for the tax year 1943, reporting long-term capital gain from the sale of the timber in that year. Simultaneously, they paid the taxes shown due. Thereafter, they filed a timely claim for refund of the taxes paid and contended that the proceeds from the sale of timber from the allotted land were not subject to federal income taxation because such taxation would be in violation of the provisions of the Quinaielt Treaty, the trust patent, and the General Allotment Act. The claim for refund was denied, and this action was instituted. The District Court found that the tax had been unlawfully collected and ordered the refund. 110 F.Supp. 924. The Court of Appeals, agreeing with the District Court but recognizing a conflict between this case and the decision of the Tenth Circuit in the case of Jones v. Taunah, 186 F.2d 445, affirmed. 9 Cir., 220 F.2d 349. Because of the apparent conflict, we granted certiorari. 350 U.S. 816, 76 S.Ct. 58.
7
The Government urges us to view this case as an ordinary tax case without regard to the treaty, relevant statutes, congressional policy concerning Indians, or the guardian-ward relationship between the United States and these particular Indians. It argues:
8
'As citizens of the United States they are taxable under the broad provisions of Sections 11 and 22(a) of the Internal Revenue Code of 1939, which imposes a tax on the net income of every individual, derived from any source whatever. There is no exemption from tax in the Quinaielt Treaty, the General Allotment Act, the taxing statute, or in any other legislation dealing with taxpayers' affairs. * * *
9
'Even if it be assumed that the United States would be prohibited from imposing a direct tax on the allotted land held in trust for the taxpayers, there would, nevertheless, be no prohibition against a federal tax on the income derived from the land, since a tax on such income is not the same as the tax on the source of the income, the land.'8
10
We agree with the Government that Indians are citizens and that in ordinary affairs of life, not governed by treaties or remedial legislation, they are subject to the payment of income taxes as are other citizens. We also agree that, to be valid, exemptions to tax laws should be clearly expressed. But we cannot agree that taxability of respondents in these circumstances is unaffected by the treaty, the trust patent or the Allotment Act.
11
The courts below held that imposition of the tax here in question is inconsistent with the Government's promise to transfer the fee 'free of all charge or incumbrance whatsoever.' Although this statutory provision is not expressly couched in terms of nontaxability, this Court has said that
12
'Doubtful expressions are to be resolved in favor of the weak and defenseless people who are the wards of the nation, dependent upon its protection and good faith. Hence, in the words of Chief Justice Marshall: 'The language used in treaties with the Indians should never be construed to their prejudice. If words be made use of, which are susceptible of a more extended meaning than their plain import, as connected with the tenor of the treaty, they should be considered as used only in the latter sense.' Worcester v. State of Georgia, 6 Pet. 515, 582, 8 L.Ed. 483.' Carpenter v. Shaw, 280 U.S. 363, 367, 50 S.Ct. 121, 122, 74 L.Ed. 478.
13
Thus, the general words 'charge or incumbrance' might well be sufficient to include taxation. But Congress, in an amendment to the General Allotment Act, gave additional force to respondents' position. Section 6 of that Act was amended to include a proviso—
14
'That the Secretary of the Interior may, in his discretion, and he is authorized, whenever he shall be satisfied that any Indian allottee is competent and capable of managing his or her affairs at any time to cause to be issued to such allottee a patent in fee simple, and thereafter all restrictions as to sale, incumbrance, or taxation of said land shall be removed and said land shall not be liable to the satisfaction of any debt contracted prior to the issuing of such patent * * *.'9
15
The Government argues that this amendment was directed solely at permitting state and local taxation after a transfer in fee, but there is no indication in the legislative history of the amendment that it was to be so limited.10 The fact that this amendment antedated the federal income tax by 10 years also seems irrelevant. The literal language of the proviso evinces a congressional intent to subject an Indian allotment to all taxes only after a patent in fee is issued to the allottee. This, in turn, implies that, until such time as the patent is issued, the allotment shall be free from all taxes, both those in being and those which might in the future be enacted.11
16
The first opinion of an Attorney General touching on this question seemed to construe the language of the amendment to Section 6 as exempting from the income tax income derived from restricted allotments.12 And even without such a clear statutory basis for exemption, a later Attorney General advised that he was—
17
'(U)nable, by implication, to impute to Congress under the broad language of our Internal Revenue Acts an intent to impose a tax for the benefit of the Federal Government on income derived from the restricted property of these wards of the nation; property the management and control of which rests largely in the hands of officers of the Government charged by law with the responsibility and duty of protecting the interests and welfare of these dependent people. In other words, it is not lightly to be assumed that Congress intended to tax the ward for the benefit of the guardian.'13
18
Two of these opinions were published as Treasury Decisions.14 On the basis of these opinions and decisions, and a series of district and circuit court decisions, it was said by Felix S. Cohen, an acknowledged expert in Indian law, that 'It is clear that the exemption accorded tribal and restricted Indian lands extends to the income derived directly therefrom.'15 These relatively contemporaneous official and unofficial writings are entitled to consideration. The Government makes much of a subsequent Attorney General's opinion,16 which expressly overruled an earlier opinion,17 on the authority of Superintendent of Five Civilized Tribes, etc. v. Commissioner of Internal Revenue, 295 U.S. 418, 55 S.Ct. 820, 79 L.Ed. 1517.
19
That case is distinguishable from the case at hand. It involved what the Court characterized as 'income derived from investment of surplus income from land',18 or income on income, which Cohen termed 'reinvestment income.' The purpose of the allotment system was to protect the Indians' interest and 'to prepare the Indians to take their place as independent, qualified members of the modern body politic.' Board of Commissioners, etc. v. Seber, 318 U.S. 705, 715, 63 S.Ct. 920, 926, 87 L.Ed. 1094. To this end, it is necessary to preserve the trust and income derived directly therefrom, but it is not necessary to exempt reinvestment income from tax burdens. It is noteworthy that the Superintendent case did not involve an attempt to tax the land 'surplus.'19
20
The wisdom of the congressional exemption from tax embodied in Section 6 of the General Allotment Act is manifested by the facts of the instant case. Respondent's timber constitutes the major value of his allotted land. The Government determines the conditions under which the cutting is made.20 Once logged off, the land is of little value.21 The land no longer serves the purpose for which it was by treaty set aside to his ancestors, and for which it was allotted to him. It can no longer be adequate to his needs and serve the purpose of bringing him finally to a state of competency and independence. Unless the proceeds of the timber sale are preserved for respondent, he cannot go forward when declared competent with the necessary chance of economic survival in competition with others. This chance is guaranteed by the tax exemption afforded by the General Allotment Act, and the solemn undertaking in the patent. It is unreasonable to infer that, in enacting the income tax law, Congress intended to limit or undermine the Government's undertaking. To tax respondent under these circumstances would, in the words of the court below, be 'at the least, a sorry breach of faith with these Indians.'22
21
The judgment of the Court of Appeals is affirmed.
22
Affirmed.
23
Mr. Justice REED, dissenting.
24
My view is that the sale price of the timber in excess of its market value on March 1, 1913, was a capital gain, subject to federal income tax. Jones v. Taunah, 10 Cir., 186 F.2d 445. Cf. Choteau v. Burnet, 283 U.S. 691, 51 S.Ct. 598, 75 L.Ed. 1353; Superintendent of Five Civilized Tribes, etc. v. Commissioner of Internal Revenue, 295 U.S. 418, 55 S.Ct. 820, 79 L.Ed. 1517. The gain is taxable income like the value of annual crops.
25
Mr. Justice HARLAN took no part in the consideration or decision of this case.
1
24 Stat. 388, 25 U.S.C. § 331 et seq., 25 U.S.C.A. § 331 et seq.
2
25 U.S.C. § 331, 25 U.S.C.A. § 331.
3
Id., § 348.
4
Ibid. The trust period here involved has regularly been extended by Executive Order. See note following 25 U.S.C. § 348, 25 U.S.C.A. § 348, and see 25 U.S.C. § 462, 25 U.S.C.A. § 462, which provides: 'The existing periods of trust placed upon any Indian lands and any restriction on alienation thereof are hereby extended and continued until otherwise directed by Congress.'
5
The term 'patent' inadequately describes respondent's interest. 'Congress * * * was careful to avoid investing the allottee with the title in the first instance, and directed that there should be issued to him what * * * is in reality an allotment certificate * * *.' Monson v. Simonson, 231 U.S. 341, 345, 34 S.Ct. 71, 72, 58 L.Ed. 260.
6
In pertinent part, the patent provides:
'Now know ye, That the United States of America, in consideration of the premises, has allotted, and by these presents does allot, unto the said Horton Capoeman, the land above described, and hereby declares that it does and will hold the land thus allotted (subject to all statutory provisions and restrictions) for the period of twenty-five years, in trust for the sole use and benefit of the said Indian, and that at the expiration of said period the United States will convey the same by patent to said Indian, in fee, discharged of said trust and free of all charge or incumbrance whatsoever, * * *.'
7
This sale seems to have followed a pattern generally adopted by the Government in selling timber from Indian allotments. Huge areas of forest are put up for competitive bids by lumber companies. These tracts include the tribal forest lands and individual allotments, with the consent of tribal councils and individual allottees. The successful bidder is required to make an immediate advance payment of a large proportion of the estimated value of the lumber in the tract. Since as much as 640 million board feet have been sold at one time, this requirement makes it economically infeasible for any but the largest companies to submit bids. The uncertainties of such large scale operations, which are to be carried on over 25- or 30-year periods, coupled with local quality and accessibility variables, has resulted in substantially lower than prevailing market bids. In some instances, the return to other sellers of comparable timber was two or three times that received by the Indians. See Transcript of November 28, 1955, Joint Hearing of Subcommittee on Legislative Oversight Function of the Senate Committee on Interior and Insular Affairs and of Subcommittee on Public Works and Resources of the House Committee on Government Operations, 2151—2217, and passim.
8
Brief for Petitioner, pp. 7—8.
9
25 U.S.C. § 349, 25 U.S.C.A. § 349.
10
See S.Rep. No. 1998, 59th Cong., 1st Sess.; H.R.Rep. No. 1558, 59th Cong., 1st Sess.
11
This provision was relied upon by Chief Judge Phillips, dissenting in Jones v. Taunah, 10 Cir., 186 F.2d 445, 449.
12
34 Op.Atty.Gen. 275, 281 (1924). And see id., 302 (1924).
13
Id., 439, 445 (1925). This ruling was followed in 35 Op.Atty.Gen. 1 (1925). And cf. id., 107 (1926).
14
T.D. 3570, III—1 Cum.Bull. 85 (1924); T.D. 3754, IV—2 Cum.Bull. 37 (1925).
15
Cohen, Handbook of Federal Indian Law, 265. He distinguished cases permitting the imposition of income taxes upon income derived from unrestricted lands, and upon reinvestment income. Id., at 265—266. Mr. Cohen was Chairman of the Department of Interior Board of Appeals, and Assistant Solicitor of the Department. The Handbook has a foreword by Harold L. Ickes, then Secretary of the Interior, and was printed by the United States Government Printing Office.
16
39 Op.Atty.Gen. 107 (1937).
17
34 id., 439.
18
295 U.S. at page 421, 55 S.Ct. at page 822.
19
The Government also relies upon Choteau v. Burnet, 283 U.S. 691, 51 S.Ct. 598, 75 L.Ed. 1353, but that case also is not controlling, since it held only that a competent Indian, who had unrestricted control over lands and income therefrom, was not exempt from income tax solely because of his status as an Indian. Such a tax is specifically authorized by Section 6 of the General Allotment Act.
20
See United States v. Eastman, 9 Cir., 118 F.2d 421.
21
See 220 F.2d at page 350. In its answer filed in the District Court, the Government admitted that the lands 'are generally unsuitable for agricultural purposes * * *.' R. 31.
22
220 F.2d 350.
| 12
|
351 U.S. 12
76 S.Ct. 585
100 L.Ed. 891
Judson GRIFFIN and James Crenshaw, Petitioners,v.The PEOPLE OF THE STATE OF ILLINOIS.
No. 95.
Argued Dec. 7, 1955.
Decided April 23, 1956.
Rehearing Denied May 28, 1956.
See 351 U.S. 958, 76 S.Ct. 844.
Mr. Charles A. Horsky, Washington, D.C., for petitioner.
Mr. William C. Wines, Chicago, Ill., for respondent.
Mr. Justice BLACK announced the judgment of the Court and an opinion in which THE CHIEF JUSTICE, Mr. Justice DOUGLAS, and Mr. Justice CLARK, join.
1
Illinois law provides that 'Writs of error in all criminal cases are writs of right and shall be issued of course.'1 The question presented here is whether Illinois may, consistent with the Due Process and Equal Protection Clauses of the Fourteenth Amendment, administer this statute so as to deny adequate appellate review to the poor while granting such review to all others.
2
The petitioners Griffin and Crenshaw were tried together and convicted of armed robbery in the Criminal Court of Cook County, Illinois, Immediately after their conviction they filed a motion in the trial court asking that a certified copy of the entire record, including a stenographic transcript of the proceedings, be furnished them without cost. They alleged that they were 'poor persons with no means of paying the necessary fees to acquire the Transcript and Court Records needed to prosecute an appeal * * *.' These allegations were not denied. Under Illinois law in order to get full direct appellate review of alleged errors by a writ of error it is necessary for the defendant to furnish the appellate court with a bill of exceptions or report of proceedings at the trial certified by the trial judge.2 As Illinois concedes, it is sometimes impossible to prepare such bills of exceptions3 or reports without a stenographic transcript of the trial proceedings.4 Indigent defendants sentenced to death are provided with a free transcript at the expense of the county where convicted.5 In all other criminal cases defendants needing a transcript, whether indigent or not, must themselves buy it. The petitioners contended in their motion before the trial court that failure to provide them with the needed transcript would violate the Due Process and Equal Protection Clauses of the Fourteenth Amendment. The trial court denied the motion without a hearing.
3
Griffin and Crenshaw then filed a petition under the Illinois Post-Conviction Hearing Act.6 Only questions arising under the Illinois or Federal Constitution may be raised in proceedings under this Act. A companion state act provides that indigent petitioners under the Post-Conviction Act may, under some circumstances, obtain a free transcript.7 The effect is that indigents may obtain a free transcript to obtain appellate review of constitutional questions but not of other alleged trial errors such as admissibility and sufficiency of evidence. In their Post-Conviction proceeding petitioners alleged that there were manifest nonconstitutional errors in the trial which entitled them to have their convictions set aside on appeal and that the only impediment to full appellate review was their lack of funds to buy a transcript. These allegations have not been denied. Petitioners repeated their charge that refusal to afford full appellate review solely because of poverty was a denial of due process and equal protection. This petition like the first was dismissed without hearing any evidence. The Illinois Supreme Court affirmed the dismissal solely on the ground that the charges raised no substantial state or federal constitutional questions—the only kind of questions which may be raised in Post-Conviction proceedings. We granted certiorari. 349 U.S. 937, 75 S.Ct. 786, 99 L.Ed. 1266.
4
Counsel for Illinois concedes that these petitioners needed a transcript in order to get adequate appellate review of their alleged trial errors.8 There is no contention that petitioners were dilatory in their efforts to get appellate review, or that the Illinois Supreme Court denied review on the ground that the allegations of trial error were insufficient. We must therefore assume for purposes of this decision that errors were committed in the trial which would merit reversal, but that the petitioners could not get appellate review of those errors solely because they were too poor to buy a stenographic transcript. Counsel for Illinois denies that this violates either the Due Process or the Equal Protection Clause, but states that if it does, the Illinois Post-Conviction statute entitles petitioners to a free transcript. The sole question for us to decide, therefore, is whether due process or equal protection has been violated.9
5
Providing equal justice for poor and rich, weak and powerful alike is an age-old problem.10 People have never ceased to hope and strive to move closer to that goal. This hope, at least in part, brought about in 1215 the royal concessions of Magna Charta: 'To no one will we sell, to no one will we refuse, or delay, right or justice. * * * No free man shall be taken or imprisoned, or disseised, or outlawed, or exiled, or anywise destroyed; nor shall we go upon him nor send upon him, but by the lawful judgment of his peers or by the law of the land.' These pledges were unquestionably steps toward a fairer and more nearly equal application of criminal justice. In this tradition, our own constitutional guaranties of due process and equal protection both call for procedures in criminal trials which allow no invidious discriminations between persons and different groups of persons. Both equal protection and due process emphasize the central aim of our entire judicial system—all people charged with crime must, so far as the law is concerned, 'stand on an equality before the bar of justice in every American court.' Chambers v. Florida, 309 U.S. 227, 241, 60 S.Ct. 472, 479, 84 L.Ed. 716. See also Yick Wo v. Hopkins, 118 U.S. 356, 369, 6 S.Ct. 1064, 1070, 30 L.Ed. 220.11
6
Surely no one would contend that either a State or the Federal Government could constitutionally provide that defendants unable to pay court costs in advance should be denied the right to plead not guilty or to defend themselves in court.12 Such a law would make the constitutional promise of a fair trial a worthless thing. Notice, the right to be heard, and the right to counsel would under such circumstances be meaningless promises to the poor. In criminal trials a State can no more discriminate on account of poverty than on account of religion, race, or color. Plainly the ability to pay costs in advance bears no rational relationship to a defendant's guilt or innocence and could not be used as an excuse to deprive a defendant of a fair trial. Indeed, a provision in the Constitution of Illinois of 1818 provided that every person in Illinois 'ought to obtain right and justice freely, and without being obliged to purchase it, completely and without denial, promptly and without delay, conformably to the laws.'13
7
There is no meaningful distinction between a rule which would deny the poor the right to defend themselves in a trial court and one which effectively denies the poor an adequate appellate review accorded to all who have money enough to pay the costs in advance. It is true that a State is not required by the Federal Constitution to provide appellate courts or a right to appellate review at all. See, e.g., McKane v. Durston, 153 U.S. 684, 687 688, 14 S.Ct. 913, 914—915, 38 L.Ed. 867. But that is not to say that a State that does grant appellate review can do so in a way that discriminates against some convicted defendants on account of their poverty. Appellate review has now become an integral part of the Illinois trial system for finally adjudicating the guilt or innocence of a defendant. Consequently at all stages of the proceedings the Due Process and Equal Protection Clauses protect persons like petitioners from invidious discriminations. See Cole v. Arkansas, 333 U.S. 196, 201, 68 S.Ct. 514, 517, 92 L.Ed. 644; Dowd v. United States ex rel. Cook, 340 U.S. 206, 208, 71 S.Ct. 262, 263, 95 L.Ed. 215; Cochran v. Kansas, 316 U.S. 255, 257, 62 S.Ct. 1068, 1069, 86 L.Ed. 1453; Frank v. Mangum, 237 U.S. 309, 327, 35 S.Ct. 582, 587, 59 L.Ed. 969.
8
All of the States now provide some method of appeal from criminal convictions, recognizing the importance of appellate review to a correct adjudication of guilt or innocence. Statistics show that a substantial proportion of criminal convictions are reversed by state appellate courts.14 Thus to deny adequate review to the poor means that many of them may lose their life, liberty or property because of unjust convictions which appellate courts would set aside. Many States have recognized this and provided aid for convicted defendants who have a right to appeal and need a transcript but are unable to pay for it.15 A few have not. Such a denial is a misfit in a country dedicated to affording equal justice to all and special privileges to none in the administration of its criminal law.16 There can be no equal justice where the kind of trial a man gets depends on the amount of money he has. Destitute defendants must be afforded as adequate appellate review as defendants who have money enough to buy transcripts.
9
The Illinois Supreme Court denied these petitioners relief under the Post-Conviction Act because of its holding that no constitutional rights were violated. In view of our holding to the contrary the State Supreme Court may decide that petitioners are now entitled to a transcript, as the State's brief suggests. See Ill.Rev.Stat., 1955, c. 37, § 163f. Cf. Dowd v. United States ex rel. Cook, 340 U.S., at pages 209—210, 71 S.Ct. at pages 263—264. We do not hold, however, that Illinois must purchase a stenographer's transcript in every case where a defendant cannot buy it. The Supreme Court may find other means of affording adequate and effective appellate review to indigent defendants. For example, it may be that bystanders' bills of exceptions or other methods of reporting trial proceedings could be used in some cases.17 The Illinois Supreme Court appears to have broad power to promulgate rules of procedure and appellate practice.18 We are confident that the State will provide corrective rules to meet the problem which this case lays bare.
10
The judgment of the Supreme Court of Illinois is vacated and the cause is remanded to that court for further action not inconsistent with the foregoing paragraph. Mr. Justice FRANKFURTER joins in this disposition of the case.
11
Vacated and remanded.
12
Mr. Justice FRANKFURTER, concurring in the judgment.
13
The admonition of de Tocqueville not to confuse the familiar with the necessary has vivid application to appeals in criminal cases. The right to an appeal from a conviction for crime is today so established that this leads to the easy assumption that it is fundamental to the protection of life and liberty and therefore a necessary ingredient of due process of law. 'Due process' is, perhaps, the least frozen concept of our law—the least confined to history and the most absorptive of powerful social standards of a progressive society. But neither the unfolding content of 'due process' nor the particularized safeguards of the Bill of Rights disregard procedural ways that reflect a national historic policy. It is significant that no appeals from convictions in the federal courts were afforded (with roundabout exceptions negligible for present purposes) for nearly a hundred years; and, despite the civilized standards of criminal justice in modern England, there was no appeal from convictions (again with exceptions not now pertinent) until 1907. Thus, it is now settled that due process of law does not require a State to afford review of criminal judgments.
14
Nor does the equal protection of the laws deny a State the right to make classifications in law when such classifications are rooted in reason. 'The equality at which the 'equal protection' clause aims is not a disembodied equality. The Fourteenth Amendment enjoins 'the equal protection of the laws', and laws are not abstract propositions.' Tigner v. Texas, 310 U.S. 141, 147, 60 S.Ct. 879, 882, 84 L.Ed. 1124. Since capital offenses are sui generis, a State may take account of the irrevocability of death by allowing appeals in capital cases and not in others. Again, 'the right of appeal may be accorded by the State to the accused upon such terms as in its wisdom may be deemed proper.' McKane v. Durston, 153 U.S. 684, 687—688, 14 S.Ct. 913, 914—915. The States have exercised this discriminating power. The different States and the same State from time to time have conditioned criminal appeals by fixing the time within which an appeal may be taken, by delimiting the scope of review, by shaping the mechanism by which alleged errors may be brought before the appellate tribunal, and so forth.
15
But neither the fact that a State may deny the right of appeal altogether nor the right of a State to make an appropriate classification, based on differences in crimes and their punishment, nor the right of a State to lay down conditions it deems appropriate for criminal appeals, sanctions differentiations by a State that have no relation to a rational policy of criminal appeal or authorizes the imposition of conditions that offend the deepest presuppositions of our society. Surely it would not need argument to conclude that a State could not, within its wide scope of discretion in these matters, allow an appeal for persons convicted of crimes punishable by imprisonment of a year or more, only on payment of a fee of $500. Illinois, of course, has done nothing so crude as that. But Illinois has said, in effect, that the Supreme Court of Illinois can consider alleged errors occurring in a criminal trial only if the basis for determining whether there were errors is brought before it by a bill of exceptions and not otherwise.1 From this it follows that Illinois has decreed that only defendants who can afford to pay for the stenographic minutes of a trial may have trial errors reviewed on appeal by the Illinois Supreme Court. See People v. La Frana, 4 Ill.2d 261, 266, 122 N.E.2d 583, 585—586. It has thereby shut off means of appellate review for indigent defendants.
16
This Court would have to be willfully blind not to know that there have in the past been prejudicial trial errors which called for reversal of convictions of indigent defendants, and that the number of those who have not had the means for paying for the cost of a bill of exceptions is not so negligible as to invoke whatever truth there may be in the maxim de minimis.
17
Law addresses itself to actualities. It does not face actuality to suggest that Illinois affords every convicted person, financially competent or not, the opportunity to take an appeal, and that it is not Illinois that is responsible for disparity in material circumstances. Of course a State need not equalize economic conditions. A man of means may be able to afford the retention of an expensive, able counsel not within reach of a poor man's purse. Those are contingencies of life which are hardly within the power, let alone the duty, of a State to correct or cushion. But when a State deems it wise and just that convictions be susceptible to review by an appellate court, it cannot by force of its exactions draw a line which precludes convicted indigent persons, forsooth erroneously convicted, from securing such a review merely by disabling them from bringing to the notice of an appellate tribunal errors of the trial court which would upset the conviction were practical opportunity for review not foreclosed.
18
To sanction such a ruthless consequence, inevitably resulting from a money hurdle erected by a State, would justify a latter-day Anatole France to add one more item to his ironic comments on the 'majestic equality' of the law. 'The law, in its majestic equality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread.' John Cournos, A Modern Plutarch, p. 27.
19
The State is not free to produce such a squalid discrimination. If it has a general policy of allowing criminal appeals, it cannot make lack of means an effective bar to the exercise of this opportunity. The State cannot keep the word of promise to the ear of those illegally convicted and break it to their hope. But in order to avoid or minimize abuse and waste, a State may appropriately hedge about the opportunity to prove a conviction wrong. When a State not only gives leave for appellate correction of trial errors but must pay for the cost of its exercise by the indigent, it may protect itself so that frivolous appeals are not subsidized and public moneys not needlessly spent. The growing experience of reforms in appellate procedure and sensible, economic modes for securing review still to be devised, may be drawn upon to the end that the State will neither bolt the door to equal justice nor support a wasteful abuse of the appellate process.
20
It follows that the petitioners must be accorded an appeal from their conviction, either by having the State furnish them a transcript of the proceedings in the trial court, or by any other means, of which we have not been advised, that may be available under Illinois law, so that the errors of which they complain can effectively be brought for review to the Illinois Supreme Court. It is not for us to tell Illinois what means are open to the indigent and must be chosen. Illinois may prescribe any means that are within the wide area of its constitutional discretion.
21
The case of these petitioners is that the only adequate means of bringing for review allegedly fatal trial defects resulting in a potentially reversible conviction was a bill of exceptions which their poverty precluded them from securing. The order of the Illinois Supreme Court and the argument of the Attorney General of Illinois in support of that court's judgment apparently assumed that that was the case. Considering the nature of the issue thus raised by petitioners appearing for themselves, it would savor of disrespect to the Supreme Court of Illinois for us to find an implication in its unqualified rejection of the claims of the petitioners that an effective review other than by bill of exceptions could be had in the present situation. Cf. Diaz v. Gonzalez, 261 U.S. 102, 105—106, 43 S.Ct. 286, 287, 67 L.Ed. 550. When the case again reaches the Illinois Supreme Court, that court may, of course, find within the existing resources of Illinois law means of according to petitioners effective satisfaction of their constitutional right not to be denied the equal protection of the laws.
22
We must be mindful of the fact that there are undoubtedly convicts under confinement in Illinois prisons, in numbers unknown to us and under unappealed sentences imposed years ago, who will find justification in this opinion, unless properly qualified, for proceedings both in the state and the federal courts upon claims that they are under illegal detention in that they have been denied a right under the Federal Constitution. It would be an easy answer that a claim that was not duly asserted—as was the timely claim by these petitioners—cannot be asserted now. The answer is too easy. Candor compels acknowledgement that the decision rendered today is a new ruling. Candor compels the further acknowledgement that it would not be unreasonable for all indigent defendants, now incarcerated, who at the time were unable to pay for transcripts of proceedings in trial courts, to urge that they were justified in assuming that such a restriction upon criminal appeals in Illinois was presumably a valid exercise of the State's power at the time when they suffered its consequences. Therefore it could well be claimed that thereby any conscious waiver of a constitutional right is negatived.
23
The Court ought neither to rely on casuistic arguments in denying constitutional claims, nor deem itself imprisoned within a formal, abstract dilemma. The judicial choice is not limited to a new ruling necessarily retrospective, or to rejection of what the requirements of equal protection of the laws, as now perceived, require. For sound reasons, law generally speaks prospectively. More than a hundred years ago, for instance, the Supreme Court of Ohio, confronted with a problem not unlike the one before us, found no difficulty in doing so when it concluded that legislative divorces were unconstitutional. Bingham v. Miller, 17 Ohio 445. In arriving at a new principle, the judicial process is not impotent to define its scope and limits. Adjudication is not a mechanical exercise nor does it compel 'either/or' determinations.
24
We should not indulge in the fiction that the law now announced has always been the law and, therefore, that those who did not avail themselves of it waived their rights. It is much more conducive to law's self-respect to recognize candidly the considerations that give prospective content to a new pronouncement of law. That this is consonant with the spirit of our law and justified by those considerations of reason which should dominate the law, has been luminously expounded by Mr. Justice Cardozo, shortly before he came here and in an opinion which he wrote for the Court. See Address of Chief Judge Cardozo, 55 Report of New York State Bar Ass'n, 263, 294 et seq., and Great Northern R. Co. v. Sunburst Oil & Refining Co., 287 U.S. 358, 363 366, 53 S.Ct. 145, 148—149, 77 L.Ed. 360. Such a molding of law, by way of adjudication, is peculiarly applicable to the problem at hand. The rule of law announced this day should be delimited as indicated.
25
Mr. Justice BURTON and Mr. Justice MINTON, whom Mr. Justice REED and Mr. Justice HARLAN join, dissenting.
26
While we do not disagree with the desirability of the policy of supplying an indigent defendant with a free transcript of testimony in a case like this, we do not agree that the Constitution of the United States compels each State to do so with the consequence that, regardless of the State's legislation and practice to the contrary, this Court must hold invalid state appellate proceedings wherever a required transcript has not been provided without cost to an indigent litigant who has requested that it be so provided. It is one thing for Congress and this Court to prescribe such procedure for the federal courts. It is quite another for this Court to hold that the Constitution of the United States has prescribed it for all state courts.
27
In the administration of local law the Constitution has been interpreted as permitting the several States generally to follow their own familiar procedure and practice. In so doing this Court has recognized the widely differing but locally approved procedures of the several States. Whether approving of the particular procedures or not, this Court has treated them largely as matters reserved to the States and within the broad range of permissible 'due process' in a constitutional sense.
28
Illinois, as the majority admit, could thus deny an appeal altogether in a criminal case without denying due process of law. McKane v. Durston, 153 U.S. 684, 14 S.Ct. 913, 38 L.Ed. 867. To allow an appeal at all, but with some difference among convicted persons as to the terms upon which an appeal is exercised does not deny due process. It may present a question of equal protection. The petitioners urge that point here.
29
Whether the Illinois statute denies equal protection depends upon whether, first, it is an arbitrary and unreasonable distinction for the legislature to make, between those convicted of a capital offense and those convicted of a lesser offense, as to their right to a free transcript. It seems to us the whole practice of criminal law teaches that there are valid distinctions between the ways in which criminal cases may be looked upon the treated without violating the Constitution. Very often we have cases where the convicted seek only to avoid the death penalty. As all practicing lawyers know, who have defended persons charged with capital offenses, often the only goal possible is to avoid the death penalty. There is something pretty final about a death sentence.
30
If the actual practice of law recognizes this distinction between capital and noncapital cases, we see no reason why the legislature of a State may not extend the full benefit of appeal to those convicted of capital offenses and deny it to those convicted of lesser offenses. It is the universal experience in the administration of criminal justice that those charged with capital offenses are granted special considerations. Examples of such will readily occur. All States allow a larger number of peremptory challenges of jurors in capital cases than in other cases. Most States permit changes of venue in capital cases on different terms than in other criminal cases. Some States require a verdict of 12 jurors for conviction in a capital case but allow less than 12 jurors to convict in noncapital cases. On the other side of the coin, most States provide no statute of limitations in capital cases. We think the distinction here made by the Illinois statute between capital cases and noncapital cases is a reasonable and valid one.
31
Secondly, certainly Illinois does not deny equal protection to convicted defendants when the terms of appeal are open to all, although some may not be able to avail themselves of the full appeal because of their poverty. Illinois is not bound to make the defendants economically equal before its bar of justice. For a State to do so may be a desirable social policy, but what may be a good legislative policy for a State is not necessarily required by the Constitution of the United States. Persons charged with crimes stand before the law with varying degrees of economic and social advantage. Some can afford better lawyers and better investigations of their cases. Some can afford bail, some cannot. Why fix bail at any reasonable sum if a poor man can't make it?
32
The Constitution requires the equal protection of the law, but it does not require the States to provide equal financial means for all defendants to avail themselves of such laws.
33
Mr. Justice BLACK'S opinion is not limited to the future. It holds that a past as well as a future conviction of crime in a state court is invalid where the State has failed to furnish a free transcript to an indigent defendant who has sought, as petitioner did here, to obtain a review of a ruling that was dependent upon the evidence in his case. This is an interference with state power for what may be a desirable result, but which we believe to be within the field of local option.
34
Whether Illinois would permit appeals adequate to pass upon alleged errors on bills of exception, prepared by counsel and approved by judges, without requiring that full stenographic notes be transcribed is not before us. We assume that it would.
35
Mr. Justice HARLAN, dissenting.
36
Much as I would prefer to see free transcripts furnished to indigent defendants in all felony cases, I find myself unable to join in the Court's holding that the Fourteenth Amendment requires a State to do so or to furnish indigents with equivalent means of exercising a right to appeal. The importance of the question decided by the Court justifies adding to what Mr. Justice BURTON and Mr. Justice MINTON have written my further grounds for dissenting and the reasons why I find the majority opinions unsatisfying.
37
1. Inadequacy of the Record.—I would decline to decide the constitutional question tendered by petitioners because the record does not present it in that 'clean-cut,' 'concrete,' and 'unclouded' form usually demanded for a decision of constitutional issues. Rescue Army v. Municipal Court of Los Angeles, 331 U.S. 549, 584, 67 S.Ct. 1409, 1427, 91 L.Ed. 1666. In my judgment the case should be remanded to the Illinois courts for further proceedings so that we might know the precise nature of petitioners' claim before passing on it.
38
The record contains nothing more definite than the allegation that 'petitioners are poor persons with no means of paying the necessary fees to acquire the Transcript and Court Records needed to prosecute an appeal from their convictions.' For my part I cannot tell whether petitioners' claim is that a transcript was 'needed' because (a) under Illinois law a transcript is a prerequisite to appellate review of trial errors,1 or (b) as a factual matter petitioners could not prepare an adequate bill of exceptions short of having a transcript.
39
If the claim is that a transcript was legally necessary, it is based on an erroneous view of Illinois law. The Illinois cases cited by the petitioners establish only that trial errors cannot be reviewed in the absence of a bill of exceptions, and not that a transcript is essential to the preparation of such a bill.2 To the contrary, an unbroken line of Illinois cases establishes that a bill of exceptions may consist simply of a narrative account of the trial proceedings prepared from any available sources—for example, from the notes or memory of the trial judge, counsel, the defendant, or bystanders—and that the trial judge must either certify such a bill as accurate or point out the corrections to be made.3 Viewed in the light of these cases, the only constitutional question presented by petitioners' bare allegation that they were unable to purchase a transcript would be: Is an indigent defendant, who has not shown that he is unable to obtain full appellate review of his conviction by a narrative bill of exceptions, constitutionally entitled to the added advantage of a free transcript of the trial proceedings for use as a bill of exceptions? I need hardly pause to suggest that such a claim would present no substantial constitutional question.
40
The Court, however, either takes judicial notice that as a practical matter the alternative methods of preparing a bill of exceptions are inadequate or finds in petitioners' claims an allegation of fact that their circumstances were such as to prevent them from utilizing the alternative methods. But even accepting this reading of the pleadings, the constitutional question tendered should not be decided without knowing the circumstances underlying the conclusory allegation of 'need.' Petitioners' indigence, the only underlying 'fact' alleged, did not in itself necessarily preclude them from preparing a narrative bill of exceptions, and we are told nothing as to the other circumstances which prevented them from doing so. The record does not even disclose whether petitioners were incarcerated during the period in which the bill of exceptions had to be filed, or whether they were represented by counsel at the trial. We are left to speculate on the nature of the alleged trial errors and the scope of the bill of exceptions needed to present them. Who can say that if we knew the facts we might not have before us a much narrower constitutional question than the one decided today, or perhaps no such question at all. In these circumstances, I would follow the salutary policy 'of avoiding constitutional decisions until the issues are presented with clarity, precision and certainty', Rescue Army v. Municipal Court of Los Angeles, supra, 331 U.S. at page 576, 67 S.Ct. at page 1423, and would refuse to decide the constitutional question in the abstract form in which it has been presented here.
41
According to petitioners' tabulation, no more than 29 States provide free transcripts as of right to indigents convicted of non-capital crimes. Thus the sweeping constitutional pronouncement made by the Court today will touch the laws of at least 19 States4 and will create a host of problems affecting the status of an unknown multitude of indigent convicts. A decision having such wide impact should not be made upon a record as obscure as this, especially where there are means ready at hand to have clarified the issue sought to be presented.
42
However, since I stand alone in my view that the Court should refrain from deciding the broad question urged upon us until the necessity for such a decision becomes manifest, I deem it appropriate also to note my disagreement with the Court's decision of that question. Inasmuch as the Court's decision is not—and on this record cannot be—based on any facts peculiar to this case, I consider that question to be: Is an indigent defendant who 'needs' a transcript in order to appeal constitutionally entitled, regardless of the nature of the circumstances producing that need, to have the State either furnish a free transcript or take some other action to assure that he does in fact obtain full appellate review?
43
2. Equal Protection.—In finding an answer to that question in the Equal Protection Clause, the Court has painted with a broad brush. It is said that a State cannot discriminate between the 'rich' and the 'poor' in its system of criminal appeals. That statement of course commands support, but it hardly sheds light on the true character of the problem confronting us here. Illinois has not imposed any arbitrary conditions upon the exercise of the right of appeal nor any requirements unnecessary to the effective working of its appellate system. Trial errors cannot be reviewed without an appropriate record of the proceedings below; if a transcript is used, it is surely not unreasonable to require the appellant to bear its cost; and Illinois has not foreclosed any other feasible means of preparing such a record. Nor is this a case where the State's own action has prevented a defendant from appealing. Cf. Dowd v. United States ex rel. Cook, 340 U.S. 206, 71 S.Ct. 262, 95 L.Ed. 215; Cochran v. Kansas, 316 U.S. 255, 62 S.Ct. 1068, 86 L.Ed. 1453. All that Illinois has done is to fail to alleviate the consequences of differences in economic circumstances that exist wholly apart from any state action.
44
The Court thus holds that, at least in this area of criminal appeals, the Equal Protection Clause imposes on the States an affirmative duty to lift the handicaps flowing from differences in economic circumstances. That holding produces the anomalous result that a constitutional admonition to the States to treat all persons equally means in this instance that Illinois must give to some what it requires others to pay for. Granting that such a classification would be reasonable, it does not follow that a State's failure to make it can be regarded as discrimination. It may as accurately be said that the real issue in this case is not whether Illinois has discriminated but whether it has a duty to discriminate.
45
I do not understand the Court to dispute either the necessity for a bill of exceptions or the reasonableness of the general requirement that the trial transcript, if used in its preparation, be paid for by the appealing party. The Court finds in the operation of these requirements, however, an invidious classification between the 'rich' and the 'poor.' But no economic burden attendant upon the exercise of a privilege bears equally upon all, and in other circumstances the resulting differentiation is not treated as an invidious classification by the State, even though discrimination against 'indigents' by name would be unconstitutional. Thus, while the exclusion of 'indigents' from a free state university would deny them equal protection, requiring the payment of tuition fees surely would not, despite the resulting exclusion of those who could not afford to pay the fees. And if imposing a condition of payment is not the equivalent of a classification by the State in one case, I fail to see why it should be so regarded in another. Thus if requiring defendants in felony cases to pay for a transcript constitutes a discriminatory denial to indigents of the right of appeal available to others, why is it not a similar denial in misdemeanor cases or, for that matter, civil cases?
46
It is no answer to say that equal protection is not an absolute, and that in other than criminal cases the differentiation is 'reasonable.' The resulting classification would be invidious in all cases, and an invidious classification offends equal protection regardless of the seriousness of the consequences. Hence it must be that the differences are 'reasonable' in other cases not because the 'classification' is reasonable but simply because it is not unreasonable in those cases for the State to fail to relieve indigents of the economic burden. That is, the issue here is not the typical equal protection question of the reasonableness of a 'classification' on the basis of which the State has imposed legal disabilities, but rather the reasonableness of the State's failure to remove natural disabilities. The Court holds that the failure of the State to do so is constitutionally unreasonable in this case although it might not be in others. I submit that the basis for that holding is simply an unarticulated conclusion that it violates 'fundamental fairness' for a State which provides for appellate review, and thus apparently considers such review necessary to assure justice, not to see to it that such appeals are in fact available to those it would imprison for serious crimes. That of course is the traditional language of due process, see Betts v. Brady, 316 U.S. 455, 462, 62 S.Ct. 1252, 1256, 86 L.Ed. 1595, and I see no reason to import new substance into the concept of equal protection to dispose of the case, especially when to do so gives rise to the all-too-easy opportunity to ignore the real issue and solve the problem simply by labeling the Illinois practice as invidious 'discrimination.'
47
3. Due Process.—Has there been a violation of the Due Process Clause? The majority of the Court concedes that the Fourteenth Amendment does not require the States to provide for any kind of appellate review. Nevertheless, Illinois, in the forefront among the States, established writs of error in criminal cases as early as 1827.5 In 1887, it provided for official court reporters, thereby relieving defendants of the burden of hiring reporters in order to obtain a transcript.6 In 1927, it provided that for indigents sentenced to death 'all necessary costs and expenses' incident to a writ of error, including the cost of a transcript, would be paid by the counties.7 And in 1953, free transcripts were authorized for the presentation of constitutional claims.8 Thus Illinois has steadily expanded the protection afforded defendants in criminal cases, and in recent years has made substantial strides towards alleviating the natural disadvantages of indigents. Can it be that, while it was not unconstitutional for Illinois to afford no appeals, its steady progress in increasing the safeguards against erroneous convictions has resulted in a constitutional decline?
48
Of course the fact that appeals are not constitutionally required does not mean that a State is free of constitutional restraints in establishing the terms upon which appeals will be allowed. It does mean, however, that there is no 'right' to an appeal in the same sense that there is a right to a trial.9 Rather the constitutional right under the Due Process Clause is simply the right not to be denied an appeal for arbitrary or capricious reasons. Nothing of that kind, however, can be found in any of the steps by which Illinois has established its appellate system.
49
We are all agreed that no objection of substance can be made to the provisions for free transcripts in capital and constitutional cases. The due process challenge must therefore be directed to the basic step of permitting appeals at all without also providing an in forma pauperis procedure. But whatever else may be said of Illinois' reluctance to expend public funds in perfecting appeals for indigents, it can hardly be said to be arbitrary. A policy of economy may be unenlightened, but it is certainly not capricious. And that it has never generally been so regarded is evidenced by the fact that our attention has been called to no State in which in forma pauperis appeals were established contemporaneously with the right of appeal. I can find nothing in the past decisions of this Court justifying a holding that the Fourteenth Amendment confines the States to a choice between allowing no appeals at all or undertaking to bear the cost of appeals for indigents, which is what the Court in effect now holds.
50
It is argued finally that, even if it cannot be said to be 'arbitrary,' the failure of Illinois to provide petitioners with the means of exercising the right of appeal that others are able to exercise is simply so 'unfair' as to be a denial of due process. I have some question whether the non-arbitrary denial of a right that the State may withhold altogether could ever be so characterized. In any event, however, to so hold it is not enough that we consider free transcripts for indigents to be a desirable policy or that we would weigh the competing social values in favor of such a policy were it our function to distribute Illinois' public funds among alternative uses. Rather the question is whether some method of assuring that an indigent is able to exercise his right of appeal is 'implicit in the concept of ordered liberty,' Palko v. Connecticut, 302 U.S. 319, 325, 58 S.Ct. 149, 152, 82 L.Ed. 288, so that the failure of a State so to provide constitutes a 'denial of fundamental fairness, shocking to the universal sense of justice,' Betts v. Brady, supra (316 U.S. 462, 62 S.Ct. 1256). Such an equivalence between persons in the means with which to exercise a right of appeal has not, however, traditionally been regarded as an essential of 'fundamental fairness,' and the reforms extending such aid to indigents have only recently gained widespread acceptance. Indeed, it was not until an Act of Congress in 1944 that defendants in federal criminal cases became entitled to free transcripts,10 and to date approximately one-third of the States still have not taken that step. With due regard for the constitutional limitations upon the power of this Court to intervene in State matters, I am unable to bring myself to say that Illinois' failure to furnish free transcripts to indigents in all criminal cases is 'shocking to the universal sense of justice.'
51
As I view this case, it contains none of the elements hitherto regarded as essential to justify action by this Court under the Fourteenth Amendment. In truth what we have here is but the failure of Illinois to adopt as promptly as other States a desirable reform in its criminal procedure. Whatever might be said were this a question of procedure in the federal courts, regard for our system of federalism requires that matters such as this be left to the States. However strong may be one's inclination to hasten the day when in forma pauperis criminal procedures will be universal among the States, I think it is beyond the province of this Court to tell Illinois that it must provide such procedures.
1
Ill.Rev.Stat., 1955, c. 38, § 769.1.
2
Ill.Rev.Stat., 1953, c. 110, § 259.70A (Supreme Court Rule 70A), now Ill.Rev.Stat., 1955, c. 110, § 101.65 (Supreme Court Rule 65). A writ of error may also be prosecuted on a 'mandatory record' kept by the clerk, consisting of the indictment, arraignment, plea, verdict and sentence. The 'mandatory record' can be obtained free of charge by an indigent defendant. In such instances review is limited to errors on the face of the mandatory record, and there is no review of trial errors such as an erroneous ruling on the admission of evidence. See People v. Loftus, 400 Ill. 432, 81 N.E.2d 495. See also Cullen v. Stevens, 389 Ill. 35, 58 N.E.2d 456; A Study of the Illinois Supreme Court, 15 U. of Chi.L.Rev. 107, 125.
3
'A complete bill of exceptions consists of all proceedings in the case from the time of the convening of the court until the termination of the trial. It includes all of the motions and rulings of the trial court, evidence heard, instructions and other matters which do not come within the clerk's mandatory record.' People ex rel. Iasello v. McKinlay, 409 Ill. 120, 124—125, 98 N.E.2d 728, 730.
4
In oral argument counsel for Illinois stated:
'With respect to the so-called bystanders' bill of exceptions or the bill of exceptions prepared from someone's memory in condensed and narrative form and certified to by the trial judge as to whether that's available in Illinois I can say that everybody out there understands that it is but nobody has heard of its ever being actually used in a criminal case in Illinois in recent years. I think if you went back before the days of court reporting you would find them but none today. And I will say that Illinois has not suggested in the brief that such a narrative transcript would necessarily or even generally be the equivalent of a verbatim transcript of all of the trial.
'There isn't any way that an Illinois convicted person in a noncapital case can obtain a bill of exceptions without paying for it.'
See People v. Yetter, 386 Ill. 594, 54 N.E.2d 532; People v. Johns, 388 Ill. 212, 57 N.E.2d 895; Jennings v. Illinois, 342 U.S. 104, 109—110, 72 S.Ct. 123, 126, 96 L.Ed. 119, on remand, 411 Ill. 21, 23, 25, 27, 102 N.E.2d 824, 825—827; People v. Joyce, 1 Ill.2d 225, 230, 115 N.E.2d 262, 264—265; People v. La Frana, 4 Ill.2d 261, 266, 122 N.E.2d 583, 585—586; People ex rel. Iasello v. McKinlay, 409 Ill. 120, 98 N.E.2d 728; People v. O'Connell, 411 Ill. 591, 104 N.E.2d 825.
5
Ill.Rev.Stat., 1955, c. 38, § 769a.
6
Ill.Rev.Stat., 1955, c. 38, §§ 826—832.
7
Ill.Rev.Stat., 1955, c. 37, § 163f. This section provides in part that 'In any case arising under (the Post-Conviction Hearing Act) in which the presiding judge has determined that the post-conviction petition is sufficient to require an answer, it shall be the duty of the official court reporter to transcribe, in whole or in part, his stenographic notes of the evidence introduced at the trial in which the petitioner was convicted, if instructed so to do by the State's Attorney or by the court.'
8
See note 4, supra, and cases there cited.
9
A dissenting opinion argues that the constitutional question is narrower because petitioners alleged that a transcript was needed rather than required. The State made no such claim and all the briefs and arguments on both sides together with the opinion of the Illinois Supreme Court treated the sole question as being as we have stated it.
10
'Ye shall do no unrighteousness in judgment: thou shalt not respect the person of the poor, nor honour the person of the mighty: but in righteousness shalt thou judge thy neighbor.' Leviticus, c. 19, v. 15.
11
Dissenting opinions here argue that the Illinois law should be upheld since by its terms it applies to rich and poor alike. But a law nondiscriminatory on its face may be grossly discriminatory in its operation. For example, this Court struck down the so-called 'grandfather clause' of the Oklahoma Constitution as discriminatory against Negroes although that clause was by its terms nondiscriminatory. Guinn v. United States, 238 U.S. 347, 35 S.Ct. 926, 59 L.Ed. 1340. See also Lane v. Wilson, 307 U.S. 268, 59 S.Ct. 872, 83 L.Ed. 1281.
12
See discussion in Hovey v. Elliott, 167 U.S. 409, 17 S.Ct. 841, 42 L.Ed. 215.
13
Ill.Constitution of 1818, Art. VIII, § 12. Substantially the same provision has been carried over into the present Illinois Constitution, Art. II, § 19.
14
See Note, Reversals in Illinois Criminal Cases, 42 Harv.L.Rev. 566.
15
See, e.g., Ariz.Code Ann., 1939, § 44—2525; Ark.Stat., 1947, § 22—357; Page's Ohio Rev.Code Ann., 1954, § 2301.24; S.C.Code. 1952, § 15—1903; McKinney's N.Y.Laws, Crim.Code, 1945 (Supp.1955), § 456. See also Note, 100 A.L.R. 321.
16
The Criminal Court of Appeals in Oklahoma in 1913 spoke in the tradition of this country's dedication to due process and equal protection when it declared that the law is no respecter of persons and said:
'We want the people of Oklahoma to understand, one and all, that the poorest and most unpopular person in the state * * * can depend upon it that justice is not for sale in Oklahoma, and that no one can be deprived of his right of appeal simply because he is unable to pay a stenographer to extend the notes of the testimony.' Jeffries v. State, 9 Okl.Cr. 573, 576, 132 P. 823, 824.
17
See Weatherford v. Wilson, 1840, 2 Scam. 253, 3 Ill. 253; People ex rel. Maher v. Williams, 1878, 91 Ill. 87; People ex rel. Hall v. Holdom, 1901, 193 Ill. 319, 61 N.E. 1014; People v. Joyce, 1953, 1 Ill.2d 225, 230, 115 N.E.2d 262, 264—265; Miller v. United States, 1942, 317 U.S. 192, 63 S.Ct. 187, 87 L.Ed. 179; Note, 15 Ann.Cas. 737.
18
Ill.Rev.Stat., 1955, c. 110, § 2; Ill.Rev.Stat., 1955, c. 110, § 101.65 (Supreme Court Rule 65); People v. Callopy, 358 Ill. 11, 192 N.E. 634.
1
'The record in the trial court may consist only of the mandatory record, viz., indictment, arraignment, plea, trial and judgment. * * * This appears in the clerk's record in every case * * *. The record may include also a bill of exceptions, which consists of all of the motions and rulings of the trial court, evidence heard, instructions, and other matters which do not come directly within the clerk's mandatory record. This may be only a part of the record on review when a bill of exceptions is prayed and allowed, and certified by the court. * * * Therefore, when the review is had upon the common-law record, the sole matter only that may be considered by the court is error appearing upon the face of the record, and matters may not be added by argument, affidavit, or otherwise, to supply or expand the record. The case must stand or fall upon the errors appearing in the record. Of course, where there is a bill of exceptions, which includes motions, evidence, rulings on evidence, instructions, and the like, and such bill of exceptions is made a part of the record, errors may be reached by the remedy of writ of error. * * *' People v. Loftus, 400 Ill. 432, 433-434, 81 N.E.2d 495, 497.
1
The Illinois Supreme Court may have interpreted the pleadings in this manner. It described the petitioners' 'sole contention' as being that they were 'unable to purchase a bill of exceptions and were, therefore, unable to obtain a complete review by this Court.' This suggests that the state court construed the claim to be that an appeal was necessarily precluded by the lack of a transcript, not that the petitioners' particular circumstances produced that result. If that is what the Illinois court meant, its construction, having a reasonable basis, would be binding on this Court and would constitute an adequate state ground for the denial of any claim premised on the existence of particular circumstances preventing the petitioners from pursuing other available methods of review.
2
E.g., People v. Johns, 388 Ill. 212, 57 N.E.2d 895; People v. Loftus, 400 Ill. 432, 81 N.E.2d 495; People v. O'Connell, 411 Ill. 591, 104 N.E.2d 825.
3
Weatherford v. Wilson, 1840, 2 Scam, 253, 3 Ill. 253; People ex rel. Maher v. Williams, 1878, 91 Ill. 87; People ex rel. Munson v. Gary, 1883, 105 Ill. 264; People ex rel. Hall v. Holdom, 1901, 193 Ill. 319, 61 N.E. 1014; 162 East Ohio Street Hotel Corp. v. Lindheimer, 1938, 368 Ill. 294, 13 N.E.2d 970; Weber v. Sneeringer, 1928, 247 Ill.App. 294; Merkle v. Kegerreis, 1953, 350 Ill.App. 103, 112 N.E.2d 175; see also People ex rel. North American Restaurant v. Chetlain, 1906, 219 Ill. 248, 76 N.E. 364; Mayville v. French, 1910, 246 Ill. 434, 92 N.E. 919; People ex rel. Simus v. Donoghue, 1941, 377 Ill. 122, 35 N.E.2d 371. This line of cases was reaffirmed by the Illinois Supreme Court in 1953, just three months before the petitioners were convicted, in People v. Joyce, 1 Ill.2d 225, 230, 115 N.E.2d 262, 264—265, in which the Williams, Gary, Holdom and Lindheimer cases, supra, were cited with approval for the proposition that trial errors may be presented on a writ of error by a 'constructed or 'bystander's' bill of exceptions.' The holding of that case was that a defendant to whom these alternative methods were not available 'as a practical matter' because of his indigence and incarceration did not, by failing to seek direct review of his conviction, 'waive' the right given him by the Illinois Post-Conviction Hearing Act to assert his constitutional claims in a collateral proceeding. Accord: People v. La Frana, 4 Ill.2d 261, 266, 122 N.E.2d 583, 585 586. That holding does not, of course, detract from the court's affirmation that a transcript is not legally required for appellate review of trial errors. It is equally clear that Illinois' recognition of 'practicalities' in not applying a strict doctrine of waiver to the remedial Post-Conviction Hearing Act does not necessarily mean that the alternative methods of obtaining review are not sufficiently 'available' to satisfy any supposed constitutional requirements. That question would depend upon the facts of the particular case—of which we have not been informed here—and upon the evaluation of them for constitutional purposes.
4
Of these 19 at least 5 have, however, expressly given the trial courts discretionary power to order free transcripts in non-capital cases. Mass.Ann.Laws, c. 278, § 33A, as amended by Acts 1955, c. 352 ('by order of the court'); N.D.Rev.Code, 1943, § 27—0606 (when 'there is reasonable cause therefor'); Ore.Rev.Stat., 1953, § 21.470 (if 'justice will be thereby promoted'); S.D.Code, 1939, § 34.3903 (if 'essential to the protection of the substantial rights of the defendant'); Wash.Rev.Code, 1951, § 2.32.240 (if 'justice will be thereby promoted'). The Rhode Island Supreme Court has reached a similar result by interpretation of a statute authorizing reimbursement for expenditures of appointed counsel. State v. Hudson, 1935, 55 R.I. 141, 179 A. 130, 135, 100 A.L.R. 313 ('sound discretion * * * to be exercised with great circumspection and only for serious cause'). In addition, petitioners' brief refers to a letter from the Chief Justice of the Connecticut Supreme Court of Errors which states that free transcripts may be furnished in the discretion of the court in non-capital cases.
5
Ill.Rev.L.1827, Crim.Code, §§ 186, 187; Ill.Rev.Stat., 1955, c. 38, § 769.1.
6
Ill.Laws 1887, p. 159; Ill.Rev.Stat., 1955, c. 37, § 163b.
7
Ill.Laws 1927, p. 400, § 1 1/2; Ill.Rev.Stat., 1955, c. 38, § 769a.
8
Ill.Laws 1953, p. 859; Ill.Rev.Stat., 1955, c. 37, § 163f.
9
This difference makes of dubious validity any analogy between a condition imposed upon the right to defend oneself and a condition imposed upon the right to appeal.
10
58 Stat. 5, 28 U.S.C. §§ 753(f), 1915(a), 28 U.S.C.A. §§ 753(f), 1915(a). On the prior federal practice, see, e.g., Estabrook v. King, 8 Cir., 119 F.2d 607, 610; United States v. Fair, D.C.N.D.Cal., 235 F. 1015.
| 12
|
351 U.S. 79
76 S.Ct. 600
100 L.Ed. 953
AMERICAN AIRLINES, Incorporated, Petitioner,v.NORTH AMERICAN AIRLINES, Incorporated.
No. 410.
Argued March 6 and 7, 1956.
Decided April 23, 1956.
Mr.Howard C. Westwood, Washington, D.C., for petitioner.
Mr. Walter J. Derenberg, New York City, for respondent.
Mr. Justice MINTON delivered the opinion of the Court.
1
Twentieth Century Airlines, Inc., was issued a letter of registration as a large irregular air carrier by the Civil Aeronautics Board in 1947. For some reason, beginning in 1951 it conducted its business under the name of North American Airlines. On March 3, 1952, it amended its articles of incorporation so as legally to change its name to North American Airlines, Inc. By letter dated March 11, 1952, it requested the C.A.B. to reissue its letter of registration in the new corporate name. The Board took no action on that request, but rather, in August 1952, adopted an Economic Regulation requiring every irregular carrier after November 15, 1952, to do business in the name in which its letter of registration was issued. 14 CFR § 291.28. The Board explained that under the Regulation it would allow continued use of a different name to which good will had become attached, except where use of such name constitutes a violation of § 411 of the Civil Aeronautics Act, 52 Stat. 1003, as amended, 66 Stat. 628, 49 U.S.C. § 491, 49 U.S.C.A. § 491, which prohibits unfair or deceptive commercial practices and unfair methods of competition. 17 Fed.Reg. 7809.
2
On October 6, 1952, respondent applied for permission to continue use of its name, 'North American Airlines.' Petitioner, American Airlines, on October 17, 1952, filed a memorandum with the Board requesting denial of North American's application for the reasons, among others, that use of the name 'North American' infringed upon its long-established trade name, 'American,' and constituted an unfair method of competition in violation of § 411 of the Act. The Board, as authorized by § 411, on its own motion instituted an investigation and hearing into whether there was a violation of § 411 by North American. It consolidated with that proceeding an investigation and hearing into the matter of North American's application for change of name in its letter of registration. American was granted leave to intervene in the consolidated proceeding.
3
After extensive hearings, the Board found that respondent's use of the name 'North American' in the air transportation industry, in which it competed with American, had caused 'substantial public confusion,' which was 'likely to continue' and which constituted 'an unfair or deceptive practice and an unfair method of competition within the meaning of Section 411.' Docket Nos. 5774 and 5928 (Nov. 4, 1953), 14—15 mimeo). It found that the public interest required elimination of the use of the name, and accordingly it denied the application of North American and ordered it to 'cease and desist from engaging in air transportation under the name 'North American Airlines, Inc.,' 'North American Airlines,' 'North American,' or any combination of the word 'American." Id., at 15—16. On petition for review by North American, the Court of Appeals for the District of Columbia set aside the Board's order. 97 U.S.App.D.C. 85, 228 F.2d 432. American, having been admitted as a party below by intervention, sought, and we granted, certiorari. 350 U.S. 894, 76 S.Ct. 154.
4
As we understand its opinion, the Court of Appeals set aside the order because the public interest in this proceeding was inadequate to justify exercise of the Board's jurisdiction under § 411. Although the court was critical of the finding of 'substantial public confusion,' it did not, on its disposition of the case, expressly disturb that or any other of the Board's findings. For the purposes of review here, we will accept the findings, and there is no cause for this Court to review the evidence. Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456, has no application in the present posture of the case before us. The questions then presented are whether confusion between the parties' trade names justified a proceeding by the Board to protect the public and whether the kind of confusion found by the Board could support a conclusion of a violation of the statute by respondent.
5
This is a case of first impression under § 411. That section provides that
6
'The Board may, upon its own initiative or upon complaint * * * if it considers that such action by it would be in the interest of the public, investigate and determine whether any air carrier * * * has been or is engaged in unfair or deceptive practices or unfair methods of competition in air transportation or the sale thereof.'
7
If the Board finds that the carrier is so engaged, 'it shall order such air carrier * * * to cease and desist from such practices or methods of competition.' Section 411 was modeled closely after § 5 of the Federal Trade Commission Act,1 which similarly prohibits 'unfair methods of competition in commerce, and unfair or deceptive acts or practices' and provides for issuance of a complaint 'if it shall appear to the Commission that a proceeding by it * * * would be to the interest of the public.' 38 Stat. 719, as amended, 15 U.S.C. § 45, 15 U.S.C.A. § 45. We may profitably look to judicial interpretation of § 5 as an aid in the resolution of the questions raised here under § 411.
8
It should be noted at the outset that a finding as to the 'interest of the public' under both § 411 and § 5 is not a prerequisite to the issuance of a cease and desist order as such. Rather, consideration of the public interest is made a condition upon the assumption of jurisdiction by the agency to investigate trade practices and methods of competition and determine whether or not they are unfair. Thus, this Court has held that, under § 5, the Federal Trade Commission may not employ its powers to vindicate private rights and that whether or not the facts, on complaint or as developed, show the public interest to be sufficiently 'specific and substantial' to authorize a proceeding by the Commission is a question subject to judicial review. Federal Trade Commission v. Klesner, 280 U.S. 19, 50 S.Ct. 1, 74 L.Ed. 138. See also Federal Trade Commission v. R. F. Keppel & Bro., Inc., 291 U.S. 304, 54 S.Ct. 423, 78 L.Ed. 814; Federal Trade Commission v. Royal Milling Co., 288 U.S. 212, 53 S.Ct. 335, 77 L.Ed. 706.
9
In the Klesner case, two District of Columbia retailers, with a long history of acrimonious personal and business relations, were both operating stores called the 'Shade Shop.' This Court held that the public interest merely in resolving their private unfair competition dispute would not justify the Commission in issuing a complaint. The courts of law are open to competitors for the settlement of their private legal rights, one against the other. The Board, under a mandate from Congress, is charged with the protection of the public interest as affected by practices of carriers in the field of air transportation. In exercising our function of review of the Board's jurisdiction to protect the public interest by a proceeding which may be generated from facts also giving rise to a private dispute, we must take account of the significant differences between § 5 and § 411. Section 5 is concerned with purely private business enterprises which cover the full spectrum of economic activity. On the other hand, the air carriers here conduct their business under a regulated system of limited competition. The business so conducted is of especial and essential concern to the public, as is true of all common carriers and public utilities. Finally, Congress has committed the regulation of this industry to an administrative agency of special competence that deals only with the problems of the industry.
10
The practices of the competitors here clashed in a field where Congress was specifically concerned to protect the public interest. Demonstrated confusion of the public as to the origin of major air transportation services may be of obvious national public concern. The criteria which the Board employed to determine whether the confusion here created a problem of concern to the public are contained in the following quotation from its report:
11
'* * * the record is convincing that the public interest requires this action in order to prevent further public confusion between respondent and intervenor due to similarity of names. The maintenance of high standards in dealing with the public is expected of common carriers, and the public has a right to be free of the inconveniences which flow from confusion between carriers engaging in the transportation of persons by air. The speed of air travel may well be diminished when passengers check in for flights with the wrong carrier, or attempt to retrieve baggage from the wrong carrier, or attempt to purchase transportation from the wrong carrier, or direct their inquiries to the wrong carrier. Friends, relatives or business associates planning to meet passengers or seeking information on delayed arrivals are subject to annoyance or worse when confused as to the carrier involved. The proper handling of complaints from members of the public is impeded by confusion as to the carrier to whom the complaint should be presented. The transportation itself may differ from what the confused purchaser had anticipated (e.g., in terms of equipment), even though the time and place of arrival may be about the same. It is obvious that public confusion between air carriers operating between the same cities is adverse to the public interest * * *.' Docket Nos. 5774 and 5928 (Nov. 4, 1953), 12—13 (mimeo).
12
Under § 411 it is the Board that speaks in the public interest. We do not sit to determine independently what is the public interest in matters of this kind, committed as they are to the judgment of the Board. We decide only whether, in determining what is the public interest, the Board has stayed within its jurisdiction and applied criteria appropriate to that determination. The Board has done that in the instant case. Considerations of the high standards required of common carriers in dealing with the public, convenience of the traveling public, speed and efficiency in air transport, and protection of reliance on a carrier's equipment are all criteria which the Board in its judgment may properly employ to determine whether the public interest justifies use of its powers under § 411.
13
It is argued that respondent's use of the name 'North American' cannot amount to an unfair or deceptive practice or an unfair method of competition authorizing the Board's order within § 411. 'Unfair or deceptive practices or unfair methods of competition,' as used in § 411, are broader concepts than the common-law idea of unfair competition. See Federal Trade Commission v. R. F. Keppel & Bro., Inc., supra; Federal Trade Commission v. Raladam Co., 283 U.S. 643, 648, 51 S.Ct. 587, 590, 75 L.Ed. 1324. The section is concerned not with punishment of wrongdoing or protection of injured competitors, but rather with protection of the public interest. See Federal Trade Commission v. Klesner, supra, 280 U.S. at pages 27—28, 50 S.Ct. at pages 3—4. The courts have held, in construing § 5 of the Trade Commission Act, that the use of a trade name that is similar to that of a competitor, which has the capacity to confuse, or deceive the public, may be prohibited by the Commission. Federal Trade Commission v. Algoma Lumber Co., 291 U.S. 67, 54 S.Ct. 315, 78 L.Ed. 655; Juvenile Shoe Co. v. Federal Trade Commission, 9 Cir., 289 F. 57. And see Pep Boys-Manny, Moe & Jack, Inc., v. Federal Trade Commission, 3 Cir., 122 F.2d 158, where the confusing name was not that of any competitor. The Board found that respondent knowingly adopted a trade name that might well cause confusion. But it made no findings that the use of the name was intentionally deceptive or fraudulent or that the competitor, American Airlines, was injured thereby. Such findings are not required of the Trade Commission under § 5, and there is no reason to require them of the Civil Aeronautics Board under § 411. Federal Trade Commission v. Algoma Lumber Co., supra, 291 U.S. at page 81, 54 S.Ct. at page 321; Eugene Dietzgen Co. v. Federal Trade Commission, 7 Cir., 142 F.2d 321, 327; D.D.D. Corp. v. Federal Trade Commission, 7 Cir., 125 F.2d 679, 682; Gimbel Bros., Inc., v. Federal Trade Commission, 2 Cir., 116 F.2d 578, 579; Federal Trade Commission v. Balme, 2 Cir., 23 F.2d 615, 621. See also S.Rep. No. 221, 75th Cong., 1st Sess. 2.
14
The Board had jurisdiction to inquire into the methods of competition presented here, and its evidentiary findings concerned confusion of the type which can support a finding of violation of § 411. The judgment of the Court of Appeals must therefore be reversed. However, since we do not understand the court to have decided whether the Board's findings were supported by substantial evidence on the record as a whole, the case is remanded to the Court of Appeals for further proceedings in the light of this opinion.
15
Reversed and remanded.
16
Mr. Justice DOUGLAS, with whom Mr. Justice REED concurs, dissenting.
17
The Court decides that a finding of 'substantial public confusion' resulting from respondent carrier's use of the name 'North American' constitutes a violation of § 411 of the Civil Aeronautics Act, 52 Stat. 1003, as amended, 66 Stat. 628, 49 U.S.C. § 491, 49 U.S.C.A. § 491.
18
If the Court held that the public confusion must be substantial enough to impair—or imminently threaten to impair—the efficiency of air service, I would agree. That construction would give practical content to the phrase 'substantial public confusion.' The Court, however, does not require a Board finding that the confusion has diminished the efficiency of air service. There is, indeed, no such finding by the Board in this case. There is only a naked finding of 'substantial public confusion' and that such confusion is 'likely to continue.' There is no finding that any flight was delayed because a passenger was confused; there is no finding that any passenger missed his plane because of checking in at the wrong ticket counter; there is no finding that a confused passenger boarded the wrong plane.
19
The Board conceded that its order requiring respondent to cease and desist from using the name 'North American' was 'a serious sanction which necessarily involves disturbance and loss to the carrier: * * * 'The maintenance of high standards in dealing with the public is expected of common carriers, and the public has a right to be free of the inconveniences which flow from confusion between carriers engaging in the transportation of persons by air. The speed of air travel may well be diminished when passengers check in for flights with the wrong carrier, or attempt to retrieve baggage from the wrong carrier, or attempt to purchase transportation from the wrong carrier, or direct their inquiries to the wrong carrier.' Docket Nos. 5774 and 5928 (Nov. 4, 1953), 12—13 (mimeo). (Italics added.)
20
I would not permit the Board to find a violation of § 411 so easily. We should require a finding that the confusion has actually caused some impairment of air service or that at least there is an imminent threat of such impairment. Certainly the type of confusion found here 'may well' diminish the speed of air travel—if it grows to such major proportions that flights are delayed and passengers begin missing flights or boarding the wrong planes. But it is mere conjecture that that will ever happen as a result of respondent's use of the name 'North American.' The type and extent of public confusion found by the Board here would probably also be found if the Board conducted a similar inquiry into passenger confusion between Pan-American and American Airlines. It would also be surprising if the Board could not find similar confusion between Eastern and Northeast Airlines, Western and Northwest Airlines, or, if the Board had jurisdiction in the railroad industry, among Northern Pacific, Union Pacific, Western Pacific and Southern Pacific. As the dissenting member of the Board said:
21
'Since American Airlines, Inc., carries approximately 5 1/2 million passengers each year over its system, I am not impressed with the fact that witnesses in this case (principally those employed by American Airlines itself) have testified that some confusion has existed between the services offered by American, on the one hand, and North American on the other. On the contrary, I would be greatly surprised, (in view of the several million phone calls and other communications which American Airlines receives every year over and above those received from passengers which it actually carries) if there were not some demonstrable public confusion between American Airlines and the respondent in this case.' Id., at 1—2 (dissenting opinion).
22
The Court relies on the cases arising under § 5 of the Federal Trade Commission Act, 38 Stat. 719, as amended, 15 U.S.C. § 45, 15 U.S.C.A. § 45. Federal Trade Commission v. Algoma Lumber Co., 291 U.S. 67, 54 S.Ct. 315, 78 L.Ed. 655; Juvenile Shoe Co. v. Federal Trade Commission, 9 Cir., 289 F. 57; Pep Boys-Manny, Moe & Jack, Inc., v. Federal Trade Commission, 3 Cir., 122 F.2d 158. Those cases are quite different. In each the Commission made more than a bald finding of 'substantial public confusion.' It found, in the Algoma Lumber case, that a substantial number of purchasers had been misled into buying something other than what they thought they were buying. 291 U.S. at page 72, 54 S.Ct. at page 317. In the Juvenile Shoe case, the competitor took a name so similar ('Juvenile Shoe Corporation' and "Juvenile Shoe Company, Inc.") that confusion in the public mind was 'inevitable.' 289 F. at page 58. And the Commission made a finding that the use of the word 'Juvenile' caused confusion and led purchasers to believe that the goods of one company were the goods of the other company. Id., 289 F. at page 59. In the Pep Boys case, the court approved the following test: '* * * whether the natural and probable result of the use by petitioner of the name * * * makes the average purchaser unwittingly, under ordinary conditions purchase that which he did not intend to buy.' 122 F.2d at page 161.
23
There are no similar findings in the instant case. There is no finding here that a passenger bought a North American ticket and flew North American under the mistaken belief that he was flying American. There is no finding that any passenger missed a plane because of the confusion. If passengers mistakenly bought North American service, believing it to be American, a finding of unfair or deceptive practices or unfair methods of competition under § 411 would be justified. That is a type of public confusion quite different from the confusion found in this case reporting to the wrong ticket counter or attempting to retrieve baggage from the wrong carrier. By analogy to the § 5 cases, we have here a situation where a few prospective purchasers walked into the wrong store, but never made any purchases there.
24
I would affirm the judgment of the Court of Appeals.
1
See Hearings before a Subcommittee of the Senate Committee on Interstate Commerce on S. 3659, 75th Cong., 3d Sess. 5; 83 Cong.Rec. 6726; Hearings before a Subcommittee of the Senate Committee on Interstate Commerce on S. 2 and S. 1760, 75th Cong., 1st Sess., Pt. 1, 74.
| 78
|
351 U.S. 40
76 S.Ct. 569
100 L.Ed. 910
FROZEN FOOD EXPRESS, Appellant,v.UNITED STATES and I.C.C. INTERSTATE COMMERCE COMMISSION, Appellant, v. FROZEN FOOD EXPRESS et al. AMERICAN TRUCKING ASSOCIATIONS, Inc., et al., Appellants, v. FROZEN FOOD EXPRESS et al. AKRON, CANTON AND YOUNGSTOWN R. CO. et al., Appellants, v. FROZEN FOOD EXPRESS et al.
Nos. 158—161.
Argued and Submitted March 7, 1956.
Decided April 23, 1956.
Mr.Robert W. Ginnane, Washington, D.C., for I.C.C.
Mr. David G. Macdonald, Washington, .d.C., for East Texas Motor Freight Lines, et al.
Mr. Carl L. Phinney, Dallas, Tex., for Frozen Food Express.
Messrs. Charles P. Reynolds, Washington, d.C., and Carl Helmetag, Jr., Philadelphia, Pa., for appellant Railroads.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
Part II of the Interstate Commerce Act, 49 Stat. 543, as amended, 49 U.S.C. § 301 et seq., 49 U.S.C.A. § 301 et seq., grants the Commission pervasive control over motor carriers. Common carriers and contract carriers by motor vehicle, subject to that part of the Act, must have a certificate of public convenience and necessity or a permit issued by the Commission. §§ 206(a), 209(a). The Commission has powers of investigation to determine if a motor carrier has complied with the Act; and it has authority to issue an order compelling compliance. § 204(c). These requirements for a certificate or permit* are not, however, applicable to 'motor vehicles used in carrying property consisting of ordinary livestock, fish (including shell fish), or agricultural (including horticultural) commodities (not including manufactured products thereof), if such motor vehicles are not used in carrying any other property, or passengers for compensation.' § 203(b)(6).
2
The controversy in these cases centers around this 'agricultural' exemption. After an investigation instituted on its own motion, the Commission issued an order that specified commodities are not 'agricultural' within the meaning of § 203(b)(6).
3
The hearing to determine the meaning and application of the term 'agricultural * * * commodities (not including manufactured products thereof)' as used in § 203(b)(6) was held before an examiner. It was a public hearing at which various governmental officials and agencies and various producers, shippers, and carriers appeared and presented evidence. The Commission's decision was in the form of a report and order. 52 M.C.C. 511. The report, which concerns various groups of commodities, covers 71 pages of the printed record. The findings list those commodities that the Commission finds are exempted under § 203(b)(6) and those that are not. The order of the Commission incorporates the 'findings' and states that the proceeding 'be, and it is hereby discontinued.'
4
Frozen Food Express, the plaintiff, is a motor carrier transporting numerous commodities which the Commission ruled were nonexempt under § 203(b)(6) but which the carrier claims are 'agricultural commodities.' Plaintiff, who was not a party to the administrative proceeding, instituted suit before a three-judge District Court, 28 U.S.C. § 2325, 28 U.S.C.A. § 2325, to enjoin the order of the Commission and have it set aside, naming the United States and the Commission as defendants. 28 U.S.C. § 1336, 28 U.S.C.A. § 1336; 49 Stat. 550, as amended, 49 U.S.C. § 305(g), 49 U.S.C.A. § 305(g); 60 Stat. 243, 5 U.S.C. § 1009, 5 U.S.C.A. § 1009. The complaint alleged that plaintiff is a common carrier by motor vehicle, holding a certificate of public convenience and necessity which authorizes it to transport certain commodities between designated points and places; that plaintiff is transporting, in addition to those commodities, commodities which are exempt under § 203(b)(6) and for which plaintiff has sought no authority from the Commission; that the Commission in its order has held the latter commodities nonexempt and accordingly has deprived it of the right granted by the statute; that the order of the Commission classifying certain commodities as nonexempt is unlawful; and that the Commission threatens to enjoin transportation of the commodities which plaintiff claims are exempt. The Secretary of Agriculture intervened, supporting plaintiff's position on some of the commodities. Other interveners are trucking associations and railroads which support the Commission. The United States as a defendant supports the Commission on some of its findings and opposes it on others.
5
The District Court, being of the view that the case was controlled by United States v. Los Angeles & S.L.R. Co., 273 U.S. 299, 47 S.Ct. 413, 71 L.Ed. 651, dismissed the action, saying that the 'order' of the Commission was not subject to judicial review. 128 F.Supp. 374. The cases are here by appeal. 28 U.S.C. §§ 1253, 2101(b), 28 U.S.C.A. §§ 1253, 2101(b).
6
We disagree with the District Court. We do not think United States v. Los Angeles & S.L.R. Co., supra, is controlling here. In that case the 'order' held nonreviewable was a valuation of a carrier's property made by the Commission. The Court held that the 'order' was no more than a report of an investigation which might never be the basis of a proceeding before the Commission or a court. Mr. Justice Brandeis, speaking for the Court, said:
7
'The so-called order here complained of is one which does not command the carrier to do, or to refrain from doing, any thing; which does not grant or withhold any authority, privilege, or license; which does not extend or abridge any power or facility; which does not subject the carrier to any liability, civil or criminal; which does not change the carrier's existing or future status or condition; which does not determine any right or obligation. This so-called order is merely the formal record of conclusions reached after a study of data collected in the course of extensive research conducted by the Commission, through its employees. It is the exercise solely of the function of investigation. * * *' 273 U.S. 309—310, 47 S.Ct. 413, 414, 71 L.Ed. 651.
8
The situation here is quite different. The determination by the Commission that a commodity is not an exempt agricultural product has an immediate and practical impact on carriers who are transporting the commodities, and on shippers as well. The 'order' of the Commission warns every carrier, who does not have authority from the Commission to transport those commodities, that it does so at the risk of incurring criminal penalties. § 222(a). Where unauthorized operations occur, the Commission may proceed administratively and issue a cease and desist order. § 204(c). Such orders of the Commission are enforceable by the courts. § 222(b). And wilful violation of a cease and desist order is ground for revocation of a certificate or permit. § 212. The determination made by the Commission is not therefore abstract, theoretical, or academic. Cf. El Dorado Oil Works v. United States, 328 U.S. 12, 18—19, 66 S.Ct. 843, 846—847, 90 L.Ed. 1053. The 'order' of the Commission which classifies commodities as exempt or nonexempt is, indeed, the basis for carriers in ordering and arranging their affairs. Cf. Rochester Telephone Corp. v. United States, 307 U.S. 125, 132, 59 S.Ct. 754, 757, 758, 83 L.Ed. 1147. Carriers who are without the appropriate certificate or permit, because they believe they carry exempt commodities, run civil and criminal risks. A carrier authorized to carry specified commodities and dependent on exempt articles for its return load may lose its right to operate at all, if it does not respect the Commission's 'order.' Carriers and shippers alike are told that they are or are not free to bargain for rates, that they must or must not pay the filed charges. The 'order' of the Commission is in substance a 'declaratory' one, see 60 Stat. 240, 5 U.S.C. § 1004(d), 5 U.S.C.A. § 1004(d), which touches vital interests of carriers and shippers alike and sets the standard for shaping the manner in which an important segment of the trucking business will be done. Cf. Columbia Broadcasting System v. United States, 316 U.S. 407, 62 S.Ct. 1194, 86 L.Ed. 1563. The consequences we have summarized are not conjectural. The Commission itself places this interpretation on its action and argues, contrary to its position in the Los Angeles case, supra, for finality of the order. We conclude that the issues raised in the complaint are justiciable and that the District Court should adjudicate the merits.
9
Reversed.
10
Mr. Justice HARLAN, dissenting.
11
I do not agree that the District Court had jurisdiction to entertain this action to set aside the Commission's 'order.' It seems to me that the case falls squarely within those carefully developed rules which require that judicial intervention be withheld until administrative action has reached its complete development. I find nothing in the nature of the order which commends it to reviewability at this stage other than the fact that its promulgation was preceded by a lengthy investigation and that it contains a series of 'findings' and 'conclusions.' These factors should not be permitted to obscure the true character of the order.
12
After a self-initiated investigation, in which various carriers participated, the Commission entered this order discontinuing the proceedings and incorporating the 'findings of fact and conclusions' of the Commission. That the order was not intended to be a 'legislative' regulation seems apparent, since it was not put in the form ordinarily used by the Commission in promulgating regulations. The order simply lists the commodities considered by the Commission and determines whether they are within the § 203(b)(6) exemption; it nowhere commands that carriers hauling commodities considered non-exempt comply either with the order or with the general requirements of the Interstate Commerce Act. It is clear, therefore, that no administrative or criminal proceeding can be brought for violation of the order itself. And it is equally clear that the proceeding did not conclude any rights as between any specific carriers and the Commission.
13
The Interstate Commerce Act does, of course, provide for administrative and criminal sanctions to enforce compliance with its provisions. An uncertificated carrier hauling commodities non-exempt under § 203(b)(6) runs the risk of a criminal prosecution under § 222(a) of the Act. But the order has no operative effect in such a proceeding—it does not extend the carrier's criminal liability, which exists because of a violation of the Act and not the order. And if the enforcement takes the form of a cease and desist proceeding against a particular carrier, again the only question would be whether the Act, rather than the order, was being violated. If such an administrative proceeding is instituted, and a cease and desist order is issued, the carrier subject to that order would be entitled to contest the statutory authority of the Commission in judicial proceedings of precisely the scope brought here.
14
Nor can this order be likened to a determination of status, held reviewable in Rochester Telephone Corp. v. United States, 307 U.S. 125, 59 S.Ct. 754, 83 L.Ed. 1147. As I understand that case, the touchstone of the decision was that the determination 'necessarily and immediately carried direction of obedience to previously formulated mandatory orders addressed generally to all carriers amenable to the Commission's authority.' 307 U.S. at page 144, 59 S.Ct. at page 764. The specific determination that a particular carrier must comply with Commission regulations is quite different from this order, which is directed to no one in particular and is binding on no one, not even the Commission. Neither can this order be analogized to a declaratory order directed to the status of a particular carrier, which might be reviewable as carrying with it a direct threat of prosecution—see Rochester Telephone Corp. v. United States, supra, 307 U.S. at page 132, 59 S.Ct. at page 758, note 11. Indeed, the Commission itself does not consider its determinations the final answer to the meaning of the § 203(b)(6) exemption, even for administrative purposes. This is evident from the proceedings in East Texas Motor Freight Lines v. Frozen Food Express, 350 U.S. 49, 76 S.Ct. 574, where in a cease and desist proceeding the Commission heard new evidence on whether the particular commodities there involved were within the exemption, and was evidently ready to reconsider the determinations embodied in the order involved here.
15
To be sure, the order does serve as a warning to carriers that the Commission interprets the Act in a particular way, and it is true that courts will give the Commission's views some indeterminate weight in construing the statute. But that very fact, instead of justifying a holding of reviewability, seems to me a strong argument against it. The Commission's willingness, in individual cases, to reconsider its determinations with respect to particular commodities points up the tentative nature of the conclusions here sought to be reviewed. When this action is heard on the merits, the District Court will have as an aid in construing the statute administrative interpretations which are admittedly inconclusive, and if they are to be given any weight it would seem important that this Court not do anything to freeze them in their present immature state. For all we know, the Commission's decision not to issue this order in the form of regulations may have been because it recognized the need for further study.
16
Years of experience have shown that § 203(b)(6) presents difficult problems of interpretation, and this Court should be wary of establishing a procedure which would prematurely throw into the courts questions of statutory construction not arising in the context of concrete facts, and which does not bring to the courts even the benefit of final interpretation by the agency assigned to administer the statute. That this should be done in a case where there is a right of direct appeal to this Court makes the wisdom of today's decision even more questionable.
17
Lastly, the order does not have the immediate impact of the sort which, at times, has led this Court to regard particular administrative action as ripe for judicial review. In Columbia Broadcasting System v. United States, 316 U.S. 407, 62 S.Ct. 1194, 86 L.Ed. 1563, the very existence of the regulations had, without anything more, an immediate effect on the business of the party attacking them. There is much to be said for finding administrative action reviewable when it entails immediate practical consequences for those affected by it. Cf. Joint Anti-Fascist Refugee Committee v. McGrath, 341 U.S. 123, 71 S.Ct. 624, 95 L.Ed. 817. But the carriers subject to the Interstate Commerce Act are in no way worse off now than they were before this order issued; there is no greater liability or risk under the statute occasioned by the order, which has no more effect than would any other informal expression of views by the Commission. If anything, carriers are in a better position, since they can now make a more reasoned judgment as to the applicability of the statute to particular commodities, and this may have been the principal reason for jthe Commission making public its findings.
18
In my view, then, the language quoted by the majority from United States v. Los Angeles & S.L.R. Co. aptly describes this order of the Commission, and I consider that wise decision controlling here. Neither the character nor the meaning of this order can be changed by the fact that the Commission, in asking us to hold it reviewable, calls it a 'formal determination' of the scope of § 203(b)(6). The significant fact is that, as shown by East Texas Motor Freight Lines v. Frozen Foods Express, 350 U.S. 49, 76 S.Ct. 574, the Commission itself does not consider its order definitive. Today's decision opens the door wide to premature judicial review of various kinds of administrative action, and I must withhold my assent from it. I would affirm the decision below.
*
Exempted carriers are also not subject to the provisions concerning rates and charges, §§ 217, 218, nor to the requirements concerning bodily injury and property damage insurance. § 215.
| 89
|
351 U.S. 131
76 S.Ct. 685
100 L.Ed. 1013
Louis BERRA, Petitioner,v.UNITED STATES of America.
No. 60.
Argued March 26, 1956.
Decided April 30, 1956.
Mr.
Stanley M. Rosenblum, St. Louis, Mo., for petitioner.
Mr. Philip Elman, Washington, D.C., for respondent.
Mr. Justice HARLAN delivered the opinion of the Court.
1
Petitioner was charged, in a three-count indictment, with wilfully attempting to evade federal income taxes for 1951, 1952, and 1953 by filing with the Collector 'false and fraudulent' tax returns, 'in violation of Section 145(b), Title 26, United States Code.'1 That section of the Internal Revenue Code of 1939, 26 U.S.C.A., 53 Stat. 63, provided:
2
'Any person * * * who willfully attempts in any manner to evade or defeat any tax imposed by this chapter or the payment thereof, shall, in addition to other penalties provided by law, be guilty of a felony and, upon conviction thereof, be fined not more than $10,000, or imprisoned for not more than five years, or both, together with the costs of prosecution.'
3
Section 3616(a) of the 1939 Code, 53 Stat. 440, also made it a crime for any person to deliver to the Collector 'any false or fraudulent list, return, account, or statement, with intent to defeat or evade the valuation, enumeration, or assessment intended to be made * * *.' The penalty for violation of § 3616(a), however, was a fine of not more than $1,000, or imprisonment not exceeding one year, or both, together with the costs of prosecution.
4
At the close of the trial judge's charge to the jury, petitioner asked that the jury be instructed with respect to each count that a verdict of guilty of the 'lesser crime' under § 3616(a) would be permissible.2 No motions addressed to the validity of the indictment, judgment of conviction, or sentence under § 145(b) were made before, during, or after trial, and we read the requested instruction as aimed at leaving to the jury the question of whether the defendant should be convicted under § 145(b) or § 3616(a), if the jury found him guilty. The instruction was refused, and, after conviction, petitioner was sentenced to four years' imprisonment on each count, the sentences to run concurrently. Thus petitioner has been sentenced to imprisonment greater than the maximum possibile had the conviction been under § 3616(a) alone. The Court of Appeals affirmed, 8 Cir., 221 F.2d 590, and we granted certiorari, 350 U.S. 910, 76 S.Ct. 190, limited to the question of whether it was error for the trial judge to refuse to give the requested instruction.
5
The Court of Appeals, in affirming the conviction, held that § 3616(a) did not apply to income tax returns, and that any instruction relating to that section would therefore have been irrelevant under the evidence in this case.3 Both parties agree, however, that § 3616(a) was applicable to income tax returns, and we shall assume, arguendo, the correctness of that interpretation of the statute.
6
Rule 31(c) of the Federal Rules of Criminal Procedure, 18 U.S.C.A., provides that a defendant may be found guilty of an offense 'necessarily included in the offense charged.'4 In a case where some of the elements of the crime charged themselves constitute a lesser crime, the defendant, if the evidence justified it, would no doubt be entitled to an instruction which would permit a finding of guilt of the lesser offense. See Stevenson v. United States, 162 U.S. 313, 16 S.Ct. 839, 40 L.Ed. 980. But this is not such a case. For here the method of evasion charged was the filing of a false return, and it is apparent that the facts necessary to prove that petitioner 'willfully' attempted to evade taxes by filing a false return, § 145(b), were identical with those required to prove that he delivered a false return with 'intent' to evade taxes, § 3616(a). In this instance §§ 145(b) and 3616(a) covered precisely the same ground.5
7
Petitioner contends that he was nevertheless entitled to the requested instruction. He argues that since there was no difference in the proof required to establish violations of §§ 145(b) and 3616(a), the indictment must be taken as charging violations of both sections, and the jury under Rule 31(c) should have been permitted to make the choice between the two crimes. We do not agree.
8
The role of the jury in a federal criminal case is to decide only the issues of fact, taking the law as given by the court. Sparf v. United States, 156 U.S. 51, 102, 15 S.Ct. 273, 293, 39 L.Ed. 343. Certainly Rule 31(c) was never intended to change this traditional function of the jury.6 Here, whether s 145(b) or § 3616(a) be deemed to govern, the factual issues to be submitted to the jury were the same; the instruction requested by petitioner would not have added any other such issue for the jury's determination.7 When the jury resolved those issues against petitioner, its function was exhausted, since there is here no statutory provision giving to the jury the right to determine the punishment to be imposed after the determination of guilt.8 Whatever other questions might have been raised as to the validity of petitioner's conviction and sentence, because of the assumed overlapping of §§ 145(b) and 3616(a), were questions of law for the court. No such questions are presented here.
9
The only question before us is whether the jury should have been allowed to decide whether it would apply § 3616(a) rather than § 145(b), and that we hold was not for the jury. It was, therefore, not error to refuse the requested instruction.
10
Affirmed.
11
Mr. Justice BLACK, with whom Mr. Justice DOUGLAS joins (dissenting).
12
The petitioner here was convicted on three counts under an indictment charging that he 'did willfully and knowingly attempt to evade and defeat a large part of the income tax due and owing by him and his wife * * * by filing * * * a false and fraudulent joint income tax return * * * In violation of Section 145(b), Title 26, United States Code.' Section 145(b) provides that:
13
'any person who willfully attempts in any manner to evade or defeat any tax imposed by this chapter * * * shall, in addition to other penalties provided by law, be guilty of a felony and, upon conviction thereof, be fined not more than $10,000, or imprisoned for not more than five years, or both, together with the costs of prosecution.' (Emphasis added.)1
14
The offense charged in the indictment, filing a fraudulent return, could be held to be proscribed by § 145(b) because of the phrase 'in any manner.' But certainly it falls squarely within the specific language of 26 U.S.C. § 3616(a), 26 U.S.C.A. § 3616(a), which provides that any person who
15
'Delivers or discloses to the collector or deputy any false or fraudulent list, return, account, or statement, with intent to defeat or evade the * * * assessment intended to be made * * * shall be fined not exceeding $1,000, or be imprisoned not exceeding one year, or both, at the discretion of the court, with costs of prosecution.' (Emphasis added.)2
16
At an appropriate time the petitioner asked the trial judge to charge the jury that if the allegations of the indictment had been proven they should find the petitioner guilty of a misdemeanor under § 3616(a). Although § 3616(a) unambiguously makes the conduct charged a misdemeanor punishable by no more than one year in prison, the trial judge apparently felt that he was compelled to treat the offense as a felony because of the statement in the indictment that the conduct charged was 'In violation of Section 145(b) * * *.'3 The judge not only refused the requested instruction, but after the jury returned a verdict of guilty, he sentenced petitioner to serve four years in prison on each of the three counts, the sentences to run concurrently.
17
Regardless of whether it was error to refuse the requested instruction, the record raises a serious question as to whether the four-year sentence on each count was lawfully imposed. The Court's opinion takes the position that no proper challenges to the sentence under the felony statute were raised below and hence that 'No such questions are presented here.'4 In my judgment the requested instruction was adequate to call the trial judge's attention to petitioner's contention that the offense charged was not a felony but a misdemeanor. But even if the question should have been raised again when the judge announced the sentence, 'Plain errors or defects affecting substantial rights may be noticed although they were not brought to the attention of the court.' Fed.Rules Crim.Proc. 52(b), 18 U.S.C.A. See also Wiborg v. United States, 163 U.S. 632, 658, 16 S.Ct. 1127, 1137, 1197, 41 L.Ed. 289. Since I think petitioner is right in saying the offense charged was only a misdemeanor, I think we should correct the plain error of the trial judge in sentencing petitioner under the felony statute.
18
The Government admits here and the Court assumes that filing a false and fraudulent income tax return is both a misdemeanor under § 3616(a) and a felony under § 145(b). The Government argues that the action of the trial judge must be upheld because 'the Government may choose to invoke either applicable law,' and 'the prosecution may be for a felony even though the Government could have elected to prosecute for a misdemeanor.' Election by the Government of course means election by a prosecuting attorney or the Attorney General.5 I object to any such interpretation of §§ 145 and 3616. In think we should construe these sections so as not to place control over the liberty of citizens in the unreviewable discretion of one individual—a resutl which seems to me to be wholly incompatible with our system of justice. Since Congress has specifically made the conduct charged in the indictment a misdemeanor, I would not permit prosecution for a felony under the broad language of § 145(b). Criminal statutes, which forfeit life, liberty or property, should be construed narrowly, not broadly.
19
So far as I know, this Court has never approved the argument the Government makes here. It certainly did not do so in United States v. Beacon Brass Co., 344 U.S. 43, 73 S.Ct. 77, 97 L.Ed. 61, upon which the Government seems to rely. In that case the Court said:
20
'We have before us two statutes, each of which proscribes conduct not covered by the other, but which overlap in a narrow area illustrated by the instant case. At least where different proof is required for each offense, a single act or transaction may violate more than one criminal statute. * * *' 344 U.S. at page 45, 73 S.Ct. at page 78.
21
Here, however, under the Court's opinion and the Government's argument, two statutes proscribe identical conduct and no 'different proof' was required to convict petitioner of the felony than would have been required to convict him of the misdemeanor. The Government's whole argument rests on the stark premise that Congress has left to the district attorney or the Attorney General the power to say whether the judge and jury must punish identical conduct as a felony or as a misdemeanor.
22
A basic principle of our criminal law is that the Government only prosecutes people for crimes under statutes passed by Congress which fairly and clearly define the conduct made criminal and the punishment which can be administered.6 This basic principle is flouted if either of these statutes can be selected as the controlling law at the whim of the prosecuting attorney or the Attorney General. 'For the very idea that one man may be compelled to hold his life, or the means of living, or any material right essential to the enjoyment of life, at the mere will of another, seems to be intolerable in any country where freedom prevails, as being the essence of slavery itself.' Yick Wo v. Hopkins, 118 U.S. 356, 370, 6 S.Ct. 1064, 1071, 30 L.Ed. 220.
23
A congressional delegation of such vast power to the prosecuting department would raise serious constitutional questions. Of course it is true that under our system Congress may vest the judge and jury with broad power to say how much punishment shall be imposed for a particular offense. But it is quite different to vest such powers in a prosecuting attorney. A judge and jury act under procedural rules carefully prescribed to protect the liberty of the individual. Their judgments and verdicts are reached after a public trial in which a defendant has the right to be represented by an attorney. No such protections are thrown around decisions by a prosecuting attorney. Substitution of the prosecutor's caprice for the adjudicatory process is an action I am not willing to attribute to Congress in the absence of clear command. Our system of justice rests on the conception of impersonality in the criminal law. This great protection to freedom is lost if the Government is right in its contention here. See dissenting opinion in Rosenberg v. United States, 346 U.S. 273, 306, 73 S.Ct. 1152, 1168, 97 L.Ed. 1607.
24
The Government's contention here also challenges our concept that all people must be treated alike under the law. This principle means that no different or higher punishment should be imposed upon one than upon another if the offense and the circumstances are the same. It is true that there may be differences due to different appraisals given the circumstances of different cases by different judges and juries. But in these cases the discretion in regard to conviction and punishment for crime is exercised by the judge and jury in their constitutional capacities in the administration of justice.
25
I would reverse this case or at least remand for resentencing under the misdemeanor statute, § 3616(a).
1
This case arises under the Internal Revenue Code of 1939. The sections involved have been changed in the 1954 Code, 26 U.S.C.A.; see §§ 7201, 7207, 68a Stat. 851, 853.
2
'Defendant's Requested Instruction No. 12.
'Under the law you may find the defendant guilty of a lesser crime than the crime charged in each count of the income tax indictment.
'The statute upon which the lesser crime is based, omitting that part of the act which does not apply in this case, reads as follows:
'Whenever any person * * * delivers or discloses to a collector * * * any false or fraudulent * * * return * * * with intent to defeat or evade the * * * assessment intended to be made, shall be guilty of a misdemeanor.
'Under Count I if you find and believe from the evidence that the defendant delivered, caused to be delivered or disclosed to the Collector of Internal Revenue for the First Collection District of Missouri, a false income tax return with intent to defeat or evade the assessment intended to be made, you will find him guilty of this lesser crime.' (This paragraph was repeated for Counts II and III.)
3
In so holding the Court of Appeals followed its earlier decision in Dillon v. United States, 8 Cir., 218 F.2d 97.
4
'Rule 31. Verdict * * * (c) Conviction of Less Offense. The defendant may be found guilty of an offense necessarily included in the offense charged or of an attempt to commit either the offense charged or an offense necessarily included therein if the attempt is an offense.'
5
Compare § 7207 of the Internal Revenue Code of 1954, under which the wilful filing of a false return no longer requires the element of an 'intent to defeat or evade' taxes, as was so under the former § 3616(a).
6
The Notes of the Advisory Committee state that Rule 31(c) 'is a restatement of existing law.' The preceding 'lesser offense' statutes were Act of June 1, 1872, 17 Stat. 196, 198; R.S. § 1035; 18 U.S.C. § 565. Cf. Stevenson v. United States, supra, 162 U.S. at pages 315, 322, 323, 16 S.Ct. at page 842; Sparf v. United States, supra, 156 U.S. at page 103, 15 S.Ct. at page 293; Ekberg v. United States, 1 Cir., 167 F.2d 380, 385.
7
Indeed, had there been any separate factual issues under § 3616(a), it is plain that the requested instruction would have been inadequate to raise them for the jury.
8
Cf. Andres v. United State, 333 U.S. 740, 68 S.Ct. 880, 92 L.Ed. 1055.
1
Internal Revenue Code of 1939, 53 Stat. 63. Cf. § 7201, Internal Revenue Code of 1954, 68 A Stat. 851, 26 U.S.C.A.
2
Internal Revenue Code of 1939, 53 Stat. 440. Cf. §§ 7206(1), 7207, Internal Revenue Code of 1954.
3
But see Williams v. United States, 168 U.S. 382, 389, 18 S.Ct. 92, 94, 42 L.Ed. 509; United States v. Hutcheson, 312 U.S. 219, 229, 61 S.Ct. 463, 464, 85 L.Ed. 788; Fed.Rules Crim.Proc. 7(c), 18 U.S.C.A., which provides in part that: 'The indictment * * * shall state for each count the official or customary citation of the statute * * * which the defendant is alleged therein to have violated. Error in the citation or its omission shall not be ground for dismissal of the indictment * * * or for reversal of a conviction if the error or omission did not mislead the defendant to his prejudice.' Cf. Cole v. State of Arkansas, 333 U.S. 196, 68 S.Ct. 514, 92 L.Ed. 644.
4
Apparently the Court means by this to leave open to petitioner the opportunity to challenge his sentence by a motion to correct it under 28 U.S.C. § 2255, 28 U.S.C.A. § 2255. Of course I agree that a motion under that section would be appropriate, but I think petitioner is entitled to have it settled now.
5
This would always follow where an information is used. And where there is an indictment by grand jury of course the indictment is drawn by the prosecuting attorney, since grand juries normally are not familiar with the applicable statutes. Thus where a prosecuting officer seeks an indictment under a statute making an attempt to evade taxes in any manner a felony, it would be a rare grand juror indeed who would be sufficiently familiar with the Internal Revenue Code to suggest that it might be better to bring the indictment under § 3616(a).
6
See, e.g., International Harvester Co. of America v. Commonwealth of Kentucky, 234 U.S. 216, 34 S.Ct. 853, 58 L.Ed. 1284; Connally v. General Construction Co., 269 U.S. 385, 391—392, 46 S.Ct. 126, 127—128, 70 L.Ed. 322.
| 01
|
351 U.S. 115
76 S.Ct. 663
100 L.Ed. 1003
COMMUNIST PARTY OF THE UNITED STATES of America, Petitioner,v.SUBVERSIVE ACTIVITIES CONTROL BOARD.
No. 48.
Argued Nov. 17, 1955.
Decided April 30, 1956.
Messrs.John J. Abt, New York City, Joseph Forer, Washington, D.C., for petitioner.
Mr. Simon E. Sobeloff, Sol. Gen., Washington, D.C., for respondent.
Mr. Justice FRANKFURTER delivered the opinion of the Court.
1
This case is here to review the judgment of the Court of Appeals for the District of Columbia affirming an order of the Subversive Activities Control Board that petitioner register with the Attorney General as a 'Communist-action' organization, as required by the Subversive Activities Control Act of 1950, Title I of the Internal Security Act of 1950, 64 Stat. 987, 50 U.S.C.A. § 781 et seq. That Act sets forth a comprehensive plan for regulation of 'Communist-action' organizations.1 Section 2 of the Act describes a world Communist movement directed from abroad and designed to overthrow the Government of the United States by any means available, including violence. Section 7 requires all Communist-action organizations to register as such with the Attorney General. If the Attorney General has reason to believe that an organization, which has not registered, is a Communist-action organization, he is required by § 13(a) to bring a proceeding to determine that fact before the Subversive Activities Control Board, a five-man board appointed by the President with the advice and consent of the Senate and created for the purpose of holding hearings and making such determinations. Section 13(e) lays down certain standards for judgment by the Board.
2
If the Board finds that an organization is a Communist-action organization, it enters an order requiring the organization to register with the Attorney General. § 13(g). Section 14 provides the right to file a petition for review of Board action in the Court of Appeals for the District of Columbia, with opportunity for review by this Court upon certiorari. Once an organization registers or there is outstanding a final order of the Board requiring it to register, several consequences follow with respect to the organization and its members, but these need not now be detailed. See §§ 4, 5, 6, 7, 8, 10, 11, 15, 22, 25, 50 U.S.C.A. §§ 783—787, 789, 790, 792(a, e, g), 793, 794; 8 U.S.C.A. §§ 1424(a—c), 1427(f), 1451(c).
3
Proceeding under § 13(a) of this statute, the Attorney General, on November 22, 1950, petitioned the Board for an order directing petitioner to register pursuant to § 7 of the Act. Petitioner sought unsuccessfully by numerous motions before the Board and by proceedings in the United States District Court for the District of Columbia—one case is reported at 96 F.Supp. 47 (Communist Party of United States of America v. McGrath)—to attack the validity of, and to abort, the hearing. The hearing began on April 23, 1951, before three members of the Board, later reduced to two, sitting as a hearing panel, and it terminated on July 1, 1952. Proposed findings of fact and briefs were filed by both parties, and oral argument was held before the hearing panel in August 1952. In October 1952 the hearing panel issued a recommended decision that the Board order petitioner to register as a Communist-action organization. Exceptions to the panel's findings were filed by both parties, and oral argument was held before the Board in January 1953. The Board filed its report, which occupies 251 pages of the record in this case, on April 20, 1953.
4
In its report the Board found that there existed a world Communist movement, substantially as described in § 2 of the Act, organized and directed by a foreign government. The Board detailed the history of the Communist Party of the United States and its close relation to the world Communist movement. It then set forth illustrative evidence and made findings with respect to the statutory criteria of § 13(e) of the Act, which required the Board to consider 'the extent to which' the organization met them.2 The Board found that the conditions set forth in each of the paragraphs were applicable to petitioner. On the basis of these findings the Board concluded that petitioner was a Communist-action organization, as defined by § 3, and ordered it to register as such with the Attorney General.
5
Petitioner brought this order to the Court of Appeals for the District of Columbia for review. While the case was pending, it filed a motion, supported by affidavit, for leave to adduce additional evidence pursuant to § 14(a) of the Act.3 The basis of the motion was that the additional material evidence became available to the petitioner subsequent to the administrative proceeding and that this evidence would
6
'establish that the testimony of three of the witnesses for the Attorney General, on which (the Board) relied extensively and heavily in making findings which are of key importance to the order now under review, was false. * * * In summary, this evidence will establish that Crouch, Johnson and Matusow, all professional informers heretofore employed by the Department of Justice as witnesses in numerous proceedings, have committed perjury, are completely untrustworthy and should be accorded no credence; that at least two of them are now being investigated for perjury by the Department of Justice, and that because their character as professional perjurors (sic) has now been conclusively and publicly demonstrated, the Attorney General has ceased to employ any of them as witnesses.'
7
Petitioner listed a number of witnesses whom it proposed to call to substantiate its claim and also set forth a detailed affidavit in support of its allegations.
8
The Government did not deny these allegations. It filed a 'Memorandum in Opposition to Motion for Leave to Adduce Additional Evidence,' signed by the General Counsel to the Board and by officials of the Department of Justice. The memorandum asserted that the hearing should not be reopened for the receipt of evidence merely questioning, as it claimed, the credibility of some witnesses, but not any fact at issue, and it maintained that the findings of the Board were amply supported by evidence apart from the testimony of the three witnesses sought to be discredited. On December 23, 1954, this motion was formally denied by the Court of Appeals without opinion. In its full opinion on the merits, filed the same day, however, the Court of Appeals supported its rejection of petitioner's motion:
9
'The Party attacks the credibility of the witnesses presented by the Government. In this connection it stresses that some of these witnesses * * * were under charges of false swearing. Full opportunity for cross examination of these witnesses was afforded at the hearing before the Board, and full opportunity was also afforded for the presentation of rebuttal testimony. The evaluation of credibility is primarily a matter for the trier of the facts, and a reviewing court cannot disturb that evaluation unless a manifest error has been made. Moreover the testimony of the witnesses against whom charges are said to have been made was consistent with and supported by masses of other evidence. * * *' 96 U.S.App.D.C. 66, 100, 223 F.2d 531, 565.
10
The Court of Appeals affirmed the order of the Board. It sustained § 13(e) against the contention that its standards were vague and irrational. It held that the findings of the Board had been established by a preponderance of the evidence, except that it struck, as not being supported by a preponderance of the evidence, the finding that the secret practices were undertaken for the purpose of promoting the objectives, and concealing the true nature, of petitioner; and it also struck the finding in connection with reporting to a foreign government because the record supported only a finding of reporting by Party leaders 'upon occasion,' not a finding which implied a constant, systematic reporting. The court, however, found that the Board's conclusion was supported by the basic findings which it had affirmed. With respect to petitioner's other attacks on the constitutional validity of the statute, the court found it necessary to consider some of the so-called 'sanction' sections, §§ 5, 6, 10, 11, 22, and 25, as well as § 7, the registration section. It held that they were all constitutional and therefore affirmed the order of the Board.4
11
The challenge to the Act on which the order was based plainly raises constitutional questions appropriate for this Court's consideration, and so we brought the case here. 349 U.S. 943, 75 S.Ct. 872, 99 L.Ed. 1270. At the threshold we are, however, confronted by a particular claim that the Court of Appeals erred in refusing to return the case to the Board for consideration of the new evidence proffered by petitioner's motion and affidavit. This non-constitutional issue must be met at the outset, because the case must be decided on a non-constitutional issue, if the record calls for it, without reaching constitutional problems. Peters v. Hobby, 349 U.S. 331, 75 S.Ct. 790, 99 L.Ed. 1129.
12
In considering this non-constitutional issue raised by denial of petitioner's motion, we must avoid any intimation with respect to the other issues raised by petitioner. We do not so intimate by concluding that the testimony of the three witnesses, against whom the uncontested challenge of perjury was made, was not inconsequential in relation to the issues on which the Board had to pass. No doubt a large part of the record consisted of documentary evidence. However, not only was the human testimony significant but the documentary evidence was also linked to the activities of the petitioner and to the ultimate finding of the Board by human testimony, and such testimony was in part that of these three witnesses. The facts bearing on the issue are not in controversy. The direct testimony of witness Crouch occupied 387 pages of the typewritten transcript; that of Johnson, 163 pages; and that of Matusow, 118 pages. The annotated report of the Board, in which citations to the evidence were made to illustrate the support for its findings, contained 36 references to the testimony of Crouch, 25 references to the testimony of Johnson, and 24 references to the testimony of Matusow. These references were made in support of every finding under the eight criteria of § 13(e) and it is also not to be assumed that the evidence given by these three witnesses played no role in the Board's findings of fact even when not specifically cited.5 Testimony, for example, directed toward proving that the Communist Party of the United States was an agency utilized by a foreign government to undermine the loyalty of the armed forces, and to be in a position to paralyze shipping and prevent transportation of soldiers and war supplies through the Panama Canal, Hawaii, and the ports of San Francisco and New York in time of war, cannot be deemed insignificant in such a determination as that which the Board made in this proceeding.
13
This is a proceeding under an Act which Congress conceived necessary for 'the security of the United States and to the existence of free American institutions * * *.' 64 Stat., at 989, 50 U.S.C.A. § 781(15). The untainted administration of justice is certainly one of the most cherished aspects of our institutions. Its observance is one of our proudest boasts. This Court is charged with supervisory functions in relation to proceedings in the federal courts. See McNabb v. United States, 318 U.S. 332, 63 S.Ct. 608, 87 L.Ed. 819. Therefore, fastidious regard for the honor of the administration of justice requires the Court to make certain that the doing of justice be made so manifest that only irrational or perverse claims of its disregard can be asserted.
14
When uncontested challenge is made that a finding of subversive design by petitioner was in part the product of three perjurious witnesses, it does not remove the taint for a reviewing court to find that there is ample innocent testimony to support the Board's findings. If these witnesses in fact committed perjury in testifying in other cases on subject matter substantially like that of their testimony in the present proceedings, their testimony in this proceeding is inevitably discredited and the Board's determination must duly take this fact into account. We cannot pass upon a record containing such challenged testimony. We find it necessary to dispose of the case on the grounds we do, not in order to avoid a constitutional adjudication but because the fair administration of justice requires it. Since reversal is thus demanded, however, we do not reach the constitutional issues.
15
The basis for challenging the testimony was not in existence when the proceedings were concluded before the Board. Petitioner should therefore be given leave to make its allegations before the Board in a rroceeding under § 14(a) of the Act. The issue on which the case must be returned to the Board lies within a narrow compass and the Board has ample scope of discretion in passing upon petitioner's motion. The purpose of this remand, as is its reason, is to make certain that the Board bases its findings upon untainted evidence. To that end it may hold a hearing to ascertain the truth of petitioner's allegations, and if the testimony of the three witnesses is discredited, it must not leave that testimony part of the record. Alternatively, the Board may choose to assume the truth of petitioner's allegations and, without further hearing, expunge the testimony of these witnesses from the record. In either event, the Board must then reconsider its original determination in the light of the record as freed from the challenge that now beclouds it.
16
The case is reversed and remanded for proceedings in conformity with this opinion.
17
Reversed and remanded.
18
Mr. Justice CLARK, with whom Mr. Justice REED and Mr. Justice MINTON join, dissenting.
19
On November 22, 1950, the Attorney General petitioned the Subversive Activities Control Board for an order directing the Communist Party to register as a Communist-action organization, pursuant to the provisions of the Internal Security Act of 1950. On April 20, 1953, the Board unanimously directed the Communist Party to register, finding 'upon the overwhelming weight of the evidence * * * (the Communist Party) is substantially directed, dominated, and controlled by the Soviet Union * * * and * * * operates primarily to advance the objectives of such world Communist movement.'
20
Nearly two years later, while the matter was before the Court of Appeals, the Communist Party filed a motion for leave to adduce additional evidence under § 14(a) of the Internal Security Act. The 'new evidence' attacked the credibility of witnesses Crouch, Johnson, and Matusow, 3 of the 22 witnesses for the Government. The motion charged that Crouch and Johnson had perjured themselves in their testimony in such other cases as United States v. Kuzma, United States v. Bridges, In re Burck, and United States v. Weinberg. It also charged that Matusow had recanted his testimony in Communist cases and was writing a book entitled 'Blacklisting (or Blackmailing) Was My Business.'
21
The Board opposed the motion, stating that the testimony of the three witnesses could 'be ignored in toto and the ultimate determination * * * will remain amply supported by evidence both testimonial and documentary in character. * * * The (Communist Party) would still be found a Communist-action organization by overwhelming evidence.'
22
The Court of Appeals denied the motion without opinion. However, in its opinion on the merits, the court pointed out that similar attacks had been made on the credibility of these as well as other witnesses before the Board. For example, in 194 pages of cross-examination before the Board, the Party charged that witness Johnson had committed perjury in Pennsylvania v. Nelson, In re Yanish, In re Dmytryshyn, United States v. Eisler, and in testimony before the Un-American Activities Committee. The 112-page cross-examination of Matusow likewise was largely devoted to charges of perjury before various boards and committees. Crouch was cross-examined for 810 pages, practically all of which was devoted to an attack on his credibility through his testimony in other proceedings. As the Court of Appeals concluded (96 U.S.App.D.C. 66, 223 F.2d 565), 'Full opportunity for cross examination of these witnesses was afforded at the hearing before the Board, and full opportunity was also afforded for the presentation of rebuttal testimony. * * * Moreover the testimony of the witnesses against whom charges are said to have been made was consistent with and supported by masses of other evidence.' 96 U.S.App.D.C. 100, 223 F.2d 565. Not only did little of the cross-examination relate to the evidence offered on direct, but the Party introduced only three witnesses in rebuttal and none refuted any specific testimony of the witnesses now challenged. The Court of Appeals affirmed the issuance of the order by the Board.
23
The Communist Party brought the case here on April 13, 1955, by petition for certiorari. 349 U.S. 943, 75 S.Ct. 872. The relative unimportance of this motion in the eyes of the Party is shown by the fact that its 131-page petition devotes but 2 pages to a discussion of this point. The Party's brief devotes only 4 1/2 of its 270 pages to the motion. Still the Court now says the Court of Appeals 'erred' in its denial of the motion and remands the case directly to the Board for it to determine again the credibility of these three witnesses. It refuses to pass on the important questions relating to the constitutionality of the Internal Security Act of 1950, a bulwark of the congressional program to combat the menace of world Communism. Believing that the Court here disregards its plain responsibility and duty to decide these important constitutional questions, I cannot join in its action.
24
I have not found any case in the history of the Court where important constitutional issues have been avoided on such a pretext. Certainly Peters v. Hobby, 349 U.S. 331, 75 S.Ct. 790, 99 L.Ed. 1129, is no authority for this action, since that case could be and was finally disposed of without reaching the constitutional issues. Here the case will be finally decided only after our decision on the constitutional questions. The action today is taken merely for delay and can result only in the Board reaffirming the action. In fact it so advised the Court of Appeals and that court found that all of the testimony of the questionable witnesses was supported by 'masses of other evidence.'
25
The allegations of the motion itself are entirely inadequate in that they point to no particular testimony before the Board as being false. There is no offer to disprove any testimony given, and no fact at issue in the proceeding is controverted. As to Crouch and Johnson, the motion merely cites additional cases in which it is alleged that their testimony was conflicting. These allegations are purely cumulative of the witnesses' cross-examination before the Board. With regard to Matusow, the motion mentions only newspaper reports and a press release referring to the statements of certain persons that Matusow had told them that he had lied. Ignoring the obvious inadequacy of this allegation, we may take judicial notice of the two cases where Matusow submitted affidavits stating that he had lied during the trial, United States v. Jencks and United States v. Flynn. In the Jencks case, the trial judge concluded that Matusow had been paid by a Communist source to recant and that his original testimony was true. The motion based entirely on Matusow's recantation was denied. This was affirmed by the Court of Appeals, Jencks v. United States, 5 Cir., 226 F.2d 540, certiorari granted 350 U.S. 980, 76 S.Ct. 467. In the Flynn case, 130 F.Supp. 412, the trial judge denied a similar motion as to 11 of the 13 defendants. Two of the defendants in Flynn were granted a new trial only because Matusow had testified specifically to private conversations with these defendants which demonstrated their advocacy of the forcible overthrow of the Government. Matusow's general testimony against other defendants was not disturbed. These cases make it clear that, except for the special circumstances of two defendants in the Flynn case, the lower courts have not granted new trials in criminal proceedings despite the retraction by Matusow of specific sworn testimony given at the trials. See also United States v. Parker, 3 Cir., 103 F.2d 857.1 But these were criminal cases where proof of guilt must be beyond a reasonable doubt. Here, only a preponderance of the evidence is required.
26
Motions to adduce additional evidence under § 14(a) are similar to motions to adduce evidence under § 10(e) of the National Labor Relations Act, 29 U.S.C.A. § 160(e), and the scope of our review is the same. Such motions are addressed to the sound discretion of the Court of Appeals. In order to reverse we must find more than that the court below erred, because it 'must not only have been in error but must also have abused its judicial discretion.' National Labor Relations Board v. Indiana & Michigan Electric Co., 318 U.S. 9, 16, 63 S.Ct. 394, 399, 87 L.Ed. 579. In this case the motion itself was wholly inadequate and even if the testimony of all three challenged witnesses were omitted from the record the result could not have been different. There is no reasonable basis on which we could say that the Court of Appeals has abused its discretion.
27
I abhor the use of perjured testimony as much as anyone, but we must recognize that never before have mere allegations of perjury, so flimsily supported, been considered grounds for reopening a proceeding or granting a new trial.2 The Communist Party makes no claim that the Government knowingly used false testimony, and it is far too realistic to contend that the Board's action will be any different on remand. The only purpose of this procedural maneuver is to gain additional time before the order to register can become effective. This proceeding has dragged out for many years now, and the function of the Board remains suspended and the congressional purpose frustrated to a most critical time in world history.
28
Ironically enough, we are returning the case to a Board whose very existence is challenged on constitutional grounds. We are asking the Board to pass on the credibility of witnesses after we have refused to say whether it has the power to do so. The constitutional questions are fairly presented here for our decision. If all or any part of the Act is unconstitutional, it should be declared so on the record before us. If not, the Nation is entitled to effective operation of the statute deemed to be of vital importance to its well-being at the time it was passed by the Congress. I would decide the questions presented by this record.
1
A 'Communist-action' organization is defined in § 3 of the Act as:
'(a) any organization in the United States (other than a diplomatic representative or mission of a foreign government accredited as such by the Department of State) which (i) is substantially directed, dominated, or controlled by the foreign government or foreign organization controlling the world Communist movement referred to in section 2 of this title, and (ii) operates primarily to advance the objectives of such world Communist movement as referred to in section 2 of this title; and
'(b) any section, branch, fraction, or cell of any organization defined in subparagraph (a) of this paragraph which has not complied with the registration requirements of this title.' 64 Stat., at 989.
The Act also defines and regulates 'Communist-front' organizations, but these sections of the Act are not involved in the present proceeding.
2
'In determining whether any organization is a 'Communist-action organization', the Board shall take into consideration—
'(1) the extent to which its policies are formulated and carried out and its activities performed, pursuant to directives or to effectuate
the policies of the foreign government or foreign organization in which is vested, or under the domination or control of which is exercised, the direction and control of the world Communist movement referred to in section 2 of this title; and
'(2) the extent to which its views and policies do not deviate from those of such foreign government or foreign organization; and
'(3) the extent to which it receives financial or other aid, directly or indirectly, from or at the direction of such foreign government or foreign organization; and
'(4) the extent to which it sends members or representatives to any foreign country for instruction or training in the principles, policies, strategy, or tactics of such world Communist movement; and
'(5) the extent to which it reports to such foreign government or foreign organization or to its representatives; and
'(6) the extent to which its principal leaders or a substantial number of its members are subject to or recognize the disciplinary power of such foreign government or foreign organization or its representatives; and
'(7) the extent to which, for the purpose of concealing foreign direction, domination, or control, or of expediting or promoting its objectives, (i) it fails to disclose, or resists efforts to obtain information as to, its membership (by keeping membership lists in code, by instructing members to refuse to acknowledge membership, or by any other method); (ii) its members refuse to acknowledge membership therein; (iii) it fails to disclose, or resists efforts to obtain information as to, records other than membership lists; (iv) its meetings are secret; and (v) it otherwise operates on a secret basis; and
'(8) the extent to which its principal leaders or a substantial number of its members consider the allegiance they owe to the United States as subordinate to their obligations to such foreign government or foreign organization.' 64 Stat., at 999 1000, 50 U.S.C.A. § 792(e).
3
Section 14(a) of the Act provides:
'* * * If either party shall apply to the court for leave to adduce additional evidence, and shall show to the satisfaction of the court that such additional evidence is material, the court may order such additional evidence to be taken before the Board and to be adduced upon the proceeding in such manner and upon such terms and conditions as to the court may seem proper. The Board may modify its findings as to the facts, by reason of the additional evidence so taken, and it shall file such modified or new findings, which, if supported by the preponderance of the evidence shall be conclusive, and its recommendations, if any, with respect to action in the matter under consideration. * * *' 64 Stat., at 1001—1002, 50 U.S.C.A. § 793(a).
4
Judge Bazelon dissented on the ground that the registration provision violated the Fifth Amendment's privilege against self-incrimination because it compelled the person signing it to identify himself as a Communist Party functionary and because it compelled a listing of officers and members. 96 U.S.App.D.C. at page 111, 223 F.2d at page 576.
5
In this connection the following statement of the Board in its report should be noted:
'In making our findings herein, we have considered and weighed all the evidence of record. In weighing (the Attorney General's) evidence, we have considered that certain of (his) witnesses fall into the category of 'informers' and we have scrutinized their testimony accordingly; we have considered and resolved the inconsistencies in the testimony of certain of (the Attorney General's) witnesses; we have considered the testimony of (the Attorney General's) witnesses against the background of their various organizational positions and activities in the CPUSA which afforded the sources of their knowledge; and we have had the benefit of the Panel's observation of their demeanor while testifying. Viewing these considerations in the light of the whole record, we find no basis for disregarding the substance of their testimony.'
1
Despite the direct allegations of perjury in this case, this Court refused to review the denial of the motion for a new trial. 307 U.S. 642, 59 S.Ct. 1044, 83 L.Ed. 1522.
2
In at least three cases this Term we declined to review state criminal convictions in which must stronger allegations of perjury were made. See Reynolds v. State of Texas, 350 U.S. 863, 76 S.Ct. 102; Whitener v. State of South Carolina, 350 U.S. 861, 76 S.Ct. 101, and Coco v. State of Florida, 350 U.S. 828, 76 S.Ct. 57.
| 23
|
351 U.S. 91
76 S.Ct. 671
100 L.Ed. 964
UNITED STATES of America, Petitioner,v.Ettore ZUCCA, also known as Mario Sarni, also known as Ettore Sarni Zucca.
No. 213.
Argued Jan. 24, 25, 1956.
Decided April 30, 1956.
Mr.J. F. Bishop, Washington, D.C., for petitioner.
Mr. Orrin G. Judd, New York City, for respondent.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
This is a denaturalization proceeding under § 340(a) of the Immigration and Nationality Act of 1952.1 The sole question is whether § 340(a) makes the filing of the 'affidavit showing good cause' a prerequisite to maintenance of the suit. The District Court held that it does and ordered the complaint dismissed unless the Government filed an affidavit showing good cause within 60 days. As this was not done, the complaint was dismissed without prejudice to the Government's right to institute an action to denaturalize the respondent upon filing the affidavit. 125 F.Supp. 551. On appeal by the Government the Court of Appeals for the Second Circuit affirmed, adopting the opinion of the District Court. 221 F.2d 805. We granted certiorari, 350 U.S. 817, 76 S.Ct. 72, because of an asserted conflict with decisions of the Seventh2 and Ninth3 Circuits and because of the importance of the question in the administration of the immigration and naturalization laws.
2
Respondent Ettore Zucca was naturalized on January 4, 1944. In 1954, the United States Attorney for the Southern District of New York, proceeding under § 340(a), filed a verified complaint in the United States District Court in his District seeking revocation of respondent's naturalization on the grounds of illegality, concealment of material facts, and willful misrepresentation.
3
The complaint alleged that respondent, at his naturalization hearing and in his petition for naturalization, had falsely sworn 'that he did not belong to and was not associated with any organization which teaches or advocates the overthrow of existing government in this country * * *,' that it was his 'intention in good faith to become a citizen of the United States and to renounce absolutely and forever all allegiance and fidelity to any (foreign powers) * * *,' and that he was and had been 'attached to the principles of the Constitution of the United States and well disposed to the good order and happiness of the United States.' This was followed by a general allegation of membership in the Communist Party and 'other organizations affiliated with or controlled by the Communist Party of the United States from 1925 to 1947,' and equally general allegations that respondent procured his naturalization by concealment and willful misrepresentation in that he concealed the facts relating to his membership in the Communist Party and affiliated organizations and otherwise swore falsely as to his intentions and beliefs. The pleader concluded that 'good cause exists for the institution of this suit * * *.' The complaint, no part of which was alleged on information and belief, was verified by an Assistant United States Attorney. When respondent sought to take depositions of this Attorney, he was met with an affidavit in opposition denying personal knowledge.4 Respondent then filed his motion to dismiss on the ground, inter alia, that § 340(a) required the filing of an affidavit showing good cause and that this requirement had not been complied with. As stated above, the motion to dismiss was granted on this ground.
4
The Government argues that a reading of the statute and its legislative history leads to the conclusion that the filing of an 'affidavit showing good cause' is not a prerequisite to maintaining denaturalization proceedings under § 340(a). We do not agree.
5
The affidavit provision with which we are here concerned first appeared in § 15 of the Act of June 29, 1906.5 Without substantial change, it was carried forward in the laws of 19406 and 1952,7 currently reading as follows:
6
'Sec. 340. (a) It shall be the duty of the United States district attorneys for the respective districts, upon affidavit showing good cause therefor, to institute proceedings in any court specified in subsection (a) of section 310 of this title in the judicial district in which the naturalized citizen may reside at the time of bringing suit, for the purpose of revoking and setting aside the order admitting such person to citizenship and canceling the certificate of naturalization on the ground that such order and certificate of naturalization were procured by concealment of a material fact or by willful misrepresentation, * * *.' (Emphasis added.)
7
Were we obliged to rely solely on the wording of the statute, we would have no difficulty in reaching the conclusion that the filing of the affidavit is a prerequisite to maintaining a denaturalization suit. This conclusion is not altered by a consideration of the Government's highly speculative suggestions as to the meaning of the legislative history. On the contrary, we think that it is entirely consistent with the Court's statement in Bindczyck v. Finucane, 342 U.S. 76, 83, 72 S.Ct. 130, 134, 96 L.Ed. 100, that Congress acted '(w)ith a view to protecting the Government against fraud while safeguarding citizenship from abrogation except by a clearly defined procedure * * *.'
8
The natural meaning of the language used in § 340(a) is that filing of the affidavit is a procedural prerequisite to maintenance of the suit. In the Bindczyck case, this Court held that § 338(a) of the Nationality Act of 1940, predecessor of § 340(a), sets forth the exclusive procedure for denaturalization.8 Despite that decision, the Government would have us hold now that the grant of power to maintain denaturalization suits is found in the general duty of United States Attorneys to prosecute all civil actions in which the United States is concerned,9 and that § 340(a) merely imposes the 'additional duty * * * to act, not alone on their own knowledge and judgment, but on the basis of an affidavit of good cause furnished by private citizens.' In effect the Government argues that the affidavit is required only when the proceeding is to be brought on the complaint of a private citizen. We need not decide whether a private citizen may ever file such a complaint. The short answer in this case is that the Government laid its complaint expressly under § 340(a).
9
While arguing that the words of § 340 are words of limitation on the discretion of the United States Attorney, the Government apparently concedes that the venue and notice provisions of the Section are generally applicable to denaturalization proceedings. Its argument overlooks the fact that the affidavit and venue provisions are in the same sentence. If the affidavit were required only when the United States Attorney proceeded on the complaint of a private citizen, then only in such a case would the venue be restricted to the district of the defendant's residence. We could accept such a limiting construction of the statute only upon a very clear showing that Congress meant something other than what it said.
10
The original Act of 1906 was the culmination of many years of study by Congress and a commission of which the Attorney General was a leading spirit and his Assistant the Chairman. Shortly after its enactment, the same Attorney General rendered an opinion to the Secretary of Commerce and Labor to the effect that the filing of an affidavit was 'necessary to give a United States attorney authority to institute proceedings in any court for the cancellation of a naturalization certificate.'10 In such circumstances, a contemporaneous construction of a statute by the officer charged with its enforcement is entitled to great weight. Fawcus Machine Co. v. United States, 282 U.S. 375, 378, 51 S.Ct. 144, 145, 75 L.Ed. 397; Norwegian Nitrogen Products Co. v. United States, 288 U.S. 294, 315, 53 S.Ct. 350, 358, 77 L.Ed. 796. Over a period of years, however, there has been some conflict among the circuits concerning the affidavit requirement.11 The Government relies particularly on our affirmance of the decision of the Court of Appeals for the Ninth Circuit in Schwinn v. United States, 311 U.S. 616, 61 S.Ct. 70, 85 L.Ed. 390. The Court decided that case on the sole ground of illegal procurement. Although the necessity of the affidavit was considered below in view of the Government's failure to offer proof in support of its allegation that an affidavit of good cause had been furnished, the question was not presented to this Court.12
11
Prior to the decision in the Schwinn case the practice of the Justice Department seems generally to have been to institute denaturalization proceedings upon affidavit showing good cause. The Government does not now contend that it has abandoned that practice. It merely claims the right not to do so when it chooses, as clearly appears from portions of a Department of Justice memorandum which has been brought to the Court's attention.13 We are unimpressed by the reasoning of that memorandum. We think that the public interest is not served by taking such liberties with a specific statutory requirement designed for the protection of naturalized citizens. And we fail to see that the requirement imposes a burden on the Government. At this Term, it has been represented to us that the usual practice is that, 'if sufficient grounds are shown, an 'affidavit showing good cause' (see Section 340(a) of the Act * * is prepared and executed, and is forwarded as an aid to the formal judicial proceedings * * *.'14
12
Lastly the Government contends, as an alternate ground for reversal, that no harm is done to the defendant because the complaint itself is verified and, therefore, accomplishes the function of the affidavit. With this we cannot agree. The complaint, under modern practice, is required merely to allege ultimate facts while the affidavit must set forth evidentiary matters showing good cause for cancellation of citizenship.15
13
In the Bindczyck case, supra, the Court summed up the purpose of and approach to denaturalization proceedings as follows:
14
'(W)e cannot escape the conclusion that in its detailed provisions for revoking a naturalization because of fraud or illegal procurement not appearing on the face of the record, Congress formulated a self-contained, exclusive procedure. With a view to protecting the Government against fraud while safeguarding citizenship from abrogation except by a clearly defined procedure, Congress insisted on the detailed, explicit provisions of § 15.
15
'* * * if citizenship ws granted, it was to be proof against attacks for fraud or illegal procurement based on evidence outside the record, except through the proceedings prescribed in § 15. The congressional scheme, providing carefully for the representation of the Government's interest before the grant of citizenship and a detailed, safeguarded procedure for attacking the decree on evidence of fraud outside the record, covers the whole ground. Every national interest is thereby protected.' 342 U.S. at page 83, 84, 72 S.Ct. at page 134.
16
This proceeding was concededly brought under § 340(a). We hold that this is the only Section under which a United States attorney may institute denaturalization proceedings, and that the affidavit showing good cause is a procedural prerequisite to the maintenance of proceedings thereunder.
17
The mere filing of a proceeding for denaturalization results in serious consequences to a defendant. Even if his citizenship is not cancelled, his reputation is tarnished and his standing in the community damaged. Congress recognized this danger and provided that a person, once admitted to American citizenship, should not be subject to legal proceedings to defend his citizenship without a preliminary showing of good cause. Such a safeguard must not be lightly regarded. We believe that, not only in some cases but in all cases, the District Attorney must, as a prerequisite to the initiation of such proceedings, file an affidavit showing good cause. The District Court below correctly dismissed the proceedings in this case because of the failure of the Government to file the required affidavit and the judgment of the Court of Appeals is therefore affirmed.
18
Affirmed.
19
Mr. Justice HARLAN took no part in the consideration or decision of this case.
20
Mr. Justice CLARK, with whom Mr. Justice REED and Mr. Justice MINTON join, dissenting.
21
The Court's ruling today seriously obstructs the Government in filing denaturalization proceedings in this type of case. It reverses a long line of cases in the lower federal courts1 and disregards a consistent administrative practice of over thirty years standing, a period which includes two recodifications of the immigration laws. Furthermore, the identical point on which the case today is decided was present in two earlier cases where it apparently was not considered important enough to be presented to this Court.2
22
The only authority for the Court's action is an unpublished, informal, and somewhat ambiguous inter-departmental letter of the Attorney General written in 1907. While any Attorney General might well be proud to see his views given such lasting effect, he undoubtedly would be surprised to learn that the authority of such an informal statement could overrule later court decisions and a thirty-year, firmly established position of the Department of Justice. Many cases witness the fact that the Court has often given little or no weight to carefully drawn opinions of the Attorney General on questions of statutory interpretation.
23
But my major objection to the decision today is the extreme burden placed on the Government in cases such as this. The Court construes § 340(a) of the Immigration and Nationality Act to require something more than was filed in the present case. The complaint here was verified; the Assistant United States Attorney swore that the facts alleged in the complaint were 'true' and 'that the sources of his information * * * are the records which are on file in his office.' Thus the complaint in this case was supported by the jurat of a notary public and the sworn statement of an Assistant United States Attorney who held office by virtue of his oath to carry out his official duties fairly and impartially. No more was present in Schneiderman v. United States, 320 U.S. 118, 63 S.Ct. 1333, 87 L.Ed. 1796.
24
The complaint alleged that Zucca had lied in his alien registration statement in 1940, and in his preliminary naturalization examination and testimony before a naturalization examiner in 1952. He is alleged to have stated under oath that 'he did not belong to and was not associated with any organization which teaches or advocates the overthrow of existing government.' The complaint then alleges that Zucca 'was a member of the Communist Party of the United States, including the Workers Communist Party * * * from 1925 to 1947.' Under § 305 of the Nationality Act of 1940,* the complaint continues, Zucca's naturalization was illegal.
25
But the majority declares that these sworn allegations are insufficient. It makes a vague reference to the pleading of 'ultimate facts while the affidavit must set forth evidentiary matters showing good cause for cancellation of citizenship.' From this statement I can draw only one conclusion. As respondent contends, 'good cause' means 'that the Government must furnish the Court with sworn statements by persons having personal knowledge of the facts * * * Congress could not have intended that the courts be required to accept the second-hand statements of investigators * * *.'3 Apparently neither the United States Attorney nor anyone in the Immigration Service or the FBI can make such an affidavit unless he has personal knowledge of the facts. This would limit verification by these officers to cases based on prior undisclosed criminal convictions, arrival age where controlling, etc.
26
But in proceedings based solely on membership in the Communist Party substantially different conditions prevail. Invariably, membership can be proved only from the testimony of other members concerning attendance at meetings, payment of dues, etc. There are no membership cards in the Party and have been none for more than a decade. If these evidential methods of proof—the testimony and identity of undercover agents—must be disclosed in an affidavit, the Government must choose between foregoing denaturalization cases and drying up its source of information before the proceeding can be brought. It is common knowledge among law enforcement officers that witnesses are affidavit-shy, particularly in cases involving subversion. Often, testimony can be obtained only in court with the aid of compulsory process. The difficulties in requiring exposure by affidavit are overwhelming and decisive in cases of this type.
27
I do not believe Congress ever intended such a rule. To me § 340(a) is clear and unambiguous. Its plain reading is that proceedings may be filed by the United States Attorney 'upon affidavit showing good cause therefor.' Here the Attorney swore to specific charges which certainly do constitute 'good cause.' The sworn statement that petitioner was a member of the Communist Party and the Workers Communist Party from 1925 to 1947 alleges a prima facie case. To me it seems obvious that the purpose of § 340(a)—to reduce the possibility of spurious denaturalization proceedings—is fully served by such a sworn statement.
28
Nor did the Congress intend that there should be two trials of issues of fact in these cases. To require the filing of evidential affidavits implies, as Zucca contends, extensive testing of their sufficiency before trial. The defendant is thus given two chances at the Government's case. There is no comparable requirement for an indictment in a criminal prosecution, Costello v. United States, 350 U.S. 359, 76 S.Ct. 406. But denaturalization is only a civil proceeding to withdraw a privilege wrongfully obtained. There has always been the requirement of proof under cross-examination of charges against the naturalized citizen, but apparently in this case the Court authorizes an additional procedure. Before his trial in this denaturalization proceeding, Zucca may file a bill of particulars and take depositions of each witness signing a 'good cause' affidavit. The scope and reliability of the affidavits are then made the subject of judicial inquiry.4 If the Government proves its case at this stage, it may then go to trial, where the same evidence is considered again. To my way of thinking, this clearly frustrates an important congressional program, a part of the broader one designed to protect our country from Communist infiltration.
29
In my opinion § 340(a) requires the United States Attorney to allege in a sworn complaint sufficient factual information to show a prima facie case for denaturalization. At most it should be sufficient for an officer of the Immigration and Naturalization Service familiar with the case to make such allegations under oath. If the Court would require this paper to be headed 'Affidavit' and contained in a separate blue backing, I would have no objection, though I see nothing to be gained from such a technical labeling. But as I read the Court's decision today it goes much further than this, and it may well submerge the denaturalization procedure established by Congress in a morass of unintended procedural difficulties.
1
66 Stat. 163, 260, as amended, 68 Stat. 1232, 8 U.S.C. (Supp. II) § 1451(a), 8 U.S.C.A. § 1451(a).
2
United States v. Tuteur, 7 Cir., 215 F.2d 415.
3
Schwinn v. United States, 9 Cir., 112 F.2d 74, affirmed per curiam, 311 U.S. 616, 61 S.Ct. 70, 85 L.Ed. 390.
4
The affidavit read as follows:
'George C. Mantzoros, being duly sworn, deposes and says as follows:
'That he is one of the Assistant United States Attorneys on the staff of J. Edward Lumbard, United States Attorney for the Southern District of New York in charge of the above-entitled case.
'That the only knowledge or information which he has in this case has been obtained through files turned over to him for use in preparation of the complaint.
'That he has no personal knowledge of any of the facts herein and is not a prospective witness.
'That on information and belief his superior, the said J. Edward Lumbard likewise has no personal knowledge of any of the facts herein and is not a prospective witness.
'That he has carefully reviewed the files in this case and finds nothing therein which would indicate any special or unusual circumstances requiring the production of the documents requested by the defendant in his notice to take depositions, dated July 8, 1954.
'That many of the documents in said files are privileged because of their confidential nature.' R. 8.
5
34 Stat. 596, 601.
6
Section 338(a) of the Nationality Act of 1940, 54 Stat. 1137, 1158.
7
66 Stat. 163, 260, as amended, 68 Stat. 1232, 8 U.S.C. (Supp. II) § 1451(a), 8 U.S.C.A. § 1451(a).
8
The specific holding, that § 338(a) of the 1940 Act overrode local rules concerning time limitations upon the power of state courts to reopen their judgments, was abrogated by § 340(j) of the Immigration and Nationality Act of 1952, 66 Stat. 163, 262. The underlying philosophy of Bindczyck remains intact.
9
28 U.S.C. § 507(a)(2), 28 U.S.C.A. § 507(a)(2).
10
Letter of Attorney General Bonaparte, March 26, 1907 (unpublished, National Archives), cited in a contemporary treatise by a recognized authority on the statute. Van Dyne, Law of Naturalization (1907), 138. The letter is reproduced at p. 50 of the Brief for the United States.
11
The Courts of Appeals for the Third, Fifth, and District of Columbia Circuits had taken the position adopted by the Second Circuit in this case. United States v. Richmond, 3 Cir., 17 F.2d 28; United States v. Salomon, 5 Cir., 231 F. 928; Cohen v. United States, 38 App.D.C. 123. The Seventh and Ninth Circuits favored the contrary position. United States v. Tuteur, 7 Cir., 215 F.2d 415; Schwinn v. United States, 9 Cir., 112 F.2d 74, affirmed per curiam, 311 U.S. 616, 61 S.Ct. 70, 85 L.Ed. 390; United States v. Knight, D.C.Mont., 291 F. 129, affirmed 9 Cir., 299 F. 571; United States v. Leles, D.C., 227 F. 189.
12
On two prior occasions this Court has had occasion to notice the affidavit provision without suggesting that it was not an essential procedural step in the denaturalization proceeding. See Johannessen v. United States, 225 U.S. 227, 242, 32 S.Ct. 613, 617, 56 L.Ed. 1066; Schneiderman v. United States, 320 U.S. 118, 159, note 54, 63 S.Ct. 1333, 1353, 87 L.Ed. 1796.
13
'As indicated below in 'IV. Pre-Trial Procedure,' the defendant can probably obtain most of the government's evidence by a proper utilization of the methods of discovery provided in Rules 16, 33, and 34 (Fed.Rules Civ.Proc. 28 U.S.C.A.). It, therefore, may be advisable at the outset to furnish him with a reasonable amount of the government's evidence in order to reduce the chance of these discovery rules being employed, and thus avoid the ensuing delay. If this is done, it would seem that the affidavit rather than the complaint is the proper place in which to recite evidence.
'In the event it is decided in a given case to furnish the defendant with some of the government's evidence, it is recommended that an affidavit be prepared and served with the complaint and that in the affidavit there be recited briefly the nature of the evidence to be relied upon. This recitation of evidence should be of a general nature but sufficient to reduce the ordinary chance of the discovery rules being employed and at the same time to reduce the likelihood of the government having to oppose a motion for a bill of particulars. On the other hand, it should not be so complete as to provide the defendant with the names of witnesses and possibly can be so phrased as not to disclose their identity. Similarly, it may be disadvantageous to make it so complete as to identify specific instruments or writings, for this may increase the likelihood of a demand for their production under Rule 34. It would seem sufficient to set out the general substance or type of statements or writings known to have been made without quoting them. It would also seem proper to aver generally membership and leadership in the German-American Bund or other un-American organizations, refusal of military service, general propaganda activities, etc.
'If it is believed undesirable to attach an affidavit to the complaint and to serve it upon the defendant, as discussed above, in that instance no reference should be made in the complaint to an affidavit having been prepared and as constituting the basis of the action.' Circular No. 3663, Dept. of Justice, Supp. No. 9, April 6, 1943 (mimeographed), p. 87, printed in a supplemental memorandum filed by the Government in this case.
14
Brief for the United States, United States v. Minker, 350 U.S. 179, 76 S.Ct. 281 (No. 35, October Term, 1955), at p. 34.
15
United States v. Richmond, 3 Cir., 17 F.2d 28; United States v. Salomon, 5 Cir., 231 F. 928.
1
Schwinn v. United States, 9 Cir., 112 F.2d 74, affirmed 311 U.S. 616, 61 S.Ct. 70, 85 L.Ed. 390; United States v. Tuteur, 7 Cir., 215 F.2d 415; United States v. Knight, D.C.Mont., 291 F. 129, affirmed 9 Cir., 299 F. 571; United States v. Collins, D.C.S.D.N.Y., 131 F.Supp. 545; United States v. Shinkevich, D.C.E.D.Pa., 131 F.Supp. 547; United States v. Jerome, D.C.S.D.N.Y., 115 F.Supp. 818; United States v. Lustig, D.C.S.D.N.Y., 110 F.Supp. 806; United States v. Schuchhardt, D.C.N.D.Ind., 48 F.Supp. 876; United States v. Leles, D.C.N.D.Cal., 227 F. 189, 236 F. 784; United States v. Radzie, D.C.S.D.N.Y., 14 F.R.D. 151; United States v. Vavorito, D.C.N.D.Ohio, 7 F.R.D. 152.
2
In Schwinn v. United States, 112 F.2d 74, the Ninth Circuit held that the filing of the affidavit was not 'jurisdictional,' and passed on the merits. We granted certiorari and affirmed summarily 'on the sole ground' that the certificate had been illegally procured. 311 U.S. 616, 61 S.Ct. 70, 85 L.Ed. 390. In Schneiderman v. United States, 320 U.S. 118, 63 S.Ct 1333, 87 L.Ed. 1796, we considered the merits at length, even though the 'affidavit' filed in that case by the Immigration Inspector revealed that his information was based, as here, solely on the Government's files, and was in exactly the form used here.
3
The trial judge held 'that before a United States Attorney may institute a denaturalization proceeding he must be furnished with an affidavit of good cause.'
*
1952 Revision, 8 U.S.C.A. § 1424.
4
The trial judge held, 'But, the protection afforded by the requirement of an affidavit of good cause would be seriously impaired if the defendant in a denaturalization action could not examine it and test its sufficiency by motion before trial.'
| 12
|
351 U.S. 105
76 S.Ct. 679
100 L.Ed. 975
NATIONAL LABOR RELATIONS BOARD, Petitioner,v.The BABCOCK AND WILCOX COMPANY. NATIONAL LABOR RELATIONS BOARD, Petitioner, v. SEAMPRUFE, Inc. RANCO, Inc. v. NATIONAL LABOR RELATIONS BOARD.
Nos. 250, 251, 422.
Argued Jan. 25 and 26, 1956.
Decided April 30, 1956.
Mr.Dominick L. Manoli, Washington, D.C., for N.L.R.B.
Mr. O. B. Fisher, Paris, Tex., for respondent Babcock & Wilcox Co.
Mr. Karl H. Mueller, Fort Worth, Tex., for respondent Seamprufe, Inc.
Mr. Eugene B. Schwartz, Cleveland, Ohio, for petitioner Ranco, Inc.
Mr. Justice REED delivered the opinion of the Court.
1
In each of these cases the employer refused to permit distribution of union literature by nonemployee union organizers on company-owned parking lots. The National Labor Relations Board, in separate and unrelated proceedings, found in each case that it was unreasonably difficult for the union organizer to reach the employees off company property and held that, in refusing the unions access to parking lots, the employers had unreasonably impeded their employees' right to self-organization in violation of § 8(a)(1) of the National Labor Relations Act, 29 U.S.C.A. § 158(a)(1). Babcock & Wilcox Co., 109 N.L.R.B. 485, 494; Ranco, Inc., id., 998, 1007, and Seamprufe, Inc., id., 24, 32.
2
The plant involved in No. 250, National Labor Relations Board v. Babcock & Wilcox Co., is a company engaged in the manufacture of tubular products such as boilers and accessories, located on a 100-acre tract about one mile from a community of 21,000 people. Approximately 40% of the 500 employees live in that town and the remainder live within a 30-mile radius. More than 90% of them drive to work in private automobiles and park on a company lot that adjoins the fenced in plant area. The parking lot is reached only by a driveway 100 yards long which is entirely on company property excepting for a public right-of-way that extends 31 feet from the metal of the highway to the plant's property. Thus, the only public place in the immediate vicinity of the plant area at which leaflets can be effectively distributed to employees is that place where this driveway crosses the public right-of-way. Because of the traffic conditions at that place the Board found it practically impossible for union organizers to distribute leaflets safely to employees in motors as they enter or leave the lot. The Board noted that the company's policy on such distribution had not discriminated against labor organizations and that other means of communication, such as the mail and telephones, as well as the homes of the workers, were open to the union.1 The employer justified its refusal to allow distribution of literature on company property on the ground that it had maintained a consistent policy of refusing access to all kinds of pamphleteering and that such distribution of leaflets would litter its property.
3
The Board found that the parking lot and the walkway from it to the gatehouse, where employees punched in for work, were the only 'safe and practicable' places for distribution of union literature. The Board viewed the place of work as so much more effective a place for communication of information that it held the employer guilty of an unfair labor practice for refusing limited access to company property to union organizers. It therefore ordered the employer to rescind its no-distibution order for the parking lot and walkway, subject to reasonable and nondiscriminating regulations 'in the interest of plant efficiency and discipline, but not as to deny access to union representatives for the purpose of effecting such distribution.' 109 N.L.R.B., at 486.
4
The Board petitioned the Court of Appeals for the Fifth Circuit for enforcement. That court refused enforcement on the ground the statute did not authorize the Board to impose a servitude on the employer's property where no employee was involved. National Labor Relations Board v. Babcock & Wilcox Co., 5 Cir., 222 F.2d 316.
5
The conditions and circumstances involved in No. 251, National Labor Relations Board v. Seamprufe, Inc., and No. 422, Ranco, Inc., v. National Labor Relations Board, are not materially different, except that Seamprufe involves a plant employing approximately 200 persons and in the Ranco case it appears that union organizers had a better opportunity to pass out literature off company property. The Board likewise ordered these employers to allow union organizers limited access to company lots. The orders were in substantially similar form as that in the Babcock & Wilcox case. Enforcement of the orders was sought in the Courts of Appeals. The Court of Appeals for the Tenth Circuit in No. 251, National Labor Relations Board v. Seamprufe, Inc., 222 F.2d 858, 861, refused enforcement on the ground that a nonemployee can justify his presence on company property only 'as it bears a cogent relationship to the exercise of the employees' guaranteed right of self organization.' These 'solicitors were therefore strangers to the right of self-organization, absent a showing of nonaccessibility amounting to a handicap to self-organization.' Id., 222 F.2d at page 861. The Court of Appeals for the Sixth Circuit in No. 422 granted enforcement. National Labor Relations Board v. Ranco, Inc., 222 F.2d 543. The per curiam opinion depended upon its decision in National Labor Relations Board v. Monarch Tool Co., 6 Cir., 210 F.2d 183, a case in which only employees were involved; National Labor Relations Board v. Lake Superior Lumber Corp., 6 Cir., 167 F.2d 147, an isolated lumber camp case; and our Republic Aviation Corp. v. National Labor Relations Board, 324 U.S. 793, 65 S.Ct. 982, 89 L.Ed. 1372. It apparently considered, as held in the Monarch Tool case, supra, 210 F.2d at page 186, that the attitude of the employer in the Ranco case was an 'unreasonable impediment to the freedom of communication essential to the exercise of its employees' rights to self organization.' Because of the conflicting decisions on a recurring phase of enforcement of the National Labor Relations Act, we granted certiorari. 350 U.S. 818, 894, 76 S.Ct. 78, 156.
6
In each of these cases the Board found that the employer violated § 8(a)(1) of the National Labor Relations Act, 61 Stat. 140, making it an unfair labor practice for an employer to interfere with employees in the exercise of rights guaranteed in § 7 of that Act. The pertinent language of the two sections appears below.2 These holdings were placed on the Labor Board's determination in LeTourneau Company of Georgia, 54 N.L.R.B. 1253. In the LeTourneau case the Board balanced the conflicting interests of employees to receive information on self-organization on the company's property from fellow employees during nonworking time, with the employer's right to control the use of his property and found the former more essential in the circumstances of that case.3 Recognizing that the employer could restrict employees' union activities when necessary to maintain plant discipline or production, the Board said: 'Upon all the above considerations, we are convinced, and find, that the respondent, in applying its 'no-distributing' rule to the distribution of union literature by its employees on its parking lots has placed an unreasonable impediment on the freedom of communication essential to the exercise of its employees' right to self-organization,' LeTourneau Company of Georgia, 54 N.L.R.B. at page 1262. This Court affirmed the Board. Republic Aviation Corp. v. National Labor Relations Board, 324 U.S. 793, 801 et seq., 65 S.Ct. 982, 987, 89 L.Ed. 1372. The same rule had been earlier and more fully stated in Peyton Packing Co., 49 N.L.R.B. 828, 843—844.
7
The Board has applied its reasoning in the LeTourneau case without distinction to situations were the distribution was made, as here, by nonemployees. Carolina Mills, 92 N.L.R.B. 1141, 1149, 1168—1169.4 The fact that our LeTourneau case ruled only as to employees has been noted by the Courts of Appeal in National Labor Relations Board v. Lake Superior Lumber Corp., 6 Cir., 167 F.2d 147, 150, and National Labor Relations Board v. Seamprufe, Inc., 10 Cir., 222 F.2d at page 860. Cf. National Labor Relations Board v. American Furnace Co., 7 Cir., 158 F.2d 376, 380.
8
It these present cases the Board has set out the facts that support its conclusions as to the necessity for allowing nonemployee union organizers to distribute union literature on the company's property. In essence they are that nonemployee union representatives, if barred, would have to use personal contacts on streets or at home, telephones, letters or advertised meetings to get in touch with the employees. The force of this position in respect to employees isolated from normal contacts has been recognized by this Court and by others. See Republic Aviation Corporation v. National Labor Relations Board, supra, 324 U.S. at page 799, note 3, 65 S.Ct. at page 986, 89 L.Ed. 1372; National Labor Relations Board v. Lake Superior Lumber Corp., supra, 167 F.2d at page 150. We recognize, too, that the Board has the responsibility of "applying the Act's general prohibitory language in the light of the infinite combinations of events which might be charged as violative of its terms." National Labor Relations Board v. Stowe Spinning Co., 336 U.S. 226, 231, 69 S.Ct. 541, 543. We are slow to overturn an administrative decision.
9
It is our judgment, however, that an employer may validly post his property against nonemployee distribution of union literature if reasonable efforts by the union through other available channels of communication will enable it to reach the employees with its message and if the employer's notice or order does not discriminate against the union by allowing other distribution. In these circumstances the employer may not be compelled to allow distribution even under such reasonable regulations as the orders in these cases permit.
10
This is not a problem of always open or always closed doors for union organization on company property. Organization rights are granted to workers by the same authority, the National Government, that preserves property rights. Accommodation between the two must be obtained with as little destruction of one as is consistent with the maintenance of the other. The employer may not affirmatively interfere with organization; the union may not always insist that the employer aid organization. But when the inaccessibility of employees makes ineffective the reasonable attempts by nonemployees to communicate with them through the usual channels, the right to exclude from property has been required to yield to the extent needed to permit communication of information on the right to organize.
11
The determination of the proper adjustments rests with the Board. Its rulings, when reached on findings of fact supported by substantial evidence on the record as a whole,5 should be sustained by the courts unless its conclusions rest on erroneous legal foundations. Here the Board failed to make a distinction between rules of law applicable to employees and those applicable to nonemployees.6
12
The distinction is one of substance. No restriction may be placed on the employees' right to discuss self-organization among themselves, unless the employer can demonstrate that a restriction is necessary to maintain production or discipline. Republic Aviation Corp. v. National Labor Relations Board, 324 U.S. 793, 803, 65 S.Ct. 982, 988, 89 L.Ed. 1372. But no such obligation is owed nonemployee organizers. Their access to company property is governed by a different consideration. The right of self-organization depends in some measure on the ability of employees to learn the advantages of self- organization from others. Consequently, if the location of a plant and the living quarters of the employees place the employees beyond the reach of reasonable union efforts to communicate with them, the employer must allow the union to approach his employees on his property. No such conditions are shown in these records.
13
The plants are close to small well-settled communities where a large percentage of the employees live. The usual methods of imparting information are available. See, e.g., note 1, supra. The various instruments of publicity are at hand. Though the quarters of the employees are scattered they are in reasonable reach. The Act requires only that the employer refrain from interference, discrimination, restrant or coercion in the employees' exercise of their own rights. It does not require that the employer permit the use of its facilities for organization when other means are readily available.
14
Labor Board v. Babcock & Wilcox Co., No. 250, is affirmed.
15
Affirmed.
16
Labor Board v. Seamprufe, Inc., No. 251, is affirmed.
17
Affirmed.
18
Ranco, Inc. v. Labor Board, No. 422, is reversed.
19
Reversed.
20
Mr. Justice HARLAN took no part in the consideration or decision of these cases.
1
'Other union contacts with employees: In addition to distributing literature to some of the employees, as shown above, during the period of concern herein the Union has had other contacts with some of the employees. It has communicated with over 100 employees of Respondent on 3 different occasions by sending literature to them through the mails. Union representatives have communicated with many of Respondent's employees by talking with them on the streets of Paris, by driving to their homes and talking with them there, and by talking with them over the telephone. All of these contacts have been for the purpose of soliciting the adherence and membership of the employees in the Union. 109 N.L.R.B., at 492—493.
2
'Sec. 7. Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection * * *.
'Sec. 8(a). It shall be an unfair labor practice for an employer—
'(1) to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 7 * * *.' 61 Stat. 140, 29 U.S.C. §§ 157, 158(a) (1), 29 U.S.C.A. §§ 157, 158(a)(1).
3
'As previously indicated, the respondent's plant is located in the country in the heart of 6,000 acres of land owned by it or its subsidiary. Apart from U.S. Highway No. 13 (and perhaps the intersecting road), the respondent and its subsidiary own all the land adjacent to the plant. This, in itself, seriously limits the possibilities of effectively communicating with the bulk of the respondent's employees. This limitation would not, however, be too restrictive if the respondent's gate opened directly onto the highway, for then persons could stand outside the respondent's premises and distribute literature as each employee entered or left the plant. But at the respondent's plant the gate is 100 feet back from the highway, on company property. Over 60 per cent of the respondent's employees, after passing the gate, enter automobiles or busses parked in the space between the gate and the highway, and presumably speed homeward, without ever setting foot on the highway. Distribution of literature to employees is rendered virtually impossible under these circumstances, and it is an inescapable conclusion that self-organization is consequently seriously impeded. It is no answer to suggest that other means of disseminating union literature are not foreclosed. Moreover, the employees' homes are scattered over a wide area. In the absence of a list of names and addresses, it appears that direct contact with the majority of the respondent's employees away from the plant would be extremely difficult.' LeTourneau Company of Georgia, 54 N.L.R.B., at 1260 1261.
4
An element of discrimination existed in the Carolina Mills case, 92 N.L.R.B., at 1142, such as existed in National Labor Relations Board v. Stowe Spinning Co., 336 U.S. 226, 230, 233, 69 S.Ct. 541, 543, 544, 93 L.Ed. 638, but this was not relied upon in the opinion. See also Caldwell Furniture Co., 97 N.L.R.B. 1501, 1502, 1509; Monarch Machine Tool Co., 102 N.L.R.B. 1242, 1248, enforced, National Labor Relations Board v. Monarch Tool Co., 6 Cir., 210 F.2d 183. For a collection of Board cases, see Ranco, Inc., 109 N.L.R.B. 998, 1006, and Note, 65 Yale L.J. 423.
5
Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 491, 71 S.Ct. 456, 466, 95 L.Ed. 456.
6
In the Seamprufe case the examiner's report, approved by the Board, said: 'To differentiate between employees soliciting on behalf of the Union and nonemployee union solicitors would be a differentiation not only without substance but in clear defiance of the rationale given by the Board and the courts for permitting solicitation. This conclusion is based on the belief that the rationale enunciated by the Supreme Court in the LeTourneau case, supra, is equally applicable in the case of solicitation by union representatives as well as where the solicitation is done by employees.' 109 N.L.R.B., at 32. See also Babcock & Wilcox Co., id., at 493, and Ranco, Inc., id., at 1006.
| 67
|
351 U.S. 159
76 S.Ct. 728
100 L.Ed. 1055
GENERAL BOX COMPANY, Petitioner,v.UNITED STATES of America.
No. 383.
Argued March 28, 1956.
Decided May 7, 1956.
Rehearing Denied June 11, 1956.
See 351 U.S. 990, 76 S.Ct. 1044.
Messrs.
Edward D. Moseley, Baton Rouge, La., Ross R. Barnett, Jackson, Miss., for petitioner.
Mr. S. Billingsley Hill, Washington, D.C., for respondent.
Mr. Justice REED delivered the opinion of the Court.
1
General Box Company, an owner of trees of commercial value along the main stem of the Mississippi River in Louisiana, brought this action to recover from the United States the value of its timber destroyed by the Government through its duly authorized agent, a contractor.
2
The trees grew upon land belonging to others and located between the low- and high-water mark of the river. Such land is known in Louisiana as 'batture.'1 Since colonial days batture has been subject to a servitude of the State for use in the construction and maintenance of levees. It may be used for these purposes without the payment of compensation to the owner.2 The United States cooperates with Louisiana in the containment of the Mississippi within levees.3 To carry out federal plans in the area in controversy, the United States requires,4 and Louisiana agrees to furnish,5 the necessary rights-of-way 'without cost' for the construction of levees. Louisiana has given general authority to its Levee Boards to donate to the United States the necessary 'lands, movable or immovable property, rights of way, or servitudes' for flood control use.6 The Fifth Louisiana Levee District, the one here involved, agreed to meet the requirements of the Federal Flood Control Act.7
3
The location of the operation giving rise to this action was at the Brabston Levee in the Fifth Louisiana Levee District. The first step taken by the United States to obtain the permission of the State to use the State's servitude in the batture here in issue was the filing of the federal plans with the State District Engineer. The plans were approved by the Engineer and the local Levee Board was so notified.8 On June 10, 1947, the Levee Board received the drawings from the United States District Engineer with the following request for authority:
4
'It is desired that this District be furnished a formal statement by your Board that rights-of-way are available for the construction of the enlargement and granting the United States a right of entry to prosecute the work. This statement may be in the form of a letter signed by the President of the Board.' Under a standing resolution, adopted September 12, 1945, the President of the Board was empowered to honor applications for such authority.9 On June 12, 1947, the Board President responded to the United States Engineer, quoting the words of the request and adding:
5
'The Board of Commissioners of the Fifth Louisiana Levee District hereby is glad to comply with your request and render you any assistance possible.'
6
On July 9 that letter was spread upon the minutes of the Board. We accept that, as did the Court of Appeals, as a ratification by the Board of the act of its President. On July 10 the contractors who were to execute the levee work were authorized by the United States to proceed within 20 days, and the clearing of the batture was commenced on July 22.
7
No notice was given to petitioner of the intention to bulldoze its trees off the batture. On September 12 the petitioner discovered that the trees were being destroyed, and an objection was promptly made. The contractor, however, refused to halt its operations, relying upon its contract with the Government.
8
Petitioner brought two actions in the District Court under the Tucker Act, 28 U.S.C. § 1346(a)(2), 28 U.S.C.A. § 1346(a)(2), to recover the value of the destroyed timber.10 The suits were consolidated for trial, and ultimately a single judgment was entered against the United States in the amount of $10,801 plus interest.11 Both the United States and petitioner took appeals to the Court of Appeals, the former on the merits and the latter from so much of the judgment as fixed the interest at 4% from date of judgment. The Court of Appeals reversed, holding the United States to be free from liability.12 We granted certiorari to examine the liability of the United States for proceeding to clear this land without notice to petitioner, the owner of the trees, and thus without granting petitioner a reasonable opportunity to salvage the timber.13
9
One of the defenses relied upon by the United States throughout this litigation is a claim that it is not liable to petitioner for the timber losses because it received rights-of-way on the land involved from the Levee Board, and that the Levee Board legally appropriated those rights-of-way without compensation under its riparian servitude. Petitioner concedes that under the civil law of Louisiana the property on which its trees were standing, being batture, is subject to a riparian servitude for use by the State of Louisiana in constructing and repairing levees, and that historically the owner of such property has been required to permit State use without compensation of such part thereof as might be needed for levee purposes. And it is not denied that the timber on this land, as well as the land itself, is subject to the exercise of the servitude for levee purposes.14
10
Petitioner in effect does claim, however, that the State did not effectively exercise the riparian servitude for the reason that the appropriation here was arbitrary and therefore beyond the power of the State. This contention is based upon the fact that no notice of the proposed destruction was given to petitioner. It is argued that under Louisiana law, which of course defines the bounds of the riparian servitude, the power possessed by the State by reason of the servitude is not an unlimited and arbitrary power;15 that it would be arbitrary, oppressive and unjust to exercise the State's rights under the servictude in the circumstances of this case without prior notice to petitioner; that therefore the attempt by the State to exercise the servitude without such notice was ineffective to cause an appropriation of the timber pursuant to the servitude. If Louisiana could not exercise its rights under the servitude without first giving notice to petitioner, the timber here involved was never successfully taken by the State free of an obligation to compensate for the taking.16 It would follow that the United States received no rights from the Levee Board permitting destruction of the trees by it free of that obligation. The Court of Appeals held, based upon its analysis of Louisiana law, that prior notice to petitioner was not a prerequisite to an appropriation of its timber for levee purposes. We ordinarily accept the determinations of the Courts of Appeals on questions of local law, and we do so here. Ragan v. Merchants Transfer & Warehouse Co., 337 U.S. 530, 534, 69 S.Ct. 1233, 1235, 93 L.Ed. 1520; Huddleston v. Dwyer, 322 U.S. 232, 237, 64 S.Ct. 1015, 1018, 88 L.Ed. 1246.
11
The Louisiana courts have made no pronouncement which directly controls this question. But see Board of Com'rs of Red River, Atchafalaya and Bayou Boeuf Levee Dist. v. Trouille, 212 La. 152, 31 So.2d 700. The Supreme Court of Louisiana has, however, as recently as 1946, reviewed the long history of the riparian servitude. Dickson v. Board of Com'rs, 210 La. 121, 26 So.2d 474. In that case it was noted that:
12
'* * * while in all of the remaining states of the Union lands necessary for levee purposes can only be used after expropriation and proper indemnification, in Louisiana the state has the right to act first, i.e., the authority to appropriate such land to a use to which it is subject under its very title, and talk later. * * *
13
'And however unfair it may seem to the owners of this type of land they are without right to complain because their acquisition of such land was subject by law to this ancient servitude and the private mischief must be endured rather than the public inconvenience or calamity.' 210 La. at pages 132, 136, 26 So.2d at pages 478, 479.
14
The court further stated that the rights of the State under the servitude can be exercised in the way found to be 'most expeditious from an engineering, economical, and practical standpoint.' 210 La. at pages 127, 138, 26 So.2d at page 480; Board of Com'rs of Tensas Basin Levee Dist. v. Franklin, 219 La. 859, 866, 54 So.2d 125, 127—128. The levee enlargement plan here called for bulldozing standing timber for reasons of economy—that operation admittedly being a less expensive method for clearing land than removing the stumps of cut timber. The servitude was developed so as to insure 'that the shores of navigable rivers and streams in this state would always be kept free for the public for levee * * * purposes.' 210 La. at pages 131—132, i6 So.2d at page 478. This historical background makes clear that the rights of the State in property subject to the servitude are very broad. By law, and for the good of all, lands were made available to the State for levee purposes in as convenient a manner to the State as was necessary for the public welfare, and with little regard for the severity of the obligations imposed on the individual property owner. Nothing in the development of the servitude indicates that, before the State can exercise its obviously comprehensive rights, it must provide an opportunity to remove timber from batture.
15
Since, as we hold, petitioner's property was effectively appropriated by state authorities pursuant to the servitude, the United States cannot be liable to petitioner for the value of the property. The State, as owner of the servitude, legally could have destroyed the timber without prior notice and without any opportunity for mitigation of losses, and yet be free of liability to petitioner. The destruction, it seems to us, was consistent with the rights of the State under the servitude. Rather than undertake the levee project itself, Louisiana, through one of its agencies, donated its rights as against petitioner's timber to the United States. The United States, as donee of those rights, could exercise them to their full extent without incurring liability, just as its donor could have done.
16
The petitioner sought compensation for the destruction of the trees based upon a claim that the 'destruction of said timber was (a) taking * * * within the meaning of the Fifth Amendment to the Federal Constitution.' But this property was not taken by the United States in the exercise of its power of eminent domain. In effect, the timber was 'owned' by Louisiana for levee purposes, and the United States succeeded to that 'ownership' by 'conveyance.' Louisiana furnished its batture as required by the law of both the United States and Louisiana for use in protecting the property in the State from floods. Petitioner did not assert in its complaints or in its question presented on petition for certiorari that the destruction violated the Due Process Clause of the Fifth Amendment.17
17
Affirmed.
18
Mr. Justice FRANKFURTER, concurring.
19
The conflicting views between two members and the rest of this Court on the law of Louisiana relevant to the issue in this case prove once more what a precarious business it is for us to adjudicate a federal issue dependent on what the Court finds to be state law, when the highest court of a State has not given us authoritative guidance regarding its law. In like situations I have, from time to time, suggested that legal procedure is not without resources for enabling us to found our decision securely on state law. See, e.g., Propper v. Clark, 337 U.S. 472, 493, 69 S.Ct. 1333, 1345, 93 L.Ed. 1480 (dissenting in part). By means of the declaratory judgment (it is available in Louisiana, LSA—Rev.Stat. 13:4231 et seq.) or otherwise, it ought to be possible to suspend definitive judgment on the federal issue until a pronouncement can be had from the state court on controlling state law. For myself I am prepared so to proceed here. In default of it, I concur in the opinion and judgment of the Court.
20
Mr. Justice DOUGLAS, with whom Mr. Justice HARLAN concurs, dissenting.
21
We have at the root of this case a question of Louisiana law whether the timber grown on batture is 'property' and, if so, whether it may be confiscated without any opportunity to the owner to salvage or remove it. The timber concededly is of value. It is bought and sold and plays a significant role in the conduct of commercial enterprises.1 The Court apparently concedes that the timber is 'property' within the meaning of the Fifth Amendment. Otherwise the Court would not reserve decision on whether the Due Process Clause of the Fifth Amendment has been violated. If the timber is 'property' so far as the Due Process Clause is concerned, it would seem to be 'property' within the meaning of the Just Compensation Clause of the same Amendment. The question then comes down to whether the timber may be confiscated without any notice to the owner. If Louisiana could not confiscate the timber, then the United States certainly may not. For the United States has succeeded to such ownership as Louisiana has.
22
Concededly this land between low- and high-water mark—the batture—may be used as the State chooses for the construction and maintenance of levees without compensation to anyone. But we have it on excellent authority that, under Louisiana law, private property on the batture may not be confiscated without reasonable opportunity of the owner to salvage it. The authority is the eminent district judge who decided this case, Hon. Ben C. Dawkins. Judge Dawkins, who was appointed to the federal bench in 1924, was a Louisiana lawyer of distinction. He not only practiced law in that State. From 1912—1918 he was a state district judge and from 1918—1924 an associate justice of Louisiana's Supreme Court. He was a member of the Louisiana Constitutional Convention in 1921. Indeed, Judge Dawkins was the author of Art. XVI, § 6 of the Louisiana Constitution, which provides that batture may be taken for levee purposes without compensation. See General Box Co. v. United States, D.C., 107 F.Supp. 981, 983. Judge Dawkins held that, under Louisiana law, notice to the owner of the timber was necessary. There is no square holding of the Louisiana courts on the point. The problem lies in the penumbra of Louisiana law, making all the more difficult a prediction as to what the Louisiana courts would hold. On questions far less complicated or obscure than this one, we have deferred to decisions of the lower federal judge on the local law of his own State. See MacGregor v. State Mutual Life Assur. Co., 315 U.S. 280, 281, 62 S.Ct. 607, 86 L.Ed. 846; Huddleston v. Dwyer, 322 U.S. 232, 237, 64 S.Ct. 1015, 1018, 88 L.Ed. 1246; Hillsborough Tp., Somerset County, N.J. v. Cromwell, 326 U.S. 620, 630, 66 S.Ct. 445, 451, 90 L.Ed. 358; Steele v. General Mills, 329 U.S. 433, 439, 67 S.Ct. 439, 442, 91 L.Ed. 402; Ragan v. Merchants Transfer & Warehouse Co., 337 U.S. 530, 534, 69 S.Ct. 1233, 1235, 93 L.Ed. 1520; Bernhardt v. Polygraphic Co., 350 U.S. 198, 204, 76 S.Ct. 273, 276.
23
Judge Dawkins relied on Pruyn v. Nelson Bros., 180 La. 760, 768, 157 So. 585, 587, where the Louisiana Supreme Court in reviewing the servitude governing batture said:
24
'This servitude is limited only by the reasonableness of its use, and the administrative officers of the state of Louisiana are charged with determining that limit, subject to review by the courts only when oppression or injustice is shown and proved.'
25
Judge Dawkins ruled that what was done in this case amounted to 'oppression or injustice' within the meaning of the Pruyn case. See 119 F.Supp. 749, 751. I would defer to his judgment. We are dealing with nuances of local law that only one trained in it can evaluate.2 The difficulty is compounded for common-law lawyers. For this is civil law that has overtones from distinct languages and history.
26
Mr. Justice Holmes wrote, in a case from Puerto Rico, of the special deference due local judges on rulings upon matters under the civil law. Diaz v. Gonzalez, 261 U.S. 102, 105—106, 43 S.Ct. 286, 287, 67 L.Ed. 550:
27
'This is especially true in dealing with the decisions of a Court inheriting and brought up in a different system from that which prevails here. When we contemplate such a system from the outside it seems like a wall of stone, every part even with all the others, except so far as our own local education may lead us to see subordinations to which we are accustomed. But to one brought up within it, varying emphasis, tacit assumptions, unwritten practices, a thousand influences gained only from life, may give to the different parts wholly new values that logic and grammar never could have gotten from the books.'
28
I cannot read the Louisiana decisions without feeling that Judge Dawkins was right on the law.3 The servitude governing batture is dominant but not absolute. Private property must give way before it—but only to extent that the public welfare demands. As stated in Peart v. Meeker, 45 La.Ann. 421, 426, 12 So. 490, 492:
29
'It is undoubtedly the duty of the public officers charged by the state with the execution of its police power, to make no greater sacrifice of private rights than the public welfare demands. In several cases this court has said that the power so conferred is not arbitrary, and that the citizen is not without remedy to subject it to judicial control in proper cases.' If the State destroyed a home or other structure in the batture without notice to the owner, I think Louisiana would grant a remedy—provided of course the State was not confronted with an emergency and did not have to act with speed. But, where there is time to give notice, it is 'oppressive' not to do so, as Judge Dawkins said.
30
Even if I am mistaken in this view of the Louisiana law, I would hold as a matter of federal law that the United States cannot rely on the state-created servitude to justify its own action, which borders on the wanton destruction of the property interests of the private owners of the timber. For all that appears, General Box was prepared to remove the timber without additional expense or delay to the United States.
31
The requirement of notice is deeply engrained in our system of jurisprudence. Mullane v. Central Hanover Bank, 339 U.S. 306, 70 S.Ct. 652, 94 L.Ed. 865; Covey v. Town of Somers, 351 U.S. 141, 76 S.Ct. 724. The taking of property without notice where notice can reasonably be given, and with the result that the owner is deprived of the chance to salvage the property, is sheer confiscation.
1
Batture is 'that part of the river bed which is uncovered at the time of low water, but is covered annually at the time of ordinary high water.' (Italics omitted). Boyce Cottonseed Oil Mfg. Co. v. Board of Com'rs, 160 La. 727, 734, 107 So. 506, 508.
2
See Wolfe v. Hurley, D.C., 46 F.2d 515, affirmed 283 U.S. 801, 51 S.Ct. 493, 75 L.Ed. 1423; Dickson v. Board of Com'rs, 210 La. 121, 26 So.2d 474; Pruyn v. Nelson Bros., 180 La. 760, 157 So. 585; Mayer v. Board of Com'rs, 177 La. 1119, 150 So. 295; Peart v. Meeker, 45 La.Ann. 421, 12 So. 490; LSA—Civil Code, Art. 665; La.Const.1921, Art. XVI, § 6—LSA.
3
Federal Flood Control Act of May 15, 1928, 45 Stat. 534, as amended, 33 U.S.C. § 702a et seq., 33 U.S.C.A. § 702a et seq.
4
33 U.S.C. § 702c, 33 U.S.C.A. § 702c.
5
La.Const.1921, Art. XVI, § 5. And see note 6, infra.
6
Act No. 75, Acts of 1940, LSA—Rev.Stat. 52:2. And see Act No. 76, Acts of 1938, La.Gen.Stat.1939, § 6869.3.
7
The Board of Commissioners of the Fifth Louisiana Levee District adopted general resolutions in 1928 and 1929, in consideration of the benefits of the Flood Control Act, agreeing to '(p)rovide without cost to the United States all rights of way for levee foundations and levees on the main stem of the Mississippi River.'
8
On May 19, 1947, the State District Engineer wrote to the President of the Levee Board as follows:
'We are in receipt of a letter from Colonel John R. Hardin, District Engineer, New Orleans District, U.S. Engineers, dated May 9 together with project plans of the proposed enlargement of the Brabston and Ashland Levees south of Vidalia, Louisiana.
'We have examined these plans and it is recommended that your Board concur with Colonel Hardin in enlarging these two low sections of levee in accordance with plans, provided that provisions are made for draining existing gravel road on crown of old levee.'
9
'Due to the fact that in emergency levee work delays are at times caused by the necessity of waiting for rights-of-ways until the next regular Board meeting, Commissioner Yerger offered the motion, seconded by Commissioner Guenard, and unanimously approved, that the President of the Board, Mr. A. T. Shields, be and he is hereby authorized and empowered on behalf of the Board of Commissioners, Fifth Louisiana Levee District, to grant rights of way where the need is immediate, the proper right-of-way resolutions to be passed in the regular manner at the following Board meeting.'
10
Although alternative claims were made under the Federal Tort Claims Act, 28 U.S.C. § 1346(b), 28 U.S.C.A. § 1346(b), they were abandoned while the cases were still in the District Court. See 107 F.Supp. 981.
11
119 F.Supp. 749. See also prior opinions of the District Court in this case at 94 F.Supp. 441 and 107 F.Supp. 981.
12
224 F.2d 7.
13
350 U.S. 882, 76 S.Ct. 139.
The Board of Commissioners of the Fifth Levee District was made a third party defendant in the District Court pursuant to a motion of the United States. It was and is the Government's position that, if it is liable to petitioner, it is entitled to judgment over against the Board. The District Court ruled that the United States was liable and that it, and not the Levee Board, must pay the award. 119 F.Supp. 749. The Court of Appeals did not reach the question of the liability of the Board over to the United States since that court held that the United States was not liable at all. In view of our disposition of the case, we likewise need not reach that question.
14
Cf. Lacour v. Red River, A. & B.B. Levee Dist., 158 La. 737, 104 So. 636; La.Const.1921, Art. XVI, § 6; Louisiana Statutes Annotated—Civil Code, Art. 665.
Petitioner suggests that the destruction of the timber in this case was not for 'levee purposes,' but rather was undertaken merely for the purpose of saving the Government money. This contention is based on the fact that the only reason the trees were destroyed was because the contractors were permitted under their contract to bulldoze the standing trees—a less expensive method for clearing land than removing the stumps of cut timber. But in order for the use of the timber to be for 'levee purposes,' it is not necessary that the trees themselves be employed in the construction or improvement of the levee. It is sufficient if the trees were destroyed in connection v. Red River, A. & B.B. Levee Dist., v. Red River, A. & B.B. Levee Dist., supra; La.Const.1921, Art. XVI, § 6.
15
Petitioner relies on language in Peart v. Meeker, 45 La.Ann. 421, 426, 12 So. 490, 492; and in Pruyn v. Nelson Bros., 180 La. 760, 768, 157 So. 585, 587.
16
La.Const.1921, Art. I, § 2.
17
Cf. Eldridge v. Trezevant, 160 U.S. 452, 16 S.Ct. 345, 40 L.Ed. 490; Mayor and Board of Aldermen of Town of Vidalia v McNeely, 274 U.S. 676, 47 S.Ct 758, 71 L.Ed. 1292; Wolfe v. Hurley, D.C., 46 F.2d 515, affirmed 283 U.S. 801, 51 S.Ct. 493, 75 L.Ed. 1423; Board of Com'rs of Tensas Basin Levee Dist. v. Franklin, 219 La. 859, 54 So.2d 125, appeal dismissed 342 U.S. 844, 72 S.Ct. 80, 96 L.Ed. 638, on authority of Eldridge v. Trezevant, supra, and Wolfe v. Hurley, supra.
1
The timber which was destroyed was on two tracts of land. In 1946 petitioner purchased the entire fee of one tract for $30,000 and resold it for $15,000 two months later, reserving the timber rights for 20 years. In 1947 petitioner purchased the timber rights on the second tract for a period of 10 years, paying $36,000 for these rights. The trial judge found that the total value of the timber destroyed was $10,801, and he entered a judgment for that amount plus interest.
2
None of the judges either of the Circuit Court or of this Court who voted to reverse Judge Dawkins is from the Louisiana Bar.
3
No Louisiana cases have been found in which notice was not given in time to allow property to be salvaged from the batture. In Board of Levee Commissioners of Orleans Levee Dist. v. Kelly, 225 La. 411, 73 So.2d 299, 30 days notice was given to batture dwellers to remove their structures and possessions. And see Board of Commissioners of Tensas Basin Levee Dist. v. Franklin, 219 La. 859, 863—864, 54 So.2d 125, 127—128; Board of Commissioners of Red River Atchafalaya and Bayou Boeuf Levee Dist. v. Trouille, 212 La. 152, 157—158, 31 So.2d 700, 701—702; Peart v. Meeker, 45 La.Ann. 421, 424, 12 So. 490, 491, in each of which notice was given.
In the present case, written notice was sent to the owners after the clearning in question was completed. In this notice, the owners were warned that work would begin on another levee. The letter-notice said, 'We respectfully request that any buildings, timber or other obstacles which might be within the rights-of-way be removed prior to the time that the contractor begins work.'
The Court quotes from Dickson v. Board of Com'rs, 210 La. 121, 26 So.2d 474, to the effect that the State may 'appropriate such land * * * and talk later.' But the Dickson case involved consequential damages to riparian land resulting from a change in a river channel, not a taking of land or other property.
| 78
|
351 U.S. 149
76 S.Ct. 753
100 L.Ed. 1027
NATIONAL LABOR RELATIONS BOARD, Petitioner,v.TRUITT MANUFACTURING CO.
No. 486.
Argued March 29, 1956.
Decided May 7, 1956.
Mr.
David P. Findling, Washington, D.C., for petitioner.
Mr. R. D. Douglas, Jr., Greensboro, N.C., for respondent.
Mr. Justice BLACK delivered the opinion of the Court.
1
The National Labor Relations Act makes it an unfair labor practice for an employer to refuse to bargain in good faith with the representative of his employees.1 The question presented by this case is whether the National Labor Relations Board may find that an employer has not bargained in good faith where the employer claims it cannot afford to pay higher wages but refuses requests to produce information substantiating its claim.
2
The dispute here arose when a union representing certain of respondent's employees asked for a wage increase of 10 cents per hour. The company answered that it could not afford to pay such an increase, it was undercapitalized, had never paid dividends, and that an increase of more than 2 1/2 cents per hour would put it out of business. The union asked the company to produce some evidence substantiating these statements, requesting permission to have a certified public accountant examine the company's books, financial data, etc. This request being denied, the union asked that the company submit 'full and complete information with respect to its financial standing and profits,' insisting that such information was pertinent and essential for the employees to determine whether or not they should continue to press their demand for a wage increase. A union official testified before the trial examiner that '(W)e were wanting anything relating to the Company's position, any records or what have you, books, accounting sheets, cost expenditures, what not, anything to back the Company's position that they were unable to give any more money.' The company refused all the requests, relying solely on the statement that 'the information * * * is not pertinent to this discussion and the company declines to give you such information; You have no legal right to such.'
3
On the basis of these facts the National Labor Relations Board found that the company had 'failed to bargain in good faith with respect to wages in violation of Section 8(a)(5) of the Act.' 110 N.L.R.B. 856. The Board ordered the company to supply the union with such information as would 'substantiate the Respondent's position of its economic inability to pay the requested wage increase.' The Court of Appeals refused to enforce the Board's order, agreeing with respondent that it could not be held guilty of an unfair labor practice because of its refusal to furnish the information requested by the union. 4 Cir., 224 F.2d 869. In National Labor Relations Board v. Jacobs Mfg. Co., 196 F.2d 680, the Second Circuit upheld a Board finding of bad-faith bargaining based on an employer's refusal to supply financial information under circumstances similar to those here. Because of the conflict and the importance of the question we granted certiorari. 350 U.S. 922, 76 S.Ct. 211.
4
The company raised no objection to the Board's order on the ground that the scope of information required was too broad or that disclosure would put an undue burden on the company. Its major argument throughout has been that the information requested was irrelevant to the bargaining process and related to matters exclusively within the province of management. Thus we lay to one side the suggestion by the company here that the Board's order might be unduly burdensome or injurious to its business. In any event, the Board has heretofore taken the position in cases such as this that 'It is sufficient if the information is made available in a manner not so burdensome or timeconsuming as to impede the process of bargaining.'2 And in this case the Board has held substantiation of the company's position requires no more than 'reasonable proof.'
5
We think that in determining whether the obligation of good-faith bargaining has been met the Board has a right to consider an employer's refusal to give information about its financial status. While Congress did not compel agreement between employers and bargaining representatives, it did require collective bargaining in the hope that agreements would result. Section 204(a) (1) of the Act admonishes both employers and employees to 'exert every reasonable effort to make and maintain agreements concerning rates of pay, hours, and working conditions * * *.'3 In their effort to reach an agreement here both the union and the company treated the company's ability to pay increased wages as highly relevant. The ability of an employer to increase wages without injury to his business is a commonly considered factor in wage negotiations.4 Claims for increased wages have sometimes been abandoned because of an employer's unsatisfactory business condition; employees have even voted to accept wage decreases because of such conditions.5
6
Good-faith bargaining necessarily requires that claims made by either bargainer should be honest claims. This is true about an asserted inability to pay an increase in wages. If such an argument is important enough to present in the give and take of bargaining, it is important enough to require some sort of proof of its accuracy. And it would certainly not be farfetched for a trier of fact to reach the conclusion that bargaining lacks good faith when an employer mechanically repeats a claim of inability to pay without making the slightest effort to substantiate the claim. Such has been the holding of the Labor Board since shortly after the passage of the Wagner Act. In Pioneer Pearl Button Co., decided in 1936, where the employer's representative relied on the company's asserted 'poof financial condition,' the Board said: 'He did no more than take refuge in the assertion that the respondent's financial condition was poor; he refused either to prove his statement, or to permit independent verification. This is not collective bargaining. 1 N.L.R.B. 837, 842—843. This was the position of the Board when the Taft-Hartley Act was passed in 1947 and has been its position ever since.6 We agree with the Board that a refusal to attempt to substantiate a claim of inability to pay increased wages may support a finding of a failure to bargain in good faith.
7
The Board concluded that under the facts and circumstances of this case the respondent was guilty of an unfair labor practice in failing to bargain in good faith. We see no reason to disturb the findings of the Board. We do not hold, however, that in every case in which economic inability is raised as an argument against increased wages it automatically follows that the employees are entitled to substantiating evidence. Each case must turn upon its particular facts.7 The inquiry must always be whether or not under the circumstances of the particular case the statutory obligation to bargain in good faith has been met. Since we conclude that there is support in the record for the conclusion of the Board here that respondent did not bargain in good faith, it was error for the Court of Appeals to set aside the Board's order and deny enforcement.
8
Reversed.
9
Mr. Justice FRANKFURTER, whom Mr. Justice CLARK and Mr. Justice HARLAN join, concurring in part and dissenting in part.
10
This case involves the nature of the duty to bargain which the National Labor Relations Act imposes upon employers and unions. Section 8(a)(5) of the Act makes it 'an unfair labor practice for an employer * * * to refuse to bargain collectively with the representatives of his employees,' and § 8(b)(3) places a like duty upon the union vis-a -vis the employer. Section 8(d) provides that 'to bargain collectively is the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment, or the negotiation of an agreement, or any question arising thereunder, and the execution of a written contract incorporating any agreement reached if requested by either party, but such obligation does not compel either party to agree to a proposal or require the making of a concession * * *.' 61 Stat. 142, 29 U.S.C. § 158(d), 29 U.S.C.A. § 158(d).
11
These sections obligate the parties to make an honest effort to come to terms; they are required to try to reach an agreement in good faith. 'Good faith' means more than merely going through the motions of negotiating; it is inconsistent with a predetermined resolve not to budge from an initial position. But it is not necessarily incompatible with stubbornness or even with what to an outsider may seem unreasonableness. A determination of good faith or of want of good faith normally can rest only on an inference based upon more or less persuasive manifestations of another's state of mind. The previous relations of the parties, antecedent events explaining behavior at the bargaining table, and the course of negotiations constitute the raw facts for reaching such a determination. The appropriate inferences to be drawn from what is often confused and tangled testimony about all this makes a finding of absence of good faith one for the judgment of the Labor Board, unless the record as a whole leaves such judgment without reasonable foundation. See Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456.
12
An examination of the Board's opinion and the position taken by its counsel here disclose that the Board did not so conceive the issue of goof-faith bargaining in this case. The totality of the conduct of the negotiation was apparently deemed irrelevant to the question; one fact alone disposed of the case. '(I)t is settled law (the Board concluded), that when an employer seeks to justify the refusal of a wage increase upon an economic basis, as did the Respondent herein, good-faith bargaining under the Act requires that upon request the employer attempt to substantiate its economic position by reasonable proof.' 110 N.L.R.B. 856.
13
This is to make a rule of law out of one item—even if a weighty item—of the evidence. There is no warrant for this. The Board found authority in National Labor Relations Board v. Jacobs Mfg. Co., 2 Cir., 196 F.2d 680. That case presented a very different situation. The Jacobs Company had engaged in a course of conduct which the Board held to be a violation of § 8(a)(5). The Court of Appeals agreed that in light of the whole record the Board was entitled to find that the employer had not bargained in good faith. Its refusal to open its 'books and sales records' for union perusal was only part of the recalcitrant conduct and only one consideration in establishing want of good faith.1 The unfair labor practice was not founded on this refusal, and the court's principal concern about the disclosure of financial information was whether the Board's order should be enforced in this respect. The court sustained the Board's requirement for disclosure which 'will be met if the respondent produces whatever relevant information it has to indicate whether it can or cannot afford to comply with the Union's demands.' 196 F.2d 680, 684. This is a very far cry indeed from a ruling of law that failure to open a company's books establishes lack of good faith. Once good faith is found wanting, the scope of relief to be given by the Board is largely a question of administrative discretion. Neither Jacobs nor any other court of appeals' decision which has been called to our attention supports the rule of law which the Board has fashioned out of one thread drawn from the whole fabric of the evidence in this case.
14
The Labor Board itself has not always approached 'good faith' and the disclosure question in such a mechanical fashion. In Southern Saddlery Co., 90 N.L.R.B. 1205, the Board also found that § 8(a)(5) had been violated. But how differently the Board there considered its function.
15
'Bargaining in good faith is a duty on both sides to enter into discussions with an open and fair mind and a sincere purpose to find a basis for agreement touching wages and hours and conditions of labor. In applying this definition of good faith bargaining to any situation, the Board examines the Respondent's conduct as a whole for a clear indication as to whether the latter has refused to bargain in good faith, and the Board usually does not rely upon any one factor as conclusive evidence that the Respondent did not genuinely try to reach an agreement.' 90 N.L.R.B. 1205, 1206.
16
The Board found other factors in the Southern Saddlery case. The employer had made no counter-proposals or efforts to 'compromise the controversy.' Compare, McLean-Arkansas Lumber Co., Inc., 109 N.L.R.B. 1022. Such specific evidence is not indispensable, for a study of all the evidence in a record may disclose a mood indicative of a determination not to bargain. That is for the Board to decide. It is a process of inference-drawing, however, very different from the ultra vires law-making of the Board in this case.
17
Since the Board applied the wrong standard here, by ruling that Truitt's failure to supply financial information to the union constituted per se a refusal to bargain in good faith, the case should be returned to the Board. There is substantial evidence in the record which indicates that Truitt tried to reach an agreement. It offered a 2 1/2-cent wage increase, it expressed willingness to discuss with the union 'at any time the problem of how our wages compare with those of our competition,' and it continued throughout to meet and discuss the controversy with the union.
18
Because the record is not conclusive as a matter of law, one way or the other, I cannot join in the Court's disposition of the case. To reverse the Court of Appeals without remanding the case to the Board for further proceedings, implies that the Board would have reached the same conclusion in applying the right rule of law that it did in applying a wrong one. I cannot make such a forecast. I would return the case to the Board so that it may apply the relevant standard for determining 'good faith.'
1
'Sec. 8. (a) It shall be an unfair labor practice for an employer—
'(5) to refuse to bargain collectively with the representatives of his employees, subject to the provisions of section 9(a).
'(d) For the purposes of this section, to bargain collectively is the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment, or the negotiation of an agreement, or any question arising thereunder, and the execution of a written contract incorporating any agreement reached if requested by either party, but such obligation does not compel either party to agree to a proposal or require the making of a concession * * *.' 49 Stat. 452—453, as amended, 61 Stat. 140—142, 29 U.S.C. §§ 158(a)(5), 158(d), 29 U.S.C.A. § 158(a)(5), (d).
2
Old Line Life Ins. Co., 96 N.L.R.B. 499, 503; Cincinnati Steel Castings Co., 86 N.L.R.B. 592, 593.
3
61 Stat. 154, 29 U.S.C. § 174(a)(1), 29 U.S.C.A. § 174(a)(1).
4
See Sherman, Employer's Obligation to Produce Data for Collective Bargaining, 35 Minn.L.Rev. 24; Dunlop, The Economics of Wage-Dispute Settlement, 12 Law & Contemp. Prob. 281, 290; What Kind of Information Do Labor Unions Want in Financial Statements?, 87 J. Accountancy 368; How Collective Bargaining Works (Twentieth Century Fund, 1942) 453.
5
Daily Labor Report No. 156: A4—A5 (Bureau of National Affairs, Aug. 12, 1954); 35 Lab.Rel.Rep. 106; Union Votes Wage Freeze to Aid Rice-Stix, St. Louis Globe-Democrat, Nov. 25, 1954, p. 1, col. 4; Studebaker Men Vote for Pay Cuts, N.Y. Times, Aug. 13, 1954, p. 1, col. 5.
6
See, e.g., Southern Saddlery Co., 90 N.L.R.B 1205, 1206 1207; McLean-Arkansas Lumber Co., 109 N.L.R.B. 1022, 1035—1038; Jacobs Manufacturing Co., 94 N.L.R.B. 1214, 1221—1222, enforced, 196 F.2d 680; and cases therein cited.
7
See National Labor Relations Board v. American Nat. Ins. Co., 343 U.S. 395, 409—410, 72 S.Ct. 824, 832, 96 L.Ed. 1027.
1
'The respondent contends that it was under no statutory duty to confer with the union after the second meeting since all of the issues had been fully explored and the position of both parties expressed. Whether this was true, however, was a question of fact which the Board found adversely to the respondent. Since at both the meetings the respondent took the position that discussion of wage increases would be futile because it was financially unable to make them, and since it refused to discuss the other subjects at all, the Board was justified in concluding that the respondent had refused to bargain in good faith as the Act requires. Collective bargaining in compliance with the statute requires more than virtual insistence upon a prejudgment that no agreement could be reached by means of a discussion.' National Labor Relations Board v. Jacobs Mfg. Co., 2 Cir., 196 F.2d 680, at page 683.
| 67
|
351 U.S. 173
76 S.Ct. 745
100 L.Ed. 1065
Bill HATAHLEY et al., Petitioners,v.UNITED STATES of America.
No. 231.
Argued March 26—27, 1956.
Decided May 7, 1956.
Mr.Norman M. Littell, Washington, D.C., for petitioners.
Mr. Roger P. Marquis, Washington, D.C., for respondent.
Mr. Justice CLARK delivered the opinion of the Court.
1
Petitioners, either families of Navajo Indians, seek damages under the Federal Tort Claims Act, 28 U.S.C.A. §§ 1346(b), 2671 et seq., for the destruction of their horses by agents of the Federal Government. The District Court allowed damages of $100,000 and enjoined the Government and its agents from further interference with petitioners. The Court of Appeals for the Tenth Circuit reversed, 220 F.2d 666, on the ground that the Utah abandoned horse statute, Utah Code Ann., 1653, 47—2, was properly invoked by the government agents. We do not agree with the Court of Appeals.
2
Petitioners are wards of the Government. They have lived from time immemorial in stone and timber hogans on public land in San Juan County, Utah. This bleak area in the southeastern corner of the State is directly north of the Navajo Indian Reservation. While some Indian families from the reservation come into the area to graze their livestock, petitioners claim to have always lived there the year round. They are herdsmen and for generations they have grazed their livestock on this land. They are a simple and primitive people. Their living is derived entirely from their animals, from the little corn they are able to grow in family plots, and the wild game and pine nuts that the land itself affords. The District Court found that horses, as petitioners' beasts of burden and only means of transportation, were essential to their existence.1
3
In 1934 the Government enacted the Taylor Grazing Act, 48 Stat. 1269, 43 U.S.C. § 315, 43 U.S.C.A. § 315, which provided for the regulation and use of these public lands. Grazing permits were issued to white livestock operators, and for a number of years these permittees grazed their livestock in common with petitioners, who continued in peaceable occupation and use of the land they claimed as their ancestral home. Limited forage made disputes between the stockmen and the Indians inevitable, and about 1950 both the Government and the white livestock operators filed suits to remove the Indians from this land.2 In addition to legal proceedings, another method was employed by the government agents. Beginning in September 1952 and continuing until sometime after the present suit was filed in the District Court, the Department of Interior's range manager vigorously prosecuted a campaign to round up and destroy petitioners' horses. This action was taken pursuant to the Utah abandoned horse statute, Utah Code Ann., 1953, 47—2, which provides that the Board of County Commissioners may authorize the elimination of 'abandoned' horses on the open range. An 'abandoned' horse is defined as one running at large on the open range which is either not branded or, if branded, one on which the tax for the preceding year has not been paid. During the roundup a total of 115 horses and 38 burros belonging to petitioners were taken and sold or destroyed. Some horses were sold locally. Some were shot and their carcasses left on the range. Most of the animals, however, were trucked some 350 miles away to Provo, Utah, where they were sold to a horse-meat plant or a glue factory. The total amount derived from such sales, about $1,700, has been retained by the District Advisory Board composed of local stockmen. No part of it has been paid or offered to petitioners.
4
There is considerable evidence in the record to show that the Utah abandoned horse statute was applied discriminatorily against the Indians. In one instance the assistant range manager watched from a bluff while petitioner Hosteen Sakezzie released his horses from their corral. Later, a short distance away, the same government agent supervised a roundup of these horses and drove them 35 miles through the night to another corral from which they were loaded into trucks for the horse-meat plant. Sakezzie and three other Indians trailed the horses to the entrucking point but were not allowed to reclaim them. On another occasion five horses taken during the roundup which belonged to white stockmen were returned to their owners on the payment of a nominal $2.50 a head, but petitioner Little Wagon was told that to reclaim his horses the charge would be $60 a head, an amount known to be far above his means. For the most part, these and other facts found by the District Court were unchallenged in the Court of Appeals and are unchallenged here.3
5
The Court of Appeals did not reach the question of liability under the Federal Tort Claims Act, since it concluded that the government agents' actions were authorized by the Utah abandoned horse statute. We cannot dispose of this case so easily.
6
The Taylor Grazing Act seeks to provide the most beneficial use of the public range and to protect grazing rights in the districts it creates. Chournos v. United States, 10 Cir., 193 F.2d 321. Section 2 of the Act, 48 Stat. 1270, 43 U.S.C. § 315a, provides that the Secretary of the Interior shall 'make such rules and regulations * * * and do any and all things necessary to accomplish the purposes of this Act.' Pursuant to this authorization the Secretary has issued the Federal Range Code, 43 CFR § 161.1 et seq. Unauthorized grazing on the federal range and the removal of trespassing livestock is expressly provided for by § 161.11(b) of this Code:
7
'(b) Unlawful grazing on Federal range; removal of livestock; impoundment. Whenever the charge consists of unlawfully grazing livestock on the Federal range, the notice served on the alleged violator * * * will order the alleged violator to remove the livestock or to cause them to be removed immediately or within such reasonable time as may be specified. If the alleged violator fails to comply with the notice the range manager may proceed to exercise the proprietary right of the United States in the Federal range, under local impoundment law and procedure, if practicable; otherwise he may refer the matter through the usual channels for appropriate legal action by the United States against the violator.'
8
Whenever the charge consists of unlawfully grazing livestock, this section requires that written notice, as provided by § 161.11(a),4 together with an order to remove the livestock, be served on the alleged violator. Only 'if the alleged violator fails to comply with the notice' may the range manager proceed under local impoundment law and procedure. It is clear that both the written notice and failure to comply are express conditions precedent to the employment of local procedures. The Code is, of course, the law of the range, and the activities of federal agents are controlled by its provisions.5 They are required to follow the procedures there established.
9
The Court of Appeals held that there was no inconsistency between the federal regulation and the state statute because the regulation pertained to individual owners while the statute was aimed at 'abandoned' horses running loose on the range. We cannot agree. As we read it, the Utah statute is directed not to horses abandoned in the sense that they are ownerless, or that their owners cannot be located, but rather to horses considered 'abandoned' under an express statutory definition. As applied to horses 'at large upon the open range,' this definition depends only on branding and payment of prior tax assessment without any consideration of whether the horses are owned by someone and, if so, whether such owner is known or can be located. As the Court of Appeals itself recognized: 'The dictionary definition of the term 'abandoned' has no application.' 220 F.2d, at page 672. Furthermore, the record is replete with evidence that in this case the government agents actually did know that the horses belonged to petitioners and had not been abandoned. The District Court found that, 'said agents knew beyond any possible doubt to whom said horses belonged'; that 'the said agents and employees of defendant knew these brands to be the brands used by plaintiffs as well as they knew that the horses belonged to plaintiffs'; and concluded that the horses 'were used daily in the performance of the work of their owners, the plaintiffs, and this was well known by defendant's said agents and employees.' In the face of these findings, not disturbed by the Court of Appeals, it cannot be contended that the government agents were unable to comply with the specific provision for notice which regulated their actions. Nor has the Government contended that there was an attempt at any time to comply with the notice provisions of the Federal Range Code.
10
For these reasons we hold that the Utah abandoned horse statute was not properly invoked. The circumstances of this case were specifically provided for by § 161.11(b) of the Federal Range Code, and the government agents failed to comply with the terms of that section because the requisite notice was not given.
11
But, having concluded that there was no statutory authority, we are faced with the question whether the Government is liable under the Federal Tort Claims Act for wrongful and tortious acts of its employees committed in an attempt to enforce a federal statute which they administer. We believe there is such liability in the circumstances of this case.
12
Section 1346[b] of Title 28, United States Code, 28 U.S.C.A. § 1346(b), authorizes suits against the Government for 'loss of property * * * caused by the negligent or wrongful act * * * of any employee of the Government while acting within the scope of his office or employment, under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act * * * occurred.' It is clear that the federal agents here were acting within the scope of their employment under both state and federal law. Under the law of Utah an employer is liable to third persons for the willful torts of his employees if the acts are committed in furtherance of the employer's interests or if the use of force could have been contemplated in the employment. Cf. Barney v. Jewel Tea Co., 104 Utah 292, 139 P.2d 878. Both of these conditions obtained here. The federal agents were attempting to enforce the federal range law, and such enforcement must contemplate at least the force used in removal of stock from the range. The fact that the agents did not have actual authority for the procedure they employed does not affect liability. There is an area, albeit a narrow one, in which a government agent, like a private agent, can act beyond his actual authority and yet within the scope of his employment. We note also that § 1346(b) provides for liability for 'wrongful' as well as 'negligent' acts. In an earlier case the Court has pointed out that the addition of this word was intended to include situations like this involving "trespasses' which might not be considered strictly negligent.' Dalehite v. United States, 346 U.S. 15, 45, 73 S.Ct. 956, 972, 97 L.Ed. 1427.
13
Nor does 28 U.S.C. § 2680, 28 U.S.C.A. § 2680, bar liability here. This section provides that:
14
'The provisions of this chapter and section 1346(b) of this title shall not apply to—
15
'(a) Any claim based upon an act or omission of an employee of the Government, exercising due care, in the execution of a statute or regulation, whether or not such statute or regulation be valid, or based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the Government, whether or not the discretion involved be abused.'
16
The first portion of section (a) cannot apply here, since the government agents were not exercising due care in their enforcement of the federal law. 'Due care' implies at least some minimal concern for the rights of others. Here, the agents proceeded with complete disregard for the property rights of the petitioners. Nor can the second portion of (a) exempt the Government from liability. We are here not concerned with any problem of a 'discretionary function' under the Act, see Dalehite v. United States, supra. These acts were wrongful trespasses not involving discretion on the part of the agents, and they do give rise to a claim compensable under the Federal Tort Claims Act.
17
The District Court awarded damages in the lump sum of $100,000, the amount sought by petitioners jointly. Apparently this award was based on the value of the horses, consequential damages for deprivation of use and for 'mental pain and suffering.' Under the Federal Tort Claims Act, damages are determined by the law of the State where the tortious act was committed, 28 U.S.C. § 1346(b), 28 U.S.C.A. § 1346(b), subject to the limitations that the United States shall not be liable for 'interest prior to judgment or for punitive damages.' 28 U.S.C. § 2674, 28 U.S.C.A. § 2674. But it is necessary in any case that the findings of damages be made with sufficient particularity so that they may be reviewed. Here the District Court merely awarded the amount prayed for in the complaint. There was no attempt to allot any particular sum to any of the 30 plaintiffs, who owned varying numbers of horses and burros. There can be no apportionment of the award among the petitioners unless it be assumed that the horses were valued equally, the burros equally, and some assumption is made as to the consequential damages and pain and suffering of each petitioner. These assumptions cannot be made in the absence of pertinent findings, and the findings here are totally inadequate for review. The case must be remanded to the District Court for the appropriate findings in this regard.
18
Since the District Court did not possess the power to enjoin the United States, neither can it enjoin the individual agents of the United States over whom it never acquired personal jurisdiction. That part of the Court of Appeals judgment dissolving the injunction is affirmed. The remainder of the judgment is reversed and remanded to the District Court for proceedings not inconsistent with this opinion.
19
Reversed and remanded.
1
For example, No. 13 of the Findings of Fact made by the District Court states: 'Wood is the only fuel available to plaintiffs as a fuel for their fires, and it is necessary at certain times to travel by horse up to 15 or 20 miles to drag or haul wood to the camps or hogans. Water is also scarce and this must be carried by horse and burro for distances up to 10 miles from the camps. Trips to reach the pine nuts areas often require trips by horse for 150 miles, and to reach sites of certain ceremonies and other functions among the Navajo people often require plaintiffs and their families to travel on their horses for 150 miles. Seventy-five mile trips are required in their hunting expeditions which can only be done on horses. That the same use is made of burros as of horses by plaintiffs and the burro is held in the same esteem by them as are horses.'
2
The suit by the United States was dismissed by the District Court, 93 F.Supp. 745. The Court of Appeals reversed the dismissal and reinstated the complaint, United States v. Hosteen Tse-Kesi, 10 Cir., 191 F.2d 518. The suit was later dismissed by the District Court on June 27, 1953, for the reason that it was moot because the Indians had moved to the reservation and were no longer on the public lands. The suit brought by several white stockmen in a Utah state court resulted in an order enjoining certain Navajo Indians, including some of the petitioners, from trespassing and grazing livestock on the lands in question. Young v. Felornia, 121 Utah 646, 244 P.2d 862. A petition for certiorari in this suit was pending before this Court at the time the roundup was started. Certiorari was subsequently denied, 344 U.S. 886, 73 S.Ct. 186, 97 L.Ed. 685.
3
While the Government does not challenge particular findings, it does level a general charge that the trial was conducted in such an atmosphere of bias and prejudice that no factual conclusions of the court should be relied on. The Court of Appeals noted 'that the case was tried in an atmosphere of maximum emotion and a minimum of judicial impartiality.' 220 F.2d at page 670. After oral argument and a thorough consideration of the record, however, we do not find that the trial was conducted so improperly as to vitiate these findings. See National Labor Relations Board v. Donnelly Garment Co., 330 U.S. 219, 236—237, 67 S.Ct. 756, 765, 91 L.Ed. 854.
4
'§ 161.11 Procedure for enforcement of rules and regulations—(a) Service of notice. Whenever it appears that there has been any willful violation of any provision of the act or of the Federal Range Code for Grazing Districts, the range manager will cause the alleged violator * * * to be served with a written notice, which will set forth the act or acts constituting such violation and in which reference will be made to the provision or provisions of the act or the Federal Range Code for Grazing Districts alleged to have been violated. Such notice may be served in person or by registered mail and the affidavit of the person making personal service or the registry receipt shall be preserved.'
5
Section 16 of the Taylor Grazing Act, 48 Stat. 1275, 43 U.S.C. § 315n, 43 U.S.C.A. § 315n, reserves the power of the States to enforce 'statutes enacted for police regulation' on the public range. Section 161.11(b) of the Range Code provides the exclusive procedure for the invocation of such state statutes by federal agents.
| 78
|
351 U.S. 141
76 S.Ct. 724
100 L.Ed. 1021
Edwin B. COVEY, Committee of the Person and Property of Nora Brainard, an Incompetent, Appellant,v.TOWN OF SOMERS.
No. 380.
Argued March 29, 1956.
Decided May 7, 1956.
Mr.Samuel M. Sprafkin, New York City, for appellant.
Mr. Otto E. Koegel, Washington, D.C., for appellee.
Mr. John R. Davison, Albany, N.Y., for the State of New York, amicus curiae.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
The application of Article VII—A, Title 3, of the New York Tax Law, McK. Consol.Laws, c. 60, to the mentally incompetent ward of appellant is challenged as being repugnant to the Due Process and Equal Protection Clauses of the Fourteenth Amendment.
2
The statute, in § 165 et seq., provides for the judicial foreclosure of tax liens on real property. The filing at the county clerk's office of a list of taxes delinquent more than four years constitutes the filing of a notice of lis pendens and of a complaint, and commences an action against the property. Provision is made for notice by publication, by posting, and by mailing. The prescribed notice is to the effect that, unless the amount of unpaid tax liens, together with interest and penalties which are a lien against the property, are paid within 7 weeks, or an answer interposed within 20 days thereafter, any person having the right to redeem or answer shall be forever foreclosed of all his right, title, and interest and equity of redemption in and to the delinquent property. Provision is made for entry of a judgment of foreclosure awarding possession of the property to the tax district and directing execution of a deed conveying an estate in fee simple absolute to the district. The provisions of Title 3 purport to be applicable to and valid and effective with respect to all defendants, even though one or more of them be infants, incompetents, absentees, or nonresidents of the State of New York.
3
Section 165—h(7) makes the deed presumptive evidence of the regularity of the proceedings. After two years this presumption becomes conclusive. The Section further provides that no action to set aside the deed may be maintained unless commenced and a lis pendens notice filed prior to the time the presumption becomes conclusive.
4
We are met at the outset with the contention of appellee and the State of New York, amicus curiae, that an action, as distinguished from the motion in the original proceeding here utilized, was the exclusive remedy in this case. The statute itself contains no suggestion that a new action is the exclusive remedy; it merely limits the time within which an action may be brought to set aside the deed. The Second Department of the Appellate Division, which decided this case, has recognized the existence of equitable power to entertain a motion to open a default in an in rem tax proceeding.1 If that were not enough, appellee, on oral argument, conceded that in an action of the sort contemplated by § 165—h(7), the appellant would have been able to attack the deed only on the ground of alleged irregularities in the assessment and foreclosure proceedings. Although the Attorney General of New York has supported a contrary position, it was admitted at the argument that there was no decision to support his view. Our conclusion that the constitutional question was properly raised by appellant's motion is reinforced by the action of the Court of Appeals which amended its remittitur to disclose that a constitutional question was presented and necessarily decided on the appeal to that court. 308 N.Y. 941, 127 N.E.2d 90. Manifestly, no constitutional question could have been reached if the Court of Appeals had been of the opinion that the appellant had pursued the wrong remedy.
5
This proceeding started on May 8, 1952. The Town of Somers instituted it to foreclose many tax liens, one of which was its lien against the parcel of real property owned by the incompetent. In compliance with the statute, notice was given to the incompetent taxpayer by mail, by posting a notice at the post office, and by publication in two local newspapers. No answer having been filed by the incompetent, judgment of foreclosure was entered on September 8, 1952, and on October 24, 1952, a deed to her property was delivered to the town. Five days later, on October 29, 1952, Nora Brainard was certified by the County Court as a person of unsound mind, and one week later, November 6, 1952, she was committed to the Harlem Valley State Hospital for the insane. Thereafter, on February 13, 1953, appellant filed bond pursuant to an order appointing him Committee of the person and property of the incompetent.
6
Sometime prior to September 22, 1953, the town offered the incompetent's property for sale at a minimum bid price of $6,500. The unpaid taxes, interest, penalties, costs of foreclosure, attorney's fees, and maintenance charges on the property to September 22, 1953, aggregated $480. On that date, appellant's attorney appeared before the Town Board and offered to repay the town the amount due on the property in consideration of its return to the incompetent's estate. The offer was refused.2
7
Appellant then filed a motion in the County Court of Westchester County, where the judgment of foreclosure had been entered, for an order to show cause why the default should not be opened, the judgment vacated and the deed set aside, and permission granted 'to answer or appear or otherwise move with respect to' the notice of foreclosure. He alleged in a supporting affidavit that, although Nora Brainard's incompetency was known to the town officials, no guardian was appointed until shortly after the foreclosure. Appellant contended that the notice given to Nora Brainard, although in compliance with the statute, was inadequate in the case of a known incompetent, and, therefore, that the statute as applied was repugnant to the Fourteenth Amendment.
8
The trial court, finding that the incompetent had not been deprived of her constitutional rights and that the statute is valid, denied the motion. The Appellate Division of the Supreme Court, one judge dissenting, affirmed on the ground that the rights of the parties are fixed after expiration of the 7 weeks and 20 days provided for redemption or answer in § 165—a of the tax law. 283 App.Div. 883, 129 N.Y.S.2d 537. The Court of Appeals, which, as noted before, certified that a question under the Fourteenth Amendment was raised and necessarily decided, likewise affirmed. 308 N.Y. 798, 125 N.E.2d 862. We noted probable jurisdiction. 350 U.S. 882, 76 S.Ct. 138.
9
At this stage of the proceedings we are bound, as were the courts below, to assume that the facts are as disclosed by the uncontroverted affidavits filed with appellant's motion for an order to show cause. From these it appears that Nora Brainard was a long-time resident of the Town of Somers in the State of New York, and a person of means at all times financially able to meet her obligations, owning four pieces of improved real property in addition to the home property which has been taken by foreclosure. She lived alone, however, and had no relative in the State of New York or any other person present or available to assist her or to act in her behalf in connection with her taxes, despite the fact that she was and for upwards of 15 years had been an incompetent. Although she was known by the officials and citizens of the Town of Somers to be a person without mental capacity to handle her affairs or to understand the meaning of any notice served upon her, no attempt was made to have a Committee appointed for her person or property until after entry of the judgment of foreclosure in this proceeding.
10
Appellee argues that the Fourteenth Amendment does not require the State to take measures in giving notice to an incompetent beyond those deemed sufficient in the case of the ordinary taxpayer.
11
'An elementary and fundamental requirement of the process in any proceeding which is to be accorded finality is notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections. * * * (W)hen notice is a person's due, process which is a mere gesture is not due process. The means employed must be such as one desirous of actually informing the absentee might reasonably adopt to accomplish it.' Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 314—315, 70 S.Ct. 652, 657, 94 L.Ed. 865.
12
Notice to a person known to be an incompetent who is without the protection of a guardian does not measure up to this requirement. Assuming the truth of the uncontradicted assertions, that the taxpayer Nora Brainard was wholly unable to understand the nature of the proceedings against her property (from which it must be inferred that she was unable to avail herself of the statutory procedure for redemption or answer), and that the town authorities knew her to be an unprotected incompetent, we must hold that compliance with the statute would not afford notice to the incompetent and that a taking under such circumstances would be without due process of law. The question was appropriately raised and the issue improperly decided against the appellant. The judgment must, therefore, be reversed and the cause remanded for proceedings not inconsistent with this opinion.
13
Reversed and remanded.
14
Mr. Justice FRANKFURTER.
15
If the Court of Appeals saw the case as this Court sees it, reversal of its judgment, for the reasons given in the Court's opinion, would be required. My difficulty arises from the fact that this is so clear that I am compelled to wonder whether the New York Court of Appeals whose judges again and again have evinced due regard for due process would, by a summary disposition, sanction such a denial of due process. This Court has had frequent occasion to advert to the darkness which confronts us in trying to determine the meaning of state legislation and the scope of state remedies. This is particularly true when we are vouchsafed no light either from the Appellate Division or the Court of Appeals regarding the availability of subdivision 7 of § 165—h of the New York Tax Law in a situation, like the present, so obviously calling for relief as a matter of due process. The uncertainties of state law are not removed by conflicting views expressed at the bar of this Court by New York counsel.
16
Nor is my difficulty dissipated by the amended remittitur of the New York Court of Appeals. It reads as follows:
17
'Upon the appeal herein there was presented and necessarily passed upon a question under the Constitution of the United States, as follows: Whether the taking by the Town of Somers, of the property here involved, was, on this record, a deprivation of due process and equal protection of the laws under the Fourteenth Amendment. The Court of Appeals held that there was no denial of any constitutional right of the petitioner.' 308 N.Y. 798, 125 N.E.2d 862, as amended in 308 N.Y. 941, 127 N.E.2d 90.
18
To be sure, the Court of Appeals thus held 'that there was no denial of any constitutional right of the petitioner.' But, as that court said, it was only answering the question that was before it, namely, whether 'on this record' there was 'a deprivation of due process.' The court may have reached the conclusion it did because, as a matter of state law, the only thing it deemed before it was a reopening of the judgment of foreclosure under § 165—a, and that remedy was barred by the statute of limitations. Since the State has power to put a time limit on the re-opening of the judgment of foreclosure under that provision, such action is not a violation of the Fourteenth Amendment. The amended remittitur, thus read, does not preclude a setting aside of the foreclosure deed in a separate proceeding in accordance with § 165—h, subd. 7, on a recital of circumstances such as those which lead this Court to find a violation of due process.
19
If this hypothesis was in fact the basis of the judgment of the Court of Appeals, I assume it to be within the power of that court, when the case is returned, to allow full scope to state remedies still open to the petitioner.
1
Nelson v. City of New York, 283 App.Div. 722, 127 N.Y.S.2d 854. A subsequent motion to open the default was denied, 284 App.Div. 894, 134 N.Y.S.2d 597. That action was affirmed by the Court of Appeals, 309 N.Y. 94, 127 N.E.2d 827, and the case is pending on appeal to this Court, 351 U.S. 930, 76 S.Ct. 786.
2
Thereafter the town rescheduled the sale of the property at a minimum bid price of $3,500.
| 34
|
351 U.S. 183
76 S.Ct. 758
100 L.Ed. 1075
Raymond G. CAHILL, Petitioner,v.The NEW YORK, NEW HAVEN AND HARTFORD RAILROAD COMPANY.
No. 436.
Decided May 14, 1956.
Messrs.
William T. Griffin and Herbert Burstein, New York City, for movants.
Mr. Randolph J. Seifert, New York City, opposition.
PER CURIAM.
1
Respondent filed a motion to recall and amend the judgment in the above-entitled cause, 350 U.S. 898, 76 S.Ct. 180, for the purpose of remanding the cause to the United States Court of Appeals for the Second Circuit for further proceedings. Prior to the filing of this motion, and after the District Court denied an application for a stay of execution, the judgment was satisfied; but petitioner was informed that respondent intended to pursue its remedies notwithstanding payment of the judgment.
2
The motion of respondent to recall the judgment is granted. It is ordered that the certified copy of the judgment sent to the District Court be recalled and that the judgment be amended so as to provide for a remand of the cause to the United States Court of Appeals for the Second Circuit for further proceedings. Boudoin v. Lykes Brothers S.S. Co., 348 U.S. 336, 75 S.Ct. 382, 99 L.Ed. 354; Id., 350 U.S. 811, 76 S.Ct. 35; Rule 58(4), Supreme Court Rules, 28 U.S.C.A.
3
We deem our original order erroneous and recall it in the interest of fairness. Similar relief was requested by respondent in a petition for rehearing, denied in 350 U.S. 943, 76 S.Ct. 300. Rule 58(4) bars consecutive and out-of-time petitions for rehearing. The Boudoin case, however, concerned a motion to recall a judgment that asked for almost identical relief. Yet, if it had been considered a petition for rehearing, it was filed out of time. The grant of the motion in the Boudoin case shows that Rule 58(4) does not prohibit motions to correct this kind of error.
4
Compare as to mootness, Bakery Sales Drivers Local Union No. 33 v. Wagshal, 333 U.S. 437, 442, 68 S.Ct. 630, 632, 92 L.Ed. 792; Dakota County v. Glidden, 113 U.S. 222, 224, 5 S.Ct. 428, 429, 28 L.Ed. 981. The problems that may arise from demand for repayment are not before us.
5
Motion granted.
6
Mr. Justice BLACK, with whom The CHIEF JUSTICE, Mr. Justice DOUGLAS, and Mr. Justice CLARK join, dissenting.
7
In the interest of fairness we would not remand this case to the Court of Appeals. Cahill brought this action under the Federal Employers' Liability Act1 to recover for injuries sustained while working as a railroad brakeman. He was hurt on a busy highway which had railroad tracks running down its center. While flagging traffic behind a train stalled on these tracks Cahill was struck by a truck which started up suddenly. His complaint charged that the railroad was negligent in sending him to work in such a dangerous place without proper warning or instructions. The jury found for Cahill and awarded him damages. The railroad asked the Court of Appeals to reverse Cahill's judgment on two grounds: (1) there was insufficient evidence to permit submission of the case to the jury; (2) the trial judge erroneously admitted evidence of prior accidents at the scene of Cahill's injury offered to show the railroad's negligence in failing to warn him of dangers such as had brought about those accidents.
8
The Court of Appeals reversed on the ground that there was not sufficient evidence to support the verdict. 2 Cir., 224 F.2d 637. Having taken this action the Court of Appeals expressly stated that it did not find it necessary to pass on the alleged error in admitting the evidence of prior accidents. Cahill then asked us for certiorari. On November 21, 1955, we granted his petition and reversed the Court of Appeals' judgment, thereby reinstating the judgment of the District Court. 350 U.S. 898, 76 S.Ct. 180. Mr. Justice Reed dissented. Mr. Justice Frankfurter, Mr. Justice Burton, and Mr. Justice Harlan expressed the view that certiorari should have been denied; they did not participate in the decision on the merits.2 In a timely petition for rehearing the railroad called our attention to the fact that its objection to the evidence of prior accidents had never been passed on by the Court of Appeals, urging that we reconsider our judgment and modify it to the extent necessary to remand the cause to the Court of Appeals to pass on the question it had left undecided. This Court denied the petition for rehearing. 350 U.S. 943, 76 S.Ct. 300.
9
The railroad's present 'motion to recall' presents precisely the same contention which was raised in its petition for rehearing. We are asked once more to remand the case to the Court of Appeals for the Second Circuit for that court to determine whether there was error in admitting the evidence of prior accidents. Thus the 'motion to recall' turns out to be a petition for rehearing of a former petition for rehearing. Or in somewhat plainer language, the motion to recall turns out to be a second petition for rehearing. But Rule 58(4) of this Court declares that: 'Consecutive petitions for rehearings, and petitions for rehearing that are out of time under this rule, will not be received.' What is in fact a second petition for rehearing should not be received simply because it is labeled a 'motion to recall.'
10
There can be no possible doubt that a proper way to raise the sort of question here presented is by filing a petition for rehearing. Our records are filled with proof of this. The latest example is our action in Union Trust Co. v. Eastern Air Lines, Inc., 350 U.S. 962, 76 S.Ct. 429. We granted relief in that case of precisely the same kind that the railroad here asked us to grant in its petition for rehearing and asks us again to grant in its 'motion to recall.' There is nothing new about granting the relief here requested in response to a petition for rehearing. Upon one occasion Mr. Justice Bradley, speaking from the bench, said:
11
'It ought to be understood, or at least believed, whether it is true or not, that this Court, being a Court of last resort, gives great consideration to cases of importance and involving consequences like this, and there should be a finality somewhere. This custom of making motions for a rehearing is not a custom to be encouraged. It prevails in some States as a matter of ordinary practice to grant a rehearing on a mere application for it, but that practice we do not consider a legitimate one in this Court. It is possible that in the haste of examining cases before us, we sometimes overlook something, and then we are willing to have that pointed out, but to consider that this Court will reexamine the matter and change its judgment on a case, it seems to me, is not taking a proper view of the functions of this Court. * * *'3
12
This was an early recognition of the appropriateness of a motion for rehearing to raise points that have been overlooked. Thus, assuming that the point raised here was overlooked originally, it was correctly raised in the first petition for rehearing and that should end the matter if this Court's Rule 58(4) is to be followed.
13
Mr. Justice Bradley dealt with the problem of successive petitions for rehearing in Williams v. Conger, 131 U.S. 390, 9 S.Ct. 793, 33 L.Ed. 201. There the litigant claimed that a clerical error had been made in an opinion. A rehearing was asked on that gound but was denied. The Court concluded that 'no modification of the judgment was required, and no rehearing was necessary or called for. * * *' 131 U.S. at page 391, 9 S.Ct. at page 793. Later the same request was again made. Mr. Justice Bradley, speaking for the Court, expressed its strong lack of patience at the 'persistent renewal of the application * * * especially upon the same reasons, once overruled * * *.' Ibid. One would judge from the tone of the opinion in that case that the Court would not have reached a different result had the second motion for rehearing been labeled a 'motion to recall the judgment.' Our action in Boudoin v. Lykes Bros. S. S. Co., 350 U.S. 811, 76 S.Ct. 38, does not justify the Court in granting this motion to rehear a petition for rehearing formerly denied. In that case Boudoin appealed fron a judgment of the District Court in his favor, claiming: (a) the amount of damages awarded him was inadequate; and (b) the term of maintenance determined by the trial court was insufficient and should be extended and increased. The Court of Appeals undercut both of these alleged errors by holding that Boudoin was entitled to recover nothing at all. We reversed. 348 U.S. 336, 75 S.Ct. 382, 99 L.Ed. 354. Boudoin filed no petition for rehearing. He did ask us to amend our judgment so that the Court of Appeals could adjudicate the question of the amount of damages and we granted that motion. But our action there is not comparable to the action requested here. Had we denied Boudoin's motion and had he filed a later motion of the same kind I suppose we would not have considered it a second time. But here the Court is asked to review its judgment of reversal a second time. The substance of the pleadings and not their labels should govern our action. We should not grant what is in effect a second petition for rehearing unless the Court is willing to admit that it is refusing to give the rule against successive petitions for rehearing its literal meaning. There are strong arguments for allowing a second petition for rehearing where a rigid application of this rule would cause manifest injustice. Cf. Hormel v. Helvering, 312 U.S. 552, 556—559, 61 S.Ct. 719, 721—722, 85 L.Ed. 1037. But this is no such case.
14
We have never held that in every instance where the Court of Appeals has failed to decide a point, we must remand the cause to that Court. Such a rigid rule would be most undesirable and would bring about interminable delays with most unjust results. In Delk v. St. Louis & S.F.R. Co., 220 U.S. 580, 31 S.Ct. 617, 55 L.Ed. 590, a suit for injuries under the Safety Appliance Act, this Court, after reversing the Court of Appeals on the question, went on to decide a second question which the Court of Appeals had expressly left undecided. Mr. Justice Harlan, speaking for the Court, said: 'As the case is here upon certiorari to review the judgment of the Circuit Court of Appeals, this court has the entire record before it, with the power to review the action of that court, as well as direct such disposition of the case as that court might have done * * *.' 220 U.S. at page 588, 31 S.Ct. at page 621.4 More recently in O'Leary v. Brown-Pacific-Maxon, Inc., 340 U.S. 504, 71 S.Ct. 470, 95 L.Ed. 483, this Court again decided a question left undecided by the Court of Appeals. Mr. Justice Frankfurter, speaking for the Court, said: 'In this instance, however, we have a slim record and the relevant standard is not difficult to apply; and we think the litigation had better terminate now. Accordingly we have ourselves examined the record to assess the sufficiency of the evidence.' 340 U.S. at page 508, 71 S.Ct. at page 472. At least where there are unsubstantial points left undecided below this Court should not remand the case for consideration of those points.
15
Certainly there is no error asserted here that justifies sending this case back to the Court of Appeals. The error claimed relates to the admissibility of evidence concerning prior accidents. Cahill's case against the railroad was based in large part on the failure to give him proper instructions before sending him to work in a dangerous place when he had never done such work before. This made the railroad's knowledge of the danger of highway traffic at that location highly relevant in proving the railroad negligent. What better proof could there be than the fact that the railroad knew there had been repeated accidents at the same location of the kind that brought about Cahill's injury? No fair system of evidence would exclude such testimony when issues are raised like those involved here. As Mr. Justice Field, speaking for the Court, said in District of Columbia v. Arms, 107 U.S. 519, 525, 2 S.Ct. 840, 845, 27 L.Ed. 618: 'The frequency of accidents at a particular place would seem to be good evidence of its dangerous character—at least, it is some evidence to that effect.'5
16
We are told in this case that the railroad has already paid the judgment. For all we know that judgment was paid directly to Cahill. It is the general rule that voluntary payment of a judgment amounts to accord and satisfaction. Thorp v. Bonnifield, 177 U.S. 15, 18—19, 20 S.Ct. 533, 534—535, 44 L.Ed. 652. Payment under duress is of course a different matter. We do not know whether this judgment was paid under duress. It is true there is a statement in respondent's brief that it informed petitioner of its intention to pursue whatever remedies it had notwithstanding payment of the judgment. And the brief also states that the District Court declined to agree to a stay of execution. This statement is certainly not sufficient to show the kind of duress that ought to justify setting aside the payment of a judgment.6 Even if the facts alleged were sufficient, the question should be tried as one of fact before this Court takes the drastic action of trying to make a plaintiff pay back money that he has received under an order of this Court. Dakota County v. Glidden, 113 U.S. 222, 5 S.Ct. 428, 28 L.Ed. 981.7 If such summary action as here requested can be taken with reference to a judgment paid only a few days ago, why could it not be taken with reference to a judgment paid a year ago?8 Yet the Court, without investigating these problems, summarily grants the motion to recall and remands the case to the Court of Appeals.
17
I think the Court should deny this motion.
1
35 Stat. 65 as amended 45 U.S.C. § 51 et seq., 45 U.S.C.A. § 51 et seq.
2
See Carter v. Atlanta & St. A.B. Ry. Co., 338 U.S. 430, 438—439, 70 S.Ct. 226, 231, 94 L.Ed. 236; Schulz v. Pennsylvania R. Co., 350 U.S. 523, 527, 76 S.Ct. 608, 610, 611; and cases there cited.
3
Charles Evans Hughes, The Supreme Court of the United States (1928), 71—72. See also Frankfurter and Landis, The Business of the Supreme Court at October Term, 1931, 46 Harv.L.Rev. 226, 237: 'Of course, to deny a rehearing may conceivably be only an obstinate adherence to error. But surely, barring very exceptional circumstances, a rehearing implies a serious lack in the adjudicating process, a failure in mastering either the record or the pertinent legal considerations that govern the issues. * * *'
4
See also Harriman v. Northern Securities Co., 197 U.S. 244, 287, 25 S.Ct. 493, 501, 49 L.Ed. 739; Lutcher & Moore Lumber Co. v. Knight, 217 U.S. 257, 267—268, 30 S.Ct. 505, 509, 510, 54 L.Ed. 757; Lamar v. United States, 241 U.S. 103, 110—111, 36 S.Ct. 535, 537, 60 L.Ed. 912; Camp v. Gress, 250 U.S. 308, 318, 39 S.Ct. 478, 482, 63 L.Ed. 997; Langnes v. Green, 282 U.S. 531, 536—539, 51 S.Ct. 243, 245—246, 75 L.Ed. 520; Story Parchment Co. v. Paterson Parchment Paper Co., 282 U.S. 555, 567—568, 51 S.Ct. 248, 252, 75 L.Ed. 544.
5
See also the interesting discussion and cases cited in 2 Wigmore, Evidence (3d ed. 1940), §§ 252, 458. And see Notes: 65 A.L.R. 380, 81 A.L.R. 685, 128 A.L.R. 595, and cases there cited.
6
'Where a party pays an illegal demand with a full knowledge of all the facts which render such demand illegal, without an immediate and urgent necessity therefor, or unless to release his person or property from detention, or to prevent an immediate seizure of his person or property, such payment must be deemed voluntary and cannot be recovered back. And the fact that the party at the time of making the payment files a written protest does not make the payment involuntary.' Union Pac. Railroad Co. v. Commissioners, 98 U.S. 541, 543—544, 25 L.Ed. 196. See also Little v. Bowers, 134 U.S. 547, 554—558, 10 S.Ct. 620, 621—623, 33 L.Ed. 1016.
7
'But this courts is compelled, as all courts are, to receive evidence dehors the record affecting their proceeding in a case before them on error or appeal.' 113 U.S. at page 225, 5 S.Ct. at page 430. See also Wood-Paper Co. v. Heft, 8 Wall. 333, 19 L.Ed. 379.
8
The expiration of a Term of this Court is apparently no longer relevant. See 28 U.S.C. § 452, 28 U.S.C.A. § 452.
| 01
|
351 U.S. 215
76 S.Ct. 739
100 L.Ed. 1097
Paul Deemer JOHNSTON and John Sokol, Petitioners,v.UNITED STATES of America. UNITED STATES of America, Petitioner, v. Dudley A. PATTESON.
Nos. 643 and 704.
Argued May 2, 3, 1956.
Decided May 21, 1956.
Mr.Hayden C. Covington, Brooklyn, N.Y., for defendants.
Mr.Carl H. Imlay, Washington, D.C., for the United States.
Mr. Justice REED delivered the opinion of the Court.
1
These two cases concern the prosecution of three defendants for violations of the provisions of the Universal Military Training and Service Act. 50 U.S.C.A.Appendix, § 451 et seq., 50 U.S.C.A.Appendix, § 451 et seq. We must determine the proper venue for the trial of these crimes.
2
Defendants Johnston and Sokol resided in the Western Judicial District of Pennsylvania and registered there with the local draft boards. Both were classified 1—O (conscientious objectors) and both were ordered to report to the boards for assignment of civilian work in lieu of induction. They were instructed to report to separate state hospitals situated in the Eastern Judicial District of Pennsylvania. They reported to the boards but personally refused to comply with the instructions. They were indicted in the Eastern District of Pennsylvania and the indictments were dismissed for lack of jurisdiction on the ground that venue could only be in the Western District. 131 F.Supp. 955. The Court of Appeals for the Third Circuit reversed and remanded the case for trial. That court reasoned that venue was where the defendants failed to report. 3 Cir., 227 F.2d 745.
3
Defendant Patteson, likewise classified 1—O, was ordered to report to his local board in Oklahoma for similar assignment. He, too, reported to the board and there personally refused to comply with instructions to report at the Topeka, Kansas, State Hospital. After indictment in Kansas, the Kansas District Court ordered the case transferred to Oklahoma under Rule 21(b), Fed.Rules Crim.Proc., 18 U.S.C.A.1 The Oklahoma court retransferred the case to Kansas as it thought the venue was there. The Kansas court thereupon dismissed the indictment on the ground that the venue was in Oklahoma. United States v. Patteson, D.C., 132 F.Supp. 67. The judgment was affirmed by the Court of Appeals for the Tenth Circuit. 229 F.2d 257.
4
Each registrant received an order, the pertinent parts of which follow:
5
'SELECTIVE SERVICE SYSTEM
6
'Order to Report for Civilian Work and Statement of Employer
7
'You are ordered to report to the local board named above at m. on the day of , 195 , where you will be given instructions to proceed to the place of employment.
8
'You are ordered to report for employment pursuant to the instructions of the local board, to remain in employment for twenty-four (24) consecutive months or until such time as you are released or transferred by proper authority.
9
'You will be instructed as to your duties at the place of employment.
10
'Failure to report at the hour and on the day named in this order, or to proceed to the place of employment pursuant to instructions, or to remain in this employment the specified time will constitute a violation of the Universal Military Training and Service Act, as amended, which is punishable by fine or imprisonment or both. ..........
11
'(Clerk or Member of the Local Board)
12
'Statement of Employer
13
'Failed to report
14
..........epo
15
'Personal Director'2
16
None of the registrants entered the district of his indictment after receiving his orders.
17
The indictment in each case charges the registrant, a conscientious objector,3 with violation of § 12(a) of the Act.4 In the Johnston indictment the pertinent language is:
18
'* * * did knowingly neglect to perform a duty imposed upon him by the provision of said Act in that he failed and refused to obey an order of Local Board 87, New Castle, Pennsylvania, directing him to report for employment at Norristown State Hospital, Norristown, Pennsylvania, and to remain employed there for twenty-four consecutive months in violation of Title 50 U.S.C.Appx., Sections 456 and 462, as amended.'
In the Sokol case it is:
19
'* * * did knowingly neglect to perform a duty * * * in that he failed to report to the Philadelphia State Hospital, * * * for assignment to perform civilian work contributing to the maintenance of the national health, safety or interest, in lieu of induction; in violation of Title 50, Appx. Secs. 456(j) and 462.'
In the Patteson case it is:
20
'* * * did knowingly and willfully refuse, neglect and fail to report at the Topeka State Hospital at the time and place so designated in said order.'
21
The question at issue in these three cases is fairly presented by the registrants Johnston and Sokol in their petition for certiorari. It reads thus:
22
'Where each petitioner resided in the Western District of Pennsylvania, the Selective Service Local board of each was located in the Western District of Pennsylvania, the orders to perform work were issued in the Western District of Pennsylvania and each petitioner did not go beyond his local board in the Western District of Pennsylvania and at all times refused to leave the Western District of Pennsylvania and did not proceed to the Eastern District of Pennsylvania, were the offenses committed in the Western District of Pennsylvania and not in the Eastern District and, therefore, does it violate rights guaranteed by the Sixth Amendment to the Constitution to indict and prosecute each petitioner in the Eastern District of Pennsylvania?'
23
Our analysis of the law and the facts in these cases convinces us that the venue of these violations of the orders lies in the district where the civilian work was to be performed, that is, for Patteson in Kansas, and the Eastern District of Pennsylvania for Johnston and Sokol.
24
We are led to this conclusion by the general rule that where the crime charged is a failure to do a legally required act, the place fixed for its performance fixes the situs of the crime.5 The possibility that registrants might be ordered to report to points remote from the situs of draft boards neither allows nor requires judicial changes in the law of venue. No showing of any arbitrary action appears in these cases. Article III of the Constitution and the Sixth Amendment fix venue 'in the State' and 'district wherein the crime shall have been committed.' The venue of trial is thereby predetermined, but those provisions do not furnish guidance for determination of the place of the crime. That place is determined by the acts of the accused that violate a statute. This requirement of venue states the public policy that fixes the situs of the trial in the vicinage of the crime rather than the residence of the accused. Cf. United States v. Anderson, 328 U.S. 699, 705, 66 S.Ct. 1213, 1217, 90 L.Ed. 1529. A variation from that rule for convenience of the prosecution or the accused is not justified. The result would be delay and confusion.6
25
This rule was followed in United States v. Johnson, 323 U.S. 273, 65 S.Ct. 249, 89 L.Ed. 236, relied on by the registrants, where a maker and shipper of dentures mailed in Illinois was charged in Delaware, the State of receipt by a consignee, with violating the law by 'use' of the mails 'for the purpose of sending or bringing into' a State such dentures. Id., 323 U.S. at page 274, 65 S.Ct. at page 250. This Court, by interpretation of the statute, restricted prosecution of the shipper to the State of the shipment saying:
26
'It is a reasonable and not a strained construction to read the statute to mean that the crime of the sender is complete when he uses the mails in Chicago, and the crime of the unlicensed dentist in California or Florida or Delaware, who orders the dentures from Chicago, is committed in the State into which he brings the dentures. As a result, the trial of the sender is restricted to Illinois and that of the unlicensed dentist to Delaware or Florida or California.' Id., 323 U.S. at pages 277—278, 65 S.Ct. at page 251.7
27
Venue for these prosecutions lies where, under § 12(a), supra, the registrants did 'knowingly fail or neglect or refuse to perform any duty required of him under or in the execution of this title, or rules, regulations, or directions made pursuant to this title * * *.' These registrants were made subject to § 12(a) by § 6(j), which declares that a conscientious objector who fails or neglects to obey an order of his local board shall be deemed to have 'failed or neglected to perform a duty required of him' by § 12.8
28
The orders set out above, p. 741, could only be the basis of one conviction but they directed the registrant to perform two duties. The first is to report to the local board. This was done by each registrant. The second is to report for employment and to remain there in employment for 24 consecutive months. The 'instructions to proceed' given by the board and the statement that 'failure * * * to proceed to the place of employment pursuant to instructions' would constitute a crime, are for the registrant's information. They did not create another duty. This appears emphatically from the characterization in the explanatory paragraph that failure to report or proceed to the place of employment would be a violation of orders. The crimes charged arise from failure to complete the second duty—report for employment. Accordingly venue must lie where the failure occurred. See cases cited above, note 5.
29
It will be noted that the indictments set out the place of the alleged crimes in the terms of the orders and give jurisdiction for trial in the Eastern District of Pennsylvania and the District of Kansas. In each instance, the charge is failure to perform a 'duty' in that the registrant failed 'to report' to the respective hospitals. Thus, the indictments, based on the charged violation of the order, follow, as we see it, the requirements of law for trial in the State and district where the crime was committed.
30
We affirm the Court of Appeals for the Third Circuit in No. 643, Johnston and Sokol, and reverse the Court of Appeals for the Tenth Circuit in No. 704, the Patteson case.
31
No. 643, Affirmed.
32
No. 704, Reversed.
33
Mr. Justice DOUGLAS, with whom The CHIEF JUSTICE and Mr. Justice BLACK concur, dissenting.
34
Patteson, who lives in Oklahoma and defied his draft board there, is required to stand trial in Kansas. Johnston and Sokol, who live in the Western District of Pennsylvania and defied their draft board there, are forced by this decision to stand trial in the Eastern District. Yet each defied the law at home, not in the distant place. Unlike United States v. Anderson, 328 U.S. 699, 66 S.Ct. 1213, 90 L.Ed. 1529, no act of any kind was committed in the distant district. Unlike Rumely v. McCarthy, 250 U.S. 283, 39 S.Ct. 483, 63 L.Ed. 983, and United States v. Lombardo, 241 U.S. 73, 36 S.Ct. 508, 60 L.Ed. 897, Congress has not specifically selected the failure to perform an act in the distant district and made it a crime. The statutory crime is the failure of a conscientious objector, directed to perform civilian work, 'to obey any such order from his local board.' 62 Stat. 612, as amended, 65 Stat. 86, 50 U.S.C.Appendix, § 456(j), 50 U.S.C.A.Appendix, § 456(j). The argument in the case has been like a theological debate over the number of angels who can stand on the head of a pin. Of course, the duty to obey can be divied up into a whole series of duties. But, when the registrant is adamant in his refusal to budge from his home town and stays at home defying the local authorities, the crime he has committed has been committed at home.
35
Any doubts should be resolved in favor of the citizen. We should construe the statute against two historic constitutional provisions. Article III, § 2, cl. 3, provides that 'The Trial of all Crimes, except in Cases of Impeachment, shall be by Jury; and such Trial shall be held in the State where the said Crimes shall have been committed; but when not committed within any State, the Trial shall be at such Place or Places as the Congress may by Law have directed.' And the Sixth Amendment guarantees an accused 'a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law * * *.' While we have here a statutory problem, not a constitutional one, the history of the two constitutional guarantees throws light on the problem of venue. When the British Parliament proposed taking Americans abroad or to another colony for trial, the Virginia Resolves of May 16, 1969, voiced the unanimous view that 'thereby the inestimable Privilege of being tried by a Jury from the Vicinage, as well as the Liberty of summoning and producing Witnesses on such Trial, will be taken away from the Party accused.'*
36
The boys in the present cases suffer comparably. For their defiance of their local boards they are sent to distant places for trial where they have no friends, where they are unknown, and to which all witnesses must be transported. Congress would have the power to fix the venue there. But it has not done so unambiguously. Cf. United States v. Midstate Horticultural Co., 306 U.S. 161, 166, 59 S.Ct. 412, 414, 83 L.Ed. 563; United States v. Johnson, 323 U.S. 273, 276, 65 S.Ct. 249, 250, 89 L.Ed. 236. I would read the statute with an eye to history and try the offenders at home where our forefathers thought that normally men would receive the fairest trial.
1
'(b) Offense Committed in Two or More Districts or Divisions. The court upon motion of the defendant shall transfer the proceeding as to him to another district or division, if it appears from the indictment or information or from a bill of particulars that the offense was committed in more than one district or division and if the court is satisfied that in the interest of justice the proceeding should be transferred to another district or division in which the commission of the offense is charged.'
2
The stipulations in the Johnston and Sokol cases show the use of this form. The Patteson case also was argued on this understanding and defendant's motion to dismiss was sustained on allegations of fact that confirm our assumption that his order also was on the same form.
3
50 U.S.C.App. § 456(j), 50 U.S.C.A.Appendix, § 456(j):
'* * * Any person claiming exemption from combatant training and service because of such conscientious objections whose claim is sustained by the local board shall * * * in lieu of such induction, be ordered by his local board * * * to perform * * * such civilian work * * * as the local board may deem appropriate and any such person who knowingly fails or neglects to obey any such order from his local board shall be deemed, for the purposes of section 12 of this title * * *, to have knowingly failed or neglected to perform a duty required of him under this title * * *.'
4
50 U.S.C.App. § 462(a), 50 U.S.C.A.Appendix, § 462(a):
'Any * * * person * * * who in any manner shall knowingly fail or neglect or refuse to perform any duty required of him under or in the execution of this title * * *, or rules, regulations, or directions made pursuant to this title * * * shall, upon conviction in any district court of the United States of competent jurisdiction, be punished by imprisonment for not more than five years or a fine of not more than $10,000, or by both such fine and imprisonment * * *.'
5
Rumely v. McCarthy, 250 U.S. 283, 39 S.Ct. 483, 63 L.Ed. 983; United States v. Lombardo, 241 U.S. 73, 36 S.Ct. 508, 60 L.Ed. 897; Jones v. Pescor, 8 Cir., 169 F.2d 853; New York Central & H.R. Co., v. United States, 2 Cir., 166 F. 267. See cases cited in United States v. Anderson, 328 U.S. 699, 705, note 14, 66 S.Ct. 1213, 1217, 90 L.Ed. 1529, and see United States v. Wyman, D.C., 125 F.Supp. 276, 280. Compare state court decisions which hold that a State may punish a father for nonsupport of his child even though the defendant is outside the State while committing the offense. Comment, 6 Stan.L.Rev. 709.
6
Cf. United States v. Lombardo, 241 U.S. 73, 78, 36 S.Ct. 508, 510, 60 L.Ed. 897; Haas v. Henkel, 216 U.S. 462, 30 S.Ct. 249, 54 L.Ed. 569.
7
See also United States v. Wilson and United States v. Purchasing Corp., 344 U.S. 923, 73 S.Ct. 493, 97 L.Ed. 711, wherein an interpretation of a statutory duty to 'forward' a report of shipments under the Tobacco Tax Act, 63 Stat. 884, we approved the District Court judgment that venue for prosecution was in the district of the shipper rather than the district of the receiver of the report.
8
We ruled in the case of Dodez v. United States, 329 U.S. 338, 67 S.Ct. 301, 91 L.Ed. 331, that Dodez had exhausted his administrative remedies and therefore could defend on indictment his failure when he violated an order to report to the local board for work of national importance. Venue was laid in the District of the Board. No question was raised or decided here as to venue. Petition for certiorari, p. 2; Brief of the United States. Furthermore as the United States points out in this case, at the time of Dodez' breach, the Government delivered the conscientious objector registrants to the place of work. See Order to Report for Work, R. 155, No. 86, 1946 Term.
*
Journals of the House of Burgesses of Virginia, 1766—1769, p. 214.
| 23
|
351 U.S. 192
76 S.Ct. 763
100 L.Ed. 1081
UNITED STATES of America and Federal Communications Commission, Petitioners,v.STORER BROADCASTING COMPANY.
No. 94.
Argued Feb. 28, 29, 1956.
Decided May 21, 1956.
Mr.Warren E. Baker, for petitioner.
Mr. Albert R. Connelly, New York City, for respondent.
Mr. Justice REED delivered the opinion of the Court.
1
The Federal Communications Commission issued, on August 19, 1948, a notice of proposed rulemaking under the authority of 47 U.S.C. §§ 303(r), 311, 313 and 314, 47 U.S.C.A. §§ 303(r), 311, 313, 314 (Communications Act of 1934, as amended, 47 U.S.C. § 301 et seq., 47 U.S.C.A. § 301 et seq.). It was proposed, so far as is pertinent to this case, to amend Rules 3.35, 3.240 and 3.636 relating to Multiple Ownership of standard, FM and television broadcast stations. Those rules provide that licenses for broadcasting stations will not be granted if the applicant, directly or indirectly, has an interest in other stations beyond a limited number. The purpose of the limitations is to avoid overconcentration of broadcasting facilities.
2
As required by 5 U.S.C. § 1003(b), 5 U.S.C.A. § 1003(b), the notice permitted 'interested' parties to file statements or briefs. Such parties might also intervene in appeals. 47 U.S.C. § 402(d) and (e), 47 U.S.C.A. § 402(d, e). Respondent, licensee of a number of radio and television stations, filed a statement objecting to the proposed changes, as did other interested broadcasters. Respondent based its objections largely on the fact that the proposed rules did not allow one person to hold as many FM and television stations as standard stations. Storer argued that such limitations might cause irreparable financial damage to owners of standard stations if an obsolescent standard station could not be augmented by FM and television facilities.
3
In November 1953 the Commission entered an order amending the Rules in question without significant changes from the proposed forms.1 A review was sought in due course by respondent in the Court of Appeals for the District of Columbia Circuit under 5 U.S.C. § 1034, 5 U.S.C.A. § 1034,2 47 U.S.C. § 402(a), 47 U.S.C.A. § 402(a),3 and 5 U.S.C. § 1009(a), (c), 5 U.S.C.A. § 1009(a, c).4 Respondent alleged it owned or controlled, within the meaning of the Multiple Ownership Rules, seven standard radio, five FM radio and five television broadcast stations. It asserted that the Rules complained of were in conflict with the statutory mandates that applicants should be granted licenses if the public interest would be served and that applicants must have a hearing before denial of an application. 47 U.S.C. § 309(a) and (b), 47 U.S.C.A. § 309(a, b).5 Respondent also claimed:
4
'The Rules, in considering the ownership of one (1%) per cent or more of the voting stock of a broadcast licensee corporation as equivalent to ownership, operation or control of the station, are unreasonable and bear no rational relationship to the national Anti-Trust policy.'
5
This latter claim was important to respondent because allegedly 20% of its voting stock was in scattered ownership and was traded in by licensed dealers. This stock was thus beyond its control.
6
Respondent asserted it was a 'party aggrieved' and a 'person suffering legal wrong' or adversely affected under the several statutes that authorize review of FCC action. See notes 2, 3 and 4, supra. It stated its injuries from the Rules thus:
7
'Storer is adversely affected and aggrieved by the Order of the Commission adopted on November 25, 1953, amending the Multiple Ownership Rules, in that:
8
'(a) Storer is denied the right of a full and fair hearing to determine whether its ownership of an interest in more than seven (7) standard radio and five (5) television broadcast stations, in light of and upon a showing of all material circumstances, will thereby serve the public interest, convenience and necessity.
9
'(b) The acquisition of Storer's voting stock by the public under circumstances beyond the control of Storer, may and could be violative of the Multiple Ownership rules, as amended, and result in a forfeiture of licenses now held by Storer, with resultant loss and injury to Storer and to all other Storer stockholders.'
10
On the day the amendments to the Rules were adopted, a pending application of Storer for an additional television station at Miami was dismissed on the basis of the Rules.
11
While the question of respondent's right to appeal has not been raised by either party or by the Court of Appeals, our jurisdiction is now mooted. It may be considered. Federal Communications Commission v. National Broadcasting Co., 319 U.S. 239, 246, 63 S.Ct. 1035, 1038, 87 L.Ed. 1374. Jurisdiction depends upon standing to seek review and upon ripeness. If respondent could not rightfully seek review from the order adopting the challenged regulations, it must await action to its disadvantage under them, and neither the Court of Appeals nor this Court has jurisdiction of the controversy. Under the above-cited Code sections, review of Commission action is granted any party aggrieved or suffering legal wrong by that action.6
12
We think respondent had standing to sue at the time it exercised its privilege. The process of rulemaking was complete. It was final agency action, 5 U.S.C. § 1001(c) and (g), 5 U.S.C.A. § 1001(c, g), by which Storer claimed to be 'aggrieved.' When the authority to appeal was substantially the same, we held that an appellant who complained of the grant of a license to a competitor because it would reduce its own income had standing to appeal against a contention, admittedly sound, that such economic injury to appellant was not a proper issue before the Commission. We said:
13
'Congress had some purpose in enacting section 402(b)(2). It may have been of opinion that one likely to be financially injured by the issue of a license would by the only person having a sufficient interest to bring to the attention of the appellate court errors of law in the action of the Commission in granting the license. It is within the power of Congress to confer such standing to prosecute an appeal.' Federal Communications Comm'n v. Sanders Bros. Radio Station, 309 U.S. 470, 477, 60 S.Ct. 693, 698, 84 L.Ed. 869.
14
We added that such an appellant could raise any relevant question of law in respect to the order.
15
Again in Columbia Broadcasting System v. United States, 316 U.S. 407, 62 S.Ct. 1194, 86 L.Ed. 1563, this Court considered the problem of standing to review Commission action under the then existing § 402(a), 48 Stat. 1093, and the Urgent Deficiencies Act, 38 Stat. 219. CBS there sought review of the adoption of Chain Broadcasting Regulations by the Commission. Against the contention that the adoption of regulations did not command CBS to do or refrain from doing anything, dissent 316 U.S. at 429, 62 S.Ct. 1206, this Court held that the order promulgating regulations was reviewable because it presently affected existing contractual relationships. It said:
16
'The regulations are not any the less reviewable because their promulgation did not operate of their own force to deny or cancel a license. It is enough that failure to comply with them penalizes licensees, and appellant, with whom they contract. If an administrative order has that effect it is reviewable and it does not cease to be so merely because it is not certain whether the Commission will institute proceedings to enforce the penalty incurred under its regulations for non-compliance.' Id., 316 U.S. at pages 417 418, 62 S.Ct. at page 1200.
17
The Court said that the regulations 'presently determine rights.' Id., 316 U.S. at page 421, 62 S.Ct. at page 1202.
18
'Appellant's standing to maintain the present suit in equity is unaffected by the fact that the regulations are not directed to appellant and do not in terms compel action by it or impose penalties upon it because of its action or failure to act. It is enough that, by setting the controlling standards for the Commission's action, the regulations purport to operate to alter and affect adversely appellant's contractual rights and business relations with station owners whose applications for licenses the regulations will cause to be rejected and whose licenses the regulations may cause to be revoked.' Id., 316 U.S. at page 422, 62 S.Ct. at page 1202.
19
See Federal Communications Commission v. American Broadcasting Co., 347 U.S. 284, 289, 74 S.Ct. 593, 597, 98 L.Ed. 699, and EL Dorado Oil Works v. United States, 328 U.S. 12, 18—19, 66 S.Ct. 843, 846, 90 L.Ed. 1053.
20
The regulations here under consideration presently aggrieve the respondent. The Commission exercised a power of rulemaking which controls broadcasters. The Rules now operate to control the business affairs of Storer. Unless it obtains a modification of this declared administrative policy, Storer cannot enlarge the number of its standard of FM stations. It seems, too, that the note to Rule 3.636 (n. 1, supra) endangers Storer's stations as alleged in its petition for review. See this opinion, supra, 76 S.Ct. at page 767 at (b). Commission hearings are affected now by the Rules. Storer cannot cogently plan its present or future operations.7 It cannot plan to enlarge the number of its standard or FM stations, and at any moment the purchase of Storer's voting stock by some member of the public could endanger its existing structure. These are grievances presently restricting Storer's operations. In the light of the legislation allowing review of the Commission's actions, we hold that Storer has standing to bring this action.
21
In its petition for review Storer prayed the court to vacate the provisions of the Multiple Ownership Rules insofar as they denied to an applicant already controlling the allowable number of stations a 'full and fair hearing' to determine whether additional licenses to the applicant would be in the public interest.8 The Court of Appeals struck out, as contrary to § 309(a) and (b) of the Communications Act (n. 5, supra), the words italicized in Rule 3.636 (n. 1, supra) and the similar words in Rules 3.35 and 3.240. The case was remanded to the Commission with directions to eliminate these words. 95 U.S.App.D.C. 97, 220 F.2d 204. We granted certiorari 350 U.S. 816, 76 S.Ct. 52.
22
The Commission asserts that its power to make regulations gives it the authority to limit concentration of stations under a single control.9 It argues that rules may go beyond the technical aspects of radio, that rules may validly give concreteness to a standard of public interest, and that the right to a hearing does not exist where an applicant admittedly does not meet those standards as there would be no facts to ascertain. The Commission shows that its regulations permit applicants to seek amendments and waivers of or exceptions to its Rules.10 It adds:
23
'This does not mean, of course, that the mere filing of an application for a waiver * * * would necessarily require the holding of a hearing, for if that were the case a rule would no longer be a rule. It means only that it might be an abuse of discretion to fail to hear a request for a waiver which showed, on its face, the existence of circumstances making application of the rule inappropriate.'
24
Respondent defends the position of the Court of Appeals. It urges that an application cannot be rejected under 47 U.S.C. § 309, 47 U.S.C.A. § 309, without a 'full hearing' to applicant. We agree that a 'full hearing' under § 309 means that every party shall have the right to present his case or defense by oral or documentary evidence, to submit rebuttal evidence, and to conduct such cross-examination as may be required for a full and true disclosure of the facts. Cf. 5 U.S.C. § 1006(c), 5 U.S.C.A. § 1006(c). Such a hearing is essential for wise and just application of the authority of administrative boards and agencies.
25
We do not read the hearing requirement, however, as withdrawing from the power of the Commission the rulemaking authority necessary for the orderly conduct of its business. As conceded by Storer, 'Section 309(b) does not require the Commission to hold a hearing before denying a license to operate a station in ways contrary to those that the Congress has determined are in the public interest.'11 The challenged Rules contain limitations against licensing not specifically authorized by statute. But that is not the limit of the Commission's rulemaking authority. 47 U.S.C. § 154(i) and § 303(r), 47 U.S.C.A. §§ 154(i), 303(r), grant general rulemaking power not inconsistent with the Act or law.
26
This Commission, like other agencies, deals with the public interest. Scripps-Howard Radio v. Federal Communications Commission, 316 U.S. 4, 14, 62 S.Ct. 875, 882, 86 L.Ed. 1229. Its authority covers new and rapidly developing fields. Congress sought to create regulation for public protection with careful provision to assure fair opportunity for open competition in the use of broadcasting facilities. Accordingly, we cannot interpret § 309(b) as barring rules that declare a present intent to limit the number of stations consistent with a permissible 'concentration of control.' It is but a rule that announces the Commission's attitude on public protection against such concentration.12 The Communications Act must be read as a whole and with appreciation of the responsibilities of the body charged with its fair and efficient operation. The growing complexity of our economy induced the Congress to place regulation of businesses like communication in specialized agencies with broad powers. Courts are slow to interfere with their conclusions when reconcilable with statutory directions.13 We think the Multiple Ownership Rules, as adopted, are reconcilable with the Communications Act as a whole. An applicant files his application with knowledge of the Commission's attitude toward concentration of control.
27
In National Broadcasting Co. v. United States, 319 U.S. 190, 63 S.Ct. 997, 87 L.Ed. 1344, similar rules prohibiting certain methods of chain broadcasting were upheld despite a claim that the Rules caused licenses to be denied without 'examination of written applications presented * * * as required by §§ 308 and 309.' Id., 319 U.S. at page 230, 63 S.Ct. at page 1016.14 The National Broadcasting case validated numerous regulations couched in the prohibitory language of the present regulations. The one in the margin will serve as an example.15
28
In the National Broadcasting case we called attention to the necessity for flexiblity in the Rules there involved. 'Commission provided that 'networks will be given full opportunity, on proper application for new facilities or renewal of existing licenses, to call to our attention any reasons why the principle should be modified or held inapplicable." Id., 319 U.S. at apge 207, 63 S.Ct. at page 1005. We said:
29
'The Commission therefore did not bind itself inflexibly to the licensing policies expressed in the Regulations. In each case that comes before it the Commission must still exercise an ultimate judgment whether the grant of a license would serve the 'public interest, convenience, or necessity.' If time and changing circumstances reveal that the 'public interest' is not served by application of the Regulations, it must be assumed that the Commission will act in accordance with its statutory obligations.' Id., 319 U.S. at page 225, 63 S.Ct. at page 1013.
30
That flexibility is here under the present § 309(a) and (b) and the FCC's regulations. See n. 10, supra. We read the Act and Regulations as providing a 'full hearing' for applicants who have reached the existing limit of stations, upon their presentation of applications conforming to Rules 1.361(c) and 1.702, that set out adequate reasons why the Rules should be waived or amended. The Act, considered as a whole, requires no more. We agree with the contention of the Commission that a full hearing, such as is required by § 309(b), note 5, supra, would not be necessary on all such applications. As the Commission has promulgated its Rules after extensive administrative hearings, it is necessary for the accompanying papers to set forth reasons, sufficient if true, to justify a change or waiver of the Rules. We do not think Congress intended the Commission to waste time on applications that do not state a valid basis for a hearing. If any applicant is aggrieved by a refusal, the way for review is open.
31
We reverse the judgment of the Court of Appeals and remand the case to that court so that it may consider respondent's other objections to the Multiple Ownership Rules.
32
Reversed and remanded.
33
Mr. Justice DOUGLAS concurs in the result.
34
Mr. Justice HARLAN, concurring in part and dissenting in part.
35
The Court has properly deemed it necessary to question sua sponte the jurisdiction of the Court of Appeals to entertain this case,1 but I am unable to agree with its decision that such jurisdiction existed. In my view, Storer was not a 'party aggrieved by a final order' of the Commission, within the meaning of 5 U.S.C. § 1034, 5 U.S.C.A. § 1034, and hence was not entitled to invoke the jurisdiction of the Court of Appeals. Accordingly, I would vacate the judgment below and remand the case to the Court of Appeals with directions to dismiss the petition for lack of jurisdiction.
36
1. These regulations do not, in my view, constitute an 'order' within the meaning of § 1034. They simply establish certain standards to be followed by the Commission in the future exercise of its licensing powers; they do not require any licensee to do or to refrain from doing anything, attach no consequences to his action or inaction, and determine no questions as to his legal status. As such they are quite unlike the Chain Broadcasting regulations which were held to be a reviewable 'order' in Columbia Broadcasting System v. United States, 316 U.S. 407, 62 S.Ct. 1194, 86 L.Ed. 1563, in a proceeding comparable to this one. Those regulations were held reviewable, not because every Commission action in the form of a regulation was considered to be an 'order,' but for the specific reason that they proscribed certain kinds of contracts between licensees and the national networks and, by prescribing the sanction of license cancellation for noncompliance, operated to coerce action by the licensees and to determine the legal status of the networks' contracts. Of their own force and with no further administrative action being taken, the regulations induced licensees to cancel existing network contracts and deterred them from entering into new ones. That coercive effect of the regulations on present conduct, the very characteristic which led the Court to regard the Chain Broadcasting regulations as an 'order' despite their form, is totally lacking here.2
37
2. A second obstacle to review of the regulations here is that, even if they be deemed an 'order,' Storer has not shown that it is 'aggrieved' by them.
38
In assessing the character of Storer's grievance, we must put aside the Commission's order, made simultaneously with its promulgation of the challenged regulations, which denied a pending application by Storer for a sixth television license. That order was reviewable only by a direct appeal within 30 days under 47 U.S.C. § 402(b), (c), 47 U.S.C.A. § 402(b), (c), Federal Communications Commission v. Columbia Broadcasting System, 311 U.S. 132, 61 S.Ct. 152, 85 L.Ed. 87, and became final and conclusive upon Storer's failure to appeal from it. Since that order cannot be reviewed, and no relief from it may be granted in this proceeding, it is only of the prospective effect of the regulations, not their past application, that Storer may complain. And it is by that effect that Storer must show it is 'aggrieved.'
39
In its petition for review, Storer alleged that it was aggrieved by the regulations in that:
40
'(a) Storer is denied the right of a full and fair hearing to determine whether its ownership of an interest in more than seven (7) standard radio and five (5) television broadcast stations, in light of and upon a showing of all material circumstances, will thereby serve the public interest, convenience and necessity.
41
'(b) The acquisition of Storer's voting stock by the public under circumstances beyond the control of Storer, may and could be violative of the Multiple Ownership rules, as amended, and result in a forfeiture of licenses now held by Storer, with resultant loss and injury to Storer and to all other Storer stockholders.'
42
However these allegations are read, they assert no more than that the Commission may in the future take action pursuant to the regulations to deny or revoke a license. Of course, if such action should ever be taken, Storer would then be 'aggrieved.' But by the same token it would then have a complete remedy through a direct appeal from such action under § 402(b). Until such time as the regulations are applied to it, however, Storer will not have been 'aggrieved' and hence will not be entitled to review. Indeed, in this case we do not even reach often difficult problem whether an alleged injury is sufficient or of such a nature as to entitle the complaining party to review; here we have that rare case in which no present injury of any kind is even alleged.
43
It is said, however, that the regulations 'now operate to control the business affairs of Storer,' despite the absence of any such allegation by Storer. Since the Regulations do not have any coercive effect, I take that to mean only that Storer, if it exercises prudent business judgment, will take into account the announced policy of the Commission in deciding whether or not to apply for an additional license. No doubtt hat is true, but I fail to see show Storer has been 'aggrieved' by being told in advance one of the factors that will govern the disposition of any future license application on its part. If anything, Storer is now able to make a more enlightened judgment as to the probabilities of success in obtaining a further license.
44
3. So clear is it, in fact, that Storer has not been 'aggrieved' by the mere issuance of the regulations, that the Court's grant of review in this case must be premised not upon the effect of the regulations themselves, but simply upon Storer's interest in knowing whether or not a future application of them would be valid. The result is that the statutory procedure for obtaining relief from a present injury caused by an order has been converted into something quite different—namely, a procedure for obtaining a declaratory judgment as to the validity of a future application of new regulations. Not only is such a proceeding not authorized by the statute, however, but Storer would not have standing to invoke it even if it were.
45
That declaratory relief from future orders is not contemplated by § 1034 seems clear. That section authorizes review only of an 'order,' only if the order is 'final,' and only at the instance of one aggrieved 'by' the challenged order itself. The regulations here are not an 'order'; if they were it would not be 'final' since further administrative action must be taken before Storer will be affected; and Storer's grievance, if any, will be caused not 'by' the regulations but only by their future application. Moreover, quite apart from these obstacles, the procedure provided for by § 1034 is inappropriate for anticipatory equitable relief. That section requires, for example, that petitions for review be filed within 60 days after the order is issued. While such a time limitation is clearly appropriate to a procedure for relief from an injury already suffered, there seems no justification for so limiting the availability of declaratory relief from future action. Why should declaratory relief be denied as the threat of the future injury becomes more imminent, or be granted to those who have a sufficient interest to seek review immediately while being denied to those who later acquire a similar or even greater interest? Finally, no reason is apparent why existing procedures for declaratory judgments are not adequate; to construe § 1034 as an alternative declaratory judgment procedure simply produces the incongruous result of authorizing declaratory relief in the Courts of Appeals within 60 days after the order is issued and in the District Courts thereafter.
46
In the second place, even if § 1034 is to be construed as authorizing declaratory relief, I see no reason why the usual requirements for invoking equity jurisdiction should not be as applicable to such a proceeding as they are to an ordinary declaratory judgment action or to a proceeding to set aside a Commission order under the Urgent Deficiencies Act, the predecessor to § 1034 under which the CBS case arose. In that case, CBS's right to equitable relief in advance of the application of the regulations was expressly based on the irreparable injury it would suffer—the wholesale concellation of its contracts with licensees—before any further administrative action was taken and for which there was no other adequate remedy. Unless these requirements for equitable relief are to be abandoned, there can be no right to relief here, for Storer alleges no threatened injury of any kind, other than the possibility of future administrative action for which there would be a complete remedy by appeal.
47
It is said, however—again without support of any allegations by Storer—that Storer 'cannot cogently plan its present or future operations' unless it is advised whether or not the regulations are valid. But plans for expansion of communications facilities have always had to be made subject to the contingency that the Commission might refuse to grant the necessary license for any one of a number of reasons. Storer's position in this respect is now no different than it was before the regulations were issued: any plan to acquire a new station must simply take into account, among the several contingencies, the likelihood that a denial of a license under the regulations would be upheld on appeal. What this argument comes down to, therefore, is that Storer needs to know whether or not it can validly be denied a license under the regulations so that, if it can, it need not make an application. That is, the injury that Storer will have suffered if the decision on the validity of the regulations is postponed until Storer in fact applies for a license is the expense of making that very application, the same injury that is suffered by all unsuccessful license applicants. Until today, I should not have thought argument was necessary to reject such a basis for declaratory relief. Declaratory relief has been denied persons whose only alternative was to risk both dismissal from public employment and the imposition of criminal penalties, United Public Workers of America (C.I.O.) v. Mitchell, 330 U.S. 75, 67 S.Ct. 556, 91 L.Ed. 754, yet it is granted here to relieve Storer of the mere burden of making an application for a license.3
48
4. The holding of the Court today amounts to this: that regulations which impose no duty and determine no rights may be reviewed at the instance of a person who alleges no injury, to settle whether a future application of the regulations that may never occur would be valid. The lack of support for this decision is disclosed by the Court's primary reliance on CBS,4 a case which in my view not only fails to support the Court's conclusion but is persuasive, if not controlling, authority for precisely the opposite result.5 In my opinion, the implications of the decision undermine much of the settled law on reviewability of administrative action, and it is the more unfortunate because made without the benefit of briefs or argument by the parties. I cannot concur in that part the Court's opinion.
49
The Court having decided, however, that the Court of Appeals had jurisdiction, I concur with the Court on the merits.
50
Mr. Justice FRANKFURTER, dissenting.
51
While I agree that the amendatory Rules promulgated by the Federal Communications Commission relating to Multiple Ownership of standard, FM and television stations constitute a reviewable 'order' within the meaning of 5 U.S.C. § 1034, 5 U.S.C.A. § 1034, my Brother HARLAN'S reasoning convinces me that the respondent was not on the record before us a 'party aggrieved' under that section. Therefore the court below should not have entertained the petition to review the Commission's order.
52
Procedural and jurisdictional limitations on judicial action by the federal courts are not playthings of lawyers nor obstructions on the road of justice. Whether formulated by the Constitution, congressional enactments or settled judicial precedents, they are means designed to keep the courts within appropriate limits and to enforce rights according to general standards and not have them depend on the impact of the individual case. To be sure, dealing as we are with general standards, differences of views regarding their scope and applicability are bound to arise from time to time. Who is a 'party aggrieved' or a 'party in interest' turns on the context, often confused and dubious, of a particular set of circumstances and therefore raises issues on which judges not unnaturally divide, as they do on other unmathematical problems of the law. See Singer & Sons v. Union Pacific R. Co., 311 U.S. 295, 61 S.Ct. 254, 85 L.Ed. 198.
53
To the laity such matters may seem technicalities in a derogatory sense of the term. But this is only one phase of an attitude of mind that thinks ill of law which does not accord with private wishes. When informed by a legal adviser that to carry out his desires would encounter 'technical legal difficulties,' a strenuous President of the United States impatiently observed that 'all law is technicality.' But even professionally competent officials are at times impatient with decisions that fail to adjudicate substantive issues on which light is sought. It seems to me important, therefore, not to minimize the function of jurisdictional limitations upon adjudication by expressing views on the merits. There are, of course, exceptional situations where it is proper for a dissenter to go to the merits when a majority of theCourt removes from the case threshold objections of procedure and jurisdiction. See e.g., Ashwander v. Tennessee Valley Authority, 297 U.S. 288, 341, 56 S.Ct. 466, 480, 80 L.Ed. 688. This is not such a case.
1
Section 3.636 will illustrate the problem:
§ 3.636 Multiple ownership. (a) No license for a television broadcast station shall be granted to any party (including all parties under common control) if:
'(1) Such party directly or indirectly owns, operates, or controls another television broadcast station which serves substantially the same area; or
'(2) Such party, or any stockholder, officer or director of such party, directly or indirectly owns, operates, controls, or has any interest in, or is an officer or director of any other television broadcast station if the grant of such license would result in a concentration of control of television broadcasting in a manner inconsistent with public interest, convenience, or necessity. In determining whether there is such a concentration of control, consideration will be given to the facts of each case with particular reference to such factors as the size, extent and location of areas served, the number of people served, and the extent of other competitive service to the areas in question. The Commission, however, will in any event consider that there would be such a concentration of control contrary to the public interest, convenience or necessity for any party or any of its stockholders, officers or directors to have a direct or indirect interest in, or be stockholders, officers, or directors of, more than five television broadcast stations.'* (The italicized material is common to all three Rules.)
*
'In applying the provisions of paragraph (a) of this section to the stockholders of a corporation which has more than 50 voting stockholders, only those stockholders need be considered who are officers or directors or who directly or indirectly own 1 per cent or more of the outstanding voting stock.' 47 CFR, Rev. 1953. The standard and FM Rules limited stations to seven.
2
'Any party aggrieved by a final order reviewable under this chapter may, within sixty days after entry of such order, file in the court of appeals, wherein the venue as prescribed by section 1033 of this title lies, a petition to review such order. * * *'
3
'(a) Any proceeding to enjoin, set aside, annul, or suspend any order of the Commission under this chapter (except those appealable under subsection (b) of this section) shall be brought as provided by and in the manner prescribed in chapter 19A of Title 5.'
4
'Except so far as (1) statutes preclude judicial review or (2) agency action is by law committed to agency discretion—
'(a) Any person suffering legal wrong because of any agency action, or adversely affected or aggrieved by such action within the meaning of any lelevant statute, shall be entitled to judicial review thereof.
'(c) Every agency action made reviewable by statute and every final agency action for which there is no other adequate remedy in any court shall be subject to judicial review. * * *'
5
47 U.S.C. § 309, 47 U.S.C.A. § 309:
'Examination; action by Commission.
'(a) If upon examination of any application provided for in section 308 of this title the Commission shall find that public interest, convenience, and necessity would be served by the granting thereof, it shall grant such application.
'Notification of denial; contents; reply; hearing; intervention.
'(b) If upon examination of any such application the Commission is unable to make the finding specified in subsection (a) of this section, it shall forthwith notify the applicant and other known parties in interest of the grounds and reasons for its inability to make such finding. * * * Following such notice, the applicant shall be given an opportunity to reply. If the Commission, after considering such reply, shall be unable to make the finding specified in subsection (a) of this section, it shall formally designate the application for hearing on the grounds or reasons then obtaining and shall notify the applicant * * * specifying with particularity the matters and things in issue * * *. Any hearing subsequently held upon such application shall be a full hearing in which the applicant and all other parties in interest shall be permitted to participate but in which both the burden of proceeding with the introduction of evidence upon any issue specified by the Commission, as well as the burden of proof upon all such issues, shall be upon the applicant.'
6
Legal wrong, as a ground for standing to appeal, was introduced by the Administrative Procedure Act, § 10(a). 60 Stat. 243. In explanation the reports of the Senate, No. 752, 79th Cong., 1st Sess. 26, and the House, No. 1980, 79th Cong., 2d Sess. 42, define 'legal wrong': 'The phrase 'legal wrong' means such a wrong as is specified in section 10(e). It means that something more than mere adverse personal effect must be shown in order to prevail—that is, that the adverse effect must be an illegal effect.'
Section 10(e) of the bill required reviewing courts to 'hold unlawful any action * * * (3) contrary to statutes or statutory right.' Section 10(e) of the Act is now in substantially the same language. 5 U.S.C. § 1009(e), 5 U.S.C.A. § 1009(e).
7
Cf. Frozen Food Express v. United States, 351 U.S. 40, 43 44, 76 S.Ct. 569, 571.
8
Storer also attacked the 1% ownership provision that appears as a note to Rule 3.636, n. 1, supra. This was not passed upon by the Court of Appeals. 95 U.S.App.D.C. 97, 220 F.2d 204. Its judgment leaves that portion of the Rule unaffected. As there was no cross petition for certiorari, we leave open the question of its validity.
9
'The Commission may perform any and all acts, make such rules and regulations, and issue such orders, not inconsistent with this chapter, as may be necessary in the execution of its function.' 47 U.S.C. § 154(i), 47 U.S.C.A. § 154(i).
'Except as otherwise provided in this chapter, the Commission from time to time, as public convenience, interest, or necessity requires, shall—
'(f) Make such regulations not inconsistent with law as it may deem necessary to prevent interference between stations and to carry out the provisions of this chapter:
'(r) Make such rules and regulations and prescribe such restrictions and conditions, not inconsistent with law, as may be necessary to carry out the provisions of this chapter, * * *.' 47 U.S.C. § 303, 47 U.S.C.A. § 303.
10
47 CFR, Rev.1953, § 1.361(c):
'(c) Applications which, because of the nature of the particular rule, regulation, or requirement involved, are patently not in accordance with the Commission's rules, regulations, or other requirements will be considered defective and will be dismissed unless accompanied by a request of the applicant for waiver of, or exception to, any rule, regulation, or requirements with which the application is in conflict. Such requests shall show the nature of the waiver or exception desired and set forth the reasons in support thereof.'
Section 1.702:
'Petition for amendment or waiver of rules. Any interested person may petition for issuance, amendment, repeal or waiver of any rule or regulation. Such petition shall show the text of the proposed rule, or its change, and set forth the reason in support of the petition.' See also, 47 CFR, 1941 Supp., §§ 1.72, 1.81.
11
See 47 U.S.C. §§ 310 and 311, 47 U.S.C.A. §§ 310, 311. Cf. Ashbacker Radio Corp. v. Federal Communications Commission, 326 U.S. 327, 333, n. 9, 66 S.Ct. 148, 151, 90 L.Ed. 108; and 47 CFR, Rev. 1953 § 1.724; Felman v. United States, 339 U.S. 973, 70 S.Ct. 1030, 94 L.Ed. 1379; Federal Communications Comm'n v. American Broadcasting Co., 347 U.S. 284, 74 S.Ct. 593, 98 L.Ed. 699.
12
See National Broadcasting Co. v. United States, 319 U.S. 190, 196, 63 S.Ct. 997, 1000. We said last Term that determination of improper concentration of control was for appraisal by the Commission after hearing. Federal Communications Commission v. Allentown Broadcasting Co., 349 U.S. 358, 363—364, 75 S.Ct. 855, 858, 859, 99 L.Ed. 1147.
13
See Unemployment Compensation Commission of Territory of Alaska v. Aragan, 329 U.S. 143, 153, 67 S.Ct. 245, 250, 91 L.Ed. 136; O'Leary v. Brown-Pacific-Maxon, 340 U.S. 504, 508, 71 S.Ct. 470, 472.
14
Point III of the National Broadcasting Company brief argued the matter under this heading, 'The Commission Cannot Escape Its Duty to Evaluate and Decide Each License Application on Its Own Facts.' At that time § 309(a) had the hearing provision. It read:
'Sec. 309. (a) If upon examination of any application for a station license or for the renewal or modification of a station license the Commission shall determine that public interest, convenience, or necessity would be served by the granting thereof, it shall authorize the issuance, renewal, or modification thereof in accordance with said finding. In the event the Commission upon examination of any such application does not reach such decision with respect thereto, it shall notify the applicant thereof, shall fix and give notice of a time and place for hearing thereon, and shall afford such applicant an opportunity to be heard under such rules and regulations as it may prescribe.' 48 Stat. 1085.
Change to the present form was merely for more certainty and clarification to avoid the possibility of arbitrary Commission action. See S.Rep. No. 44, 82d Cong., 1st Sess. 8.
15
"No license shall be granted to a standard broadcast station having any contract, arrangement, or understanding, express or implied, with a network organization under which the station is prevented or hindered from, or penalized for, broadcasting the programs of any other network organization." Id., 319 U.S. at page 200, 63 S.Ct. at page 1002; 47 CFR, 1941 Supp., § 3.101.
1
Although the question of reviewability was not raised below or argued here, there can be no doubt of the power of the Court to consider the issue sua sponte, since it goes to the jurisdiction of the Court of Appeals and of this Court. Cf. Federal Communications Commission v. National Broadcasting Co., 319 U.S. 239, 246, 63 S.Ct. 1035, 1038, 87 L.Ed. 1374; Rochester Telephone Corp. v. United States, 307 U.S. 125, 128, n. 3, 59 S.Ct. 754, 756, 83 L.Ed. 1147; American Federation of Labor v. National Labor Relations Board, 308 U.S. 401, 404, 60 S.Ct. 300, 301, 84 L.Ed. 347. The jurisdiction of the Courts of Appeals to review orders of the Federal Communications Commission, other than those granting or denying licenses, is granted by the Act of December 29, 1950, 64 Stat. 1129, 5 U.S.C. §§ 1031—1042, 5 U.S.C.A. §§ 1031—1042. Section 1032, which confers the jurisdiction, provides that 'Such jurisdiction shall be invoked by the filing of a petition as provided in section 1034.' Section 1034, in turn, provides that 'Any party aggrieved by a final order * * * may, within sixty days after entry of such order, file in the court of appeals * * * a petition to review such order.' In short, the court's jurisdiction may be invoked only upon the petition of a 'party aggrieved by a final order.'
2
Insofar as the Multiple Ownership regulations provide for the revocation of existing licenses upon the purchase by a licensee of a stock interest in more than the maximum number of stations, they could arguably be deemed an 'order' forbidding licensees, under pain of license revocation, to engage in stock transactions the result of which would violate the numerical limitations. Storer is not complaining, however, of any such deterrent effect of the regulations and does not allege that it desires either to buy or to sell stock in any licensee. It objects only to the possibility of a future loss of a license should persons beyond its control—and, by hypothesis, not deterred by the regulations—purchase its stock. See paragraph (b) of Storer's allegations, 76 S.Ct. at page 773, infra.
3
The recent holding of this Court in East Texas Motor Freight Lines, Inc., v. Frozen Food Express, 351 U.S. 49, 76 S.Ct. 574, does not support the result reached here. In that case the declaratory interpretation of the Interstate Commerce Act—sought by way of review of the Commission's interpretative regulations in a proceeding under the Urgent Deficiencies Act—was considered justified because of the possibility of criminal penalties being imposed for violations of the Act and the risk of loss of substantial investments in operations that might subsequently be enjoined by the Commission. No such necessity for declaratory relief is even alleged here; there is no threat of criminal prosecutions and, since a license is always a condition precedent to acquisition of a new station, there is no danger of the loss of investments to be made prior to the future administrative action.
4
Of the other cases cited by the Court, only Federal Communications Commission v. American Broadcasting Co., 347 U.S. 284, 74 S.Ct. 593, 98 L.Ed. 699, involved a similar stituation, and there the jurisdictional problem was neither raised by the parties nor noted by the Court.
5
Throughout the opinion in the CBS case, the Court emphasized the exceptional circumstances which justified immediate review of the Chain Broadcasting regulations and distinguished them from regulations of the sort here involved. See, e.g., 316 U.S. at pages 424—425, 62 S.Ct. at pages 1203, 1204:
'We need not stop to discuss here the great variety of administrative rulings which, unlike this one, are not reviewable either because they do not adjudicate rights or declare them legislatively, or because there are adequate administrative remedies which must be pursued before resorting to judicial remedies, or because there is no occasion to resort to equitable remedies. But we should not for that reason fail to discriminate between them and this case in which, because of its peculiar circumstances, all the elements prerequisite to judicial review are present. The ultimate test of reviewability is not to be found in an overrefined technique, but in the need of the review to protect from the irreparable injury threatened in the exceptional case by administrative rulings which attach legal consequences to action taken in advance of other hearings and adjudications that may follow, the results of which the regulations purport to control.'
| 78
|
351 U.S. 225
76 S.Ct. 714
100 L.Ed. 1112
RAILWAY EMPLOYES' DEPARTMENT, American Federation of Labor, International Association of Machinists, et al., Appellants,v.Robert L. HANSON, Horace A. Cameron, Harold J. Grau, et al.
No. 451.
Argued May 2, 1956.
Decided May 21, 1956.
Motion Denied June 11, 1956.
See 351 U.S. 979, 76 S.Ct. 1044.
[Syllabus from pages 225-226 intentionally omitted]
Mr.Lester P. Schoene, Washington, D.C., for appellants.
Mr. Edson Smith, Omaha, Neb., for appellees.
Mr. Robert A. Nelson, for State of Nebraska, amicus curiae, by special leave of Court.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
This is a suit brought in the Nebraska courts by employees of the Union Pacific Railroad Co. against that company and labor organizations representing various groups of employees of the railroad to enjoin the application and enforcement of a union shop agreement entered into between the railroad company and the labor organizations. Plaintiffs are not members of any of the defendant labor organizations and desire not to join. Under the terms of the union shop agreement all employees of the railroad, as a condition of their continued employment, must become members of the specified union within 60 days and thereafter maintain that membership. It is alleged that failure on their part to join the union will mean the loss of their employment together with seniority, retirement, pension, and other rights.
2
The employees claim that the union shop agreement violates the 'right to work' provision of the Nebraska Constitution, Art. XV, § 13, which provides:1
3
'No person shall be denied employment because of membership in or affiliation with, or resignation or expulsion from a labor organization or because of refusal to join or affiliate with a labor organization; nor shall any individual or corporation or association of any kind enter into any contract, written or oral, to exclude persons from employment because of membership in or nonmembership in a labor organization.'
4
They ask for an injunction restraining the railroad company from enforcing and applying the union shop agreement.
5
The answers deny that the Nebraska Constitution and laws control and allege that the union shop agreement is authorized by § 2, Eleventh of the Railway Labor Act, as amended, 64 Stat. 1238, 45 U.S.C. § 152, Eleventh, 45 U.S.C.A. § 152, subd. 11, which provides that, notwithstanding the law of 'any State,' a carrier and a labor organization may make an agreement requiring all employees within a stated time to become a member of the labor organization, provided there is no discrimination against any employee and provided that membership is not denied nor terminated 'for any reason other than the failure of the employee to tender the periodic dues, initiation fees, and assessments (not including fines and penalties) uniformly required as a condition of acquiring or retaining membership.'2
6
The Nebraska trial court issued an injunction. The Supreme Court of Nebraska affirmed. It held that the union shop agreement violates the First Amendment in that it deprives the employees of their freedom of association and violates the Fifth Amendment in that it requires the members to pay for many things besides the cost of collective bargaining. The Nebraska Supreme Court, therefore, held that there is no valid federal law to supersede the 'right to work' provision of the Nebraska Constitution. 160 Neb. 669, 71 N.W.2d 526. The case is here by appeal. 28 U.S.C. § 1257(1) and (2), 28 U.S.C.A. § 1257(1, 2). We noted probable jurisdiction. 350 U.S. 910, 76 S.Ct. 195.
7
The union shop3 provision of the Railway Labor Act was written into the law in 1951. Prior to that date the Railway Labor Act prohibited union shop agreements. 48 Stat. 1186, 45 U.S.C. § 152, Fourth and Fifth, 45 U.S.C.A. § 152, subds. 4, 5; 40 Op.Atty.Gen. 254. Those provisions were enacted in 1934 when the union shop was being used by employers to establish and maintain company unions, 'thus effectively depriving a substantial number of employees of their right to bargain collectively.' S.Rep.No. 2262, 81st Cong., 2d Sess., p. 3. By 1950, company unions in this field had practically disappeared. Id. Between 75 and 80% of railroad employees were members of labor organizations. H.R.Rep.No.2811, 81st Cong., 2d Sess., p. 4. While nonunion members got the benefits of the collective bargaining of the unions, they bore 'no share of the cost of obtaining such benefits.' Id., at p. 4. As Senator Hill, who managed the bill on the floor of the Senate, said, 'The question in this instance is whether those who enjoy the fruits and the benefits of the unions should make a fair contribution to the support of the unions.' 96 Cong.Rec., Pt. 12, p. 16279.
8
The union shop provision of the Railway Labor Act is only permissive. Congress has not compelled nor required carriers and employees to enter into union shop agreements. The Supreme Court of Nebraska nevertheless took the view that justiciable questions under the First and Fifth Amendments were presented since Congress, by the union shop provision of the Railway Labor Act, sought to strike down inconsistent laws in 17 States. Cf. Hudson v. Atlantic Coast Line R. Co., 242 N.C. 650, 89 S.E.2d 441; Otten v. Baltimore & O.R. Co., 2 Cir., 205 F.2d 58. The Supreme Court of Nebraska said, 'Such action on the part of Congress is a necessary part of every union shop contract entered into on the railroads as far as these 17 states are concerned for without it such contracts could not be enforced therein.' 160 Neb. at page 698, 71 N.W.2d at page 547. We agree with that view. If private rights are being invaded, it is by force of an agreement made pursuant to federal law which expressly declares that state law is superseded. Cf. Smith v. Allwright, 321 U.S. 649, 663, 64 S.Ct. 757, 764, 88 L.Ed. 987. In other words, the federal statute is the source of the power and authority by which any private rights are lost or sacrificed.4 Cf. Steele v. Louisville & N.R. Co., 323 U.S. 192, 198—199, 204, 65 S.Ct. 226, 230, 232, 89 L.Ed. 173; Brotherhood of Railroad Trainmen v. Howard, 343 U.S. 768, 72 S.Ct. 1022, 96 L.Ed. 1283; Public Utilities Commission of District of Columbia v. Pollak, 343 U.S. 451, 462, 72 S.Ct. 813, 820, 96 L.Ed. 1068. The enactment of the federal statute authorizing union shop agreements is the governmental action on which the Constitution operates, though it takes a private agreement to invoke the federal sanction.
9
As already noted, the 1951 amendment, permitting the negotiation of union shop agreements, expressly allows those agreements notwithstanding any law 'of any State.' § 2, Eleventh.5 A union agreement made pursuant to the Railway Labor Act has, therefore, the imprimatur of the federal law upon it and, by force of the Supremacy Clause of Article VI of the Constitution, could not be made illegal nor vitiated by any provision of the laws of a State.
10
We come then to the merits.
11
In the absence of conflicting federal legislation, there can be no doubt that it is within the police power of a State to prohibit the union or the closed shop. We so held in Lincoln Federal Labor Union No. 19129, A.F. of L. v. Northwestern Iron & Metal Co., 335 U.S. 525, 69 S.Ct. 251, 93 L.Ed. 212, and in American Federation of Labor v. American Sash & Door Co., 335 U.S. 538, 69 S.Ct. 258, 93 L.Ed. 222, against the challenge that local 'right to work' laws, including Nebraska's, violated the requirements of due process. But the power of Congress to regulate labor relations in interstate industries is likewise well-established. Congress has authority to adopt all appropriate measures to 'facilitate the amicable settlement of disputes which threaten the service of the necessary agencies of interstate transportation.' Texas & N.O.R. Co. v. Brotherhood of Railway & S.S. Clerks, 281 U.S. 548, 570, 50 S.Ct. 427, 433, 74 L.Ed. 1034. These measures include provisions that will encourage the settlement of disputes 'by inducing collective bargaining with the true representative of the employees and by preventing such bargaining with any who do not represent them', Virginian Ry. Co. v. System Federation No. 40, 300 U.S. 515, 548, 57 S.Ct. 592, 600, 81 L.Ed. 789, and that will protect the employees against discrimination or coercion which would interfere with the free exercise of their right to self-organization and representation. National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U.S. 1, 33, 57 S.Ct. 615, 622, 81 L.Ed. 893. Industrial peace along the arteries of commerce is a legitimate objective; and Congress has great latitude in choosing the methods by which it is to be obtained.
12
The choice by the Congress of the union shop as a stabilizing force seems to us to be an allowable one. Much might be said pro and con if the policy issue were before us. Powerful arguments have been made here that the longrun interests of labor would be better served by the development of democratic traditions in trade unionism without the coercive element of the union or the closed shop. Mr. Justice Brandeis, who had wide experience in labor-management relations prior to his appointment to the Court, wrote forcefully against the closed shop. He feared that the closed shop would swing the pendulum in the opposite extreme and substitute 'tyranny of the employee' for 'tyranny of the employer.'6 But the question is one of policy with which the judiciary has no concern, as Mr. Justice Brandeis would have been the first to concede. Congress, acting within its constitutional powers, has the final say on policy issues. If it acts unwisely, the electorate can make a change. The task of the judiciary ends once it appears that the legislative measure adopted is relevant or appropriate to the constitutional power which Congress exercises. The ingredients of industrial peace and stabilized labor-management relations are numerous and complex. They may well vary from age to age and from industry to industry. What would be needful one decade might be anathema the next. The decision rests with the policy makers, not with the judiciary.
13
It is said that the right to work, which the Court has frequently included in the concept of 'liberty' within the meaning of the Due Process Clauses (see Truax v. Raich, 239 U.S. 33, 36 S.Ct. 7, 60 L.Ed. 131; Takahashi v. Fish & Game Commission, 334 U.S. 410, 68 S.Ct. 1138, 92 L.Ed. 1478), may not be denied by the Congress. The question remains, however, whether the long-range interests of workers would be better served by one type of union agreement or another. That question is germane to the exercise of power under the Commerce Clause—a power that often has the quality of police regulations. See Cleveland v. United States, 329 U.S. 14, 19, 67 S.Ct. 13, 15, 91 L.Ed. 12. One would have to be blind to history to assert that trade unionism did not enhance and strengthen the right to work. See Webb, History of Trade Unionism; Gregory, Labor and the Law. To require, rather than to induce, the beneficiaries of trade unionism to contribute to its costs may not be the wisest course. But Congress might well believe that it would help insure the right to work in and along the arteries of interstate commerce. No more has been attempted here. The only conditions to union membership authorized by § 2, Eleventh of the Railway Labor Act are the payment of 'periodic dues, initiation fees, and assessments.' The assessments that may be lawfully imposed do not include 'fines and penalties.' The financial support required relates, therefore, to the work of the union in the realm of collective bargaining. No more precise allocation of union overhead to individual members seems to us to be necessary. The prohibition of 'fines and penalties' precludes the imposition of financial burdens for disciplinary purposes. If 'assessments' are in fact imposed for purposes not germane to collective bargaining,7 a different problem would be presented.
14
Wide-ranged problems are tendered under the First Amendment. It is argued that the union shop agreement forces men into idelogical and political associations which violate their right to freedom of conscience, freedom of association, and freedom of thought protected by the Bill of Rights.8 It is said that once a man becomes a member of these unions he is subject to vast disciplinary control9 and that by force of the federal Act unions now can make him conform to their ideology.
15
On the present record, there is no more an infringement or impairment of First Amendment rights than there would be in the case of a lawyer who by state law is required to be a member of an integrated bar. It is argued that compulsory membership will be used to impair freedom of expression. But that problem is not presented by this record. Congress endeavored to safeguard against that possibility by making explicit that no conditions to membership may be imposed except as respects 'periodic dues, initiation fees, and assessments.' If other conditions are in fact imposed, or if the exaction of dues, initiation fees, or assessments is used as a cover for forcing ideological conformity or other action in contravention of the First Amendment, this judgment will not prejudice the decision in that case. For we pass narrowly on § 2, Eleventh of the Railway Labor Act. We only hold that the requirement for financial support of the collective-bargaining agency by all who receive the benefits of its work is within the power of Congress under the Commerce Clause and does not violate either the First or the Fifth Amendments. We express no opinion on the use of other conditions to secure or maintain membership in a labor organization operating under a union or closed shop agreement.
16
Reversed.
17
Mr. Justice FRANKFURTER, concurring.
18
The provision of law now challenged is the latest exercise by Congress of its power under the Commerce Clause to promote peaceful industrial relations in the functioning of interstate railroads and thereby to further the national well-being. A mere recital of the course of history in this important field goes a long way to indicate that the main point of attack against the Act of January 10, 1951, 64 Stat. 1238, raises questions not of constitutional validity but of policy in a domain of legislation peculiarly open to conflicting views of policy. These efforts constitute a body of empiric responses by Congress to new problems or new insight for dealing with old problems.
19
The course of legislation affecting industrial controversies on railroads flows through these statutes: the Act of October 1, 1888, 25 Stat. 501; the Erdman Act of June 1, 1898, 30 Stat. 424, growing out of the Pullman strike of 1894, see In re Debs, 158 U.S. 564, 15 S.Ct. 900, 39 L.Ed. 1092; the Newlands Act of July 15, 1913, 38 Stat. 103; the Adamson Law of September 3, 1916, 39 Stat. 721; Title III of the Transportation Act of 1920, 41 Stat. 456, 469; the Railway Labor Act of May 20, 1926, 44 Stat. 577; the Act of June 21, 1934, 48 Stat. 1185, amending the Railway Labor Act.
20
Nearly fifty years ago, the railroads successfully attacked the constitutionality of a vital feature of the Act of June 1, 1898, whereby Congress made it a criminal offense to bar employment in interstate railroads merely because of labor union membership. Adair v. United States, 1908, 208 U.S. 161, 28 S.Ct. 277, 52 L.Ed. 436. It is fair to say that this decision marks the nadir of denial to Congress of the power to regulate the conditions for assuring the Nation's dependence on the peaceful and effective operation of its railroads. The criticisms that the case aroused, see, e.g., Richard Olney, Discrimination Against Union Labor—Legal?' 42 Amer.L.Rev. 161 (1908), and Roscoe Pound, Liberty of Contract, 18 Yale L.J. 454 (1909), were reflected in later decisions of the Court. Neither the Commerce Clause nor the Due Process Clause was thereafter conceived, at least so far as they restrain railroad labor regulation, to be confined within such doctrinaire and frozen bounds as were confined the assumptions which underlay the decision in the Adair case. Thus, the Court sustained the Adamson Law, which was enacted to avert the threatened nation-wide railroad strike of 1916, Wilson v. New, 1917, 243 U.S. 332, 37 S.Ct. 298, 61 L.Ed. 755; Title III of the Transportation Act of 1920, Pennsylvania R. Co. v. United States Railroad Labor Board, 1923, 261 U.S. 72, 43 S.Ct. 278, 67 L.Ed. 536, and the Railway Labor Act of 1926, Texas & New Orleans R. Co. v. Brotherhood of Railway & Steamship Clerks, 1930, 281 U.S. 548, 50 S.Ct. 427, 74 L.Ed. 1034; but see Railroad Retirement Board v. Alton R. Co., 1935, 295 U.S. 330, 55 S.Ct. 758, 79 L.Ed. 1468.
21
The change in the Court's understanding of industrial problems, certainly as they affect railroads, in their bearing upon the country's commerce and all that thereby hangs, to no small degree reflected the changed attitude of the railroads towards the role of railroad labor unions in the discharge of the functions of railroads. As striking evidence as any of this important shift in opinion is the fact that the Railway Labor Act of 1926 came on the statute books through agreement between the railroads and the railroad unions on the need for such legislation. It is accurate to say that the railroads and the railroad unions between them wrote the Railway Labor Act of 1926 and Congress formally enacted their agreement. I doubt whether there is another instance in the history of important legislation in which acknowledgment was so candidly made by a President of the United States that agreement reached between industrial disputants regarding legislation appropriate for securing their peaceful relations should become law. 'I am informed,' the President reported to Congress in his annual message of December 8, 1925, 'that the railroad managers and their employees have reached a substantial agreement as to what legislation is necessary to regulate and improve their relationship. Whenever they bring forward such proposals, which seem sufficient also to protect the interests of the public, they should be enacted into law.' H.R.Doc. No. 2, 69th Cong., 1st Sess., p. 18. The President was Calvin Coolidge.
22
We have come full circle from the point of view in the Adair case. There the railroads, to repeat, successfully resisted an Act of Congress which outlawed what colloquially became known as the 'yellow-dog contract.' We are now asked to declare it beyond the power of Congress to authorize railroads to enter into voluntary agreements with the unions to which the overwhelming proportion of railway employees belong whereby all their workers are required to belong to such unions, provided, of course, that the unions be open unions, i.e., that membership in the unions be available on ordinary, appropriate terms. It seems to me that the constitutional objections to this legislation were conclusively and compendiously answered by Mr. Justice Holmes in his dissent in Adair v. United States, supra:
23
'Where there is, or generally is believed to be, an important ground of public policy for restraint, the Constitution does not forbid it, whether this court agrees or disagrees with the policy pursued. It cannot be doubted that to prevent strikes, and, so far as possible, to foster its scheme of arbitration, might be deemed by Congress an important point of policy, and I think it impossible to say that Congress might not reasonably think that the provision in question would help a great deal to carry its policy along. But suppose the only effect really were to tend to bring about the complete unionizing of such railroad laborers as Congress can deal with, I think that object alone would justify the act. I quite agree that the question what and how much good labor unions do, is one on which intelligent people may differ; I think that laboring men sometimes attribute to them advantages, as many attribute to combinations of capital disadvantages, that really are due to economic conditions of a far wider and deeper kind; but I could not pronounce it unwarranted if Congress should decide that to foster a strong union was for the best interest, not only of the men, but of the railroads and the country at large.' 208 U.S. at pages 191—192, 28 S.Ct. at page 287.
24
The Court has put to one side situations not now before us for which the protection of the First Amendment was earnestly urged at the bar. I, too, leave them to one side.
1
This constitutional provision is implemented by Neb.Rev.Stat.1943, § 48—217, which provides:
'Labor organizations; no denial of employment; closed shop not permitted. To make operative the provisions of Sections 13, 14 and 15 of Article 15 of the Constitution of Nebraska, no person shall be denied employment because of membership in or affiliation with, or resignation or expulsion from a labor organization or because of refusal to join or affiliate with a labor organization; nor shall any individual or corporation or association of any kind enter into any contract, written or oral, to exclude persons from employment because of membership in or nonmembership in a labor organization.'
2
Section 2, Eleventh reads as follows:
'Eleventh. Notwithstanding any other provisions of this Act, or of any other statute or law of the United States, or Territory thereof, or of any State, any carrier or carriers as defined in this Act and a labor organization or labor organizations duly designated and authorized to represent employees in accordance with the requirements of this Act shall be permitted—
'(a) to make agreements, requiring, as a condition of continued employment, that within sixty days following the beginning of such employment, or the effective date of such agreements, whichever is the later, all employees shall become members of the labor organization representing their craft or class: Provided, That no such agreement shall require such condition of employment with respect to employees to whom membership is not available upon the same terms and conditions as are generally applicable to any other member or with respect to employees to whom membership was denied or terminated for any reason other than the failure of the employee to tender the periodic dues, initiation fees, and assessments (not including fines and penalties) uniformly required as a condition of acquiring or retaining membership.
'(b) to make agreements providing for the deduction by such carrier or carriers from the wages of its or their employees in a craft or class and payment to the labor organization representing the craft or class of such employees, of any periodic dues, initiation fees, and assessments (not including fines and penalties) uniformly required as a condition of acquiring or retaining membership: Provided, That no such agreement shall be effective with respect to any individual employee until he shall have furnished the employer with a written assignment to the labor organization of such membership dues, initiation fees, and assessments, which shall be revocable in writing after the expiration of one year or upon the termination date of the applicable collective agreement, whichever occurs sooner.
'(c) The requirement of membership in a labor organization in an agreement made pursuant to subparagraph (a) shall be satisfied, as to both a present or future employee in engine, train, yard, or
hostling service, that is, an employee engaged in any of the services or capacities covered in section 3, First (h) of this Act defining the jurisdictional scope of the First Division of the National Railroad Adjustment Board, if said employee shall hold or acquire membership in any one of the labor organizations, national in scope, organized in accordance with this Act and admitting to membership employees of a craft or class in any of said services; and no agreement made pursuant to subparagraph (b) shall provide for deductions from his wages for periodic dues, initiation fees, or assessments payable to any labor organization other than that in which he holds membership: Provided, however, That as to an employee in any of said services on a particular carrier at the effective date of any such agreement on a carrier, who is not a member of any one of the labor organizations, national in scope, organized in accordance with this Act and admitting to membership employees of a craft or class in any of said services, such employee, as a condition of continuing his employment, may be required to become a member of the organization representing the craft in which he is employed on the effective date of the first agreement applicable to him: Provided, further, That nothing herein or in any such agreement or agreements shall prevent an employee from changing membership from one organization to another organization admitting to membership employees of a craft or class in any of said services.
'(d) Any provisions in paragraphs Fourth and Fifth of section 2 of this Act, in conflict herewith are to the extent of such conflict amended.'
3
The union shop is a variant of the closed shop, since union membership is required of every employee after the 60-day period designated in the Act.
In 1954 the Bureau of Labor Statistics made an analysis of 1,716 collective-bargaining agreements in effect in industries not regulated by the Railway Labor Act. Of the 7,405,000 workers covered by the agreements studied, 64% were employed under union shop provisions. 78 Monthly Labor Review, No. 6, 649.
4
Once courts enforce the agreement the sanction of government is, of course, put behind them. See Shelley v. Kraemer, 334 U.S. 1, 68 S.Ct. 836, 92 L.Ed. 1161; Hurd v. Hodge, 334 U.S. 24, 68 S.Ct. 847, 92 L.Ed. 1187; Barrows v. Jackson, 346 U.S. 249, 73 S.Ct. 1031, 97 L.Ed. 1586.
5
The parallel provision in § 14(b) of the Taft-Hartley Act, 61 Stat. 151, 29 U.S.C. § 164(b), 29 U.S.C.A. § 164(b), makes the union shop agreement give way before a state law prohibiting it.
6
See Mason, Brandeis, A Free Man's Life (1946), pp. 303 304, which quotes a letter of February 26, 1912, from Brandeis to Lincoln Steffens:
'* * * But the American people should not, and will not, accept unionism if it involves the closed shop. They will not consent to the exchange of the tyranny of the employer for the tyranny of the employee. Unionism therefore cannot make a great advance until it abandons the closed shop; and it cannot accept the open shop as an alternative. The open shop means the destruction of the union.
'The advance of unionism demands therefore some relation between the employer and the employee other than either the closed or open shop, and I feel confident that we have found a solution in the preferential union shop.'
7
A number of appellant unions have broad powers to levy assessments for unspecified purposes. For example, the bylaws of the Railroad Yardmasters of America authorize the Executive Board to 'levy assessments upon all the members affected when in its opinion such assessments are necessary.' § 26. And § 27 provides: 'Local lodges may levy such assessments upon their respective memberships as may be found necessary * * *.' The General Committee of a Subordinate Division of the Order of Railroad Telegraphers is authorized 'to levy such assessments upon the members employed upon the transportation company over which it has jurisdiction as may be necessary to carry on its work.' Subordinate Division Statutes, § 42(H). And see Constitution of the Brotherhood of Railroad Signalmen of America, Art. I, § 6; Constitution of the American Railway Supervisors Association, Art. XVI, § 7.
8
The constitutions and bylaws of several appellant unions place restrictions on the individual members.
A. Some disqualify persons from membership for their political views and associations. Art. XIII, § 4, of the Constitution of the Brotherhood of Maintenance of Way Employes bars from membership anyone who is a member of the Communist Party. Another constitution renders ineligible for membership any person who is 'a member of the Communist Party or of any other subversive group, or who subscribes to the doctrines of any such groups.' Subordinate Lodge Constitution of the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers of America, Art. VI, § 1. And see Subordinate Lodge Constitution of the Brotherhood Railway Carmen of America, § 6(a). Art. 16, § 1(a), of the Constitution of the Sheet Metal Workers' International Association provides: 'No member of the communist party or any person who advocates the objective thereof, and no person who belongs to or supports the policies of any other organization or group which advocates the overthrow of the United States government or the government of the Dominion of Canada by force shall be eligible' for membership.
The constitution of one of appellant unions provides that no person shall be eligible for union office 'if such person associates himself with Communist, Fascist or similar organizations, or the Ku Klux Klan, or Columbians. Such eligibility shall likewise be denied where a person associates himself with, lends support or subscribes to the subversive doctrines of the organizations enumerated herein, similar organizations, or any organization or group that expounds or promotes any doctrine or philosophy inimical or subversive to the fundamental purposes of the constitution of the Government of the United States.' Constitution of the Hotel & Restaurant Employees and Bartenders International Union, Art. XI, § 18. The Constitution of the International Association of Machinists, Art. I, § 5, provides: 'A member who advocates or encourages communism, fascism,
nazism, or any other totalitarian philosophy, or who, by other actions, gives support to these 'philosophies' or 'isms' is not eligible to hold office in the I.A.M.'
B. The Grand Lodge Constitution of the Brotherhood Railway Carmen of America prohibits members from 'interfering with legislative matters affecting national, state, territorial, dominion or provincial legislation, adversely affecting the interests of our members.' § 64.
The Constitution of the International Brotherhood of Electrical Workers, another of the appellant unions, forbids any member from 'creating or attempting to create dissatisfaction or dissension among any of the members or among L. U.'s (Local Unions) of the I.B.E.W.' Art. XXVII, § 2(8). The same article and section further prohibits any member from
'(15) Attending or participating in any gathering or meeting whatsoever, held outside meetings of a L.U., at which the affairs of the L.U. are discussed, or at which conclusions are arrived at regarding the business and the affairs of a L.U., or regarding L.U. officers or a candidate or candidates for L.U. office.
'(16) Mailing, handing out, or posting cards, handbills, letters, marked ballots or political literature of any kind, or displaying streamers, banners, signs or anything else of a political nature, or being a party in any way to such being done in an effort to induce members to vote for or against any candidate or candidates for L.U. office, or candidates to cnventions.' And see Art. 17, § 1(b), Constitution of the Sheet Metal Workers' International Association; Art. XXIV, § 2, Constitution of the International Association of Machinists.
C. A number of the constitutions of appellant unions provide for the use of compulsory dues and assessments to finance union insurance and death benefit plans. See, e.g., Constitution of the International Brotherhood of Firemen and Oilers, Art. I, § 22; Constitution of the Railroad Yardmasters of America, Art. VII, § 4; Constitution of the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers of America, Art. VII, § 2.
9
See Summers, Disciplinary Powers of Unions (1950), 3 Ind. & Lab.Rel.Rev. 483; Summers, Disciplinary Procedures of Unions (1950), 4 Ind. & Lab.Rel.Rev. 15; Summers, Legal Limitations on Union Discipline (1951), 64 Harv.L.Rev. 1049; Aaron & Komaroff, Statutory Regulation of Internal Union Affairs (1949), 44 Ill.L.Rev. 425, 631; Wirtz, Government by Private Groups (1953), 13 La.L.Rev. 440; Williams, The Political Liberties of Labor Union Members (1954), 32 Tex.L.Rev. 826.
| 67
|
351 U.S. 243
76 S.Ct. 800
100 L.Ed. 1142
COMMISSIONER OF INTERNAL REVENUE, Petitioner,v.Philip J. LO BUE.
No. 373.
Argued March 6, 1956.
Decided May 28, 1956.
Mr.Philip Elman, Washington, D.C., for petitioner.
Mr. Richard F. Barrett, New York City, for respondent.
Mr. Justice BLACK delivered the opinion of the Court.
1
This case involves the federal income tax liability of respondent LoBue for the years 1946 and 1947. From 1941 to 1947 LoBue was manager of the New York Sales Division of the Michigan Chemical Corporation, a producer and distributor of chemical supplies. In 1944 the company adopted a stock option plan making 10,000 shares of its common stock available for distribution to key employees at $5 per share over a 3-year period. LoBue and a number of other employees were notified that they had been tentatively chosen to be recipients of nontransferable stock options contingent upon their continued employment. LoBue's notice told him: 'You may be assigned a greater or less amount of stock based entirely upon your individual results and that of the entire organization.' About 6 months later he was notified that he had been definitely awarded an option to buy 150 shares of stock in recognition of his 'contribution and efforts in making the operation of the Company successful.' As to future allotments he was told 'It is up to you to justify your participation in the plan during the next two years.' LoBue's work was so satisfactory that the company in the course of 3 years delivered to him 3 stock options covering 340 shares. He exercised all these $5 per share options in 1946 and in 1947,1 paying the company only $1,700 for stock having a market value when delivered of $9,930. Thus, at the end of these transactions, LoBue's employer was worth $8,230 less to its stockholders and LoBue was worth $8,230 more than before.2 The company deducted this sum as an expense in its 1946 and 1947 tax returns but LoBue did not report any part of it as income. Viewing the gain to LoBue as compensation for personal services the Commissioner levied a deficiency assessment against him, relying on § 22(a) of the Internal Revenue Code of 1939, 53 Stat. 9, as amended, 53 Stat. 574, 26 U.S.C.A. § 22(a), which defines gross income as including 'gains, profits, and income derived from * * * compensation for personal service * * * of whatever kind and in whatever form paid * * *.'
2
LoBue petitioned the Tax Court to redetermine the deficiency, urging that 'The said options were not intended by the Corporation or the petitioner to constitute additional compensation but were granted to permit the petitioner to acquire a proprietary interest in the Corporation and to provide him with the interest in the successful operation of the Corporation deriving from an ownership interest.' The Tax Court held that LoBue had a taxable gain if the options were intended as compensation but not if the options were designed to provide him with 'a proprietary interest in the business.' Finding after hearings that the options were granted to give LoBue 'a proprietary interest in the corporation, and not as compensation for services' the Tax Court held for LoBue. 22 T.C. 440, 443. Relying on this finding the Court of Appeals affirmed, saying: 'This was a factual issue which it was the peculiar responsibility of the Tax Court to resolve. From our examination of the evidence we cannot say that its finding was clearly erroneous.' 3 Cir., 223 F.2d 367, 371. Disputes over the taxability of stock option transactions such as this are longstanding.3 We granted certiorari to consider whether the Tax Court and the Court of Appeals had given § 22(a) too narrow an interpretation. 350 U.S. 893, 76 S.Ct. 151.
3
We have repeatedly held that in defining 'gross income' as broadly as it did in § 22(a) Congress intended to 'tax all gains except those specifically exempted.' See, e.g., Commissioner of Internal Revenue v. Glenshaw Glass Co., 348 U.S. 426, 429—430, 75 S.Ct. 473, 476, 99 L.Ed. 483. The only exemption Congress provided from this very comprehensive definition of taxable income that could possibly have application here is the gift exemption of § 22(b)(3). But there was not the slightest indication of the kind of detached and disinterested generosity which might evidence a 'gift' in the statutory sense. These transfers of stock bore none of the earmarks of a gift. They were made by a company engaged in operating a business for profit, and the Tax Court found that the stock option plan was designed to achieve more profitable operations by providing the employees 'with in incentive to promote the growth of the company by permitting them to participate in its success.' 22 T.C. at page 445. Under these circumstances the Tax Court and the Court of Appeals properly refrained from treating this transfer as a gift. The company was not giving something away for nothing.4
4
Since the employer's transfer of stock to its employee LoBue for much less than the stock's value was not a gift, it seems impossible to say that it was not compensation. The Tax Court held there was no taxable income, however, on the ground that one purpose of the employer was to confer a 'proprietary interest.'5 But there is not a word in § 22(a) which indicates that its broad coverage should be narrowed because of an employer's intention to enlist more efficient service from his employees by making them part proprietors of his business. In our view there is not statutory basis for the test established by the courts below. When assets are transferred by an employer to an employee to secure better services they are plainly compensation. It makes no difference that the compensation is paid in stock rather than in money. Section 22(a) taxes income derived from compensation 'in whatever form paid.' And in another stock option case we said that § 22(a) 'is broad enough to include in taxable income any economic or financial benefit conferred on the employee as compensation, whatever the form or mode by which it is effected.' Commissioner of Internal Revenue v. Smith, 324 U.S. 177, 181, 65 S.Ct. 591, 593, 89 L.Ed. 830. LoBue received a very substantial economic and financial benefit from his employer prompted by the employer's desire to get better work from him. This is 'compensation for personal service' within the meaning of § 22(a).
5
LoBue nonetheless argues that we should treat this transaction as a mere purchase of a proprietary interest on which no taxable gain was 'realized' in the year of purchase. It is true that our taxing system has ordinarily treated an arm's length purchase of property even at a bargain price as giving rise to no taxable gain in the year of purchase. See Palmer v. Commissioner of Internal Revenue, 302 U.S. 63, 69, 58 S.Ct. 67, 69, 82 L.Ed. 50. But that is not to say that when a transfer which is in reality compensation is given the form of a purchase the Government cannot tax the gain under § 22(a). The transaction here was unlike a mere purchase. It was not an arm's length transaction between strangers. Instead it was an arrangement by which an employer transferred valuable property to his employees in recognition of their services. We hold that LoBue realized taxable gain when he purchased the stock.6
6
A question remains as to the time when the gain on the shares should be measured. LoBue gave his employer promissory notes for the option price of the first 300 shares but the shares were not delivered until the notes were paid in cash.7 The market value of the shares was lower when the notes were given than when the cash was paid. The Commissioner measured the taxable gain by the market value of the shares when the cash was paid. LoBue contends that this was wrong, and that the gain should be measured either when the options were granted or when the notes were given.
7
It is of course possible for the recipient of a stock option to realize an immediate taxable gain. See Commissioner of Interal Revenue v. Smith, 324 U.S. 177, 181—182, 65 S.Ct. 591, 593, 89 L.Ed. 830. The option might have a readily ascertainable market value and the recipient might be free to sell his option. But this is not such a case. These three options were not transferable8 and LoBue's right to buy stock under them was contingent upon his remaining an employee of the company until they were exercised. Moreover, the uniform Treasury practice since 1923 has been to measure the compensation to employees given stock options subject to contingencies of this sort by the difference between the option price and the market value of the shares at the time the option is exercised.9 We relied in part upon this practice in Commissioner of Internal Revenue v. Smith, 324 U.S. 177, 65 S.Ct. 591, 89 L.Ed. 830; Id., 324 U.S. 695, 65 S.Ct. 891, 89 L.Ed. 1295. And in its 1950 Act affording limited tax benefits for 'restricted stock option plans' Congress adopted the same kind of standard for measurement of gains. § 130A, Internal Revenue Code of 1939, 64 Stat. 942. And see § 421, Internal as amended, 64 Stat. 942. And see § 421, Internal Revenue Code of 1954, 68A Stat. 142. Under these circumstances there is no reason for departing from the Treasury practice. The taxable gain to LoBue should be measured as of the time the options were exercised and not the time they were granted.
8
It is possible that a bona fide delivery of a binding promissory note could mark the completion of the stock purchase and that gain should be measured as of that date. Since neither the Tax Court nor the Court of Appeals passed on this question the judgment is reversed and the case is remanded to the Court of Appeals with instructions to remand the case to the Tax Court for further proceedings.
9
Reversed and remanded.
10
Mr. Justice FRANKFURTER and Mr. Justice CLARK, concurring.
11
We join in the judgment of the Court and in its opinion on the main issue. However, the time when LoBue acquired the interest on which he is taxed was not in issue either before the Tax Court or the Court of Appeals. In the circumstances of this case, there certainly is no reason for departing fron the general rule whereby this Court abstains from passing on such an issue in a tax case when raised here for the first time. See Helvering v. Minnesota Tea Co., 296 U.S. 378, 380, 56 S.Ct. 269, 270, 80 L.Ed. 284; Helvering v. Tex-Penn Co., 300 U.S. 481, 498, 57 S.Ct. 569, 577, 81 L.Ed. 755.
12
Mr. Justice HARLAN, who Mr. Justice BURTON joins, concurring in part and dissenting in part.
13
In my view, the taxable event was the grant of each option, not its exercise. When the respondent received an unconditional option to buy stock at less than the market price, he received an asset of substantial and immediately realizable value, at least equal to the then-existing spread between the option price and the market price. It was at that time that the corporation conferred a benefit upon him. At the exercise of the option, the corporation 'gave' the respondent nothing; it simply satisfied a previously-created legal obligation. That transaction, by which the respondent merely converted his asset from an option into stock, should be of no consequence for tax purposes. The option should be taxable as income when given, and any subsequent gain through appreciation of the stock, whether realized by sale of the option. if transferable, or by sale of the stock acquired by its exercise, is attributable to the sale of a capital asset and, if the other requirements are satisfied, sould be taxed as a capital gain.1 Any other result makes the division of the total gains between ordinary income (compensation) and capital gain (sale of an asset) dependent solely upon the fortuitous circumstance of when the employee exercises his option.2
14
The last two options granted to respondent were unconditional and immediately exercisable, and thus present no further problems. The first option, however, was granted under somewhat different circumstances. Respondent was notified in January 1945 that 150 shares had been 'allotted' to him, but he was given no right to purchase them until June 30, 1945, and his right to do so then was expressly made contingent upon his still being employed at that date. His right to purchase the first allotment of stock was thus not vested until he satisfied the stated condition, and it was not until then that he could be said to have received income, the measure of which should be the value of the option on that date.
15
Accordingly, while I concur in the reversal of the judgment below and in the remand to the Tax Court, I would hold the granting of the options to be the taxable events and would measure the income by the value of the options when granted.
1
There may be some question as to whether the first option was exercised in 1945 or 1946. See the discussion, infra, as to when the transactions were completed.
2
The Commissioner assessed a deficiency on the basis of $8,680 although the record figures show a difference between option price and market value of $8,230. No explanation for the discrepancy appears in the record.
3
See, e.g., Durkee v. Welch, D.C., 49 F.2d 339; Erskine v. Commissioner of Internal Revenue, 26 B.T.A. 147; Geeseman v. Commissioner of Internal Revenue, 38 B.T.A. 258; Evans v. Commissioner of Internal Revenue, 38 B.T.A. 1406. See also Miller, The Treasury's Proposal to Tax Employee's Bargain Purchases, 56 Yale L.J. 706; Note, 64 Yale L.J. 269; 93 Cong.Rec. A4060—A4066; Surrey and Warren, Federal Income Taxation (1955 ed.), 653—674.
4
Robertson v. United States, 343 U.S. 711, 713—714, 72 S.Ct. 994, 996—997, 96 L.Ed. 1237; Bogardus v. Commissioner of Internal Revenue, 302 U.S. 34, 58 S.Ct. 61, 82 L.Ed. 32.
5
The Tax Court noted 'that in practically all such cases as the one before us, both the element of additional compensation and the granting of a proprietary interest are Present.' 22 T.C. at page 445. See also Geeseman v. Commissioner of Internal Revenue, 38 B.T.A. 258, 263.
6
Since our view of the statute requires taxation of gain here it is unnecessary for us to rely on the Treasury Regulations to reach that conclusion. Apparently the present regulations were not applicable to all of the options. See 26 CFR, Rev. 1953, § 39.22(a)—1(c); 1939—1 Cum.Bull. 159; 1946—1 Cum.Bull. 15—18. And since the transactions in question here occurred prior to 1950 the 1950 statute establishing special tax treatment for 'restricted stock option plans' has no relevance. See § 130A, Internal Revenue Code of 1939, as amended, 64 Stat. 942, 26 U.S.C.A. § 130A. And see § 421, Internal Revenue Code of 1954, 68A Stat. 142, 26 U.S.C.A. § 421.
7
LoBue paid cash for the last 40 shares.
8
Cf. McNamara v. Commissioner of Internal Revenue, 7 Cir., 210 F.2d 505.
9
See 1923 II—1 Cum.Bull. 50; 1939—1 Cum.Bull. 159; 1946—1 Cum.Bull. 15—18; Dillavon, Employee Stock Options, 20 Accounting Review 320; Miller, The Treasury's Proposal to Tax Employee's Bargain Purchases, 56 Yale L.J. 706, 713—715. See also Note, The Valuation of Option Stock Subject to Repurchase Options and Restraints on Sales, 62 Yale L.J. 832; Note, Tax Effects of Absence of Market Value on Employee Bargain Purchases, 21 U. of Chi.L.Rev. 464.
1
Commissioner of Internal Revenue v. Smith, 324 U.S. 177, 65 S.Ct. 591, 89 L.Ed. 830; Id., 324 U.S. 695, 65 S.Ct. 891, 89 L.Ed. 1295, does not require an opposite result. In that case Smith's employer, Western, had undertaken the management of a reorganized corporation, Hawley, under a contract by which Western was to receive as compensation for its managerial services a specified amount of stock in Hawley if it was successful in reducing Hawley's indebtedness by a stated amount. Western, in turn, gave Smith, who was active in the Hawley reorganization, an option to buy, at the then-existing market price, a fixed share of any Hawley stock received under the management contract. The management contract was successfully performed, and a part of the Hawley stock received by Western—the value of which was of course substantially enhanced by the performance of the contract—was sold to Smith at the option price. Under the peculiar facts of that case—more analogous to an assignment to an employee of a share in the anticipated proceeds of a contract than to the usual employee stock option plan—the Tax Court's finding that the gain that would accrue to Smith upon the successful performance of the management contract was intended as 'compensation' to him for his services was no doubt amply justified. But as the Court expressly stated in upholding that finding: 'It of course does not follow that in other circumstances not here present the option itself, rather than the proceeds of its exercise, could not be found to be the only intended compensation.' Id., 324 U.S. at page 182, 65 S.Ct. at page 593.
2
Suppose two employees are given unconditional options to buy stock at $5, the current market value. The first exercises the option immediately and sells the stock a year later at $15. The second holds the option for a year, exercises it, and sells the stock immediately at $15. Admittedly the $10 gain would be taxed to the first as capital gain; under the Court's view, it would be taxed to the second as ordinary income because it is 'compensation' for services. I fail to see how the gain can be any more 'compensation' to one than it is to the other.
| 1112
|
351 U.S. 253
76 S.Ct. 814
100 L.Ed. 1151
OFFUTT HOUSING COMPANY, a Corporation, Petitioner,v.COUNTY OF SARPY and Robert M. Eby, Treasurer of the County of Sarpy, NEBRASKA.
No. 404.
Argued April 26, 30, 1956.
Decided May 28, 1956.
Mr. Robert L. Stern, Chicago, Ill., for petitioner.
Messrs. Dixon G. Adams and Orville Entenman, Papillion Neb., for respondents.
Mr. Justice FRANKFURTER delivered the opinion of the Court.
1
This suit was brought by petitioner against respondent county and its treasurer for a declaratory judgment that petitioner was not required to pay certain state and county 'personal property' taxes and for an injunction against the levy of such taxes on that property. The controlling facts are not in dispute. Petitioner is a Nebraska corporation organized primarily to provide housing for rent or sale. On January 18, 1951, petitioner entered into a contract with the Secretary of the Air Force to lease 63 acres of land and to build a housing project on Offutt Air Force Base in respondent county in accordance with specifications submitted to the Department of the Air Force and to be approved by the Federal Housing Commissioner.
2
The lease was for 75 years at a rental price of $100 per year. It provided that the 'buildings and improvements erected by the Lessee, constituting the aforesaid housing project, shall be and become, as completed, real estate and part of the leased land, and public buildings of the United States, leased to Lessee * * *' and further provided that 'upon the expiration of this lease, or earlier termination, all improvements made upon the leased premises shall remain the property of the Government without compensation * * *.' Petitioner was to lease all the units of the project to such military and civilian personnel at the Base as were designated by the Commanding Officer, on terms specified in the contract and at a maximum rent approved by the Federal Housing Administration and the Air Force. The Government was to provide fire and police protection to the project on a reimbursable basis. Petitioner had the right to permit public utilities to extend water, gas, sewer, telephone, and electric power lines onto the leased land in order to provide those services. Petitioner agreed to insure the buildings at its own expense, to permit Government inspection of the premises, and to comply with regulations prescribed by the Commanding Officer for military requirements for safety and security purposes, consistent with the use of the leased land for housing. Petitioner could not assign the lease without the written approval of the Secretary of the Air Force.
3
The preferred stock of petitioner was held by the Commissioner of the Federal Housing Administration which, acting under Title VIII of the National Housing Act (the Wherry Military Housing Act), 63 Stat. 570, 12 U.S.C.A. § 1748 et seq., insured a mortgage on the project after receiving a certificate from the Department of the Air Force that a housing project was necessary to provide adequate housing for civilian or military personnel. After the singing of the contract and the insurance of the mortgage, construction proceeded forthwith. Petitioner filed no county tax return, although the Attorney General of Nebraska had ruled that its interest in the project, including all of the 'personal property' used therein, was taxable as 'personal property.' On June 23, 1952, the county assessor of Sarpy County filed a schedule on behalf of petitioner, listing a taxable total of $825,685, itemized as 'Furniture & Fixtures—Tools & Equipment'; 'Household Appliances'; and 'Improvements on Leased Land.' Petitioner never paid the resulting county and state taxes, and after the county treasurer threatened to issue the usual distress warrant to collect the taxes, petitioner brought this suit.
4
The District Court of Sarpy County held that, since title to the buildings and improvements was in the United States, Nebraska and Sarpy County could not tax them. The Supreme Court of Nebraska reversed, holding that Congress had given Nebraska the right to tax petitioner's interest in the property and that for tax purposes, under Neb.Rev.Stat. Reissue 1950, § 77—1209, petitioner was in fact and as a matter of law the owner of the property sought to be taxed. 160 Neb. 320, 70 N.W.2d 382. Petitioner's attack on the Nebraska judgment raises serious questions of state-federal relations with respect to taxation of private housing developments on Government-owned land, and therefore we granted certiorari. 350 U.S. 893, 76 S.Ct. 153.
5
This is another in a long series of cases in this Court dealing with the power of the States to tax property in private hands against a claim of exempt status deriving from an immunity of the Federal Government from state taxation. Offutt Air Force Base falls within the scope of Article I, § 8, cl. 17 of the United States Constitution, providing that the Congress shall have power
6
'To exercise exclusive Legislation in all Cases whatsoever, over such District (of Columbia) * * * and to exercise like Authority over all Places purchased by the Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts, Magazines, Arsenals, dock-Yards, and other needful Buildings * * *.'
7
The course of construction of this provision cannot be said to have run smooth. The power of 'exclusive Legislation' has been held to prohibit a state tax on private property located on a military base acquired pursuant to art. I, § 8, cl. 17. Surplus Trading Co. v. Cook, 281 U.S. 647, 50 S.Ct. 455, 74 L.Ed. 1091. On the other hand, the State may acquire the right to tax private interests within such a location by permission of Congress, see e.g., the Buck Act, 54 Stat. 1059, 4 U.S.C.A. §§ 104—110 (permitting state sales, use, and income taxes), and we have also held that the State may tax when the United States divests itself of proprietary interest over the area on which the tax is sought to be levied. S.R.A., Inc., v. State of Minnesota, 327 U.S. 558, 66 S.Ct. 749, 90 L.Ed. 851; see also Baltimore Shipbuilding & Dry Dock Co., v. City of Baltimore, 195 U.S. 375, 25 S.Ct. 50, 49 L.Ed. 242.
8
The line of least resistance in analysis of our immediate problem is to ascertain whether Congress has given consent to the type of state taxation here asserted. The applicable congressional statutes are the Military Leasing Act of 1947 and the Wherry Military Housing Act of 1949 (adding Title VIII to the National Housing Act). The Military Leasing Act provides:
9
'That whenever the Secretary of War or the Secretary of the Navy shall deem it to be advantageous to the Government he is authorized to lease such real or personal property under the control of his Department as is not surplus to the needs of the Department within the meaning of the Act of October 3, 1944 (58 Stat. 765), and is not for the time required for public use, to such lessee or lessees and upon such terms and conditions as in his judgment will promote the national defense or will be in the public interest. Each such lease shall be for a period not exceeding five years unless the Secretary of the Department concerned shall determine that a longer period will promote the national defense or will be in the public interest. * * * Each such lease shall contain a provision permitting the Secretary of the Department concerned to revoke the lease at any time, unless the Secretary shall determine that the omission of such provision from the lease will promote the national defense or will be in the public interest. In any even each such lease shall be revocable by the Secretary of the Department concerned during a national emergency declared by the President. * * * The authority herein granted shall not apply to oil, mineral, or phosphate lands. * * *
10
'Sec. 6. The lessee's interest, made or created pursuant to the provisions of this Act, shall be made subject to State or local taxation. Any lease of property authorized under the provisions of this Act shall contain a provision that if and to the extent that such property is made taxable by State and local governments by Act of Congress, in such event the terms of such lease shall be renegotiated.' 61 Stat. 774—776, 5 U.S.C.A. §§ 626s—3, 626s—6.
Two years later, the Wherry Act provided:
11
'Whenever the Secretary of the Army, Navy, or Air Force determines that it is desirable to lease real property within the meaning of the Act of August 5, 1947 (61 Stat. 774), to effectuate the purposes of this title, the Secretary concerned is authorized to lease such property under the authority of said Act upon such terms and conditions as in his opinion will best serve the national interest without regard to the limitations imposed by said Act in respect to the term or duration of the lease, and the power vested in the Secretary of the Department concerned to revoke any lease made pursuant to said Act in the event of a national emergency declared by the President shall not apply. * * *' 63 Stat. 570, 576.
12
These two Acts interlock and must be read together. The reasonable relationship between them has been thus delineated by the Court of Appeals for the Third Circuit:
13
'In our view this provision of the National Housing Act (the 1949 Act) merely permits leasing for military housing purposes, already covered by the general authorization of the 1947 Act, to be accomplished without regard to specified restrictions of the 1947 Act, when the elimination of these restrictions would serve the purposes of the Housing Act. Other provisions of the 1947 Act, including the language of Section 6 subjecting the lessee's interest to local taxation, apply to leases made under the authority of both Acts.
14
'We have not overlooked the argument for a narrower view of the scope of the 1947 Act based upon legislative history indicating that the primary purpose of that Act was to provide for the leasing of standby defense plants. But the language of the Act extends the leasing authority to all non-surplus property under the control of the Defense Department except oil, mineral, or phosphate lands (an exception which would be unnecessary if the Act applied only to defense plants). An additional indication that the 1947 Act encompasses the leasing of property generally is found in Section 2 which repeals the prior authority for the leasing of War Department property generally, 27 Stat. 321. The Senate Report expresses the reporting committee's understanding that this prior leasing statute was being 'entirely superseded'. Sen.Rep.No. 626, 1947, 80th Cong.1st Sess. (p. 3).' Fort Dix Apartments Corp. v. Borough of Wrightstown, 225 F.2d 473, 475—476.
15
We agree with this. To be sure, the 1947 Act does not refer specifically to property in an area subject to the power of 'exclusive Legislation' by Congress. It does, however, govern the leasing of Government property generally and its permission to tax extends generally to all lessees' interests created by virtue of the Act. The legislative history indicates a concern about loss of revenue to the States and a desire to prevent unfairness toward competitors of the private interests that might otherwise escape taxation. While the latter consideration is not necessarily applicable where military housing is involved, the former is equally relevant to leases for military housing as for any other purpose.
16
We do not say that this is the only admissible construction of these Acts. We could regard art. I, § 8, cl. 17 as of such overriding and comprehensive scope that consent by Congress to state taxation of obviously valuable private interests located in an area subject to the power of 'exclusive Legislation' is to be found only in explicit and unambiguous legislative enactment. We have not heretofore so regarded it, see S.R.A., Inc., v. State of Minnesota, 327 U.S. 558, 66 S.Ct. 749, 90 L.Ed. 851; Baltimore Shipbuilding & Dry Dock Co. v. City of Baltimore, 195 U.S. 375, 25 S.Ct. 50, 49 L.Ed. 242, nor are we constrained by reason to treat this exercise by Congress of the 'exclusive Legislation' power and the manner of construing it any differently from any other exercise by Congress of that power. This is one of those cases in which Congress has seen fit not to express itself unequivocally. It has preferred to use general language and thereby requires the judiciary to apply this general language to a specific problem. To that end we must resort to whatever aids to interpretation the legislation in its entirety and its history provide. Charged as we are with this function, we have concluded that the more persuasive construction of the statute, however flickering and feeble the light afforded for extracting its meaning, is that the States were to be permitted to tax private interests, like those of this petitioner, in housing projects located on areas subject to the federal power of 'exclusive Legislation.' We do not hold that Congress has relinquished this power over these areas. We hold only that Congress, in the exercise of this power, has permitted such state taxation as is involved in the present case.
17
Petitioner also argues that the state tax, measured by the full value of the buildings and improvements, is not on the 'lessee's interest' but is on the full value of property owned by the Government. Labeling the Government as the 'owner' does not foreclose us from ascertaining the nature of the real interests created and so does not solve the problem. See Millinery Center Building Corp. v. Commissioner, 350 U.S. 456, 76 S.Ct. 493. The lease is for 75 years; the buildings and improvements have an estimated useful life of 35 years. The enjoyment of the entire worth of the buildings and improvements will therefore be petitioner's.
18
Petitioner argues, however, that the Government has a substantial interest in the buildings and improvements, since the Government prescribed the maximum rents and determined the occupants, had voting interests in petitioner, provided services, and took the financial risks by insuring the project. Petitioner compares its own position to that of a 'managing agent.' This characterization is an attempt by use of a phrase to make these facts fit an abstract legal category. This contention would certainly surprise a Congress which was interested in having private enterprise and not the Government conduct these housing projects. The Government may have 'title,' but only a paper title, and, while it retained the controls described in the lease as a regulatory mechanism to prevent the ordinary operation of unbridled economic forces, this does not mean that the value of the buildings and improvements should thereby be partially allocated to it. If an ordinary private housing venture were being assessed for tax purposes, the value would not be allocated between an owner and the mortgage company which does his financing or between the owner and the State, which may fix rents and provide services. In the circumstances of this case, then, the full value of the buildings and improvements is attributable to the lessee's interest.1
19
Petitioner further argues that the tax on the applicances and furniture is invalid because petitioner owns those items, never bought them from the Government, and that therefore its interest was not 'made or created pursuant to the provisions of this Act (the Military Leasing Act of 1947).' Here again using a label, that of 'owner,' as descriptive of petitioner does not answer the question. It appears from the record that petitioner was required to supply the appliances for the housing project. Petitioner and its tenants will have full use of them for the lease period and they or their replacements must be left on the property at the end of the lease. Petitioner's interest in the appliances, just like its interest in the buildings, is determined by its agreement with the Government and, keeping in mind the purpose of § 6, we interpret that section as treating these items alike.2
20
For these reasons the judgment of the Supreme Court of Nebraska must be affirmed.
21
Affirmed.
22
Mr. Justice DOUGLAS, with whom Mr. Justice REED, Mr. Justice BURTON, and Mr. Justice HARLAN concur, dissenting.
23
There are two reasons why I dissent in this case.
24
First. The legislative history of the Wherry Act makes clear that the purpose of the legislation was to encourage military personnel to remain in the Armed Forces by providing clean, adequate, and inexpensive housing for them. H.R.Rep.No.854, 81st Cong., 1st Sess., pp. 2, 4; S.Rep.No.410, 81st Cong., 1st Sess., pp. 2, 4—5. There is nothing to indicate that Congress departed from the established practice, Surplus Trading Co. v. Cook, 281 U.S. 647, 50 S.Ct. 455, 74 L.Ed. 1091, and consented to local taxation on the federal enclaves. Taxation by local authorities of a housing project is one sure way of increasing its cost and hampering the federal program. If that had been intended, I would expect plain language revealing the purpose. The Court finds no plain language but relies only on adumbration and reasoning from elaborate implication. Yet the 'doctrine of sovereign immunity is so embedded in constitutional history and practice that this Court cannot subject the Government or its official agencies to state taxation without a clear congressional mandate.' Kern-Limerick, Inc., v. Scurlock, 347 U.S. 110, 122, 74 S.Ct. 403, 411, 98 L.Ed. 546.
25
To be sure, the Wherry Act and the Military Leasing Act are intertwined and § 6 of the Leasing Act makes the 'lessee's interest' subject to local taxation. But the intertwining of the two Acts is very limited. Section 805 of the Wherry Act authorizes the Secretaries of the Armed Forces to make leases under the authority of the Leasing Act, without regard to the limitations imposed by it as respects the term or duration of the lease. But the authority to lease and the limitations imposed on leases are contained in § 1 of the Leasing Act. Nothing in the language of § 805 requires the balance of the Act to be incorporated. We strain beyond the normal demands of language to pull § 6 of the Leasing Act into the Wherry Act. Section 807 of the Wherry Act deals with taxation. It allows local taxation of real property acquired by the Federal Housing Commissioner. I would suppose that if local taxation is specifically allowed in one instance, the waiver of immunity is limited, not general. We usurp the function of the lawmakers when we hold to the contrary.
26
Second. Even if the Wherry Act be read as including § 6 of the Leasing Act, we should rebel at the application now given it. Section 6 of the Leasing Act, if applicable only subjects the 'lessee's interest' to local taxation. Yet the Court allows the local tax to be placed on the entire value of the property. Its justification apparently is the low annual rental charged by the United States to the lessee, the length of the lease, and the useful life of the buildings and improvements. The 'enjoyment of the entire worth' of the property will be the lessee's, says the Court. The interest of the Federal Government is therefore nominal. For these reasons the 'lessee's interest' is held to include the entire value of the property.1
27
This formalism misses the entire point. The Government's stake here cannot be measured by bare legal title. It has vast and important interests in these projects. It owns the controlling stock in the lessee. It prescribes the maximum rentals. It determines what persons may occupy the living quarters. It assumes most of the financial risks of these housing projects by insuring the mortgagees. It provides police and fire protection, sewerage and water service, and access roads. The United States is not a mere lessor who, having leased the property, allows it to be managed by the lessee. The great decisions as to management are made by the Government. The lessee is, indeed, a managing agent.
28
The lease makes the buildings and improvements property of the United States. That reservation of title may not be challenged here as colorable. See Kern-Limerick, Inc., v. Scurlock, supra, 347 U.S. 116—123, 74 S.Ct. 407, 411, 98 L.Ed. 546. It was made to protect the large interests of the United States in low-cost housing on federal enclaves—a purpose now partially defeated by what we do today. For, once the local taxes are imposed, the rentals to the servicemen rise, unless the United States pays the bill. Ironically, the rents rise without the servicemen receiving more benefits of local government than even transients receive. The tax is a windfall to the local Nebraska authorities as the Federal Government provides the governmental services protective of the property taxed.2
1
The record before us is unclear whether the estimated useful life of all the appliances and furniture is less than the lease period. To the extent that the estimated useful life of any of these items extends beyond the term of the lease, the value attributable to such period must be excluded from the tax, since it represents the Government's ownership interest. In the present state of the record, however, petitioner's remedy, if any, is in the Nebraska courts, not here.
2
The record does not indicate clearly the relationship of the parties with respect to the furniture—valued at $205 in the total 1952 valuation of the taxable property at $825,685. This is a minor matter and we leave petitioner to seek redress in the Nebraska courts, should the interests of the Government and petitioner in the furniture be significantly different from their interests in the appliances or buildings.
1
It is of interest that an effort was made in the Senate Committee on Armed Services to provide in the Leasing Act that when property was leased by the Government the entire value be subject to local taxation. See Hearings, Senate Committee on Armed Services on S. 1198, 80th Cong., 1st Sess., pp. 27—32. But that proposal was rejected by the Senate Committee.
2
Under the Buck Act, 54 Stat. 1059, as amended, 4 U.S.C. §§ 104—110, 4 U.S.C.A. §§ 104—110, residents of military reservations pay state sales, use, income, and gasoline taxes.
| 78
|
351 U.S. 266
76 S.Ct. 794
100 L.Ed. 1162
UNITED AUTOMOBILE, AIRCRAFT AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA, affiliated with the Congress of Industrial Organizations, UAW CIO, Appellant,v.WISCONSIN EMPLOYMENT RELATIONS BOARD and Kohler Co., a Wisconsin Corporation.
No. 530.
Argued April 24, 25, 1956.
Decided June 4, 1956.
Mr.Kurt L. Hanslowe, Detroit, Mich., for appellant.
Mrs. Beatrice Lampert, Madison, Wis., for appellee Wisconsin Employment Relations Board.
Mr. Jerome Powell, Washington, D.C., for appellee Kohler Co.
Mr. Justice REED delivered the opinion of the Court.
1
This case, as stated in the brief for the United Automobile, Aircraft and Agricultural Implement Workers of America, presents the question whether or not a State may enjoin through its labor statute, the Wisconsin Employment Peace Act, St.1953, § 111.01 et seq., union conduct of a kind which may be an unfair labor practice under the National Labor Relations Act, as amended, 29 U.S.C.A. § 151 et seq.1
2
Appellant concedes that a State may punish violence arising in labor relation controversies under its generall applicable criminal statutes. It does not admit or deny the charged violence. The union considers the coercion immaterial in this case. Its position is that a State may not exercise this police power through an agency that is concerned only with labor relations. The argument is that a State Board will use this power to stop force and violence in order to further state labor policy, thus creating a conflict with the federal policy as developed by the National Labor Relations Board. The union argues that Wisconsin has no jurisdiction to enjoin the alleged conduct under its labor act because such conduct would be an unfair labor practice under the National Labor Relations Act.
3
This controversy arose out of the failure of appellant and the Kohler Company to reach an accord concerning a new collective-bargaining agreement. As the parties were unable to agree, Kohler's production workers struck and picketed the premises of the company. Ten days later Kohler filed a complaint with the Wisconsin Employment Relations Board charging appellant and others with committing unfair labor practices within the meaning of the Wisconsin Employment Peace Act.2 It was alleged that appellant's members had engaged in mass picketing, thereby obstructing ingress to and egress from the Kohler plant; interfered with the free and uninterrupted use of public ways; prevented persons desiring to be employed by Kohler from entering the plant; and coerced employees who desired to work, and threatened them and their families with physical injury. The State Board found the allegations to be true and issued an order that directed the union and certain of its members to cease all such activities. The order appears below.3 Without change of substance it was enforced by a Wisconsin Circuit Court, and the State Supreme Court affirmed that judgment. 269 Wis. 578, 70 N.W.2d 191. As the appeal raised an important question of federalism, we noted probable jurisdiction. 350 U.S. 957, 76 S.Ct. 347.4
4
The Kohler Company is subject to the National Labor Relations Act. It seems agreed, and we think correctly in view of the findings of fact, that the alleged conduct of the union in coercing employees in the exercise of their rights is a violation of § 8(b)(1) of that Act.5 Since there is power under the Act to protect employees against violence from labor organizations by assuring their right to refrain from concerted labor activities, the National Labor Board might have issued an order similar to that of the State Board.6 The provisions of the National Labor Relations Act, as amended, cover the labor relations of the Kohler Company. National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U.S. 1, 31, 57 S.Ct. 615, 621, 81 L.Ed. 893. These provisions may be assumed to include the coercion not only of strikers but also of other persons seeking employment with the plant.7
5
By virtue of the Commerce Clause, art. 1, § 8, cl. 3, Congress has power to regulate all labor controversies in or affecting interstate commerce, such as are here involved. If the congressional enactment occupies the field, its control by the Supremacy Clause, art. 6, cl. 2, supersedes or, in the current phrase, preempts state power. Kelly v. State of Washington, 302 U.S. 1, 9, 58 S.Ct. 87, 91, 82 L.Ed. 3. In the 1935 Act, § 10(a), the Board was empowered to prevent unfair labor practices. By § 10(a) this power was made 'exclusive.' 49 Stat. 449, 453, 29 U.S.C.A. § 160. In the Taft-Hartley amendments of 1947, the word 'exclusive' was omitted but the phrase, 'shall not be affected by any other means of adjustment or prevention that has been or may be established by agreement, code, law, or otherwise', was re-enacted without significant change. The omission was explained in the Conference Report.8
6
Yet under the 1935 Wagner Act this Court ruled that Wisconsin, under its same Labor Peace Act, could enjoin union conduct of the kind here involved. Allen-Bradley Local No. 1111, United Electrical Radio and Machine Workers of America v. Wisconsin Employment Relations Board, 315 U.S. 740, 62 S.Ct. 820, 86 L.Ed. 1154. At that time, however, the federal Act made no provision for enjoining union activities. With the passage of the Taft-Hartley Act in 1947, the Congress recognized that labor unions also might commit unfair labor practices to the detriment of employees, and prohibited among other practices, coercion of employees who wish to refrain from striking. See note 5, supra. Appellant urges that this amendment eliminated the State's power to control the activities now under consideration through state labor statutes.
7
It seems obvious that § 8[b][1] was not to be the exclusive method of controlling violence even against employees, much less violence interfering with others approaching an area where a strike was in progress.9 No one suggests that such violence is beyond state criminal power. The Act does not have such regulatory pervasiveness. The state interest in law and order precludes such interpretation. Senator Taft explained that the federal prohibition against union violence would allow state action.10
8
Appellant is of the view that such references were 'to the general state criminal law against violence and coercion, not to state labor relations statutes.' But this cannot be correct since Allen-Bradley Local No. 1111, United Electrical Radio and Machine Workers of America v. Wisconsin Employment Relations Board, the leading case dealing with violence under this same Wisconsin statute, was well known to Congress.11 The fact that the Labor Management Act covered union unfair practices for the first time does not make the Allen-Bradley case obsolete. Orders which originate in state boards and become effective through the state judiciary should give more careful protection to the rights of labor than the purely judicial orders of a court.
9
There is no reason to re-examine the opinions in which this Court has dealt with problems involving federal-state justisdiction over industrial controversies. They have been adequately summarized in Weber v. Anheuser-Busch, Inc., 348 U.S. 468, 474—477, 75 S.Ct. 480, 484—486, 99 L.Ed. 546. As a general matter we have held that a State may not, in the furtherance of its public policy, enjoin conduct 'which has been made an 'unfair labor practice' under the federal statutes.' Id., 348 U.S. at page 475, 75 S.Ct. at page 485, and cases cited. But our post-Taft-Hartley opinions have made it clear that this general rule does not take from the States power to prevent mass picketing, violance, and overt threats of violence.12 The dominant interest of the State in preventing violence and property damage cannot be questioned. It is a matter of genuine local concern. Nor should the fact that a union commits a federal unfair labor practice while engaging in violent conduct prevent States from taking steps to stop the violence. This conclusion has been explicit in the opinions cited in note 12.
10
The States are the natural guardians of the public against violence. It is the local communities that suffer most from the fear and loss occasioned by coercion and destruction. We would not interpret an act of Congress to leave them powerless to avert such emergencies without compelling directions to that effect.
11
We hold that Wisconsin may enjoin the violent union conduct here involved. The fact that Wisconsin has chosen to entrust its power to a labor board is of no concern to this Court.13
12
Affirmed.
13
Mr. Justice DOUGLAS, with whom the CHIEF JUSTICE andMr. Justice BLACK concur, dissenting.
14
There are instances where we have sustained identical regulations of the same act by both a State and the Federal Government. People of State of California v. Zook, 336 U.S. 725, 69 S.Ct. 841, 93 L.Ed. 1005, is an example. But the instances are few and far between.
15
Of course, where the States and the Federal Government regulate the same act, but each with a different sanction, both often survive. United Construction Workers, affiliated with United Mine Workers of America v. Laburnum Const. Corp., 347 U.S. 656, 74 S.Ct. 833, 93 L.Ed. 1025, is a recent example. We there allowed a common-law tort action for damages to be enforced in a state court for the same acts that could have been the basis for administrative relief under the federal Act. But the present case is not that case. Here the State has prescribed an administrative remedy that duplicates the administrative remedy prescribed by Congress. Each reaches the same identical conduct. We disallowed that duplication of remedy in Garner v. Teamsters, etc., Union, 346 U.S. 485, 74 S.Ct. 161, 98 L.Ed. 228. In that case we held that a state court could not enjoin action which was subject to an unfair labor proceeding under the federal Act. And see Weber v. Anheuser-Busch, Inc., 348 U.S. 468, 75 S.Ct. 480, 99 L.Ed. 546. Today we depart from Garner and allow a state board to enjoin action which is subject to an unfair labor proceeding before the federal board. We sanction a precise duplication of remedies which is pregnant with potentialities of clashes and conflicts.*
16
Of course the States may control violence. They may make arrests and invoke their criminal law to the hilt. They transgress only when they allow their administrative agencies or their courts to enjoin the conduct that Congress has authorized the federal agency to enjoin. We retreat from Garner and open the door to unseemly conflicts between state and federal agencies when we sustain what Wisconsin has done here.
1
The question presented is narrowed by appellant in another paragraph to apply only to instances, as here, where the National Board has asserted jurisdiction over certain other labor practices arising from the same employer-union relationship. These proceedings include a plea by the employer that the state-enjoined union conduct constitutes a defense to a union charge filed with the Board. Appellant also asserted that the State should act only after the Board has passed upon the pending union complaint. In view of our disposition of this appeal, we do not consider these narrower issues material.
2
Wisconsin Statutes 1953, c. 111, p. 1903.
§ 111.04, p. 1905:
'111.04 Rights of employes. Employes shall have the right of self-organization and the right to form, join or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in lawful, concerted activities for the purpose of collective bargaining or other mutual aid or protection; and such employes shall also have the right to refrain from any or all of such activities.'
§ 111.06(2), p. 1907:
'(2) It shall be an unfair labor practice for an employe individually or in concert with others:
'(a) To coerce or intimidate an employe in the enjoyment of his legal rights, including those guaranteed in section 111.04, or to intimidate his family, picket his domicile, or injure the person or property of such employe or his family.
'(f) To hinder or prevent, by mass picketing, threats, intimidation, force or coercion of any kind the pursuit of any lawful work or employment, or to obstruct or interfere with entrance to or egress from any place of employment, or to obstruct or interfere with free and uninterrupted use of public roads, streets, highways, railways, airports, or other ways of travel or conveyance.'
§ 111.07, p. 1908:
'111.07 Prevention of unfair labor practices. (1) Any controversy concerning unfair labor practices may be submitted to the board in the manner and with the effect provided in this subchapter, but nothing herein shall prevent the pursuit of legal or equitable relief in courts of competent jurisdiction.'
3
It is ordered that the Respondent Unions, their officers, members and agents immediately cease and desist from
'1. Coercing and intimidating any person desiring to be employed by the Kohler Company in the enjoyment of his legal rights, intimidating his family, picketing his domicile, or injuring the person or property of such persons or his employe.
'2. Hindering or preventing by mass picketing, threats, intimidation, force or coercion of any kind the pursuit of lawful work or employment by any person desirous of being employed by the Kohler Company.
'3. Obstructing or interfering in any way with entrance to and egress from the premises of the Kohler Company.
'4. Obstructing or interfering with the free and uninterrupted use of public roads, streets, highways, railways or private drives leading to the premises of the Kohler Company.
'It is further ordered that the Respondent Unions, their officers, members and agents take the following affirmative action:
'1. Limit the number of pickets around the Kohler Company premises to a total of not more than 200, with not more than 25 at any one entrance. Such pickets are to march in single file and to at all times maintain a space of at least 20 feet in width at each entrance to the Kohler Company premises over which pickets will not pass and on which persons either on foot or in conveyance may freely enter or leave the premises without interference.'
4
The legal problems have received considerable attention in recent years. A collection of available articles appears in Note, 53 Mich.L.Rev. 602. See also Further Comments on Federalism, 54 Mich.L.Rev. 540; Isaacson, Labor Relations Law: Federal versus State Jurisdiction, 42 A.B.A.J. 415.
5
'Sec. 8. * * *
'(b) It shall be an unfair labor practice for a labor organization or its agents—
'(1) to restrain or coerce (A) employees in the exercise of the rights guaranteed in section 7 * * *.' 61 Stat. 136, 141, 29 U.S.C.A. § 158(b)(1).
'Sec. 7. Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities * * *.' 61 Stat. 140, 29 U.S.C.A. § 157.
6
Cf. In the Matter of Local #1150, United Electrical, Radio & Machine Workers, 84 N.L.R.B. 972; In the Matter of Perry Norvell Co., 80 N.L.R.B. 225; United Mine Workers of America, District 2, 96 N.L.R.B. 1389.
7
See Phelps Dodge Corp. v. National Labor Relations Board, 313 U.S. 177, 182, 61 S.Ct. 845, 846, 85 L.Ed. 1271; First. Cf. Labor Board v. Hearst Publications, 322 U.S. 111, 120, I, 64 S.Ct. 851, 855, 88 L.Ed. 1170.
8
H.R.Rep. No. 510, 80th Cong., 1st Sess. 52: Conf.
'(1) The House bill omitted from section 10(a) of the existing law the language providing that the Board's power to deal with unfair labor practices should not be affected by other means of adjustment or prevention, but it retained the language of the present act which makes the Board's jurisdiction exclusive. The Senate amendment, because of its provisions authorizing temporary injunctions enjoining alleged unfair labor practices and because of its provisions making unions suable, omitted the language giving the Board exclusive jurisdiction of unfair labor practices, but retained that which provides that the Board's power shall not be affected by other means of adjustment or prevention. The conference agreement adopts the provisions of the Senate amendment. By retaining the language which provides the Board's powers under section 10 shall not be affected by other means of adjustment, the conference agreement makes clear that, when two remedies exist, one before the Board and one before the courts, the remedy before the Board shall be in saddition to, and not in lieu of, other remedies.'
9
United Construction Workers, Affiliated with United Mine Workers of America v. Laburnum Construction Corp., 347 U.S. 656, 666—669, 74 S.Ct. 833, 838—840, 98 L.Ed. 1025, a state case that allowed tort recovery, makes this clear.
10
93 Cong.Rec. 4437:
'The Senator from Oregon a while ago said that the enactment of this proposed legislation will result in duplication of some of the State laws. It will duplicate some of the State laws only to the extent, as I see it, that actual violence is involved in the threat or in the operation.
'Mr. President, I may say further that one of the arguments has suggested that in case this provision covered violence it duplicated State law. I wish to point out that the provisions agreed to by the committee covering unfair labor practices on the part of labor unions also might duplicate to some extent that State law. Secondary boycotts, jurisdictional strikes, and so forth, may involve some violation of State law respecting violence which may be criminal, and so to some extent the measure may be duplicating the remedy existing under State law. But that, in my opinion, is no valid argument.'
See also 93 Cong.Rec. 4024; S.Rep. No. 105, 80th Cong., 1st Sess. 50.
11
There it was said:
'The only employee or union conduct and activity forbidden by the state Board in this case was mass picketing, threatening employees desiring to work with physical injury or property damage, obstructing entrance to and egress from the company's factory, obstructing the streets and public roads surrounding the factory, and picketing the homes of employees. So far as the fourteen individuals are concerned, their status as employees of the company was not affected.
'We agree with the statement of the United States as amicus curiae that the federal Act was not designed to prclude a State from enacting legislation limited to the prohibition or regulation of this type of employee or union activity. The Committee Reports on the federal Act plainly indicate that it is not 'a mere police court measure' and that authority of the several States may be exerted to control such conduct. Furthermore, this Court has long insisted that an 'intention of Congress to exclude States from exerting their police power must be clearly manifested'. * * * Congress has not made such employee and union conduct as is involved in this case subject to regulation by the federal Board.' 315 U.S. 740, 748—749, 62 S.Ct. 825.
12
See Weber v. Anheuser-Busch, Inc., 348 U.S. 468, 477, 482, 75 S.Ct. 480, 486, 488; United Construction Workers, Affiliated with United Mine Workers of America v. Laburnum Construction Corp., 347 U.S. 656, 666—669, 74 S.Ct. 833, 838—840, 98 L.Ed. 1025; Garner v. Teamsters, etc., Union, 346 U.S. 485, 488, 74 S.Ct. 161, 164, 98 L.Ed. 228; International Union of United Auto, Aircraft and Agr. Implement Workers of America, C.I.O. v. O'Brien, 339 U.S. 454, 459, 70 S.Ct. 781, 783, 94 L.Ed. 978; International Union, U.A.W., A.F. of L. Local 232 v. Wisconsin Employment Relations Board, 336 U.S. 245, 253, 69 S.Ct. 516, 521, 93 L.Ed. 651.
13
Cf. Hughes v. Superior Court, 339 U.S. 460, 467, 70 S.Ct. 718, 722, 94 L.Ed. 985; International Brotherhood of Teamsters, Chauffeurs, Warehousemen & Helpers Union, Local 309 v. Hanke, 339 U.S. 470, 479, 70 S.Ct. 773, 778, 94 L.Ed. 995.
*
Allen-Bradley Local No. 1111, United Electrical Radio and Machine Workers of America v. Wisconsin Employment Relations Board, 315 U.S. 740, 62 S.Ct. 820, 86 L.Ed. 1154, is not in point because the federal Act at that time made no provision for enjoining union activities.
| 910
|
351 U.S. 292
76 S.Ct. 824
100 L.Ed. 1188
Mabel BLACK and T. Y. Wulff et al., Petitioners,v.CUTTER LABORATORIES, a Corporation.
No. 92.
Argued April 26, 1956.
Decided June 4, 1956.
Mr.Joseph Forer, Washington, D.C., for petitioners.
Messrs. Gardiner Johnson, Thomas E. Stanton, Jr., San Francisco, Cal., for respondent.
Mr. Justice CLARK delivered the opinion of the Court.
1
In 1949 Mrs. Doris Walker was discharged from her job at Cutter Laboratories, a manufacturer of pharmaceutical and biological products, on the claimed grounds that she was an active member of the Communist Party and had falsified her application for employment there.1 Petitioner, Bio-Lab Union of Local 225, United Office & Professional Workers of America, sought reinstatement for Mrs. Walker before an Arbitration Board pursuant to a valid collective-bargaining agreement which authorized discharge for 'just cause' only. The Board determined that she had been discharged for union activity and, by a vote of 2 to 1, ordered her reinstatement. The Superior Court of San Francisco County confirmed the award and ordered it enforced. On appeal, the District Court of Appeal affirmed. The Supreme Court of California, however, reversed. 43 Cal.2d 788, 278 P.2d 905. Petitioners contend that the decision and opinion below violate constitutional principles embraced in the Equal Protection and Due Process Clauses of the Fourteenth Amendment. We granted certiorari, 350 U.S. 816, 76 S.Ct. 51.
2
Before Mrs. Walker applied for a job at the Cutter plant, she had graduated from law school, worked for three years as an attorney for the Office of Price Administration and in private practice, and had been discharged for union activity from jobs in three different canneries. All of these facts, she readily admitted to the Board, were concealed or misrepresented by her in the Cutter employment application in 1946. In addition, she admitted that she had falsely stated that she had been employed as a file clerk in 1939 by one John Trippe, attorney. She told the Board that no such person or employment had existed. The character references she listed had been warned by her of the omissions and falsifications in her application and at her request they did not disclose her true background to Cutter. These falsifications and omissions were not discovered until after she had been employed as a label clerk by the Cutter plant and the 'probationary period' had expired.
3
The Arbitration Board found that Mrs. Walker had played an active role in union activities at the Cutter plant. In 1947 she became a shop chairman and a member of the executive board of the Local. The following year she was elected chief shop steward, and her activities were extended to all manufacturing departments of the Laboratory. She became president of the Local in the spring of 1949, and was holding that office at the time of her discharge. The Board also found that Mrs. Walker was a member of the Communist Party during the period of her employment. Cutter had investigated her in 1947 and 1949 and had discovered evidence of Communist Party membership and also that she had falsified her employment application. The Board's finding of Communist Party membership was based on evidence uncovered in the Cutter investigations plus Mrs. Walker's refusal to answer questions relating to membership and the Union's offer to stipulate that the company could reasonably have concluded that she was a Communist.2
4
The Board took the 'view of the record' that Cutter honestly believed that Mrs. Walker had falsified her application and was a member of the Party. But it held that, 'while an employer may have sufficient grounds for a discharge', he 'should not be entitled tocarry mutually known grounds for discharge in (his) hip pocket indefinitely for future convenient use.' It found Cutter's grounds to be 'stale' and concluded that Mrs. Walker was unjustly discharged and that this action of Cutter 'interfered with, restrained and coerced an employee because of participation as an officer and negotiator on behalf of the Union in a wage negotiation.'
5
The majority opinion of the Supreme Court of California contains broad statements to the effect that specific performance of the arbitration award would violate the public policy of the State. Petitioner's constitutional arguments are based on the belief that these statements establish the ground on which the judgment below was based, and that therefore the decision below not only establishes a conclusive presumption of advocacy of violence from the mere fact of membership in the Communist Party, but renders unenforceable substantially all contracts entered into by members of the Party.
6
This Court, however, reviews judgments, not statements in opinions. Herb v. Pitcairn, 324 U.S. 117, 125—126, 65, S.Ct. 459, 462—463, 89 L.Ed. 789; Morrison v. Watson, 154 U.S. 111, 115, 14 S.Ct. 995, 997, 38 L.Ed. 927. See also Williams v. Norris, 12 Wheat. 117, 118, 120, 6 L.Ed. 571. At times, the atmosphere in which an opinion is written may become so surcharged that unnecessarily broad statements are made. In such a case, it is our duty to look beyond the broad sweep of the language and determine for ourselves precisely the ground on which the judgment rests. This means no more than that we should not pass on federal questions discussed in the opinion where it appears that the judgment rests on adequate state grounds. Herb v. Pitcairn, supra; Williams v. Kaiser, 323 U.S. 471, 477, 65 S.Ct. 363, 366, 89 L.Ed. 398.
7
It is significant that the Supreme Court of California did not limit itself to a discussion of the application of the California public policy. It also subjected the findings of the Arbitration Board to a scrutinizing review. Of course, the scope of review of such findings under the California Arbitration Act is a matter exclusively for the courts of that State, and is not our concern. Allen-Bradley Local v. Wisconsin Employment Relations Board, 315 U.S. 740, 747, 62 S.Ct. 820, 824, 86 L.Ed. 1154.
8
First, the court determined that, since Mrs. Walker was a continuing member of the Communist Party, the doctrine of waiver could not be applied to this ground for discharge. The court noted that Mrs. Walker had remained a member of the Party 'on an active and devoted basis even at the time of the board hearings.'3 43 Cal.2d 807, 278 P.2d 916.
9
Second, it is clear that the individual parties might have agreed that the circumstance of Communist Party membership would constitute 'just cause' under the contract, and no federal question would thereby be raised. It is implicit in the Arbitration Board's opinion that this was a reasonable construction of the contract, but since it applied a doctrine of waiver, no explicit findings on this point were made. But, as we read the opinion of the Supreme Court of California, after concluding that waiver could not be applied to the facts of this case, it decided that the 'just cause' provision of the contract permitted discharge on the ground of Communist Party membership, and that Mrs. Walker was discharged on that ground. The court stated, (43 Cal.2d 788, 278 P.2d 917) 'The contract between Cutter Laboratories and the Bio-Lab Union cannot be construed, and will not be enforced, to protect activities by a Communist on behalf of her party whether in the guise of unionism of otherwise.' At another point, the court noted that 'an entirely adequate ground (Party membership) for refusing to employ her (whether by original refusal to hire or by discharge) was a continuing one which was available to the employer at any time during its existence.' 43 Cal.2d 807, 278 P.2d 916. In this connection, it might also be noted that the court below discussed the history of the clause in the contract which prohibited discrimination 'because of race, color, creed, national origin, religious belief, or Union affiliation.' At one time the word 'political' as well as 'religious belief' was included in the provision, but, by negotiation, it was deleted.
10
We believe that the Supreme Court of California construed the term 'just cause' to embrace membership in the Communist Party, and refused to apply a doctrine of waiver. As such, the decision involves only California's construction of a local contract under local law, and therefore no substantial federal question is presented. Moreover, even if the State Court's opinion be considered ambiguous, we should choose the interpretation which does not face us with a constitutional question. See Stembridge v. Georgia, 343 U.S. 541, 547, 72 S.Ct. 834, 837, 96 L.Ed. 1130, and cases cited. Cf. United States v. Rumely, 345 U.S. 41, 73 S.Ct. 543, 97 L.Ed. 770. It follows that the writ must be dismissed.
11
Writ dismissed.
12
Mr. Justice REED would affirm the judgment below.
13
Mr. Justice DOUGLAS, with whom The CHIEF JUSTICE and Mr. Justice BLACK concur, dissenting.
14
I believe, with all deference, that the decision of the Court abuses the rule that we will not undertake to review a decision of a state court that rests on an independent state ground. No independent state ground is present in this case. Rather, it is easily demonstrated, I think, that the decision of the Supreme Court of California squarely and directly raises an important question under the First and Fourteenth Amendments.
15
At times we have ambiguous opinions that make us unsure of the precise grounds of the decision of the state court. In this case, however, we are left in no doubt. The arbitrators found that the employer discharged this worker because of her labor union activities, using the charge of Communism as a mere pretext. The Supreme Court of California went on no such ground. It is clear from a reading of its opinion, 43 Cal.2d 788, 278 P.2d 905, that it approved the employer's discharge of this worker because she was a Communist. The tactics of Communists and the dangers of Communism make up a total of 11 pages of the 21-page majority opinion of the Supreme Court. Among other things, the Supreme Court of California said:
16
'From the array of congressional and legislative findings which have been quoted above, if not from the common knowledge of mankind, it must be accepted as conclusively established that a member of the Communist Party cannot be loyal to his private employer as against any directive of his Communist master.' Id., 43 Cal.2d at page 806, 278 P.2d at page 916. It went on to hold that 'acts of sabotage by Communists are reasonably to be expected at any time such acts may be directed by the party leader', id., 43 Cal.2d at page 807, 278 P.2d at page 916, and that an employer has the 'right to discharge employees who upon the established facts are dedicated to be disloyal to him, to be likewise disloyal to the American labor union they may purport to serve, and who constitute a continuing risk to both the employing company and the public depending upon the company's products.' Id., 43 Cal.2d at page 807, 278 P.2d at page 917.
17
The arbitrators found that any grievance against Doris Walker was a stale one, the employer having known all her Communist activities for two years. The Superior Court upheld that finding. The District Court of Appeal ruled that the employer 'sat back for two and a half years' and then used her Communist activities as an excuse for injuring the union in its lawful labor activity. 266 P.2d 92, 100. But the Supreme Court held that she was discharged not for her 'labor union activities' but for her 'Communist Party activities.' 43 Cal.2d at page 808, 278 P.2d at page 917. It said that the fact that the employer, knowing all the facts, did nothing for two years was irrelevant, since it was against the 'public policy' of California to conclude that there was a waiver by the failure to discharge a Communist. Id., 43 Cal.2d at page 806, 278 P.2d at page 916. It is plain, therefore, that the judgment of the Supreme Court of California sustains a discharge of this worker because she was a Communist.
18
The Court says that the parties to a collective-bargaining agreement may make Communist Party membership 'just cause' for discharge of an employee, that discharge for that reason is merely a matter of contract between the union on the one hand and the employer on the other, and that when the contract is enforced no federal right is infringed. I disagree with that doctrine. It is a dangerous innovation to meet the exigencies of the present case. It violates First Amendment guarantees of citizens who are workers in our industrial plants.
19
I can better illustrate my difficulty by a hypothetical case. A union enters into a collective-bargaining agreement with an employer that allows any employee who is a Republican to be discharged for 'just cause.' Employers can, of course, hire whom they choose, arranging for an all-Democratic labor force if they desire.* But the courts may not be implicated in such a discriminatory scheme. Once the courts put their imprimatur on such a contract, government, speaking through the judicial branch, acts. Shelley v. Kraemer, 334 U.S. 1, 68 S.Ct. 836, 92 L.Ed. 1161; Barrows v. Jackson, 346 U.S. 249, 73 S.Ct. 1031, 97 L.Ed. 1586. And it is governmental action that the Constitution controls. Certainly neither a State nor the Federal Government could adopt a political test for workers in defense plants or other factories. It is elementary that freedom of political thought is protected by the Fourteenth Amendment against interference by the States, DeJonge v. Oregon, 299 U.S. 353, 364—365, 57 S.Ct. 255, 259—260, 81 L.Ed. 278, and against federal regimentation by the First Amendment.
20
Government may not favor one political group over another. Government may not disqualify one political group from employment. And if the courts lend their support to any such discriminatory program, Shelley v. Kraemer, supra, teaches that the Government has thrown its weight behind an unconstitutional scheme to discriminate against citizens by reason of their political ideology. That cannot be done in America, unless we forsake our Bill of Rights.
21
It has hitherto been assumed that Communists, except and unless they violate laws, are entitled to the same civil rights as other citizens. In 1937, Chief Justice Hughes wrote to that effect for a unanimous Court in DeJonge v. Oregon, supra. That decision held that a State could not punish Communists for having a public meeting to discuss a matter of public concern. Chief Justice Hughes said that First Amendment rights might be abused 'to incite to violence and crime.' Id., 299 U.S. at page 364, 57 S.Ct. at page 260. But he went on to say, 'The people through their Legislatures may protect themselves against that abuse. But the legislative intervention can find constitutional justification only by dealing with the abuse. The rights themselves must not be curtailed. The greater the importance of safeguarding the community from incitements to the overthrow of our institutions by force and violence, the more imperative is the need to preserve inviolate the constitutional rights of free speech, free press and free assembly in order to maintain the opportunity for free political discussion, to the end that government may be responsive to the will of the people and that changes, if desired, may be obtained by peaceful means. Therein lies the security of the Republic, the very foundation of constitutional government.' 299 U.S. 364—365, 57 S.Ct. 260.
22
Cutter Laboratories is an important pharmaceutical factory. It may need special protection. It may need to establish safeguards against sabotage and adulteration. It may need special screening of its employees. But there is not a word in the present record indicating that it needs protection against Doris Walker. She has no criminal record. She is guilty of no adulteration, no act of sabotage. The factory in question has not been plagued with any such problem. It is only the fear that Doris Walker might at a future time engage in sabotage that is made the excuse for her discharge. I do not think we can hold consistently with our Bill of Rights that Communists can be proscribed from making a living on the assumption that wherever they work the incidence of sabotage rises or that the danger from Communist employees is too great for critical industry to bear.
23
The blunt truth is that Doris Walker is not discharged for misconduct but either because of her legitimate labor union activities or because of her political ideology or belief. Belief cannot be penalized consistently with the First Amendment. As Mr. Justice Roberts wrote for a unanimous Court in Cantwell v. Connecticut, 310 U.S. 296, 303—304, 60 S.Ct. 900, 903, 84 L.Ed. 1213, the First Amendment 'embraces two concepts,—freedom to believe and freedom to act. The first is absolute but, in the nature of things, the second cannot be. Conduct remains subject to regulation for the protection of society.' The Court today allows belief, not conduct, to be regulated. We sanction a flagrant violation of the First Amendment when we allow California, acting through her highest court, to sustain Mrs. Walker's discharge because of her belief.
1
At the time of discharge a written notice was read to Mrs. Walker by a company official in the presence of another company official, an assistant shop steward of the union and a company stenographer. The notice read as follows:
'Mrs. Walker:
'As you are aware, the company has known for some time that when you applied for work with Cutter Laboratories on October 4, 1946, you made a number of false representations on your 'Application for Employment.'
'As we know now, you falsified the statement of your education so as to conceal the fact that you had completed a law school course at the University of California's School of Jurisprudence at Berkeley in May, 1942. You concealed the facts that you received the degree of Bachelor of Laws in May, 1942, and that you were admitted to the State Bar of California on December 8, 1942. You concealed that since that date you have at all times been admitted and entitled to practice as an attorney before all of the Courts of California.
'We know now that by falsification of the name of a previous
employer, you concealed the fact that from June, 1942 to February, 1944 you were employed by the Federal Government's Office of Price Administration, including employment as an Enforcement Attorney at a salary of about $3,200.00 a year.
'We know now that you deliberately concealed from us that from February 1944 to December, 1945 you were employed as an attorney by Gladstein, Grossman, Sawyer and Edises, a wellknown firm of lawyers specializing in labor cases.
'You know that a few weeks ago the 'Labor Herald,' the official CIO newspaper, stated that the National Labor Relations Board had sustained a cannery firm that had discharged you for refusing to answer whether or not you were a Communist.
'We have checked the records. We know now that you deliberately concealed that in 1946, just before you applied for work here, you were employed by a series of canneries and had been discharged by them.
'Ordinarily, an employee of the Company would be discharged immediately for falsifying material facts on an 'Application for Employment.' Because you were an officer of the Union we kept you on the pay roll rather than open ourselves to a charge of persecuting a union officer. We have given your case careful consideration because we know very well that no matter how strong the case against you there will be a claim of discrimination because of union activities.
'Because no employer wants to become involved in a dispute of that kind we have been patient and deliberate in our consideration of your misconduct.
'On October 1, 1948, when you testified under oath before a Trial Examiner of the National Labor Relations Board, you refused to answer the question as to whether or not you were a member of the Communist Party.
'You refused to answer under oath the question as to whether or not you were or had been a member of the Federal Workers' Branch No. 3 of the Communist Party.
'You refused to testify under oath whether or not you were or had been a member of the South Side Professional Club of the Communist Party.
'We are convinced now, that you were and still are a member of
the Communist Party, that you were a member of the Federal Workers' Branch No. 3 of the Communist Party, and that you were a member of the South Side Professional Club of the Communist Party.
'Our recent investigation of your past record has uncovered previously unknown conduct that goes far beyond a mere concealment of material facts. We have just completed a thorough investigation and have a full report upon you past activities. We realize now the importance of the facts that you concealed from us. We realize the full implications of your falsification and misrepresentations. A follow-up and investigation of the 'Labor Heralds' recent revelations has uncovered a situation far more grave than we expected.
'We are convinced now that for a number of years, you have been and still are a member of the Communist Party. We are convinced beyond any question that for a number of years you have participated actively in the Communist Party's activities.
'The nature of our company's business requires more than the usual precaution against sabotage and subversion. Upon a disclosure that any employee is a member of the Communist Party, or has participated in other subversive or reevolutionary activity, we conceive it to be the responsibility of management to take action.
'Confronted with such a situation, any inclination to be lenient or to grant a union official special consideration is out. In the face of your record there is no alternative open to us except to terminate your services at once. Accordingly, you are notified now that you are discharged for the causes mentioned. You will be paid the full amount due to you promptly.'
2
Since the Board was authorized to inquire into the reasons for her discharge and the questions were, as it ruled, relevant to the issue, it could draw such inferences as were warranted. In this respect the case is unlike Slochower v. Board of Education, 350 U.S. 551, 76 S.Ct. 637.
3
While the court also spoke of its public policy in reaching this conclusion, its reasoning outlined above amply supports its conclusion.
*
A union has no such liberty if it operates with the sanction of the State or the Federal Government behind it. It is then the agency by which governmental policy is expressed and may not make discriminations that the Government may not make. See Steele v. Louisville & N.R. Co., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173; Tunstall v. Brotherhood, 323 U.S. 210, 65 S.Ct. 235, 89 L.Ed. 187; Brotherhood of Railroad Trainmen v. Howard, 343 U.S. 768, 72 S.Ct. 1022, 96 L.Ed. 1283; Ford Motor Co. v. Huffman, 345 U.S. 330, 337, 73 S.Ct. 681, 685, 97 L.Ed. 1048; Syres v. Oil Workers Union, 350 U.S. 892, 76 S.Ct. 152, reversing 5 Cir., 223 F.2d 739; Railway Employes' Dept. v. Hanson, 351 U.S. 225, 76 S.Ct. 714.
| 89
|
351 U.S. 277
76 S.Ct. 806
100 L.Ed. 1178
Dan DURLEY, Petitioner,v.Nathan MAYO, Custodian, Florida State Prison.
No. 489.
Argued April 2, 1956.
Decided June 4, 1956.
Mr.
Neal P. Rutledge, Miami, Fla., for petitioner.
Mr. Reeves Bowen, Tallahassee, Fla., for respondent.
Mr. Justice BURTON delivered the opinion of the Court.
1
In this case our jurisdiction is questioned by the State of Florida because the judgment of the Supreme Court of that State, which we are asked to review and which was rendered without opinion, may have rested upon an adequate state ground. For the reasons hereafter stated, we find that to be true with the result that we have no jurisdiction to entertain this petition or to consider the merits of the federal questions suggested by petitioner. While we thus deem petitioner's allegations of fact as to the merits of this case to be irrelevant here, we imply nothing as to their truth or falsity, and we refrain from any discussion that depends upon or assumes their truth.
2
In 1945, petitioner Durley was convicted by a jury in the Criminal Court of Record for Polk County, Florida, on two informations. In each he was charged, in three counts, with stealing cattle.1 In the first count of the first information it was charged that, on July 7, 1945, petitioner, with two others, stole two steers from a Mrs. Bronson; in the second count, two cows; and in the third count, one heifer. The three counts of the other information charged that the same men on July 29, 1945, stole from a Mr. Zipperer a cow and two heifers, each of the animals allegedly stolen being the subject of a separate count. Petitioner was sentenced to serve five years' imprisonment on each count, the terms to be served consecutively, thus making a total of 30 years.
3
Petitioner did not appeal from his conviction but, in 1949, labeling his petition a writ of error coram nobis, he, prose, unsuccessfully sought relief. In the same year, also pro se, he filed a petition for a writ of habeas corpus in the Supreme Court of Florida claiming that he was confined in violation of the Fifth Amendment to the Federal Constitution because he had been tried on informations rather than on indictments, that the verdict rested on perjured testimony,2 and that he had been denied a hearing on his petition for a writ of error coram nobis. This petition for habeas corpus was denied by the Supreme Court of Florida, without opinion, on the ground that petitioner failed to show probable cause that he was held without lawful authority.
4
In 1952, with the aid of court-appointed counsel, petitioner filed a petition for a writ of habeas corpus in a Florida Circuit Court. There he claimed that the informations upon which he had been convicted charged the commission of only two, rather than six, offenses and that he already had served sufficient time to satisfy a ten-year sentence which would have been the maximum sentence permissible for two such offenses. Petitioner also charged that his imprisonment was in violation of his rights under the Constitution of the United States. A writ was issued, a return was filed, and the court heard argument of counsel for each side. The writ was quashed. Petitioner appealed to the Supreme Court of Florida, where his appeal was dismissed without opinion.
5
In 1955, petitioner, again pro se, instituted the present proceeding by filing in the Supreme Court of Florida another petition for a writ of habeas corpus. In it he claimed, inter alia, that his detention was an 'abuse of the Due Process Clause of the 14th Amendment to the Constitution of the United States * * *' and that his consecutive sentences not only violated the Federal and State Constitutions, but were contrary to a recent decision of the Supreme Court of Florida, citing Hearn v. State, 55 So.2d 559. That petition was argued in the Supreme Court of Florida by counsel for the State, although neither petitioner nor his counsel was present. The petition was denied, without opinion, again on the ground that petitioner failed to show probable cause that he was held without lawful authority.
6
A rehearing was denied but petitioner's application for a writ of certiorari was granted by this Court, 350 U.S. 872, 76 S.Ct. 120, and counsel was appointed by this Court to represent him here, 350 U.S. 900, 76 S.Ct. 183. The case was fully briefed and argued on the jurisdictional issue as well as on the merits.
7
The State of Florida has objected consistently to our entertaining jurisdiction of this proceeding. Its reason is that the Florida Supreme Court's denial of the 1955 petition for a writ of habeas corpus may have rested upon one or both of two adequate state grounds. Those grounds are (1) that, under Florida law, the issues presented in 1955 already had been rendered res judicata by the 1952 litigation, and (2) that, in any event, petitioner was precluded from raising the federal issues presented in 1955 because he had failed to raise then in comparable prior proceedings where he had a fair and adequate opportunity to do so.
8
The State's claim as to res judicata rests primarily upon Fla.Stat.Ann. § 79.10, which provides that, while a judgment denying a petition for a writ of habeas corpus remains in force, no person 'shall be at liberty to obtain another habeas corpus for the same cause, or by any other proceeding to bring the same matter again in question except by a writ of error or by action of false imprisonment * * *.' Florida's other state ground is based upon its Supreme Court decisions, and particularly upon Washington v. Mayo, 77 So.2d 620, 621. It is there stated that 'The rule is clear that a convicted prisoner should not be heard to raise in a subsequent proceeding, whatever its nature, issues that were previously raised and determined, or that the prisoner had a fair and adequate opportunity to raise and have determined in earlier proceedings.'
9
In the face of these expressions of the law of Florida, petitioner, in order to establish our jurisdiction, must demonstrate that neither of these state grounds can account for the decision below. 'Where the highest court of the state delivers no opinion and it appears that the judgment might have rested upon a nonfederal ground, this Court will not take jurisdiction to review the judgment.' Stembridge v. State of Georgia, 343 U.S. 541, 547, 72 S.Ct. 834, 837, 96 L.Ed. 1130.
10
'It is a well established principle of this Court that before we will review a decision of a state court it must affirmatively appear from the record that the federal question was presented to the highest court of the State having jurisdiction and that its decision of the federal question was necessary to its determination of the cause. Honeyman v. Hanan, 300 U.S. 14, 18, 57 S.Ct. 350, 352, 81 L.Ed. 476; Lynch v. (People of) New York (ex rel. Pierson), 293 U.S. 52, 55 S.Ct. 16, 79 L.Ed. 191. And where the decision of the state court might have been either on a state ground or on a federal ground and the state ground is sufficient to sustain the judgment, the Court will not undertake to review it. Klinger v. (State of) Missouri, 13 Wall. 257, 263, 20 L.Ed. 635; (Walter A.) Wood Mowing & Reaping Machine Co. v. Skinner, 139 U.S. 293, 297, 11 S.Ct. 528, 530, 35 L.Ed. 193; Allen v. Arguimbau, 198 U.S. 149, 154 155, 25 S.Ct. 622, 624, 49 L.Ed. 990; Lynch v. (People of) New York (ex rel. Pierson), supra. * * * But it is likewise well settled that if the independent (state) ground was not a substantial or sufficient one, 'it will be presumed that the State court based its judgment on the law raising the Federal question, and this court will then take jurisdiction.' Klinger v. (State of) Missouri, supra, 13 Wall. at page 263, 20 L.Ed. 635; Johnson v. Risk, 137 U.S. 300, 307, 11 S.Ct. 111, 113, 34 L.Ed. 683; Lawrence v. State Tax Commission, 286 U.S. 276, 282—283, 52 S.Ct. 556, 558, 76 L.Ed. 1102.' Williams v. Kaiser, 323 U.S. 471, 477—478, 65 S.Ct. 363, 367, 89 L.Ed. 398.
11
While the federal questions relied upon by petitioner in 1955 are not set forth by him as clearly as they might be, we do not rely upon that inadequacy.3
12
Petitioner argues that § 79.10 does not embody the traditionally broad doctrine of res judicata. He suggests that the statute bars only the relitigation of questions and matters that have been specifically presented and decided. By thus construing § 79.10, he argues that none of the precise federal issues raised in the 1955 petition were sufficiently raised and considered under his previous petitions. However, the Supreme Court of Florida has treated § 79.10 as applying the general rule of res judicata. See State ex rel. Cacciatore v. Drumbright, 116 Fla. 496, 156 So. 721, 97 A.L.R. 154; State of Florida ex rel. Williams v. Prescott, 110 Fla. 261, 148 So. 533; D'Alessandro v. Tippins, 102 Fla. 10, 137 So. 231. It even has applied that doctrine without reference to § 79.10. See State of Florida ex rel. Davis v. Hardie, 108 Fla. 133, 146 So. 97. On the other hand, it has, at times, treated habeas corpus petitions as barred by § 79.10 only where the issues have been raised and decided in a prior proceeding. See Moat v. Mayo, Fla., 82 So.2d 591; Lee v. Tucker, Fla., 42 So.2d 49; Pope v. Mayo, Fla., 39 So.2d 286; and compare State of Florida ex rel. Williams v. Prescott, supra; State of Florida ex rel. Davis v. Hardie, supra.
13
In its more recent cases, the Supreme Court of Florida has held that, on an original application for habeas corpus, the petitioner may not raise issues that have been raised in prior proceedings whatever those may have been. Also, that unless he can show good reason for his failure to do so, he is precluded from raising issues which he could have raised in any such prior proceedings. Washington v. Mayo, 77 So.2d 620; Irvin v. Chapman, 75 So.2d 591; State ex rel. Johnson v. Mayo, 69 So.2d 307.4 In arguing before us that the issues now raised were or were not raised in prior proceedings, the parties have relied somewhat upon cases from this Court to support their arguments. Those decisions are not squarely in point because the issue before us is not one of federal law. The issue before us on res judicata is whether, under Florida law, petitioner was or was not free to raise in the Supreme Court of Florida in 1955 the questions he attempted to raise there. We conclude that the Supreme Court of Florida might have rested its denial of the 1955 petition on the grounds that the several federal issues presented to it in 1955 had been previously raised within the meaning of § 79.10 and, therefore, could not be raised again under the state practice, or at least could have been raised in the prior proceedings and, accordingly, under the above decisions they likewise were not available as a matter of state law.5
14
Petitioner further suggests that, under Florida law, the doctrine of res judicata will 'not be so rigidly applied as to defeat the ends of justice.' Universal Const. Co. v. City of Fort Lauderdale, 68 So.2d 366, 369. Relying on that case, petitioner argues that the application of res judicata is within the discretion of the court, but that case does not provide the necessary authority for that conclusion. In that case, the Supreme Court of Florida, exercising traditional common-law and equitable powers, created an exception to the common-law doctrine of res judicata because of an 'unusual situation' confronting it. Id., 68 So.2d at page 370. The question before us is whether, under the facts of this case, the Supreme Court of Florida must necessarily read a similar exception into an Act of the legislature. We find no authoritative basis for doing so.
15
Finally, it is suggested that the order of the Florida court denying the 1955 petition shows affirmatively that the court decided the petition on the merits of the federal questions raised. We do not so read it. At most it is inconclusive and leaves room for a decision on the state grounds indicated in § 79.10 or by Washington v. Mayo, supra. The language of the order is that petitioner 'failed to show * * * probable cause to believe that he is detained in custody without lawful authority * * *.' That is stated in the standard form used in habeas corpus proceedings. We find nothing on its face showing that the court must have decided the case on federal grounds rather than on the readily available and substantial state grounds.
16
Inasmuch as the Supreme Court of Florida's denial of the 1955 petition might have rested on either of the state grounds now suggested by the State, petitioner has failed to establish our jurisdiction to decide the federal issues that he urges upon us. He has not shown that they have been passed upon by the highest court of his State.
17
For lack of jurisdiction, the case, therefore, must be dismissed.
18
Dismissed.
19
Mr. Justice DOUGLAS, with whom The CHIEF JUSTICE, Mr. Justice BLACK and Mr. Justice CLARK, concur. dissenting.
20
Petitioner is a prisoner in the Florida State Prison, serving a total sentence of 30 years for cattle stealing. In February 1955 he filed a petition for a writ of habeas corpus in the Supreme Court of Florida. That court denied the petition without affording petitioner a hearing and without requiring a response from respondent, the custodian of the prison. A timely motion for rehearing was also denied. We granted certiorari. 350 U.S. 872, 76 S.Ct. 120.
21
In these circumstances, the allegations of the petition must be accepted as true for purposes of review. See Hawk v. Olson, 326 U.S. 271, 273, 66 S.Ct. 116, 117, 90 L.Ed. 61; Williams v. Kaiser, 323 U.S. 471, 473—474, 65 S.Ct. 363, 365, 89 L.Ed. 398. If they are taken as true, we have a shocking case of miscarriage of justice.
22
In 1945 the County Solicitor for Polk County, Florida, filed two informations charging petitioner and two codefendants, R. B. Massey, Jr., and Charles Bath, with six offenses of stealing cattle, each information containing three separate counts. The first count of the first information charged that the three defendants on July 7, 1945, stole two steers belonging to Mrs. Edna P. Bronson; the second count charged that the three defendants on July 7, 1945, stole two cows belonging to Mrs. Bronson; and the third count charged that on July 7, 1945, they stole one heifer belonging to Mrs. Bronson. In the second information, the first count charged that the three defendants on July 29, 1945, stole one cow belonging to William C. Zipperer; the second count charged that the three defendants on July 29, 1945, stole one heifer belonging to Mr. Zipperer; and the third count charged that, on the same day, the defendants stole one heifer belonging to Mr. Zipperer. The second and third counts of the second information are virtually identical.
23
At the trial petitioner asserted his innocence. His two codefendants, however, admitted their guilt and implicated petitioner. Their testimony was the only evidence liking petitioner with the crimes charged. All three were convicted. Bath apparently received a sentence of two years' imprisonment and Massey, 26 years. Petitioner, 53 years old at the time and never before accused of dishonesty, was sentenced to five years' imprisonment on each of the 6 counts, each sentence to be served consecutively, making a total sentence of 30 years. Petitioner, now 63 years old, has served more than 10 years of his sentence.
24
In May 1949 petitioner, without the assistance of counsel, prepared a petition for writ of habeas corpus and filed it in the Supreme Court of Florida. The petition was inartistically drawn. Petitioner contended that his trial on a bill of information rather than on a grandjury indictment violated the Fifth Amendment of the United States Constitution. Secondly, he contended that 'he is innocent of said offense and is falsely imprisoned by reason that verdict of guilty was wholly supported by prejudge (sic) and perjured testimony.' Accompanying the petition was an affidavit by one J. E. Croft relating a prison conversation he had with Bath, the codefendant who received the relatively light sentence of two years' imprisonment. According to this affidavit, Bath told Croft that petitioner was completely innocent. Bath described an agreement which he and codefendant Massey had made before they embarked on their cattle-stealing ventures. They agreed that, if they were caught, they would say they were working for petitioner, for whom they had worked as laborers on other occasions. Bath explained that by naming petitioner they had hoped to be 'passed up' and given a chance to get out of the country.
25
In addition to the Croft affidavit, the habeas corpus petition was accompanied by an affidavit signed and sworn to by Massey. He recanted his trial testimony, clearing petitioner of all responsibility for the stolen cattle. Massey stated that his story implicating petitioner 'was a falsehood and that I gave such testimony, hoping that it would aid me when my case came up.' The affidavit concluded, 'Before God is my judge Dan Durley, never had anything to do with any cattle stealing that I testified to at the trial.'
26
The Supreme Court of Florida denied the 1949 petition for a writ of habeas corpus on the ground that petitioner had failed to show probable cause that his detention was unlawful. It should be noted that the 1949 petition did not assert that the use of perjured testimony deprived petitioner of a federal constitutional right.
27
In January 1952 petitioner filed a second habeas corpus petition in the Circuit Court of Union County, Florida, this time assisted by court-appointed counsel. He contended that the six 5-year sentences amounted to double jeopardy because the two informations upon which he was convicted charged him in substance with no more than two offenses, each of which carried a maximum penalty of 5 years, and that petitioner had already served sufficient time to satisfy a 10-year sentence. He made a general claim that his imprisonment was 'in direct violation of his rights as set out in the Constitution of the United States.' There was no mention of the perjured testimony issue. After argument the Circuit Court of Union County quashed the writ. An appeal to the Supreme Court of Florida was dismissed.
28
The basis of the present litigation is the habeas corpus petition filed in the Florida Supreme Court in February 1955. Petitioner prepared it without the aid of counsel. The petition repeats the double-jeopardy contention as well as the charge that he was convicted solely on the basis of perjured testimony, coupling these allegations with a claim that his imprisonment deprives him of liberty 'in violation of his Constitutional Rights afforded him by the State of Florida and the Constitution of the United States of America.' His federal constitutional arguments were elaborated in the motion for rehearing. Petitioner's claim that it violates due process to let his conviction stand solely on perjured testimony was raised for the first time in the 1955 habeas corpus petition—the one now under consideration.1
29
The Court dismisses the case on the ground that the Florida Supreme Court order denying habeas corpus might have rested on an adequate state ground—res judicata. I disagree.
30
The Court concludes that under Florida law petitioner is barred from raising federal issues in the 1955 habeas corpus proceeding because he had raised them or at least had a fair and adequate opportunity to raise them in prior habeas corpus proceedings. The Court strangely relies on Washington v. Mayo, 77 So.2d 620. That case involved a habeas corpus petition in which two contentions were raised. The first contention had been expressly raised and decided in a previous habeas corpus proceeding. The second contention, however, had not been raised previously. This contention was decided on the merits by the Florida Supreme Court even though the petitioner 'has not shown that he did not have a fair and adequate opportunity to raise and have it determined.' Id., 77 So.2d at page 622.
31
Johnson v. Mayo, 69 So.2d 307, and Irvin v. Chapman, 75 So.2d 591, also relied on by the Court, are not in point. In both cases, the Florida Supreme Court held that an issue that could have been raised on direct appeal from the conviction could not be litigated in subsequent habeas corpus proceedings.2 Those cases did not involve the question now before us—whether prior habeas corpus proceedings bar the litigation of issues which could not have been raised on direct appeal from the conviction.3
32
The Florida Supreme Court has expressly dismissed a number of habeas corpus proceedings on the ground that former habeas corpus adjudications were res judicata. But in those cases the habeas corpus petitions attempted to relitigate issues which had been expressly presented and decided in the previous habeas corpus proceedings. See Moat v. Mayo, 82 So.2d 591; Pope v. Mayo, 39 So.2d 286; State ex rel. Williams v. Prescott, 110 Fla. 261, 148 So. 533.
33
Res judicata is not a rigid doctrine in Florida. The Supreme Court recently refused to apply it where to do so would 'defeat the ends of justice.' Universal Const. Co. v. City of Ft. Lauderdale, 68 So.2d 366, 369.4 Once the facts alleged by petitioner are conceded, as they must be on the present record, it defeats the ends of justice to deny relief here.
34
The language of the Florida Supreme Court's order in the present case indicates that petitioner's federal constitutional claims were rejected not on grounds of res judicata but on their merits. The petition was denied because of failure to show 'probable cause to believe that (petitioner) is detained in custody without lawful authority.' Faced with a similar state court order in Williams v. Kaiser, supra, 323 U.S. 478, 65 S.Ct. 367, we said: 'The denial of the petition on the grounds that it fails to state a cause of action strongly suggests that it was denied because there was no cause of action based on the federal right.' We should hold the same in the present case.
35
Once we reach the merits the answer seems clear. It is well settled that to obtain a conviction by the use of testimony known by the prosecution to be perjured offends due process. Mooney v. Holohan, 294 U.S. 103, 55 S.Ct. 340, 79 L.Ed. 791; Pyle v. State of Kansas, 317 U.S. 213, 63 S.Ct. 177, 87 L.Ed. 214. While the petition did not allege that the prosecution knew that petitioner's codefendants were lying when they implicated petitioner, the State now knows that the testimony of the only witnesses against petitioner was false. No competent evidence remains to support the conviction. Deprivation of a hearing under these circumstances amounts in my opinion to a denial of due process of law.
36
Perhaps a hearing on the charges would dispel them. But on the present record, we have a grave miscarriage of justice involving an invasion of federal rights guaranteed by the Fourteenth Amendment.
1
'811.11 Horse or cattle stealing
'Whoever commits larceny by stealing any horse, mule, mare, filly, colt, cow, bull, ox, steer, heifer or calf, the property of another, shall be punished by imprisonment in the state prison not less than two years nor more than five years.' Fla.Stat.Ann.
2
There was no allegation in this or the subsequent petition that the prosecution knowingly used perjured testimony as in Monney v. Holohan, 294 U.S. 103, 55 S.Ct. 340, 79 L.Ed. 791.
3
The 1955 petition for habeas corpus and the petition for certiorari to this Court were drafted by petitioner. In similar cimcumstances, this Court has held that 'where the substance of the claim is clear, we should not insist upon more refined allegations than (such a person) could be expected to supply.' Tomkins v. State of Missouri, 323 U.S. 485, 487, 65 S.Ct. 370, 372, 89 L.Ed. 407; Rice v. Olson, 324 U.S. 786, 791—792, 65 S.Ct. 989, 991—992, 89 L.Ed. 1367; Holiday v. Johnson, 313 U.S. 342, 350, 61 S.Ct. 1015, 1017, 85 L.Ed. 1392. Florida follows the same practice. Ex parte Amos, 93 Fla. 5, 12, 112 So. 289, 292; Chase v. State of Florida ex rel. Burch, 93 Fla. 963, 968, 113 So. 103, 106, 54 A.L.R. 271.
4
While it is true that in the Johnson and Irvin cases the issues sought to be raised in the habeas corpus proceeding could have been raised on direct appeal, the court held that the writ was not available because the petitioners had failed to raise those issues in 'prior proceeding.' These included a writ of error coram nobis in Johnson and a previous trial on the merits in Irvin.
It is suggested that the Washington case does not preclude this Court from taking jurisdiction because in that case the court, while stating the rule that would preclude jurisdiction, did consider on its merits a nonfederal contention which had not been previously raised. But assuming that the contention so considered had involved a substantial federal question, this Court would have lacked jurisdiction to review the judgment for the reason that it might have rested upon the adequate state ground. For our purposes, therefore, the discussion of the merits in that case may be treated as dicta.
Furthermore, the contention considered on its merits in the Washington case 'apparently was not raised upon the earlier proceeding * * *.' 77 So.2d at page 622. In the instant case, the perjury issue was presented in the 1949 petition, although not in terms of a federal constitutional issue. The Washington case, therefore, is certainly no authority for a conclusion in the instant case that any issues growing out of the previously raised issue, that the conviction rested upon perjured testimony, could be raised in the proceeding which is before us.
5
Our discussion of the Florida law is solely for the purpose of determining whether the test for our jurisdiction is met. We do not intimate that, uhder that law, petitioner is foreclosed from seeking any further remedial process that may be open to him.
1
In the 1949 petition, petitioner argued that the testimony was perjured, but he did not present this as a federal question. The 1952 petition did not mention the perjured testimony issue.
2
The Florida Supreme Court stated the rationale of these decisions as follows: 'It is elementary that a writ of habeas corpus cannot be used as a substitute for appeal, motion to quash or a motion in arrest of judgment.' Johnson v. Mayo, 69 So.2d at page 308.
3
Petitioner's claim of a denial of federal rights because his conviction is based solely on perjured testimony obviously could not have been raised on direct appeal. He did not obtain the affidavits showing that the witnesses had lied until long after the time to appeal his conviction had expired.
4
'The basic principle upon which the doctrine of res judicata rests is that there should be an end to litigation and that 'in the interest of the State every justiciable controversy should be settled in one action in order that the courts and the parties will not be bothered for the same cause by interminable litigation.' (Gordon v. Gordon, 59 So.2d 40,) at page 44; italics supplied. Nevertheless, when a choice must be made we apprehend that the State, as well as the courts, is more interested in the fair and proper administration of justice than in rigidly applying a fiction of the law designed to terminate litigation.' 68 So.2d at page 369.
| 89
|
351 U.S. 305
76 S.Ct. 937
100 L.Ed. 1209
UNITED STATES of America, Appellant,v.McKESSON AND ROBBINS, Inc.
No. 448.
Argued April 30, 1956.
Decided June 11, 1956.
Mr.Ralph S. Spritzer, Washington, D.C., for appellant.
Mr. John P. McGrath, New York City, for appellee.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
This is a direct appeal by the Government under the Expediting Act, 32 Stat. 823, 15 U.S.C. § 29, as amended by 62 Stat. 869, 15 U.S.C.A. § 29, from a decision of the District Court for the Southern District of New York, interpreting the scope of the exemption from the antitrust laws provided by 'fair trade' legislation.
2
Appellee, a Maryland corporation with its home office in New York, is the largest drug wholesaler in the United States. Operating through 74 wholesale divisions located in 35 states, it sells drugstore merchandise of various brands to retailers, principally drugstores, substantially throughout the nation. For the fiscal year ended March 31, 1954, its sales of all drug products amounted to $338,000,000.
3
Appellee is also a manufacturer of its own line of drug products, the total sales of which amounted to $11,000,000 for the year ended March 31, 1954. Its manufacturing operation is conducted through a single manufacturing division, McKesson Laboratories, located at Bridgeport, Connecticut. This division, like each of appellee's wholesale divisions, has a separate headquarters and a separate staff of employees, but none of the 75 divisions is separately incorporated. All are component parts of the same corporation and are responsible to the corporation's president and board of directors.
4
Appellee distributes its own brand products to retailers through two channels: (1) directly to retailers, and (2) through independent wholesalers. The major portion of its brand products is distributed to retailers through its own wholesale divisions. Appellee also makes direct sales to important retailers through its manufacturing division. Most of appellee's sales to independent wholesalers are made by its manufacturing division, but its wholesale divisions sold approximately $200,000 of McKesson brand products to other wholesalers during the fiscal year ended June 30, 1952.
5
To the extent possible under state law, appellee requires all retailers of its brand products to sell them at 'fair trade' retail prices fixed by appellee. These prices are set forth in published schedules of wholesale and retail prices.
6
Appellee also has 'fair trade' agreements with 21 independent wholesalers who buy from its manufacturing division. Sixteen of these independents compete with appellee's wholesale divisions. The other 5 compete with the manufacturing division for sales to chain drugstores located in their trading areas. On June 6, 1951, in accordance with appellee's 'fair trade' policy, a vice president in charge of merchandising notified appellee's wholesale divisions that—
7
'None of our wholesale divisions will sell any McKesson labeled products to any wholesaler who has not entered into a fair trade contract with McKesson Laboratories.'
8
As a result, 73 of the independent wholesalers who had been dealing with McKesson wholesale divisions entered into 'fair trade' agreements with McKesson by which they bound themselves in reselling its brand products to adhere to the wholesale prices fixed by it. Each of these independent wholesalers is in direct competition with the McKesson wholesale division from which it buys.
9
The Government, under Section 4 of the Sherman Act,1 brought this civil action for injunctive relief against appellee in the District Court. The complaint charged that appellee's 'fair trade' agreements with independent wholesalers with whom it was in competition constituted illegal price fixing in violation of Section 1 of the Act. Appellee admitted the contracts, but claimed that they were exempted from the Sherman Act by the Miller-Tydings Act2 and the McGuire Act.3
10
The Government moved for summary judgment on the ground that these Acts do not immunize McKesson's agreements with other wholesalers, since they expressly exclude from their exemption from the antitrust laws contracts 'between wholesalers' or 'between persons, firms, or corporations in competition with each other.' The district judge denied the motion.4 He recognized that price fixing is illegal per se under the Sherman Act, but announced that in 'fair trade' cases 'No inflexible standard should be laid down to govern in advance.' He was 'unwilling, at this stage of case law development of legislatively sanctioned resale price fixing' to apply the per se rule 'in fair trade situations absent a factual showing of illegality.' Such a showing, he said, could not be made 'simply by pointing to some restraint of competition.' The "true test of legality" of 'fair trade' agreements between a producer-wholesaler and independent wholesalers, the court held, 'is whether some additional restraint destructive of competition is occasioned.'5
11
The case then proceeded to trial before another district judge, who concurred in the 'ruling that fair trade price fixing by a producer-wholesaler was not per se illegal under the Sherman Act,' and held that the Government's evidence did not establish an 'additional restraint' within the meaning of the test previously enunciated in the case.6 He ordered the complaint dismissed, and the Government took a direct appeal under the Expediting Act. We noted probable jurisdiction.7
12
The issue presented is a narrow one of statutory interpretation. The Government does not question the so-called vertical 'fair trade' agreements between McKesson and retailers of McKesson brand products. It challenges only appellee's price-fixing agreements with independent wholesalers with whom it is in competition.
Section 1 of the Sherman Act provides:
13
'Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is hereby declared to be illegal * * *.'8
14
It has been held too often to require elaboration now that price fixing is contrary to the policy of competition underlying the Sherman Act and that its illegality does not depend on a showing of its unreasonableness, since it is conclusively presumed to be unreasonable.9 It makes no difference whether the motives of the participants are good or evil; whether the price fixing is accomplished by express contract or by some more subtle means; whether the participants possess market control; whether the amount of interstate commerce affected is large or small; or whether the effect of the agreement is to raise or to decrease prices.10
15
In United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 60 S.Ct. 811, 84 L.Ed. 1129, in holding price-fixing agreements to be illegal per se, this Court said:
16
'Congress has not left with us the determination of whether or not particular price-fixing schemes are wise or unwise, healthy or destructive. * * * the Sherman Act, so far as price-fixing agreements are concerned, establishes one uniform rule applicable to all industries alike.'11
And it has been said by this Court:
17
'A distributor of a trade-marked article may not lawfully limit by agreement, express or implied, the price at which or the persons to whom its purchaser may resell, except as the seller moves along the route which is marked by the Miller-Tydings Act.'12
18
The question before us is whether the price-fixing agreements challenged herein move along that route. If they do not, they are illegal per se. There is no basis for supposing that Congress, in enacting the Miller-Tydings and McGuire Acts, intended any change in the traditional per se doctrine. The District Court was plainly in error in attempting to create a category of agreements which are outside the exemption of those Acts but which should nevertheless be spared from application of the per se rule.
19
In the Miller-Tydings Act, passed as a rider to a District of Columbia revenue bill, Congress was careful to state that its exemption of certain resale price maintenance contracts from the prohibitions of the antitrust laws 'shall not make lawful any contract or agreement, providing for the establishment or maintenance of minimum resale prices on any commodity herein involved, between manufacturers, or between producers, or between wholesalers, or between brokers, or between factors, or between retailers, or between persons, firms, or corporations in competition with each other.'13 (Emphasis supplied.)
20
Fifteen years later, Congress attached an almost identical proviso to the McGuire Act.14 We are to take the words of these statutes 'in their normal and customary meaning.' Schwegmann Bros. v. Calvert Corp., 341 U.S. 384, 388, 71 S.Ct. 745, 747, 95 L.Ed. 1035.
21
Appellee is admittedly a wholesaler with resale price maintenance contracts with 94 other wholesalers who are in competition with it. Thus, even if we read the proviso so that the words 'in competition with each other' modify 'between wholesalers,' the agreements in question would seem clearly to be outside the statutory exemption. Appellee concedes that the proviso does not exempt a contract between two competing independent wholesalers fixing the price of a brand product produced by neither of them.15 Yet it urges that what would be illegal if done between competing independent wholesalers becomes legal if done between an independent wholesaler and a competing wholesaler who is also the manufacturer of the brand product. This is so, appellee maintains, because in contracting with independent wholesalers it acted solely as a manufacturer selling to buyers rather than as a competitor of these buyers. But the statutes provide no basis for sanctioning the fiction of McKesson, the country's largest drug wholesaler, acting only as a manufacturer when it concludes 'fair trade' agreements with competing wholesalers. These were agreements 'between wholesalers.'
22
Any doubts which might otherwise be raised as to the propriety of considering a manufacturer-wholesaler as a 'wholesaler' are dispelled by the last phrase of the proviso in question, which continues the proscription against price-fixing agreements 'between persons, firms, or corporations in competition with each other.' Congress thus made as plain as words can make it that, without regard to categories or labels, the crucial inquiry is whether the contracting parties compete with each other. If they do, the Miller-Tydings and McGuire Acts do not permit them to fix resale prices. The Court stated in Schwegmann Bros. v. Calvert Corp., 341 U.S. 384, 389, 71 S.Ct. 745, 748, that this proviso 'expressly continues the prohibitions of the Sherman Act against 'horizontal' price fixing by those in competition with each other at the same functional level.'16 Since appellee competes 'at the same functional level' with each of the 94 wholesalers with whom it has price-fixing agreements, the proviso prevents these agreements from falling within the statutory exemption.
23
Appellee argues that a brief colloquy on the Senate floor between a supporter of the McGuire Act and an inquiring Senator Shortly before the Act was passed should dictate a meaning contrary to that revealed by the Act's plain language. But, at best, the statement was inconclusive.17 And the Senator whose statement is relied on was not in charge of the bill, nor was he a member of any committee that had considered it. Moreover, the McGuire Act was not a Senate bill, having been passed by the House of Representatives prior to this Senate discussion. There is nothing in the proceedings of the House to indicate that the meaning for which appellee contends should be given to the Act. Similarly, except to show congressional concern that the prohibition against 'horizontal' price fixing be continued, the Senate and House debates on the proviso in the Miller-Tydings Act are of little assistance with respect to the problem before us.
24
The court below did not rely on the legislative history, finding it to be 'unedifying and unilluminating.'18 We agree with this appraisal, but are not troubled by it since the language of the proviso in question is unambiguous.19 It excludes from the exemption from the per se rule of illegality resale price maintenance contracts between firms competing on the same functional level.
25
Both the Government and appellee press upon us economic arguments which could reasonably have caused Congress to support their respective positions.20 We need not concern ourselves with such speculation. Congress has marked the limitations beyond which price fixing cannot go. We are not only bound by those limitations but we are bound to construe them strictly, since resale price maintenance is a privilege restrictive of a free economy. Cf. United States v. Masonite Corp., 316 U.S. 265, 280, 62 S.Ct. 1070, 1078, 86 L.Ed. 1461.
26
The judgment of the District Court dismissing the complaint must, therefore, be reversed and the case remanded for further proceedings not inconsistent with this opinion.
27
Reversed and remanded.
28
Mr. Justice HARLAN, whom Mr. Justice FRANKFURTER and Mr. Justice BURTON join, dissenting.
29
Lack of sympathy with an Act of Congress does not justify giving to it a construction that cannot be rationalized in terms of any policy reasonably attributable to Congress. Rather our duty, as always, is to seek out the policy underlying the Act and, if possible, give effect to it. In this instance, I think the Court has departed from that rule by giving the Miller-Tydings and McGuire Acts an artificial construction which produces results that could hardly have been intended by Congress.
30
The purpose of the state fair-trade laws is to allow the manufacturer of a brand-named product to protect the goodwill his name enjoys by controlling the prices at which his branded products are resold. Old Dearborn Distributing Co., v. Seagram-Distillers Corp., 299 U.S. 183, 193—194, 57 S.Ct. 139, 144, 81 L.Ed. 109. The necessary result—indeed, the very object—is to permit the elimination of price competition in the granded product among those who sell it. Congress has sanctioned those laws in the Miller-Tydings and McGuire Acts, considering them not to be offensive to federal antitrust policy.1 Sufficient protection to the public interest was deemed to be afforded by the competition among different brands, a safeguard made express by the provision of the Miller-Tydings and McGuire Acts denying fair-trade contracts exemption from the antitrust laws unless the fair-traded product is 'in free and open competition with commodities of the same general class.' In short, the very purpose of the Acts is to permit a manufacturer to set the resale price for his own products while preserving competition between brands that is, between the fair-traded item and similar items produced by other manufacturers.
31
If we accept the legislative judgment implicit in the Acts that resale price maintenance is necessary and desirable to protect the goodwill attached to a brand name, there is no meaningful distinction between the fair-trade contracts of integrated and non-integrated manufacturers. Certainly the integrated manufacturer has as strong a claim to protection of his goodwill as a non-integrated manufacturer, and the economic effect of the contracts is the same. In both cases price competition in the resale of the branded product is eliminated, and in neither case does the price fixing extend beyond the manufacturer's own product. While the Government concedes the right of a non-ingetrated manufacturer to eliminate price competition in his products between wholesalers, it finds a vice not contemplated by the Acts when one of the 'wholesalers' is also the manufacturer, for then the contracts eliminate competition between the very parties to the contracts. But, in either case, all price competition is eliminated, and I am unable to see what difference it makes between whom the eliminated competition would have existed had it not been eliminated. The other bases of distinction suggested by the Government are equally tenuous and reflect a subtlety of analysis for which there is no support in either the Acts or their history.
32
So unsatisfactory, indeed, are the Government's attempts to rationalize the result contended for, that the Court chooses not to rely upon them, finding the language of the provisos so clear as to make it unnecessary even to hypothesize a consistent rational attributable to Congress that might justify the discrimination against integrated producers. Indeed, not even the fact that the only legislative history directly in point is squarely opposed to the Court's reading of the statute (see note 17 of the Court's opinion, 76 S.Ct. 942), prompts enough doubt in the Court to require an inquiry into the purpose of the Acts. The Court's reasoning is this: the provisos except from the Acts contracts 'between wholesalers' or 'between persons, firms, or corporations in competition with each other'; McKesson is a 'wholesaler' as well as a manufacturer and is also 'in competition with' independent wholesalers; its contracts with independent wholesalers are therefore forbidden contracts 'between wholesalers' and between 'corporations in competition with each other.' This verbalistic argument can be answered by the equally verbalistic one that the fair-trade contracts, being made in connection with the sale of its own branded products, were made by McKesson in its capacity as a 'manufacturer' rather than as a competing 'wholesaler.' Neither argument being more conclusive than the other, the answer to the problem can be found only by looking to the purpose of the provisos and its relation to the basic policy of permitting resale price maintenance of branded goods.
33
As noted above, the Acts necessarily contemplate the elimination of price competition in the resale of a particular branded product and rely for protection of the public interest upon competition between brands. Viewed in the light of this purpose, the provisos become readily understandable. The vice of price-fixing agreements between those in competition with each other, whether at the manufacturing, wholesaling, or retailing level, is that they can be utilized to eliminate competition between brands. Thus manufacturers might agree to fix the resale prices of their competing brands in relation to each other; the same result, on an even broader scale, could be achieved by agreements between wholesalers or retailers. Further, agreements initiated by anyone other than the owner of the brand name are unnecessary to the protection of goodwill, the very justification for permitting fair-trade contracts. Thus an agreement between wholesalers to fix the price of a product bearing the trade name of neither would serve no purpose other than the elimination of competition. Interpreting the provisos in the light of these considerations, I conclude that an integrated manufacturer selling its products under fair-trade contracts to independent wholesalers should be deemed to be acting as a 'manufacturer' rather than as a 'wholesaler.' This interpretation of the provisos fits with their terms and produces, rather than an arbitrary discrimination hardly intended by Congress, a result fully in harmony with the policy of the Acts to permit manufacturers to maintain the resale prices of their branded products while preserving competition between brands.2
34
For these reasons, therefore, I would hold McKesson's contracts to be within the Miller-Tydings and McGuire Acts and would affirm the judgment below.
1
26 Stat. 209, 15 U.S.C.A. § 4.
2
50 Stat. 693, 15 U.S.C.A. § 1.
3
66 Stat. 632, 15 U.S.C.A. § 45.
4
122 F.Supp. 333.
5
122 F.Supp., at pages 337—339. The district judge provided an illustration of the kind of conduct which might satisfy his test:
'If, for example, it could be established that a producer became a wholesaler, though not in competition with an independent wholesaler, and stipulated prices for his own and the independent wholesaler as a first step toward and with intent to gouge consumers, that might suffice prima facie as violation of the Sherman Act outside the privilege of the fair trade statutes.'
6
R. 180.
7
350 U.S. 922, 76 S.Ct. 211.
8
26 Stat. 209.
9
E.g., United States v. Trenton Potteries Co., 273 U.S. 392, 397, 47 S.Ct. 377, 379, 71 L.Ed. 700; Ethyl Gasoline Corp. v. United States, 309 U.S. 436, 458, 60 S.Ct. 618, 626, 84 L.Ed. 852. See also Standard Oil Co. v. United States, 221 U.S. 1, 65, 31 S.Ct. 502, 517, 55 L.Ed. 619.
10
United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 221 224, 60 S.Ct. 811, 843—844.
11
310 U.S. at pages 221—222, 60 S.Ct. at page 843.
12
United States v. Bausch & Lomb Co., 321 U.S. 707, 721, 64 S.Ct. 805, 812, 88 L.Ed. 1024.
13
50 Stat. 693. This proviso qualified the proviso immediately preceding it, which amended § 1 of the Sherman Act so as to make lawful resale price maintenance contracts entered into by manufacturers of branded or trade-marked goods if such contracts are authorized by state law as to intrastate transactions and if the commodity affected is in 'free and open competition with commodities of the same general class produced or distributed by others * * *.'
14
66 Stat. 632. The McGuire Act amended § 5(a) of the Federal Trade Commission Act by adding, inter alia, § 5(a)(2). This specifically exempts from the antitrust laws price fixing under 'fair trade' agreements which bind not only retailers who are parties to the agreement but also retailers who refuse to sign the agreement. As in the Miller-Tydings Act, the statutory exemption was qualified by an important proviso. This stated:
'(5) Nothing contained in paragraph (2) of this subsection shall make lawful contracts or agreements providing for the establishment or maintenance of minimum or stipulated resale prices on any commodity referred to in paragraph (2) of this subsection, between manufacturers, or between producers, or between wholesalers, or between brokers, or between factors, or between retailers, or between persons, firms, or corporations in competition with each other.' (Emphasis supplied.)
15
Appellee's brief, p. 6. In the District Court and in its motion to affirm filed in this Court, however, appellee claimed that the proviso applies only to agreements 'between manufacturers of competing products, or between wholesalers of competing products, or retailers of such products, fixing the prices at which two or more competitive products are to be sold.' (Appellee's emphasis.) Motion to affirm, pp. 5—6.
16
Previous phrases of the proviso appear in state 'fair trade' laws, upon which the proviso seems to have been modeled. FTC Report on 'Resale Price Maintenance,' pp. 80—81 (1945). The last phrase, however, has apparently never been included in any state statute. Thus, meticulous inclusion of this phrase in the federal acts is not without significance.
17
98 Cong.Rec. 8870. Senator Humphrey, in answer to an inquiry by Senator Sparkman, said:
'* * * If, for example, when a producer, who sells to distributors, wholesalers, retailers, and consumers, makes a resale price-maintenance agreement relative to a commodity made by him and bearing a trade-mark or brand, with a distributor, wholesaler, or retailer who resells such commodity at either the wholesale, or retail level, there
exists a vertical resale price-maintenance contract which would be lawful under the bill if the requirements of paragraph (2) are met.
'On the other hand, if one wholesaler enters into a resale price-maintenance agreement with another wholesaler prescribing the price at which they both sell a trade-marked or branded commodity which they both buy from the producer, that agreement would be horizontal and would not be made lawful.
'In other words, wholesalers getting together on a price are acting illegally. For a manufacturer to get together with other manufacturers to maintain prices is illegal, but for a manufacturer to say that a certain product will sell at a certain price from the manufacturer down to the retailer is legal under the limitations prescribed in paragraph (2) of section 5(a) of the Federal Trade Commission Act.
'In general, the test of whether a resale price-maintenance contract is vertical is if the contract is between a seller and buyers who resell the original seller's product; whereas, the test of whether a resale price-maintenance contract is horizontal as if it is between competing sellers between whom the relation of buyer and seller or reseller does not exist as to the product involved.
'It is important to keep this distinction in mind, because many producers of trade-marked items sell them to consumers, retailers, and wholesalers alike.
'Under the bill, such firms may make resale price-maintenance contracts with both wholesalers and retailers because such contracts are vertical, that is, between sellers and buyers. While in one sense firms in this position function not only as producers but also as wholesalers and retailers, they may still lawfully make contracts with other wholesalers and retailers, when in making such contracts they act as producers of a trade-marked or branded commodity, rather than as wholesalers and retailers entering into forbidden horizontal resale price-maintenance contracts with other wholesalers or other retailers.' (Emphasis added.)
It should be noted that these remarks appear to be confined to the 'between wholesalers' and 'between retailers' phrases and do not deal with the 'corporations in competition' phrase. And, even as to the former, it is not at all clear that Senator Humphrey was discussing the situation where actual competition exists between the manufac-
turer-wholesaler and independent wholesalers. As indicated in note 15, supra, until we noted probable jurisdiction, appellee flatly disagreed with an important part of this statement.
18
122 F.Supp. at page 336.
19
Cf. Greenwood v. United States, 350 U.S. 366, 374, 76 S.Ct. 410, 414.
20
The Government maintains that a resale price maintenance agreement between a manufacturer-wholesaler and competing independent wholesalers, in addition to eliminating competition between the parties, enables the former, because of its leverage as a manufacturer of branded products, to dictate the latter's prices on these products. Such an agreement, the Government claims, also leaves the manufacturer-wholesaler free to undersell the independent wholesalers when dealing with large retailers directly through its manufacturing division. And if the manufacturer's own wholesale outlets are inefficient, resale price maintenance permits it to insulate those outlets from the inroads of more efficient operators by setting its 'fair trade' price higher than otherwise. According to the Government, none of these effects is present where price fixing exists between independent wholesalers and a nonintegrated manufacrurer.
Appellee contends that the economic effects of 'fair trading' are the same whether or not the manufacturer has its own wholesale outlets, since the protection which resale price maintenance provides to the manufacturer's good will 'necessarily involves elimination of price competition among different outlets for the manufacturer's own branded merchandise.' In both situations, appellee claims, the manufacturer makes 'at the source, as a manufacturer, * * * downstream price fixing arrangements with its outlets.'
The court below indicated an awareness of the economic arguments on both sides but refused to follow 'either of alternate horns * * * in the dilemma of fair trade agreements with independent wholesalers by a manufacturer who is also a wholesaler * * *.' 122 F.Supp. at page 337. Instead, the district judge advocated a case-by-case examination of the economic setting in which the question arises, with the burden on the Government to show 'some additional restraint destructive of competition.' 122 F.Supp. at page 339.
For discussion of these economic contentions and the conclusions which they are designed to support, see Weston, Resale Price Maintenance and Market Intergration: Fair Trade or Foul Play? 22 Geo.Wash.L.Rev. 658; Note, 64 Yale L.J. 426; 54 Col.L.Rev. 282.
1
The Court refers to the Miller-Tydings Act as having been 'passed as a rider to a District of Columbia, revenue bill.' It is pertinent to note that, in passing the later McGuire Act, Congress not only reaffirmed the policy of the Miller-Tydings Act but also eliminated the restrictive effect of this Court's decision in Schwegmann Bros. v. Calvert Distillers Corp., 341 U.S. 384, 71 S.Ct. 745, 95 L.Ed. 1035, as regards 'non-signers' of fair-trade contracts.
2
The Federal Trade Commission, the administrative agency specially charged with administering the McGuire Act, has reached like conclusions. See Eastman Kodak Co., 3 CCH Trade Reg.Rep. (10th ed.), par. 25, 291.
| 78
|
351 U.S. 513
76 S.Ct. 912
100 L.Ed. 1377
George B. PARR, Petitioner,v.UNITED STATES of America. George B. PARR, Petitioner, v. Ben H. RICE. George B. PARR v. Ben H. RICE. George B. PARR v. ALLRED.
No. 320 and No. 202 Misc.
Argued March 28, 1956.
Decided June 11, 1956.
Messrs.
Everett L. Looney, Austin, Tex., Abe Fortas, Washington, D.C., for petitioner.
Mr.Gray Thoron, Washington, D.C., for respondent.
Opinion of the Court by Mr. Justice HARLAN, announced by Mr. Justice BURTON.
1
In November 1954 petitioner was indicted in the Corpus Christi Division of the United States District Court for the Southern District of Texas, 17 F.R.D. 512, 519, for willfully attempting to evade federal income taxes by filing false returns for the years 1949, 1950 and 1951.1 In April 1955 the District Court granted petitioner's motion to transfer the case to the Laredo Division of the Southern District, finding that petitioner, a prominent political figure, could not obtain a fair trial in the Corpus Christi Division because of local prejudice against him.2 Deeming itself without power to transfer the case elsewhere than Laredo without the defendant's consent,3 the District Court also found against the Government's claim that it would or might under 'a severe handicap' in trying the petitioner in Laredo.4
2
Shortly thereafter, on May 3, 1955, the Government obtained a new indictment against petitioner in the Austin Division of the Western District of Texas for the same offenses.5 The next day it moved in the Corpus Christi Division for leave to dismiss the first indictment.6 This motion was granted over the vigorous opposition of the petitioner, and an order of dismissal was entered.7 Petitioner appealed to the Court of Appeals and, on the Government's motion, that court (one judge dissenting) dismissed the appeal upon the ground that the order appealed from was not a final order. 225 F.2d 329. We granted certiorari, directing that the case be heard both on the merits and on the question of appealability. 350 U.S. 861, 76 S.Ct. 106. Since we conclude that the order in question was not appealable, we do not reach the merits.
3
1. If the Corpus Christi indictment, is viewed in isolation from the Austin indictment an appeal from its dismissal will not lie because petitioner has not been aggrieved. Only one injured by the judgment sought to be reviewed can appeal, and, regarding the Corpus Christi proceeding as a separate prosecution, petitioner has not been injured by its termination in his favor. Lewis v. United States, 216 U.S. 611, 30 S.Ct. 438, 54 L.Ed. 637.8 So far as petitioner's standing to appeal is concerned, it makes no difference whether the dismissal still leaves him open to further prosecution, or whether, as petitioner contends, it bars his prosecution elsewhere than in Laredo because the transfer order operated to give him a vested right to be tried only there. Thetesting of the effect of the dismissal order must abide petitioner's trial, and only then, if convicted, will he have been aggrieved. Cf. Heike v. United States, 217 U.S. 423, 30 S.Ct. 539, 54 L.Ed. 821.9
4
2. If the Corpus Christi and Austin indictments be viewed together as parts of a single prosecution, petitioner fares no better. For then the order dismissing the Corpus Christi indictment would not be a final order. The considerations underlying the historic requirement of 'finality' in federal appellate procedure require no elaboration at this late date. See Cobbledick v. United States, 309 U.S. 323, 60 S.Ct. 540, 84 L.Ed. 783. In general, a 'judgment' or 'decision' is final for the purpose of appeal only 'when it terminates the litigation between the parties on the merits of the case, and leaves nothing to be done but to enforce by execution what has been determined.' St. Louis, Iron Mountain & Southern R. Co. v. Southern Express Co., 108 U.S. 24, 28, 2 S.Ct. 6, 8, 27 L.Ed. 638. This rule applies in criminal as well as civil cases. Berman v. United States, 302 U.S. 211, 212—213, 58 S.Ct. 164, 165—166, 82 L.Ed. 204.
5
It is argued that the order dismissing the Corpus Christi indictment was 'final because it (a) terminated the prosecution under that indictment, and (b) cannot be reviewed otherwise than upon this appeal. We think neither point well taken. 'Final judgment in a criminal case means sentence. The sentence is the judgment.' Berman v. United States, supra, 302 U.S. at page 212, 58 S.Ct. at page 166. And viewing the two indictments together as a single prosecution, the Austin indictment being as it were a superseding indictment, petitioner has not yet been tried, much less convicted and sentenced. The order dismissing the Corpus Christi indictment was but an interlocutory step in this prosecution, and its review must await the conclusion of the 'whole matter litigated' between the Government and the petitioner namely, 'the right to convict the accused of the crime charged in the indictment.' Heike v. United States, supra, 217 U.S. at page 429, 30 S.Ct. at page 541.
6
Nor is there substance to the claim that the Corpus Christi dismissal will not be reviewable if petitioner is convicted under the Austin indictment. If petitioner is correct in his contention that the Laredo transfer precluded the Government from proceeding elsewhere, he could not be tried in Austin, and, if petitioner preserves the point, he will certainly be entitled to have the Corpus Christi dismissal reviewed upon an appeal from a judgment of conviction under the Austin indictment. To hold this order 'final' at this stage of the prosecution would defeat the long-standing statutory policy against piecemeal appeals.
7
3. We also find untenable petitioner's secondary contention that, even if not final, the Corpus Christi dismissal falls within the exceptions to the rule of 'finality' recognized by this Court in such cases as Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 69 S.Ct. 1221, 93 L.Ed. 1528, and Swift & Company Packers v. Compania Columbiana del Caribe, 339 U.S. 684, 70 S.Ct. 861, 94 L.Ed. 1206. In those cases, orders made during the course of a litigation were held appealable because they related to matters outside the stream of the main action and would not be subject to effective review as part of the final judgment in the action. Unlike the orders in those cases, this order was but a 'step toward final disposition of the merits of the case' and will 'be merged in the final judgment.' Cohen v. Beneficial Industrial Loan Corp., supra, 337 U.S. at page 546, 69 S.Ct. at page 1225. The lack of an appeal now will not 'deny effective review of a claim fairly severable from the context of a larger litigious process.' Swift & Company Packers v. Compania Columbiana del Caribe, supra, 339 U.S. at page 689, 70 S.Ct. at page 865. True, the petitioner will have to hazard a trial under the Austin indictment before he can get a review of whether he should have been tried in Laredo under the Corpus Christi indictment, but 'bearing the discomfiture and cost of a prosecution for crime even by an innocent person is one of the painful obligations of citizenship.' Cobbledick v. United States, supra, 309 U.S. at page 325, 60 S.Ct. at page 541.
8
4. With his petition for certiorari, petitioner also filed a motion, Docket No. 202, Misc., for leave to file an original petition in this Court for writs of mandamus and prohibition to the Southern and Western District Courts, designed to require petitioner's trial in Laredo.10 Although this application has stood in abeyance pending determination of the questions involved on the writ of certiorari, it is appropriate to dispose of it now, it having been fully argued in the present proceeding.
9
We think that extraordinary writs should not issue. Such writs may go only in aid of appellate jurisdiction. 28 U.S.C. § 1651, 28 U.S.C.A. § 1651. The power to issue them is discretionary and it is sparingly exercised. Rule 30 of the Revised Rules of this Court, 28 U.S.C.A. and the cases cited therein. This is not a case where a court has exceeded or refused to exercise its jurisdiction, see Roche v. Evaporated Milk Ass'n, 319 U.S. 21, 26, 63 S.Ct. 938, 941, 87 L.Ed. 1185, nor one where appellate review will be defeated if a writ does not issue, cf. State of Maryland v. Soper, 270 U.S. 9, 29—30, 46 S.Ct. 185, 189, 70 L.Ed. 449. Here the most that could be claimed is that the district courts have erred in ruling on matters within their jurisdiction. The extraordinary writs do not reach to such cases; they may not be used to thwart the congressional policy against piecemeal appeals. Roche v. Evaporated Milk Ass'n, supra, 319 U.S. at page 30, 63 S.Ct. at page 943.
10
We conclude that the Court of Appeals properly dismissed the appeal, and its judgment must be affirmed.
11
Affirmed.
12
The motion for leave to file a petition for writs of mandamus and prohibition in No 202, Misc., is denied.
13
Denied.
14
Mr. Chief Justice WARREN, with whom Mr. Justice BLACK, Mr. Justice DOUGLAS and Mr. Justice CLARK join, dissenting.
15
The petitioner, Parr, was indicted for income tax evasion in the United States District Court at Corpus Christi, Texas. He asked and obtained a transfer of the proceeding to Laredo, Texas, on the ground that he could not obtain a fair and impartial trial in Corpus Christi. The Government was dissatisfied with the transfer but had no right under law to ask that the case be transferred to some other district. In this situation, the Government conceived the idea of having Parr indicted at Austin, Texas, thereafter dismissing the case against him in Laredo. Parr protested on the ground that he had a right to be tried, if at all, in Laredo, the place where the District Court had already determined a fair trial court be obtained. His protest was overruled. Parr then appealed to the Court of Appeals. That court dismissed the appeal on the ground that there was no final appealable judgment under 28 U.S.C. § 1291, 28 U.S.C.A. § 1291. The Court today affirms that holding without reaching the merits of the District Court's action in dismissing the indictment. We think the judgment is appealable under § 1291 and that it was error for the District Court to dismiss the case in Laredo.
16
The dismissal of the indictment, if valid, was a 'final' decision of the Laredo Court in that case. This is true even if a new indictment could be obtained in the Laredo District Court or in some other court. In fact, a new indictment was obtained in the Austin District Court before the Laredo Court dismissed the indictment in this case. But this new indictment made the dismissal of the Laredo indictment against Parr no less 'final.' For the Laredo case, after dismissal, did not remain 'open, unfinished or inconclusive'; nor was the decision dismissing it 'tentative, informal or incomplete.' Cohen v. Beneficial Loan Corp., 337 U.S. 541, 546, 69 S.Ct. 1221, 1225. There was nothing interlocutory about the dismissal. It was not simply an indecisive step in the course of a case which might ultimately result in conviction of Parr. For if Parr is to be convicted on the charge made in the Laredo indictment, it will have to come from the institution of a new case. The time for Parr to appeal from the dismissal of this case against him in Laredo, if ever, was after its 'final' disposition by the judge at Laredo. It would appear to be almost a fantastic interpretation of 'finality' to hold otherwise.
17
The majority contend that, even if the dismissal had the requisite finality, petitioner may not appeal it because he was not aggrieved thereby, relying upon Lewis v. United States, 216 U.S. 611, 30 S.Ct. 438, 54 L.Ed. 637. But that case should not control here, since no new indictment had been returned against Lewis before or after the dismissal of the indictment he sought to have reviewed, and an applicable statute of limitations barred any further effort to indict him. Here, a new indictment was returned against petitioner before the dismissal. If he had, as we believe he had, a right to be tried in Laredo or not at all, clearly he was aggrieved by the dismissal under the circumstances.
18
It seems to be intimated, however, that Parr might be able to raise the question somehow after trial at Austin if he should be convicted in the new and different case brought there. This Court can write law to that effect. We do not think it should. We countenance plain harassment if we require Parr to be tried under what may turn out to be an invalid indictment at Austin before he can obtain appellate review of dismissal of the Laredo case. Should this occur, Parr would have been required to undergo two trials, one at Austin and another at Laredo. Section 1291 should not be construed so as to bring about such a result.
19
We think it was error for the District Court at Laredo to dismiss the case there. Rule 21 of the Federal Rules of Criminal Procedure allows defendants to obtain changes of venue in order to get fair and impartial trial. No rule or statute grants such a privilege to the United States. The Government can and probably frequently does shop around to find a court it deems most favorable to try defendants. Here, the Government selected Corpus Christi as the forum in which to prosecute Parr, although, for the last 20 years preceding, the Government had filed all tax-evasion cases arising in that district in Austin. Here, after the Government's choice for trial was found by the District Court to be unfair to the defendant, and Laredo was found to provide a fair place for trial, the Government is being allowed to frustrate the court's selection of Laredo by filing a new indictment in a new case in Austin. We think the Government should not be allowed to circumvent the court's order in that fashion. Rule 21(c) provides that, after transfer under the rule, 'the prosecution shall continue' in the place to which the case has been transferred. There is no finding of any kind that the Government will not get a fair trial at Laredo. The finding was expressly to the contrary. The specific purpose of Rule 21 is to have trials that can be fair and impartial. The object of the Government here is to escape from a court where it has been decided after a full hearing that a fair and impartial trial will be given. There is no reason that we can see why Rule 21 should not be given its full effect by requiring trials, to take place in the district court to which it has been removed in the interest of fairness. We would reverse this case.
1
Section 145(b) of the Internal Revenue Code of 1939, 53 Stat. 62, 26 U.S.C.A. § 145(b).
2
Fed.Rules Crim.Proc. rule 21, 18 U.S.C.A.:
(a) 'The court upon motion of the defendant shall transfer the proceeding as to him to another district or division if the court is satisfied that there exists in the district or division where the prosecution is pending so great a prejudice against the defendant that he cannot obtain a fair and impartial trial in that district or division.
'c) 'When a transfer is ordered the clerk shall transmit to the clerk of the court to which the proceeding is transferred all papers in the proceeding or duplicates thereof and any bail taken, and the prosecution shall continue in that district or division.'
3
Petition's motion sought a transfer solely to Laredo. In his brief before the District Court, he stated: 'We wish to be clearly understood that if the case is not to be transferred to Laredo we prefer that it remain in Corpus Christi.'
4
17 F.R.D. 512, 518—520. This opinion is illuminated by the later remarks of the same judge quoted in note 7.
5
The Austin indictment differed from the Corpus Christi indictment only in its allegations as to venue. Under 18 U.S.C. § 3237, 18 U.S.C.A. § 3237, petitioner was indictable both in the Western District (where his returns were filed) and in the Southern District (where the returns were prepared and forwarded for filing).
6
Fed.Rules Crim.Proc. rule 48(a):
'The Attorney General or the United States attorney may by leave of court file a dismissal of an indictment, information or complaint and the prosecution shall thereupon terminate. Such a dismissal may not be filed during the trial without the consent of the defendant.'
7
The petitioner opposed the motion on the ground that it was an attempt to circumvent the District Court's prior order transferring the case to Laredo. It is clear that the principal purpose of the Government in obtaining the Austin indictment was to avoid a trial in Laredo, which it regarded as 'defendant's seat of political power,' and that this purpose was made manifest to District Judge Kennerly who (together with Judge Allred) had acted on petitioner's earlier transfer application. In granting the motion to dismiss, Judge Kennerly stated:
'I reached the conclusion (upon petitioner's earlier motion to transfer the case to Laredo) that the case should not be tried in Corpus Christi, and that defendant's motion for change of venue should be granted.
'In reaching that conclusion, or rather in examining the record, I reached this further conclusion, that I gravely doubted whether in the administration of justice generally, the case should be tried in this district at al. * * *
'But when I came to examine the law, I found that I was without
power to transfer the case outside of the Southern District of Texas. * * * If I had had that authority I would have sent it to Amarillo, or Sherman, or Texarkana, or some of those places as far removed from the scene of the troubles as I could, or as I could find. I would have done that not, as I say, to favor either the defendant or the Government, because I feel that justice in the case would be best administered by transferring the case to one of those places.
'But as stated, I could not do that as I understand the law. I then discovered that I could not transfer the case to any other division of the district except Laredo. * * * (S)o the case was transferred there.
'Now we come to this motion by the Government to dismiss the case because of the fact that a new indictment covering the same matter has been presented in the Western District. * * *
'* * * evidently there is some discretion in the Court as to the matter of whether the case should or should not be dismissed.
'In twenty-four years on the bench in this district, I do not recall ever having at any time hesitated to dismiss a case when requested by the Government. That was of course under the old law, and under the present rules (sic). If I have a discretion under the rules now as to whether this case should or should not be dismissed, I must exercise that discretion and allow it to be dismissed, because I do not think that the defendant, either in the hearing this morning or in this enormous record on the question of change of venue, has shown any reasons why the case should not be dismissed.'
8
It is suggested that the defendant in Lewis was held not to be aggrieved only because the statute of limitations prevented his reindictment. The Court alluded to that circumstance, however, only after holding that the defendant could not be 'legally aggrieved' by being released from prosecution under the indictment; the bar of the statute of limitations was noted only in connection with a concluding observation that the case was moot in any event.
9
To support his claim of aggrievement, petitioner, by way of analogy, relies upon four lower court decisions granting appeals from judgments of nonsuit in civil cases. In three of the cases, however, the defendant was asserting a right to a judgment in his favor on the merits, claimed to have been fully established prior to the nonsuit, and was obviously aggrieved by the loss of that judgment. Connecticut Fire Ins. Co. v. Manning, 8 Cir., 177 F. 893; Massachusetts Fire & Marine Ins. Co. v. Schmick, 8 Cir., 58 F.2d 130; Iowa-Nebraska L. & P. Co. v. Daniels, 8 Cir., 63 F.2d 322. In the fourth case, Cybur Lumber Co. v. Erkhart, 5 Cir., 247 F. 284, the plaintiff took a nonsuit only after a previous verdict in his favor had been reversed on appeal and the case had been remanded for a new trial with directions to direct a verdict for the defendant if the evidence was the same; the defendant claimed a right to a judgment if the plaintiff did not proceed to trial on the remand. In all of the cited cases, therefore, the defendant was asserting a right to a judgment on the basis of the progress of the action prior to the nonsuit—a substantial right going to the merits of the controversy of which he had been deprived by the nonsuit. No such circumstances are present here. Cf. Fed.Rules Crim.Proc. rule 48(a): '* * * Such a dismissal may not be filed during the trial without the consent of the defendant.' (Emphasis added.)
10
Petitioner had also been denied writs of mandamus and prohibition in the Court of Appeals, and the writ of certiorari brought up that ruling as well as the dismissal of the appeal. The prerogative writs sought in the Court of Appeals, however, were designed solely to stay the proceedings in the Western District pending the final disposition of the appeal and not to afford permanent relief. Since the Western District Court subsequently granted the Government's motion for such a stay, that part of the case on certiorari is now moot. Thus it is only petitioner's original application to this Court in No. 202, Misc., that is before us.
| 89
|
351 U.S. 570
76 S.Ct. 974
100 L.Ed. 1415
Marie DE SYLVA, Petitioner,v.Marie BALLENTINE, as Guardian of the Estate of Stephen William Ballentine.
No. 529.
Argued April 25, 1956.
Decided June 11, 1956.
Mr.
Theodore Kiendl, New York City, for petitioner.
Mr. Max Fink, Los Angeles, Cal., for respondent.
Opinion of the Court by Mr. Justice HARLAN, announced by Mr. Justice BURTON.
1
The present Copyright Act1 provides for a second 28-year copyright after the expiration of the original 28-year term, if application for renewal is made within one year before the expiration of the original term. This right to renew the copyright appears in § 24 of the Act:
2
'And provided further, That in the case of any other copyrighted work, * * * the author of such work, if still living, or the widow, widower, or children of the author, if the author be not living, or if such author, widow, widower, or children be not living, then the author's executors, or in the absence of a will, his next of kin shall be entitled to a renewal and extension of the copyright in such work for a further term of twenty-eight years when application for such renewal and extension shall have been made to the copyright office and duly registered therein within one year prior to the expiration of the original term of copyright * * *.'
3
In this case, an author who secured original copyright on numerous musical compositions died before the time to apply for renewals arose. He was survived by his widow and one illegitimate child, who are both still living. The question this case presents is whether that child is entitled to share in the copyrights which come up for renewal during the widow's lifetime.
4
Respondent, the child's mother, brought this action on the child's behalf against the widow, who is the petitioner here, seeking a declaratory judgment that the child has an interest in the copyrights already renewed by the widow and those that will become renewable during her lifetime, and for an accounting of profits from such copyrights as have been already renewed. The District Court, holding that the child was within the meaning of the term 'children' as used in the statute but that the renewal rights belonged exclusively to the widow, gave judgment for the widow. Agreeing with the District Court on the first point, the Court of Appeals reversed, holding that on the author's death both widow and child shared in the renewal copyrights. 226 F.2d 623. Because of the great importance of these questions in the administration of the Copyright Act, we granted certiorari, 350 U.S. 931, 76 S.Ct. 307.
5
The controversy centers around the words 'or the widow, widower, or children of the author, if the author be not living.' Two questions are involved: class, or in order of enumeration, and (2) class, or in order of enumeration, and (2) if they take as a class, does 'children' include an illegitimate child. Strangely enough, these questions have never before been decided, although the statutory provisions involved have been part of the Act in their present form since 1870.
6
* The widow first contends that, after the death of the author, she alone is entitled to renew copyrights during her lifetime, exclusive of any interest in 'children' of the author. That is, she interprets the clause as providing for the passing of the renewal rights, on the death of the author, first to the widow, and then only after her death to the 'children' of the author. If the word 'or' which follows 'widower' is to be read in its normal disjunctive sense, this is not an unreasonable interpretation of the statute, which might then well be read to mean that 'children' are to renew only if there is no 'widow' or 'widower.' The statute is hardly unambiguous, however, and presents problems of interpretation not solved by literal application of words as they are 'normally' used. The statute must be read as a whole, and putting each word in its proper context we are unable to say, as the widow contends we should, that the clear purport of the clause in question is the same as if it read 'or the widow, or widower, if the author be not living, or the children of the author, if the author, and widow or widower, be not living.'
7
We start with the proposition that the word 'or' is often used as a careless substitute for the word 'and'; that is, it is often used in phrases where 'and' would express the thought with greater clarity. That trouble with the word has been with us for a long time: see, e.g., United States v. Fisk, 3 Wall. 445, 18 L.Ed. 243. In this instance, we need look no further than the very next clause in this same section of the Copyright Act for an example of this careless usage: '* * * or if such author, widow, widower or children be not living, then the author's executors * * *.' If the italicized 'or' in that clause is read disjunctively, then the author's executors would be entitled to renew the copyright if any one of the persons named 'be not living.' It is clear, however, that the executors do not succeed to the renewal interest unless all of the named persons are dead, since from the preceding clause it is at least made explicit that the 'widow, widower, or children of the author' all come before the executors, after the author's death. The clause would be more accurate, therefore, were it to read 'author, widow or widower, and children.' It is argued with some force, then, that if in the secceeding clause the 'or' is to be read as meaning 'and' in the same word grouping as is involved in the clause in question, it should be read that way in this clause as well. If this is done, it is then an easy step to read 'widow' and 'children' as succeeding to the renewal interest as a class, as the Court of Appeals held they did.
8
This Court has already traced the development of the renewal term in the several copyright statutes enacted in this country. See Fred Fisher Music Co. v. M. Witmark & Sons, 318 U.S. 643, 63 S.Ct. 773, 87 L.Ed. 1055, where it was held that the author, during his lifetime, could make a binding assignment of the expectancy in his future rights of renewal. The first federal statute, the Act of May 31, 1790, 1 Stat. 124, did not allow renewal by anyone except the author. In 1831, however, a new Act was passed, which for the first time gave to the author's family the right to renew after his death. Act of February 3, 1831, 4 Stat. 436. Section 2 of that Act provided:
9
'That if, at the expiration of the aforesaid term of years, such author * * * be still living, and a citizen * * * of the United States, or resident therein, or being dead, shall have left a widow, or child, or children, either or all then living, the same exclusive right shall be continued to such author * * *, or, if dead, then to such widow and child, or children, for the further term of fourteen years * * *.' (Italics supplied.)
10
It is significant that this statute, which instituted the present scheme of allowing a copyright to be renewed after the author's death, provided for the renewal interest in the 'widow and child, or children,' rather than in the widow or children separately. Petitioner concedes that under this statute the widow and children took as a class. This statute marked a major development in this phase of copyright legislation and created a system which, in its basic form, has been continued even to the present statute.
11
Section 88 of the Act of July 8, 1870, 16 Stat. 212, in consolidating the language of § 2 of the 1831 Act, made one important change in the language of the renewal section: the right of renewal was given to the author's widow or children, rather than to the widow and children. The section read as follows:
12
'That the author, * * * if he be still living and a citizen of the United States or resident therein, or his widow or children, if he be dead, shall have the same exclusive right continued for the further term of fourteen years * * *.' (Italics supplied.)
13
This section became § 4954 of the Revised Statutes, and was amended in 1891, 26 Stat. 1107, by deleting the requirement that the author be a citizen or resident of the United States. The section was otherwise left intact. The present renewal provision appeared first as § 23 of the Copyright Act of March 4, 1909, 35 Stat. 1080, and was continued without change in 17 U.S.C. § 24, 17 U.S.C.A. § 24.
14
Knowing, as we do, that 'or' can be ambiguous when used in such a context as this, it is difficult to say that the change made in the 1870 Copyright Act had the effect of changing, as petitioner contends it did, the children's interest from an interest shared with the widow to one which became effective only after her death. There is no legislative history, either when the 1870 Act was passed or in the subsequent sessions of Congress, to indicate that Congress in fact intended to change in this respect the existing scheme of distribution of the renewal rights. Rather, what scant material there is indicates that no substantial changes in the Act were intended.2 It would not seem unlikely that the framers of the 1870 statute, interested in compressing the somewhat cumbersome phrasing of the prior Copyright Act, simply deleted the words 'and child' with the thought that the remaining phrase 'or children' expressed precisely the same result, leaving unaffected the rights of the author's children which had been the same for almost forty years.
15
We then come to the 1909 Copyright Act. By § 23 of that Act, now 17 U.S.C. § 24, 17 U.S.C.A. § 24, there were added to those entitled to renewal rights after the author's death—the widow or children—the author's executors, or, in the absence of a will, his next of kin. Each of these named classes is separated in the statute by a condition precedent to the passing of the renewal rights, namely, that the persons named in the preceding class be deceased. As already noted, it is at least clear that, if the author and his widow have both died, survived by a child, that child is entitled to renew copyrights maturing during his lifetime. But if this interest were to take effect only after the death of the widow, it might be expected that the drafters of the Act would have separated 'widow or widower' from 'children' with the same condition precedent used in defining the succession of the other classes to the renewal rights, since it would in effect be placing the children in a class lower than that occupied by the widow or widower. Granting that the absence of this structure might simply have been due to carelessness in adding the new class to the prior renewal section, we think it may nevertheless be taken as some indication that the widow and children are to take the right to renew at the same time.
16
The Solicitor General has filed a helpful brief on behalf of the Register of Copyrights, as amicus curiae, in which the administrative practice of the Copyright Office is discussed. It appears that the Regulations issued under the 1909 Act, in force until 1948 (when new Regulations, not touching on this point, were issued), allowed the children of the author to apply for copyright renewals after the author's death along with the widow or widower that is, the children were not treated as being entitled to renewal only after the death of the widow or widower.3 The practice of the Copyright Office has been to register renewal claims by children during the lifetime of an author's widow or widower, although this practice, it is frankly admitted, is more the result of a decision that there is substantial doubt over the question, rather than the result of a confident interpretation of the statute as treating widows, widowers, and children as members of one class. Although we would ordinarily give weight to the interpretation of an ambiguous statute by the agency charged with its administration, cf. Mazer v. Stein, 347 U.S. 201, 211—213, 74 S.Ct. 460, 467—468, 98 L.Ed. 630, we think the Copyright Office's explanation of its practice deprives the practice of any force as an interpretation of the statute, and we therefore do not rely on it in this instance.
17
Petitioner and several of the associations which have filed amicus briefs point out that the 'universal' interpretation of § 24 has been that children are entitled to renewal only after the death of the widow or widower. In light of the Copyright Office practice alone, that is obviously an overstatement. Nevertheless, had there been a long-standing consistent attitude by the specialists in this field of law, and a more adequate basis for it than exists here, we might hesitate to overturn what had come to be a generally accepted view of a statute having such important consequences. But we cannot escape the conclusion that, in this instance, any such reliance on that interpretation of the Act was misplaced: the statute is far from clear, the Copyright Office has recognized its ambiguity, renewal applications have for many years been filed by children before the death of the widow or widower, and more than one qualified commentator has either expressed doubt on the question or has concluded that the widow or widower and children take as a class.4
18
Nor is it possible for us to say, as petitioner suggests, that the only way to satisfy the congressional purpose is to hold that, during her lifetime, the widow has exclusive renewal rights. Petitioner argues that the statute, contemplating the normal situation of a widow taking care of her children, gives the widow exclusive control of the copyright on the author's death, since she is presumably more capable of dealing with it and will more likely be in need of the copyright income. This branch of the argument, however, becomes very much diluted when it is observed that, if the deceased author be a woman, the statute disposes of the renewal rights in the same manner as if the author were a male. It is further argued that since the value of the copyright depends to an appreciable extent on the ability to convey clear publication rights, the statute should not be construed to diminish the value of the copyright by scattering its ownership, which might make it difficult to transfer clear title. One difficulty with this argument is that it ignores the 1831 statute, which, as petitioner recognizes, divided the ownership of the renewal rights between the surviving spouse of the author and his children. What we are asked to do is to avoid, on policy grounds, an interpretation of the successor statute which embodies the policy of the earlier Act, a policy which Congress saw fit to effectuate at least until 1870, and which, if changed then, was changed without any discernible display of dissatisfaction with that policy. This is not the type of case where we can use, as a guide to statutory interpretation, an unwillingness to attribute to Congress results which on their face are harsh, or present constitutional difficulties, or which are so extraordinary that clear, unambiguous wording is required. Cf. United States v. Minker, 350 U.S. 179, 76 S.Ct. 281. In view of this explicit prior legislation, this Court should not transfuse the successor statute with a gloss of its own choosing, especially where the choice between the alternative policies is as close as this one.5
19
While the matter is far from clear, we think, on balance, the more likely meaning of the statute to be that adopted by the Court of Appeals, and we hold that, on the death of the author, the widow and children of the author succeed to the right of renewal as a class, and are each entitled to share in the renewal term of the copyright.
II
20
We come, then, to the question of whether an illegitimate child is included within the term 'children' as used in § 24. The scope of a federal right is, of course, a federal question, but that does not mean that its content is not to be determined by state, rather than federal law. Cf. Reconstruction Finance Corp. v. Beaver County, 328 U.S. 204, 66 S.Ct. 992, 90 L.Ed. 1172; Board of County Commissioners v. United States, 308 U.S. 343, 351—352, 60 S.Ct. 285, 288—289, 84 L.Ed. 313. This is especially true where a statute deals with a familial relationship; there is no federal law of domestic relations, which is primarily a matter of state concern.
21
If we look at the other persons who, under this section of the Copyright Act, are entitled to renew the copyright after the author's death, it is apparent that this is the general scheme of the statute. To decide who is the widow or widower of a deceased author, or who are his executors or next of kin, requires a reference to the law of the State which created those legal relationships. The word 'children,' although it to some extent describes a purely physical relationship, also describes a legal status not unlike the others. To determine whether a child has been legally adopted, for example, requires a reference to state law. We think it proper, therefore, to draw on the ready-made body of state law to define the word 'children' in § 24. This does not mean that a State would be entitled to use the word 'children' in a way entirely strange to those familiar with its ordinary usage, but at least to the extent that there are permissible variations in the ordinary concept of 'children' we deen state law controlling. Cf. Seaboard Air Line Railway v. Kenney, 240 U.S. 489, 36 S.Ct. 458, 60 L.Ed. 762.6
22
This raises two questions: first, to what State do we look, and second, given a particular State, what part of that State's law defines the relationship. The answer to the first question, in this case, is not difficult, since it appears from the record that the only State concerned is California, and both parties have argued the case on that assumption. The second question, however, is less clear. An illegitimate child who is acknowledged by his father, by a writing signed in the presence of a witness, is entitled under § 255 of the California Probate Code7 to inherit his father's estate as well as his mother's. The District Court found that the child here was within the terms of that section. Under California law the child is not legitimate for all purposes, however; compliance with § 230 of the Civil Code8 is necessary for full legitimation, and there are no allegations in the complaint sufficient to bring the child within the section. Hence, we may take it that the child is not 'adopted' in the sense that he is to be regarded as a legitimate child of the author.
23
Considering the purposes of § 24 of the Copyright Act, we think it sufficient that the status of the child is that described by § 255 of the California Probate Code. The evident purpose of § 24 is to provide for the family of the author after his death. Since the author cannot assign his family's renewal rights, § 24 takes the form of a compulsory bequest of the copyright to the designated persons. This is really a question of the descent of property, and we think the controlling question under state law should be whether the child would be an heir of the author. It is clear that under § 255 the child is, at least to that extent, included within the term 'children.'
24
Finally, there remains the question of what are the respective rights of the widow and child in the copyright renewals, once it is accepted that they both succeed to the renewals as members of the same class. Since the parties have not argued this point, and neither court below has passed on it, we think it should not be decided at this time.
25
For the foregoing reasons, the judgment of the Court of Appeals is affirmed.
26
Affirmed.
27
Mr. Justice DOUGLAS, with whom Mr. Justice BLACK joins, concurring.
28
The meaning of the word 'children' as used in § 24 of the Copyright Act is a federal question. Congress could of course give the word the meaning it has under the laws of the several States. See Hutchinson Investment Co. v. Caldwell, 152 U.S. 65, 68—69, 14 S.Ct. 504, 505; Poff v. Pennsylvania R. Co., 327 U.S. 399, 401, 66 S.Ct. 603, 90 L.Ed. 749. But I would think the statutory policy of protecting dependents would be better served by uniformity, rather than by the diversity which would flow from incorporating into the Act the laws of forty-eight States. Cf. Clearfield Trust Co. v. United States, 318 U.S. 363, 367, 63 S.Ct. 573, 575, 87 L.Ed. 838; National Metropolitan Bank v. United States, 323 U.S. 454, 456, 65 S.Ct. 354, 355, 89 L.Ed. 383; Heiser v. Woodruff, 327 U.S. 726, 732, 66 S.Ct. 853, 855, 90 L.Ed. 970; United States v. Standard Oil Co., 332 U.S. 301, 307, 67 S.Ct. 1604, 91 L.Ed. 2067.
29
An illegitimate child was given the benefits of the Federal Death Act, 46 U.S.C.A. § 761 et seq., by Middleton v. Luckenbach S.S. Co., 70 F.2d 326, 329—330, where the Court of Appeals for the Second Circuit said:
30
'There is no right of inheritance involved here. It is a statute that confers recovery upon dependents, not for the benefit of an estate, but for those who by our standards are legally or morally entitled to support. Humane considerations and the realization that children are such no matter what their origin alone might compel us to the construction that, under present day conditions, our social attitude warrants a construction different from that of the early English view. The purpose and object of the statute is to continue the support of dependents after a casualty. To hold that these children or the parents do not come within the terms of the act would be to defeat the purposes of the act. The benefit conferred beyond being for such beneficiaries is for society's welfare in making provision for the support of those who might otherwise become dependent. The rule that a bastard is nullius filius applies only in cases of inheritance. Even in that situation was have made very considerable advances toward giving illegitimates the right of capacity to inherit by admitting them to possess inheritable blood.'
31
I would take the same approach here and, regardless of state law, hold that illegitimate children were 'children' within the meaning of § 24 of the Copyright Act, whether or not state law would allow them dependency benefits.
32
With this exception, I join in the opinion of the Court.
1
61 Stat. 652, 17 U.S.C. § 1 et seq., 17
2
See Cong.Globe, 41st Cong., 2d Sess. 2680, 2854 (1870).
3
37 CFR, 1938, § 201.24(a): 'Application for the renewal of a subsisting copyright may be filed within 1 year prior to the expiration of the existing term by:
'(1) The author of the work if still living;
'(2) The widow, widower, or children of the author if the author is not living;
'(3) The author's executor, if such author, widow, widower, or children be not living;
'(4) If the author, widow, widower, and children are all dead, and the author left no will, then the next of kin.'
See § 48, Copyright Office Bulletin No. 15 (1913); § 46, Copyright Office Bulletin No. 15 (1910).
4
See, e.g., Chafee, Reflections on the Law of Copyright, 45 Col.L.Rev. 503, 527; Kupferman, Renewal of Copyright—Section 23 of the Copyright Act of 1909, 44 Col.L.Rev. 712, 717; Tannenbaum, Practical Problems in Copyright, 7 Copyright Problems Analyzed (CCH) 7, 12 (1952). But see, e.g., Nicholson, A Manual of Copyright Practice, 195, 196; De Wolf, An Outline of Copyright Law, 66.
5
Petitioner also argues that since the statute does not specifically provide for an allocation, as between the widow or widower and children, of their respective interests in the renewal copyrights, it should not be read as providing for their succeeding to the renewal rights as a class. But neither did the 1831 Act provide for a division of the copyright between widow and child or children; nor does the present Act allocate the renewal rights as between those included in the term 'next of kin.' The absence of such a provision, therefore, is not persuasive as an aid to interpretation of the statute.
6
Petitioner relies on McCool v. Smith, 1 Black 459, 17 L.Ed. 218 for the proposition that a general statutory reference to 'children' means only legitimate children. The actual decision in that case, decided in 1862, concerned only the interpretation of a state statute, and we do not consider it controlling here. Cf. Hutchinson Investment Co. v. Caldwell, 152 U.S. 65, 70, 14 S.Ct. 504, 505, 38 L.Ed. 356.
7
'Every illegitimate child is an heir of his mother, and also of the person who, in writing, signed in the presence of a competent witness, acknowledges himself to be the father, and inherits his or her estate, in whole or in part, as the case may be, in the same manner as if he had been born in lawful wedlock; but he does not represent his father by inheriting any part of the estate of the father's kindred, either lineal or collateral, unless, before his death, his parents shall have intermarried, and his father, after such marriage, acknowledges him as his child, or adopts him into his family; in which case such child is deemed legitimate for all purposes of succession. An illegitimate child may represent his mother and may inherit any part of the estate of the mother's kindred, either lineal or collateral.'
8
'The father of an illegitimate child, by publicly acknowledging it as his own, receiving it as such, with the consent of his wife, if he is married, into his family, and otherwise treating it as if it were a legitimate child, thereby adopts it as such; and such child is thereupon deemed for all purposes legitimate from the time of its birth. The foregoing provisions of this Chapter do not apply to such an adoption.'
| 78
|
351 U.S. 377
76 S.Ct. 994
100 L.Ed. 1264
UNITED STATES of America, Appellant,v.E. I. DU PONT DE NEMOURS AND CO.
No. 5.
Argued Oct. 11, 1955.
Decided June 11, 1956.
Mr.Charles H. Weston, Washington, D.C., for appellant.
Mr. Gerhard A. Gesell, Washington, D.C., for appellee.
Mr. Justice REED delivered the opinion of the Court.
1
The United States brought this civil action under § 4 of the Sherman Act against E. I. du Pont de Nemours and Company. The complaint, filed December 13, 1947, in the United States District Court for the District of Columbia, charged du Pont with monopolizing, attempting to monopolize and conspiracy to monopolize interstate commerce in cellophane and cellulosic caps and bands in violation of § 2 of the Sherman Act. Relief by injunction was sought against defendant and its officers, forbidding monopolizing or attempting to monopolize interstate trade in cellophane. The prayer also sought action to dissipate the effect of the monopolization by divestiture or other steps. On defendant's motion under 28 U.S.C. § 1404(a), 28 U.S.C.A. § 1404(a), the case was transferred to the District of Delaware. After a lengthy trial, judgment was entered for du Pont on all issues.1
2
The Government's direct appeal here does not contest the findings that relate to caps and bands, nor does it raise any issue concerning the alleged attempt to monopolize or conspiracy to monopolize interstate commerce in cellophane. The appeal, as specifically stated by the Government, 'attacks only the ruling that du Pont has not monopolized trade in cellophane.' At issue for determination is only this alleged violation by du Pont of § 2 of the Sherman Act.2
3
During the period that is relevant to this action, du Pont produced almost 75% of the cellophane sold in the United States, and cellophane constituted less than 20% of all 'flexible packaging material' sales. This was the designation accepted at the trial for the materials listed in Finding 280, Appendix A, this opinion, 76 S.Ct. 1012.
4
The Government contends that, by so dominating cellophane production, du Pont monopolized a 'part of the trade or commerce' in violation of § 2. Respondent agrees that cellophane is a product which constitutes 'a 'part' of commerce within the meaning of Section 2.' Du Pont brief, pp. 16, 79. But it contends that the prohibition of § 2 against monopolization is not violated because it does not have the power to control the price of cellophane or to exclude competitors from the market in which cellophane is sold. The court below found that the 'relevant market for determining the extent of du Pont's market control is the market for flexible packaging materials,' and that competition from those other materials prevented du Pont from possessing monopoly powers in its sales of cellophane. Finding 37.
5
The Government asserts that cellophane and other wrapping materials are neither substantially fungible nor like priced. For these reasons, it argues that the market for other wrappings is distinct from the market for cellophane and that the competition afforded cellophane by other wrappings is not strong enough to be considered in determining whether du Pont has monopoly powers. Market delimitation is necessary under du Pont's theory to determine whether an alleged monopolist violates § 2. The ultimate consideration is such a determination is whether the defendants control the price and competition in the market for such part of trade or commerce as they are charged with monopolizing. Every manufacturer is the sole producer of the particular commodity it makes but its control in the above sense of the relevant market depends upon the availability of alternative commodities for buyers: i.e., whether there is a cross-elasticity of demand between cellophane and the other wrappings. This interchangeability is largely gauged by the purchase of competing products for similar uses considering the price, characteristics and adaptability of the competing commodities. The court below found that the flexible wrappings afforded such alternatives. This Court must determine whether the trial court erred in its estimate of the competition afforded cellophane by other materials.
6
The burden of proof, of course, was upon the Government to establish monopoly. See United States v. Aluminum Co. of America, 2 Cir., 148 F.2d 416, 423, 427. This the trial court held the Government failed to do, upon findings of fact and law stated at length by that court. For the United States to succeed in this Court now, it must show that erroneous legal tests were applied to essential findings of fact or that the findings themselves were 'clearly erroneous' within our rulings on Rule 52(a) of the Rules of Civil Procedure, 28 U.S.C.A. See United States v. UnitedStates Gypsum Co., 333 U.S. 364, 393—395, 68 S.Ct. 525, 541, 92 L.Ed. 746. We do not try the facts of cases de novo. Timken Roller Bearing Co. v. United States, 341 U.S. 593, 597, 71 S.Ct. 971, 974, 95 L.Ed. 1199.3
7
Two additional questions were raised in the record and decided by the court below. That court found that, even if du Pont did possess monopoly power over sales of cellophane, it was not subject to Sherman Act prosecution, because (1) the acquisition of that power was protected by patents, and (2) that power was acquired solely through du Pont's business expertness. It was thrust upon du Pont. 118 F.Supp. at pages 213—218.
8
Since the Government specifically excludes attempts and conspiracies to monopolize from consideration, a conclusion that du Pont has no monopoly power would obviate examination of these last two issues.
9
I. Factual Background.—For consideration of the issue as to monopolization, a general summary of the development of cellophane is useful.
10
In the early 1900's, Jacques Brandenberger, a Swiss chemist, attempted to make tablecloths impervious to dirt by spraying them with liquid viscose (a cellulose solution available in quantity from wood pulp, Finding 361) and by coagulating this coating. His idea failed, but he noted that the coating peeled off in a transparent film. This first 'cellophane' was thick, hard, and not perfectly transparent, but Brandenberger apparently foresaw commercial possibilities in his discovery. By 1908 he developed the first machine for the manufacture of transparent sheets of regenerated cellulose. The 1908 product was not satisfactory, but by 1912 Brandenberger was making a saleable thin flexible film used in gas masks. He obtained patents to cover the machinery and the essential ideas of his process.
11
It seems to be agreed, however, that the disclosures of these early patents were not sufficient to make possible the manufacture of commercial cellophane. The inadequacy of the patents is partially attributed to the fact that the essential machine (the Hopper) was improved after it was patented. But more significant was the failure of these patents to disclose the actual technique of the process. This technique included the operational data acquired by experimentation.4
12
In 1917 Brandenberger assigned his patents to La Cellophane Societe Anonyme and joined that organization. Thereafter developments in the production of cellophane somewhat paralleled those taking place in artificial textiles. Chemical science furnished the knowledge for perfecting the new products. The success of the artificial products has been enormous. Du Pont was an American leader in the field of synthetics and learned of cellophane's successes through an associate, Comptoir des Textiles Artificiel.
13
In 1923 du Pont organized with La Cellophane an American company for the manufacture of plain cellophane. The undisputed findings are that:
14
'On December 26, 1923, an agreement was executed between duPont Cellophane Company and La Cellophane by which La Cellophane licensed duPont Cellophane Company exclusively under its United States cellophane patents, and granted duPont Cellophane Company the exclusive right to make and sell in North and Central America under La Cellophane's secret processes for cellophane manufacture. DuPont Cellophane Company granted to La Cellophane exclusive rights for the rest of the world under any cellophane patents or processes duPont Cellophane Company might develop.' Finding 24.
15
Subsequently du Pont and La Cellophane licensed several foreign companies, allowing them to manufacture and vend cellophane in limited areas. Finding 601. Technical exchange agreements with these companies were entered into at the same time. However, in 1940, du Pont notified these foreign companies that sales might be made in any country,5 and by 1948 all the technical exchange agreements were canceled.
16
Sylvania, and American affiliate of a Belgian producer of cellophane not covered by the license agreements above referred to, began the manufacture of cellophane in the United States in 1930. Litigation between the French and Belgian companies resulted in a settlement whereby La Cellophane came to have a stock interest in Sylvania, contrary to the La Cellophane-du Pont agreement. This resulted in adjustments as compensation for the intrusion into United States of La Cellophane that extended du Pont's limited territory. The details do not here seem important. Since 1934 Sylvania has produced about 25% of United States cellophane.
17
An important factor in the growth of cellophane production and sales was the perfection of moistureproof cellophane, a superior product of du Pont research and patented by that company through a 1927 application. Plain cellophane has little resistance to the passage of moisture vapor. Moistureproof cellophane has a composition added which keeps moisture in and out of the packed commodity. This patented type of cellophane has had a demand with much more rapid growth than the plain.
18
In 1931 Sylvania began the manufacture of moistureproof cellophane under its own patents. After negotiations over patent rights, du Pont in 1933 licensed Sylvania to manufacture and sell moistureproof cellophane produced under the du Pont patents at a royalty of 2% of sales. These licenses with the plain cellophane licenses, from the Belgian company, made Sylvania a full cellophane competitor, limited on moistureproof sales by the terms of the licenses to 20% of the combined sales of the two companies of that type by the payment of a prohibitive royalty on the excess. Finding 552. There was never an excess production. The limiting clause was dropped on January 1, 1945, and Sylvania was acquired in 1946 by the American Viscose Corporation with assets of over two hundred million dollars.
19
Between 1928 and 1950, du Pont's sales of plain cellophane increased from $3,131,608 to $9,330,776. Moistureproof sales increased from $603,222 to $89,850,416, although prices were continuously reduced. Finding 337. It could not be said that this immense increase in use was solely or even largely attributable to the superior quality of cellophane or to the technique or business acumen of du Pont, though doubtless those factors were important. The growth was a part of the expansion of the commodity-packaging habits of business, a by-product of general efficient competitive merchandising to meet modern demands. The profits, which were large, apparently arose from this trend in marketing, the development of the industrial use of chemical research and production of synthetics, rather than from elimination of other producers from the relevant market. That market is discussed later at 76 S.Ct. 1006. Tables appearing at the end of this opinion (Appendix A, Findings 279—292, inclusive, 76 S.Ct. 1012—1014) show the uses of cellophane in comparison with other wrappings.6 See the discussion, infra, 76 S.Ct. 1009 et seq.
20
II. The Sherman Act and the Courts.—The Sherman Act has received long and careful application by this Court to achieve for the Nation the freedom of enterprise from monopoly or restraint envisaged by the Congress that passed the Act in 1890. Because the Act is couched in broad terms, it is adaptable to the changing types of commercial production and distribution that have evolved since its passage. Chief Justice Hughes wrote for the Court that 'As a charter of freedom, the act has a generality and adaptability comparable to that found to be desirable in constitutional provisions.' Appalachian Coals, Inc., v. United States, 288 U.S. 344, 359—360, 53 S.Ct. 471, 474, 77 L.Ed. 825. Compare on remedy, Judge Wyzanski in United States v. United Shoe Machinery Corp., D.C., 110 F.Supp. 295, 348. It was said in Standard Oil Co. of New Jersey v. United States, 221 U.S. 1, 50, 31 S.Ct. 502, 511, 55 L.Ed. 619, that fear of the power of rapid accumulations of individual and corporate wealth from the trade and industry of a developing national economy caused its passage. Units of traders and producers snowballed by combining into so-called 'trusts.' Competition was threatened. Control of prices was feared. Individual initiative was dampened. While the economic picture has changed, large aggregations or private capital, with power attributes, continue. Mergers go forward. Industries such as steel, automobiles, tires, chemicals, have only a few production organizations. A considerable size is often essential for efficient operation in research, manufacture and distribution.
21
Judicial construction of anti-trust legislation has generally been left unchanged by Congress. This is true of the Rule of Reason.7 While it is fair to say that the Rule is imprecise, its application in Sherman Act litigation, as directed against enhancement of price or throttling of competition, has given a workable content to antitrust legislation. See note 18, infra. It was judicially declared a proper interpretation of the Sherman Act in 1911, with a strong, clear-cut dissent challenging its soundness on the ground that the specific words of the Act covered every contract that tended to restrain or monopolize.8 This Court has not receded from its position on the Rule.9 There is not, we think, any inconsistency between it and the development of the judicial theory that agreements as to maintenance of prices or division of territory are in themselves a violation of the Sherman Act.10 It is logical that some agreements and practices are invalid per se, while others are illegal only as applied to particular situations.11
22
Difficulties of interpretation have arisen in the application of the Sherman Act in view of the technical changes in production of commodities and the new distribution practices.12 They have called forth reappraisal of the effect of the Act by business and government.13 That reappraisal has so far left the problems with which we are here concerned to the courts rather than to administrative agencies. Cf. Federal Trade Commission Act, 38 Stat. 721, 15 U.S.C.A. § 46. It is true that Congress has made exceptions to the generality of monopoly prohibitions, exceptions that spring from the necessities or conveniences of certain industries or business organizations, or from the characteristics of the members of certain groups of citizens.14 But those exceptions express legislative determination of the national economy's need of reasonable limitations on cutthroat competition or prohibition of monopoly. '(W)here exceptions are made, Congress should make them.' United States v. Line Material Co., 333 U.S. 287, 310, 68 S.Ct. 550, 562, 92 L.Ed. 701. They modify the reach of the Sherman Act but do not change its prohibition of other monopolies. We therefore turn to § 2 (note 2, supra) to determine whether du Pont has violated that section by its dominance in the manufacture of cellophane in the before-stated circumstances.
23
III. The Sherman Act, § 2—Monopolization.—The only statutory language of § 2 pertinent on this review is: 'Every person who shall monopolize * * * shall be deemed guilty * * *.' This Court has pointed out that monopoly at common law was a grant by the sovereign to any person for the sole making or handling of anything so that others were restrained or hindered in their lawful trade. Standard Oil Co. of New Jersey v. United States, 221 U.S. 1, 51, 31 S.Ct. 502, 512, 55 L.Ed. 619. However, as in England, it came to be recognized here that acts bringing the evils of authorized monopoly—unduly diminishing competition and enhancing prices—were undesirable, id., 221 U.S. at pages 56, 57, 58, 31 S.Ct. at pages 514, 515, and were declared illegal by § 2. Id., 221 U.S. at pages 60—62, 31 S.Ct. at pages 515—516. Our cases determine that a party has monopoly power if it has, over 'any part of the trade or commerce among the several states', a power of controlling prices or unreasonably restricting competition. Id., 221 U.S. at page 85, 31 S.Ct. at page 525.
24
Senator Hoar, in discussing § 2, pointed out that monopoly involved something more than extraordinary commercial success, 'that it involved something like the use of means which made it impossible for other persons to engage in fair competition.'15 This exception to the Sherman Act prohibitions of monopoly power is perhaps the monopoly 'thrust upon' one of United States v. Aluminum Co. of America, 2 Cir., 148 F.2d 416, 429, left as an undecided possibility by American Tobacco Co. v. United States, 328 U.S. 781, 66 S.Ct. 1125, 90 L.Ed. 1575. Compare United States v. United Shoe Machinery Corp., D.C., 110 F.Supp. 295, 342.16
25
If cellophane is the 'market' that du Pont is found to dominate, it may be assumed it does have monopoly power over that 'market.'17 Monopoly power is the power to control prices or exclude competition.18 It seems apparent that du Pont's power to set the price of cellophane has been limited only by the competition afforded by other flexible packaging materials. Moreover, it may be practically impossible for anyone to commence manufacturing cellophane without full access to du Pont's technique. However, du Pont has no power to prevent competition from other wrapping materials. The trial court consequently had to determine whether competition from the other wrappings prevented du Pont from possessing monopoly power in violation of § 2. Price and competition are so intimately entwined that any discussion of theory must treat them as one. It is inconceivable that price could be controlled without power over competition or vice versa. This approach to the determination of monopoly power is strengthened by this Court's conclusion in prior cases that, when an alleged monopolist has power over price and competition, an intention to monopolize in a proper case may be assumed.19
26
If a large number of buyers and sellers deal freely in a standardized product, such as salt or wheat, we have complete or pure competition. Patents, on the other hand, furnish the most familiar type of classic monopoly. As the producers of a standardized product bring about significant differentiations of quality, designed, or packaging in the product that permit differences of use, competition becomes to a greater or less degree incomplete and the producer's power over price and competition greater over his article and its use, according to the differentiation he is able to create and maintain. A retail seller may have in one sense a monopoly on certain trade because of location, as an isolated country store or filling station, or because no one else makes a product of just the quality or attractiveness of his product, as for example in cigarettes. Thus one can theorize that we have monopolistic competition in every nonstandardized commodity with each manufacturer having power over the price and production of his own product.20 However, this power that, let us say, automobile or soft-drink manufactures have over their trademarked products is not the power that makes an illegal monopoly. Illegal power must be appraised in terms of the competitive market for the product.21
27
Determination of the competitive market for commodities depends on how different from one another are the offered commodities in character or use, how far buyers will go to substitute one commodity for another. For example, one can think of building materials as in commodity competition but one could hardly say that brick competed with steel or wood or cement or stone in the meaning of Sherman Act litigation; the products are too different. This is the interindustry competition emphasized by some economists. See Lilienthal, Big Business, c. 5. On the other hand, there are certain differences in the formulae for soft drinks but one can hardly say that each one is an illegal monopoly. Whatever the market may be, we hold that control of price or competition establishes the existence of monopoly power under § 2. Section 2 requires the application of a reasonable approach in determining the existence of monopoly power just as surely as did § 1. This of course does not mean that there can be a reasonable monopoly. See notes 7 and 9, supra. Our next step is to determine whether du Pont has monopoly power over cellophane: that is, power over its price in relation to or competition with other commodities. The charge was monopolization of cellophane. The defense, that cellophane was merely a part of the relevant market for flexible packaging materials.
28
IV. The Relevant Market.—When a product is controlled by one interest, without substitutes available in the market, there is monopoly power. Because most products have possible substitutes, we cannot, as we said in Times-Picayune Pub. Co. v. United States, 345 U.S. 594, 612, 73 S.Ct. 872, 882, give 'that infinite range' to the definition of substitutes. Nor is it a proper interpretation of the Sherman Act to require that products be fungible to be considered in the relevant market.
The Government argues:
29
'we do not here urge that in no circumstances may competition of substitutes negative possession of monopolistic power over trade in a product. The decisions make it clear at the least that the courts will not consider substitutes other than those which are substantially fungible with the monopolized product and sell at substantially the same price.'
30
But where there are market alternatives that buyers may readily use for their purposes, illegal monopoly does not exist merely because the product said to be monopolized differs from others. If it were not so, only physically identical products would be a part of the market. To accept the Government's argument, we would have to conclude that the manufactures of plain as well as moistureproof cellophane were monopolists, and so with films such as Pliofilm, foil, glassine, polyethylene, and Saran, for each of these wrapping materials is distinguishable. These were all exhibits in the case. New wrappings appear, generally similar to cellophane, is each a monopoly? What is called for is an appraisal of the 'cross-elasticity' of demand in the trade. See Note, 54 Col.L.Rev. 580. The varying circumstances of each case determine the result.22 In considering what is the relevant market for determining the control of price and competition, no more definite rule can be declared than that commodities reasonably interchangeable by consumers for the same purposes make up that 'part of the trade or commerce', monopolization of which may be illegal. As respects flexible packaging materials, the market geographically is nationwide.
31
Industrial activities cannot be confined to trim categories. Illegal monopolies under § 2 may well exist over limited products in narrow fields where competition is eliminated.23 That does not settle the issue here. In determining the market under the Sherman Act, it is the use or uses to which the commodity is put that control. The selling price between commodities with similar uses and different characteristics may vary, so that the cheaper product can drive out the more expensive. Or, the superior quality of higher priced articles may make dominant the more desirable. Cellophane costs more than many competing products and less than a few. But whatever the price, there are various flexible wrapping materials that are bought by manufacturers for packaging their goods in their own plants or are sold to converters who shape and print them for use in the packaging of the commodities to be wrapped.
32
Cellophane differs from other flexible packaging materials. From some it differs more than from others. The basic materials from which the wrappings are made and the advantages and disadvantages of the products to the packaging industry are summarized in Findings 62 and 63. They are aluminum, cellulose acetate, chlorides, wood pulp, rubber hydrochloride, and ethylene gas. It will adequately illustrate the similarity in characteristics of the various products by nothing here Finding 62 as to glassine.24 Its use is almost as extensive as cellophane, Appendix C, 76 S.Ct. 1016, and many of its characteristics equally or more satisfactory to users.25
33
It may be admitted that cellophane combines the desirable elements of transparency, strength and cheapness more definitely than any of the others. Comparative characteristics have been noted thus:
34
'Moistureproof cellophane is highly transparent, tears readily but has high bursting strength, is highly impervious to moisture and gases, and is resistant to grease and oils. Heat sealable, printable, and adapted to use on wrapping machines, it makes an excellent packaging material for both display and protection of commodities.
35
'Other flexible wrapping materials fall into four major categories: (1) opaque nonmoistureproof wrapping paper designed primarily for convenience and protection in handling packages; (2) moistureproof films of varying degrees of transparency designed primarily either to protect, or to display and protect, the products they encompass; (3) nonmoistureproof transparent films designed primarily to display and to some extent protect, but which obviously do a poor protecting job where exclusion or retention of moisture is important; and (4) moistureproof materials other than films of varying degrees of transparency (foils and paper products) designed to protect and display.'26
36
An examination of Finding 59, Appendix, B, 76 S.Ct. 1015, will make this clear.
37
But, despite cellophane's advantages it has to meet competition from other materials in every one of its uses. Cellophane's principal uses are analyzed in Appendix A, Findings 281 and 282. Food products are the chief outlet, with cigarettes next. The Government makes no challenge to Finding 283 that cellophane furnishes less than 7% of wrappings for bakery products, 25% for candy, 32% for snacks, 35% for meats and poultry, 27% for crackers and biscuits, 47% for fresh produce, and 34% for frozen foods. Seventy-five to eighty percent of cigarettes are wrapped in cellophane. Finding 292. Thus, cellophane shares the packaging market with others. The over-all result is that cellophane accounts for 17.9% of flexible wrapping materials, measured by the wrapping surface. Finding 280, Appendix A., 76 S.Ct. 1012.
38
Moreover a very considerable degree of functional interchangeability exists between these products, as is shown by the tables of Appendix A and Findings 150—278.27 It will be noted, Appendix B, that except as to permeability to gases, cellophane has no qualities that are not possessed by a number of other materials. Meat will do as an example of interchangeability. Findings 205—220. Although du Pont's sales to the meat industry have reached 19,000,000 pounds annually, nearly 35%, this volume is attributed 'to the rise of self-service retailing of fresh meat.' Findings 212 and 283. In fact, since the popularity of self-service meats, du Pont has lost 'a considerable proportion' of this packaging business to Pliofilm. Finding 215. Pliofilm is more expensive than cellophane, but its superior physical characteristics apparently offset cellophane's price advantage. While retailers shift continually between the two, the trial court found that Pliofilm is increasing its share of the business. Finding 216. One further example is worth noting. Before World War II, du Pont cellophane wrapped between 5 and 10% of baked and smoked meats. The peak year was 1933. Finding 209. Thereafter du Pont was unable to meet the competition of Sylvania and of greaseproof paper. Its sales declined and the 1933 volume was not reached again until 1947. Findings 209—210. It will be noted that greaseproof paper, glassine, waxed paper, foil and Pliofilm and used as well as cellophane, Finding 218. Findings 209—210 show the competition and 215—216 the advantages that have caused the more expensive Pliofilm to increase its proportion of the business.
39
An element for consideration as to cross-elasticity of demand between products is the responsiveness of the sales of one product to price changes of the other.28 If a slight decrease in the price of cellophane causes a considerable number of customers of other flexible wrappings to switch to cellophane, it would be an indication that a high cross-elasticity of demand exists between them; that the products compete in the same market. The court below held that the '(g)reat sensitivity of customers in the flexible packaging markets to price or quality changes' prevented du Pont from possessing monopoly control over price. 118 F.Supp. at page 207. The record sustains these findings. See references made by the trial court in Findings 123—149.
40
We conclude that cellophane's interchangeability with the other materials mentioned suffices to make it a part of this flexible packaging material market.
41
The Government stresses the fact that the variation in price between cellophane and other materials demonstrates they are noncompetitive. As these products are all flexible wrapping materials, it seems reasonable to consider, as was done at the trial, their comparative cost to the consumer in terms of square area. This can be seen in Finding 130, Appendix C. Findings as to price competition are set out in the margin.29 Cellophane costs two or three times as much, surface measure, as its chief competitors for the flexible wrapping market, glassine and greaseproof papers. Other forms of cellulose wrappings and those from other chemical or mineral substances, with the exception of aluminum foil, are more expensive. The uses of these materials, as can be observed by Finding 283 in Appendix A, are largely to wrap small packages for retail distribution. The wrapping is a relatively small proportion of the entire cost of the article.30 Different producers need different qualities in wrappings and their need may vary from time to time as their products undergo change. But the necessity for flexible wrappings is the central and unchanging demand. We cannot say that these differences in cost gave du Pont monopoly power over prices in view of the findings of fact on that subject.31
42
It is the variable characteristics of the different flexible wrappings and the energy and ability with which the manufacturers push their wares that determine choice. A glance at 'Modern Packaging,' a trade journal, will give, by its various advertisements, examples of the competition among manufacturers for the flexible packaging market. The trial judge visited the 1952 Annual Packaging Show at Atlantic City, with the consent of counsel. He observed exhibits offered by 'machinery manufacturers, converters and manufacturers of flexible packaging materials.' He stated that these personal observations confirmed his estimate of the competition between cellophane and other packaging materials. Finding 820. From this wide variety of evidence, the Court reached the conclusion expressed in Finding 838:
43
'The record establishes plain cellophane and moistureproof cellophane are each flexible packaging materials which are functionally interchangeable with other flexible packaging materials and sold at same time to same customers for same purpose at competitive prices; there is no cellophane market distinct and separate from the market for flexible packaging materials; the market for flexible packaging materials is the relevant market for determining nature and extent of duPont's market control; and duPont has at all times competed with other cellophane producers and manufacturers of other flexible packaging materials in all aspects of its cellophane business.'
44
The facts above considered dispose also of any contention that competitors have been excluded by du Pont from the packaging material market. That market has many producers and there is no proof du Pont ever has possessed power to exclude any of them from the rapidly expanding flexible packaging market. The Government apparently concedes as much, for it states that 'lack of power to inhibit entry into this so-called market (i.e., flexible packaging materials), comprising widely disparate products, is no indicium of absence of power to exclude competition in the manufacture and sale of cellophane.' The record shows the multiplicity of competitors and the financial strength of some with individual assets running to the hundreds of millions. Findings 66—72. Indeed, the trial court found that du Pont could not exclude competitors even from the manufacture of cellophane, Finding 727, an immaterial matter if the market is flexible packaging material. Nor can we say that du Pont's profits, while liberal (according to the Government 15.9% net after taxes on the 1937—1947 average), demonstrate the existence of a monopoly without proof of lack of comparable profits during those years in other prosperous industries. Cellophane was a leader over 17%, in the flexible packaging materials market. There is no showing that du Pont's rate of return was greater or less than that of other producers of flexible packaging materials. Finding 719.
45
The 'market' which one must study to determine when a producer has monopoly power will vary with the part of commerce under consideration. The tests are constant. That market is composed of products that have reasonable interchangeability for the purposes for which they are produced—price, use and qualities considered. While the application of the tests remains uncertain, it seems to us that du Pont should not be found to monopolize cellophane when that product has the competition and interchangeability with other wrappings that this record shows.
46
On the findings of the District Court, its judgment is affirmed.
47
Affirmed.
48
Mr. Justice CLARK and Mr. Justice HARLAN took no part in the consideration or decision of this case.
Appendix A.
49
VIII. Results of du Pont's Competition With Other Materials.
50
(Findings 279—292.)
51
279. During the period du Pont entered the flexible packaging business, and since its introduction of moistureproof cellophane, sales of cellophane have increased. Total volume of flexible packaging materials used in the United States has also increased. Du Pont's relative percentage of the packaging business has grown as a result of its research, price, sales and capacity policies, but du Pont cellophane even in uses where it has competed has not attained the bulk of the business, due to competition of other flexible packaging materials.
52
280. Of the production and imports of flexible packaging materials in 1949 measured in wrapping surface, du Pont cellophane accounted for less than 20% of flexible packaging materials consumed in the United States in that year. The figures on this are:
Thousands of
Square Yards
Glassine, Greaseproof and
Vegetable Parchment Papers..... 3,125,826
53
Waxing Papers (18 Pounds and over). 4,614,685
54
Sulphite Bag and Wrapping Papers. 1,788,615
Aluminum Foil................... 1,317,807
Cellophane...................... 3,366,068
Cellulose Acetate................. 133,982
55
Pliofilm, Polyethylene, Saran and Cry-O-Rap. 373,871
Total....................... 14,720,854
56
Total du Pont Cellophane Production. 2,629,747
57
Du Pont Cellophane Per Cent of Total United
States Production and Imports of These
58
Flexible Packaging Materials...... 17.9% 281. Eighty percent of cellophane made by du Pont is sold for packaging in the food industry. Of this quantity, 80% is sold for packaging baked goods, meat, candy, crackers and biscuits, frozen foods, fresh vegetables and produce, potato chips, and 'snacks,' such as peanut butter sandwiches, popcorn, etc. A small amount is sold for wrapping of textiles and paper products, etc. Largest nonfood use of cellophane is the overwrapping of cigarette packages.
59
The breakdown of du Pont cellophane sales for the year 1949 was:
Use Sales Percent of
(M pounds) Total Sales
TOBACCO
Cigarettes............ 20,584. 11.6
Cigars................. 3,195. 1.8
Other Tobacco..........__1,657._0.9
Total................. 25,436. 14.3
FOOD PRODUCTS
Candy & Gum........... 17,054. 9.6
Bread & Cake.......... 40,081. 22.5
Crackers & Biscuits... 12,614. 7.1
Meat.................. 11,596. 6.5
Noodles & Macaroni..... 2,602. 1.5
Tea & Coffee........... 1,380. 0.8
Cereals................ 2,487. 1.4
Frozen Foods........... 5,234. 2.9
Dried Fruit............. 333. 0.2
Nuts....................... 2,946. 1.7
Popcorn & Potato Chips. 6,929. 3.9
Dairy Products......... 3,808. 2.1
Fresh Produce.......... 4,564. 2.6
Unclassified Foods......8,750._4.9
60
Total................. 120,478. 67.7 Use Sales Percent of
61
MISCELLANEOUS (M pounds) Total Sales
Hosiery................ 1,370. 0.7
Textiles............... 3,141. 1.8
Drugs.................. 1,031. 0.6
Rubber.................. 317. 0.2
Paper.................. 2,736. 1.5
Unclassified..........__18,602._10.5
Total................. 27,197. 15.3
Domestic Total......... 173,011. 97.3
Export.................. 4,820. 2.7
Grand Total............ 177,831. 100.0
62
282. Sales of cellophane by du Pont in 1951, by principal uses, were approximately as follows:
Pounds
White bread........between 8 and 9,000,000
Specialty breads............... 15,700,000
63
Cake and other baked sweet goods. 22,000,000
Meat........................... 19,000,000
Candy (including chewing gum).. 20,000,000
Crackers and biscuits.......... 17,000,000
Frozen foods.................... 5,800,000
Cigarettes..................... 23,000,000
64
283. 1949 sales of 19 major representative converters whose business covered a substantial segment of the total converting of flexible packaging materials for that year showed the following as to their sales of flexible packaging materials, classified by end use:
End Use Quantity Percent
(Millions of Total
BAKERY PRODUCTS sq. in.) End Use
Cellophane...... 109,670. 6.8
Foil.............. 2,652. .2
Glassine......... 72,216. 4.4
Papers............. 1,440,413. 88.6
Films..........______215.____.0
1,625,166 100.0
End Use Quantity Percent
(Millions of Total
CANDY sq. in.) End Use
Cellophane.......134,280.24.4
Foil............ 178,967.32.5
Glassine........ 117,634.21.4
Papers.......... 119,102.21.6
Films..........______484.____.1
550,467 100.0
SNACKS
Cellophane....... 61,250. 31.9
Foil...............1,571. .8
Glassine........ 120,556. 62.8
Papers............ 8,439. 4.4
Films............_____79.___.1
191,895 100.0
MEAT AND POULTRY
Cellophane....... 59,106.34.9
Foil..................88..1
Glassine.......... 4,524.2.7
Papers........... 97,255.57.5
Films........._____8,173.___4.8
169,056 100.0
CRACKERS AND BISCUITS
Cellophane....... 29,960. 26.6
Foil................ 192..2
Glassine......... 11,253. 10.0
Papers........... 71,147. 63.2
Films............._____8.___.0
112,560 100.0
FRESH PRODUCE
Cellophane....... 52,828. 47.2
Foil................. 43..1
Glassine............. 96. .1
Papers........... 51,035. 45.6
Films........._____7,867.___7.0
111,869 100.0
End Use
Quantity
Percent
FROZEN FOOD EXCLUDING DAIRY Millions of Total
PRODUCTS sq. in.) End Use
Cellophane....... 31,684. 33.6
Foil.................629. .7
Glassine.......... 1,943. 2.1
Papers........... 56,925. 60.3
Films............._3,154._3.3
94,335 100.0
65
284. About 96% of packaged white bread produced in the United States is wrapped in waxed paper or glassine, and about 6% in cellophane. The cellophane figure includes sales by all U.S. producers.
66
285. Forty-eight percent of specialty breads are wrapped in du Pont cellophane, the remainder in other cellophane or other materials. Most of this balance is wrapped in waxed paper and glassine.
67
286. Approximately 45% of cake and baked sweet goods packaged by wholesale bakers is wrapped in du Pont cellophane. The balance is wrapped in other cellophane or in waxed paper or glassine.
68
287. Between 25% and 35% of packaged candy units sold in the United States are wrapped in du Pont cellophane.
69
288. Of sponge and sweet crackers and biscuits combined approximately 25 to 30% of the packaged units produced in 1951 were wrapped in du Pont cellophane.
70
289. Du Pont cellophane at the present time is used on approximately 20 to 30% of packaged retail units of frozen foods. The remainder use waxed paper, waxed glassine, polyethylene, Pliofilm, Cry-O-Vac, or vegetable parchment.
71
290. Approximately 20 to 30% of packages of potato chips and other snacks are wrapped in du Pont cellophane. Most of the remainder are packaged in glassine and other flexible wraps.
72
291. Approximately 4 to 6% of the packaged units of cereal are wrapped in du Pont cellophane. The principal flexible packaging materials used are waxed paper and glassine.
73
292. Du Pont cellophane is used as an outer wrap on the paper-foil packages for approximately 75 to 80% of cigarettes sold in the United States. Sales for this use represent about 11.6% of du Pont's total sales of cellophane.
Appendix B.
74
59. The accompanying Table compares, descriptively, physical of cellophane and other flexible packaging materials:
PHYSICAL PROPERTIES
Tear
Packaging Heat Print- Strength
75
Materials Sealability ability Clarity (Elmendorf)
76
Cellophane (plain) Yes (if Yes Highly Transparent Low
77
coated)
78
Cellophane Yes (if Yes Highly Transparent Low
79
(Moisture-proof) coated)
Plain grease-proof No Yes Opaque Good
80
paper
Plain Glassine No Yes Commercially Good
Transparent to
Opaque
81
Lacquered Glassine Yes Yes Commercially Good
Transparent to
Translucent
82
Waxed Glassine Yes (1) Commercially Good
Transparent to
Translucent
83
Vegetable Parch- No Yes Tends to be Opaque Good
84
ment
Waxed Paper Yes (1) Commercially High
85
(18 lbs. or over) Transparent
Aluminum Foil No Yes Opaque Low
Aluminum Foil Yes Yes Opaque Low
86
(Heat Sealing)
87
Cellulose Acetate Yes Yes Highly Transparent Low
88
Pliofilm (rubber Yes (3) Yes (3) Highly Transparent Medium
89
hydrochloride) with Slight Haze
90
Saran (Vinylidene Yes (3) Yes (3) Highly Transparent High
Chloride)
91
Polyethylene Yes (3) Yes (3) Transparent with High
Slight Haze
92
Cry-O-Rap Yes (3) Yes (3) Transparent with High
Slight Haze
Sulphite (high fin- No Yes Opaque High
93
ish wrapper and
94
label paper)
TABLE CONTINUED
Water Wrapping
95
Absorption Dimens. Resistance Machine
96
Bursting in 24 hrs. Moisture Permeability Change With to Grease Running
97
Strength Immersion Permeability to Gases (2) Humid Diff. & Oils Qualities
98
High High High Very Low Large Excellent O.K.
99
High High Low-Medium Very Low Large Excellent O.K.
100
Low High High Medium Moderate Good O.K.
101
Low High High Low Moderate Good O.K.
102
Low Low Low-Medium Low Moderate Good O.K.
103
Low Low Low Low Moderate Good O.K.
104
Good High High Low Moderate Good O.K.
105
Good Low Low-Medium High Moderate None O.K.
106
Low Nil Very Low Very Low None Excellent O.K.
107
Low Nil Nearly Nil Very Low None Excellent O.K.
108
High Low High Variable Very Small Excellent O.K.
109
High Low Medium Low Very Small Excellent Good (3)
110
High Low Very Low Very Low None Excellent Poor (3)
111
High Low Medium High None (4) Poor (3)
112
High Low Medium Low None Excellent Poor (3)
113
Medium High Very High High Moderate None O.K.
Appendix C.
114
(Finding of Fact 130.)
115
1949 average wholesale prices of flexible packaging materials in the United States were:
Price per Price Yield
116
Packaging Material 1,000 sq. in. per lb. per lb.
117
Saran (cents) (cents) (sq. in.)
100 Gauge #517.... 6.1. 99.0 16,300
Cellulose Acetate
118
.00088"........... 3.3. 82.0 25,000
Polyethylene
119
.002"—18" Flat Width. 5.4. 81.0 15,000
Pliofilm
120 Gauge N 2..... 3.8. 80.8 21,000
Aluminum Foil
120
.00035"........... 1.8. 52.2 29,200
Moistureproof Cellophane
300 MST—51........ 2.3. 47.8 21,000
Plain Cellophane
300 PT............ 2.1. 44.8 21,500
Vegetable Parchment
27#............... 1.4. 22.3 16,000
Bleached Glassine
25#............... 1.0. 17.8 17,280
Bleached Greaseproof
25#............... .9. 15.8 17,280
Plain Waxed Sulphite
25# Self-Sealing.. 1.1. 15.2 14,400
Plain Waxed Sulphite
25# Coated Opaque. .7. 11.9 17,280
121
Cry-O-Rap. Sold only in converted form.
No unconverted quotations.
122
Mr. Justice FRANKFURTER, concurring.
123
I concur in the judgment of the Court and in so much of Mr. Justice REED'S opinion as supports the conclusion that cellophane did not by itself constitute a closed market but was a part of the relevant market for flexible packaging materials.
124
Mr. Justice REED has pithily defined the conflicting claims in this case. 'The charge was monopolization of cellophane. The defense, that cellophane was merely a part of the relevant market for flexible packaging materials.' Since this defense is sustained, the judgment below must be affirmed and it becomes unnecessary to consider whether du Pont's power over trade in cellophane would, had the defense failed, come within the prohibition of 'monopolizing' under § 2 of the Sherman Act. Needless disquisition on the difficult subject of singlefirm monopoly should be avoided since the case may be disposed of without consideration of this problem.
125
The boundary between the course of events by which a business may reach a powerful position in an industry without offending the outlawry of 'monopolizing' under § 2 of the Sherman Act and the course of events which brings the attainment of that result within the condemnation of that section, cannot be established by general phrases. It must be determined with reference to specific facts upon considerations analogous to those by which § 1 of the Sherman Act is applied. These were illuminatingly stated by Mr. Justice Brandeis for the Court:
126
'The true test of legality is whether the restraint imposed is such as merely regulates and perhaps thereby promotes competition or whether it is such as may suppress or even destroy competition. To determine that question the court must ordinarily consider the facts peculiar to the business to which the restraint is applied; its condition before and after the restraint was imposed; the nature of the restraint and its effect, actual or probable. The history of the restraint, the evil believed to exist, the reason for adopting the particular remedy, the the purpose or end sought to be attained, are all relevant facts. * * *' Board of Trade of City of Chicago v. United States, 246 U.S. 231, 238, 38 S.Ct. 242, 244, 62 L.Ed. 683.
127
Sections 1 and 2 of course implicate different considerations. But the so-called issued of fact and law that call for adjudication in this legal territory are united, and intrinsically so, with factors that entail social and economic judgment. Any consideration of 'monopoly' under the Sherman law can hardly escape judgment, even if only implied, on social and economic issues. It had best be withheld until a case inescapably calls for it.
128
Mr. Chief Justice WARREN, with whom Mr. Justice BLACK and Mr. Justice DOUGLAS join, dissenting.
129
This case, like many under the Sherman Act, turns upon the proper definition of the market. In defining the market in which du Pont's economic power is to be measured, the majority virtually emasculate § 2 of the Sherman Act. They admit that 'cellophane combines the desirable elements of transparency, strength and cheapness more definitely than any of' a host of other packaging materials. Yet they hold that all of those materials are so indistinguishable from cellophane as to warrant their inclusion in the market. We cannot agree that cellophane, in the language of Times-Picayune Publishing Co. v. United States, 345 U.S. 594, 613, 73 S.Ct. 872, 883, 97 L.Ed. 1277, is "the selfsame product" as glassine, greaseproof and vegetable parchment papers, waxed papers, sulphite papers, aluminum foil, cellulose acetate, and Pliofilm and other films.1
130
The majority opinion states that 'It will adequately illustrate the similarity in characteristics of the various products by noting here Finding 62 as to glassine.' But Finding 62 merely states the respects in which the selected flexible packaging materials are as satisfactory as cellophane; it does not compare all the physical properties of cellophane and other materials. The Table incorporated in Finding 59 does make such a comparison, and enables us to note cellophane's unique combination of qualities lacking among less expensive materials in varying degrees.2 A glance at this Table reveals that cellophane has a high bursting strength while glassine's is low; that cellophane's permeability to gases is lower than that of glassine; and that both its transparency and its resistance to grease and oils are greater than glassine's. Similarly, we see that waxed paper's bursting strength is less than cellophane's and that it is highly permeable to gases and offers no resistance whatsoever to grease and oils. With respect to the two other major products held to be close substitutes for cellophane, Finding 59 makes the majority's market definition more dubious. In contrast to cellophane, aluminum foil is actually opaque and has a low bursting strength. And sulphite papers, in addition to being opaque, are highly permeable to both moisture and gases, have no resistance to grease and oils, have a lower bursting strength than cellophane, and are not even heat sealable. Indeed, the majority go further than placing cellophane in the same market with such products. They also include the transparent films, which are more expensive than cellophane. These bear even less resemblance to the lower priced packaging materials than does cellophane. The juxtaposition of one of these films, Cry-O-Rap, with sulphite in the Table facilitates a comparison which shows that Cry-O-Rap is markedly different and far superior.
131
If the conduct of buyers indicated that glassine, waxed and sulphite papers and aluminum foil were actually 'the selfsame products' as cellophane, the qualitative differences demonstrated by the comparison of physical properties in Finding 59 would not be conclusive. But the record provides convincing proof that businessmen did not so regard these products. During the period covered by the complaint (1923—1947) cellophane enjoyed phenomenal growth. Du Pont's 1924 production was 361,249 pounds, which sold for.$1,306,662. Its 1947 production was 133,502,858 pounds, which sold for $55,339,626. Findings 297 and 337. Yet throughout this period the price of cellophane was far greater than that of glassine, waxed paper or sulphite paper. Finding 136 states that in 1929 cellophane's price was seven times that of glassine, in 1934, four times, and in 1949 still more than twice glassine's price. Reference to DX—994, the graph upon which Finding 136 is based, shows that cellophane had a similar price relation to waxed paper and that sulphite paper sold at even less than glassine and waxed paper. We cannot believe that buyers, practical businessmen, would have bought cellophane in increasing amounts over a quarter of a century if close substitutes were available at from one-seventh to one-half cellophane's price. That they did so is testimony to cellophane's distinctiveness.
132
The inference yielded by the conduct of cellophane buyers is reinforced by the conduct of sellers other than du Pont. Finding 587 states that Sylvania, the only other cellophane producer, absolutely and immediately followed every du Pont price change, even dating back its price list to the effective date of du Pont's change. Producers of glassine and waxed paper, on the other hand, displayed apparent indifference to du Pont's repeated and substantial price cuts. DX—994 shows that from 1924 to 1932 du Pont dropped the price of plain cellophane 84%, while the price of glassine remained constant.3 And during the period 1933—1946 the prices for glassine and waxed paper actually increased in the face of a further 21% decline in the price of cellophane. If 'shifts of business' due to 'price sensitivity' had been substantial, glassine and waxed paper producers who wanted to stay in business would have been compelled by market forces to meet du Pont's price challenge just as Sylvania was. The majority correctly point out that:
133
'An element for consideration as to cross-elasticity of demand between products is the responsiveness of the sales of one product to price changes of the other. If a slight decrease in the price of cellophane causes a considerable number of customers of other flexible wrappings to switch to cellophane, it would be an indication that a high cross-elasticity of demand exists between them; that the products compete in the same market.'
134
Surely there was more than 'a slight decrease in the price of cellophane' during the period covered by the complaint. That producers of glassine and waxed paper remained dominant in the flexible packaging materials market without meeting cellophane's tremendous price cuts convinces us that cellophane was not in effective competition with their products.4
135
Certainly du Pont itself shared our view. From the first, du Pont recognized that it need not concern itself with competition from other packaging materials. For example, when du Pont was contemplating entry into cellophane production, its Development Department reported that glassine 'is so inferior that it belongs in an entirely different class and has hardly to be considered as a competitor of cellophane.'5 This was still du Pont's view in 1950 when its survey of competitive prospects wholly omitted reference to glassine, waxed paper or sulphite paper and stated that 'Competition for du Pont cellophane will come from competitive cellophane and from non-cellophane films made by us or by others.'6
136
Du Pont's every action was directed toward maintaining dominance over cellophane. Its 1923 agreements with La Cellophane, the French concern which first produced commercial cellophane, gave du Pont exclusive North and Central American rights to cellophane's technology, manufacture and sale, and provided, without any limitation in time that all existing and future information pertaining to the cellophane process be considered 'secret and confidential,' and be held in an exclusive common pool.7 In its subsequent agreements with foreign licensees, du Pont was careful to preserve its continental market inviolate.8 In 1929, while it was still the sole domestic producer of cellophane, du Pont won its long struggle to raise the tariff from 25% to 60%, ad valorem, on cellophane imports,9 substantially foreclosing foreign competition. When Sylvania became the second American cellophane producer the following year and du Pont filed suit claiming infringement of its moistureproof patents, they settled the suit by entering into a cross-licensing agreement. Under this agreement du Pont obtained the right to exclude third persons from use of any patentable moistureproof invention made during the next 15 years by the sole other domestic cellophane producer, and, by a prohibitive royalty provision, it limited Sylvania's moistureproof production to approximately 20% of the industry's moistureproof sales.10 The record shows that du Pont and Sylvania were aware that, by settling the infringement suit, they avoided the possibility that the courts might hold the patent claims invalid and thereby open cellophane manufacture to additional competition.11 If close substitutes for cellophane had been commercially available, du Pont, an enlightened enterprise, would not have gone to such lengths to control cellophane.
137
As predicted by its 1923 market analysis,12 du Pont's dominance in cellophane proved enormously profitable from the outset. After only five years of production, when du Pont bought out the minority stock interests in its cellophane subsidiary, it had to pay more than fifteen times the original price of the stock.13 But such success was not limited to the period of innovation, limited sales and complete domestic monopoly. A confidential du Pont report shows that during the period 1937 1947, despite great expansion of sales, du Pont's 'operative return' (before taxes) averaged 31%, while its average 'net return' (after deduction of taxes, bonuses, and fundamental research expenditures) was 15.9%.14 Such profits provide a powerful incentive for the entry of competitors.15 Yet from 1924 to 1951 only one new firm, Sylvania, was able to begin cellophane production. And Sylvania could not have entered if La Cellophane's secret process had not been stolen.16 It is significant that for 15 years Olin Industries, a substantial firm, was unsuccessful in its attempt to produce cellophane, finally abandoning the project in 1944 after having spent about $1,000,000.17 When the Government brought this suit, du Pont, 'to reduce the hazard of being judged to have a monopoly of the U.S. cellophane business,'18 decided to let Olin enter the industry. Despite this demonstration of the control achieved by du Pont through its exclusive dominion over the cellophane process, the District Court found that du Pont could not exclude competitors from the manufacture of cellophane. Finding 727. This finding is 'clearly erroneous.'19 The majority avoid passing upon Finding 727 by stating that it is 'immaterial * * * if the market is flexible packaging material.' They do not appear to disagree with our conclusion, however, since they concede that '* * * it may be practically impossible for anyone to commence manufacturing cellophane without full access to du Pont's technique.'
The trial court found that
138
'Du Pont has no power to set cellophane prices arbitrarily. If prices for cellophane increase in relation to prices of other flexible packaging materials it will lose business to manufacturers of such materials in varying amounts for each of du Pont cellophane's major end uses.' Finding 712.
139
This further reveals its misconception of the antitrust laws. A monopolist seeking to maximize profits cannot raise prices 'arbitrarily.' Higher prices of course mean smaller sales, but they also mean higher per-unit profit. Lower prices will increase sales but reduce per-unit profit. Within these limits a monopolist has a considerable degree of latitude in determining which course to pursue in attempting to maximize profits. The trial judge thought that, if du Pont raised its price, the market would 'penalize' it with smaller profits as well as lower sales.20 Du Pont proved him wrong. When 1947 operating earnings dropped below 26% for the first time in 10 years, it increased cellophane's price 7% and boosted its earnings in 1948. Du Pont's division manager then reported that 'If an operative return of 31% is considered inadequate then an upward revision in prices will be necessary to improve the return.'21 It is this latitude with respect to price, this broad power of choice, that the antitrust laws forbid.22 Du Pont's independent pricing policy and the great profits consistently yielded by that policy leave no room for doubt that it had power to control the price of cellophane. The findings of fact cited by the majority cannot affect this conclusion.23 For they merely demonstrate, that during the period covered by the complaint, du Pont was a 'good monopolist,' i.e., that it did not engage in predatory practices and that it chose to maximize profits by lowering price and expanding sales. Proof of enlightened exercise of monopoly power certainly does not refute the existence of that power.
140
The majority opinion purports to reject the theory of 'interindustry competition.' Brick, steel, wood, cement and stone, it says, are 'too different' to be placed in the same market. But cellophane, glassine, wax papers, sulphite papers, greaseproof and vegetable parchment papers, aluminum foil, cellulose acetate, Pliofilm and other films are not 'too different,' the opinion concludes. The majority approach would apparently enable a monopolist of motion picture exhibition to avoid Sherman Act consequences by showing that motion pictures compete in substantial measure with legitimate theater, television, radio, sporting events and other forms of entertainment. Here, too, 'shifts of business' undoubtedly accompany fluctuations in price and 'there are market alternatives that buyers may readily use for their purposes'. Yet, in United States v. Paramount Pictures, 334 U.S. 131, 68 S.Ct. 915, 92 L.Ed. 1260, where the District Court had confined the relevant market to that for nationwide movie exhibition, this Court remanded the case to the District Court with directions to determine whether there was a monopoly on the part of the five major distributors 'in the first-run field for the entire country, in the first-run field in the 92 largest cities of the country, or in the first-run field in separate localities.' 334 U.S. at page 172, 68 S.Ct. at page 936. Similarly, it is difficult to square the majority view with United States v. Aluminum Co. of America, 2 Cir., 148 F.2d 416, a landmark § 2 case. There Judge Learned Hand, reversing a district court, held that the close competition which 'secondary' (used) aluminum offered to 'virgin' aluminum did not justify including the former within the relevant market for measuring Alcoa's economic power. Against these and other precedents, which the Court's opinion approves but does not follow, the formula of 'reasonable interchangeability,' as applied by the majority, appears indistinguishable from the theory of 'interindustry competition.' The danger in it is that, as demonstrated in this case, it is 'perfectly compatible with a fully monopolized economy.'24
141
The majority hold in effect that, because cellophane meets competition for many end uses, those buyers for other uses who need or want only cellophane are not entitled to the benefits of competition within the cellophane industry. For example, Finding 282 shows that the largest single use of cellophane in 1951 was for wrapping cigarettes, and Finding 292 shows that 75 to 80% of all cigarettes are wrapped with cellophane. As the recent report of the Attorney General's National Committee to Study the Antitrust Laws states: 'In the interest of rivalry that extends to all buyers and all uses, competition among rivals within the industry is always important25 (Emphasis added.).' Furthermore, those buyers who have 'reasonable alternatives' between cellophane and other products are also entitled to competition within the cellophane industry, for such competition may lead to lower prices and improved quality.
142
The foregoing analysis of the record shows conclusively that cellophane is the relevant market. Since du Pont has the lion's share of that market, it must have monopoly power, as the majority concede.26 This being so, we think it clear that, in the circumstances of this case, du Pont is guilty of 'monopolization.' The briefest sketch of du Pont's business history precludes it from falling within the 'exception to the Sherman Act prohibitions of monopoly power' (majority opinion, 76 S.Ct. 1004) by successfully asserting that monopoly was 'thrust upon' it. Du Pont was not 'the passive beneficiary of a monopoly' within the meaning of United States v. Aluminum Co. of America, supra, 148 F.2d at pages 429—430. It sought and maintained dominance through illegal agreements dividing the world market, concealing and suppressing technological information, and restricting its licensee's production by prohibitive royalties,27 and through numerous maneuvers which might have been 'honestly industrial' but whose necessary effect was nevertheless exclusionary.28 Du Pont cannot bear 'the burden of proving that it owes its monopoly solely to superior skill * * *.' (Emphasis supplied.) United States v. United Shoe Machinery Corp., D.C., 110 F.Supp. 295, 342, affirmed per curiam 347 U.S. 521, 74 S.Ct. 699, 98 L.Ed. 910.
143
Nor can du Pont rely upon its moistureproof patents as a defense to the charge of monopolization. Once du Pont acquired the basic cellophane process as a result of its illegal 1923 agreements with La Cellophane, development of moistureproofing was relatively easy. Du Pont's moistureproof patents were fully subject to the exclusive pooling arrangements and territorial restrictions established by those agreements. And they were the subject of the illicit and exclusionary du Pont-Sylvania agreement. Hence, these patents became tainted as part and parcel of du Pont's illegal monopoly. Cf., Mercoid Corp. v. Mid-Continent Inv. Co., 320 U.S. 661, 670, 64 S.Ct. 268, 273, 88 L.Ed. 376. Any other result would permitone who monopolizes a market to escape the statutory liability by patenting a simple improvement on his product.
144
If competition is at the core of the Sherman Act, we cannot agree that it was consistent with that Act for the enormously lucrative cellophane industry to have no more than two sellers from 1924 to 1951. The conduct of du Pont and Sylvania illustrates that a few sellers tend to act like one and that an industry which does not have a competitive structure will not have competitive behavior. The public should not be left to rely upon the dispensations of management in order to obtain the benefits which normally accompany competition. Such beneficence is of uncertain tenure. Only actual competition can assure long-run enjoyment of the goals of a free economy.
145
We would reverse the decision below and remand the cause to the District Court with directions to determine the relief which should be granted against du Pont.
1
United States v. E. I. du Pont de Nemours & Co., D.C., 118 F.Supp. 41. The opinion occupies 192 pages of the volume. The Findings of Fact, 854 in number, cover 140 pages. The citations to findings in our opinion, where references are not made to our appendices, 76 S.Ct. 1012 to 1016, are to the Federal Supplement. We noted probable jurisdiction October 14, 1954, 348 U.S. 806, 75 S.Ct. 41, 99 L.Ed. 637.
2
'Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal * * *.' 15 U.S.C.1952 ed. Supp. III, § 1, 15 U.S.C.A. § 1.
'Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a misdemeanor, and, on conviction thereof, shall be punished by fine not exceeding fifty thousand dollars, or by imprisonment not exceeding one year, or by both said punishments, in the discretion of the court.' Id., § 2.
'The several district courts of the United States are invested with jurisdiction to prevent and restrain violations of sections 1—7 of this title * * *.' 15 U.S.C. § 4, 15 U.S.C.A. § 4.
3
See also United States v. Yellow Cab Co., 338 U.S. 338, 70 S.Ct. 177, 94 L.Ed. 150; United States v. Oregon State Medical Soc., 343 U.S. 326, 339, 72 S.Ct. 690, 698, 96 L.Ed. 978; United Shoe Machinery Corp. v. United States, 347 U.S. 521, 74 S.Ct. 699, 98 L.Ed. 910.
4
Initially, the proper cellulose content of the viscose must be determined. This viscous fluid is ripened according to a 'ripening index,' a test whereby viscose is put in a salt solution and shaken to bring out the coagulation point. The requisite strength of this solution varies according to the ripening time. Fourteen additional baths follow the first coagulating bath. The most advantageous ripening time, temperature, size, composition, and duration of each of the baths were all determined by the trials and errors of Brandenberger and La Cellophane, the corporation he directed. It was estimated that in 1923 it would have taken four or five years of experimentation by a new producer of cellophane to attain this production technique.
5
Substantially identical letters were sent in this form:
'Question has been raised within our organization as to the existence of territorial limitations under our agreements with your company relating to regenerated cellulose film. In order that our position may be clearly and frankly established, we desire to record with you our conclusions.
'Based upon the provisions of the contracts, and in the light of legal developments in this country, we construe these agreements as imposing no restrictions upon the sale of regenerated cellulose film in any country in which the public is free to sell. Thus we regard each party as free to export such film to any country in the world, subject only to such limitations as lawfully may be based upon the unauthorized use of patented inventions or trade-marks in the country of manufacture, or in the country of use or sale.
'This letter is not intended to modify any of the provisions of our agreements involving the exchange of technical information.' R. 3323.
6
Further information from the findings as to competition will be found in Findings 150—278.
7
This was set forth and defined in Standard Oil Co. of New Jersey v. United States, 221 U.S. 1, 58—62, 31 S.Ct. 502, 516, 55 L.Ed. 619. It was based on the generality of §§ 1 and 2 of the Sherman Act, which were said to be 'broad enough to embrace every conceivable contract or combination which could be made concerning trade or commerce' and therefore required a 'standard.' The standard of reason, drawn from the common law, was adopted. See Adams, The 'Rule of Reason,' 63 Yale L.J. 348; and Oppenheim, Federal Antitrust Legislation, 50 Mich.L.Rev., at 1156, notes 11 and 13.
8
Id., 221 U.S. at page 86 et seq., 31 S.Ct. at page 526.
9
United States v. Columbia Steel Co., 334 U.S. 495, 529, 68 S.Ct. 1107, 1125, 92 L.Ed. 1533; Times-Picayune Pub. Co. v. United States, 345 U.S. 594, 614—615, 73 S.Ct. 872, 883, 97 L.Ed. 1277.
10
See United States v. Trenton Potteries Co., 273 U.S. 392, 47 S.Ct. 377, 71 L.Ed. 700; American Tobacco Co. v. United States, 328 U.S. 781, 813, 66 S.Ct. 1125, 1140, 90 L.Ed. 1575; Timken Roller Bearing Co. v. United States, 341 U.S. 593, 71 S.Ct. 971, 95 L.Ed. 1199.
11
Cf. Oppenheim, Federal Antitrust Legislation, 50 Mich.L.Rev. 1139, 1151—1152; Adams, The 'Rule of Reason', 63 Yale L.J. 348; and The Schwartz Dissent, 1 Antitrust Bulletin 37, 47.
12
United States v. Columbia Steel Co., 334 U.S. 495, 526, 68 S.Ct. 1107, 1123, 92 L.Ed. 1533.
13
Final Report, Investigation of Concentration of Economic Power, S.Doc. No. 35, 77th Cong., 1st Sess.: Monograph No. 38 of that Investigation, Handler, A Study of the Construction and Enforcement of the Federal Antitrust Laws, 76th Cong., 3d Sess., Effective Competition, Report to the Secretary of Commerce, Charles Sawyer, by his Business Advisory Council, December 18, 1952; Report of the Attorney General's National Committee to Study the Antitrust Laws, March 31, 1955; Oppenheim, Federal Antitrust Legislation, 50 Mich.L.Rev. 1139; Kahn, A Legal and Economic Appraisal of the 'New' Sherman and Clayton Acts, 63 Yale L.J. 293; Adams, The 'Rule of Reason,' 63 Yale L.J. 348; Rostow, Monopoly Under the Sherman Act: Power or Purpose? 43 Ill.L.Rev. 745.
14
Numerous Acts contain specific exemptions from the operation of the antitrust laws: Clayton Act, 15 U.S.C. § 17 (1946), 15 U.S.C.A. § 17 (all labor organizations); McCarran-Ferguson Act, 15 U.S.C. § 1013 (1952), 15 U.S.C.A. § 1013 (insurance companies); Webb-Pomerene Act, 15 U.S.C. § 62 (1946), 15 U.S.C.A. § 62 (limited exemption for foreign trade associations); Capper-Volstead Act, 7 U.S.C. §§ 291, 292 (1927), 7 U.S.C.A. §§ 291, 292 (farm cooperatives); Interstate Commerce Act, 49 U.S.C. § 5(11) (1952), 49 U.S.C.A. § 5(11) (carriers participating in an approved transaction); Civil Aeronautics Act, 49 U.S.C. § 494 (1952), 49 U.S.C.A. § 494 (exemption for acts ordered by the CAB).
Market entry is carefully regulated in some of the country's largest businesses: Natural Gas Act, 15 U.S.C. § 717f, 15 U.S.C.A. § 717f (natural gas companies); Federal Communications Act, 47 U.S.C. § 307(a) (1952), 47 U.S.C.A. § 307(a) (limits new stations); Civil Aeronautics Act, 49 U.S.C. § 481(d) (1951), 49 U.S.C.A. § 481(d) (limits market entry); Motor Carrier Act, 49 U.S.C. § 307 (1952), 49 U.S.C.A. § 307 (motor vehicle common carriers). Price fixing in some areas is authorized by the legislature: Reed-Bulwinkle Act, 49 U.S.C. § 5b (1952), 49 U.S.C.A. § 5b (railroad rate agreements); Civil Aeronautics Act, 49 U.S.C. § 492 (1952), 49 U.S.C.A. § 492 (approval of transportation rate agreements); Miller-Tydings Act, 15 U.S.C. § 1 (1946), 15 U.S.C.A. § 1 (resale price maintenance); Shipping Act, 46 U.S.C. § 814 (1952), 46 U.S.C.A. § 814 (water carriers' rate agreements).
Combination of strong competitors in some major instances has been encouraged: Federal Communications Act, 47 U.S.C. §§ 221(a), 222(c)(1) (1952), 47 U.S.C.A. §§ 221(a) 222(c)(1); Federal Power Act, 16 U.S.C. § 824a(b), (1952), 16 U.S.C.A. § 824a(b); Interstate Commerce Act, 49 U.S.C. § 5b (1952), 49 U.S.C.A. § 5b (all common carriers).
That competition is not always to be encourage is made evident by noting that the farmers have been actually barred from production in most major crops and some groups of workers are told that they may not, in production of commodities for commerce, work for less than a minimum wage. Fair Labor Standards Act, 29 U.S.C. § 206 (1952), 29 U.S.C.A. § 206.
See Report of Attorney General's National Committee to Study the Antitrust Laws, pp. 261—313, for discussion of 'Exemptions From Antitrust Coverage.'
15
21 Cong.Rec. 3151:
'Mr. Kenna. Mr. President, I have no disposition to delay a vote on the bill, but I would like to ask, with his permission, the Senator from Vermont a question touching the second section:
"Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade, etc.'
'It is intended by the committee, as the section seems to indicate, that if an individual engaged in trade between States or between States and Territories, or between States or Territories and the District of Columbia, or between a State and a foreign country, by his own skill and energy, by the propriety of his conduct generally, shall pursue his calling in such a way as to monopolize a trade, his action shall be a crime under this proposed act? To make myself understood, if I am not clear—
'Mr. Edmunds. I think I understand the Senator.
'Mr. Kenna. Suppose a citizen of Kentucky is dealing in shorthorn cattle and by virtue of his superior skill in that particular product it turns out that he is the only one in the United States to whom an order comes from Mexico for cattle of that stock for a considerable period, so that he is conceded to have a monopoly of that trade with Mexico; is it intended by the committee that the bill shall make that man a culprit?
'Mr. Edmunds. It is not intended by it and the bill does not do it. Anybody who known the meaning of the word 'monopoly,' as the courts apply it, would not apply it to such a person at all; and I am sure my friend must understand that.'
Id., at 3152:
'Mr. Hoar. I put in the committee, if I may be permitted to say so (I suppose there is no impropriety in it), the precise question which has been put by the Senator from West Virginia, and I had that precise difficulty in the first place with this bill, but I was answered, and I think all the other members of the committee agreed in the answer, that 'monopoly' is a technical term known to the common law, and that it signifies—I do not mean to say that they stated what the signification was, but I became satisfied that they were right and that the word 'monopoly' is a merely technical term which has a clear and legal signification, and it is this: It is the sole engrossing to a man's self by means which prevent other men from engaging in fair competition with him.
'Of course a monopoly granted by the King was a direct inhibition of all other persons to engage in that business or calling or to acquire that particular article, except the man who had a monopoly granted him by the sovereign power. I suppose, therefore, that the courts of the United States would say in the case put by the Senator from West Virginia that a man who merely by superior skill and intelligence, a breeder of horses or raiser of cattle, or manufacturer or artisan of any kind, got the whole business because nobody could do it as well as he could was not a monopolist, but that it involved something like the use of means which made it impossible for other persons to engage in fair competition, like the engrossing, the buying up of all other persons engaged in the same business.'
16
See 76 S.Ct. 999.
17
Compare Standard Oil Co. of New Jersey v. United States, 221 U.S. 1, 74, 31 S.Ct. 502, 522, 55 L.Ed. 619, and American Tobacco Co. v. United States, 328 U.S. 781, 813—814, 66 S.Ct. 1125, 1140—1141; United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 226, 60 S.Ct. 811, 846, 84 L.Ed. 1129, last paragraph, note 59.
18
See American Tobacco Co. v. United States, 328 U.S. 781, 811, 66 S.Ct. 1125, 1139; Apex Hosiery Co. v. Leader, 310 U.S. 469, 501, 60 S.Ct. 982, 996, 84 L.Ed. 1311; Standard Oil Co. of New Jersey v. United States, 221 U.S. 1, 58, 31 S.Ct. 502, 515. See Stocking and Mueller, The Cellophane Case and the New Competition, XLV American Economic Rev. 29, 54; Cole, An Appraisal of Economic Change, XLIV American Economic Rev. 35, 61; Wilcox, TNEC Monograph No. 21, pp. 9, 11; The Schwartz Dissent, 1 Antitrust Bulletin at 39; Report of Attorney General's National Committee to Study the Antitrust Laws, p. 43; Neal, The Clayton Act and the Trans-America Case, 5 Stan.L.Rev. 179, 205, 213.
19
United States v. Columbia Steel Co., 334 U.S. 495, 525, 68 S.Ct. 1107, 1123, 92 L.Ed. 1533; United States v. Paramount Pictures, 334 U.S. 131, 173, 68 S.Ct. 915, 936, 92 L.Ed. 1260; Apex Hosiery Co. v. Leader, 310 U.S. 469, 501, 60 S.Ct. 982, 996, 84 L.Ed. 1311; cf. Rostow, 43 Ill.L.Rev. 745, 753—763; Oppenheim, Federal Antitrust Legislation, 50 Mich.L.Rev. 1139, 1193.
20
See Chamberlin, Theory of Monopolistic Competition, c. IV.
21
See United States v. Columbia Steel Co., 334 U.S. 495, 527, 68 S.Ct. 1107, 1124; Times-Picayune Pub. Co. v. United States, 345 U.S. 594, 610, 73 S.Ct. 872, 881, 97 L.Ed. 1277; Standard Oil Co. (Indiana) v. United States, 283 U.S. 163, 179, 51 S.Ct. 421, 427, 75 L.Ed. 926.
22
Maple Flooring Mfrs' Ass'n v. United States, 268 U.S. 563, 579, 45 S.Ct. 578, 583, 69 L.Ed. 1093:
'It should be said at the outset that in considering the application of the rule of decision in these cases to the situation presented by this record, it should be remembered that this court has often announced that each case arising under the Sherman Act must be determined upon the particular facts disclosed by the record, and that the opinions in those cases must be read in the light of their facts and of a clear recognition of the essential differences in the facts of those cases, and in the facts of any new case to which the rule of earlier decisions is to be applied.'
23
The Government notes that the prohibitions of § 2 of the Sherman Act have often been extended to producers of single products and to businesses of limited scope. But the cases to which the Government refers us were not concerned with the problem that is now before the Court. In Story Parchment Co. v. Paterson Parchment Paper Co., 282 U.S. 555, 51 S.Ct. 248, 75 L.Ed. 544, a conspiracy to monopolize trade in vegetable parchment was held to be a violation of § 2. Parchment paper is obviously no larger a part of commerce than cellophane. Recovery, however, was based on proven allegations of combination and conspiracy to monopolize, and the scope of the market was not in issue. 282 U.S. at page 560, 51 S.Ct. at page 249. Similarly, Indiana Farmer's Guide Pub. Co. v. Prairie Farmer Publishing Co., 293 U.S. 268, 55 S.Ct. 182, 79 L.Ed. 356, ruled that a combination or conspiracy for the purpose of monopolizing the farm-paper business in the north central part of the Nation would be illegal by reason of the second section of the Sherman Act. Lorain Journal Co. v. United States, 342 U.S. 143, 72 S.Ct. 181, 96 L.Ed. 162, a case not cited by the Government, was concerned with even a smaller
geographical area (dissemination of news in a community and surrounding territory). But the Court held only that defendant had attempted to monopolize not that he had in fact monopolized. Also, this Court found in United States v. Columbia Steel Co., 334 U.S. 495, 68 S.Ct. 1107, 1124, 92 L.Ed. 1533, that the 'relevant competitive market' for determining whether there had been an unreasonable restraint of trade (or an attempt to monopolize) was the market for 'rolled steel' products in an 11-state area. Women's dresses of 'original design,' Fashion Originators' Guild of America v. Federal Trade Comm., 312 U.S. 457, 61 S.Ct. 703, 85 L.Ed. 949; 'first run' motion pictures, United States v. Paramount Pictures, 334 U.S. 131, 68 S.Ct. 915, 92 L.Ed. 1260; the news services of one news agency, United States v. Associated Press, D.C.S.D.N.Y., 52 F.Supp. 362, affirmed 326 U.S. 1, 65 S.Ct. 1416, 89 L.Ed. 2013, and newspaper advertising as distinguished from other means of news dissemination, Times-Picayune Pub. Co. v. United States, 345 U.S. 594, 73 S.Ct. 872, have all been designated as parts of commerce. All four were concerned only with the question of whether there had been an attempt to monopolize. United States v. Aluminum Co. of America, 2 Cir., 148 F.2d 416, did involve the question of monopolization. Judge Hand found that the relevant market for measuring Alcoa's power was the market for 'virgin' aluminum; he refused to consider the close competition offered by 'secondary' (used) aluminum. The reason for the narrow definition was that Alcoa's control over virgin aluminum permitted it to regulate the supply of used aluminum even though the latter should be actually sold by a competitor. Consequently, the case is not particularly helpful in the problem of market definition now before the Court.
24
'62. * * * Greaseproof paper is made by beating wood pulp in a vat filled with water until the fibers become saturated and gelatinous in texture. Resulting product is translucent and resistant to oil and grease.
'Glassine is produced by finishing greaseproof paper between highly polished metal rollers under heat and at pressure. This process develops the transparency and surface gloss with are characteristic of glassine. It is greaseproof, and can be sealed by heat, if coated. It is made moistureproof by coating and with appropriate lacquers or waxes and may be printed.'
25
'63. There are respects in which other flexible packaging materials are as satisfactory as cellophane:
'Glassine.
'Glassine is, in some types, about 90% transparent, so printing is legible through it.
'Glassine affords low cost transparency.
'Moisture protection afforded by waxed or lacquered glassine is as good as that or moistureproof cellophane.
'Glassine has greater resistance to tearing and breakage than cellophane.
'Glassine runs on packaging machinery with ease equal to that of cellophane.
'Glassine can be printed faster than cellophane, and can be run faster than moistureproof cellophane on bag machines.
'Glassine has greater resistance than cellophane to rancidity-inducing ultraviolet rays.
'Glassine has dimensional stability superior to cellophane.
'Glassine is more durable in cold weather than cellophane.
'Printed glassine can be sold against cellophane on the basis of appearance.
'Glassine may be more easily laminated than cellophane.
'Glassine is cheaper than cellophane in some types, comparable in others.'
26
Stocking and Mueller, The Cellophane Case, XLV Amer. Economic Rev. 29, 48—49.
27
There are eighteen classifications: White Bread; Specialty Breads; Cake and Sweet Goods; Meat; Candy; Crackers and Biscuits; Frozen Foods; Potato Chips, Pop Corn and Snacks; Cereals; Fresh Produce; Paper Goods and Textiles; Cigarettes; Butter; Chewing Gum; Other Food Products; Other Tobacco Products; Cheese; Oleomargarine.
28
Scitovsky, Welfare and Competition (1951) 396; Bain, Pricing, Distribution, and Employment (1953 rev.ed.), 52.
29
'132. The price of cellophane is today an obstacle to its sales in competition with other flexible packaging materials.
'133. Cellophane has always been higher priced than the two largest selling flexible packaging materials, wax paper and glassine, and this has represented a disadvantage to sales of cellophane.
'134. DuPont considered as a factor in the determination of its prices, the prices of waxed paper, glassine, greaseproof, vegetable parchment, and other flexible packaging materials.
'135. DuPont, in reducing its prices, intended to narrow price differential between cellophane and packaging papers, particularly glassine and waxed paper. The objective of this effort has been to increase the use of cellophane. Each price reduction was intended to open up new uses for cellophane, and to attract new customers who had not used cellophane because of its price.'
30
See, e.g., R. 4846.
31
'140. Some users are sensitive to the cost of flexible packaging materials; others are not. Users to whom cost is important include
substantial business: for example, General Foods, Armour, Curtiss Candy Co., and smaller users in the bread industry, cracker industry, and frozen food industry. These customers are unwilling to use more cellophane because of its relatively high price, would use more if the price were reduced, and have increased their use as the price of cellophane has been reduced.
'141. The cost factor slips accounts away from cellophane. This hits at the precarious users, whose profit margins on their products are low, and has been put in motion by competitive developments in the user's trade. Examples include the losses of business to glassine in candy bar wraps in the 30's, frozen food business to waxed paper in the late 40's, and recent losses to glassine in cracker packaging.
'142. The price of cellophane was reduced to expand the market for cellophane. DuPont did not reduce prices for cellophane with intent of monopolizing manufacture or with intent of suppressing competitors.
'143. DuPont reduced cellophane prices to enable sales to be made for new uses from which higher prices had excluded cellophane, and to expand sales. Reductions were made as sales volume and market conditions warranted. In determining price reductions, DuPont considered relationship between its manufacturing costs and proposed prices, possible additional volume that might be gained by the price reduction, effect of price reduction upon the return duPont would obtain on its investment. It considered the effect its lowered price might have on the manufacture by others, but this possible result of a price reduction was never a motive for the reduction.
'144. DuPont never lowered cellophane prices below cost, and never dropped cellophane prices temporarily to gain a competitive advantage.
'145. As duPont's manufacturing costs declined, 1924 to 1935, duPont reduced prices for cellophane. When costs of raw materials increased subsequent to 1935, it postponed reductions until 1938 and 1939. Subsequent increases in cost of raw material and labor brought about price increases after 1947.'
References:
(1) Normally printed before waxing.
(2) The permeability to gases can vary greatly depending upon the gas and the humidity conditions. The levels indicated in this chart apply particularly to flavor type volatiles as found in many food products.
(3) Plastic films may require special heat sealing techniques, and printing processes or special machines.
(4) Not affected by greases but penetrated by some oils.
(5) The information on this chart is based upon the generally accepted properties of the materials listed; however, materials produced by different processes, formulations, coatings, raw materials, surface treatments, and thicknesses can show considerable variation from the properties indicated.
1
In Times—Picayune Publishing Co. v. United States, 345 U.S. 594, 612, note 31, 73 S.Ct. 872, 882, the Court said:
'For every product, substitutes exist. But a relevant market cannot meaningfully encompass that infinite range. The circle must be drawn narrowly to exclude any other product to which, within reasonable variations in price, only a limited number of buyers will turn; in technical terms, products whose 'cross-elasticities of demand' are small.'
2
See 118 F.Supp. at page 64. The majority opinion quotes at length from Stocking and Mueller, The Cellophane Case, XLV Amer.Economic Rev. 29, 48—49, in noting the comparative characteristics of cellophane and other products. Unfortunately, the opinion fails to quote the conclusion reached by these economists. They state: 'The (trial) court to the contrary notwithstanding, the market in which cellophane meets the 'competition' of other wrappers is narrower than the market for all flexible packaging materials.' Id., at 52. And they conclude that '* * * cellophane is so differentiated from other flexible wrapping materials that its cross elasticity of demand gives du Pont significant and continuing monopoly power.' Id., at 63.
3
The record provides no figures for waxed paper prior to 1933.
4
See Stocking and Mueller, The Cellophane Case, XLV Amer.Economic Rev. 29, 56.
5
R. 3549, GX—392. The record contains many reports prepared by du Pont from 1928 to 1947. They virtually ignore the possibility of competition from other packaging materials. E.g., R. 3651, 3678, 3724, 3739.
6
R. 4070. It is interesting to note that du Pont had almost 70% of the market which this report considered relevant.
7
See Finding 24; GX—1001, R. 3253; and GX—1002, R. 3257 3260. The agreement of June 9, 1923, in which the parties agreed to divide the world cellophane market, is illegal per se under Timken Roller Bearing Co. v. United States, 341 U.S. 593, 596—599, 71 S.Ct. 971, 973—975, 95 L.Ed. 1199. The supplementary agreement providing for the interchange of technological information tightened the cellophane monopoly and denied to others any access to what went into the common pool—all in violation of United States v. National Lead Co., 332 U.S. 319, 328, 67 S.Ct. 1634, 1638, 91 L.Ed. 2077. As was said in United States v. Griffith, 334 U.S. 100, 107, 68 S.Ct. 941, 945, 92 L.Ed. 1236: 'The anti-trust laws are as much violated by the prevention of competition as by its destruction.'
8
See Finding 602; GX—1087, R. 3288; and GX—1109, R. 3301.
9
Finding 633. On appeal from an adverse decision by the Commissioner of Customs, du Pont persuaded the United States Customs Court to order reclassification of cellophane.
10
The agreement is summarized in Finding 545 and appears in full in GX—2487, R. 3383—3408. We believe that under the principles set forth in Transparent-Wrap Machine Corp. v. Stokes & Smith Co., 329 U.S. 637, 646, 67 S.Ct. 610, 615, 91 L.Ed. 563, this agreement violated the Sherman Act.
11
GX—2811, R. 6073—6074.
12
R. 3563.
13
When du Pont Cellophane was organized in 1923, du Pont received 52,000 shares of its stock in return for $866,666.67 in cash, or.$16.67 per share. F. 22; DX—735, R. 5402. In 1929 du Pont had to surrender stock having a market value of $12,129,600 in order to obtain the 48,000 shares held by French interests, a sum equal to $252.70 per share. DX—735, R. 5403.
14
R. 4155.
15
See Stocking and Mueller, The Cellophane case, XLV Amer. Economic Rev. 29, 60—63, where the authors compare the domestic economic history of rayon with that of cellophane. The first American rayon producer earned 64.2% on its investment in 1920, thereby attracting du Pont. After a loss in 1921, du Pont's average return for the next four years was roughly 32%. As more firms began rayon production, du Pont's and the industry's return on investment began to drop. When 6 new firms entered the industry in 1930, bringing the number of producers to 20, average industry earnings for that year declined to 5% and du Pont suffered a net loss. 'From the beginning of the depression in 1929 through the succeeding recovery and the 1938 recession du Pont averaged 29.6 per cent before taxes on its cellophane investment. On its rayon investment it averaged only 6.3 per cent.' Id., at 62—63.
16
In 1924 two of La Cellophane's principal officials absconded with complete information on the cellophane process. A Belgian concern was then set up to use this process in making cellophane, and it later organized Sylvania as an American affiliate. Findings 615—618.
17
R. 2733—2736.
18
See memorandum du Pont submitted to prospective entrants. R. 3893.
19
See Rule 52(a), Federal Rules of Civil Procedure, 28 U.S.C.A.
20
118 F.Supp. at page 206.
21
R. 4154—4155.
22
See, e.g., American Tobacco Co. v. United States, 328 U.S. 781, 805—806, 66 S.Ct. 1125, 1137, 90 L.Ed. 1575.
23
See note 31, majority opinion.
24
Adams, The 'Rule of Reason': Workable Competition or Workable Monopoly? 63 Yale L.J. 348, 364.
25
Report of Attorney General's National Committee to Study the Antitrust Laws, p. 322. The majority decision must be peculiarly frustrating to the cigarette industry, whose economic behavior has been restrained more than once by this Court in the interest of competition. See American Tobacco Co. v. United States, 328 U.S. 781, 66 S.Ct. 1125, 90 L.Ed. 1575; United States v. American Tobacco Co., 221 U.S. 106, 31 S.Ct. 632, 55 L.Ed. 663.
26
'If cellophane is the 'market' that du Pont is found to dominate, it may be assumed it does have monopoly power over that 'market.' Monopoly power is the power to control prices or exclude competition. It seems apparent that du Pont's power to set the price of cellophane has only been limited by the competition afforded by other flexible packaging materials. Moreover, it may be practically impossible for anyone to commence manufacturing cellophane without full access to du Pont's technique.' Majority opinion, 76 S.Ct. 1005.
27
See notes 7 and 10, our dissent.
28
See United States v. Aluminum Co. of America, 2 Cir., 148 F.2d 416, 431.
| 78
|
351 U.S. 525
76 S.Ct. 946
100 L.Ed. 1387
Blazey CZAPLICKI, Petitioner,v.THE Vessel S. S. HOEGH SILVERCLOUD, her Boilers, Engines, Tackle, Etc., et al.
No. 342.
Argued April 24, 1956.
June 11, 1956.
Mr.Bernard Chazen, Hoboken, N.J., for petitioner.
Mr. J. M. Estabrook, New York City, for respondent The Hoegh Silvercloud.
Mr. Arthur J. Phelan, for respondent Hamilton Marine Contracting Co.
Opinion of the Court by Mr. Justice HARLAN, announced by Mr. Justice BURTON.
1
Czaplicki was injured in 1945 while working as a longshoreman on the 'SS Hoegh Silvercloud,' a vessel owned by the Norwegian Shipping and Trade Mission and operated by the Kerr Steamship Company. The injury occurred when some steps, constructed by the Hamilton Marine Contracting Company, gave way, causing Czaplicki to fall about five feet. At the time, Czaplicki was employed by the Northern Dock Company, which was insured for purposes of the Longshoremen's and Harbor Workers' Compensation Act1 by the Travelers Insurance Company. Travelers, which was also the insurer of the Hamilton Company, filed notice with the Compensation Commission that any compensation claim by Czaplicki would be controverted.2 Three weeks after the accident, Czaplicki elected to accept compensation rather than proceed against any third parties, and, one day later, a formal compensation award was entered by a Deputy Commissioner. Payments under the award were made by Travelers.
2
In 1952, Czaplicki filed a libel against the vessel, her owners and operators, and the Hamilton Company, claiming damages for his injuries on grounds of unseaworthiness and negligence.3 After various proceedings in the District Court for the Southern District of New York, the libel was dismissed as to all respondents,4 on the ground that Czaplicki was not the proper party libelant, since his election to accept compensation under the award had operated, under §§ 33(b) and 33(i),5 as an assignment to Northern and its insurer, Travelers, of his rights of action against third parties. The District Court also overruled Czaplicki's contention that the compensation award was invalid because of alleged procedural defects,6 and denied his motion to add Travelers 'as party libelant to sue in its behalf and as trustee for libelant,' or simply to add Travelers as a party.7 The District Court found it unnecessary, in light of this disposition of the case, to consider the defense of laches, which had been interposed by each respondent. The Court of Appeals, affirming the District Court, held the compensation award valid and the libel barred by laches; although it indicated some doubt as to the correctness of the District Court's decision on Czaplicki's right to maintain the suit, it did not pass on that question.8 We granted certiorari, 350 U.S. 872, 76 S.Ct. 118, because of the importance of these questions in the administration of the Longshoremen's and Harbor Workers' Compensation Act.
3
1. Czaplicki seeks to avoid the assignment question by attacking the compensation award itself, on the ground of asserted procedural defects.9 However, we think that the award must be treated as a valid one. In the first place, the alleged irregularity could not have prejudiced Czaplicki, since it resulted from a failure to afford his employer a procedural benefit which, we assume arguendo, the statute gives. The defect, if any, is one of which only the employer could complain; Czaplicki, who has not been in any way harmed by it, cannot use it as a vehicle for setting aside the award. Secondly, the supposed defect cannot be used to attack collaterally an otherwise valid award. The statute provides a means for contesting action by the Deputy Commissioner in compensation award cases,10 and unless that procedure is followed, the award becomes binding. In short, the defect was not one which would deprive the Deputy Commissioner of jurisdiction to enter an award.11
4
2. Under § 33(b) of the Compensation Act, Czaplicki's acceptance of the compensation award had the effect of assigning his rights of action against third parties to his employer, Northern. Travelers, as Northern's insurer, was in turn subrogated to all Northern's rights by § 33(i). Travelers, therefore, was the proper party to sue on those rights of action.12 Travelers was also the insurer of Hamilton, one of the third parties subject to suit. Hamilton had constructed the steps on which the accident occurred, and might be held liable if its negligence was the cause of Czaplicki's injuries; it might also be subject to a claim over by Kerr or the Norwegian Trade Mission if either of them should be held liable. Cf. Ryan Stevedoring Co. v. Pan-Atlantic S.S. Corp., 350 U.S. 124, 76 S.Ct. 232. The result is that Czaplicki's rights of action were held by the party most likely to suffer were the rights of action to be successfully enforced. In these circumstances, we cannot agree that Czaplicki is precluded by the assignment of his rights of action from enforcing those rights in an action brought by himself.
5
Although § 33(b) assigns to the employer 'all right of the person entitled to compensation to recover damages' against third parties when there has been acceptance of compensation under an award, this does not mean that the assignee is entitled to retain all damages in the event of a recovery against a third party. Instead, § 33(e) specifically apportions any such recovery between the assignee and the employee whose right of action it was originally, giving to the former an amount equal to the expenses incurred in enforcing the right, expenses of medical care for the employee, and any amounts paid and payable as compensation, and to the latter any balance remaining.13 In a very real sense, therefore, the injured employee has an interest in his right of action even after it has been assigned. Normally, this interest will not be inconsistent with that of the assignee, for presumably the assignee will want to recoup the payments made to the employee. Since the assignee's right to recoup comes before the employee's interest, and because the assignee is likely to be in a better position to prosecute any claims against a third party, control over the right of action is given to the assignee, who can either institute proceedings for the recovery of damages against a third person, 'or may compromise with such third person either without or after instituting such proceeding.' § 33(d), 33 U.S.C. § 933(d), 33 U.S.C.A. § 933(d). In giving the assignee exclusive control over the right of action, however, we think that the statute presupposes that the assignee's interests will not be in conflict with those of the employee, and that through action of the assignee the employee will obtain his share of the proceeds of the right of action, if there is a recovery. Here, where there is such a conflict of interests, the inaction of the assignee operates to defeat the employee's interest in any possible recovery. Since an action by Travelers would, in effect, be an action against itself, Czaplicki is the only person with sufficient adverse interest to bring suit. In this circumstance, we think the statute should be construed to allow Czaplicki to enforce, in his own name, the rights of action that were his originally.
6
We need not go so far as to say that by giving the employee an interest in the proceeds of a third-party action the statute places the assignee in the position of a fiduciary, cf. United States Fidelity & Guaranty Co. v. United States, 2 Cir., 152 F.2d 46, 48; all we hold is that, given the conflict of interests and inaction by the assignee, the employee should not be relegated to any rights he may have against the assignee, but can maintain the third-party action himself. In so holding, we recognize that one Court of Appeals has held otherwise under this same statute, see Hunt v. Bank Line, 4 Cir., 35 F.2d 136, as have certain state courts under similar statutes, see Taylor v. New York Central R. Co., 294 N.Y. 397, 62 N.E.2d 777; cf. Whalen v. Athol Mfg. Co., 242 Mass. 547, 136 N.E. 600. We think, however, that allowing suit by the employee in these circumstances is the proper way to ensure him the rights given by the Compensation Act.
7
Travelers is, of course, a proper party to this suit, since any recovery must first go to reimburse it for amounts already paid out. If Travelers is subject to the court's jurisdiction14 it should therefore be made a party, pursuant to Czaplicki's motion, assuming that there has been proper service of process.
8
3. Respondents contend that since Czaplicki did not, under § 33(a), 33 U.S.C. § 933(a), 33 U.S.C.A. § 933(a), elect to proceed against third parties, but rather chose to accept compensation, he can in no event revoke this election and maintain this suit. But, as this Court has already pointed out, 'election not to sue a third party and assignment of the cause of action are two sides of the same coin.' American Stevedores, Inc., v. Porello, 330 U.S. 446, 455, 67 S.Ct. 847, 852, 91 L.Ed. 1011. Czaplicki can bring this suit not because there has been no assignment, but because in the peculiar facts here there is no other procedure by which he can secure his statutory share in the proceeds, if any, of his right of action. For the same reason, we hold that the election to accept compensation, as a step toward the compensation award, does not bar this suit.
9
4. The Court of Appeals found it unnecessary to consider whether Czaplicki could maintain this suit, because it was held barred in any event on account of laches. The only reason given for this holding was that both the New York and New Jersey statutes of limitations, the two that might be applicable, had run. It is well settled, however, that laches as a defense to an admiralty suit is not to be measured by strict application of statutes of limitations; instead, the rule is that 'the delay which will defeat such a suit must in every case depend on the peculiar equitable circumstances of that case.' The Key City, 14 Wall. 653, 660, 20 L.Ed. 896. In cases where suit has been brought after some lapse of time, the question is whether it would be inequitable, because of the delay, to enforce the claim. Holmberg v. Armbrecht, 327 U.S. 392, 396, 66 S.Ct. 582, 584, 90 L.Ed. 743; Southern Pacific Co. v. Bogert, 250 U.S. 483, 488—489, 39 S.Ct. 533, 535—536, 63 L.Ed. 1099. 'Where there has been no inexcusable delay in seeking a remedy and where no prejudice to the defendant has ensued from the mere passage of time, there should be no bar to relief.' Gardner v. Panama R. Co., 342 U.S. 29, 31, 72 S.Ct. 12, 13, 96 L.Ed. 31. This does not mean, of course, that the state statutes of limitations are immaterial in determining whether laches is a bar, but it does mean that they are not conclusive, and that the determination should not be made without first considering all the circumstances bearing on the issue.
10
In this case, the District Court never passed on the defense of laches, which although properly put in issue was made irrelevant by the holding that, because of the statutory assignment of his right of action, Czaplicki could not maintain this action. Not only was there no decision on laches, but there was never an opportunity for Czaplicki to introduce evidence to justify the delay, since the suit was dismissed after preliminary hearings and argument on the issue of Czaplicki's 'standing.'
11
When the case reached the Court of Appeals, therefore, the record was incomplete on the issue of laches. There is nothing in the record to show that Czaplicki was given any more opportunity in the Court of Appeals to explain the delay than he had been given in the District Court.15 The only 'finding' made by the Court of Appeals16 was that the running of the statutes of limitations constituted laches, and that, as we have stated, was insufficient. From all that appears, Czaplicki may have failed to bring suit earlier because he relied on the assignee of the right of action to enforce what was presumably an interest common to both of them. The record does not disclose when Czaplicki discovered the assignee's conflicting interest, or whether there has been unjustifiable delay since that discovery. Nor has there been opportunity to prove the statement, made in an affidavit to the District Court, that the delay has in no way prejudiced the respondents. These are questions on which the parties should have been allowed to present evidence. The present record is inadequate to justify a holding that this action was barred by laches.
12
Since 'the existence of laches is a question primarily addressed to the discretion of the trial court,' Gardner v. Panama R. Co., supra, 342 U.S. at page 30, 72 S.Ct. at page 13, we remand the case to the District Court for further proceedings not inconsistent with this opinion.
13
Reversed and remanded.
14
Mr. Justice FRANKFURTER, concurring.
15
The disposition of a case is of prime importance to the parties. How a result is reached concerns the rational development of law. I agree with the Court's disposition of this case, but I would dispose of the main issue—the nature of Czaplicki's interest that survives his acceptance of compensation under the Longshoremen's and Harbor Workers' Compensation Act, 44 Stat. 1424, as amended, 52 Stat. 1164, 33 U.S.C. § 901 et seq., 33 U.S.C.A. § 901 et seq.—on the basis of the analysis made in United States Fidelity & Guaranty Co. v. United States, 2 Cir., 152 F.2d 46, 48. The reasoning of that case seems to me to carry out the scheme of the legislation with appropriate consistency.
16
'So far as concerns the tortfeasor's liability to the employee beyond the amount of workmen's compensation, no agreement between the tortfeasor and the employer can prejudice the employee, because, although it is true that, by accepting compensation, the employee assigns his claim against the tortfeasor to the employer or insurer, the assignee holds it for the benefit of the employee so far as it is not necessary for his own recoupment. The assignee is in effect a trustee, and, although it is true that the statute gives him power to compromise the whole claim, he must not, in doing so, entirely disregard the employee's interest.' 152 F.2d 46, 48.
17
Although this suit was brought directly against the tortfeasor, the Court directs that Travelers, the subrogee insurer, should be made a party. Since I deem the proper theory on which Czaplicki may recover despite his compensation award to be Travelers' fiduciary responsibility, I would direct reconstruction of this proceeding so that it should be against Travelers, while the vessel would be retained as a party.
1
44 Stat. 1424, as amended, 52 Stat. 1167, 33 U.S.C. § 901 et seq., 33 U.S.C.A. § 901 et seq.
2
The only reason given for controverting the claim was: 'Injured is undecided whether or not to sue the 3rd party and reserves the right to controvert for such other reasons as may later appear.'
3
In 1946, petitioner sued the Kerr Company in the New Jersey state courts, but the suit was dismissed for improper service of process. He brought a second suit against the same company in the New York state courts, but that suit was subsequently discontinued in 1947 by his then attorney. Petitioner claims that the commencement and discontinuance of that suit were without his knowledge. Petitioner had retained his present attorney by October 4, 1948, but the present libel was not filed until 1952.
4
110 F.Supp. 933; 133 F.Supp. 358; the opinion of Judge Ryan dismissing the suit against Hamilton Company and the Norwegian Trade Mission is not officially reported.
5
33 U.S.C. § 933(b), 33 U.S.C.A. § 933(b): 'Acceptance of such compensation under an award in a compensation order filed by the deputy commissioner shall operate as an assignment to the employer of all right of the person entitled to compensation to recover damages against such third person.'
33 U.S.C. § 933(i), 33 U.S.C.A. § 933(i): 'Where the employer is insured and the insurance carrier has assumed the payment of the compensation, the insurance carrier shall be subrogated to all the rights of the employer under this section.'
6
110 F.Supp. 933.
7
133 F.Supp. 358.
8
223 F.2d 189.
9
Section 19(c), 33 U.S.C. § 919(c), 33 U.S.C.A. § 919(c), provides that the Deputy Commissioner may either hold hearings on a compensation claim, or, 'if no hearing is ordered within twenty days' after notice of the claim is given to the employer and other interested parties, the Deputy Commissioner can decide the claim. In this case, the award was entered only one day after the claim was filed, on the same day that notice was sent to the employer, and no hearing was ordered or held. None of the parties requested a hearing.
10
§ 21, 33 U.S.C. § 921, 33 U.S.C.A. § 921.
11
Czaplicki also contends that the award made by the Deputy Commissioner was 'little more than a temporary or interlocutory order,' and should not be considered the kind of award which operates as an assignment. But the record indicates that what the Deputy Commissioner called an 'award' was in effect just that, and was sufficient to call into play the assignment provisions of the Act.
12
Aetna Life Ins. Co. v. Moses, 287 U.S. 530, 53 S.Ct. 231, 77 L.Ed. 477, was an action at law brought under this Act, which had been made applicable as a workmen's compensation law in the District of Columbia. It was held that the employer was the proper party to bring the action. Since that case was decided, § 33(i) has been added to the Compensation Act, providing that 'the insurance carrier shall be subrogated to all the rights of the employer under this section.' 52 Stat. 1168, 33 U.S.C. § 933(i), 33 U.S.C.A. § 933(i). As noted in the Moses case, 287 U.S. at page 542, 53 S.Ct. at page 233, note 3, it has long been the admiralty rule that the insurer subrogated to the rights of the insured can sue in his own name. See, e.g., Liverpool & Great Western Steam Co. v. Phenix Ins. Co., 129 U.S. 397, 462, 9 S.Ct. 469, 479, 32 L.Ed. 788; The Potomac, 105 U.S. 630, 634, 26 L.Ed. 1194. Travelers was, therefore, the proper party libelant had it chosen to sue in this case. Cf. United States v. Aetna Cas. & Surety Co., 338 U.S. 366, 380—381, 70 S.Ct. 207, 215, 94 L.Ed. 171. Doleman v. Levine, 295 U.S. 221, 55 S.Ct. 741, 79 L.Ed. 1402, again an action at law, is not in point, since in that case, unlike the case at bar, there was no complete assignment of the employee's right of action.
13
33 U.S.C. § 933(e), 33 U.S.C.A. § 933(e). The 'present value' of amounts payable by the employer as future compensation and medical benefits is computed and retained by the employer 'as a trust fund to pay such compensation and the cost of such benefits as they become due'. § 33(e)(1)(D), 33 U.S.C. § 933(e)(1) (D), 33 U.S.C.A. § 933(e)(1)(D).
14
Cf. Ettlinger v. Persian Rug & Carpet Co., 142 N.Y. 189, 36 N.E. 1055.
15
In his petition for rehearing to the court below, Czaplicki asked for 'an opportunity to prove the facts which would negative laches,' although he did not attempt to set forth the facts on which he expected to rely. The petition was denied without opinion.
16
Cf. Admiralty Rules, No. 46 1/2, 28 U.S.C.A.
| 78
|
351 U.S. 321
76 S.Ct. 982
100 L.Ed. 1220
The DENVER & RIO GRANDE WESTERN RAILROAD CO., Appellant,v.UNION PACIFIC RAILROAD COMPANY et al. UNION PACIFIC RAILROAD COMPANY et al., Appellants, v. UNITED STATES of America, Interstate Commerce Commission, et al. UNITED STATES of America, Interstate Commerce Commission and Secretary of Agriculture, Appellants, v. The UNION PACIFIC RAILROAD COMPANY et al. WASHINGTON PUB. SERV. COMM'N, Public Utilities Comm'r of Oregon, et al., Appellants, v. The DENVER & R.G.W.R. CO. UNION PACIFIC R. CO., Chicago & N.W.R. Co., et al., Appellants, v. The DENVER & R.G.W.R. CO. UNITED STATES of America, Interstate Commerce Commission, Appellants, v. The DENVER & R.G.W.R. Co.
Nos. 117, 118, 119, 332, 333, 334.
Argued April 23 and 24, 1956.
Decided June 11, 1956.
[Syllabus from pages 321-322 intentionally omitted]
Mr.Frank E. Holman, Seattle, Wash., for Denver & Rio Grande R. co.
Mr. Elmer B. Collins, Omaha, Neb., for Union Pacific R. Co.
Mr. Robert L. Simpson, Olympia, Wash., for State of Washington.
Mr. Bert L. Overcash, Lincoln, Neb., for State of Nebraska.
Mr. Robert W. Ginnane, Washington, D.C., for I.C.C., et al.
Mr. Justice BLACK delivered the opinion of the Court.
1
These cases all involve the validity of a single order of the Interstate Commerce Commission establishing through railroad routes and prescribing joint through rates for carriage of certain goods over the routes. The Commission's order was made after lengthy hearings upon complaint of the Denver & Rio Grande Western Railroad Company. The Rio Grande's main line runs from Ogden, Salt Lake City, and Provo, Utah, across much of Colorado to Denver, Pueblo, and Trinidad. The chief controversy involved in this case is between the Rio Grande and the Union Pacific Railroad Company. The Union Pacific lines which are relevant here run from points in Washington and Oregon through Idaho, Utah, Wyoming, Colorado, Kansas, and Nebraska, going as far east as Omaha and Kansas City. The Union Pacific and Rio Grande connect at Ogden, Salt Lake City, and Provo, Utah, and at Denver, Colorado. The connection at Ogden is known as the Ogden Gateway, meaning the gateway between the northwestern states served by the Union Pacific and states to the south and east served by the Rio Grande. The Union Pacific has used its strategic position in the northwest territory in such a way that practically all traffic between the Northwest, Denver and points east and south of Denver goes over its lines. For this reason the Northwest is often referred to as 'closed door' territory. This situation caused the Rio Grande to file its complaint with the Commission. It charged that the Union Pacific had agreements with other connecting railroads named defendants under which goods could be carried to and from the Northwest at joint through rates, but that the only way the Rio Grande could carry goods to and from this area was by exacting higher 'combination rates,' which are the sum of local rates. These high rates practically bar the Rio Grande as a connecting carrier for through shipments to and from the Northwest. The Rio Grande asked the Commission to order the Union Pacific to establish and maintain for the future 'just, reasonable and non-discriminatory competitive joint through rates' with the Rio Grande. It charged that the Union Pacific's failure to establish and maintain such rates violated §§ 1(4), 3, 15(1), and 15(3) of the Interstate Commerce Act.1 Section 15(1) authorizes the Commission to proscribe individual or joint rates or practices that are 'unjust or unreasonable or unjustly discriminatory or unduly preferential or prejudicial' and to prescribe rates and practices that are 'just, fair, and reasonable.' Section 15(3) empowers the Commission to establish through routes and joint rates whenever deemed by the Commission 'to be necessary or desirable in the public interest.' Section 15(4), which is very important in this controversy, places restrictive conditions upon the Commission's power to establish through routes under § 15(3) when the establishment of a through route would require a railroad 'without its consent, to embrace in such route substantially less than the entire length of its railroad and of any intermediate railroad operated in conjunction and under a common management or control therewith, which lies between the termini of such proposed through route * * *.'2 This provision is generally referred to as a prohibition against making a railroad 'short-haul' itself. Among other findings the Commission must make under § 15(4) before establishing a through route which requires a railroad to short-haul itself is that the new route 'is needed in order to provide adequate, and more efficient or more economic, transportation * * *.'
2
The Rio Grande's petition before the Commission alleged that through routes with the Union Pacific already existed through the Ogden Gateway. It contended that they had been created and used by the Union Pacific. On this basis Rio Grande claimed that the restrictive conditions of § 15(4) did not apply and that the Commission need not concern itself with those conditions but should proceed to establish reasonable joint rates under § 15(3). After hearing much evidence the Commission rejected this contention and found that the through routes claimed by Rio Grande did not exist.3 The Commission went on to find, however, that through routes should be established with reference to certain commodities such as fruits, perishable foods, and livestock in a limited geographical area. The Commission found, in accordance with § 15(4) that these new routes were needed 'to provide adequate and more economic transportation * * *.' It also found as required by § 15(3) that through routes and joint rates for the specified commodities were 'necessary and desirable in the public interest.' 287 I.C.C. 611, 659.
3
On the basis of its findings the Commission ordered the Union Pacific to establish through routes for the specified commodities and to establish joint rates the same as applied on its own and other connecting lines. The Union Pacific considered itself aggrieved because the order required establishment of some through routes and joint rates. The Rio Grande considered itself aggrieved both because of the geographical limitations of the Commission's order and because joint rates were not established for all commodities. The Union Pacific challenged the I.C.C. order in a three-judge United States District Court in Nebraska and the Rio Grande challenged it in a three-judge United States District Court in Colorado. See 28 U.S.C. §§ 1336, 2284, 2321—2325, 28 U.S.C.A. §§ 1336, 2284, 2321—2325. The Colorado court upset the order on a single ground. It held that there was no substantial evidence to support the finding that through routes were not in existence. Had the Commission found there were established through routes, the Colorado court reasoned, much broader relief for the Rio Grande might have been ordered, since the restrictions of § 15(4) would not have been applicable. Consequently the Colorado court remanded the case to the Commission for further consideration. D.C., 131 F.Supp. 372. The Nebraska court accepted the Commission's finding that no through routes were in existence. It then held that there was evidence before the Commission sufficient to support the finding under § 15(4) that through routes were needed 'in order to provide adequate and more economic transportation' for specified commodities shipped from the Northwest to initial destination points on the Rio Grande for 'in-transit privileges incident to reshipment to points east of Denver * * *.' D.C., 132 F.Supp. 72, 82. The Nebraska court declined, however, to sustain the Commission's action with reference to shipments not requiring such transit services. Both District Court decrees are now before us on direct appeal under 28 U.S.C. §§ 1253 and 2101(b), 28 U.S.C.A. §§ 1253, 2101(b). They were consolidated for oral argument and we treat them together here. It is convenient to take up first the Colorado court's holding.
4
In considering the question of through routes under § 15(4) we begin with our recent holdings and opinions in Thompson v. United States, 343 U.S. 549, 72 S.Ct. 978, 96 L.Ed. 1134; United States v. Great Northern R. Co., 343 U.S. 562, 72 S.Ct. 985, 96 L.Ed. 1142. We there emphasized the purpose of § 15(4) to bar the Commission from compelling railroads to establish through routes resulting in trunkline 'short-hauls' without faithful observance of restrictive conditions imposed by that section. At the same time we recognized that Commission action is not necessary to the creation of through routes. We pointed out that a through route is ordinarily a voluntary arrangement, express or imlied, between connecting carriers, and that the existence of such an arrangement depends on the circumstances of particular cases. We said in Thompson v. United States, supra, 343 U.S. at page 557, 72 S.Ct. at page 983, that 'In short, the test of the existence of a 'through route' is whether the participating carriers hold themselves out as offering through transportation service.' Findings of through routes can therefore be made on the basis of express agreements between carriers or on the basis of inferences drawn from continuous practices sufficient to show that through routes exist even though not provided for in formal contracts or tariffs. The question in each case is one of fact. Cf. Through Routes and Through Rates, 12 I.C.C. 163, 166—167. The Colorado court viewed the evidence here as showing beyond dispute the existence of through routes both by formal tariffs and by long railroad practices. Whether the evidence could have justified the Commission in finding the existence of through routes we need not determine. We are satisfied, however, that the evidence before the Commission did not compel it to make such a finding and that its conclusion that the through routes claimed were not in existence is supported by substantial evidence.
5
There was evidence that as early as 1897 the Union Pacific and lines it controlled did establish through routes to and from points in the 'closed' northwest territory through the Ogden Gateway, and did establish joint through rates with the Rio Grande on the same basis as the joint through rates on Union Pacific's own lines. But these joint rates were canceled by Union Pacific in amended tariffs published between 1906 and 1912. Apparently there was no language in the published amended tariffs expressly and formally declaring that the through routes by way of the Ogden Gateway were also to be deemed closed. The amended tariffs, however, resulted in very high combination rates for northwest traffic transported by the Rio Grande. The effect of these high rates has been greatly to handicap if not actually to close the Rio Grande as an artery for through traffic between the Northwest, Denver and points south and east. Of course the effect of such rates might not be enough standing alone to show a voluntary abandonment of the through routes. See Virginia R. Co. v. United States, 272 U.S. 658, 666, 47 S.Ct. 222, 225, 71 L.Ed. 463; Thompson v. United States, supra, 343 U.S. at pages 556—558, 72 S.Ct. at pages 982, 983. At the same time it cannot be said that the Union Pacific's failure formally to declare the through routes abandoned in 1906 (when it canceled joint rates) automatically left the through routes in existence for § 15(4) purposes in 1949 when this litigation started. Cancellation of the rates in 1906 without formal cancellation of the routes is only a circumstance to be considered along with other circumstances in determining whether through routes now exist. The Colorado court relied on railroad practices as other circumstances which, considered with the failure expressly to abandon through routes, were sufficient to compel the Commission to hold that through routes did exist. We turn to that.
6
At best for the Rio Grande the evidence of railroad practices with reference to the continued existence of through routes showed the following. Despite the high combination rates a small number of shipments continue to trickle through the Ogden Gateway to and from the closed northwest territory. in 1948, which the Commission considered a representative year, a number of carload shipments moved on through bills of lading along the alleged through routes. But none of them coming from the Northwest went further than points on the Rio Grande in Colorado also served by the Union Pacific and connecting lines. There were a few shipments of various commodities from east and south of Denver which went by way of the Rio Grande through the Ogden Gateway. The total shipments over the alleged through routes, however, were no more than a fractional part of one percent of the traffic carried to and from the Northwest by way of the Union Pacific routes. It is also undisputed that through routes and joint rates exist for eastbound shipments of sheep and goats. During World War II some Army troop and supply trains moved over the Rio Grande on through bills of lading. In addition to the foregoing some traffic moved over the Rio Grande in 1949 when snow storms blocked the Union Pacific route through Wyoming. These movements were made under service orders of the Commission, which did not exercise its authority under § 15(4) to establish emergency through routes.
7
The Union Pacific produced evidence tending to show that there were no through routes. It quite plainly appears from the record that there has been a long-standing struggle between the Union Pacific and the Rio Grande over the efforts of the Union Pacific to keep the Ogden Gateway closed. We think the record supports the finding of the Commission that:
8
'There is no indication that any of the defendants has ever solicited any traffic from and to the areas here concerned for routing over a Rio Grande route by which a higher combination rate applied, or has ever used such a Rio Grande route except where called upon to do so by routing specified by the shipper or by a prior connecting carrier. In other words, so far as this record shows, 'the carriers' course of business' has been and is to use the Union Pacific routes except where called upon to use the Rio Grande routes by force of shippers' or connecting carriers' routing. The whole course of conduct of the Union Pacific, so far as revealed, has been for many years and is now to guard jealously its long haul and not open commercially the Rio Grande routes on this traffic.' 287 I.C.C., at 618.
9
We ahhere to the 'holding out' test of the Thompson case. The evidence before the Commission was not such as to compel it to find that the Union Pacific held itself out as offering through service over the Rio Grande lines. It was error for the Colorado District Court to set aside the Commission's finding and to remand the case to the Commission. This brings us to a consideration of the Nebraska District Court's action.
10
The Commission required the Union Pacific to establish through routes and joint rates with the Rio Grande for the carriage of certain commodities including livestock, fresh fruits and vegetables, frozen foods, butter, and eggs.4 The order rested on the Commission's conclusion that such through routes and joint rates were 'necessary and desirable in the public interest, in order to provide adequate and more economic transportation * * *.' 287 I.C.C., at 659. This conclusion was based on findings from a vast amount of evidence both oral and written. The pertinent language of § 15(4) allows the Commission to establish through routes where 'needed in order to provide adequate, and more efficient or more economic, transportation.' The dispute in the Nebraska court and here relates principally to the adequacy of the existing transportation services. The efficiency of Union Pacific services was established beyond dispute.
11
Section 15(4) empowers the Commission to consider the interests of shippers and the kind of services they get and need as well as the interests of carriers in determining whether additional routes should be established to provide 'adequate' and 'more economic' transportation service. We have held that in determining this question the Commission should look beyond the mere adequacy of the carrier's physical operations 'to the broader public interest which embraces service to shippers and the rates they pay.' Pennsylvania R. Co. v. United States, 323 U.S. 588, 591—593, 65 S.Ct. 543, 544, 89 L.Ed. 478. The duty of the Commission, as we there stated, is to try to strike a fair balance in satisfying the needs of shippers, railroads, and the public. This of course calls for the Commission to exercise its informed judgment, having in mind its statutory obligation to develop, coordinate and preserve an adequate national transportation system.5 This it did. Relying on our interpretation of § 15(4) in the Pennsylvania Railroad case, the Commission considered the various interests here. It found that: 'Because of their generally perishable nature, food articles * * * must be moved to market with expedition and care, and over as many routes as possible. This requires that many routes be open in order that unnecessary interruptions of the free flow of such commodities may be avoided and that as much flexibility as possible in the distribution process be permitted. A number of services, not only at origin and destination, but en route, which are not usually required in the movement of ordinary traffic, must be provided for these perishable and semiperishable commodities.' 287 I.C.C., at 656. There are facilities along the Rio Grande route for feeding and grazing livestock in transit, and for partial unloading, storing or processing other shipments in transit. As a result shippers in the northwest territory were found to be 'debarred from effective participation in the widespread system developed for the marketing of such commodities' and processors, shippers and dealers along the Rio Grande were found to be at a disadvantage in competing with those on the Union Pacific. For the specified commodities the Commission found the Union Pacific routes to be 'inadequate and less economical than are the Rio Grande routes.'6 The Nebraska District Court sustained the Commission's order with reference to shipments which required transit services on the Rio Grande. We agree with this portion of the holding. We cannot say that the Commission acted in excess of its authority in concluding, on the mass of evidence before it, that through routes and joint rates on the specified commodities were needed to provide adequate and more economic transportation and were necessary in the public interest.
12
But the scope of the Commission's order was cut down by the Nebraska court insofar as it established through routes and joint rates on shipments that did not require transit services such as we have mentioned. We disagree with the Nebraska District Court in this respect. The evidence showed and the Commission found that in marketing food and other perishable products it is a general practice among railroads to allow diversion of carloads in transit as markets are found and sales are made. The successful operation of this practice requires the existance of joint through rates to the final market, since diversion or reconsignment would often, as a practical matter, be unavailable to a shipper who is compelled to reconsign his goods at high combination rates. The Commission found that 'If a shipment reaches a point through which a combination of rates applies and the sale is lost, it is frequently necessary to dispose of the shipment at that point at a forced or distress price. Such points are called closed or pocket markets.' 287 I.C.C., at 642. To illustrate its conclusion that combination rates result in inadequate transportation service in situations where shippers are compelled to reconsign, the Commission noted that: 'Idaho producers are in competition with shippers in other producing areas and find it difficult to compete on shipments routed over the Rio Grande via Ogden or Salt Lake City. One Idaho shipper has made few sales of potatoes in the Southwest in the last several years because of pocket markets there.' 287 I.C.C., at 643. Pocket markets, of course, exist because reconsignment is possible only at high combination rates. We see no reason why a shipper's privilege to have his goods reconsigned at joint rates should not be considered on the same basis as transit services in determining the adequacy and economy of existing transportation. We think it was error for the Nebraska court to narrow the scope of the Commission's order by excluding shipments of commodities which so urgently need the advantage of reconsignment privileges at joint rates.
13
Many other arguments are made against the Commission's order. It is pointed out, for example, that the Rio Grande road has more curves than the Union Pacific. Its grades are steeper. Consequently its traffic is sometimes slower. It is contended that the evidence as a whole is insufficient to justify the holding that the esablishment of through routes will be of such great advantage to shippers and the public that the Union Pacific should be compelled to short-haul itself. We are not unmindful of the force of the arguments made by the Union Pacific and by those who have intervened on its side. It is entirely possible that the Commission could have made findings contrary to those it did make. But on the whole we are unable to say that the Commission did not strike a fair balance in finding that the evidence required the establishment of these through routes and joint rates. After consideration of all the contentions made, we hold that the Nebraska court should have sustained the Commission's order in full.7 Since the Commission's order is justified under §§ 15(1), 15(3) and 15(4) we have no occasion to consider contentions raised under §§ 3(1) and 3(4).
14
The judgment of the District Court of Colorado is reversed with directions to dismiss the bill. The judgment of the Nebraska District Court is affirmed insofar as it affirmed the order of the Commission, and is reversed insofar as the court refused to enforce the Commission's order.
15
It is so ordered.
16
Mr. Justice FRANKFURTER, dissenting.
17
I agree with the Court that through routes were not in existence and that joint rates are therefore not empowered under § 15(3) of the Interstate Commerce Act, unqualified by § 15(4). 54 Stat. 898, 911—912, 49 U.S.C. § 15(3), (4), 49 U.S.C.A. § 15(3, 4). The controversy thus turns on the enforcement of congressional policy expressed as follows in § 15(4):
18
'In establishing any such through route the Commission shall not (except as provided in section 3, and except where one of the carriers is a water line) require any carrier by railroad, without its consent, to embrace in such route substantially less than the entire length of its railroad and of any intermediate railroad operated in conjunction and under a common management or control therewith, which lies between the termini of such proposed through route, (a) unless such inclusion of lines would make the through route unreasonably long as compared with another practicable through route which could otherwise be established, or (b) unless the Commission finds that the through route proposed to be established is needed in order to provide adequate, and more efficient or more economic, transportation: Provided, however, That in prescribing through routes the Commission shall, so far as is consistent with the public interest, and subject to the foregoing limitations in clauses (a) and (b), give reasonable preference to the carrier by railroad which originates the traffic. * * *'
19
As is true so often in applying regulatory legislation, the general approach—that is, the starting point—may be determinative of the result. It makes a vital difference whether § 15(4) is deemed a restriction on the power of the Interstate Commerce Commission which is to be closely confined and sharply construed or whether it is deemed to express a legislative command which ought to be heeded and not slightingly enforced. The fact of the matter is that we are dealing with a provision of the law which the Commission has long considered undesirable from the point of view of a national railroad policy and whose repeal it has consistently urged upon Congress. See the history set forth in Thompson v. United States, 343 U.S. 549, 554—556, 72 S.Ct. 978, 981, 982, 96 L.Ed. 1134. Although Congress has, from the time of the Commission's creation and especially in recent years, relied on the Commission as its expert adviser on policy, and legislation has largely reflected the Commission's recommendations, the latter's persistence in recommending repeal of § 15(4) has been matched and overborne by the persistence of Congress in retaining it. Congress has emphatically made clear that in its view the national interest requires the protection of railroads against being short-hauled. Encouragement should not be given to disregard of that policy, even if such disregard occurs through inadequate observance attributable to an unconscious desire to restrict the scope of the statute. In short, when an order of the Commission is brought under judicial scrutiny, and challenge is made that the safeguards of § 15(4) have not been observed, it is the duty of this Court to apply the policy expressed by that section. If the requisite findings or conclusions are ambiguous or unclear, or the policy of the section is slighted, our duty demands remand to the Commission to dispel ambiguity or to secure clarity and obedience to the policy.
20
It is my view that, even though evidence may be found in the record to support a portion of the order, the Commission did not support the portion on that basis but, on the contrary, appears to have justified the whole order on considerations that collide with congressional policy. The proceedings should therefore be returned to the Commission and the order ought not to be sustained in whole or in part. I will summarize the reasons for this conclusion.
21
The Commission ordered the establishment of through routes and joint rates by the Union Pacific with the Rio Grande for shipments of livestock and certain perishable agricultural products originating in the northwest (excluded) territory and destined for that part of the United States which the Nebraska District Court roughly described as "East of Denver."* 132 F.Supp. 72, 75, note 1. Apparently, through routes and joint rates were already in existence for shipments via the Ogden Gateway between the northwest territory and intermediate points on the Rio Grande, originating or terminating at those intermediate points. Joint through rates, however, were not generally in effect over the Rio Grande to or from the Colorado or Utah common point territory (e.g., Denver, Colorado Springs, and Pueblo; Ogden, Salt Lake City, and Provo) of the Rio Grande and the Union Pacific and other defendants, or for transcontinental traffic between the northwest territory and points east of the Colorado common points. The Commission did not order through routes and joint rates to the Utah or Colorado common points or to a large area which is in fact east of Denver. (See description in footnote*.) Through routes and joint rates over the Rio Grande also were not ordered for westbound traffic to the northwest territory originating east of the Colorado common points, except for granite and marble monuments from origins in Vermont and Georgia. The Commission found that it was 'necessary and desirable in the public interest, in order to provide adequate and more economic transportation,' 287 I.C.C. 611, 659, to establish the specified through routes and joint rates. The Commission gave this justification for its finding:
22
'* * * The growth of our population and the development of the country have required a constantly expanding flow of diverse commodities. * * * Movements of transcontinental proportions are involved in important instances. * * * A complex but efficient marketing system has been evolved to provide as orderly a distribution of food commodities as possible. Adequate transportation facilities and services are required for the proper functioning of the system. Because of their generally perishable nature, (the enumerated) food articles * * * must be moved to market with expedition and care, and over as many routes as possible. This requires that many routes be open in order that unnecessary interruptions of the free flow of such commodities may be avoided and that as much flexibility as possible in the distribution process be permitted. A number of services, not only at origin and destination, but en route, which are not usually required in the movement of ordinary traffic, must be provided for these perishable and semiperishable commodities.' 287 I.C.C., at 655—656.
23
The Commission also found support for its conclusion that shippers of these products are debarred from participation in the widespread marketing system in the fact that 'in-transit' privileges on the Rio Grande, such as stop-off for partial unloading or processing, or for grazing of cattle, are not available to shippers of these commodities from the northwest territory, except at the higher combination rates.
24
The Commission considered through routes and joint rates to points 'east of Denver' as a unitary problem and saw no difference between shipments destined initially to intermediate points on the Rio Grande and shipments destined initially to points 'east of Denver.' The Nebraska District Court, however, found nothing in the evidence to support a finding that the transportation service furnished by Union Pacific on through service between the northwest territory and points 'east of Denver' was inadequate, and as to livestock this restriction was not contested by the Commission on this appeal. The Nebraska District Court, therefore, narrowed the order to require through routes and joint rates only for those carloads originating in the northwest territory and consigned to initial destination points on the Rio Grande west of Denver, Pueblo, and Trinidad, Colorado, which require 'in-transit' privileges incident to reshipment to points east of those places.
25
The Court, rejecting the narrowed construction by the Nebraska District Court, affirms the Commission's order as written. In doing so, however, it does not rely on the reasons given by the Commission in support of its conclusion, but rather it affirms on a different basis. How can we know whether, and to what extent, the Court's reasons influenced the Commission, or would influence it, in making its decision? The report certainly indicates that the Commission thought its own reasoning sufficient to support the whole order. Once the Commission's reasoning for a conclusion is found wanting, the conclusion is necessarily impaired. While the judgment of a lower court may be sustained by this Court on a ground other than that on which it was rested below, see Langnes v. Green, 282 U.S. 531, 534—539, 51 S.Ct. 243, 244, 246, 75 L.Ed. 520; Helvering v. Gowran, 302 U.S. 238, 245 247, 58 S.Ct. 154, 157, 158, 82 L.Ed. 224, the legal relation between the Commission and the courts is of a very different order from that of a lower court and a reviewing court. A Commission having defined and limited delegated power must justify the exercise of that power by findings that support it and by evidence that supports the findings. When regard is had for the complicated technical nature of the problems and the voluminousness of the records in the important cases that come before the Commission, a fair discharge of its functions precludes casting upon a reviewing court the task of quarrying through a record to find for itself adequate evidence to permit the effectuation of orders of the Commission.
26
The precise function of findings is to make practicable scrutiny by the courts in order to determine whether the Commission has kept within the bounds legislatively defined. To be sure, the Commission's findings are not binding in the sense that attack cannot be made on them for lack of evidence. Interstate Commerce Commission v. Louisville & Nashville R. Co., 227 U.S. 88, 91—94, 33 S.Ct. 185, 186, 188, 57 L.Ed. 431. The Commission cannot it has not purported to do so here—pass on to the Court an unanalyzed summary of a long proceeding and call it findings. While findings need not be formulated in an enumerated sequence, helpful as that would be, they must at least appear in a Commission's decision with unambiguous clarity, and they must be logically related to its conclusion. The justification the Commission has given cannot be rejected and a new justification found by the Court to satisfy the requirement of a foundation for judicial review. Securities and Exchange Commission v. Chenery Corp., 318 U.S. 80, 92—95, 63 S.Ct. 454, 461, 462, 87 L.Ed. 626. After all, it is the Commission which Congress has established as the expert in this field.
27
The Commission treated the whole problem of joint rates alike, whether the shipment was initially destined for intermediate points on the Rio Grande or whether it was a through shipment. The Court now finds one justification, the inability to use available 'in-transit' privileges of the Rio Grande, to support the order in the former situation, and another justification, elimination of 'pocket markets,' to support the order in the latter situation. It does not rely on what appears to have been the principal, if not the only, reason which the Commission thought justified its whole order, the necessity for the specified products to be able to move to market 'over as many routes as possible.' Indeed, that viewpoint of the Commission is directly contrary to the congressional policy expressed in § 15(4). The theory of that section is that products are not to be able to move to markets 'over as many routes as possible' when that would involve short-hauling a carrier without its consent on the proposed through route, unless, among other things, the transportation already in existence is inadequate. To make available to shippers as many routes to market as possible is a policy which the Commission has long urged but which the Congress has resolutely rejected. To find inadequacy of service on a short-hauled carrier in that other routes are not made available would virtually nullify § 15(4).
28
It may well be that what are somewhat misleadingly called 'in-transit' privileges justify joint through rates to shipments stopped at intermediate points on the Rio Grande for those privileges, and on similar reasoning joint through rates might be justified for shipments initially consigned to intermediate points on the Rio Grande and thereafter reconsigned to points 'east of Denver' if the sale is lost, subject to findings being made concerning reconsignment privileges on the Rio Grande. In both situations it is a fiction to speak of a single shipment on which the Union Pacific would be short-hauled should the proposed through route go into effect. The situation involves two separate shipments for which, under normal railroad practice, only the rate of a single continuous shipment over the whole route is charged. On neither of these shipments is Union Pacific being short-hauled because it is capable of performing neither. In this sense, Union Pacific service is of course not 'adequate'; it is non-existent. But the Commission did not found its order on such an analysis, and I cannot confidently surmise that it would have ordered the establishment of through routes and joint rates on this basis. Such a determination should be left for the Commission.
29
The Court also affirms that part of the Commission's order establishing through routes and joint rates for shipments destined initially to points 'east of Denver.' It does so both with respect to the specified agricultural products and with respect to livestock, even though the Commission did not before us contest the Nebraska District Court's elimination of through routes and joint rates for livestock to points 'east of Denver' for want of evidence to support a finding of inadequacy of service. This Court relies for support of this very important portion of the Commission's order on a few paragraphs of the Commission's report under the heading 'Proponents' Testimony' where some testimony concerning 'pocket markets' is set forth. The Commission in its 'General Discussion and Ultimate Fact Findings' makes no reference to the 'pocket market' problem as supporting its order. Indeed, the discussion of 'pocket markets' seems related only to the refusal of the Union Pacific to establish joint through rates on shipments going through certain points even over its own lines (because the points involved are off the main line and substantial back hauls or out-of-line hauls are required), and has nothing at all to do with the Rio Grande. Moreover, the order requiring the Union Pacific to establish through routes with the Rio Grande prescribes that there be maintained over such routes only joint rates 'the same as those maintained and applied on like traffic from and to the same points over routes embracing the lines of the Union Pacific Railroad Company through Wyoming.' From all that appears on the record before us, this could not affect the 'pocket markets' complained of because at those points there are no joint through rates over the Union Pacific. Since the establishment of through routes and joint rates for shipments destined initially to points 'east of Denver' appears to have no effect on 'pocket markets,' it is difficult to understand how the 'pocket market' situation can be used to justify the establishment of such routes and rates.
30
The upshot of all this is that after the Nebraska three-judge District Court disagreed about the justification for the order and the majority thought it could be saved by narrowing it, this Court reinstates the whole order, but on a different basis from that of the Commission, and with respect to a major portion of the order, it does so on a ground which appears to have no support in the Commission's findings. I do not say that no through routes or joint rates can be established through the Ogden Gateway. But I do believe that it is neither for the District Court nor for this Court to speculate what the Commission would have done if it were required to disregard some of its important views on policy, as this Court has disregarded them. I also believe that it is not our duty to find reasons to support the Commission's order which the Commission on full consideration did not summon to its support. This is a striking instance of a case requiring remand to the Commission for clarification and reconsideration of the basis for decision. See United States v. Chicago, M., St. P. & P.R. Co., 294 U.S. 499, 510—511, 55 S.Ct. 462, 467, 79 L.Ed. 1023.
31
Mr. Justice HARLAN, dissenting.
32
I agree with the opinion of Mr. Justice FRANKFURTER, except that I would consider an order of the Commission limited to establishing through routes and joint rates on shipments destined initially to intermediate points on the Rio Grande to be supported by the present findings. Accordingly, I would affirm the judgment of the Nebraska District Court, which remanded the case to the Commission to allow it to determine whether such a limited order would be in the public interest and for any further proceedings not inconsistent with its opinion.
1
24 Stat. 379, 380, 384, as amended, 49 U.S.C. §§ 1(4), 3, 15(1), 15(3), 49 U.S.C.A. §§ 1(4), 3, 15(1, 3). Section 1(4) makes it the duty of common carriers 'to establish reasonable through routes with other such carriers, and just and reasonable rates * * *.' And § 3(4) enjoins carriers to 'afford all reasonable, proper, and equal facilities for the interchange of traffic' without discrimination or undue prejudice.
2
24 Stat. 384, as amended, 49 U.S.C. § 15(4), 49 U.S.C.A. § 15(4).
3
Five Commissioners thought that through routes were in existence; five were of the opinion that they were not. Under I.C.C. practice this meant that the Rio Grande had failed to prove its allegation that through routes existed.
4
The Commission ordered the railroads: 'to maintain through routes, via Ogden or Salt Lake City, Utah, in connection with the line of the complainant, for the interstate transportation, in carloads, of granite and marble monuments from origins in Vermont and Georgia to destinations in the excluded territory in the northwest area, as described in the report, and of ordinary livestock, fresh fruits and vegetables, dried beans, frozen poultry, frozen foods, butter, and eggs, in carloads, from origins in the described excluded territory to destinations in the United States south and east of a line drawn along the southern boundary of Kansas, thence the eastern boundary of Kansas to but not including Kansas City, thence immediately west of points on the Missouri River from Kansas City, Kans., to Omaha, Nebr., thence immediately north of points on the lines of the Union Pacific Railroad Company and the Chicago and North Western Railway Company from Omaha to Chicago, Ill., including destinations in the lower peninsula of Michigan and in Oklahoma and Texas; and to apply on such traffic, over such through routes, joint rates the same as those maintained and applied on like traffic from and to the same points over routes embracing the lines of the Union Pacific Railroad Company through Wyoming.'
5
54 Stat. 899. See also New England Divisions Case, Akron, C. & Y.R. Co. v. United States, 261 U.S. 184, 43 S.Ct. 270, 67 L.Ed. 605; United States v. Great Northern R. Co., 343 U.S. 562, 575—576, 72 S.Ct. 985, 992, 993, 96 L.Ed. 1142.
6
Because of the inability of most granite and marble monument retailers to purchase entire carload lots the Commission found 'an urgent need for the establishment of joint through rates on this traffic to destinations in the excluded territory with stop-off privileges at intermediate points on the Rio Grande.' 287 I.C.C., at 638.
7
In reaching our conclusion we have not overlooked attacks on the breadth of the order with respect to marble, granite, and livestock shipments, nor challenges to that part of the order correcting discrimination in favor of the Bamberger Railroad.
*
It used the phrase to designate the points included in the order with respect to which through routes and joint rates were ordered established for livestock and certain agricultural commodities by the Union Pacific with the Rio Grande. The Commission in its order defined these points as:
'destinations in the United States south and east of a line drawn along the southern boundary of Kansas, thence the eastern boundary of Kansas to but not including Kansas City, thence immediately west of points on the Missouri River from Kansas City, Kans., to Omaha, Nebr., thence immediately north of points on the lines of the Union Pacific Railroad Company and the Chicago and North Western Railway Company from Omaha to Chicago, Ill., including destinations in the lower peninsula of Michigan and in Oklahoma and Texas * * *.'
| 78
|
351 U.S. 445
76 S.Ct. 904
100 L.Ed. 1311
The COLD METAL PROCESS COMPANY and The Union National Bank of Youngstown, Ohio, Trustee, Petitioners,v.UNITED ENGINEERING & FOUNDRY COMPANY.
No. 76.
Argued Feb. 28, 1956.
Decided June 11, 1956.
Mr.
William H. Webb, for petitioner.
Mr. Jo. Baily Brown, Pittsburg, Pa., for respondent.
Mr. Justice BURTON delivered the opinion of the Court.
1
This is a multiple claims action in which the District Court entered a judgment disposing of but one claim. Pursuant to Rule 54(b) of the Federal Rules of Civil Procedure, as amended in 1946, 28 U.S.C.A.,1 that court expressly determined that there was no just reason for delay and expressly directed the entry of judgment. Thereupon, an appeal was taken to the Court of Appeals, and the issue before us is whether the latter court has jurisdiction to entertain that appeal under 28 U.S.C. § 1291, 28 U.S.C.A. § 1291,2 although an unadjudicated counterclaim awaits disposition in the District Court. The issue is comparable to that decided in Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 76 S.Ct. 895, except that here the unadjudicated claim is a counterclaim arising in part out of the same transactions and occurrences as the adjudicated claim. By applying the reasoning used in the Sears case, we reach a like conclusion here and uphold the jurisdiction of the Court of Appeals.
2
While the counterclaim arises in part out of the same transactions as does the adjudicated claim, it was filed long after the principal proceeding was begun, and is in the nature of an action ancillary to the principal proceeding and bears a separate case number. Upon request of both parties, the District Court has removed the counterclaim from the trial calendar, without prejudice to either party, leaving it subject to reinstatement for trial at any time by order of the court upon its own initiative, or upon request of either party after reasonable notice. A brief review of the entire proceedings and a disclosure of its subject matter throws light on the relationship between the adjudicated claim and the counterclaim.
3
In 1927, petitioner, The Cold Metal Process Company, an Ohio corporation, and United Engineering & Foundry Company, a Pennsylvania corporation, entered into a contract for the purpose of securing a patent in the name of Cold Metal relating to a certain type of steel rolling mill and of granting to United an exclusive license to make, use and sell mills under such patent. To that end, the parties contributed claims under their respective patent applications and it was agreed that the license should be granted when the patent was issued. The parties also agreed to try, by negotiation, to determine the amount of the payment by United for the license. If the parties could not agree on that point, the subject was to be submitted to arbitration in a manner specified in the contract.3
4
In 1930, the patent was issued but Cold Metal refused to treat the 1927 contract as conferring an exclusive license on United. Cold Metal maintained that United was not a licensee until the amount due Cold Metal had been determined and paid. United, on the other hand, treated the contract as an enforceable exclusive license under which the license fee was to be determined later.
5
After litigation not now material,4 Cold Metal, in 1934, instituted the present proceeding, Equity No. 2991, against United in the United States District Court for the Western District of Pennsylvania. Cold Metal seked (1) for an injunction restraining United from prosecuting certain suits, pending in Ohio and elsewhere, founded upon United's claim of exclusive rights under the patent, and (2) for determination of the amount to be paid by United under the 1927 contract. The court declined to issue a preliminary injunction, D.C., 9 F.Supp. 994, but Cold Metal appealed from such denial and, in 1935, obtained a reversal directing the injunction to be issued, 3 Cir., 79 F.2d 666.
6
In 1939, Cold Metal, in line with the foregoing results, filed a supplemental complaint asking that the 1927 contract be 'cancelled, revoked and annulled' and that United be enjoined from further operations under the patent. However, in 1938, the District Court, after trial, held the contract valid and enforceable, and directed an accounting before a master. 83 F.Supp. 914.
7
Cold Metal appealed but, in 1939, the Court of Appeals reversed its 1935 decision and largely sustained United's position. It ordered that the injunction against United's infringement suits be dissolved and held that the 1927 contract created a valid and enforceable exclusive license in favor of United. It also stated that the master could determine, from an 'understanding' between the parties as shown by the record, the amount due from United under the 1927 contract. 3 Cir., 107 F.2d 27.
8
In 1941, United asked leave to file an amended answer and counterclaim, complaining that Cold Metal's recent acts were inconsistent with the 1939 judgment of the Court of Appeals. In 1942, the District Court denied that motion on the ground that it could carry out only the existing mandate of the Court of Appeals. 43 F.Supp. 375. It suggested, however, that the injunction sought by United in its counterclaim should be the subject matter of another action, and that United could assert, before the master, Cold Metal's breaches of the 1927 contract. In 1943, the District Court modified its 1938 decree to make it conform to the Court of Appeals' order of 1939. It also appointed a master to determine not only the amount due Cold Metal from United for its past operations, but the payments to be made on licensed mills in the future.
9
In 1949, United refiled its claims as an 'Ancillary Cross Complaint' in Civil Action No. 7744. United sought, inter alia, (1) to enjoin the prosecution of infringement suits by Cold Metal against parties using mills under licenses granted by United, (2) to require Cold Metal to account for any funds it had collected for the use of such mills within the field of United's exclusive license, and (3) to set off those funds from any payment or royalty that might be due from United to Cold Metal under the 1927 contract. In 1950, the District Court dismissed the cross complaint on the ground that it was not ancillary to Equity No. 2991. 92 F.Supp. 596. However, in 1951, the Court of Appeals reversed the District Court. It held that United's cross complaint was, in reality, a counterclaim, ancillary to Equity No. 2991, and, therefore, within the jurisdiction of the District Court. 3 Cir., 190 F.2d 217. The Court of Appeals reviewed the previous course of the proceedings and pointed out that the claims now made by United in this counterclaim are entirely dependent upon the 1939 decision of that court, 107 F.2d 27, which upheld the validity of United's exclusive license.
10
Into this situation, in 1954, came the master's report on the accounting in Equity No. 2991. It listed the licensed mills, fixed the compensation payable under the 1927 contract, and found that United's license had existed from 1930 to 1947 and that United's customers were duly licensed to use the patented mills. It also held that certain United mills were exempt from royalty, that Cold Metal had failed to respect the license or to perform all of its obligations under the 1927 contract, but that United owed Cold Metal a substantial sum under it.
11
In 1955, the District Court approved the master's report in all respects and entered judgment against United for $387,650, with interest at 6% from the date of filing of the report. Both parties appealed. Cold Metal at once moved to dismiss United's appeal on the ground that the District Court had not made the certification required by Rule 54(b). With permission of the Court of Appeals, the District Court then amended its judgment to add such certification.5
12
Again both parties appealed. Again Cold Metal moved to dismiss United's appeal from the amended judgment because the Court of Appeals lacked jurisdiction to entertain it. This time the motion was denied with a per curiam opinion in which the Court of Appeals said 'We think the determination made under the circumstances of this case is the very kind of thing Rule 54(b) was written to provide for. We see no violation of discretion on the part of the district judge in entering it.' 3 Cir., 221 F.2d 115.
13
Accordingly, on October 3, 1955, in the Court of Appeals, the parties argued their respective appeals on their merits in Equity No. 2991. However, before any decision was rendered on the merits, we granted certiorari upon Cold Metal's petition questioning the jurisdiction of the Court of Appeals to entertain the appeal. 350 U.S. 819, 76 S.Ct. 48. We agree with the Court of Appeals that this is the very kind of case for which amended Rule 54(b) was designed. The appealability of the adjudicated claim is upheld so that the merits of the existing judgment may be determined at this stage of the proceedings.
14
Prior to the promulgation of the Federal Rules of Civil Procedure in 1939, it may well have been true that the Court of Appeals would not, at this stage, have had jurisdiction over United's appeal. Under the single judicial unit theory of finality which was then recognized, the Court of Appeals would have been without jurisdiction until United's counterclaim also had been decided by the District Court. That would have been so even if the counterclaim did not arise out of the same transaction and occurrence as Cold Metal's claim.6 However, as stated in Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 76 S.Ct. 895, Rule 54(b), in its original form, modified the judicial unit theory in respect to multiple claims actions. Accordingly, under that rule, it is likely that if United's counterclaim qualified as 'permissive,'7 rather than as 'compulsory,'8 the Court of Appeals would have had jurisdiction to entertain the appeal now before us.9 This conclusion follows from the fact that the test of appealability under the original rule was whether the adjudicated claims were separate from, and independent of, the unadjudicated claims. See Reeves v. Beardall, 316 U.S. 283, 62 S.Ct. 1085, 86 L.Ed. 1478.
15
However, as set forth in Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 76 S.Ct. 895, that test led to uncertainty, of which the present case might have been an example.10 The amended rule overcomes that difficulty and, under its terms, we need not decide whether United's counterclaim is compulsory or permissive. The amended rule, in contrast to the rule in its original form, treats counterclaims, whether compulsory or permissive, like other multiple claims. It provides that 'When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, the (district) court may direct the entry of a final judgment upon one or more but less than all of the claims * * *.' (Emphasis supplied.) Counterclaims and cross-claims are thus equated with the others. See Bendix Aviation Corp. v. Glass, 3 Cir., 195 F.2d 267, 38 A.L.R.2d 356. Therefore, under the amended rule, the relationship of the adjudicated claims to the unadjudicated claims is one of the factors which the District Court can consider in the exercise of its discretion. If the District Court certifies a final order on a claim which arises out of the same transaction and occurrence as pending claims, and the Court of Appeals is satisfied that there has been no abuse of discretion, the order is appealable.
16
The reasoning and the result in Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 76 S.Ct. 895, is dispositive of this case. The order appealed from finally adjudicates Cold Metal's claim for relief, and the Court of Appeals has held that the trial court did not abuse its discretion in certifying the absence of just reasons for delay. That this order is appealable at a time when it would not have been appealable prior to the Federal Rules of Civil Procedure, or under Rule 54(b) in its original form, does not mean that Rule 54(b), as amended, is invalid. It applies only to a final decision of one or more claims for relief. The amended rule meets the needs and problems of modern judicial administration by adjusting the unit for appeal to fit multiple claims actions, while retaining a right of judicial review over the discretion exercised by the District Court in determining when there is no just reason for delay. This does not impair the statutory concept of finality embraced in § 1291, and, as held in Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 76 S.Ct. 895, is within the rulemaking power of this Court.
17
Affirmed.
18
For opinion of Mr. Justice FRANKFURTER, whom Mr. Justice HARLAN joins, concurring in No. 34 and dissenting in No. 76., see ante, p. 439.
1
For text, see Sears, Roebuck & Co. v. Mackey, 351 U.S. 433 435, 76 S.Ct. 898, 899.
2
For text, see Sears, Roebuck & Co. v. Mackey, 351 U.S. 431, 76 S.Ct. 897.
3
The entire agreement appears in 3 Cir., 107 F.2d 27, 28 29, note 1.
4
See D.C., 3 F.Supp. 120; 3 Cir., 68 F.2d 564, certiorari denied, 291 U.S. 675, 54 S.Ct. 530, 78 L.Ed. 1064, all relating to Equity No. 2506.
5
The amendment included an express determination that there was 'no just reason for delay in entering an order and final judgment disposing of the issues raised by the Report of the Special Master . . ..' This was done after a hearing during which the District Court said 'I think, so far as this Court is concerned, without a decision by the Court of Appeals on that report (of the special master), that we would just be wanderin in an area where we couldn't see our way out if we tried any other issue until this case is decided.'
After the master's report was filed, and before objections to it had been filed, counsel for each side jointly informed the court that they desired to dispose of the master's report before trying the issues in the pending (counterclaim) Civil Action No. 7744, and that the final action on the master's report might even make in undesirable to try that action. The court, thereupon, continued, sine die, the pretrial conference it had scheduled in Civil Action No. 7744, and removed the case from the trial calendar, without prejudice to either party and subject to reinstatement. That is the present status of the 'counterclaim.'
6
See Ayres v. Carver, 17 How. 591, 15 L.Ed. 179; Bowker v. United States, 186 U.S. 135, 22 S.Ct. 802, 46 L.Ed. 1090; General Electric Co. v. Marvel Rare Metals Co., 287 U.S. 430, 53 S.Ct. 202, 77 L.Ed. 408; Toomey v. Toomey, 80 U.S.App.D.C. 77, 149 F.2d 19.
7
Fed.Rules Civ.Proc., 13(b), defines a 'permissive' counterclaim as follows: 'A pleading may state as a counterclaim any claim against an opposing party not arising out of the transaction or occurrence that is the subject matter of the opposing party's claim.'
8
Fed.Rules Civ.Proc., 13(a), defines a compulsory counterclaim as follows:
'A pleading shall state as a counterclaim any claim which at the time of serving the pleading the pleader has against any opposing party, if it arises out of the transaction or occurrence that is the subject matter of the opposing party's claim and does not require for its adjudication the presence of third parties of whom the court cannot acquire jurisdiction, except that such a claim need not be so stated if at the time the action was commenced the claim was the subject of another pending action.'
9
See Audi Vision, Inc., v. RCA Mfg. Co., 2 Cir., 136 F.2d 621, 147 A.L.R. 574; Toomey v. Toomey, supra.
10
See Sears, Roebuck & Co. v. Mackey, 351 U.S. 433—435, 76 S.Ct. 898, 899.
| 89
|
351 U.S. 427
76 S.Ct. 895
100 L.Ed. 1297
SEARS, ROEBUCK AND CO., a New York Corporation, Petitioner,v.Bruce A. MACKEY, Individually, and Time Saver Tools, Inc., an Illinois Corporation.
No. 34.
Argued Feb. 28, 1956.
Decided June 11, 1956.
Mr.Walter J. Rockler, Washington, D.C., for petitioner.
Mr. Edward I. Rothschild, Chicago, Ill., for respondent.
Mr. Justice BURTON delivered the opinion of the Court.
1
This action, presenting multiple claims for relief, was brought by Mackey and another in the United States District Court for the Northern District of Illinois, Eastern Division, in 1953. The court expressly directed that judgment be entered for the defendant, Sears, Roebuck & Co., on two, but less than all, of the claims presented. It also expressly determined that there was no just reason for delay in making the entry. After Mackey's notice of appeal from that judgment to the Court of Appeals for the Seventh Circuit, Sears, Roebuck & Co. moved to dismiss the appeal for lack of appellate jurisdiction. The Court of Appeals upheld its jurisdiction and denied the motion, relying upon 28 U.S.C. § 1291, 28 U.S.C.A. § 1291 and Rule 54(b) of the Federal Rules of Civil Procedure, as amended in 1946, 28 U.S.C.A. 218 F.2d 295. Because of the importance of the issue in determining appellate jurisdiction and because of a conflict of judicial views on the subject,1 we granted certiorari. 348 U.S. 970, 75 S.Ct. 535, 99 L.Ed. 755. For the reasons hereafter stated, we sustain the Court of Appeals and its appellate jurisdiction.
2
Although we are here concerned with the present appealability of the judgment of the District Court and not with its merits, we must examine the claims stated in the complaint so as to consider adequately the issue of appealability.
3
The complaint contains six counts. We disregard the fifth because it has been abandoned and the sixth because it duplicates others. The claims stated in Counts I and II are material and have been dismissed without leave to amend. The claim contained in Count III and that in amended Court IV are at issue on the answers filed by Sears, Roebuck & Co. The appeal before us is from a judgment striking out Counts I and II without disturbing Counts III and IV, and the question presented is whether such a judgment is presently appealable when the District Court, pursuant to amended Rule 54(b), has made 'an express determination that there is no just reason for delay' and has given 'an express direction for the entry of judgment.'
4
In Count I, Mackey, a citizen of Illinois, and Time Saver Tools, Inc., and Illinois corporation owned by Mackey, are the original plaintiffs and the respondents here. Sears, Roebuck & Co., a New York corporation doing business in Illinois, is the original defendant and the petitioner here. Mackey charges Sears with conduct violating the Sherman Antitrust Act in a manner prejudicial to three of Mackey's commercial ventures causing him $190,000 damages, for which he seeks $570,000 as treble damages. His first charge is unlawful destruction by Sears, since 1949, of the market for nursely lamps manufactured by General Metalcraft Company, a corporation wholly owned by Mackey. Mackey claims that this caused him a loss of $150,000. His second charge is unlawful interference by Sears, in 1952, with Mackey's contract to sell, on commission, certain tools and other products of the Vascoloy-Ramet Corporation, causing Mackey to lose $15,000. His third charge is unlawful destruction by Sears, in 1952, of the market for a new type of carbide-tipped lathe bit and for other articles manufactured by Time Saver Tools, Inc., resulting in a loss to Mackey of $25,000. Mackey combines such charges with allegations that Sears has used its great size to monopolize commerce and restrain competition in these fields. He asks for damages and equitable relief.
5
In Count II, Mackey claims federal jurisdiction by virtue of diversity of citizenship. He incorporates the allegations of Count I as to the Metalcraft transactions and asks for $250,000 damages for Sears' wilful destruction of the business of Metalcraft, plus $50,000 for Mackey's loss on obligations guaranteed by him.
6
In Count III, Mackey seeks $75,000 in a common-law proceeding against Sears for unlawfully inducing a breach of his Vascoloy commission contract.
7
In Count IV, Time Saver seeks $200,000 in a common-law proceeding against Sears for unlawfully destroying Time Saver's business by unfair competition and patent infringement.
8
The jurisdiction of the Court of Appeals to entertain Mackey's appeal from the District Court's judgment depends upon 28 U.S.C. § 1291, 28 U.S.C.A. § 1291, which provides that 'The courts of appeals shall have jurisdiction of appeals from all final decisions of the district courts of the United States * * *.' (Emphasis supplied.)
9
If Mackey's complaint had contained only Count I, there is no doubt that a judgment striking out that count and thus dismissing, in its entirety, the claim there stated would be both a final and an appealable decision within the meaning of § 1291. Similarly, if his complaint had contained Counts I, II, III and IV, there is no doubt that a judgment striking out all four would be a final and appealable decision under § 1291. The controversy before us arises solely because, in this multiple claims action, the District Court has dismissed the claims stated in Counts I and II, but has left unadjudicated those stated in Counts III and IV.2
10
Before the adoption of the Federal Rules of Civil Procedure in 1939, such a situation was generally regarded as leaving the appellate court without jurisdiction of an attempted appeal. It was thought that, although the judgment was a final decision on the respective claims in Counts I and II, it obviously was not a final decision of the whole case, and there was no authority for treating anything less than the whole case as a judicial unit for purposes of appeal.3 This construction of the judicial unit was developed from the common law which had dealt with litigation generally less complicated than much of that of today.4
11
With the Federal Rules of Civil Procedure, there came an increased opportunity for the liberal joinder of claims in multiple claims actions. This, in turn, demonstrated a need for relaxing the restrictions upon what should be treated as a judicial unit for purposes of appellate jurisdiction. Sound judicial administration did not require relaxation of the standard of finality in the disposition of the individual adjudicated claims for the purpose of their appealability. It did, however, demonstrate that, at least in multiple claims actions, some final decisions, on less than all of the claims, should be appealable without waiting for a final decision on all of the claims. Largely to meet this need, in 1939, Rule 54(b) was promulgated in its original form through joint action of Congress and this Court.5 It read as follows:
12
'(b) Judgment at Various Stages. When more than one claim for relief is presented in an action, the court at any stage, upon a determination of the issues material to a particular claim and all counterclaims arising out of the transaction or occurrence which is the subject matter of the claim, may enter a judgment disposing of such claim. The judgment shall terminate the action with respect to the claim so disposed of and the action shall proceed as to the remaining claims. In case a separate judgment is so entered, the court by order may stay its enforcement until the entering of a subsequent judgment or judgments and may prescribe such conditions as are necessary to secure the benefit thereof to the party in whose favor the judgment is entered.'
13
It gave limited relief. The courts interpreted it as not relaxing the requirement of a 'final decision' on each individual claim as the basis for an appeal, but as authorizing a limited relaxation of the former general practice that, in multiple claims actions, all the claims had to be finally decided before an appeal could be entertained from a final decision upon any of them.6 Thus, original Rule 54(d) modified the single judicial unit theory but left unimpaired the statutory concept of finality prescribed by § 1291. However, it was soon found to be inherently difficult to determine by any automatic standard of unity which of several multiple claims were sufficiently separable from others to qualify for this relaxation of the unitary principle in favor of their appealability. The result was that the jurisdictional time for taking an appeal from a final decision on less than all of the claims in a multiple claims action in some instances expired earlier than was foreseen by the losing party. It thus became prudent to take immediate appeals in all cases of doubtful appealability and the volume of appellate proceedings was undesirably increased.
14
Largely to overcome this difficulty, Rule 54(b) was amended, in 1946, to take effect in 1948.7 Since then it has read as follows:
15
'(b) Judgment Upon Multiple Claims. When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, the court may direct the entry of a final judgment upon one or more but less than all of the claims only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates less than all the claims shall not terminate the action as to any of the claims, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims.' (Emphasis supplied.)
16
In this form, it does not relax the finality required of each decision, as an individual claim, to render it appealable, but it does provide a practical means of permitting an appeal to be taken from one or more final decisions on individual claims, in multiple claims actions, without waiting for final decisions to be rendered on all the claims in the case. The amended rule does not apply to a single claim action nor to a multiple claims action in which all of the claims have been finally decided. It is limited expressly to multiple claims actions in which 'one or more but less than all' of the multiple claims have been finally decided and are found otherwise to be ready for appeal.
17
To meet the demonstrated need for flexibility, the District Court is used as a 'dispatcher.' It is permitted to determine, in the first instance, the appropriate time when each 'final decision' upon 'one or more but less than all' of the claims in a multiple claims action is ready for appeal. This arrangement already has lent welcome certainty to the appellate procedure. Its 'negative effect' has met with uniform approval. The effect so referred to is the rule's specific requirement that for 'one or more but less than all' multiple claims to become appealable, the District Court must make both 'an express determination that there is no just reason for delay' and 'an express direction for the entry of judgment.' A party adversely affected by a final decision thus knows that his time for appeal will not run against him until this certification has been made.8
18
In the instant case, the District Court made this certification, but Sears, Roebuck & Co. nevertheless moved to dismiss the appeal for lack of appellate jurisdiction under § 1291. The grounds for such a motion ordinarily might be (1) that the judgment of the District Court was not a decision upon a 'claim for relief', (2) that the decision was not a 'final decision' in the sense of an ultimate disposition of an individual claim entered in the course of a multiple claims action, or (3) that the District Court abused its discretion in certifying the order.
19
In the case before us, there is no doubt that each of the claims dismissed is a 'claim for relief' within the meaning of Rule 54(b), or that their dismissal constitutes a 'final decision' on individual claims. Also, it cannot well be argued that the claims stated in Counts I and II are so inherently inseparable from, or closely related to, those stated in Counts III and IV that the District Court has abused its discretion in certifying that there exists no just reason for delay. They certainly can be decided independently of each other.
20
Petitioner contends that amended Rule 54(b) attempts to make an unauthorized extension of § 1291. We disagree. It could readily be argued here that the claims stated in Counts I and II are sufficiently independent of those stated in Counts III and IV to satisfy the requirements of Rule 54(b) even in its original form. If that were so, the decision dismissing them would also be appealable under the amended rule. It is nowhere contended today that a decision that would have been appealable under the original rule is not also appealable under the amended rule, provided the District Court makes the required certification.
21
While it thus might be possible to hold that in this case the Court of Appeals had jurisdiction under original Rule 54(b), there at least would be room for argument on the issue of whether the decided claims were separate and independent from those still pending in the District Court.9 Thus the instant case affords an excellent illustration of the value of the amended rule which was designed to overcome that difficulty. Assuming that the requirements of the original rule are not met in this case, we nevertheless are enabled to recognize the present appellate jurisdiction of the Court of Appeals under the amended rule. The District Court cannot, in the exercise of its discretion, treat as 'final' that which is not 'final' within the meaning of § 1291. But the District Court may, by the exercise of its discretion in the interest of sound judicial administration, release for appeal final decisions upon one or more, but less than all, claims in multiple claims actions. The timing of such a release is, with good reason, vested by the rule primarily in the discretion of the District Court as the one most likely to be familiar with the case and with any justifiable reasons for delay. With equally good reason, any abuse of that discretion remains reviewable by the Court of Appeals.
22
Rule 54(b), in its original form, thus may be said to have modified the single judicial unit practice which had been developed by court decisions. The validity of that rule is no longer questioned. In fact, it was applied by this Court in Reeves v. Beardall, 316 U.S. 283, 62 S.Ct. 1085, 86 L.Ed. 1478, without its validity being questioned.
23
Rule 54(b), in its amended form, is a comparable exercise of the rulemaking authority of this Court. It does not supersede any statute controlling appellate jurisdiction. It scrupulously recognizes the statutory requirement of a 'final decision' under § 1291 as a basic requirement for an appeal to the Court of Appeals. It merely administers that requirement in a practical manner in multiple claims actions and does so by rule instead of by judicial decision. By its negative effect, it operates to restrict in a valid manner the number of appeals in multiple claims actions.
24
We reach a like conclusion as to the validity of the amended rule where the District Court acts affirmatively and thus assists in properly timing the release of final decisions in multiple claims actions. The amended rule adapts the single judicial unit theory so that it better meets the current needs of judicial administration. Just as Rule 54(b), in its original form, resulted in the release of some decisions on claims in multiple claims actions before they otherwise would have been released,10 so amended Rule 54(b) now makes possible the release of more of such decisions subject to judicial supervision. The amended rule preserves the historic federal policy against piecemeal appeals in many cases more effectively than did the original rule.11
25
Accordingly, the appellate jurisdiction of the Court of Appeals is sustained,12 and its judgment denying the motion to dismiss the appeal for lack of appellate jurisdiction is affirmed.
26
Affirmed.
27
Mr. Justice FRANKFURTER, whom Mr. Justice HARLAN joins, concurring in No. 34 and dissenting in No. 76.
28
The result in these two litigations of course has significance for the parties. That is, however, of relative insignificance compared to the directions which judges in the district courts and courts of appeals will draw from the Court's opinions. For me what is said has not a little kindship with the pronouncements of the Delphic oracle.
29
The opinion in Cold Metal declares that 28 U.S.C. § 1291, 28 U.S.C.A. § 1291, remains unimpaired but surely that section does not remain what it was before these opinions were written. Rule 54(b) is apparently the transforming cause. The Court could have said that Rule 54(b), promulgated under congressional authority and having the force of statute, has qualified 28 U.S.C. § 1291, 28 U.S.C.A. § 1291. It does not say so. The Court could have said that it rejects the reasoning of the decisions in which this Court for over a century has interpreted § 1291 as expressing a hostility toward piecemeal appeals. It does not say so. The Court could have said that Rule 54(b)'s requirement of a certificate from a district judge means that the district judges alone determine the content of finality. The Court does not say that either.
30
The Court does indicate that what has been the core of the doctrine of finality as applied to multiple claims litigation—that only that part of a litigation which is separate from, and independent of, the remainder of the litigation can be appealed before the completion of the entire litigation—is no longer to be applied as a standard, or at least as an exclusive standard, for deciding what is final for purposes of § 1291. The Court does not, however, indicate what standards the district courts and the courts of appeals are now to apply in determining when a decision is final. It leaves this problem in the first instance to the district courts, subject to review by the courts of appeals for an abuse of discretion. In other instances where a district court's ruling can be upset only for an abuse of its discretion, the scope of review is necessarily narrow. Here, in regard to the present problem, what is to come under review is a newly modified requirement of finality. But the requirement continues to be based upon a statute, viz., 28 U.S.C. § 1291, 28 U.S.C.A. § 1291, and that statute defines and constricts the jurisdiction of the courts of appeals. Therefore the issue of compliance with this congressional command would, I should suppose, cast upon the courts of appeals a duty of independent judgment broader than is implied by the usual flavor of the phrase 'abuse of discretion.'
31
For me, the propositions emerging from analysis of the relationship of Rule 54(b) to 28 U.S.C. § 1291, 28 U.S.C.A. § 1291 are clear.
32
1. 28 U.S.C. § 1291, 28 U.S.C.A. § 1291 is left intact by Rule 54(b). It could not be otherwise with due regard for the congressional policy embodied in that section and in view of what the Advisory Committee on the Rules said in its Note to amended Rule 54(b):
33
'The historic rule in the federal courts has always prohibited piecemeal disposal of litigation and permitted appeals only from final judgments except in those special instances covered by statute. * * * Rule 54(b) was originally adopted in view of the wide scope and possible content of the newly created 'civil action' in order to avoid the possible injustice of a delay in judgment of a distinctly separate claim to await adjudication of the entire case. It was not designed to overturn the settled federal rule stated above. * * *
34
'After extended consideration, it (the Committee) concluded that a retention of the older federal rule was desirable, and that this rule needed only the exercise of a discretionary power to afford a remedy in the infrequent harsh case to provide a simple, definite, workable rule. This is afforded by amended Rule 54(b). It re-establishes an ancient policy with clarity and precision. * * *'
35
Report of Advisory Committee on Proposed Amendments to Rules of Civil Procedure 70—72.
36
2. 28 U.S.C. § 1291, 28 U.S.C.A. § 1291 is not a technical rule in a game. It expresses not only a deeply rooted but a wisely sanctioned principle against piecemeal appeals governing litigation in the federal courts. See Cobbledick v. United States, 309 U.S. 323, 60 S.Ct. 540, 84 L.Ed. 783; Radio Station WOW v. Johnson, 326 U.S. 120, 123—127, 65 S.Ct. 1475, 1477—1480, 89 L.Ed. 2092. The great importance of this characteristic feature of the federal judicial system—its importance in administering justice—is made luminously manifest by considering the evils where, as in New York piecemeal reviews are allowed.
37
3. While the principle against piecemeal appeals has been compendiously and therefore, at times, loosely phrased as implying that the whole of a litigation, no matter what its nature, must be completed before any appeal is allowed, see Collins v. Miller, 252 U.S. 364, 370, 40 S.Ct. 347, 349, 64 L.Ed. 616, the underlying rationale of the principle has been respected when not susceptible of this mechanical way of putting it. What have been called exceptions are not exceptions at all in the sense of inroads on the principle. They have not qualified the core, that is, that there should be no premature, intermediate appeal.
38
Thus the Court has permitted appeal before completion of the whole litigation when failure to do so would preclude any effective review or would result in irreparable injury. See Forgay v. Conrad, 6 How. 201, 12 L.Ed. 404; Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 545—547, 69 S.Ct. 1221, 1225 1226, 93 L.Ed. 1528; Swift & Co. Packers v. Compania Columbiana Del Caribe, 339 U.S. 684, 688—689, 70 S.Ct. 861, 864—865, 94 L.Ed. 1206. A second situation in which the Court has found that an appeal before termination of the entire litigation did not conflict with the congressional policy against piecemeal appeals is that in which a party to the completed portion of the litigation has no interest in the rest of the proceedings and to make him await their outcome would merely cause unfairness. See Williams v. Morgan, 111 U.S. 684, 699, 4 S.Ct. 638, 646, 28 L.Ed. 559; United States v. River Rouge Imp. Co., 269 U.S. 411, 413—414, 46 S.Ct. 144, 145, 70 L.Ed. 339.
39
4. The expansion by the Federal Rules of the allowable content of a proceeding and the range of a litigation inevitably enlarged the occasions for severing one aspect or portion of a litigation from what remains under the traditional test of a 'final decision.' On the basis of prior cases, we held that it was not a departure from the policy against piecemeal appeals to permit an appeal with respect to that part of a multiple claims litigation based on a set of facts separate and independent from the facts on which the remainder of the litigation was based. Reeves v. Beardall, 316 U.S. 283, 62 S.Ct. 1085, 86 L.Ed. 1478. The Note of the Advisory Committee, quoted supra, demonstrates that the amended Rule 54(b) was designed in accordance with the historic policy against premature appeal and with the decisions of this Court allowing appeal from a 'judgment of a distinctly separate claim.' What the Rule did introduce, however, was a discretionary power in the district judge to control appealability by preventing a party from even attempting to appeal a severable part of a litigation unless the district judge has expressly certified that there is no just reason for delay and has expressly directed entry of judgment on that phase of the litigation. This provision was directed to the kind of difficulty encountered in Dickinson v. Petroleum Conversion Corp., 338 U.S. 507, 70 S.Ct. 322, 94 L.Ed. 299, in ascertaining whether the district judge is in fact finished with a separable part of the litigation.
40
The Court casually disregards this long history of § 1291 and the bearing of Rule 54(b) to it by rejecting the separate-and-independent test as the basis for determining the finality of a part of a multiple claims litigation. The Court says that its decision 'does not impair the statutory concept of finality embraced in § 1291.' The Court may not do so in words, for it pays lip-service to § 1291. But that section's function as a brake against piecemeal appeals in future multiple claims litigation is greatly impaired. Encouragement is abundantly given to parties to seek such appeals.
41
The principles which this Court has heretofore enunciated over a long course of decisions under § 1291 furnish ready guides for deciding the appealability of the certified parts of the litigation in the two cases now before the Court. Count II in Sears, Roebuck and Co. v. Mackey, is appealable since the transactions and occurrences involved in it do not involve any of those embraced in Counts III and IV. Count I involves at least two transactions which are also the subject matter of Counts III and IV but is appealable under § 1292(1) as an interlocutory order denying an injunction. In Cold Metal Process Co. v. United Engineering & Foundry Co., 351 U.S. 445, 76 S.Ct. 904, the counterclaim, even if not compulsory, is based in substantial part on the transactions involved in the main litigation and hence not appealable.
42
5. Of course, as the Court's opinion appears to recognize, that crucial principle of the doctrine of finality that the court of appeals has no jurisdiction unless there is a 'final decision' cannot be left to the district court. It is one thing for a district court to determine whether it is or is not through with a portion of a litigation. It is quite another thing for it to determine whether the requirements of § 1291 are satisfied so as to give jurisdiction to the court of appeals. A district court can no more confer jurisdiction on a court of appeals outside the limits of 28 U.S.C. § 1291, 28 U.S.C.A. § 1291, than a state supreme court can confer jurisdiction on this Court beyond the bounds of 28 U.S.C. § 1257, 28 U.S.C.A. § 1257. In a particular litigation the opinion of the district judge may properly be deemed a valuable guide. But flexibility would be a strange name for authority in the district court to command the court of appeals to exercise jurisdiction.
43
6. In summary, then, the Court rightly states, even if it does not hold, that § 1291 is unimpaired by Rule 54(b). Section 1291 is what a long course of decision has construed it to be. The unifying principle of decisions for over a century is observance of hostility in the federal judicial system to piecemeal appellate review (with a few strictly defined exceptions not here relevant, see 28 U.S.C. § 1292, 28 U.S.C.A. § 1292) of one litigation, no matter how many phases or parts there may be to a single judicial proceeding, so long as no part has become separated from, and independent of, the others. This rooted principle against piecemeal appeals of an organic whole—the core of § 1291—is not left unimpaired when its enforcement is committed without guidance to the individualized notions about finality of some two hundred and fifty district judges, themselves accountable to the discordant views of eleven essentially independent courts of appeals. Allowing such leeway to the district courts and courts of appeals is not flexibility but anarchy.
1
For decisions directly or impliedly sustaining the validity of amended Rule 54(b), as applied in the instant case, see Rieser v. Baltimore & O.R. Co., 2 Cir., 224 F.2d 198, and cases cited at page 203, note 7; United Artists Corp. v. Masterpiece Productions, Inc., 2 Cir., 221 F.2d 213; Town of Clarksville, Va. v. United States, 4 Cir., 198 F.2d 238; Boston Medical Supply Co. v. Lea & Febiger, 1 Cir., 195 F.2d 853; Bendix Aviation Corp. v. Glass, 3 Cir., 195 F.2d 267, 38 A.L.R.2d 356; Lopinsky v. Hertz Drive-Ur-Self Systems, Inc., 2 Cir., 194 F.2d 422, concurring opinion of Judge Clark, at pages 424—430; Pabellon v. Grace Line, Inc., 2 Cir., 191 F.2d 169. See 6 Moore's Federal Practice (2d ed. 1953) 220—230, and Note, 62 Yale L.J. 263.
Contra: See Rieser v. Baltimore & O.R. Co., supra, concurring opinion of Judge Frank, 224 F.2d at pages 205—208; Bendix Aviation Corp. v. Glass, supra, concurring opinion of Judge Hastie, 195 F.2d at pages 277—282; Pabellon v. Grace Line, Inc., supra, concuring opinion of Judge Frank, 191 F.2d at apges 176—181; Flegenheimer v. General Mills, Inc., 2 Cir., 191 F.2d 237. See also, Gold Seal Co. v. Weeks, 93 U.S.App.D.C. 249, 209 F.2d 802.
2
Sears also contends that the Court of Appeals misconstrued amended Rule 54(b). See Flegenheimer v. General Mills, Inc., supra. The meaning of that rule is considered hereafter.
3
At common law, a writ of error did not lie to review a judgment that failed to adjudicate every cause of action asserted in the controversy. See Holcombe v. McKusick, 20 How. 552, 15 L.Ed. 1020; United States v. Girault, 11 How. 22, 13 L.Ed. 587; Metcalfe's Case, 11 Co.Rep. 38a, 77 Eng.Rep. 1193. The rule generally followed in the federal courts was that, in a case involving a single plaintiff and a single defendant, a judgment was not appealable if it disposed of some, but less than all, of the claims presented. See Collins v. Miller, 252 U.S. 364, 40 S.Ct. 347, 64 L.Ed. 616; Sheppy v. Stevens, 2 Cir., 200 F. 946. In cases involving multiple parties where the alleged liability was joint, a judgment was not appealable unless it terminated the action as to all the defendants. See Hohorst v. Hamburg-American Packet Co., 148 U.S. 262, 13 S.Ct. 590, 37 L.Ed. 443. But if, in a multiple party case, a judgment finally disposed of a claim that was recognized to be separate and distinct from the others, that judgment, under some circumstances, was appealable. See Republic of China v. American Express Co., 2 Cir., 190 F.2d 334.
4
The appellate jurisdiction of the United States Courts of Appeals, with exceptions not directly pertinent here, is still largely restricted to the review of cases appealed under 28 U.S.C. § 1291, 28 U.S.C.A. § 1291. But see Forgay v. Conrad, 6 How. 201, 12 L.Ed. 404; Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 69 S.Ct. 1221, 93 L.Ed. 1528; 28 U.S.C. §§ 1292, 1651, 28 U.S.C.A. §§ 1292, 1651.
5
The Supreme Court's authority to promulgate the Federal Rules of Civil Procedure is derived from the Enabling Act, now appearing as 28 U.S.C. § 2072, 28 U.S.C.A. § 2072. It authorizes this Court to promulgate rules governing 'the forms of process, writs, pleadings, and motions, and the practice and procedure of the district courts of the United States * * * in civil actions.' It provides that such rules 'shall not abridge, enlarge or modify any substantive right * * *.' And, by reason of Article I, § 8, of the Constitution, it has been held repeatedly that only Congress may define the jurisdiction of the lower federal courts. See Silbach v. Wilson & Co., 312 U.S. 1, 655, 61 S.Ct. 422, 85 L.Ed. 479; Baltimore Contractors, Inc., v. Bodinger, 348 U.S. 176, 75 S.Ct. 249, 99 L.Ed. 233; and Fed.Rules Civ.Proc., rule 82. 'Such rules shall not take effect until they have been reported to Congress by the Chief Justice at or after the beginning of a regular session thereof but not later than the first day of May, and until the expiration of ninety days after the have been thus reported.' 28 U.S.C. § 2072, 28 U.S.C.A. § 2072.
6
See Pabellon v. Grace Line, Inc., supra, 191 F.2d at page 174.
7
'* * * situations arose where district courts made a piecemeal disposition of an action and entered what the parties thought amounted to a judgment, although a trial remained to be had on other claims similar or identical with those disposed of. In the interim the parties did not know their ultimate rights, and accordingly took an appeal, thus putting the finality of the partial judgment in question.' Report of Advisory Committee on Proposed Amendments to Rules of Civil Procedure 70—71 (June 1946).
8
For favorable comment on this aspect of the rule, see Dickinson v. Petroleum Conversion Corp., 338 U.S. 507, 511—512, 70 S.Ct. 322, 94 L.Ed. 299.
9
In the instant case, the claim dismissed by striking out Count I is based on the Sherman Act, 15 U.S.C.A. §§ 1—7, 15 note, while Counts III and IV do not rely on, or even refer to, that Act. They are largely predicated on common-law rights. The basis of liability in Count I is independent of that on which the claims in Counts III and IV depend. But the claim in Count I does rest in part on some of the facts that are involved in Counts III and IV. The claim stated in Count II is clearly independent of those in Counts III and IV.
10
See Collins v. Metro-Goldwyn Pictures Corp., 2 Cir., 106 F.2d 83, cited in Reeves v. Beardall, 316 U.S. 283, 62 S.Ct. 1085, 86 L.Ed. 1478.
11
See Cobbledick v. United States, 309 U.S. 323, 60 S.Ct. 540, 84 L.Ed. 783.
12
Mackey also argues that the Court of Appeals has jurisdiction under 28 U.S.C. § 1292(1), 29 U.S.C.A. § 1292(1). In view of our disposition of this case, we do not reach that contention.
| 89
|
351 U.S. 536
76 S.Ct. 861
100 L.Ed. 1396
Kendrick M. COLE, Petitioner,v.Philip YOUNG et al.
No. 442.
Argued March 6, 1956.
Decided June 11, 1956.
[Syllabus from pages 536-537 intentionally omitted]
Mr.David I. Shapiro, New York City, for petitioner.
Mr. Donald B. MacGuineas, Washington, D.C., for respondents.
Opinion of the Court by Mr. Justice HARLAN, announced by Mr. Justice BURTON.
1
This case presents the question of the meaning of the term 'national security' as used in the Act of August 26, 1950, giving to the heads of certain departments and agencies of the Government summary suspension and unreviewable dismissal powers over their civilian employees, when deemed necessary 'in the interest of the national security of the United States.'1
2
Petitioner, a preference-eligible veteran under § 2 of the Veterans' Preference Act of 1944, 58 Stat. 387, as amended, 5 U.S.C. § 851, 5 U.S.C.A. § 851, held a position in the classified civil service as a food and drug inspector for the New York District of the Food and Drug Administration, Department of Health, Education, and Welfare. In November 1953, he was suspended without pay from his position pending investigation to determine whether his employment should be terminated. He was given a written statement of charges alleging that he had 'a close association with individuals reliably reported to be Communists' and that he had maintained a 'sympathetic association' with, had contributed funds and services to, and had attended social gatherings of an allegedly subversive organization.
3
Although afforded an opportunity to do so, petitioner declined to answer the charges or to request a hearing, as he had the right to do. Thereafter, the Secretary of the Department of Health, Education, and Welfare, after 'a study of all the documents in (petitioner's) case,' determined that petitioner's continued employment was not 'clearly consistent with the interests of national security' and ordered the termination of his employment. Petitioner appealed his discharge to the Civil Service Commission, which declined to accept the appeal on the ground that the Veterans' Preference Act, under which petitioner claimed the right of appeal, was inapplicable to such discharges.
4
Petitioner thereafter brought an action in the District Court for the District of Columbia seeking a declaratory judgment that his discharge was invalid and that the Civil Service Commission had improperly refused to entertain his appeal, and an order requiring his reinstatement in his former position. The District Court granted the respondents' motion for judgment on the pleadings and dismissed the complaint. 125 F.Supp. 284. The Court of Appeals, with one judge dissenting, affirmed. 96 U.S.App.D.C. 379, 226 F.2d 337. Because of the importance of the questions involved in the field of Government employment, we granted certiorari. 350 U.S. 900, 76 S.Ct. 181.
5
Section 14 of the Veterans' Preference Act, 58 Stat. 390, as amended, 5 U.S.C. § 863, 5 U.S.C.A. § 863, provides that preference eligibles may be discharged only 'for such cause as will promote the efficiency of the service' and, among other procedural rights, 'shall have the right to appeal to the Civil Service Commission', whose decision is made binding on the employing agency. Respondents concede that petitioner's discharge was invalid if that Act is controlling. They contend, however, as was held by the courts below, that petitioner's discharge was authorized by the Act of August 26, 1950, supra, which eliminates the right of appeal to the Civil Service Commission. Thus the sole question for decision is whether petitioner's discharge was authorized by the 1950 Act.
6
The 1950 Act provides in material part that, notwithstanding any other personnel laws, the head of any agency to which the Act applies
7
'may, in his absolute discretion and when deemed necessary in the interest of national security, suspend, without pay, any civilian officer or employee of (his agency) * * *. The agency head concerned may, following such investigation and review as he deems necessary, terminate the employment of such suspended civilian officer or employee whenever he shall determine such termination necessary or advisable in the interest of the national security of the United States, and such determination by the agency head concerned shall be conclusive and final: * * *.'
8
The Act was expressly made applicable only to the Departments of State, Commerce, Justice, Defense, Army, Navy, and Air Force, the Coast Guard, the Atomic Energy Commission, the National Security Resources Board, and the National Advisory Committee for Aeronautics. Section 3 of the Act provides, however, that the Act may be extended 'to such other departments and agencies of the Government as the President may, from time to time, deem necessary in the best interests of national security', and the President has extended the Act under this authority 'to all other departments and agencies of the Government.'2 While the validity of this extension of the Act depends upon questions which are in many respects common to those determining the validity of the Secretary's exercise of the authority thereby extended to her,3 we will restrict our consideration to the latter issue and assume, for purposes of this decision, that the Act has validly been extended to apply to the Department of Health, Education, and Welfare.
9
The Act authorizes dismissals only upon a determination by the Secretary that the dismissal is 'necessary or advisable in the interest of the national security.' That determination requires an evaluation of the risk of injury to the 'national security' that the employee's retention would create, which in turn would seem necessarily to be a function, not only of the character of the employee and the likelihood of his misconducting himself, but also of the nature of the position he occupies and its relationship to the 'national security.' That is, it must be determined whether the position is one in which the employee's misconduct would affect the 'national security.' That, of course, would not be necessary if 'national security' were used in the Act in a sense so broad as to be involved in all activities of the Government, for then the relationship to the 'national security' would follow from the very fact of employment. For the reasons set forth below, however, we conclude (1) that the term 'national security' is used in the Act in a definite and limited sense and relates only to those activities which are directly concerned with the Nation's safety, as distinguished from the general welfare; and (2) that no determination has been made that petitioner's position was affected with the 'national security,' as that term is used in the Act. It follows that his dismissal was not authorized by the 1950 Act and hence violated the Veterans' Preference Act.
I.
10
In interpreting the 1950 Act, it is important to note that that Act is not the only, nor even the primary, source of authority to dismiss Government employees. The general personnel laws—the Lloyd-LaFollette4 and Veterans' Preference Acts—5 authorize dismissals for 'such cause as will promote the efficiency of the service', and the ground which we conclude was the basis for petitioner's discharge here—a reasonable doubt as to his loyalty—was recognized as a 'cause' for dismissal under those procedures as early as 1942.6 Indeed, the President's so-called Loyalty Program, Exec.Order No. 9835, 12 Fed.Reg.1935, 5 U.S.C.A. § 631 note, which prescribed an absolute standard of loyalty to be met by all employees regardless of position, had been established pursuant to that general authority three years prior to the 1950 Act and remained in effect for nearly three years after its passage.7 Thus there was no want of substantive authority to dismiss employees on loyalty grounds, and the question for decision here is not whether an employee can be dismissed on such grounds but only the extent to which the summary procedures authorized by the 1950 Act are available in such a case.
11
As noted above, the issue turns on the meaning of 'national security,' as used in the Act. While that term is not defined in the Act, we think it clear from the statute as a whole that that term was intended to comprehend only those activities of the Government that are directly concerned with the protection of the Nation from internal subversion or foreign aggression, and not those which contribute to the strength of the Nation only through their impact on the general welfare.
12
Virtually conclusive of this narrow meaning of 'national security' is the fact that, had Congress intended the term in a sense broad enough to include all activities of the Government, it would have granted the power to terminate employment 'in the interest of the national security' to all agencies of the Government. Instead, Congress specified 11 named agencies to which the Act should apply, the character of which reveals, without doubt, a purpose to single out those agencies which are directly concerned with the national defense and which have custody over information the compromise of which might endanger the country's security, the so-called 'sensitive' agencies. Thus, of the 11 named agencies, 8 are concerned with military operations or weapons development, and the other 3, with international relations, internal security, and the stock-piling of strategic materials. Nor is this conclusion vitiated by the grant of authority to the President, in § 3 of the Act, to extend the Act to such other agencies as he 'may, from time to time, deem necessary in the best interests of national security.' Rather, the character of the named agencies indicates the character of the determination required to be made to effect such an extension. Aware of the difficulties of attempting an exclusive enumeration and of the undesirability of a rigid classification in the face of changing circumstances, Congress simply enumerated those agencies which it determined to be affected with the 'national security' and authorized the President, by making a similar determination, to add any other agencies which were, or became, 'sensitive.' That it was contemplated that this power would be exercised 'from time to time' confirms the purpose to allow for changing circumstances and to require a selective judgment, necessarily implying that the standard to be applied is a less than all-inclusive one.
13
The limitation of the Act to the enumerated agencies is particularly significant in the light of the fact that Exec.Order No. 9835, establishing the Loyalty Program, was in full effect at the time of the consideration and passage of the Act. In that Order, the President had expressed his view that it was of 'vital importance' that all employees of the Government be of 'complete and unswerving loyalty' and had prescribed a minimum loyalty standard to be applied to all employees under the normal civil service procedures. Had Congress considered the objective of insuring the 'unswerving loyalty' of all employees, regardless of position, as a matter of 'national security' to be effectuated by the summary procedures authorized by the Act, rather than simply a desirable personnel policy to be implemented under the normal civil service procedures, it surely would not have limited the Act to selected agencies. Presumably, therefore, Congress meant something more by the 'interest of the national security' than the general interest the Nation has in the loyalty of even 'nonsensitive' employees.
14
We can find no justification for rejecting this implication of the limited purpose of the Act or for inferring the unlimited power contended for by the Government. Where applicable, the Act authorizes the agency head summarily to suspend an employee pending investigation and, after charges and a hearing, finally to terminate his employment, such termination not being subject to appeal. There is an obvious justification for the summary suspension power where the employee occupies a 'sensitive' position in which he could cause serious damage to the national security during the delay incident to an investigation and the preparation of charges. Likewise, there is a reasonable basis for the view that an agency head who must bear the responsibility for the protection of classified information committed to his custody should have the final say in deciding whether to repose his trust in an employee who has access to such information. On the other hand, it is difficult to justify summary suspensions and unreviewable dismissals on loyalty grounds of employees who are not in 'sensitive' positions and who are thus not situated where they could bring about any discernible adverse effects on the Nation's security. In the absence of an immediate threat of harm to the 'national security,' the normal dismissal procedures seem fully adequate and the justification for summary powers disappears. Indeed, in view of the stigma attached to persons dismissed on loyalty grounds, the need for procedural safeguards seems even greater than in other cases, and we will not lightly assume that Congress intended to take away those safeguards in the absence of some overriding necessity, such as exists in the case of employees handling defense secrets.
15
The 1950 Act itself reflects Congress' concern for the procedural rights of employees and its desire to limit the unreviewable dismissal power to the minimum scope necessary to the purpose of protecting activities affected with the 'national security.' A proviso to § 1 of the Act provides that a dismissal by one agency under the power granted by the Act 'shall not affect the right of such officer or employee to seek or accept employment in any other department or agency of the Government,' if the Civil Service Commission determines that the employee is eligible for such other employment. That is, the unreviewable dismissal power was to be used only for the limited purpose of removing the employee from the position in which his presence had been determined to endanger the 'national security'; it could affect his right to employment in other agencies only if the Civil Service Commission, after review, refused to clear him for such employment. This effort to preserve the employee's procedural rights to the maximum extent possible hardly seems consistent with an intent to define the scope of the dismissal power in terms of the indefinite and virtually unlimited meaning for which the respondents contend.
16
Moreover, if Congress intended the term to have such a broad meaning that all positions in the Government could be said to be affected with the 'national security,' the result would be that the 1950 Act, though in form but an exception to the general personnel laws, could be utilized effectively to supersede those laws. For why could it not be said that national security in that sense requires not merely loyal and trustworthy employees but also those that are industrious and efficient? The relationship of the job to the national security being the same, its demonstrated inadequate performance because of inefficiency or incompetence would seem to present a surer threat to national security, in the sense of the general welfare, than a mere doubt as to the employee's loyalty.
17
Finally, the conclusion we draw from the face of the Act that 'national security' was used in a limited and definite sense is amply supported by the legislative history of the Act.
18
In the first place, it was constantly emphasized that the bill, first introduced as S. 1561 in the 80th Congress and passed as H.R. 7439 in the 81st Congress, was intended to be applied, or be extended, only to 'sensitive' agencies, a term used to imply a close and immediate concern with the defense of the Nation.8 Thus the Senate Committee on Armed Services, in reporting out S.1561, stated:
19
'This bill provides authority to terminate employment of indiscreet or disloyal employees who are employed in areas of the Government which are sensitive from the standpoint of national security.
20
'(Section 3 will permit) the President to determine additional sensitive areas and include such areas in the scope of the authorities contained in this bill.
21
'Insofar as the (addition of § 3) is concerned, it was recognized by all witnesses that there were other sensitive areas within the various departments of the Government which are now, or might in the future become, deeply involved in national security. * * * In view * * * of the fact that there are now and will be in the future other sensitive areas of equal importance to the national security, it is believed that the President should have authority to make a finding concerning such areas and by Executive action place those areas under the authorities contained in this act.'9
22
The House Committee on Post Office and Civil Service reported that 'The provisions of the bill extend only to departments and agencies which are concerned with vital matters affecting the national security of our Nation.'10 The committee reports on H.R. 7439 in the next Congress similarly referred to the bill as granting the dismissal power only to the heads of the 'sensitive' agencies.11 While these references relate primarily to the agencies to be covered by the Act, rather than to the exercise of the power within an agency, the standard for both is the same—in the 'interests of the national security'—and the statements thus clearly indicate the restricted sense in which 'national security' was used. In short, 'national security' is affected only by 'sensitive' activities.
23
Secondly, the history makes clear that the Act was intended to authorize the suspension and dismissal only of persons in sensitive positions. Throughout the hearings, committee reports, and debates, the bill was described as being designed to provide for the dismissal of 'security risks.'12 In turn, the examples given of what might be a 'security risk' always entailed employees having access to classified materials; they were security risks because of the risk they posed of intentional or inadvertent disclosure of confidential information.13 Mr. Larkin, a representative of the Department of Defense, which Department had requested and drafted the bill, made this consideration more explicit:
24
'They are security risks because of their access to confidential and classified material. * * * But if they do not have classified material, why, there is no notion that they are security risks to the United States. They are security risks to the extent of having access to classified material.'14
25
'A person is accused of being disloyal, but is cleared by the loyalty board, because there is not enough evidence against him. If that person is not in a sensitive job, it is not of any further concern to us. We are willing to take the view, that while we might have misgivings about his loyalty, he cannot prejudice our security because he does not have access to any of the classified or top secret material.'15
26
It is clear, therefore, both from the face of the Act and the legislative history, that 'national security' was not used in the Act in an all-inclusive sense, but was intended to refer only to the protection of 'sensitive' activities. It follows that an employee can be dismissed 'in the interest of the national security' under the Act only if he occupies a 'sensitive' position, and thus that a condition precedent to the exercise of the dismissal authority is a determination by the agency head that the position occupied is one affected with the 'national security.' We now turn to an examination of the Secretary's action to show that no such determination was made as to the position occupied by petitioner.
II.
27
The Secretary's action in dismissing the petitioner was expressly taken pursuant to Exec. Order No. 10450, 18 Fed.Reg. 2489,16 promulgated in April 1953 to provide uniform standards and procedures for the exercise by agency heads of the suspension and dismissal powers under the 1950 Act. That Order prescribes as the standard for dismissal, and the dismissal notice given to petitioner contained, a determination by the Secretary that the employee's retention in employment 'is not clearly consistent with the interests of national security.'17 Despite this verbal formula however, it is our view that the Executive Order does not in fact require the agency head to make any determination whatever on the relationship of the employee's retention to the 'national security' if the charges against him are within the categories of the charges against petitioner—that is, charges which reflect on the employee's loyalty. Rather, as we read the Order, it enjoins upon the agency heads the duty of discharging any employee of doubtful loyalty, irrespective of the character of his job and its relationship to the 'national security.' That is, the Executive Order deems an adverse determination as to loyalty to satisfy the requirements of the statute without more.
28
The opening preamble to the Order recites, among other things, that 'the interests of the national security require' that 'all' Government employees be persons 'of complete and unswerving loyalty.' It would seem to follow that an employee's retention cannot be 'clearly consistent' with the 'interests of the national security' as thus defined unless he is 'clearly' loyal—that is unless there is no doubt as to his loyalty. And § 8(a) indicates that that is in fact what was intended by the Order. That section provides that the investigation of an employee pursuant to the Order shall be designed to develop information 'as to whether * * * (his employment) is clearly consistent with the interests of the national security', and prescribes certain categories of facts to which 'such' information shall relate. The first category, § 8(a)(1), includes nonloyalty-oriented facts which, in general, might reflect upon the employee's reliability, trustworthiness, or susceptibility to coercion, such as dishonesty, drunkenness, sexual perversion, mental defects, or other reasons to believe that he is subject to influence or coercion. Section 8(a)(1) expressly provides, however, that such facts are relevant only 'depending on the relation of the Government employment to the national security.' The remaining categories include facts which, in general, reflect upon the employee's 'loyalty,' such as acts of espionage, advocacy of violent overthrow of the Government, sympathetic association with persons who so advocate, or sympathetic association with subversive organizations. § 8(a)(2)—(8). Significantly, there is wholly absent from these categories—under which the charges against petitioner were expressly framed—any qualification making their relevance dependent upon the relationship of the employee's position to the national security. The inference we draw is that in such cases the relationship to the national security is irrelevant, and that an adverse 'loyalty' determination is sufficient ex proprio vigore to require discharge.
29
Arguably, this inference can be avoided on the ground that § 8(a) relates only to the scope of information to be developed in the investigation and not to the evaluation of it by the agency head. That is, while loyalty information is to be developed in all cases regardless of the nature of the employment, that does not mean that the agency head should not consider the nature of the employment in determining whether the derogatory information is sufficient to make the employee's continued employment not 'clearly consistent' with the 'national security.' No doubt that is true to the extent that the greater the sensitivity of the position the smaller may be the doubts that would justify termination; the Order undoubtedly leaves it open to an agency head to apply a stricter standard in some cases than in others, depending on the nature of the employment. On the other hand, by making loyalty information relevant in all cases, regardless of the nature of the job, § 8(a) seems strongly to imply that there is a minimum standard of loyalty that must be met by all employees. It would follow that the agency head may terminate employment in cases where that minimum standard is not met without making any independent determination of the potential impact of the person's employment on the national security.
30
Other provisions of the Order confirm the inferences that may be drawn from § 8(a). Thus § 3(b) directs each agency head to designate as 'sensitive' those positions in this agency 'the occupant of which could bring about, by virtue of the nature of the position, a material adverse effect on the national security.' By definition, therefore, some employees are admittedly not in a position to bring about such an effect. Nevertheless, the Order makes this distinction relevant only for purposes of determining the scope of the investigation to the conducted, not for purposes of limiting the dismissal power to such 'sensitive' positions. Section 3(a) is more explicit. That provides that the appointment of all employees shall be made subject to an investigation the scope of which shall depend upon the degree of adverse effect on the national security the occupant of the position could bring about, but which 'in no event' is to be less than a prescribed minimum. But the sole purpose of such an investigation is to provide a basis for a 'clearly consistent' determination. Thus the requirement of a minimum investigation of all persons appointed implies that an adverse 'clearly consistent' determination may be made as to any such employee, regardless of the potential adverse effect he could cause to the national security. Finally, the second 'Whereas' clause of the preamble recites as a justification for the Order that 'all persons * * * privileged to be employed * * * (by the Government should) be adjudged by mutually consistent and no less than minimum standards', thus implying that the Order prescribes minimum standards that all employees must meet irrespective of the character of the positions held, one of which is the 'complete and unswerving loyalty' standard recited in the first 'Whereas' clause of the preamble.
31
Confirmation of this reading of the Order is found in its history. Exec. Order No. 9835, supra, as amended by Exec.Order No. 10241, 16 Fed.Reg. 3690, had established the Loyalty Program under which all employees, regardless of their positions, were made subject to discharge if there was a 'reasonable doubt' as to their loyalty. That Order was expressly revoked by § 12 of the present Executive Order. There is no indication, however, that it was intended thereby to limit the scope of the persons subject to a loyalty standard. And any such implication is negatived by the remarkable similarity in the preambles to the two Orders and in the kinds of information considered to be relevant to the ultimate determinations.18 In short, all employees, were still to be subject to at least a minimum loyalty standard, though under new procedures which do not afford a right to appeal to the Civil Service Commission.
32
We therefore interpret the Executive Order as meaning that, when 'loyalty' charges are involved, an employee may be dismissed regardless of the character of his position in the Government service, and that the agency head need make no evaluation as to the effect which continuance of his employment might have upon the 'national security.' We recognize that this interpretation of the Order rests upon a chain of inferences drawn from less than explicit provisions. But the Order was promulgated to guide the agency heads in the exercise of the dismissal power, and its failure to state explicitly what determinations are required leaves no choice to the agency heads but to follow the most reasonable inferences to be drawn. Moreover, whatever the practical reasons that may have dictated the awkward form of the Order, its failure to state explicitly what was meant is the fault of the Government. Any ambiguities should therefore be resolved against the Government, and we will not burden the employee with the assumption that an agency head, in stating no more than the formal conclusion that retention of the employee is not 'clearly consistent with the interests of national security', has made any subsidiary determinations not clearly required by the Executive Order.
33
From the Secretary's determination that petitioner's employment was not 'clearly consistent with the interests of national security', therefore, it may be assumed only that the Secretary found the charges to be true and that they created a reasonable doubt as to petitioner's loyalty. No other subsidiary finding may be inferred, however, for, under the Executive Order as we have interpreted it no other finding was required to support the Secretary's action.19
34
From our holdings (1) that not all positions in the Government are affected with the 'national security' as that term is used in the 1950 Act, and (2) that no determination has been made that petitioner's position was one in which he could adversely affect the 'national security,' it necessarily follows that petitioner's discharge was not authorized by the 1950 Act. In reaching this conclusion, we are not confronted with the problem of reviewing the Secretary's exercise of discretion, since the basis for our decision is simply that the standard prescribed by the Executive Order and applied by the Secretary is not in conformity with the Act.20 Since petitioner's discharge was not authorized by the 1950 Act and hence violated the Veterans' Preference Act, the judgment of the Court of Appeals is reversed and the case is remanded to the District Court for further proceedings not inconsistent with this opinion.
35
Reversed and remanded.
Appendix to Opinion of the Court.
36
'Executive Order 10450.
37
(18 Fed.Reg. 2489, as amended by Exec. Order No. 10491, Oct. 13, 1953, 18 Fed.Reg. 6583.)
38
'Whereas the interests of the national security require that all persons privileged to be employed in the departments and agencies of the Government shall be reliable, trustworthy, of good conduct and character, and of complete and unswerving loyalty to the United States; and
39
'Whereas the American tradition that all persons should receive fair, impartial, and equitable treatment at the hands of the Government requires that all persons seeking the privilege of employment or privileged to be employed in the departments and agencies of the Government be adjudged by mutually consistent and no less than minimum standards and procedures among the departments and agencies governing the employment and retention in employment of persons in the Federal service:
40
'Now, Therefore, by virtue of the authority vested in me by the Constitution and statutes of the United States, including section 1753 of the Revised Statutes of the United States (5 U.S.C. 631); the Civil Service Act of 1883 (22 Stat. 403; 5 U.S.C. 632, et seq.); section 9A of the act of August 2, 1939, 53 Stat. 1148 (5 U.S.C. 118j); and the act of August 26, 1950, 64 Stat. 476 (5 U.S.C. 22—1, et seq.), and as President of the United States, and deeming such action necessary in the best interests of the national security, it is hereby ordered as follows:
41
'Sec. 1. In addition to the departments and agencies specified in the said act of August 26, 1950, and Executive Order No. 10237 of April 26, 1951, the provisions of that act shall apply to all other departments and agencies of the Government.
42
'Sec. 2. The head of each department and agency of the Government shall be responsible for establishing and maintaining within his department or agency an effective program to insure that the employment and retention in employment of any civilian officer or employee within the department or agency is clearly consistent with the interests of the national security.
43
'Sec. 3. (a) The appointment of each civilian officer or employee in any department or agency of the Government shall be made subject to investigation. The scope of the investigation shall be determined in the first instance according to the degree of adverse effect the occupant of the position sought to be filled could bring about, by virtue of the nature of the position, on the national security, but in no event shall the investigation include less than a national agency check (including a check of the fingerprint files of the Federal Bureau of Investigation), and written inquiries to appropriate local law-enforcement agencies, former employers and supervisors, references, and schools attended by the person under investigation: Provided, that upon request of the head of the department or agency concerned, the Civil Service Commission may, in its discretion, authorize such less investigation as may meet the requirements of the national security with respect to per-diem, intermittent, temporary, or seasonal employees, or aliens employed outside the United States. Should there develop at any stage of investigation information indicating that the employment of any such person may not be clearly consistent with the interests of the national security, there shall be conducted with respect to such person a full field investigation, or such less investigation as shall be sufficient to enable the head of the department or agency concerned to determine whether retention of such person is clearly consistent with the interests of the national security.
44
'(b) The head of any department or agency shall designate, or cause to be designated, any position within his department or agency the occupant of which could bring about, by virtue of the nature of the position, a material adverse effect on the national security as a sensitive position. Any position so designated shall be filled or occupied only by a person with respect to whom a full field investigation has been conducted: Provided, that a person occupying a sensitive position at the time it is designated as such may continue to occupy such position pending the completion of a full field investigation, subject to the other provisions of this order: And provided further, that in case of emergency a sensitive position may be filled for a limited period by a person with respect to whom a full field preappointment investigation has not been completed if the head of the department or agency concerned finds that such action is necessary in the national interest, which finding shall be made a part of the records of such department or agency.
45
'Sec. 4. The head of each department and agency shall review, or cause to be reviewed, the cases of all civilian officers and employees with respect to whom there has been conducted a full field investigation under Executive Order No. 9835 of March 21, 1947, and, after such further investigation as may be appropriate, shall re-adjudicate, or cause to be re-adjudicated, in accordance with the said act of August 26, 1950, such of those cases as have not been adjudicated under a security standard commensurate with that established under this order.
46
'Sec. 5. Whenever there is developed or received by any department or agency information indicating that the retention in employment of any officer or employee of the Government may not be clearly consistent with the interests of the national security, such information shall be forwarded to the head of the employing department or agency or his representative, who, after such investigation as may be appropriate, shall review, or cause to be reviewed, and, where necessary, re-adjudicate, or cause to be re-adjudicated, in accordance with the said act of August 26, 1950, the case of such officer or employee.
47
'Sec. 6. Should there develop at any stage of investigation information indicating that the employment of any officer or employee of the Government may not be clearly consistent with the interests of the national security, the head of the department or agency concerned or his representative shall immediately suspend the employment of the person involved if he deems such suspension necessary in the interests of the national security and, following such investigation and review as he deems necessary, the head of the department or agency concerned shall terminate the employment of such suspended officer or employee whenever he shall determine such termination necessary or advisable in the interests of the national security, in accordance with the said act of August 26, 1950.
48
'Sec. 7. Any person whose employment is suspended or terminated under the authority granted to heads of departments and agencies by or in accordance with the said act of August 26, 1950, or pursuant to the said Executive Order No. 9835 or any other security or loyalty program relating to officers or employees of the Government, shall not be reinstated or restored to duty or reemployed in the same department or agency and shall not be reemployed in any other department or agency, unless the head of the department or agency concerned finds that such reinstatement, restoration, or reemployment is clearly consistent with the interests of the national security, which finding shall be made a part of the records of such department or agency: Provided, that no person whose employment has been terminated under such authority thereafter may be employed by any other department or agency except after a determination by the Civil Service Commission that such person is eligible for such employment.
49
'Sec. 8. (a) The investigations conducted pursuant to this order shall be designed to develop information as to whether the employment or retention in employment in the Federal service of the person being investigated is clearly consistent with the interests of the national security. Such information shall relate, but shall not be limited, to the following:
50
'(1) Depending on the relation of the Government employment to the national security:
51
'(i) Any behavior, activities, or associations which tend to show that the individual is not reliable or trustworthy.
52
'(ii) Any deliberate misrepresentations, falsifications, or omissions of material facts.
53
'(iii) Any criminal, infamous, dishonest, immoral, or notoriously disgraceful conduct, habitual use of intoxicants to excess, drug addiction, or sexual perversion.
54
'(iv) An adjudication of insanity, or treatment for serious mental or neurological disorder without satisfactory evidence of cure.*'
55
'(v) Any facts which furnish reason to believe that the individual may be subjected to coercion, influence, or pressure which may cause him to act contrary to the best interests of the national security.
56
'(2) Commission of any act of sabotage, espionage, treason, or sedition, or attempts thereat or preparation therefor, or conspiring with, or aiding or abetting, another to commit or attempt to commit any act of sabotage, espionage, treason, or sedition.
57
'(3) Establishing or continuing a sympathetic association with a saboteur, spy, traitor, seditionist, anarchist, or revolutionist, or with an espionage or other secret agent or representative of a foreign nation, or any representative of a foreign nation whose interests may be inimical to the interests of the United States, or with any person who advocates the use of force or violence to overthrow the government of the United States or the alternation of the form of government of the United States by unconstitutional means.
58
'(4) Advocacy of use of force or violence to overthrow the government of the United States, or of the alteration of the form of government of the United States by unconstitutional means.
59
'(5) Membership in, or affiliation or sympathetic association with, any foreign or domestic organization, association, movement, group, or combination of persons which is totalitarian, Fascist, Communist, or subversive, or which has adopted, or shows, a policy of advocating or approving the commission of acts of force or violence to deny other persons their rights under the Constitution of the United States, or whch seeks to alter the form of government of the United States by unconstitutional means.
60
'(6) Intentional, unauthorized disdisclosure to any person of security information, or of other information disclosure of which is prohibited by law, or willful violation or disregard of security regulations.
61
'(7) Performing or attempting to perform his duties, or otherwise acting, so as to serve the interests of another government in preference to the interests of the United States.
62
'(8) Refusal by the individual, upon the ground of constitutional privilege against self-incrimination, to testify before a congressional committee regarding charges of his alleged disloyalty or other misconduct.
63
'Sec. 10. Nothing in this order shall be construed as eliminating or modifying in any way the requirement for any investigation or any determination as to security which may be required by law.
64
'Sec. 11. On and after the effective date of this order the Loyalty Review Board established by Executive Order No. 9835 of March 21, 1947, shall not accept agency findings for review, upon appeal or otherwise. * * *
65
'Sec. 12. Executive Order No. 9835 of March 21, 1947, as amended, is hereby revoked. For the purposes described in section 11 hereof the Loyalty Review Board and the regional loyalty boards of the Civil Service Commission shall continue to exist and function for a period of one hundred and twenty days from the effective date of this order, and the Department of Justice shall continue to furnish the information described in paragraph 3 of Part III of the said Executive Order No. 9835, but directly to the head of each department and agency.
66
'Sec. 15. This order shall become effective thirty days after the date hereof.
67
'Dwight D. Eisenhower.
68
'The White House,
69
'April 27, 1953.'
70
Mr. Justice CLARK, with whom Mr. Justice REED and Mr. Justice MINTON join, dissenting.
71
Believing that the Court should not strike down the President's Executive Order on employee security by an interpretation that admittedly 'rests upon a chain of inferences,' we cannot agree to the judgment of reversal. In our opinion, the clear purpose of the Congress in enacting the Summary Suspension Act, 64 Stat. 476, is frustrated, and the Court's opinion raises a serious question of presidential power under Article II of the Constitution which it leaves entirely undecided.
72
Petitioner, a food and drug inspector employed in the Department of Health, Education and Welfare, was charged with having 'established and * * * continued a close association with individuals reliably reported to be Communists.' It was further charged that he had 'maintained a continued and sympathetic association with the Nature Friends of America, which organization' is on the Attorney General's list; and 'by (his) own admission, donated funds' to that group, contributed services to it and attended social gatherings of the same. Petitioner did not answer the charges but replied that they constituted an invasion of his private rights of association. Although advised that he could have a hearing, he requested none, and was thereafter dismissed. The Secretary made a formal determination that petitioner's continued employment was not 'clearly consistent with the interests of the national security,' a determination entrusted to her by the Suspension Act. Although 'such determination by the agency head concerned shall be conclusive and final' under the Act, the Court, by its interpretation, finds 'that not all positions in the Government are affected with the 'national security' as that term is used * * * (and) that no determination has been made that petitioner's position was one in which he could adversely affect the 'national security." It, therefore, strikes down the President's Executive Order because 'the standard prescribed by (it) and applied by the Secretary is not in conformity with the Act.' This compels the restoration of the petitioner to Government service. We cannot agree.
73
We have read the Act over and over again, but find no ground on which to infer such an interpretation. It flies directly in the face of the language of the Act and the legislative history. The plain words of § 1 make the Act applicable to 'any civilian officer or employee', not, as the majority would have it, 'any civilian officer or employee in a sensitive position.' The Court would require not only a finding that a particular person is subversive, but also that he occupies a sensitive job. Obviously this might leave the Government honeycombed with subversive employees.
74
Although the Court assumes the validity of the President's action under § 3 extending the coverage of the Act to all Government agencies, the reasoning of the opinion makes that extension a fortiori unauthorized. The limitation the Court imposes deprives the extension of any force, despite the fact that § 3 has no limiting words whatever. And this is done in the face of legislative history showing that Congress clearly contemplated that the coverage might be extended without limitation 'to such other departments and agencies of the Government' that the President thought advisable. Senator Byrd commented 'Section 3 gives the President the right to classify every agency as a sensitive agency * * *. He could take the whole Government.' And Senator Chapman remarked, 'I do not see why the whole Government is not sensitive as far as that is concerned.' Hearings before the Senate Committee on Armed Services, 81st Cong., 2d Sess., on H.R. 7439, pp. 15—16. Also, Congressman Holifield, during debates in the House, stated that the Act 'applies potentially to every executive agency, not only the sensitive ones. * * * There is no distinction made in the bill between so-called sensitive employees, that is, employees who have access to confidential and secret information, and the regular employees.' 96 Cong.Rec. 10023—10024.
75
The President believed that the national security required the extension of the coverage of the Act to all employees. That was his judgment, not ours. He was given that power, not us. By this action the Court so interprets the Act as to intrude itself into presidential policy making. The Court should not do this, especially here where Congress has ratified the President's action. As required by the Act the Executive Order was reported to the Congress and soon thereafter it came up for discussion and action in both the House and the Senate. It was the sense of the Congress at that time that the Order properly carried out the standards of the Act and was in all respects an expression of the congressional will. 99 Cong.Rec. 4511—4543, 5818—5990. In addition, Congress has made appropriations each subsequent year for investigations, etc., under its provisions. This in itself 'stands as confirmation and ratification of the action of the Chief Executive.' Fleming v. Mohawk Wrecking & Lumber Co., 331 U.S. 111, 116, 67 S.Ct. 1129, 1132, 91 L.Ed. 1375.
76
The President having expended the coverage of the Act to the Department of Health, Education, and Welfare, it became the duty of the Secretary to dismiss any employee whenever she deemed it 'necessary or advisable in the interests of national security.' She made such a finding. It is implicit in her order of dismissal. Her 'evaluation as to the effect which continuance of (petitioner's) employment might have upon the 'national security" has been made. She decided that he should be dismissed. Under the Act this determination is 'conclusive and final.'
77
There is still another reason why we should sustain the President's Executive Order. By striking it down, the Court raises a question as to the constitutional power of the President to authorize dismissal of executive employees whose further employment he believes to be inconsistent with national security. This power might arise from the grant of executive power in Article II of the Constitution, and not from the Congress. The opinion of the majority avoids this important point which must be faced by any decision holding an Executive Order inoperative.* It is the policy of the Court to avoid constitutional questions where possible, Peters v. Hobby, 349 U.S. 331, 338, 75 S.Ct. 790, 793, 99 L.Ed. 1129, not to create them.
78
We believe the Court's order has stricken down the most effective weapon against subversive activity available to the Government. It is not realistic to say that the Government can be protected merely by applying the Act to sensitive jobs. One never knows just which job is sensitive. The janitor might prove to be in as important a spot securitywise as the top employee in the building. The Congress decided that the most effective way to protect the Government was through the procedures laid down in the Act. The President implemented its purposes by requiring that Government employment be 'clearly consistent' with the national security. The President's standard is 'complete and unswerving loyalty' not only in sensitive places but throughout the Government. The President requires, and every employee should give, no less. This is all that the Act and the Order require. They should not be subverted by the technical interpretation the majority places on them today. We would affirm.
1
§ 1. 'Notwithstanding the provisions of section 6 of the Act of August 24, 1912 (37 Stat. 555), as amended (5 U.S.C. 652), or the provisions of any other law, the Secretary of State; Secretary of Commerce; Attorney General; the Secretary of Defense; the Secretary of the Army; the Secretary of the Navy; the Secretary of the Air Force; the Secretary of the Treasury; Atomic Energy Commission; the Chairman, National Security Resources Board; or the Director, National Advisory Committee for Aeronautics, may, in his absolute discretion and when deemed necessary in the interest of national security, suspend, without pay, any civilian officer or employee of the Department of State (including the Foreign Service of the United States), Department of Commerce, Department of Justice, Department of Defense, Department of the Army, Department of the Navy, Department of the Air Force, Coast Guard, Atomic Energy Commission, National Security Resources Board, or National Advisory Committee for Aeronautics, respectively, or of their several field services: Provided, That to the extent that such agency head determines that the interests of the national security permit, the employee concerned shall be notified of the reasons for his suspension and within thirty days after such notification any such person shall have an opportunity to submit any statements or affidavits to the official designated by the head of the agency concerned to show why he should be reinstated or restored to duty. The agency head concerned may, following such investigation and review as he deems necessary, terminate the employment of such suspended civilian officer or employee whenever he shall determine such termination necessary or advisable in the interest of the national security of the United States, and such determination by the agency head concerned shall be conclusive and final: Provided further, That any employee having a permanent or indefinite appointment, and having completed his probationary or trial period, who is a citizen
of the United States whose employment is suspended under the authority of this Act, shall be given after his suspension and before his employment is terminated under the authority of this Act, (1) a written statement within thirty days after his suspension of the charges against him, which shall be subject to amendment within thirty days thereafter and which shall be stated as specifically as security considerations permit; (2) an opportunity within thirty days thereafter (plus an additional thirty days if the charges are amended) to answer such charges and to submit affidavits; (3) a hearing, at the employee's request, by a duly constituted agency authority for this purpose; (4) a review of his case by the agency head, or some official designated by him, before a decision adverse to the employee is made final; and (5) a written statement of the decision of the agency head: Provided further, That any person whose employment is so suspended or terminated under the authority of this Act may, in the discretion of the agency head concerned, be reinstated or restored to duty, and if so reinstated or restored shall be allowed compensation for all or any part of the period of such suspension or termination in an amount not to exceed the difference between the amount such person would normally have earned during the period of such suspension or termination, at the rate he was receiving on the date of suspension or termination, as appropriate, and the interim net earnings of such person: Provided further, That the termination of employment herein provided shall not affect the right of such officer or employee to seek or accept employment in any other department or agency of the Government: Provided further, That the head of any department or agency considering the appointment of any person whose employment has been terminated under the provisions of this Act may make such appointment only after consultation with the Civil Service Commission, which agency shall have the authority at the written request of either the head of such agency or such employee to determine whether any such person is eligible for employment by any other agency or department of the Government.
'Sec. 3. The provisions of this Act shall apply to such other departments and agencies of the Government as the President may,
from time to time, deem necessary in the best interests of national security. If any departments or agencies are included by the President, he shall so report to the Committees on the Armed Services of the Congress.' 64 Stat. 476, 5 U.S.C. §§ 22—1, 22—3, 5 U.S.C.A. §§ 22—1, 22—3.
2
§ 1, Exec. Order No. 10450, 18 Fed.Reg. 2489, 5 U.S.C.A. § 631 note, set forth in the Appendix, 76 S.Ct. 874.
3
Secretary Folsom, the present Secretary of the Department of Health, Education, and Welfare, has been substituted as respondent for the former Secretary Hobby.
4
§ 6, 37 Stat. 555, as amended, 5 U.S.C. § 652, 5 U.S.C.A. § 652.
5
§ 14, 58 Stat. 390, as amended, 5 U.S.C. § 863, 5 U.S.C.A. § 863.
6
Civil Service War Regulations, § 18.2(c)(7), September 26, 1942, 5 CFR, Cum.Supp., § 18.2(c)(7).
7
Employees dismissed under the Loyalty Program were entitled to review by the Civil Service Commission's Loyalty Review Board, thus satisfying the requirements of § 14 of the Veterans' Preference Act. See Kutcher v. Gray, 91 U.S.App.D.C. 266, 199 F.2d 783.
8
Congress' reluctance to extend such powers to all agencies of the Government is also indicated by the prior legislation. At various times since 1942, similar summary dismissal statutes, of limited duration, had been enacted, but these had been limited to the obviously 'sensitive' military departments, 56 Stat. 1053, 63 Stat. 987, 1023, and the State Department, 60 Stat. 458. The 1950 Act, introduced at the request of the Department of Defense, was designed to make the authority permanent, include several other 'sensitive' agencies, and afford greater flexibility by permitting the President to extend the Act to other agencies which became 'sensitive.' H.R.Rep. No. 2330, 81st Cong., 2d Sess., p. 3; S.Rep. No. 1155, 80th Cong., 2d Sess., p. 4.
9
S.Rep. No. 1155, 80th Cong., 2d Sess., pp. 2—4.
10
H.R.Rep. No. 2264, 80th Cong., 2d Sess., p. 2.
11
H.R.Rep. No. 2330, 81st Cong., 2d Sess., pp. 2—5; S.Rep. No. 2158, 81st Cong., 2d Sess., p. 2.
12
E.g., S.Rep. No. 2158, 81st Cong., 2d Sess., p. 2: 'The purpose of the bill is to increase the authority of the heads of Government departments engaged in sensitive activities to summarily suspend employees considered to be had security risks * * *.'
13
For example, Mr. Murray, the Chairman of the Committee on Post Office and Civil Service, which had reported the bill, gave the following illustration of the purpose of the bill in opening the debate in the House: 'For instance, an employee who is working in some highly sensitive agency doing very confidential, secret defense work and who goes out and gets too much liquor may unintentionally or unwittingly, because of his condition, confide to someone who may be a subversive, secret military information about the character of work he is doing in that department. He is, by his conduct, a bad security risk and should be discharged.' 96 Cong.Rec. 10017.
14
Hearings, House Committee on Post Office and Civil Service, on H.R. 7439, 81st Cong., 2d Sess., p. 67.
15
Id., at p. 72.
16
The relevant portions of the Executive Order, as it stood at the time of petitioner's suspension and discharge, are printed in the Appendix, 76 S.Ct. 874.
17
Section 6 of the Order, which formally prescribes the standards for 'termination,' in terms adopts the very language of the statute, 'necessary or advisable in the interests of the national security.' Section 7, however, provides that a suspended employee 'shall not be reinstated' unless the agency head determines that reinstatement is 'clearly consistent with the interests of the national security.' Since nonreinstatement of a suspended employee is equivalent to the termination of his employment, it is apparent that the 'clearly consistent' standard of § 7 is the controlling one. See also §§ 2, 8, and 3(a). In the view we take of the case, we need not determine whether the 'clearly consistent' standard is, as petitioner contends, a more onerous one than the 'necessary or advisable' standard.
18
Executive Order No. 9835 recited that it was 'of vital importance' that all employees be of 'complete and unswerving loyalty'; Exec. Order No. 10450 recites that 'the interests of the national security require' that all employees be of 'complete and unswerving loyalty.' Executive Order No. 9835 listed six factors to be considered 'in connection with the determination of disloyalty', Pt. V, subd. 2; these are repeated in substantially identical form in §§ 8(a)(2), (4), (5), (6), and (7) of Exec. Order No. 10450 as 'information as to whether * * * (the employee's retention) is clearly consistent with the interests of the national security.'
19
That the Secretary similarly interpreted the Executive Order and did not in fact determine that petitioner's job was a 'sensitive' one is confirmed by the respondents' concession that petitioner 'did not have access to Government secrets or classified material and was not in a position to influence policy against the interests of the Government.' Respondents' Brief, pp. 3—4; Record, p. 40.
20
No contention is made that the Executive Order might be sustained under the President's executive power even though in violation of the Veterans' Preference Act. There is no basis for such an argument in any event, for it is clear from the face of the Executive Order that the President did not intend to override statutory limitations on the dismissal of employees, and promulgated the Order solely as an implementation of the 1950 Act. Thus § 6 of the Order purports to authorize dismissals only 'in accordance with the said act of August 26, 1950', and similar references are made in §§ 4, 5, and 7. This explicit limitation in the substantive provisions of the Order is of course not weakened by the inclusion of the 'Constitution,' as well as the 1950 and other Acts, in the omnibus list of authorities recited in the Preamble to the Order; it is from the Constitution that the President derives any authority to implement the 1950 Act at all. When the President expressly confines his action to the limits of statutory authority, the validity of the action must be determined solely by the congressional limitations which the President sought to respect, whatever might be the result were the President ever to assert his independent power against that of Congress.
*
After the date of petitioner's discharge, this paragraph was amended, by Exec. Order No. 10548, Aug. 2, 1954, 19 Fed.Reg. 4871, to read:
'(iv) Any illness, including any mental condition, of a nature which in the opinion of competent medical authority may cause significant defect in the judgment or reliability of the employee, with due regard to the transient or continuing effect of the illness and the medical findings in such case.'
*
The majority excuses its failure to pass on this question by saying that no contention was made that the President's Order might be sustained under his executive powers. We cannot agree. The Government specifically asserted that 'if Congress had meant to prohibit the President from acting in this respect under (the Act) a serious question as to the validity of that enactment would arise.' It devoted eight pages of its brief to this point. Furthermore, the Court of Appeals (96 U.S.App.D.C. 379, 382, 226 F.2d 337, 340) noted that if it 'thought the President's Order inconsistent with the act of the Congress, (it) would have to decide the constitutional question thus presented.' As further justification, the majority contends that the President acted here only under the directions of the Act. In answer, we need quote only the enacting clause of the President's Order: 'Now, Therefore, by virtue of the authority vested in me by the Constitution and statutes of the United States * * * and as President of the United States.' Executive Order No. 10450, 18 Fed.Reg. 2489. In issuing the Order, the President invoked all of his powers, and since his Order is voided by the majority as not being in conformity with the Act, the question of the scope of his other constitutional or statutory powers is presented.
| 23
|
351 U.S. 502
76 S.Ct. 958
100 L.Ed. 1366
Martha C. REED, Petitioner,v.PENNSYLVANIA RAILROAD COMPANY.
No. 621.
Argued May 1, 1956.
Decided June 11, 1956.
Mr.
Joseph S. Lord, III, Philadelphia, Pa., for petitioner.
Mr. Theodore Voorhees, Philadelphia, Pa., for respondent.
Mr. Justice MINTON delivered the opinion of the Court.
1
The question we have for decision here is whether petitioner, a clerical employee of respondent railroad, is within the coverage of the Federal Employers' Liability Act, § 1, 35 Stat. 65, as amended, 53 Stat. 1404, 45 U.S.C. § 51, 45 U.S.C.A. § 51. Petitioner is employed entirely in respondent's office building in Philadelphia. Her duties consist of filing original tracings of all of respondent's engines, cars, parts, tracks, bridges, and other structures, from which blueprints of those items are made. There are some 325,000 tracings on file in the office in which petitioner works. Whenever an order for blueprints comes in from anywhere in respondent's system, it is petitioner's responsibility to fill the order by securing the correct tracings from the files. These she takes to the blueprint maker in the same office building. After the blueprints are made, it is petitioner's further duty to return the original tracings to the appropriate file. About 67% of the blueprints so made are sent to points outside Pennsylvania. The files which petitioner attends are the sole depository of the original tracings of the structural details of all of respondent's rolling stock, trackage, and other equipment and installations, and as such represent a fund of documents without which maintenance of the operating system would be impossible.
2
Petitioner was injured when a cracked window pane in her office blew in upon her. She brought suit for personal injury under the Federal Employers' Liability Act. On respondent's motion to dismiss, the District Court held that petitioner was not within the coverage of § 1 of the Act and, there being no diversity of citizenship between the parties, dismissed the complaint for lack of jurisdiction. The Court of Appeals affirmed. 3 Cir., 227 F.2d 810. We granted certiorari because of the importance of the question presented in the administration of the Act. 350 U.S. 965, 76 S.Ct. 439.
3
As originally enacted, § 1 provided that every railroad, 'while engaging' in interstate commerce,
4
'shall be liable in damages to any person suffering injury while he is employed by such carrier in such commerce * * * for such injury or death resulting in whole or in part from the negligence of any of the officers, agents, or employees of such carrier, or by reason of any defect or insufficiency, due to its negligence, in its cars, engines, appliances, machinery, track, roadbed, works, boats, wharves, or other equipment.' 35 Stat. 65.
5
A further paragraph was added to the section in 1939, and it is clear that two specific problems which the amendment sought at least to remedy were the results of this Court's holdings that, at the moment of his injury, the employee as well as the railroad had to be engaged in interstate commerce in order to come within the coverage of § 1, and that employees engaged in construction of new facilities were not covered. S.Rep.No. 661, 76th Cong., 1st Sess. 2—3; Southern Pacific Co. v. Gileo, 351 U.S. 493, 76 S.Ct. 952. The amendment took the form of an expanded definition of 'person * * * employed' in interstate commerce. The amendment reads:
6
'Any employee of a carrier, any part of whose duties as such employee shall be the furtherance of interstate or foreign commerce; or shall, in any way directly or closely and substantially, affect such commerce as above set forth shall, for the purposes of this Act, be considered as being employed by such carrier in such commerce and shall be considered as entitled to the benefits of this Act * * *.' 53 Stat. 1404.
7
No argument is made that Congress could not constitutionally include petitioner within the coverage of the Act. The argument is that the amendment was narrowly drawn to remedy specific evils and that to construe it to include petitioner would amount to inclusion in the Act of virtually all railroad employees—a result which respondent assumes is unintended and undesirable. The argument takes several forms. First, it is said that 'commerce' in the Act means only transportation and that petitioner is not employed in transportation. See Shanks v. Delaware, L. & W. R. Co., 239 U.S. 556, 559—560, 36 S.Ct. 188, 190, 60 L.Ed. 436. But the interstate commerce in which respondent is engaged is interstate transportation. If 'any part' of petitioner's duties is in 'furtherance' of or substantially affects interstate commerce, it also is in 'furtherance' of or substantially affects interstate transportation. The test for coverage under the amendment is not whether the employee is engaged in transportation, but rather whether what he does in any way furthers or substantially affects transportation. Nor can we resolve the issue presented here in terms of whether or not clerical employees as a class are excluded from the benefits of the statute. The 1939 amendment was designed to obliterate fine distinctions as to coverage between employees who, for the purpose of this remedial legislation, should be treated alike. There is no meaningful distinction, in terms of whether the employee's duties are clerical or not, between petitioner and, for illustration, an assistant chief timekeeper, Straub v. Reading Co., 3 Cir., 220 F.2d 177, or a messenger boy carrying waybills and grain orders between separate local offices and freight stations, Bowers v. Wabash R. Co., Mo.App., 246 S.W.2d 535, or a lumber inspector hurt while inspecting ties at a lumber company, Ericksen v. Southern Pacific Co., 39 Cal.2d 374, 246 P.2d 642—all of whom have been held covered by the 1939 amendment. See also Lillie v. Thompson, 332 U.S. 459, 68 S.Ct. 140, 92 L.Ed. 73. Nor are the benefits of the Act limited to those exposed to the special hazards of the railroad industry. The Act has not been so interpreted, and the 1939 amendment specifically affords protection to 'any employee' whose duties bring him within that amendment. There is no basis in the language of § 1 for confining liability of the railroad so as to exclude any class of railroad employees as a class. The benefits of the Act are not limited to those who have cinders in their hair, soot on their faces, or callouses on their hands. Section 1 cannot be interpreted to exclude petitioner from its benefits without further consideration of the function she performs and its impact on interstate commerce.
8
We think that the present petitioner is employed by the respondent in interstate commerce within the meaning of the 1939 amendment to § 1. Although the amendment may have been prompted by a specific desire to obviate certain court-made rules limiting coverage, the language used goes far beyond that narrow objective. It evinces a purpose to expand coverage substantially as well as to avoid narrow distinctions in deciding questions of coverage. Under the amendment, it is the 'duties' of the employee that must further or affect commerce, and it is enough if 'any part' of those duties has the requisite effect. The statute commands us to examine the purpose and effect of the employee's function in the railroad's interstate operation, without limitation to nonclerical employees or determination on the basis of the employee's importance as an individual in the railroad's organization.
9
Here respondent railroad has chosen to arrange its operations so that repairs and construction anywhere within its system which require blueprints must go through its Philadelphia office. No such work can be done without recourse to the files of 325,000 original tracings in petitioner's custody. Loss or misplacing of those tracings could promptly cause delay, confusion, or worse in the day-to-day operation of respondent's lines. If all employees who perform petitioner's duties were removed from service, respondent could not conduct its operations without a change in its organizational system. To recognize this is to attribute to petitioner neither an exaggerated nor an attenuated relationship to respondent's transportation system. The filing of tracings and the dispatch of blueprints taken from them comprise a direct link in the maintenance of respondent's lines and rolling stock. Together with the makers of blueprints, petitioner constitutes the means by which men throughout respondent's system obtain the information they must have to maintain the railroad's trains, equipment, track, and structures.
10
The very purpose of petitioner's job is to further physical maintenance of an interstate railroad system. Proper performance of her duties makes an obvious contribution to the maintenance of that system. We hold that the petitioner, by the performance of her duties, is furthering the interstate transportation in which the respondent is engaged. 'The word 'furtherance' is a comprehensive term. Its periphery may be vague, but admittedly it is both large and elastic.' Shelton v. Thomson, 7 Cir., 148 F.2d 1, 3. Petitioner's duties here come within the confines of that concept.
11
Similarly, those duties which 'in any way directly or closely and substantially affect' interstate commerce in the railroad industry must necessarily be marked out through the process of case-by-case adjudication. This definition and the 'furtherance' definition of employment in interstate commerce in the 1939 amendment are set forth in the disjunctive. In some situations they may overlap. Here we hold that, for the reasons already given, performance of petitioner's duties has a close and substantial effect upon the operation of respondent's interstate activities. Cf. Overstreet v. North Shore Corp., 318 U.S. 125, 63 S.Ct. 494, 87 L.Ed. 656.
12
Petitioner's duties brought her within the coverage of § 1 as amended, and the District Court therefore had jurisdiction over this suit under the Federal Employers' Liability Act. The judgment below is reversed and the cause remanded to the District Court for further proceedings.
13
Reversed.
14
Mr. Justice BURTON dissents for the reasons stated below in the opinion of the Court of Appeals.
15
Mr. Justice FRANKFURTER, with whom Mr. Justice REED and Mr. Justice HARLAN join, dissenting.
16
Dissenters are not empowered to define the scope of a decision, but the way they read it may induce dissent. So it is with what the Court has here written. The opinion does not state in terms that the Amendment of August 11, 1939, 53 Stat. 1404, to the Federal Employers' Liability Act of April 22, 1908, 35 Stat. 65, has so drastically changed the limited scope of that Act to those employees of an interstate carrier who are, more or less, directly concerned with its transportation operations as to make it reach all the employees of such interstate carrier whom Congress in the exercise of its constitutional power to regulate commerce may cover. I say the Court does not explicitly hold this, but it does hold that a clerical employee is covered by the terms of the Act because a 'part' of her duties is in 'furtherance' of interstate commerce. The Court reads the Amendment of 1939 to the Act of 1908 in a merely lexicographical sense. 'Furtherance' means anything that furthers or helps forward; the petitioner was certainly charged with tasks that furthered or helped to forward the business of the Pennsylvania Railroad Company, a carrier engaged in interstate commerce; ergo, the petitioner, having been injured while 'employed by such carrier in such commerce', has a right of action under the Amendment to the Employers' Liability Act.
17
Were the Court to be as explicit as this, it would at least not open the door, as this decision inevitably does, to new litigation. It is not a juristic requirement that decisions be carried to their logical consequences. It is equally true that capricious distinctions should not be made. Yet they are invited when the rationale of a decision is left, if not cloudy, certainly unlimited. For myself, I do not see how the clerical employee here 'furthers' the business of the Pennsylvania any more than do all the other clerical employees of the Pennsylvania, and the thousands upon thousands of clerical employees on the various railroads throughout the country, even though there may be differences in salary and hierarchical importance among such employees.
18
Accordingly, clerical employees and other obviously non-transportation employees of railroads will bring suits under the Federal Employers' Liability Act when recovery thereunder will, by the law of chance, appear to lawyers advising them to be more advantageous than awards obtainable under state workmen's compensation acts. Indeed, if some employees may seek to avail themselves, for one reason or another, of a state workmen's compensation act, a carrier may resist, under the doctrine of New York Central R. Co. v. Winfield, 244 U.S. 147, 37 S.Ct. 546, 61 L.Ed. 1045, by urging the exclusiveness of a remedy under the Federal Employers' Liability Act. Conversely, if suit is brought under that Act, carriers will doubtless resist, as they have in the past, on the ground that the particular clerical employee is not 'furthering' its business sufficiently to constitute 'furtherance' as intended by the Court in this case. It is not a silly exercise in prophecy to foretell that just as a mass, if indeed not a mess, of cases came before this Court prior to the 1939 Amendment, when the Court gave a much too constricted scope to the Act (see cases collected in Frankfurter and Landis, The Business of the Supreme Court, pp. 207—208), so a new series of sterile litigation will be stimulated by this decision.
19
I part company with the Court not in its reading of English but in its assumption that the construction of the Amendment to the Federal Employers' Liability Act is merely a matter of reading English. The Act of August 11, 1939, is the last in a series of consistently developing statutes. As such, it is an organism, projected into the future out of its past. It is not merely a collection of words for abstract annotation out of the dictionary. The process of judicial construction must be mindful of the history of the legislation, of the purpose which infused it, of the difficulties which were encountered in effectuating this purpose, of the aims of those most active in relieving these difficulties. Above all, we should be mindful of the central concern of the body of enactments that constitute the Federal Employers' Liability Act throughout all the vicissitudes of the legislation. It would be redundant to detail these considerations in view of Judge Goodrich's opinion below. 3 Cir., 227 F.2d 810. A few additional observations are pertinent.
20
Of course, the Act of 1939 sought to remove hindrances that had revealed themselves in subjecting carriers to liability for injuries due to negligence. But the preoccupation of the whole course of this legislation was with protection to those who were peculiarly exposed to injuries because of the nature of their occupation, i.e., the hazardous business of railroading. A very important obstacle to recovery was the doctrine of the assumption of risk as part of the general law of negligence that was made the basis of the federal right. Congress abolished asssumption of risk as a defense. See Tiller v. Atlantic Coast Line R. Co., 318 U.S. 54, 63 S.Ct. 444, 87 L.Ed. 610. Another great difficulty derived from this Court's construction of the Commerce Clause whereby it confined application of the Federal Employers' Liability Act to injuries sustained by an employee if at the moment of injury his work was related to interstate transportation. This mode of approach derived from the Employers' Liability Cases, Howard v. Illinois Central R. Co., 287 U.S. 463, 28 S.Ct. 141, 52 L.Ed. 297, and the Second Employers' Liability Cases, Mondou v. New York, N.H. & Hartford R. Co., 223 U.S. 1, 32 S.Ct. 169, 56 L.Ed. 327, and produced a series of decisions which led Judge Learned Hand to say 'The cases are full of casuistry * * *.' Central R. Co. of New Jersey v. Monahan, 2 Cir., 11 F.2d 212, 213.
21
I agree with the Court in finding that the '1939 amendment was designed to obliterate fine distinctions'; but they were made by courts only in relation to employees who worked in the context of the hazardous business of transportation. The amendatory legislation was addressed to judicial distinctions affecting these transportation workers that bore no practical relation to the essential conditions of their employment; these distinctions never touched others in a totally different category of employment because the Federal Employers' Liability Act never remotely applied to them. In order to obliterate such 'fine distinctions,' it is not necessary to jump over the moon and wipe out the basic distinction between those whose duties are tied to transportation, whatever may have been their precise work at the moment of injury, and those employees who are exposed by way of permanent occupation to no greater or different potential hazards than are the thousands upon thousands of like workers in offices other than those of railroads whom Congress has left to remedies under state law. It was on the presupposition of this cardinal distinction between transportation and non-transportation employees of railroads that the Federal Employers' Liability Act was amended in 1939. To make it apply to clerical workers who 'further,' in a dictionary sense of the term, the interstate commerce business of railroads would have as much justification, but no more, as it would have for Congress to pass a Federal Employers' Liability Act for all employees who further large enterprises in the conduct of their interstate commerce. The whole course of history of the Federal Employers' Liability Act as well as due regard for the text of the Amendment of 1939, in its entire context, calls for affirmance of the decision below.
| 78
|
351 U.S. 493
76 S.Ct. 952
100 L.Ed. 1357
SOUTHERN PACIFIC COMPANY, Petitioner,v.Charles M. GILEO et al.
No. 257.
Argued May 1, 1956.
Decided June 11, 1956.
Mr.
Arthur B. Dunne, San Francisco, Cal., for petitioner.
Mr. Clifton Hildebrand, Oakland, Cal., for respondents Gileo and Eelk.
Mr.Thomas C. Perkins, Sacramento, Cal., for respondent Eufrazia.
Mr. Nathaniel S. Colley, Sacramento, Cal., for respondents Moreno and Aranda.
Mr. Justice MINTON delivered the opinion of the Court.
1
These five cases present questions of the extent of coverage of the Federal Employers' Liability Act, as amended.1
2
Petitioner, an interstate common carrier by railroad, owns and operates a large carshop, known as Shop No. 9, at Sacramento, California. This shop contains a department for repair of petitioner's cars temporarily removed from service and a department engaged in the construction of new cars for use in interstate commerce by petitioner and a subsidiary.
3
Respondents Gileo, Eufrazia and Eelk were employed by petitioner in Shop No. 9. Gileo worked on repair of petitioner's cars already in service for almost 10 years prior to his transfer to new car construction 5 months before he was injured. Eufrazia did repair work for 9 months before he was assigned to new car construction a month prior to his injury. Eelk had worked a month on repairs, was transferred to new car construction for 5 weeks, was reassigned to repair work for a month and had been back on new car construction for 3 months when he incurred his injury. Thus, all three of these respondents had at one time worked on repair jobs in Shop No. 9, but there is no dispute that they were engaged exclusively in new car construction when their injuries were incurred.
4
Respondents brought separate suits against petitioner for recovery under the F.E.L.A. Respondent Gileo sued in the Superior Court for the City and County of San Francisco, and respondents Eufrazia and Eelk sued in the Superior Court for the County of Sacramento. In all three suits, petitioner claimed that the F.E.L.A. did not apply because neither it nor respondents were engaged in interstate commerce and that therefore the courts were without jurisdiction to entertain the actions, the exclusive remedy for injured employees in these circumstances resting with the Industrial Accident Commission under the California Workmen's Compensation Act. This challenge to the jurisdiction of the court was rejected in the Gileo case, the court ruling as a matter of law that the F.E.L.A. governed the situation before it. Petitioner having stipulated the issues of negligence and the amount of damages, judgment was entered for Gileo. The trial court in the Eufrazia and Eelk cases ruled in favor of petitioner's contention that it lacked jurisdiction because the F.E.L.A. was not applicable, and judgment was entered for petitioner before trial was had on the issues of negligence and damages. The Supreme Court of California held, in separate decisions, that the Act applied to each of the respondents.2 We granted certiorari, 350 U.S. 818, 76 S.Ct. 79, because the cases involve interpretation of an important federal statute governing railroad employer obligations to its injured employees.
5
In the Eufrazia and Eelk cases, the Supreme Court of California simply entered an order reversing the decisions of the trial court. Unlike Gileo, petitioner did not stipulate with respect to the issues of negligence and damages. There were no trials of these issues, and, under California practice, the effect of the Supreme Court of California's unqualified reversal is to remand the cases to the trial court. See Gospel Army v. City of Los Angeles, 331 U.S. 543, 546, 67 S.Ct. 1428, 1429, 91 L.Ed. 1662. Since the issues of negligence and damages remain to be tried, there is no final judgment in the highest court of the State, and this Court, therefore, lacks jurisdiction to review the Eufrazia and Eelk cases. 28 U.S.C. § 1257, 28 U.S.C.A. § 1257. We therefore dismiss the writs in those two cases.
6
The sole question which the Gileo case presents is whether or not an employee of an interstate rail carrier who is injured while performing work on new cars to be used in interstate commerce by the carrier and its subsidiary can maintain an action for damages against his employer under the F.E.L.A., as amended.
7
Section 1 of the F.E.L.A., with which we are here concerned, originally provided that 'every common carrier by railroad while engaging in commerce' between the States 'shall be liable in damages to any person suffering injury while he is employed by such carrier in such commerce' for injury or death resulting wholly or partly from the negligence of the carrier.3 This Court early construed the statute to require that the employee be 'at the time of the injury, engaged in interstate transportation, or in work so closely related to it as to be practically a part of it' in order to qualify for coverage under the Act. Shanks v. Delaware, L. & W.R. Co., 239 U.S. 556, 558, 36 S.Ct. 188, 189, 60 L.Ed. 436. Later, in Raymond v. Chicago, M. & St. P.R. Co., 243 U.S. 43, 45, 37 S.Ct. 268, 269, 61 L.Ed. 583, and New York Central R. Co. v. White, 243 U.S. 188, 192, 37 S.Ct. 247, 248, 61 L.Ed. 667, this Court held that employees engaged in or connected with new construction for their railroad employers were not engaged in interstate commerce within the meaning of the Act and were therefore not entitled to its benefits. See also Pedersen v. Delaware, L. & W.R. Co., 229 U.S. 146, 152, 33 S.Ct. 648, 649, 57 L.Ed. 1125. The 'moment of injury' and 'new construction' doctrines were the source of much confusion to the railroads, their employees and the courts, with the result that the reports were replete with decisions drawing very fine distinctions in determining whether an employee was engaged in interstate commerce within the contemplation of the Act so as to entitle him to bring suit for damages thereunder for injuries incurred while in the carrier's employ. The uncertainty had grown to such proportions that Congress, in 1939, added the following paragraph to § 1 of the Act:4
8
'Any employee of a carrier, any part of whose duties as such employee shall be the furtherance of interstate or foreign commerce; or shall, in any way directly or closely and substantially, affect such commerce as above set forth shall, for the purposes of this Act, be considered as being employed by such carrier in such commerce and shall be considered as entitled to the benefits of this Act and of an Act entitled 'An Act relating to the liability of common carriers by railroad to their employees in certain cases' (approved April 22, 1908), as the same has been or may hereafter be amended.'
9
The Senate, in its report on the amendments to the Act, characterized one aim of the amendment in this manner: '1. It broadens and clarifies the law in its application to employees who may be killed or injured while in the service of a railroad company engaged in interstate or foreign commerce.'5 Petitioner concedes that the 1939 amendment abolishes the 'moment of injury' rule of the Shanks case, supra. But it vigorously contends that, because Congress, in amending the Act, did not alter the first paragraph of § 1, it is liable only for employee injuries incurred while the railroad is 'engaging in commerce,' between the States. It is argued that, since the railroad was here engaged in the construction of new cars, which activity, under the 'new construction' doctrine of Raymond and White, supra, is not commerce between the States, employees injured while engaging in new construction are not covered by the 1939 amendment. With this we cannot agree.
10
The 1939 amendment to § 1 of the Act provides that '(a)ny employee of a carrier, any part of whose duties as such employee shall be the furtherance of interstate or foreign commerce; or shall, in any way directly or closely and substantially, affect such commerce' as described in the first paragraph of § 1, 'shall, for the purposes of this Act, be considered as being employed by such carrier in such commerce and shall be considered as entitled to the benefits' of the Act. This amendatory language makes it plain that if a railroad employee either furthers interstate commerce in the performance of any part of his duties or in any way 'directly or closely and substantially' affects such commerce, Congress has placed such an employee on an equal footing, for purposes of coverage under the Act, with those employees who, prior to the 1939 amendment, were held to be employed by the railroads in commerce between the States. Therefore, in determining whether respondent Gileo is entitled to the benefits of the F.E.L.A., the pertinent inquiry is not whether 'new construction' is interstate commerce under the test of Raymond and White. Rather, the crucial question is whether any part of Gileo's duties as a railroad employee furthers interstate commerce or in any way directly or closely and substantially affects such commerce.
11
Petitioner is engaged in the manufacture of its own railroad cars for use in performing its transportation function in interstate commerce. Such new construction is an integral element in the carrier's total operations, and it follows that workmen employed to build these new cars perform duties which are in 'furtherance' of interstate commerce. Furthermore, in carrying out these duties, such employees affect interstate commerce 'directly or closely and substantially.' Failure to perform their duties would preclude delivery to the railroad of cars which it considers essential to its transportation needs and would substantially impede the carrier's performance of its transportation function and thus the interstate commerce in which it is engaged. This interpretation is consistent with the letter and spirit of the 1939 amendment, which Congress enacted to cure the evils of hypertechnical distinctions which had developed in over 30 years of F.E.L.A. litigation. Whatever justification there may have been before the amendment for holding that employees working on repairs of a railroad's instrumentalities were engaged in interstate commerce and therefore entitled to the benefits of the Act, Pedersen v. Delaware, L. & W.R. Co., supra, while those who were working on construction of new railroad facilities were not engaged in interstate commerce and therefore were not covered by the Act, Raymond and White, supra, has been swept away by the 1939 amendment. This Court recently rejected the 'new construction' doctrine in determining whether an employee is 'engaged in commerce' within the meaning of a like provision in the Fair Labor Standards Act, 29 U.S.C.A. § 201 et seq. Mitchell v. C. W. Vollmer & Co., 349 U.S. 427, 75 S.Ct. 860, 861, 99 L.Ed. 1196. We hold that § 1 of the F.E.L.A., as amended, covers respondent Gileo.
12
Respondent Aranda was injured while employed by petitioner as a wheel molder in its wheel foundry at Sacramento, California. There wheels are made to be joined to axles which form the truck base for the petitioner's cars, both new and those already in interstate service. Since wheels which wear out cannot be repaired, they must be recast or remolded and, as a result, worn wheels are continually shipped from all points on petitioner's rail network to its Sacramento foundry for remolding and eventual return to petitioner's rolling stock. A certain level of inventory is indispensable to effective utilization of this mode of operation. The operation itself is a vital link in the chain of petitioner's function as an interstate rail carrier. It is thus plain that Aranda's duties as a wheel molder both served to further interstate commerce and directly or closely and substantially affected such commerce. We therefore hold that he is entitled to the benefits of the Act.
13
Respondent Moreno was employed as a laborer and was injured while laying rails in a retarder yard which petitioner was constructing for the purpose of facilitating the movement of freight trains in interstate commerce by use of a new 'switching' method. The yard was to be used in connection with petitioner's main line of track. It was opened to interstate traffic 4 months after Moreno was injured. Passage of the 1939 amendment makes unnecessary indulgence in nice distinctions relating to whether Moreno was engaged in new construction or construction which, although new, was merely a substitute for petitioner's existing method of switching cars. Cf. Agostino v. Pennsylvania R. Co., D.C., 50 F.Supp. 726. In view of what we have said above, it is clear that Moreno, in the performance of his duties, was furthering interstate commerce and that his work directly or closely and substantially affected commerce, within the meaning of the 1939 amendment.
The judgments in
14
Gileo v. Southern Pacific Co.,
15
Aranda v. Southern Pacific Co.,
Moreno v. Southern Pacific Co., are
16
Affirmed.
The writs in
17
Eufrazia v. Southern Pacific Co.,
Eelk v. Southern Pacific Co., are
18
Dismissed.
19
Mr. Justice HARLAN concurs in the result.
20
Mr. Justice REED and Mr. Justice FRANKFURTER agree that the writs in Southern Pacific Co. v. Eufrazia and Southern Pacific Co. v. Eelk must be dismissed because they were improvidently granted for want of final state court judgments. Regarding Southern Pacific Co. v. Gileo, Southern Pacific Co. v. Aranda, and Southern Pacific Co. v. Moreno, they disagree with the Court's theory in applying the Act of 1939, for the reasons set forth in Mr. Justice Frankfurter's dissent in Reed v. Pennsylvania R. Co., 351 U.S. 502, 76 S.Ct. 958.
1
35 Stat. 65, as amended, 53 Stat. 1404, 45 U.S.C. § 51, 45 U.S.C.A. § 51.
2
Gileo v. Southern Pacific Co., 44 Cal.2d 539, 282 P.2d 872; Eufrazia v. Southern Pacific Co., 44 Cal.2d 881, 282 P.2d 879; Eelk v. Southern Pacific Co., 44 Cal.2d 882, 282 P.2d 880. The decisions below holding the two remaining respondents covered by the Act are reported in Aranda v. Southern Pacific Co., 44 Cal.2d 543, 282 P.2d 875, and Moreno v. Southern Pacific Co., 44 Cal.2d 547, 282 P.2d 877.
3
35 Stat. 65:
'That every common carrier by railroad while engaging in commerce between any of the several States or Territories, or between any of the States and Territories, or between the District of Columbia and any of the States or Territories, or between the District of Columbia or any of the States or Territories and any foreign nation or nations, shall be liable in damages to any person suffering injury while he is employed by such carrier in such commerce, or, in case of the death of such employee, to his or her personal representative, for the benefit of the surviving widow or husband and children of such employee; and, if none, then of such employee's parents; and, if none, then of the next of kin dependent upon such employee, for such injury or death resulting in whole or in part from the negligence of any of the officers, agents, or employees of such carrier, or by reason of any defect or insufficiency, due to its negligence, in its cars, engines, appliances, machinery, track, roadbed, works, boats, wharves, or other equipment.'
4
53 Stat. 1404.
5
S.Rep. No. 661, 76th Cong., 1st Sess. 2.
| 78
|
351 U.S. 487
76 S.Ct. 880
100 L.Ed. 1352
Curtis REID, Superintendent of the District of Columbia Jail, Appellant,v.Clarice B. COVERT.
No. 701.
Argued May 3, 1956.
Decided June 11, 1956.
Mr.
Marvin E. Frankel, Washington, D.C., for appellant.
Mr. Frederick Bernays Wiener, Washington, D.C., for appellee.
Mr. Justice CLARK delivered the opinion of the Court.
1
Mrs. Clarice Covert was convicted and sentenced to life imprisonment by a military court-martial which tried her at a United States Air Force base in England for the murder of her husband, an Air Force sergeant. She was brought to the United States and confined in the Federal Reformatory for Women, Alderson, West Virginia. On appeal, the United States Court of Military Appeals set aside her conviction on grounds not material here, and she was transferred to the District of Columbia jail to await a rehearing by court-martial at Bolling Air Force Base, Washington, D.C. While there she filed a petition for a writ of habeas corpus in the United States District Court for the District of Columbia, alleging that she was not subject to court-martial jurisdiction because Article 2(11) of the Uniform Code of Military Justice, 50 U.S.C. § 552, 50 U.S.C.A. § 552, was unconstitutional. The District Court ordered the writ to issue, and the Government appealed directly to this Court. Postponing the question of jurisdiction until a hearing on the merits, 350 U.S. 985, 76 S.Ct. 476, we scheduled this case for argument with Kinsella v. Krueger, 351 U.S. 470, 76 S.Ct. 886.
2
At the outset, appellee questions the jurisdiction of this Court to hear the case on direct appeal from the District Court. For reasons hereafter stated, we conclude that we have jurisdiction.
3
Appellee's principal argument on the merits is answered by our decision in Kinsella v. Krueger, 351 U.S. 470, 76 S.Ct. 886. It is also contended, however, that whatever jurisdiction the military may have had to try Mrs. Covert by court-martial under Article 2(11) was lost by her return to the United States and delivery to the custody of civilian authorities. We conclude that in the circumstances of this case this argument is without merit.
I.
4
The question of our jurisdiction involves an interpretation of 28 U.S.C. § 1252, 28 U.S.C.A. § 1252:
5
'Any party may appeal to the Supreme Court from an interlocutory of final judgment, decree or order of any court of the United States * * * holding an Act of Congress unconstitutional in any civil action, suit, or proceeding to which the United States or any of its agencies, or any officer or employee thereof, as such officer or employee, is a party.'
6
It is conceded that, in issuing the writ of habeas corpus, the District Court held an Act of Congress unconstitutional. Appellee's sole contention is that appellant, the Superintendent of the District of Columbia jail, does not come within the requirement of § 1252 that 'the United States or any of its agencies, or any officer or employee thereof, as such officer or employee,' be a party.
7
The Superintendent is responsible to the Director of the Department of Corrections of the District of Columbia, who in turn is selected by the Board of Commissioners of the District. Reorganization Order No. 34, D.C.Code 1951, App. to Title 1, Supp. III, p. 34. The Commissioners are appointed by the President and are officers of the United States under Art. II, § 2, of the Constitution. The Superintendent has a statutory duty to 'receive and keep in the Washington Asylum and Jail all prisoners committed thereto for offenses against the United States.' D.C.Code 1951, § 24—410. Mrs. Covert was placed in the District jail on orders of the Air Force, because there are no accommodations for women prisoners at Bolling Air Force Base, where the rehearing of her trial by court-martial is scheduled.
8
It has long been settled that an officer, while holding prisoners for the United States, is the 'keeper of the United States,' Randolph v. Donaldson, 9 Cranch 76, 86, 3 L.Ed. 662, and, as such, is an officer of the United States. Since appellant was required to 'receive and keep' prisoners of the United States, he is, to that extent, an officer of the United States. It is not necessary to say, and we do not say, that the District of Columbia in these circumstances is an 'agency' of the United States. For, whether the Government should maintain its own jail in the District of Columbia, or utilize the local facilities, is simply a matter of administrative convenience, and it would do violence to the purpose of Congress to provide a 'prompt review of the constitutionality of federal acts', Fleming v. Rhodes, 331 U.S. 100, 104, 67 S.Ct. 1140, 1142, 91 L.Ed. 1368, to interpret § 1252 restrictively. For all practical purposes, the District of Columbia jail is, in this case, the 'jail of the United States,' Randolph v. Donaldson, supra, and the superintendent is its keeper. As the custodian of Mrs. Covert, a federal prisoner, appellant is an officer or employee of the United States for purposes of § 1252.
II.
9
On the merits, Mrs. Covert contends that Article 2(11) should be restricted geographically, and therefore military jurisdiction over her expired upon her return to the United States. She also contends, that as a civilian, she is no longer subject to the Code, since she is not in 'custody of the armed forces' under Article 2(7).
10
An entirely different case might be presented if Mrs. Covert had terminated her status as a person 'accompanying the armed forces without the continental limits of the United States' by returning to this country voluntarily. But that is not this case. The issue here is whether we should create an exception to the general rule that jurisdiction of a tribunal, once acquired, continues until final disposition. At the time of her courtmartial in England, Mrs. Covert was subject to military jurisdiction under Article 2(11), Kinsella v. Krueger, 351 U.S. 470, 76 S.Ct. 886. Her transfer under orders of the Air Force was in furtherance of that jurisdiction. To accept Mrs. Covert's argument would result in the anomalous situation that military jurisdiction, validly exercised under Article 2(11), would be defeated by the imposition of a sentence under Article 58, 50 U.S.C. § 639, 50 U.S.C.A. § 639, which provides for confinement 'in any penal or correctional institution under the control of the United States, or which the United States may be allowed to use.' It would be unreasonable to hold that the services retained jurisdiction of military prisoners that they kept in foreign countries but lost jurisdiction of prisoners confined in penal institutions in the United States.
11
Nor is jurisdiction defeated by reversal of Mrs. Covert's conviction and the ordering of a rehearing. The military courts have recognized rehearings to be but continuations of the original proceedings, United States v. Padilla, 5 C.M.R. 31, 42; United States v. Moore, 5 C.M.R. 438, 444; United States v. Milbourne, 15 C.M.R. 527, 528; and the legislative history of Article 63 of the Code bears out the fact that they were so intended by Congress. H.R. Rep. No. 491, 81st Cong., 1st Sess. 30; S. Rep. No. 486, 81st Cong., 1st Sess. 27.
12
We also note that this case is clearly distinguishable from U.S. ex rel. Toth v. Quarles, 350 U.S. 11, 76 S.Ct. 1. Toth had returned to the United States and been honorably discharged months before the specifications were filed charging him with an offense committed while a soldier in Korea. The Air Force had relinquished all jurisdiction over Toth before any charge was filed against him. But here, Mrs. Covert was charged, tried, convicted, sentenced and imprisoned pursuant to a valid exercise of court-martial jurisdiction while she was concededly within the provisions of Article 2(11). We are not deciding here when, in other circumstances, Article 2(11) jurisdiction may terminate. In this case we hold only that military jurisdiction, once validly attached, continues until final disposition of the case.
13
Reversed.
14
[For reservation of Mr. Justice FRANKFURTER, see ante, p. 481.]
15
[For dissent of Mr. Chief Justice WARREN, Mr. Justice BLACK, and Mr. Justice DOUGLAS, see ante, p. 485.]
| 12
|
351 U.S. 470
76 S.Ct. 886
100 L.Ed. 1342
Nina KINSELLA, Warden of the Federal Reformatory for Women, Alderson, West Virginia, Petitioner,v.Walter KRUEGER.
No. 713.
Argued May 3, 1956.
Decided June 11, 1956.
Mr.
Marvin E. Frankel, Washington, D.C., for petitioner.
Mr. Frederick Bernays Wiener, Washington, D.C., for respondent.
Mr. Justice CLARK delivered the opinion of the Court.
1
Congress, in Article 2(11) of the Uniform Code of Military Justice, has provided that all persons 'accompanying the armed forces without the continental limits of the United States' and certain named territories shall be subject to the Code if such jurisdiction is authorized under 'any treaty or agreement to which the United States is or may be a party or to any accepted rule of international law.' 50 U.S.C. § 552, 50 U.S.C.A. § 552. Pursuant to this article and a subsequent agreement between the United States and Japan,1 Mrs. Dorothy Krueger Smith was tried by a general court-martial in Tokyo, Japan, for the premeditated murder of her husband, a colonel in the United States Army. She was found guilty and sentenced to life imprisonment. 10 C.M.R. 350. Her conviction was affirmed by the Board of Review, 17 C.M.R. 314, and the Court of Military Appeals, 5 U.S.C.M.A. 314, and she began serving her sentence in the Federal Reformatory for Women, Alderson, West Virginia.
2
Thereafter, a petition for a writ of habeas corpus was filed on Mrs. Smith's behalf by her father, respondent herein. The petition alleged that the court-martial had no jurisdiction to try Mrs. Smith because Article 2(11) of the Uniform Code of Military Justice violates both Art. III, § 2, and Amendment VI of the Federal Constitution, which guarantee the right to trial by jury to a civilian. The United States District Court for the Southern District of West Virginia issued a preliminary writ. After a hearing, which included the submission of briefs and unlimited oral argument, the writ was discharged and Mrs. Smith was remanded to the custody of the Warden. 137 F.Supp. 806. In order to expedite the determination of the case, the Government itself sought certiorari while an appeal was pending before the Court of Appeals for the Fourth Circuit. We granted review on March 12, 1956, 350 U.S. 986, 76 S.Ct. 476, because of the serious constitutional question presented and its far-reaching importance to our Armed Forces stationed in some sixty-three different countries throughout the world. We agree with the decision of the District Court.
3
In its entirety, Art. 2(11), 50 U.S.C. § 552, 50 U.S.C.A. § 552, provides that:
4
'The following persons are subject to this chapter:
5
'(11) Subject to the provisions of any treaty or agreement to which the United States is or may be a party or to any accepted rule of international law, all persons serving with, employed by, or accompanying the armed forces without the continental limits of the United States and without the following territories: That part of Alaska east of longitude one hundred and seventy-two degrees west, the Canal Zone, the main group of the Hawaiian Islands, Puerto Rico, and the Virgin Islands * * *.'
6
Mrs. Smith comes squarely within the terms of this provision. As a military dependent, she had accompanied her husband beyond the continental limits of the United States. Prior to her husband's death they lived together in Washington Heights, an American community in Tokyo composed exclusively of American servicemen and their dependents. Japan, at the time of the offense, had ceded to the United States 'exclusive jurisdiction over all offenses which may be committed in Japan by members of the United States armed forces, the civilian component, and their dependents * * *.' Art. XVII, 3 UST (Part 3) 3354. Since Article 2(11) concededly applies to this case if it was within the power of Congress to enact, the constitutionality of that provision is the sole question presented. Essentially, we are to determine only whether the civilian dependent of an American serviceman authorized to accompany him on foreign duty may constitutionally be tried by an American military court-martial in a foreign country for an offense committed in that country.
7
Trials by court-martial are governed by the Uniform Code of Military Justice, 64 Stat. 109, 50 U.S.C. § 551 et seq., 50 U.S.C.A. § 551 et seq. The Code was carefully drawn by Congress to include the fundamental guarantees of due process, and in operation it has provided a fair and enlightened system of justice. However, courts-martial are not required to provide all the protections of constitutional courts; therefore, to try by court-martial a civilian entitled to trial in an Article III court is a violation of the Constitution. United States ex rel. Toth v. Quarles, 350 U.S. 11, 76 S.Ct. 1. Accordingly, our first inquiry is directed to the question whether, as a matter of constitutional right, an American citizen outside of the continental limits of the United States and in a foreign country is entitled to trial before an Article III court for an offense committed in that country.
8
In making this determination, we are not faced with the question 'whether the Constitution is operative, for that is self-evident, but whether the provision relied on is applicable.'2 Entirely aside from the power of Congress under Article III of the Constitution, it has been well-established since Chief Justice Marshall's opinion in American Insurance Co. v. Canter, 1 Pet. 511, 7 L.Ed. 242, that Congress may establish legislative courts outside the territorial limits of the United States proper. The procedure in such tribunals need not comply with the standards prescribed by the Constitution for Article III courts. In cases arising from Hawaii,3 the Philippines,4 and Puerto Rico,5 this Court has recognized the power of Congress to enact a system of laws which did not provide for trial by jury. By 1922 it was regarded as clearly settled' that the jury provisions of Article III and the Sixth and Seventh Amendments 'do not apply to territory belonging to the United States which has not been incorporated into the Union.' Balzac v. People of Porto Rico, 258 U.S. 298, 304—305, 42 S.Ct. 343, 345, 66 L.Ed. 627.
9
In an earlier case, this Court had sustained the constitutionality of an Act of Congress which created consular courts to try, pursuant to treaties, American citizens for crimes committed in Japan, China, and other countries. In re Ross, 140 U.S. 453, 11 S.Ct. 897, 35 L.Ed. 581. Ross, an American Seaman convicted of murder by a consular court in Yokohama, Japan, contended that he had been deprived of his constitutional right to both grand and petit juries. In rejecting this claim, the Court pointed out that these constitutional guarantees were not applicable to a consular court sitting outside the constinental United States. 140 U.S. at page 464, 11 S.Ct. at page 900. Recounting the long-established practice of governments to provide 'for the exercise of judicial authority in other countries by (their) officers appointed to reside therein', 140 U.S. 463, 11 S.Ct. 900, the Court noted that the requirement of a grand and petit jury in these circumstances 'would defeat the main purpose of investing the consul with judicial authority.' 140 U.S. at page 465, 11 S.Ct. at page 900. In 1929, citing Ross with approval in Ex parte Bakelite Corp., 279 U.S. 438, 451, 49 S.Ct. 411, 413, 73 L.Ed. 789, this Court reaffirmed the doctrine that 'legislative courts * * * exercise their functions within particular districts in foreign territory, and are invested with a large measure of jurisdiction over American citizens in those districts. The authority of Congress to create them and to clothe them with such jurisdiction has been upheld by this Court and is well recognized.' These cases establish beyond question that the Constitution does not require trial before an Article III court in a foreign country for offenses committed there by an American citizen and that Congress may establish legislative courts for this purpose.
10
Having determined that one in the circumstances of Mrs. Smith may be tried before a legislative court established by Congress,6 we have no need to examine the power of Congress 'To make Rules for the Government and Regulation of the land and naval Forces' under Article I of the Constitution. If it is reasonable and consonant with dur process for Congress to employ the existing system of courts-martial for this purpose, the enactment must be sustained.
11
In the present day, we, as a Nation, have found it necessary to the preservation of our security to maintain American forces in some sixty-three foreign countries. The practical necessity of allowing these men to be accompanied by their families where possible has been recognized by Congress as well as the services, and the result has been the creation of American communities of mixed civilian and military population at bases throughout the world. In all matters of substance, the lives of military and civilian personnel alike are geared to the local military organization which provides their living accommodations, medical facilities and transportation from and to the United States. We could not find it unreasonable for Congress to conclude that all should be governed by the same legal standard to the end that they receive equal treatment under law. The effect of a double standard might well create sufficient unrest and confusion to result in the destruction of effective law enforcement.7 By the enactment of Article 2(11) of the Code, Congress has provided that all shall be subject to the same system of justice and that the military commander who bears full responsibility for the care and safety of those civilians attached to his command shall also have authority to regulate their conduct.
12
It was conceded before this Court that Congress could have established, or might yet establish, a system of territorial or consular courts to try offenses committed by civilian dependents abroad. While this would be within the power of Congress, In re Ross, supra, clearly nothing in the Constitution compels it. The power to create a territorial or consular court does not preclude, but must necessarily include, the power to provide for trial before a military tribunal unless that alternative is 'so clearly arbitrary or capricious that legislators acting reasonably could not have believed it to be necessary or appropriate for the public welfare.'8 The choice among different types of legislative tribunals is peculiarly within the power of Congress, Ex parte Bakelite Corp., 279 U.S. 438, 451, 49 S.Ct. 411, 413, 73 L.Ed. 789, and we are concerned only with the constitutionality, not the wisdom, of this choice.
13
In selecting the Uniform Code of Military Justice, Congress might have sought to avoid needless and potentially harmful duplication of a legal system already extant in every foreign nation where our troops are stationed. On the other hand, Congress could well have determined that the Code was adequate to the purpose to be achieved and would afford more safeguards to an accused than any other available procedure. The Code is a uniform system of legal procedure, applicable beyond any constitutional question to all servicemen stationed abroad. It was adopted by Congress only after an exhaustive study of several years duration and the consultation of acknowledged authorities in the fields of constitutional and military law.9 In addition to the fundamentals of due process, it includes protections which this Court has not required a State to provide10 and some procedures which would compare favorably with the most advanced criminal codes. We find no constitutional defect in the fact that the Code does not provide for indictment by grand jury or trial by petit jury. In these respects it does not differ from the procedures specifically approved by this Court in other types of legislative courts established abroad by Congress. In re Ross, supra; Territory of Hawaii v. Mankichi, 190 U.S. 197, 23 S.Ct. 787, 47 L.Ed. 1016; Dorr v. United States, 195 U.S. 138, 24 S.Ct. 808, 49 L.Ed. 128; Balzac v. Porto Rico, supra.
14
Furthermore, since under the principles of international law each nation has jurisdiction of the offenses committed within its own territory, The Schooner Exchange v. McFaddon, 7 Cranch 116, 136, 3 L.Ed. 287, the essential choice involved here is between an American and a foreign trial. Foreign nations have relinquished jurisdiction to American military authorities only pursuant to carefully drawn agreements which presuppose prompt trial by existent authority.11 Absent the effective exercise of jurisdiction thus obtained, there is no reason to suppose that the nations involved would not exercise their sovereign right to try and punish for offenses committed within their borders. Under these circumstances, Congress may well have determined that trial before an American court-martial in which the fundamentals of due process are assured was preferable to leaving American servicemen and their dependents throughout the world subject to widely varying standards of justice unfamiliar to our people.12
15
We note that this case presents no problem of the jurisdiction of a military court-martial sitting within the territorial limits of the United States or the power of Congress to provide for trial of Americans sojourning, touring, or temporarily residing abroad. No question of the legal relation between treaties and the Constitution is presented. On the question before us, we find no constitutional bar to the power of Congress to enact Article 2(11) of the Uniform Code of Military Justice.
16
The judgment is affirmed.
17
Affirmed.
18
Reservation of Mr. Justice FRANKFURTER.
19
The Court today sustains Mrs. Clarice B. Covert's conviction by a general court-martial in England for the murder of her husband, a sergeant in the United States Air Force, and the conviction of Mrs. Dorothy Krueger Smith by a general court-martial in Japan for the murder of her husband, a colonel in the United States Army. The Court does so, although it announces that 'we have no need to examine the power of Congress 'To make Rules for the Government and Regulation of the land and naval Forces' under Article I of the Constitution.' The plain inference from this is that the Court is not prepared to support the constitutional basis upon which the Covert and Smith courts-martial were instituted and the convictions were secured.
20
The Uniform Code of Military Justice which governed these proceedings, and the international arrangements with England and Japan whereby the United States was allowed to exercise jurisdiction over the alleged crimes, are concerned with, directed toward, and explicitly acknowledged as legan measures that had their source in, and were obviously to be an exercise of, the constitutional power of Congress 'To make Rules for the Government and Regulation of the land and naval Forces.' As provided by the Uniform Code of Military Justice, Mrs. Smith and Mrs. Covert were tried as though they were members of the Armed Forces. In view of this Court's opinion in Toth v. United States ex rel. Quarles, 350 U.S. 11, 76 S.Ct. 1, and the fact that the Constitution 'clearly distinguishes the military from the civil class as separate communities' and 'recognizes no third class which is part civil and part military—military for a particular purpose or in a particular situation, and civil for all other purposes and in all other situations * * *,' Winthrop, Military Law and Precedents (2d ed. 1896), 145, the Court's failure to rest its decision upon the congressional power 'To make Rules for the Government and Regulation of the land and naval Forces' is significant.
21
Having put out of consideration reliance on the immediately pertinent constitutional provision bearing on the difficulties raised by these cases, the Court sustains the convictions by two lines of argument that obviously have nothing whatever to do with the regulation of the Armed Forces of the United States. The Court relies on In re Ross, 140 U.S. 453, 11 S.Ct. 897, 35 L.Ed. 581, a case that represents, historically and juridically, an episode of the dead past about as unrelated to the world of today as the one-hoss shay is to the latest jet airplane. In complete disregard of the political and legal sources purporting to render women like Mrs. Smith and Mrs. Covert amenable to military courts-martial for crimes committed abroad, the Court draws on the system of capitulations whereby Western countries, including the United States, compelled powerless Eastern and Asiatic nations to surrender their authority over conduct within their confines by citizens of these Western nations to the rule of Western 'consular courts.' The Eastern nations were made to yield because 'of the barbarous and cruel punishments inflicted in those countries, and the frequent use of torture to enforce confession from parties accused * * *.' In re Ross, supra, 140 U.S. at page 463, 11 S.Ct. at page 899. I do not suppose that the arrangements by which Great Britain and Japan gave the United States jurisdiction over the murders with which Mrs. Smith and Mrs. Covert were charged are to be deemed concessions wrung by the United States as were the capitulations wrung, often by force, from the Ottoman Empire and other Eastern nations because they were deemed inferior by the West, long ago and far away.*
22
The Court derives its second line of argument from the decisions of this Court which have evolved the power of Congress to deal with territory acquired by purchase or through war, beginning with the statute of 1822, which set up the government of Florida. See American Insurance Co. v. Canter, 1 Pet. 511, 7 L.Ed. 242. I must confess inability to appreciate the bearing of the series of complicated adjudications dealing with the difficult problems relating to 'organized' and 'unorganized' territories of the United States to legislation by Congress treating civilians accompanying members of the Armed Forces abroad as though they were part of the Armed Forces and therefore amenable to the Code of Military Justice.
23
Grave issues affecting the status of American civilians throughout the world are raised by these cases; they are made graver by the arguments on which the Court finds it necessary to rely in reaching its result. Doubtless because of the pressure under which the Court works during its closing weeks, these arguments have been merely adumbrated in its opinion. To deal adequately with them, however, demands of those to whom they are not persuasive more time than has been available to examine and to analyze in detail the historical underpinning and implication of the cases relied upon by the Court, as a preliminary to a searching critique of their relevance to the problems now before the Court. For the moment, it must suffice, by way of example, to indicate that by resorting to In re Ross the Court has torn from its historical context an institution—the consular court—that had a totally different source and a totally different purpose than the source and purpose of Art. 2(11) of the Uniform Code of Military Justice, 64 Stat. 107, 109. A glimpse into the international environment and political assumptions out of which the consular court system derived and of which it was a part suffices to indicate the scope of the inquiry for which the Court's opinion calls. Such a glimpse is afforded by the justification for consular courts urged by the Government on this Court 65 years ago. Reliance was placed on this authoritative view of Secretary of State Hamilton Fish:
24
'A report made to Congress by my predecessor, Mr. Seward * * * shows that it has been the habit of this Department to regard the judicial power of our consular officers in Japan as resting upon the assent of the Government of that kingdom, whether expressed by formal convention or by tacit acquiescence in the notorious practice of the consular courts. In other words, they were esteemed somewhat in the same light as they would have been if they were constituted by the Mikado with American citizens as judges, and with all the authority with which a Japanese tribunal is invested in respect to the native subjects of Japan, to the extent that our Government will admit a jurisdiction understood to be extremely arbitrary. They were, so to speak, the agents of a depotism (sic), only restrained by such safeguards as our own Government may interpose for the protection of citizens who come within its sway.' Brief for the United States, p. 25, in In re Ross, 140 U.S. 453, 11 S.Ct. 897, 35 L.Ed. 581.
25
Time is required not only for the primary task of analyzing in detail the materials on which the Court relies. It is equally required for adequate reflection upon the meaning of these materials and their bearing on the issues now before the Court. Reflection is a slow process. Wisdom, like good wine, requires maturing.
26
Moreover, the judgments of this Court are collective judgments. They are neither solo performances nor debates between two sides, each of which has its mind quickly made up and then closed. The judgments of this Court presuppose full consideration and reconsideration by all of the reasoned views of each. Without adequate study there cannot be adequate reflection. Without adequate reflection there cannot be adequate deliberation and discussion. And without these, there cannot be that full interchange of minds which is indispensable to wise decision and its persuasive formulation.
27
The circumstances being what they are, I am forced, deeply as I regret it, to reserve for a later date an expression of my views.
28
Mr. Chief Justice WARREN, Mr. Justice BLACK, and Mr. Justice DOUGLAS, dissent.
29
The decisions just announced have farreaching importance. They subject to military court-martial, even in time of peace, the wives, mothers and children of members of the Armed Forces serving abroad even though these dependents have no connection whatever with the Armed Forces except their kinship to military personnel and their presence abroad. The questions raised are complex, the remedy drastic, and the consequences far-reaching upon the lives of civilians. The military is given new powers not hitherto thought consistent with our scheme of government.
30
For these reasons, we need more time than is available in these closing days of the Term in which to write our dissenting views. We will file our dissents during the next Term of Court.
1
Relevant portions of the administrative agreement are:
'Article IX
'1. The United States shall have the right to bring into Japan for purposes of this Agreement persons who are members of the United States armed forces, the civilian component, and their dependents.
'Article XVII
'1. Upon the coming into force with respect to the United States of the 'Agreement between the Parties to the North Atlantic Treaty regarding he Status of their forces', signed at London on June 19, 1951, the United States will immediately conclude with Japan, at the option of Japan, an agreement on criminal jurisdiction similar to the corresponding provisions of that Agreement.
'2. Pending the coming into force with respect to the United States of the North Atlantic Treaty Agreement referred to in paragraph 1, the United States service courts and authorities shall have the right to exercise within Japan exclusive jurisdiction over all offenses which may be committed in Japan by members of the United States armed forces, the civilian component, and their dependents, excluding their dependents who have only Japanese nationality. Such jurisdiction may in any case be waived by the United States.
'4. The United States undertakes that the United States service courts and authorities shall be willing and able to try and, on conviction, to punish all offenses against the laws of Japan which members of the United States armed forces, civilian component, and their dependents may be alleged on sufficient evidence to have committed in Japan, and to investigate and deal appropriately with any alleged offense committed by members of the United States armed forces, the civilian component, and their dependents, which may be brought to their notice by Japanese authorities or which they may find to have taken place. The United States further undertakes to notify the Japanese authorities of the disposition made by United States service courts of all cases arising under this paragraph. The United States shall give sympathetic consideration to a request from Japanese authorities for a waiver of its jurisdiction in cases arising under this paragraph where the Japanese Government considers such waiver to be of particular importance. Upon such waiver, Japan may exercise its own jurisdiction.
'5. In the event the option referred to in paragraph 1 is not exercised by Japan, the jurisdiction provided for in paragraph 2 and the following paragraphs shall continue in effect. In the event the said North Atlantic Treaty Agreement has not come into effect within one year from the effective date of this Agreement, the United States will, at the request of the Japanese government, reconsider the subject of jurisdiction over offenses committed in Japan by members of the United States armed forces, the civilian component, and their dependents.' 3 UST (Part 3) 3346, 3353—3356.
2
Mr. Justice White concurring in Downes v. Bidwell, 182 U.S. 244, 292, 21 S.Ct. 770, 789, 45 L.Ed. 1088. See Dorr v. United States, 195 U.S. 138, 24 S.Ct. 808, 49 L.Ed. 128. 'The Dorr Case shows that the opinion of Mr. Justice White of the majority, in Downes v. Bidwell, has become the settled law of the court.' Taft, C.J., in Balzac v. Porto Rico, 258 U.S. 298, 305, 42 S.Ct. 343, 346, 66 L.Ed. 627.
3
Territory of Hawaii v. Mankichi, 190 U.S. 197, 23 S.Ct. 787, 47 L.Ed. 1016.
4
Dorr v. United States, 195 U.S. 138, 24 S.Ct. 808, 49 L.Ed. 128.
5
Balzac v. Porto Rico, 258 U.S. 298, 42 S.Ct. 343, 66 L.Ed. 627.
6
In this respect this case is entirely different from United States ex rel. Toth v. Quarles, supra, where the defendant, after discharge from military service and return to this country, was entitled to trial before an Article III court, and we found 'no excuse for new expansion of court-martial jurisdiction at the expense of the normal and constitutionally preferable system of trial by jury.' 350 U.S. at pages 22—23, 76 S.Ct. at page 8. In Toth we found that Article 3(a) of the Uniform Code of Military Justice 'necessarily encroaches on the jurisdiction of federal courts set up under Article III of the Constitution.' 350 U.S. at page 15, 76 S.Ct. at page 4. No like constitutional bar exists in the present case.
7
One need only consider the disruptive effect of establishing another type of legislative court to deal with the same offenses in the same territorial jurisdiction as the military tribunals. In cases of conspiracy or joint crime, parallel trials would have to be held in separate courts. Since the trials could not proceed at the same time, one would of necessity precede and influence the other, and results could understandably be disparate. Nor is the problem of insignificant proportions. Reliable figures show that our Armed Forces overseas are accompanied by approximately a quarter of a million dependents and civilian workers. Figures relating to the Army alone show that in the 6 fiscal years from July 1, 149, to June 30, 1955, a total of 2,280 civilians were tried by courts-martial. While it is true that the vast majority of these prosecutions were for minor offenses, the volume alone shows the serious problem that would be presented by the administration of a dual system of courts.
8
Mr Justice Brandeis dissenting in Burns Baking Co. v. Bryan, 264 U.S. 504, 534, 44 S.Ct. 412, 421, 68 L.Ed. 813.
9
See Hearings Before a Subcommittee of the Committee on Armed Services, House of Representatives, 81st Cong., 1st Sess. (1949).
10
E.g., self-incrimination, compare Art. 31 and 149b, and 72b, Manual for Courts-Martial, with Adamson v. People of State of California, 332 U.S. 46, 67 S.Ct. 1672, 91 L.Ed. 1903; former jeopardy, compare Arts. 44 and 63 with Palko v. State of Con-
necticut, 302 U.S. 319, 58 S.Ct. 149, 82 L.Ed. 288; use of illegally obtained evidence, compare 152, Manual for Courts-Martial, with Wolf v. People of State of Colorado, 338 U.S. 25, 69 S.Ct. 1359, 93 L.Ed. 1782.
11
See note 1, supra, and Schwartz, International Law and the NATO Status of Forces Agreement, 53 Col.L.Rev. 1091; Re, The NATO Status of Forces Agreement and International Law, 50 N.W.U.L.Rev. 349.
12
It has been suggested that bringing American citizens to this country for trial for offenses committed abroad may be a preferable solution even if it is not required by the Constitution. Congress
might well have concluded that this suggestion was completely impractical. First, a condition precedent to trial in this country would be the consent of the foreign nation concerned in each individual case. This consent could always be withheld and it is likely that foreign nations would refuse to cede jurisdiction over serious offenses when trial might be held many thousands of miles away. Even where jurisdiction was obtained, the deterrent effect of such prosecutions might well be vitiated by the distance and delay involved. Secondly, both the Government and the accused would face serious problems in the production of witnesses. Depositions for the Government are not permitted in criminal cases. See Rule 15, Federal Rules of Criminal Procedure, 18 U.S.C.A. Attendance of foreign witnesses could be only on a voluntary basis and the testimony of no foreign witness could be compelled if the witness or his government refused. The expense of transporting witnesses would be considerable for the Government and probably impossible for a defendant, whose successful defense may depend on the demeanor of one witness. In fairness, the Government would have to bear the expense of transporting the defendant's witnesses as well as its own, and the possibilities of abuse are obvious.
Finally, a breakdown of the figures on trial by courts-martial of civilians abroad from 1950—1955 shows that some 2,000 of the 2,280 cases tried involved offenses for which the maximum punishment was six months or less. The Government might be unwilling to undergo the heavy expense and inconvenience of trial here for such minor offenses. The alternatives would be either trial by the foreign country or no trial at all; the result must be the practical abdication of American judicial authority, precisely what Congress wished to avoid.
*
See the opinion, in 1855, of Attorney General Caleb Cushing: 'The legal rationale of the treaty stipulations as to China, with which we are now chiefly concerned, and their relation to the legislative authority of the United States, are explained in a dispatch of the Minister who negotiated the treaty, as follows:
"I entered China with the formed general conviction that the United States ought not to concede to any foreign state, under any circumstances, jurisdiction over the life and liberty of a citizen of the United States, unless that foreign state be of our own family of nations,—in a word, a Christian state. * * *" 7 Op.Atty.Gen. 495, 496—497.
| 12
|
351 U.S. 345
76 S.Ct. 919
100 L.Ed. 1242
Cecil Reginald JAY, Petitioner,v.John P. BOYD, District Director, Immigration and Naturalization Service.
No. 503.
Argued May 3, 1956.
Decided June 11, 1956.
[Syllabus from pages 345-346 intentionally omitted]
MessersWill Maslow, New York City, John Caughlan, Seattle, Wash., for petitioner.
Mr.John V. Lindsay, New York City, for respondent.
Mr. Justice REED delivered the opinion of the Court.
1
Petitioner brought this habeas corpus proceeding to test the validity of the denial of his application under §§ 244(a)(5) and 244(c) of the Immigration and Nationality Act of 1952, 66 Stat. 215, 216, 8 U.S.C. §§ 1254(a)(5) and 1254(c), 8 U.S.C.A. § 1254(a)(5), (c), for discretionary suspension of deportation. He contends that the denial of his application was unlawful because based on confidential, undisclosed information. The District Court denied the writ, holding, so far as pertinent here, that, 'after complying with all the essentials of due process of law in the deportation hearing and in the hearing to determine eligibility for suspension of deportation, (the Attorney General may) consider confidential information outside the record in formulating his discretionary decision.'1 The Court of Appeals affirmed, concluding, inter alia, that petitioner was not 'denied due process of law in the consideration of his application for suspension of deportation because of the use of this confidential information.' 222 F.2d 820, 820—821, rehearing denied 224 F.2d 957. We granted certiorari, 350 U.S. 931, 76 S.Ct. 303, to consider the validity of 8 CFR, Rev.1952, § 244.3, the Attorney General's regulation which provides:
2
's 244.3 Use of confidential information. In the case of an alien qualified for * * * suspension of deportation under section * * * 244 of the Immigration and Nationality Act the determination as to whether the application for * * * suspension of deportation shall be granted or denied (whether such determination is made initially or on appeal) may be predicated upon confidential information without the disclosure thereof to the applicant, if in the opinion of the officer or the Board making the determination the disclosure of such information would be prejudicial to the public interest, safety, or security.'
3
Following a hearing, the fairness of which is unchallenged, petitioner was ordered deported in 1952 pursuant to 8 U.S.C. (1946 ed., Supp. V) § 137—3. That section provided for the deportation of any alien 'who was at the time of entering the United States, or has been at any time thereafter,' a member of the Communist Party of the United States.2 Petitioner, a citizen of Great Britain, last entered the United States in 1921. At the deportation hearing he admitted having been a voluntary member of the Communist Party from 1935 through 1940. He attacked the validity of the deportation order in the courts below on the ground that there is 'no lawful power * * * under the Constitution ow laws of the United States' to deport one who has 'at no time violated any condition imposed at the time of his entry.' But that point has been abandoned, and in this Court petitioner in effect concedes that he is deportable. See Galvan v. Press, 347 U.S. 522, 74 S.Ct. 737, 98 L.Ed. 911; Harisiades v. Shaughnessy, 342 U.S. 580, 72 S.Ct. 512, 96 L.Ed. 586.
4
In 1953, upon motion of petitioner, the deportation order was withdrawn for the purpose of allowing petitioner to seek discretionary relief from the Attorney General under § 244(a)(5) of the Act. The application for suspension of deportation was filed and a hearing thereon was held before a special inquiry officer of the Immigration and Naturalization Service.3 The special inquiry officer found petitioner to be qualified for suspension of deportation4—that is, found that petitioner met the statutory prerequisites to the favorable exercise of the discretionary relief.5 But the special inquiry officer decided the case for suspension did not 'warrant favorable action' in view of certain 'confidential information.'6 The Board of Immigration Appeals dismissed an appeal, basing its decision 'Upon a full consideration of the evidence of record and in light of the confidential information available.'7 Thus, the Board in considering the appeal reviewed the undisclosed information as well as the evidence on the open record. Petitioner then commenced the present habeas corpus action.
5
As previously noted, § 244(a)(5) of the Act provides that the Attorney General 'may in his discretion' suspend deportation of any deportable alien who meets certain statutory requirements relating to moral character, hardshop and period of residence within the United States. If the Attorney General does suspend deportation under that provision, he must file, pursuant to § 244(c), 'a complete and detailed statement of the facts and pertinent provisions of law in the 'case with Congress, giving 'the reasons for such suspension.' So far as pertinent here, deportation finally cancels only if Congress affirmatively approves the suspension by a favorable concurrent resolution within a specified period of time. There is no express statutory grant of any right to a hearing on an application to the Attorney General for discretionary suspension of deportation. For purposes of effectuating these statutory provisions, the Attorney General adopted regulations delegating his authority under § 244 of the Act to special inquiry officers;8 giving the alien the right to apply to suspension during a deportation hearing;9 putting the burden on the applicant to establish the statutory requirements for eligibility for suspension;10 allowing the alien-applicant to submit any evidence in support of his application;11 requiring the special inquiry officer to present evidence bearing on the applicant's eligibility for relief;12 and requiring a 'written decision' with 'a discussion of the evidence relating to the alien's eligibility for such relief and the reasons for granting or denying such application.'13 The Attorney General also promulgated the regulation under attack here, 8 CFR, Rev.1952, § 244.3, see p. 2, supra, providing for the use by special inquiry officers and the Board of Immigration Appeals of confidential information in ruling upon suspension applications if disclosure of the information would be prejudicial to the public interest, safety or security.
6
We note that petitioner does not suggest that he did not receive a full and fair hearing on evidence of record with respect to his statutory eligibility for suspension of deportation. In fact, petitioner recognizes that the special inquiry officer found in his favor on all issues relating to eligibility for the discretionary relief and that those findings were adopted by the Board of Immigration Appeals.14 This favorably disposed of petitioner's eligibility for consideration for suspension of deportation—the first step in the suspension procedure. Thus, we have here the case of an admittedly deportable alien who has been ordered deported following an unchallenged hearing, and who has been accorded another full and fair hearing on the issues respecting his statutory qualifications for discretionary suspension of deportation.
7
It is urged upon the Court that the confidential information regulation is invalid because inconsistent with § 244 of the Act. In support of this claim, petitioner argues that § 244 implicitly requires the Attorney General to give a hearing on applications for suspension of deportation. It is then said that this statutory right is nullified and rendered illusory by the challenged regulation, and that therefore the regulation is invalid. But there is nothing in the language of § 244 of the Act upon which to base a belief that the Attorney General is required to give a hearing with all the evidence spread upon an open record with respect to the considerations which may bear upon his grant or denial of an application for suspension to an alien eligible for that relief. Assuming that the statute implicitly requires a hearing on an open record as to the specified statutory prerequisites to favorable action, there is no claim here of a denial of such a hearing on those issues. Moreover, though we assume a statutory right to a full hearing on those issues, it does not follow that such a right exists on the ultimate decision—the exercise of discretion to suspend deportation.
8
Eligibility for the relief here involved is governed by specific statutory standards which provide a right to a ruling on an applicant's eligibility. However, Congress did not provide statutory standards for determining who, among qualified applicants for suspension, should receive the ultimate relief. That determination is left to the sound discretion of the Attorney General. The statute says that, as to qualified deportable aliens, the Attorney General 'may, in his discretion' suspend deportation.15 It does not restrict the considerations which may be relied upon or the procedure by which the discretion should be exercised. Although such aliens have been given a right to a discretionary determination on an application for suspension, cf. United States ex rel. Accardi v. Shaughnessy, 347 U.S. 260, 74 S.Ct. 499, 98 L.Ed. 681, a grant thereof is manifestly not a matter of right under any circumstances, but rather is in all cases a matter of grace. Like probation or suspension of criminal sentence, it 'comes as an act of grace', Escoe v. Zerbst, 295 U.S. 490, 492, 55 S.Ct. 818, 819, 79 L.Ed. 1566, and 'cannot be demanded as a right', Berman v. United States, 302 U.S. 211, 213, 58 S.Ct. 164, 166, 82 L.Ed. 204.16 And this unfettered discretion of the Attorney General with respect to suspension of deportation is analogous to the Board of Parole's powers to release federal prisoners on parole.17 Even if we assume that Congress has given to qualified applicants for suspension of deportation a right to offer evidence to the Attorney General in support of their applications, the similarity between the discretionary powers vested in the Attorney General by § 244(a) of the Act on the one hand, and judicial probation power and executive parole power on the other hand, leads to a conclusion that § 244 gives no right to the kind of a hearing on a suspension application which contemplates full disclosure of the considerations entering into a decision. Clearly there is no statutory right to that kind of a hearing on a request for a grant of probation after criminal conviction in the federal courts.18 Nor is there such a right with respect to an application for parole.19 Since, as we hold, he Attorney General's discretion is not limited by the suggested hearing requirement, the challenged regulation cannot be said to be inconsistent with § 244(a) of the Act.
9
Petitioner says that a hearing requirement, with a consequent disclosure of all considerations going into a decision, is made implicit by § 244(c) if not by § 244(a). Section 244(c), it will be recalled, requires the Attorney General to file with Congress 'a complete and detailed statement of the facts' as to cases in which suspension is granted, 'with reasons for such suspension.' This statutory mandate does not, however, order such a report on cases in which suspension is denied. Section 244(c) actually emphasizes the fact that suspension is not a matter of right. Congress was interested in limiting grants of this relief to the minimum. It evidenced an interest only in the reasons relied upon by the Attorney General for granting an application so that it could have an opportunity to accept or reject favorable administrative decisions. This in no way suggests that the applicant is to be apprised of the reasons for a denial of his request for suspension.
10
Petitioner also points to § 235(c) of the Act, 8 U.S.C. § 1225(c), 8 U.S.C.A. § 1225(c), which specifically authorizes the Attorney General to determine under some circumstances that an alien is excludable 'on the basis of information of a confidential nature.'20 It is argued from this that had Congress intended to permit the use of confidential information in rulings upon applications for suspension of deportation, it would have expressly so provided in language as specific as that used in § 235(c). The difficulty with this argument is that § 235(c) is an exception to an express statutory mandate under § 236(a) of the Act, 8 U.S.C. § 1226(a), 8 U.S.C.A. § 1226(a), that determinations of admissibility be 'based only on the evidence produced at the inquiry.' No such express mandate exists with respect to suspension of deportation, and, therefore, no specific provision for the use of confidential information was needed if normally contemplated by the broad grant of discretionary power to the Attorney General.
11
It is next argued that, even if the confidential information regulation is not inconsistent with § 244(a), it nevertheless should be held invalid. Emphasizing that Congress did not in terms authorize such a procedure, petitioner contends that the Act should be construed to provide a right to a hearing because only such a construction would be consistent with the 'tradition and principles of free government.'21 On its face this is an attractive argument. Petitioner urges that, in view of the severity of the result flowing from a denial of suspension of deportation, we should interpret the statute by resolving all doubts in the applicant's favor. Cf. United States v. Minker, 350 U.S. 179, 187—188, 76 S.Ct. 281, 286, 287. But we must adopt the plain meaning of a statute, however severe the consequences. Cf. Galvan v. Press, 347 U.S. 522, 528, 74 S.Ct. 737, 741, 98 L.Ed. 911. As we have already stated, suspension of deportation is not given to deportable aliens as a right, but by congressional direction, it is dispensed according to the unfettered discretion of the Attorney General. In the face of such a combination of factors we are constrained to construe the statute as permitting decisions based upon matters outside the administrative record, at least when such action would be reasonable.
12
It may be that § 244(a) cannot be interpreted as allowing a decision based on undisclosed information in every case involving a deportable alien qualified for suspension. Thus, it could be argued that, where there is no compelling reason to refuse to disclose the basis of a denial of an application, the statute does not contemplate arbitrary secrecy. However, the regulation under attack here limits the use of confidential information to instances where, in the opinion of the special inquiry officer or the Board of Immigration Appeals, 'the disclosure * * * would be prejudicial to the public interest, safety, or security.' If the statute permits any withholding of information from the alien, manifestly this is a reasonable class of cases in which to exercise that power.22
13
Our conclusion in this case is strongly supported by prior decisions of this Court. In both United States ex rel. Knauff v. Shaughnessy, 338 U.S. 537, 70 S.Ct. 309, 94 L.Ed. 317, and Shaughnessy v. United States ex rel. Mezei, 345 U.S. 206, 73 S.Ct. 625, 97 L.Ed. 956, we upheld a regulation of the Attorney General calling for the denial of a hearing in exclusion cases where the Attorney General determined that an alien was excludable on the basis of confidential information, and where, as here, the disclosure of that information would be prejudicial to the public interest.23 And again, as here, the statutes involved in those cases did not expressly authorize the use of such information in making the administrative ruling. It is true that a resident alien in a deportation proceeding has constitutional protections unavailable to a nonresident alien seeking entry into the United States, and that those protections may militate against construing an ambiguous statute as authorizing the use of confidential information in a deportation proceeding. Cf. Kwong Hai Chew v. Colding, 344 U.S. 590, 73 S.Ct. 472, 97 L.Ed. 576. But the issue involved here under § 244(a) is not whether an alien is deportable, but whether, as a deportable alien who is qualified for suspension of deportation, he should be granted such suspension. In view of the gratuitous nature of the relief, the use of confidential information in a suspension proceeding is more clearly within statutory authority than were the regulations involved in the Knauff and Mezei cases.
14
Concluding that the challenged regulation is not inconsistent with the Act, we must look to petitioner's claim that the use of undisclosed confidential information is unlawful because inconsistent with related regulations governing suspension of deportation procedures. As previously noted, an application for suspension is considered as part of the 'hearing' to determine deportability. 8 CFR, Rev.1952, §§ 242.53(c) and 242.54(d); and see 8 CFR, Rev.1952, § 242.5. The alien is entitled to 'submit any evidence in support of his application which he believes should be considered by the special inquiry officer.' 8 CFR, Rev.1952, § 242.54(d). The hearing to determine deportability, during which the suspension application is considered, is to be a 'fair and impartial hearing.' 8 CFR, Rev.1952, § 242.53(b). And a decision of the special inquiry officer on the request for suspension must contain 'the reasons for granting or denying such application.' 8 CFR, Rev.1952, § 242.61(a).
15
We conclude that, although undisclosed information was used as a basis for denying suspension of deportation, none of the above-mentioned regulations was transgressed. While an applicant for suspension is, by regulation, entitled to 'submit any evidence in support of his application,' that is merely a provision permitting an evidentiary plea to the discretion of those who are to make the decision. In this respect it is not unlike the 'statement' and the opportunity to present 'information in mitigation of punishment' to which a convicted defendant is entitled under Rule 32(a) of the Federal Rules of Criminal Procedure before criminal sentence is imposed.24 And the situation is not different because the matter of suspension of deportation is taken up in the 'fair and impartial' deportation 'hearing.' Assuming that such a 'hearing' normally precludes the use of undisclosed information, the 'hearing' here involved necessarily contemplates the use of confidential matter in some circumstances. We must read the body of regulations governing suspension procedures so as to give effect, if possible, to all of its provisions. Cf. Lawson v. Suwannee Fruit & S.S Co., 336 U.S. 198, 69 S.Ct. 503, 93 L.Ed. 611.
16
This same rationale leads us to conclude that the requirement of a decision containing 'reasons' is fully complied with by a statement to the effect that the application has been denied on the basis of confidential information, the disclosure of which would be prejudicial to the public interest, safety or security. Section 244.3 says that such information may be used 'without the disclosure thereof to the applicant.' Reading the provision for a statement of the 'reasons' for a decision in the light of § 244.3, it follows that express reliance on confidential information constitutes a statement of the 'reasons' for a denial of suspension within the meaning of § 242.61(a). If 'reasons' must be disclosed but confidential information need not be, the former mandate, which certainly comprehends the latter provision, must be satisfied by an express invocation of the latter provision.
17
Congress has provided a general plan dealing with the deportation of those aliens who have not obtained citizenship although admitted to residence. Since it could not readily make exception for cases of unusual hardship or extenuating circumstances, those matters were left to the consideration and discretion of the Attorney General. We hold that in this case the Attorney General has properly exercised his powers under the suspension statute and we affirm the judgment below.
18
It is so ordered.
19
Affirmed.
20
Mr. Chief Justice WARREN, dissenting.
21
In conscience, I cannot agree with the opinion of the majority. It sacrifices to form too much of the American spirit of fair play in both our judicial and administrative processes.
22
In the interest of humanity, the Congress, in order to relieve some of the harshness of the immigration laws, gave the Attorney General discretion to relieve hardship in deportation cases. I do not believe it was 'an unfettered discretion,' as stated in the opinion. It was an administrative discretion calling for a report to Congress on the manner of its use. The Attorney General, recognizing this, rightfully provided for an administrative hearing for the exercise of that discretion. On the other hand, he provided by his regulation that his numerous subordinate hearing officers might, in spite of a record clearly establishing a right to relief, deny that relief if, on the basis of undisclosed 'confidential' information, the relief would in their opinion be 'prejudicial to the public interest, safety, or security.' Such a hearing is not an administrative hearing in the American sense of the term. It is no hearing.
23
Yet, on the basis of such 'confidential' information, after more than 40 years of residence here, we are tearing petitioner from his relatives and friends and from the country he fought to sustain,* when the record shows he has not offended against our laws, bears a good reputation, and would suffer great hardship if deported. Petitioner is not a citizen of the United States, but the Due Process Clause protects 'persons.' To me, this is not due process. If sanction of this use and effect of 'confidential' information is confirmed against this petitioner by a process of judicial reasoning, it may be recognized as a principle of law to be extended against American citizens in a myriad of ways.
24
I am unwilling to write such a departure from American standards into the judicial or administrative process or to impute to Congress an intention to do so in the absence of much clearer language than it has used here.
25
Mr. Justice BLACK, dissenting.
26
This is a strange case in a country dedicated by its founders to the maintenance of liberty under law. The petitioner, Cecil Reginald Jay, is being banished because he was a member of the Communist Party from 1935 to 1940. His Communist Party membership at that time did not violate any law. The Party was recognized then as a political organization and had candidates in many state elections. Jay's Communist Party membership ended 10 years before such membership was made a ground for deportation by Congress. 64 Stat. 1006—1008. It is for this past Communist membership, wholly legal when it existed, that Jay has been ordered deported.1
27
Even though an alien has been found to be deportable, Congress has provided a procedure which he can invoke to have his deportation suspended. 66 Stat. 163, 214—216, 8 U.S.C. §§ 1254(a)(5), 1254(c), 8 U.S.C.A. § 1254(a)(5), (c). He is entitled to suspension 'in the discretion' of the Attorney General if he 'proves' that during the preceding 10 years he has been a person of good moral character and if deportation would result in exceptional and unusual hardship. The language of the statute plainly shows that an alien must be given an opportunity to 'prove' these things if he can. This of course means that he must have a full and fair hearing. Jay asked to be allowed to give such proof and in fact proved his case to the complete satisfaction of the hearing officer who passed on it. But the hearing officer 'after considering confidential information' refused to suspend deportation. The Board of Immigration Appeals dismissed Jay's appeal.
28
Jay is now 65 years of age. He came to this country from England for permanent residence in 1914. He has remained here even since except for time he served in the army of our ally Canada during the First World War. Despite the Government's far-flung investigative network it has not been able to dig up one single incident of misconduct on the part of Jay during his entire 65 years which it is willing to produce in court.2 That Jay is a person of good moral character and that his enforced exile from this country will work an 'exceptional and extremely unusual hardship' have been found by the hearing officer.
29
I agree with The CHIEF JUSTICE, Mr. Justice FRANKFURTER and Mr. Justice DOUGLAS that the Attorney General's regulation authorizing Jay and others like him to be deported upon alleged anonymous information should be held invalid as beyond the statutory power of the Attorney General. But a majority of the Court holds otherwise. This makes it necessary to consider the constitutionality of the use of anonymous information for such a purpose. In Footnote 21 of its opinion the Court states, somewhat as an aside, that 'the constitutionality of § 244 as herein interpreted gives us no difficulty.' In this easy fashion the Court disposes of a challenge to the power of Congress to banish people on information allegedly given federal officers by persons whose names are not revealed and whose statements (if made) are shrouded in the darkness which surrounds 'confidential information.'
30
What is meant by 'confidential information'? According to officers of the Immigration Service it may be 'merely information we received off the street'; or 'what might be termed as hearsay evidence, which could not be gotten into the record * * *'; or 'information from persons who were in a position to give us the information that might be detrimental to the interests of the Service to disclose that person's name * * *'; or 'such things, perhaps, as income-tax returns, or maybe a witness who didn't want to be disclosed, or where it might endanger their life, or something of that kind * * *.'3 No nation can remain true to the ideal of liberty under law and at the same time permit people to have their homes destroyed and their lives blasted by the slurs of unseen and unsworn informers. There is no possible way to contest the truthfulness of anonymous accusations. The supposed accuser can neither be identified nor interrogated. He may be the most worthless and irresponsible character in the community. What he said may be wholly malicious, untrue, unreliable, or inaccurately reported. In a court of law the triers of fact could not even listent to such gossip, must less decide the most trifling issue on it.
31
The Court today is not content with allowing exile on the basis of anonymous gossip. It holds that the hearing officer who condemned Jay could act in his 'unfettered discretion,' subject only to review by the Board of Immigration Appeals. Of course the Court refers to the Attorney General's 'unfettered discretion,' but participation of the Attorney General in this case is a fiction. The Court concedes in Note 8 of its opinion that the Attorney General does not personally exercise discretion in these cases. Therefore, the 'unfettered discretion' to which the Court subjects persons like Jay is the unfettered discretion of inquiry officers of the Immigration Service, reviewable only by the Board of Immigration Appeals. Under our system of government there should be no way to subject the life and freedom of one individual to the 'unfettered' or, more accurately, the 'arbitrary' power of another. Article III of our Constitution and the Bill of Rights intend that people4 shall not have valuable rights and privileges taken away from them by government unless the deprivation occurs after some kind of court proceeding where witnesses can be confronted and questioned and where the public can know that the rights of individuals are being protected.
32
Unfortunately, this case is not the first one in recent years where arbitrary power has been approved and where anonymous information has been used to take away vital rights and privileges of people.5 The Court disposes of what has been done to Jay to its satisfaction by saying that his right to stay here if he proves he is a good citizen 'comes as an act of grace,' like 'probation or suspension of criminal sentence.' But probation and suspension of criminal sentence come only after conviction of crime. Cf. Williams v. People of State of New York, 337 U.S. 241, 69 S.Ct. 1079, 93 L.Ed. 1337. Here the Government with all of its resources has not been able to prove that Jay ever committed a crime of any kind. And Congress provided the suspension procedure so that one in Jay's situation could get special relief if he proved his good moral character. Viewed realistically this suspension procedure is an integral part of the process of deciding who shall be deported.
33
No amount of legal reasoning by the Court and no rationalization that can be devised can disguise the fact that the use of anonymous information to banish people is not consistent with the principles of a free country. Unfortunately there are some who think that the way to save freedom in this country is to adopt the techniques of tyranny. One technique which is always used to maintain absolute power in totalitarian governments is the use of anonymous information by government against those who are obnoxious to the rulers.6 In connection with another case like this7 I referred to a statement made by the Roman Emperor Trajan to Pliny the Younger around the end of the First Century. Rome at that time was prosecuting the Christians for alleged subversive activities. Pliny expressed his doubts to Trajan as to the best method of handling the prosecutions. He wrote Trajan, 'An anonymous information was laid before me containing a charge against several persons, who upon examination denied they were Christians, or had ever been so. * * *' Trajan replied, 'You have adopted the right course, my dearest Secundus, in investigating the charges against the Christians who were brought before you. * * * Anonymous informations ought not to be received in any sort of prosecution. It is introducing a very dangerous precedent, and is quite foreign to the spirit of our age.'8
34
It was also foreign to the brave spirit of the American age that gave birth to our constitutional system of courts with their comprehensive safeguards for fair public trials. In those courts a defendant's fate is to be determined by independent judges and juries who hear evidence given by witnesses in their presence and in the presence of the accused.9 But this case shows how far we have departed from the carefully conceived plan to safeguard individual liberty. Although the Court today pays lip service to judicial review, a hearing officer's condemnation of Jay is held final and unreviewable. His condemnation is in open defiance of all the public testimony given, and rests exclusively on 'confidential information' he claims to have received from unrevealed sources. Unfortunately this condemnation of Jay on anonymous information is not unusual—it manifests the popular fashion in these days of fear. Legal rationalizations10 have been contrived to shift trials from constitutional courts to temporary removable appointees like the hearing officer who decided against Jay.11 And when an accused rises to defend himself before such an officer he is met by a statement that 'We have evidence that you are guilty of something, but we cannot tell you what, nor who gave us the evidence.' If, taking the Bill of Rights seriously he complains, he is met by the rather impatient rejoinder that the Government's safety would be jeopardized by according him the kind of trial the Constitution commands.12 But the core of our constitutional system is that individual liberty must never be taken away by shortcuts, that fair trials in independent courts must never the dispensed with. That system is in grave danger. This case emphasizes that fact. Prosecution of any sort on anonymous information is still too dangerous, just as it was when Trajan rejected it nearly two thousand years ago. Those who prize liberty would do well to ponder this.
35
Mr. Justice FRANKFURTER, dissenting.
36
Since the petitioner was found deportable under the Act of Oct. 16, 1918, 40 Stat. 1012, 8 U.S.C. § 137, as amended, 64 Stat. 1006, 1008, 8 U.S.C. (1946 ed., Supp. V) § 137—3, his deportation would follow automatically had not Congress, in § 244(a)(5) of the Immigration and Nationality Act of 1952, Entrusted the Attorney General with the power of relaxing this dire consequence by suspending the deportation. 66 Stat. 163, 214, 8 U.S.C. § 1254(a)(5), 8 U.S.C.A. § 1254(a)(5). This the Attorney General is authorized to do if the petitioner has been present in the United States for at least ten years since the grounds for his deportation arose, if he can prove that during all of such period he has been and is a person of good moral character, and, finally, if his deportation would, in the opinion of the Attorney General, 'result in exceptional and extremely unusual hardship.' If the Attorney General Finds that all three conditions are satisfied, he 'may in his discretion suspend deportation.' Such is the feature of mitigation with which Congress qualified what obviously is, and was designed to be, a very drastic exercise of its constitutional power to turn aliens out of the country for some past misdeed, often unthinking foolishness, and, it may well be, long after genuine repentance and the evolution of the alien into a worthy member of society.
37
By this provision, Congress plainly responded to the dictates of humanity. But, just as Congress could have exercised to the utmost its power of constitutional severity, so it could appropriately define the mode for its alleviation. It has seen fit to make the Attorney General the agent for its quality of mercy, to be exercised by him 'in his discretion.' The power of dispensation given the Attorney General he can, I have no doubt, withhold without accounting to anyone, and certainly without recourse to judicial review. Congress was evidently content to leave to the conscience of the chief law officer of the Government, the head of the Department of Justice, both the carrying out of its humane purpose and the protection of the public interest.
38
If the Attorney General's conscience is satisfied to act on considerations that he does not desire to expose to the light of day or to impart to an alien whose liberty may be at stake, thereby involving the fate of an innocent family, Congress leaves him free to do so. But Congress has not seen fit to invest his subordinates with such arbitrary authority over the lives of men.
39
One is not unmindful of the fact that the Attorney General is burdened with a vast range of duties, and that he, too, has only twenty-four hours in a day. To be sure, one of his predecessors in the administration of our immigration laws, President Taft's Secretary of Commerce and Labor, himself examined every deportation file in which an appeal was lodged. And Alfred E. Smith cannot have been the only Governor to read the records in the hundreds of applications that came before him each year for executive clemency. But, is in his wisdom the Attorney General devises a system for delegating the means for carrying out the responsibility for which Congress has given him discretion, he cannot also delegate his discretion. (That the nature of a delegated power may preclude regulation, see, e.g., the Canadian case, Attorney-General of Canada v. Brent, (1956) 2 D.L.R.(2d) 503, affirming (1955) 3 D.L.R. 587.)
40
If the Attorney General devises, as he has devised, an administrative system for effectuating § 244(a)(5) of the Act of 1952, administrative arbitrariness is ruled out. If the Attorney General invokes the aid of administrative law, as he has done by establishing a procedure before a special inquiry officer of the Immigration and Naturalization Service and a review of that officer's decision by the Board of Immigration Appeals, these two agencies of administrative law cannot be authorized to defy the presuppositions of a fair hearing. The Attorney General may act on confidential information and Congress has left him to square it with his conscience. But he cannot shelter himself behind the appearance of legal procedure—a system of administrative law—and yet infuse it with a denial of what is basic to such a system. See, e.g., Ohio Bell Telephone Co. v. Public Utilities Comm'n, 301 U.S. 292, 300, 57 S.Ct. 724, 728, 81 L.Ed. 1093.
41
President Eisenhower has explained what is fundamental in any American code. A code devised by the Attorney General for determining human rights cannot be less than Wild Bill Hickok's code in Abilene, Kansas:
42
'It was: meet anyone face to face with whom you disagree. You could not speak up on him from behind, or do any damage to him, without suffering the penalty of an outraged citizenry. If you met him face to face and took the same risks he did, you could get away with almost anything, as long as the bullet was in the front.
43
'And today, although none of you has the great fortune, I think, of being from Abilene, Kansas, you live after all by that same code, in your ideals and in the respect you give to certain qualities. In this country, if someone dislikes you, or accuses you, he must come up in front. He cannot hide behind the shadow. He cannot assassinate you or your character from behind, without suffering the penalties an outraged citizenry will impose.' Press release of remarks of the President, on November 23, 1953, on receiving America's Democratic Legacy Award at dinner on the occasion of the 40th anniversary of the Anti-Defamation League.
44
For me, the philosophy embodied in these remarks rules the situation before us. The petitioner sustained the burden which the statute put upon him to prove himself deserving to remain in this country and to save his family from being disrupted. On the record, the Attorney General's special inquiry officer found that the respondent 'appears to be qualified for suspension of deportation,' and this finding was not upset on appeal. But this finding for the petitioner was nullified on the basis of some 'confidential information.' The petitioner had no means of meeting this 'confidential information.' We can take judicial notice of the fact that in conspicuous instances, not negligible in number, such 'confidential information' has turned out to be either baseless or false. There is no reason to believe that only these conspicuous instances illustrate the hazards inherent in taking action affecting the lives of fellow men on the basis of such information. The probabilities are to the contrary. A system of administrative law cannot justify itself on the assumption that the ' confidential information' available to these inquiry officers and the Board of Appeals is impregnable or even likely to be true. When the Attorney General scrutinizes 'confidential information,' at all events it is the Attorney General who does so. If he is unable to carry out the discretion vested solely in him to act on whatever he chooses to act upon, he must either devise a shifting process that meets the elementary decencies of procedure or advise Congress of his inability to carry out the extraordinary responsibility which it has reposed in him and not in his subordinates.
45
I would reverse.
46
Mr. Justice DOUGLAS, dissenting.
47
The statement that President Eisenhower made in 1953 on the American code of fair play is more than interesting Americana. As my Brother FRANKFURTER says, it is Americana that is highly relevant to our present problem. The President said: 'In this country, if someone dislikes you, or accuses you, he must come up in front. He cannot hide behind the shadow. He cannot assassinate you or your character from behind, without suffering the penalties an outraged citizenry will impose.'1
48
That bit of Americana is relevant here because we have a question as to what a 'hearing' is in the American meaning of the word. Fairness, implicit in our notions of due process, requires that any 'hearing' be full and open with an opportunity to know the charge and the accusers, to reply to the charge, and to meet the accusers. And when Congress provides for a hearing, as it implicitly has in § 244 of the present Act, it should be assumed that Congress has the same lively sense of the requirements of fair play as the Eisenhower code demands.
49
The philosophy of the full hearing, especially as it involves the right to meet the accusers, has been put in classical words by Professor Zechariah Chafee, Jr., in his recent book The Blessings of Liberty (1956), p. 35:
50
'One important benefit from confronting the suspect with his accusers is the opportunity to cross-examine them and rigorously test any dubious statement. As old Sir Matthew Hale says, it 'beats and boults out the truth much better.' Add to that the old-fashioned value of putting people face to face out in the open. Accusers who secretly confer in private with an official or two and a couple of clerks may, as in Hale's time, 'oftentimes deliver that which they will be ashamed to testify publicly.' An honest witness may feel quite differently when he has to repeat his story looking at the man whom he will harm greatly by distorting or mistaking the facts. He can now understand what sort of human being that man is. As for the false witness, the tribunal can learn ever so much more by looking at him than by reading an F.B.I. abstract of his story. The pathological liar and the personal enemy can no longer hide behind a piece of paper.'
51
And see Peters v. Hobby, 349 U.S. 331, 350—352, 75 S.Ct. 790, 799, 800, 99 L.Ed. 1129; O'Brian, National Security and Individual Freedom (1955), pp. 61—63.
52
Harry P. Cain, member of the Subversive Activities Control Board, recently joined the President in endorsing this code of fair play:2
53
'In all of our traditional efforts to protect the individual against oppression and false conviction by the state, we have relied basically and primarily on confrontation and cross-examination. By no other means can those who must judge their fellow man minimize to the fullest and desired extent the mistakes which humans make. Without recourse to these means, it is impossible for anyone accused of anything to protect himself fully against enemies whose evidence may consist of nothing more than malice, vindictiveness, mistaken identity, intolerance, prejudice, or a perverted desire to destroy.'
54
A hearing is not a hearing in the American sense if faceless informers or confidential information may be used to deprive a man of his liberty. That kind of hearing is so un-American that we should lean over backwards to avoid imputing to Congress a purpose to sanction it under § 244.
1
The District Judge wrote no opinion. The quote is taken from the Findings of Fact and Conclusion of Law, Record 15, 17—18.
2
A similar provision is now contained in 8 U.S.C. § 1251(a)(6)(C), 8 U.S.C.A. § 1251(a)(6)(C).
3
'In determining cases submitted for hearing, special inquiry officers shall exercise * * * the authority contained in section 244 of the Immigration and Nationality Act to suspend deportation.' 8 CFR, Rev.1952, § 242.6.
4
The finding was:
'As the respondent has not been found to have been a Communist Party member later than 1940, it follows that more than ten years has elapsed since the assumption of the status which constitutes the ground for his deportation. Evidence of record, consisting of affidavits of persons well acquainted with the respondent, together with employment records, as well as a report of an investigation by this Service, satisfactorily establishes that he has been physically present in the United States for a continuous period of not less than ten years last past. A check of the local and Federal records reveals no criminal record. An independent character investigation, as well as the above related affidavits tend to establish that for the ten years immediately preceding his application for relief, he has been a person of good moral character.
'* * * He has stated that if he were deported he would suffer extreme and unusual hardship in that he would be separated from relatives and friends, and in effect that he would find it almost impossible to maintain himself because of lack of funds. On the record, respondent appears to be qualified for suspension of deportation.'
5
Section 244(a)(5) of the Act provides in pertinent part that 'the Attorney General may in his discretion suspend deportation' in the case of a deportable alien who (1) has been present in the United States for at least ten years since the ground for his deportation arose; (2) 'proves that during all of such period he has been and is a person of good moral character'; and (3) is one 'whose deportation would, in the opinion of the Attorney General, result in exceptional and extremely unusual hardship.'
6
In his petition for a writ of habeas corpus petitioner alleged, 'Upon information and belief,' that the 'confidential information' considered by the special inquiry officer, and later by the Board of Immigration Appeals, was nothing more than the fact that petitioner's name had appeared on a list circulated by the American Committee for the Protection of the Foreign Born, an organization which had been designated subversive by the Attorney General, ex parte. Petitioner claimed that 'Solely by reason of (his) name appearing on said list, his case for discretionary relief was prejudged and no fair or impartial consideration of his case was given * * *.' In its Return to the Order to Show Cause, the Government denied that the confidential information relied upon was as alleged by petitioner, and denied that the case had been prejudged. The District Court made no specific finding with respect to the character or substance of the confidential information, but it did determine that the special inquiry officer and the Board of Immigration Appeals 'exercised their independent judgment in denying discretionary relief.' See United States ex rel. Accardi v. Shaughnessy, 347 U.S. 260, 74 S.Ct. 499, 98 L.Ed. 681, 349 U.S. 280, 75 S.Ct. 746, 99 L.Ed. 1074; Marcello v. Bonds, 349 U.S. 302, 75 S.Ct. 757.
Petitioner apparently abandoned this allegation and argument in the Court of Appeals. In his petition for a writ of certiorari in this Court, he indirectly raises the point again by claiming to be 'entitled to a judicial hearing upon * * * his allegation of fact in habeas corpus proceedings that the undisclosed and so-called confidential matter * * * was of such a character that its consideration was not authorized by applicable regulations established by the Attorney General.' However, petitioner made no direct assertion in this Court with respect to prejudgment. In this state of the record we conclude that there is no claim of prejudgment before this Court. See n. 22, infra.
7
No further administrative appeal was then available to petitioner. See 8 CFR, Rev.1952, §§ 242.61(e) 6.1(b)(2), 6.1(h)(1).
8
8 CFR, 1952 ed., § 242.6 quoted in part at note 3, supra. Petitioner does not suggest, nor can we conclude, that Congress expected the Attorney General to exercise his discretion in suspension cases personally. There is no doubt but that the discretion was conferred upon him as an administrator in his capacity as such, and that under his rulemaking authority, as a matter of administrative convenience, he could delegate his authority to special inquiry officers with review by the Board of Immigration Appeals. 66 Stat. 173, 8 U.S.C. § 1103, 8 U.S.C.A. § 1103.
9
8 CFR, Rev.1952, § 242.54(d).
10
Ibid.
11
Ibid.
12
8 CFR, Rev.1952, § 242.53(c).
13
8 CFR, Rev.1952, § 242.61(a).
14
See notes 4 and 5, supra, and accompanying text.
15
Congress first provided for suspension of deportation in 1940 by adding a new provision to the Immigration Act of 1917. 54 Stat. 672, as amended, 62 Stat. 1206, 8 U.S.C. (1946 ed., Supp. V) § 155(c). That new provision provided that 'the Attorney General may * * * suspend deportation' under certain circumstances. In enacting the Immigration and Nationality Act of 1952, Congress added the phrase 'in his discretion' after the words 'the Attorney General may.' In an analysis of draft legislation leading up to the 1952 Act, prepared by the Immigration and Naturalization Service for the assistance of the congressional committees, it was stated that the new words were suggested 'in order to indicate clearly that the grant of suspension is entirely discretionary * * *.' That analysis was considered by the congressional committees. See S.Rep. No. 1137, 82d Cong., 2d Sess., p. 3; H.R.Rep. No. 1365, 82d Cong., 2d Sess., p. 28.
16
As stated by Judge Learned Hand, 'The power of the Attorney General to suspend deportation is a dispensing power, like a judge's power to suspend the execution of a sentence, or the President's to pardon a convict.' United States ex rel. Kaloudis v. Shaughnessy, 2 Cir., 180 F.2d 489, 491. See also S.Rep. No. 1137, 82d Cong., 2d Sess., p. 25, for an indication that suspension of deportation is a matter of grace to cover cases of unusual hardship. And see 81 Cong.Rec. 5546, 5553, 5554, 5561, 5569—5570, and 5572, where early proposed legislation for administrative suspension of deportation was variously described as a procedure for 'clemency' and 'amnesty,' and was compared with presidential discretion. And see S.Rep. No. 1515, 81st Cong., 2d Sess., p. 600, emphasizing that suspension of deportation is an entirely discretionary action which does not follow automatically from compliance with the formal eligibility requirements.
17
'* * * if in the opinion of the Board (of Parole) such release is not incompatible with the welfare of society, the Board may in its discretion authorize the release of such prisoner on parole.' (Emphasis supplied.) 18 U.S.C. § 4203, 18 U.S.C.A. § 4203. See United States ex rel. Anderson v. Anderson, 8 Cir., 76 F.2d 375, 376; Losieau v. Hunter, 90 U.S.App.D.C. 85, 193 F.2d 41.
18
A sentencing court 'may suspend * * * sentence and place the defendant on probation' if it is 'satisfied that the ends of justice and the best interest of the public as well as the defendant will be served thereby.' 18 U.S.C. § 3651, 18 U.S.C.A. § 3651.
'The probation service of the court shall make a presentence investigation and report to the court before the imposition of sentence or the granting of probation * * *.' Rule 32(c)(1), Fed.Rules Crim.Proc., 18 U.S.C.A. 'The report of the presentence investigation shall contain any prior criminal record of the defendant and such information about his characteristics, his financial condition and the circumstances affecting his behavior as may be helpful in imposing sentence or in granting probation or in the correctional treatment of the defendant, and such other information as may be required by the Court.' Rule 32(c)(2), Fed.Rules Crim.Proc. 'Before imposing sentence the court shall afford the defendant an opportunity to make a statement in his own behalf and to present any information in mitigation of punishment.' Rule 32(a), Fed.Rules Crim.Proc.
Cf. Williams v. People of State of New York, 337 U.S. 241, 69 S.Ct. 1079, 1085, 93 L.Ed. 1337, where this Court held that there is no constitutional bar for setting a state criminal sentence on the basis of 'out-of-court information.'
19
'If it appears to the Board of Parole from a report by the proper institutional officers or upon application by a prisoner eligible for release on parole, that there is a reasonable probability that such prisoner will live and remain at liberty without violating the laws, and if in the opinion of the Board such release is not incompatible with the welfare of society, the Board may in its discretion authorize the release of such prisoner on parole.' 18 U.S.C. § 4203(a), 18 U.S.C.A. § 4203(a).
Note also that only certain prisoners are eligible for this discretionary relief. 18 U.S.C. § 4202, 18 U.S.C.A. § 4202.
20
See United States ex rel. Knauff v. Shaughnessy, 338 U.S. 537, 70 S.Ct. 309, 94 L.Ed. 317, and Shaughnessy v. United States ex rel. Mezei, 345 U.S. 206, 73 S.Ct. 625, 97 L.Ed. 956, upholding a regulation of the Attorney General to a similar effect which had been promulgated prior to the existence of § 235(c) or any other such specific statutory authority.
21
It is not claimed that a contrary construction would render the statute and regulation unconstitutional, or even that a substantial constitutional question would thereby arise. The thrust of the argument is rather that the statute should be construed liberally in favor of the alien as a matter of statutory interpretation. In any event, in this case we have not violated our normal rule of statutory interpretation that, where possible, constructions giving rise to doubtful constitutional validity should be voided. That rule does not authorize a departure from clear meaning. E.g., United States v. Sullivan, 332 U.S. 689, 693, 68 S.Ct. 331, 334, 92 L.Ed. 297; Hopkins Federal Savings & Loan Ass'n v. Cleary, 296 U.S. 315, 334—335, 56 S.Ct. 235, 239, 240, 80 L.Ed. 51. Moreover, the constitutionality of § 244 as herein interpreted gives us no difficulty. Cf. Williams v. People of State of New York, 337 U.S. 241, 69 S.Ct. 1079, 93 L.Ed. 1337.
22
Petitioner presents the claim that the decision of the special inquiry officer was void in that the 'so-called confidential matter * * * was of such a character that its consideration was not authorized by applicable regulations established by the Attorney General.' See note 6, supra. To the extent that this is an allegation that the undisclosed information, if revealed, would not have been prejudicial to the public interest, petitioner is arguing that the decision violated 8 CFR, Rev.1952, § 244.3. The Board of Immigration Appeals, the District Court, and the Court of Appeals concluded, in effect, that the special inquiry officer found that the disclosure of the information would have been contrary to public interest, safety or security. We accept that finding. Nothing more is required by the regulation.
23
The substance of this regulation is now incorporated in § 235(c) of the Act, 8 U.S.C. § 1225(c), 8 U.S.C.A. § 1225(c). See pp. 10—11, supra.
24
See note 18, supra.
*
Petitioner's only absence from this country since his original entry in 1914 was during World War I to serve in the Armed Forces of our neighbor and ally, the Dominion of Canada.
1
The constitutionality of this Act authorizing deportation for conduct legal when it occurred was sustained in Galvan v. Press, 347 U.S. 522, 74 S.Ct. 737, 98 L.Ed. 911. Mr. Justice Douglas and I dissented. On April 6, 1953, President Eisenhower sent a message to Senator Arthur V. Watkins calling attention to the harshness of the immigration laws which were used here to deport Jay. In listing 'injustices' claimed to exist in the legislation President Eisenhower referred to:
'Deportation provisions that permit an alien to be deported at any time after entry, irrespective of how long ago he was involved, after entry, in an active or (sic) affiliation designated as 'subversive.' Such alien is now subject to deportation even if his prior affiliation was terminated many years ago and he has since conducted himself as a model American.' 99 Cong.Rec. 4321.
2
Included in the testimony for Jay was an affidavit by the Assistant Executive Director for the Seattle Housing Authority which employed him, stating:
'Mr. Jay was rated as one of the most conscientious and faithful employees of this Authority. His honesty was unquestioned. His interest in his work extended beyond the normal working hours and he was always willing to accept additional responsibilities without additional compensation. He was forthright in his opinions. His general moral character is evidenced by the fact that during his entire period of employment not one complaint was ever received from either the tenants or his fellow employees as to his relationships with people.'
3
Hearings before House Subcommittee on Legal and Monetary Affairs of the Committee on Government Operations: Practices and Procedures of the Immigration and Naturalization Service in Deportation Proceedings, 84th Cong., 1st Sess. 18, 67, 138, 207.
4
The fact that Jay is an alien should not mean that he is outside the protection of the Constitution. As Mr. Justice Brewer said in dealing with whether aliens are protected by the first 10 Amendments:
'It is worthy of notice that in them the word 'citizen' is not found. In some of them the descriptive word is 'people,' but in the fifth it is broader, and the word is 'person,' and in the sixth it is the 'accused,' while in the third, seventh, and eighth there is no limitation as to the beneficiaries suggested by any descriptive word.' Fong Yue Ting v. United States, 149 U.S. 698, 739, 13 S.Ct. 1016, 1032, 37 L.Ed. 905 (dissenting).
5
See, e.g., Ludecke v. Watkins, 335 U.S. 160, 68 S.Ct. 1429, 92 L.Ed. 1881; United States ex rel. Knauff v. Shaughnessy, 338 U.S. 537, 70 S.Ct. 309, 94 L.Ed. 317; Shaughnessy v. United States ex rel. Mezei, 345 U.S. 206, 73 S.Ct. 625, 97 L.Ed. 956; Joint Anti-Fascist Refugee Committee v. McGrath, 341 U.S. 123, 71 S.Ct. 624, 94 L.Ed. 817; Carlson v. Landon, 342 U.S. 524, 72 S.Ct. 525, 96 L.Ed. 547.
6
Recently Nikita Khrushchev is reported to have told the 20th Communist Party Congress that Stalin violated: '* * * all existing norms of morality and of Soviet laws.
'Abritrary behavior by one person encouraged and permitted arbitrariness in others. Mass arrests and deportations of many thousands of people, execution without trial and without normal investigation created conditions of insecurity, fear and even desperation.
'* * * honest Communists were slandered, accusations against them were fabricated, and revolutionary legality was gravely undermined.' Department of State Press Release, June 4, 1956, pp. 8—9, 14; Washington Post & Times Herald, June 6, 1956, p. 11, cols. 1, 6.
7
Carlson v. Landon, 342 U.S. 524, 552, 72 S.Ct. 525, 540, 96 L.Ed. 547 (dissenting opinion).
8
9 Harvard Classics 426—428.
9
See United States ex rel. Toth v. Quarles, 350 U.S. 11, 76 S.Ct. 1; In re Oliver, 333 U.S. 257, 68 S.Ct. 499, 92 L.Ed. 682. Cf. Kinsella v. Krueger, 351 U.S. 470, 76 S.Ct. 886; Reid v. Covert, 351 U.S. 487, 76 S.Ct. 880.
10
As Mr. Justice Bradley said for the Court in Boyd v. United States, 116 U.S. 616, 635, 6 S.Ct. 524, 535, 29 L.Ed. 746, '(I)llegitimate and unconstitutional practices get their first footing in that way, namely, by silent approaches and slight deviations from legal modes of procedure. This can only be obviated by adhering to the rule that constitutional provisions for the security of person and property should be liberally construed. A close and literal construction deprives them of half their efficacy, and leads to gradual depreciation of the right, as if it consisted more in sound than in substance. It is the duty of courts to be watchful for the constitutional rights of the citizen, and against any stealthy encroachments thereon. * * *' See also dissenting opinion of Mr. Justice Brewer in Fong Yue Ting v. United States, 149 U.S. 698, 744, 13 S.Ct. 1016, 1034, 37 L.Ed. 905.
11
See Shaughnessy v. United States ex rel. Accardi, 349 U.S. 280, 290—293, 75 S.Ct. 746, 751, 752, 99 L.Ed. 1074 (dissenting); United States ex rel. Toth v. Quarles, 350 U.S. 11, 17, 76 S.Ct. 1, 5.
12
The destruction of judicial protections for fair and open determinations of guilt is an essential to maintenance of dictatorships. After the murderous purge of hundreds of German citizens Hitler said:
'If anyone reproaches me and asks why I did not resort to the regular courts of justice for conviction of the offenders, then all that I can say to him is this: in this hour I was responsible for the fate of the German people, and thereby I became the supreme Justiciar of the German people!
'* * * If people bring against me the objection that only a judicial procedure could precisely weigh the measure of the guilt and of its expiation, then against this view I lodge my most solemn protest. He who rises against Germany is a traitor to his country: and the traitor to his country is not to be punished according to the range and the extent of his act, but according to the purpose which that act has revealed.' Speech delivered by Hitler in the Reichstag on 13 July 1934, 1 Hitler's Speeches (Baynes ed. 1942), 321—323.
The Russian purges of the 1930's are reported to have been governed by a directive initiated by Stalin, which stated:
'I. Investigative agencies are directed to speed up the cases of those accused of the preparation or execution of acts of terror.
'II. Judicial organs are directed not to hold up the execution of death sentences pertaining to crimes of this category in order to consider the possibility of pardon, because the Presidium of the Central Executive Committee USSR does not consider as possible the receiving of petitioners of this sort.
'III. The organs of the Commissariat of Internal Affairs are directed to execute the death sentences against criminals of the above-mentioned category immediately after the passage of sentences.' Department of State Press Release, June 4, 1956, p. 15; Washington Post & Times Herald, June 6, 1956, p. 11, cols. 7 8.
1
The entire statement made at the B'Nai B'Rith Dinner in Washington, D.C., November 23, 1953, reads as follows:
'Why are we proud? We are proud, first of all, because from the beginning of this Nation, a man can walk upright, no matter who he is, or who she is. He can walk upright and meet his friend or his enemy; and he does not feel that because that enemy may be in a position of great power that he can be suddenly thrown in jail to rot there without charges and with no recourse to justice. We have the habeas corpus act, and we respect it.
'I was raised in a little town of which most of you have never heard. But in the West it is a famous place. It is called Abilene, Kansas. We had as our Marshal for a long time a man named Wild Bill Hickok. If you don't know anything about him, read your Westerns more. Now that town had a code, and I was raised as a boy to prize that code.
'It was: meet anyone face to face with whom you disagree. You could not sneak up on him from behind, or do any damage to him, without suffering the penalty of an outraged citizenry. If you met him face to face and took the same risks he did, you could get away with almost anything, as long as the bullet was in the front.
'And today, although none of you has the great fortune, I think, of being from Abilene, Kansas, you live after all by that same code, in your ideals and in the respect you give to certain qualities. In this country, if someone dislikes you, or accuses you, he must come up in front. He cannot hide behind the shadow. He cannot assassinate you or your character from behind, without suffering the penalties an outraged citizenry will impose.'
2
Address before New York Civil Liberties Union, New York City, February 22, 1956.
| 12
|
351 U.S. 454
76 S.Ct. 965
100 L.Ed. 1331
UNITED STATES of America ex rel. David DARCY, Petitioner,v.Earl H. HANDY, Warden of Bucks County Prison, et al.
No. 323.
Argued May 1 and 2, 1956.
Decided June 11, 1956.
Mr.Charles J. Margiotti, Pittsburgh, Pa., for petitioner (on appeal only).
Mr. Frank P. Lawley, Jr., Harrisburg, Pa., for respondent.
Mr. Justice BURTON delivered the opinion of the Court.
1
The question before us is whether the accused, who is under a sentence of death, imposed by a Pennsylvania court and jury for murder committed during the course of an armed robbery, was tried under such prejudicial circumstances and improper influences that he was denied the due process of law guaranteed by the Fourteenth Amendment to the Constitution of the United States. The charges in this federal habeas corpus proceeding are that an atmosphere of hysteria and prejudice prevailed at the state trial, including the prejudicial conduct and frequent presence in the courtroom of another judge of the same court, who recently had presided over a trial of two associates of petitioner and which had resulted in a like conviction and sentence for the murder committed. For the reasons hereafter stated, we agree with the considered judgments of the state court, Commonwealth of Pennsylvania ex rel. Darcy v. Claudy, 367 Pa. 130, 79 A.2d 785; the Federal District Court, 130 F.Supp. 270; and the Court of Appeals, 224 F.2d 504; holding that the accused was not denied due process of law.
2
Late on December 22, 1947, petitioner Darcy and three associates, Foster Zeitz and Capone, armed with revolves, held up a tavern in Feasterville, near Doylestown, Bucks County, Pennsylvania.1 During the robbery two patrons of the tavern were shot and severely wounded. As petitioner and his companions left the scene, Zeitz fired at and killed a bystander, William Kelly. About a half hour later, petitioner and his companions committed another armed robbery in which shots also were fired but no one was injured. Before 2 a.m., they were arrested by Philadelphia police. While in that custody, they voluntarily admitted their participation not only in the above robberies but in seven others committed since November 30. In these a total of seven persons had been shot or otherwise injured.
3
On January 5, 1948, petitioner and his three companions were brought to Bucks County, charged with the murder of William Kelly and committed, without bail, to await action by the grand jury. On February 10, all four being present and all but one being represented by counsel of his own choice, they were severally indicted for murder. The District Attorney moved for a continuance because Foster was without counsel, and because one prosecution witness was in a critical condition from the wound received at the time of the robbery. The continuance was granted. On March 1, counsel for petitioner and Capone moved for a severance and separate trials. Judge Keller of the nisi prius or trial court (Court of Oyer and Terminer and General Jail Delivery of Bucks County) suggested the advisability of a combination trial, but granted the motions when counsel insisted on their right to them. On March 3, Judge Boyer, of the same court, appointed two local attorneys to represent Foster.
4
In March, defense counsel were advised that the Foster-Zeitz case would be called first, petitioner's case the following week, and then Capone's case.
5
When it became apparent that the Foster-Zeitz trial, which began May 24, would continue into the week of June 1, the court directed the sheriff's office to notify the prospective jurors who had been summoned for June 1 not to appear until June 7. They were so notified and with one exception, did not appear for duty until the latter date. For the Foster-Zeitz and petitioner's trials, the prospective jurors waited outside the main courtroom, were called in individually and were subjected to a searching examination on voir dire. While neither Foster, Zeitz nor petitioner exercised all of his peremptory challenges, two extra venires were called in order to complete the two juries. No jurors sat in both cases. Once accepted, the respective juries were kept together during each trial under the supervision of court officials. The jurors were not permitted to see newspapers, listen to radios, or see television programs, and were kept free from any outside influence or contact.
6
At no time during either the Foster-Zeitz trial or petitioner's trial was the courtroom filled to capacity and at no time was there any need for the court to call for order. No outbursts, disturbances or untoward incidents occurred in the courtroom or elsewhere in the county.2 The proceedings were reported daily in the press and, on occasion, by radio. The reporting was factual, with some editorials.3 The news coverage diminished a few weeks after the robbery, increased and subsided again after the grand-jury proceedings, and increased just before the trials.
7
In Pennsylvania, the jury fixes the penalty for murder in the first degree.4 No question was raised as to identity or as to petitioner's participation in the robbery. The strategy of the defense in both trials was to seek to keep the punishment down to life imprisonment. On Friday, June 4, the jury in the Foster-Zeitz trial returned a verdict of guilty and fixed the penalty at death. After receiving the verdict, the trial judge, Judge Boyer, was, on June 5, quoted in the local newspaper as having said to that jury:
8
'I don't see how you could, under the evidence, have reached any other verdict. Your verdict may have a very wholesome effect on other young men in all vicinities who may come to realize the seriousness of the folly in which so many young men indulge in these days. The only hope of stemming the tide of such crime by youth is to enforce the law which you have indicated by your decision." 130 F.Supp. at pages 291—292.
9
A few moments earlier, Judge Keller, in discharging the remainder of the May 24 panel, had, in the same courtroom, commended them for their satisfactory verdicts, the last one of which had been an acquittal on a charge of rape.
10
On Monday, June 7, petitioner's trial began. The court opened at 10 a.m., with both Judge Boyer and Judge Keller presiding. As usual, miscellaneous business unrelated to the impending trial, was first dispused of by the court. Petitioner was then arraigned. He pleaded not guilty and, upon Judge Keller's direction, the selection of the jury was commenced. At various times during petitioner's trial, although it was presided over by Judge Keller, Judge Boyer was in attendance, sitting either on the bench with Judge Keller or in the courtroom within the enclosure reserved for attorneys, the parties and the press. In this connection, the Federal District Court found that—
11
'By long established tradition in Bucks County, each morning and afternoon at the opening of court both judges take the bench to entertain motions and other miscellaneous matters in the Criminal, Common Pleas—law and equity—and Orphans Court. Once this work is completed, one of the judges, if engaged in a trial in that court room, remains on the bench; the other judge leaving to perform duties in another court room or in chambers. The practice used in many Pennsylvania courts * * * was continued daily no matter what court was in session or the nature of the trial * * * (but) not on June 4 when Judge Boyer charged the jury (trying Foster and Zeitz); and * * * not on June 8 and 10.
12
'The criminal docket * * * a record of individual trials, shows both judges on the bench at 10:00 A.M. May 24 * * * 9:30 A.M. June 2 * * * 10:00 A.M. June 7 * * *. The court reporter's notes of testimony show only one instance of Judge Boyer taking any part whatsoever in the Darcy trial, i.e., during a sidebar discussion out of the hearing of the jury shortly after court convened on Saturday morning, June 12 * * *. Under consideration was a difficult question of law on the admissibility of evidence of other offenses * * * in view of the Act of July 3, 1947, P.L. 1239, 19 P.S.Pa. § 711 note. Judge Boyer indicated his thinking on the matter. Upon objection by counsel the discussion ended; Judge Keller ruled; Judge Boyer left the bench shortly after and did not return during the remainder of the trial. It may be that during the Foster-Zeitz trial Judge Keller shortly after 9:30 A.M. June 2 * * * listened to but did not express any opinion during a similar discussion.
13
'Honorable Hiram H. Keller * * * who presided * * * throughout the trial, has certified * * * that after the miscellaneous business was completed, 'On several occasions * * * Judge Boyer remained for brief periods while evidence was presented * * *', and that with the exception of the incident (noted above), 'At no other time, during the course of the trial, did Judge Boyer assist, volunteer to assist, or make any suggestions to or otherwise aid the undersigned in the trial of this case.'
14
'The District Attorney * * * testified, and we find as a fact, that Judge Boyer did not at any time during the Darcy trial assist, attempt to assist, make any suggestion to or in any other manner aid the Commonwealth in the prosecution of the case against David Darcy; that Judge Boyer did not pass any note or message of any kind to the District Attorney in connection with the trial for the use of the District Attorney or Judge Keller.
15
'On several occasions during the Darcy trial—not on Friday evening or during the charge of the court on Monday, June 14 Judge Boyer sat for brief intervals on a chair just inside the court room door from the judges' chambers, apparently listening to the proceedings. * * *
16
'During the Darcy trial Judge Boyer did not at any time sit at or near the table reserved for the press; at or near the table reserved for the District Attorney; at no time did Judge Boyer sit on a chair next to or anywhere near a chair occupied by the District Attorney.
17
'Throughout the trial, the only chairs occupied by the District Attorney or his assistant were at the table reserved for that purpose, or in chairs immediately in front of the table reserved for the press.
18
'At no time other than that noted (above) did Judge Boyer take any part whatsoever in the proceedings of the Darcy trial.' 130 F.Supp. at pages 296—297.
19
On Monday, June 14, petitioner's case went to the jury. It returned a verdict of guilty and fixed the penalty at death. The subsequent proceedings in this case, extending over eight years, are summarized in the margin.5 Those proceedings uniformly sustained the State, but we granted certiorari to review the charge now made by petitioner that he was denied due process. 350 U.S. 872, 76 S.Ct. 115.
20
Petitioner's charge is that (a) the news coverage of the robbery and of the proceedings prior to his trial, including the Foster-Zeitz trial and Judge Boyer's reported remarks to the jury in that case, created such an atmosphere of hysteria and prejudice that it prevented him from having a fair trial, (b) notwithstanding that he was granted a severance, he was forced to go to trial within one week of the trial of his companions, Foster and Zeitz, and (c) in the light of (a) and (b) above, Judge Boyer's presence and participation in petitioner's trial prevented him from being fairly tried since Judge Boyer, in effect, acted as an 'overseer judge' and effectively guided and influenced petitioner's jury.
21
Petitioner has been given ample opportunity to prove that he has been denied due process of law. While this Court stands ready to correct violations of constitutional rights, it also holds that 'it is not asking too much that the burden of showing essential unfairness be sustained by him who claims such injustice and seeks to have the result set aside, and that it be sustained not as a matter of speculation but as a demonstrable reality.' Adams v. United States ex rel. McCann, 317 U.S. 269, 281, 63 S.Ct. 236, 242, 87 L.Ed. 268. See also, Buchalter v. People of State of New York, 319 U.S. 427, 431, 63 S.Ct. 1129, 1131, 87 L.Ed. 1492; Stroble v. State of California, 343 U.S. 181, 198, 72 S.Ct. 599, 607, 96 L.Ed. 872. Justice Holmes, speaking for a unanimous Court in Holt v. United States, 218 U.S. 245, 251, 31 S.Ct. 2, 6, 54 L.Ed. 1021, cautioned that 'If the mere opportunity for prejudice or corruption is to raise a presumption that they exist, it will be hard to maintain jury trial under the conditions of the present day.'
22
We have examined petitioner's allegations, the testimony and documentary evidence in support thereof, and his arguments. We conclude that the most that has been shown is that, in certain respects, opportunity for prejudice existed. From this we are asked to infer that petitioner was prejudiced. The law recognizes that prejudice may infect any trial and provides protection against it. For example, provision is made for the voir dire examination and for challenges of jurors who indicate that they may be prejudiced. In addition, a substantial number of peremptory challenges is allowed. This gives to each party a large discretion to exclude jurors deemed objectionable for any reason or no reason. Another protection is available through the severance of the trials of the defendants and through continuances of the respective trials. Still another means of protection is that of a change of venue for proper cause.
23
In the instant case, notwithstanding the fact that competent counsel for petitioner did not use all of his peremptory challenges after a searching examination of prospective jurors on voir dire, and did not seek a continuance of the trial or a change of venue, petitioner asks this Court, in effect, to infer that the news coverage of the robbery and proceedings prior to petitioner's trial, including the Foster-Zeitz trial, created such an atmosphere of prejudice and hysteria that it was impossible to draw a fair and impartial jury from the community or to hold a fair trial. The failure of petitioner's counsel to exhaust the means provided to prevent the drawing of an unfair trial jury from a community allegedly infected with hysteria and prejudice against petitioner, while not dispositive, is significant.6 Here, the issue was not raised until almost three years after the trial, yet we are asked to read the news reports and the testimony as to other incidents and to find, contrary to the Supreme Court of Pennsylvania and two federal courts, that these reports and incidents did create such an atmosphere that it infected the jurors and deprived petitioner of a fair trial on the evidence presented to them. We see no justification in the record to warrant our so finding.
24
On the other hand, the Federal District Court, familiar with the local conditions, has found, on the evidence before it, that petitioner's trial was conducted in a calm judicial manner, without any disturbances, and that the news coverage was 'factual, with an occasional descriptive word or phrase, and, on occasion, words of compassion or commendation.' 130 F.Supp. at page 286. It has found that counsel for petitioner conducted a thorough voir dire examination. In all, 49 persons were challenged for cause or excused—14 for fixed opinion or bias. Petitioner used 10 of the 20 peremptory challenges allowed him, the Commonwealth only eight. The record shows that counsel for petitioner was informed almost three months before petitioner's trial that petitioner would be tried immediately after Foster and Zeitz, but he made no motion for a continuance7 or for a change of venue. Of the prospective jurors called for service at petitioner's trial, only one was found to have attended the Foster-Zeitz trial and that person was challenged for cause. There is nothing in the record to show, as a 'demonstrable reality,' that petitioner was denied due process of law because of community hysteria and prejudice. The District Court's findings, sustained by the Court of Appeals and supported by the record, dispose of this aspect of the case.
25
Nor do we conclude that petitioner was prevented from obtaining a fair jury trial by reason of Judge Boyer's commendatory remarks to the Foster-Zeitz trial jury, reported in the local press two days before petitioner's trial. At most, petitioner has shown that this created a possible opportunity for prejudice. There is no merit in petitioner's claim that he was 'forced' to trial immediately after the Foster-Zeitz trial or in his claim that the trial judge should have, sua sponte, changed the venue or continued the trial. See 130 F.Supp. at pages 292 295.
26
Petitioner's remaining claim rests largely upon facts which the District Court has found against him. Petitioner alleges that, during the charge to the jury, Judge Boyer passed a note to the District Attorney, who immediately interposed an objection to Judge Keller's charge, and the latter allegedly corrected himself. Petitioner argues that the testimony of the District Attorney and his assistant that they had no recollection of such an incident is insufficient to offset the direct testimony of petitioner's witnesses that the incident did occur, that Judge Boyer did sit at the table reserved for the press, and that the District Attorney and his assistant sat immediately in front of Judge Boyer. The issue thus raised is largely one of credibility to be determined by the trier of the facts. Hawk v. Olson, 326 U.S. 271, 279, 66 S.Ct. 116, 120, 90 L.Ed. 61. The District Court's positive findings on this aspect of the case (76 S.Ct. at page 968, supra) find support in the record. We are not justified in upsetting them.
27
We also are asked to find that the presence of Judge Boyer on the bench at the beginning of each session of the court, his remaining on the bench after the miscellaneous business was disposed of, and his presence thereafter in the courtroom created such a prejudicial effect upon the jury that it became impossible for it to return a fair verdict and penalty. Except for the one incident where Judge Boyer participated in a sidebar conference out of the hearing of the jury,8 the District Court found that he did not participate in petitioner's trial. Petitioner's counsel objected to Judge Boyer's participation in the sidebar conference9 and he left the bench shortly thereafter.
28
Petitioner makes much of the fact that the majority opinion of the Court of Appeals states that Judge Boyer's conduct showed a 'striking manifestation of extraordinary interest in the proceedings,' and that the jury knew who he was and it was 'very probable' they knew that he had just completed the Foster-Zeitz trial. 224 F.2d at page 508. We agree with the Court of Appeals that petitioner attaches too much significance to Judge Boyer's conduct. Judge Boyer's presence on the bench, particularly in the light of the long-established practice for both judges to sit on the bench at the beginning of each session to dispose of miscellaneous business, did not amount to a denial of due process. Nor did his subsequent presence on the bench or in the courtroom make out a denial of due process. Under the cases cited earlier,10 petitioner must show that he was prejudiced in some way by the judge's presence. Aside from the sidebar conference and the contested note-passing incident, petitioner relies upon Judge Boyer's statement to the Foster-Zeitz jury and his subsequent remarks made on June 11, in another case, in sentencing another Philadelphia youth, to show that Judge Boyer was 'hostile' to petitioner and that the jury recognized such hostility. But the remarks on June 11 could not have prejudiced petitioner's jury since that jury had no access to any source of news that reported the incident. Petitioner, thus, is left with Judge Boyer's commendatory remark to the Foster-Zeitz trial jury. This, read in its proper context and examined in the light of Judge Keller's remarks made to the remainder of the jury panel, does not raise a substantial due process question. Petitioner seeks to have this Court speculate that the jurors knew that Judge Boyer had made this statement and that they were prejudiced by it or by Judge Boyer's presence. We can no more speculate on this aspect of the case than on the others. Petitioner's counsel must have been aware of Judge Boyer's statement and of its possible effect, if any, on the jury, and the possible effect of Judge Boyer's manifestation of interest. However, he took no action to prevent this possibility from infecting petitioner's trial. Accordingly, we may as well speculate that he did not deem it necessary to take any such action because the possibility of prejudice was too remote to justify it. It is not necessary for this Court to enter into such speculations. Petitioner has not sustained the burden resting upon him to show that his trial was essentially unfair in a constitutional sense and that the several courts which have reviewed it are all in error. The judgment of the Court of Appeals, therefore, is affirmed.
29
Affirmed.
30
Mr. Justice HARLAN, whom Mr. Justice FRANKFURTER and Mr. Justice DOUGLAS join, dissenting.
31
I would reverse the judgment below on the basis of Judge Boyer's conduct. The central facts against which this conduct must be viewed are that: (1) Zeitz, not petitioner, did the actual killing on which petitioner's trial was based, and (2) petitioner's participation in the robbery being uncontested, the only real issue at his trial was whether he should suffer the death penalty or life imprisonment which, under the Pennsylvania statute, was a question for the jury. If these facts be kept in mind, I think that the Court, in holding that the case presents no violation of due process, has disposed of Judge Boyer's conduct too lightly.
32
The Court states that the general atmosphere of the trial was not prejudicial, that Judge Boyer's remarks to the Foster-Zeitz jury raise no substantial due process questions, and that we should not disturb the District Court's findings that the alleged note-passing incident did not occur and that Judge Boyer's participation in the trial was limited to the 'sidebar' episode. Accepting this, as I do, it does not end the matter for me, for there still remain these undisputed facts, and the inferences which I think should be drawn from them: The crime was a particularly antrocious one, and Judge Boyer shared the community sense of outrage over it.1 The trial took place in a small rural community of which Judge Boyer had been a respected member for many years, and he was presumably known to the jurors, at least by reputation. Judge Boyer, as it is fair to assume the jurors knew, had presided over the Foster-Zeitz trial in which the jury, three days before petitioner's trial bagan, had returned a death verdict against two of petitioner's associates in this crime.2 Judge Boyer remained in the courtroom at petitioner's trial beyond the call of duty, and his presence there on some days after other matters had been disposed of was wholly unexplained. On such occasions he sat not with the ordinary spectators, but sometimes on the bench and other times within the bar in full view of the jury. The 'sidebar' conference, in which Judge Boyer participated, was in sight of the jury. Judge Boyer was in the courtroom during the court's charge. From these admitted facts, I consider that the jury must have been conscious of the unusual interest which Judge Boyer had in the case, and that it might well have concluded that he felt the defendant should be dealt with severely.
33
Having regard to the character of the issue with which the jury was confronted. I think these undisputed facts, and the inferences which may be drawn from them, require us to hold that the petitioner has been denied due process. I cannot say that the support lent to the prosecution by Judge Boyer's manifest interest in the trial might not have tipped the scales with the jury in favor of a death verdict, and in a capital case I would resolve that doubt in favor of a new trial. The reasons for my conclusion are those which Judge Kalodner has well stated in his dissenting opinion in the Court of Appeals, 224 F.2d 504, 509. We should be especially scrupulous in seeing to it that the right to a fair trial has not been jeopardized by the conduct of a member of the judiciary.
1
This statement of facts and review of the relevant procedural steps in the case are taken largely from the opinion rendered in the instant case by the two judges constituting the United States District Court for the Middle District of Pennsylvania. 130 F.Supp. 270. They conducted a full hearing on the petition for habeas corpus. It lasted eight days. More than 30 witnesses testified and much documentary evidence was introduced.
2
130 F.Supp. at pages 283—285, note 39—42.
3
130 F.Supp. at pages 285—289, note 43—47.
4
Purdon's Pa.Stat.Ann., 1945, Tit. 18, § 4701.
5
Motion for new trial, denied; appeal to the Pennsylvania Supreme Court, conviction affirmed, Commonwealth of Pennsylvania v. Darcy, 362 Pa. 259, 66 A.2d 663; petition for habeas corpus to the Pennsylvania Supreme Court, denied, without opinion; petition for certiorari to review those judgments, denied, 338 U.S. 862, 70 S.Ct. 96, 94 L.Ed. 528; applications to the Pennsylvania Board of Pardons for commutation of sentence, denied; second petition for habeas corpus to the Pennsylvania Supreme Court filed April 2, 1951, raising for the first time the constitutional questions now before us; on the same day, a similar petition for habeas corpus filed in the United States District Court for the Middle District of Pennsylvania; second petition for habeas corpus to the Pennsylvania Supreme Court, denied, Commonwealth of Pennsylvania ex rel. Darcy v. Claudy, 367 Pa. 130, 79 A.2d 785 (after passing on the merits of the petition); petition to the United States District Court, dismissed, United States ex rel. Darcy v. Handy, D.C., 97 F.Supp. 930; petition for certiorari to review the Pennsylvania Supreme Court's denial of the writ of habeas corpus, denied, Commonwealth of Pennsylvania ex rel. Darcy v. Claudy, 342 U.S. 837, 72 S.Ct. 61, 96 L.Ed. 632; appeal to the United States Court of Appeals for the Third Circuit from the District Court's dismissal of the petition for habeas corpus, heard en banc, reversed by a divided court and remanded for hearing, United States ex rel. Darcy v. Handy, D.C., 203 F.2d 407; after rehearing denied by the Third Circuit, the State sought certiorari in this Court, denied, Maroney v. United States ex rel. Darcy, 346 U.S. 865, 74 S.Ct. 103, 98 L.Ed. 375, after hearing before Chief Judge Watson and District Judge Murphy, of the District Court, petition for habeas corpus denied, United States ex rel. Darcy v. Handy, D.C., 130 F.Supp. 270; on appeal to the Third Circuit, heard en banc, the District Court's judgment was affirmed, 4—3, United States ex rel. Darcy v. Handy, D.C., 224 F.2d 504. Throughout these proceedings, petitioner has been represented by competent counsel.
6
See Stroble v. State of California, 343 U.S. 181, 193—194, 72 S.Ct. 599, 605, 96 L.Ed. 872.
7
Counsel for Capone sought and was granted a continuance on May 17, 1948, one week prior to the Foster-Zeitz trial.
8
The ruling made following this incident was in favor of petitioner, since the statements of prior offenses then before the court were admitted for a purpose more limited than the Pennsylvania Supreme Court approved on appeal. See Commonwealth of Pennsylvania v. Darcy, 362 Pa. 259, 283, 66 A.2d 663, 675.
9
The ground for this objection was that Judge Boyer had 'disqualified himself from sitting in on this case, and it is prejudicial to the defendant (petitioner).' See 130 F.Supp. at page 296, note 54.
10
See cases cited at 8, supra.
1
In imposing sentence in a case tried during petitioner's trial, Judge Boyer said (as reported by a local newspaper the next day):
'We don't propose to nail all our property fast here in Bucks county just because thieves from Philadelphia want to pick up everything which isn't being watched. * * * What business did you have to come up here in the first place? * * * Have you heard what's going on downstairs (referring to petitioner's trial)? * * * Do you want to wind up like that? * * * We in Bucks county are tired of you Philadelphians who don't know how to behave. We have to bear the expense and we propose to stop it.'
Since petitioner's jury had no access to this newspaper, these statements could not have affected his trial. But they are indicative of Judge Boyer's sentiments, and of community reaction.
2
The local newspaper reported the following on the day after the Foster-Zeitz trial ended:
'JUDGE BOYER PRAISES JURY FOR VERDICT CONDEMNING 2 KILLERS TO ELECTRIC CHAIR
"I don't see how you could, under the evidence, have reached any other verdict,' Judge Boyer said.
"Your verdict may have a very wholesome effect on other young men in all vicinities who may come to realize the seriousness of the folly in which so many young men indulge these days.
"The only hope of stemming the tide of such crime by youth is to enforce the law which you have indicated by your decision,' Judge Boyer said.'
| 01
|
352 U.S. 1
77 S.Ct. 1
1 L.Ed.2d 1
Stephen MESAROSH, also known as Steve Nelson, et al., Petitioners,v.UNITED STATES of America.
No. 20.
Argued Oct. 10, 1956.
Decided Nov. 5, 1956.
Mr. Solicitor General Rankin in support of the motion to remand.
Mr. Frank J. Donner in opposition thereto.
On Motion to Remand.
November 5, 1956.
PER CURIAM.
1
The motion of the Government to remand the case to the District Court is denied.
2
The judgment is vacated and the case is remanded to the District Court with instructions to grant the defendants a new trial.
3
Dissenting opinion.
4
Mr. Chief Justice WARREN delivered the opinion of the Court.
5
The decision herein passes only on the integrity of a criminal trial in the federal courts. It does not determine the guilt or innocence of the petitioners, and we do not reach other issues propounded in the lengthy briefs or which may be present in the trial record of 5,147 pages. The Solicitor General of the United States moved to remand the case to the trial court for further proceedings because of untruthful testimony given before other tribunals by Joseph D. Mazzei, a Government witness in this case. The counter-motion of petitioners asked for a new trial. The decision is based entirely upon the representations of the Government in its written motion and on the statements of the Solicitor General during the argument on the motions.1
6
The petitioners were charged in a one-count indictment in the District Court for the Western District of Pennsylvania with conspiracy to violate the Smith Act, 18 U.S.C.A. § 2385.2 They were convicted, and the Court of Appeals for the Third Circuit, sitting en banc, affirmed by a divided court. 223 F.2d 449. This Court granted the petition for writ of certiorari, 350 U.S. 922, 76 S.Ct. 218, and the case was scheduled for argument on October 10, 1956.
7
On September 27, 1956, the Solicitor General of the United States filed a motion calling the attention of the Court to the testimony given in other proceedings by Mazzei, who was one of the seven witnesses for the Government in this case. In his motion, he stated that the Government, on the information in its possession, now has serious reason to doubt the truthfulness of Mazzei's testimony in those proceedings. While adhering to its position that 'the testimony given by Mazzei at the trial (in this case) was entirely truthful and credible,' the motion stated that 'these incidents, taken cumulatively, lead us to suggest that the issue of his truthfulness at the trial of these petitioners should now be determined by the District Court after a hearing.'
8
The material cited by the Government indicating the untruthfulness of Mazzei on occasions other than this trial can best be presented by setting forth verbatim the description of these incidents presented in the Motion of the Government to Remand:
9
'On June 18, 1953, Mazzei testified before the Senate Permanent Subcommittee on Investigations, in Washington, D.C., that, at a meeting of the Civil Rights Congress on December 4, 1952, one Louis Bortz told him that he, Bortz, had been 'selected by the Communist Party to do a job in the liquidation of Senator Joseph McCarthy.' Mazzei further testified that the said Bortz conducted Communist Party classes in Pittsburgh to familiarize Party members with the handling of firearms and to instruct them in the construction of bombs.
10
'On November 14, 1952, Mazzei pleaded guilty to charges of adultery and bastardy in a Pennsylvania state court. This fact was brought out during his cross-examination at the petitioners' trial. On October 2, 1953—after the completion of the trial—Mazzei filed a petition in the state court to have the guilty plea set aside. One of the grounds set forth in his petition was that he 'was not guilty of the charge to which he was induced to plead * * * but did so only in his official capacity (as a Government informant) at the insistence of his superior in the FBI to avoid testifying.' At a hearing on the above petition on October 6, 1953, a Special Agent of the FBI denied Mazzei's allegations under oath. Mazzei's petition was dismissed by the court on October 6, 1953.
11
'In November 1953, Mazzei, at a secret proceeding, identified a certain Government official as a long-time active Communist Party member.
12
'On June 10 and 11, 1955, Mazzei testified before the Senate Subcommittee on Internal Security regarding possible Communist influences motivating attempts to discredit Justice Michael Musmanno of the Supreme Court of Pennsylvania. In the course of his testimony, Mazzei identified John J. Mullen, National Director, Political Action Committee, Steel Workers of America, as a member of the Communist Party in Pittsburgh during the period that Mazzei was a Government informant. Mazzei also testified that since 1942 he met Mullen ten or fifteen times a year, as a fellow Communist Party member.
13
'On July 2, 1956, Mazzei testified in disbarment proceedings against one Leo Sheiner before the Circuit Court of the Eleventh Judicial Circuit of Florida, in Miami. On cross-examination, Mazzei reiterated his charge that he was induced to plead guilty to the adultery and bastardy charge in the Pennsylvania state court in November 1952 by an Agent of the FBI. Items of his testimony as to alleged Communist activity are as follows:—that he visited Dade County, Florida, on behalf of the Communist Party during each of the years from 1946 to 1952; that the Communist Party in Miami had attempted to lease a bus line which served the Opa-locka Air Base; that in 1948 the Communist Party made plans for the armed invasion of the United States on orders from the Soviet Union and that he, Mazzei, was selected to go to Miami in 1948 because it was a seaport; that he took courses in the Communist Party on sabotage, espionage, and handling arms and ammunition; that he was taught by officers of the Communist Party in Pittsburgh how to blow bridges, poison water in reservoirs, and to eliminate people; that he discussed with Sheiner in 1948 'knocking off' a Judge Holt (a Florida judge) whom they (presumably the Communist Party) were having trouble with, and importing one Louis Bortz, the strong-arm man for the Communist Party, to do the job; that he and the Communist Party had made plans to assassinate Senators, Congressmen, and even went to Washington and beat up a Senator; and that, to his knowledge, Sheiner was extensively engaged in Communist Party activities in 1945, 1947, 1950, 1951, and 1952.
14
None of this testimony at the Florida proceeding is supported or corroborated by information in the possession of the Government.
15
'Mazzei likewise testified that the FBI arranged to get him into the Army so that he could watch a certain Communist Party member; that he never wore a uniform and that he was discharged the day after the Communist Party member he was to watch was discharged. In actual fact, Mazzei's career in the Army was the result of the operation of the Selective Training and Service Act of 1940 and the FBI had nothing to do with his service in the armed forces. He also testified that sometimes the FBI paid him about $1,000 a month for expenses. From the period 1942 to 1952, according to the Bureau records, Mazzei was paid the total of $172.05 as expense money.
16
'Mazzei likewise testified that he had never been arrested in his life. In fact, he was arrested in connection with the paternity case brought against him in Pennsylvania by one Irene Corva. He has been arrested several times subsequent to this for his failure to make support payments to this woman.'
17
On the argument of the motion the Solicitor General, in response to questions by the Court, stated with commendable candor that he believed the testimony given by Mazzei on June 18, 1953, before the Senate Committee concerning 'the liquidation of Senator Joseph McCarthy' was untrue. He likewise stated that he believed the testimony given by Mazzei on July 2, 1956, in the Circuit Court of Florida was untrue. And in addition to the Solicitor General's personal opinion, the text of the motion itself shows that the Department of Justice is certain that some of Mazzei's post-trial testimony was contrary to the facts. The Pennsylvania statement of October 2, 1953, concerning his conviction of adultery and bastardy was controverted under oath at that hearing by an agent of the FBI. Mazzei again asserted in the Florida proceeding that he was induced to plead guilty to the adultery charge by an agent of the FBI. In the Florida testimony, he said that the FBI sometimes paid him a thousand dollars a month for expenses, whereas the records of the Bureau showed he was paid a total of $172.05 as expense money. He also testified there that the FBI arranged to put him in the Army to spy on a Party member, whereas the FBI had nothing to do with his Army service; he had been inducted in accordance with the Selective Service Act. All these discrepancies are pointed out in the motion, as quoted above
18
As to his bizarre testimony in the Florida proceeding concerning sabotage, espionage, handling of arms and ammunition, and plots to assassinate Senators, Congressmen, and a state judge, the Government's motion suggests that none of it is worthy of belief by stating therein: 'None of this testimony at the Florida proceeding is supported or corroborated by information in the possession of the Government.'
19
At the oral argument, however, the Solicitor General stated that although he believed all of this testimony to be untrue, he was not prepared to say the witness Mazzei was guilty of perjury in giving the testimony; that his untrue statements might have been caused by a psychiatric condition, and that such condition might have arisen subsequent to the time of this trial. The Solicitor General, in the light of this position, asked to have the argument on the main case stricken from the calendar and the case remanded to the District Court for a full consideration of the credibility of the testimony of witness Mazzei. Commendable as the action of the Solicitor General was in promptly bringing the matter to our attention when it came to the attention of his office,3 we do not believe the disposition of the case suggested by him should be made.
20
Either this Court or the District Court should accept the statements of the Solicitor General as indicating the unreliability of this Government witness. The question of whether his untruthfulness in these other proceedings constituted perjury or was caused by a psychiatric condition can make no material difference here. Whichever explanation might be found to be correct in this regard, Mazzei's credibility has been wholly discredited by the disclosures of the Solicitor General. No other conclusion is possible. The dignity of the United States Government will not permit the conviction of any person on tainted testimony. This conviction is tainted, and there can be no other just result than to accord petitioners a new trial.
21
It must be remembered that we are not dealing here with a motion for a new trial initiated by the defense, under Rule 33 of the Federal Rules of Criminal Procedure, 18 U.S.C.A., presenting untruthful statements by a Government witness subsequent to the trial as newly discovered evidence affecting his credibility at the trial. Such an allegation by the defense ordinarily will not support a motion for a new trial, because new evidence which is 'merely cumulative or impeaching' is not, according to the often-repeated statement of the courts, an adequate basis for the grant of a new trial.4
22
See also United States v. Johnson, 327 U.S. 106, 110—111, note 4 and note 5, 66 S.Ct. 464, 465—466, 90 L.Ed. 562.
23
Here we have an entirely different situation. The witness Mazzei was a paid informer of the Government—he had been in its employ from 1942 to 1953 for the purpose of infiltrating the Communist Party and reporting the facts found. He testified in this case in that capacity, as a Government witness. It is the Government which now questions the credibility of its own witness because in other proceedings in the same field of activity he gave certain testimony—some parts of it positively established as untrue and other parts of it believed by the Solicitor General to be untrue. The Solicitor General conceded that without Mazzei's testimony in this case the conviction of two of the petitioners cannot stand, but he argued that as to the other three Mazzei's evidence may not have had a substantial effect. But the trial judge believed Mazzei's testimony was material against them for, ever objection, he admitted it against all the defendants. There were only seven witnesses. The testimony of Mazzei, at least, gave flesh-and-blood reality to the mass of Communist literature read to the jury to show advocacy of violence by the Communist Party.5 This being so, it cannot be determined conclusively by any court that his testimony was insignificant in the general case against the defendants. Thus it has tainted the trial as to all petitioners. As we said last Term in Communist Party v. Subversive Activities Control Board:
24
'When uncontested challenge is made that a finding of subversive design by petitioner was in part the product of three perjurious witnesses, it does not remove the taint for a reviewing court to find that there is ample innocent testimony to support the Board's findings. If these witnesses in fact committed perjury in testifying in other cases on subject matter substantially like that of their testimony in the present proceedings, their testimony in this proceeding is inevitably discredited and the Board's determination must duly take this fact into account.' 351 U.S. 115, 124, 76 S.Ct. 663, 668.
25
There we remanded to the Subversive Activities Control Board for reconsideration of its original determination in the light of the record shorn of the tainted testimony. But there the Board, an administrative agency, was the original finder of fact. Here, on the other hand, in a criminal case, the original finder of fact was a jury. The district judge is not the proper agency to determine that there was sufficient evidence at the trial, other than that given by Mazzei, to sustain a conviction of any of the petitioners. Only the jury can determine what it would do on a different body of evidence, and the jury can no longer act in this case.6 For this reason, as well as that stated in the preceding paragraph, if on a remand the District Court should rule that the verdict against some of the petitioners could stand, we would be obliged, on a subsequent appeal, to reverse and, at that late date, direct that a new trial be granted.7 This case was instituted four and one-half years ago; petitioners have been proceeding in forma pauperis. The interests of justice could not be served by a remand that must prove futile.
26
It might be different if we could see in this case any factual issue upon which the District Court, on a remand, could make an unassailable finding that Mazzei's other falsehoods were differentiated from his testimony herein. But it is not within the realm of reason to expect the district judge to determine, as the Government indicated it would ask him to do, that the witness Mazzei testified truthfully in this case in 1953 as an undercover informer concerning the activities of the Communist conspiracy, yet concurrently appeared in the same role in another tribunal and testified falsely—possibly because of a psychiatric condition about a plan by different members of the Communist conspiracy to assassinate a United States Senator.8 That would be an unreasonable determination to make even though the judge might believe that Mazzei's bizarre testimony in 1956 concerning plans for the assassination of other officials, the destruction of bridges, training in sabotage and handling arms, and the poisoning of water in reservoirs, all to destroy the Government of the United States, was the product of a mental or emotional condition that had developed only after the time of this trial.
27
Mazzei, by his testimony, has poisoned the water in this reservoir, and the reservoir cannot be cleansed without first draining it of all impurity. This is a federal criminal case, and this Court has supervisory jurisdiction over the proceedings of the federal courts.9 If it has any duty to perform in this regard, it is to see that the waters of justice are not polluted. Pollution having taken place here, the condition should be remedied at the earliest opportunity.
28
'The untainted administration of justice is certainly one of the most cherished aspects of our institutions. Its observance is one of our proudest boasts. This Court is charged with supervisory functions in relation to proceedings in the federal courts. See McNabb v. United States, 318 U.S. 332, 63 S.Ct. 608, 87 L.Ed. 819. Therefore, fastidious regard for the honor of the administration of justice requires the Court to make certain that the doing of justice be made so manifest that only irrational or perverse claims of its disregard can be asserted.' Communist Party v. Subversive Activities Control Board, 351 U.S. 115, 124, 76 S.Ct. 663, 668.
29
The government of strong and free nation does not need convictions based upon such testimony. It cannot afford to abide with them. The interests of justice call for a reversal of the judgments below with direction to grant the petitioners a new trial.
30
It is so ordered.
31
Judgments reversed with directions.
32
Mr. Justice BRENNAN took no part in the consideration or decision of this case.
33
Mr. Justice HARLAN, with whom Mr. Justice FRANKFURTER and Mr. Justice BURTON join, dissenting.
34
When the Court's order denying the Government's motion to remand, and granting the petitioners a new trial, was announced by THE CHIEF JUSTICE on October 10, Mr. Justice FRANKFURTER, Mr. Justice BURTON and I dissented.1 We reserved our right to file an opinion stating our reasons for thinking that the Government's motion should have been granted. This is that opinion.
35
On 670, 671, 18 U.S.C. §§ 2385, 371, 18 U.S.C.A. §§ 2385, 371, by conspiring to advocate the overthrow of the United States Government by force and violence. The Court of Appeals for the Third Circuit, sitting en banc, affirmed by a divided vote.2 This Court granted certiorari.3
36
Mr. Justice FRANKFURTER, Mr. Justice BURTON, and Mr. Justice HARLAN dissent believing the Government's motion to remand should be granted, and reserve the right to file an opinion.
37
On September 27, 1956, about two weeks before the case was scheduled for argument, the Solicitor General filed a motion asking us to remand the case to the District Court for a hearing as to the truthfulness and credibility of one Mazzei, a government informant and witness at the trial. The occasion for this motion was that the Solicitor General's office, some ten days before, had come into possession of information which led it seriously to doubt the correctness of certain testimony given by Mazzei in various independent proceedings, all but one of which occurred after the trial, as to his relations with Communists and the Federal Bureau of Investigation.4 In its motion papers the Government stated that while it still believed that Mazzei's testimony at the trial had been 'entirely truthful and credible,' his post-trial testimony in these other proceedings was such as to 'lead us to suggest that the issue of his truthfulness at the trial of these petitioners should now be determined by the District Court after a hearing.' Petitioners' answer to this motion was that, while they considered themselves entitled to a judgment of acquittal or a new trial on the basis of the Government's disclosures, disposition of the Government's motion should nevertheless await this Court's decision on the issues brought here by the writ of certiorari.
38
On October 8, the Court directed that the Government's motion be heard orally at the threshold of the main case. My brother FRANKFURTER, who felt that the motion should have been granted forthwith, filed a dissenting memorandum.5 When the matter was heard by the Court on October 10, the positions taken by the Government and the defense were as follows: The Government was not yet prepared to say that Mazzei had committed perjury either at the trial or in any of the collateral proceedings.6 Conceivably, the Solicitor General thought, it might turn out that Mazzei was a psychiatric case. The Solicitor General pointed out that the petitioners had not previously moved for a new trial on the grounds relied upon in the Government's motion, although much of the later information as to Mazzei was known to them at the time of their motion for reargument in the Court of Appeals. Even so, the Solicitor General felt that in the broader interests of justice it was his duty to pursue the matter as soon as it came to his knowledge that a cloud was cast upon Mazzei's truthfulness or credibility.7 If he had been satisfied that Mazzei was a perjurer, the Solicitor General stated, he would have recommended that this Court reverse the convictions of two of the petitioners (Careathers and Dolsen). Since he was not so satisfied, he thought the proper procedure was to remand the case to the District Court for full exploration of the truthfulness and credibility of this witness.8 As to the other three petitioners, the Solicitor General regarded Mazzei's trial testimony of so little importance that the trial court, even if it found Mazzei was a perjurer, would have to review the entire case against them before ordering a new trial. Petitioners' position was that if this Court was unwilling to hear the main case on the merits, it should, without more, deny the Government's motion and reverse the convictions with directions for acquittal or at least a new trial. At the conclusion of the oral argument on the motion to remand, the Court recessed to consider the matter, following which its decision denying the Government's motion was announced from the bench.
39
We are in full agreement that the Court properly refused to pass on the merits of the case until this cloud upon the integrity of the convictions had been dissolved. Communist Party v. Subversive Activities Control Board, 351 U.S. 115, 76 S.Ct. 663. What we object to is that this Court itself should have undertaken to deal with the subtle and complicated issues presented by the Government's motion instead of sending the case back to the District Court for the determination of these issues after a full investigation. It is fitting that we state our reasons for this view.
40
1. We believe that the reversal of these convictions represents an unprecedented and dangerous departure from sound principles of judicial administration. The Court has overturned the results of a complex, protracted, and expensive trial before any investigation has been made of the suspicions which the Solicitor General brought to the attention of the Court promptly after the facts giving rise to them came to his notice. We find the Court's justification of its summary action unconvincing.
41
The basic justification given is that 'either this Court or the District Court should accept the statements of the Solicitor General as indicating the unreliability of this Government witness.' In effect, the Court has treated the case as if the Solicitor General had conceded the untrustworthiness of Mazzei's testimony at the trial. To us this reflects a misunderstanding of the Solicitor General's position. As to Mazzei's trial testimony, the Solicitor General—whose forthrightness and candor no one could doubt, and whose conduct in this situation has been commended by this Court—represented that the Government did not consider it yet had sufficient basis for regarding such testimony as untruthful. As to Mazzei's testimony in collateral proceedings, the Solicitor General, while stating his personal belief that some of it was untruthful, represented that he could not responsibly say whether such testimony involved perjury rather than psychopathic imbalance, and, if the latter, when that condition first arose or whether it was of such a character as to affect Mazzei's competency as a witness. In short, we think it abundantly clear that the Solicitor General conceded no more than that the situation was one that called for a thorough investigation.
42
We also observe that the Court finds that 'no other conclusion is possible' than that 'Mazzei's credibility has been wholly discredited,' and that some parts of his post-trial testimony have been 'positively established as untrue.' We do not see how these conclusions can be reached in the face of the Government's representation that it still believes Mazzei's trial testimony to have been 'entirely truthful and credible,' and without the production of any evidence, or the examination and cross-examination of Mazzei and those who contradicted him, as to the post-trial episodes which have been called in question. Nor can we agree with the manner in which the Court has dealt with the Solicitor General's contentions as to petitioners Mesarosh, Albertson and Weissman. The Court simply says that Mazzei's testimony against Careathers and Dolsen was of such a character that, having been admitted against all defendants, it tainted the whole trial. But we cannot understand how this can be said short of a painstaking appraisal of the entire record which the Court acknowledges it has not read. The Court was quite right not to read the record, for in our view this was not the business of this Court, but that of the District Court; but by the same token, we think, the decision as to whether a new trial was justified was also, in the first instance, the business of the District Court.
43
In the Communist Party case, supra, where there were undenied charges of perjury, we did not undertake to resolve those charges here, but instead sent the case back to the Board for exploration. We think a similar course should have been followed in this case. The Court suggests that the situation presented here differs from that in the Communist Party case, in that there the Board was the trier of the facts, whereas here it was for the jury, not the court, to weigh the truthfulness and credibility of Mazzei's trial testimony. This, however, overlooks the fact that as a preliminary to a new trial it must first be determined whether any of Mazzei's collateral testimony, now drawn in question, so reflects upon the truthfulness or credibility of his trial testimony as to warrant submission of the case to a new jury. That preliminary determination has always been recognized as the function of the trial court. United States v. Johnson, 327 U.S. 106, 66 S.Ct. 464, 90 L.Ed. 562; United States v. Troche, 2 Cir., 213 F.2d 401; United States v. Rutkin, 3 Cir., 208 F.2d 647; Gordon v. United States, 6 Cir., 178 F.2d 896, certiorari denied, 339 U.S. 935, 70 S.Ct. 664, 94 L.Ed. 1353.9
44
Finally, the Court suggests that a different result might have been required if it were dealing with a defense motion for a new trial. However, we fail to see why the Government's motion, which was prompted by a desire to ascertain the true facts in all their ramifications, and which is aimed at the possibility of a new trial, calls for a different result or procedure than a defense motion for a new trial based on similar suspicions.
45
2. The District Court was the proper forum for the kind of investigation which should have been conducted here. This Court, and for that matter the Courts of Appeals, are ill-equipped for such a task. We need say no more than that appellate courts have no facilities for the examination of witnesses; nor in the nature of things can they have that intimate knowledge of the evidence and 'feel' of the trial scene, which are so essential to sound judgment upon matters of such complexity and subtlety as those involved here, and which are possessed by the trial court alone.
46
3. Certainly there is no room for doubting the Solicitor General's good faith in this matter, or for supposing that the conduct of the further proceedings below would fall short of the highest standards of criminal justice. We have the Solicitor General's assurance that all of the Government's information bearing upon Mazzei's truthfulness and credibility would be made available to the defense, subject to appropriate safeguards.10 As to the end result, the Solicitor General stated that in his view the trial court would have to acquit petitioners Careathers and Dolsen if it found that Mazzei had perjured himself at the trial or had then been incompetent to testify, and as to the other petitioners might have to order a new trial.11 We need not consider at this time whether the Solicitor General's statement exhausts all of the factors that might require a new trial. Suffice it to say that we regard the Solicitor General's approach to this difficult situation as unexceptionable; and it is hardly to be assumed that the District Court would not do its full duty or would fall into error. We need only add that had the Government's motion been granted this Court would no doubt have accompanied its remand with appropriate instructions to guide the District Court in coping with this complicated problem. And surely the fact that this case has been long-drawn-out does not justify short-circuiting normal and orderly judicial procedures. The procedure adopted in United States v. Flynn, D.C., 130 F.Supp. 412; D.C., 131 F.Supp. 742, commends itself to us as a proper means of dealing with problems such as those raised by the Solicitor General's motion. We do not, of course, even remotely imply that we give any tolerance to the notion that a criminal conviction found to be infected by tainted testimony should be allowed to stand. We do say that ascertainment of where the truth lies here requires the kind of probing that is beyond the facilities and practices of this Court.
47
For the foregoing reasons we dissent. We think that the Government's motion to remand should have been granted.
1
The court directed that oral argument on the motions be heard at the time previously scheduled for the argument on the merits. 352 U.S. 808, 77 S.Ct. 14. Mr. Justice Frankfurter, believing the motion should be granted without argument, filed a dissent.
After hearing argument on the motions, October 10, 1956, the Court recessed to consider the matter, following which its decision to order a new trial was announced from the bench. 352 U.S. 1, 862, 77 S.Ct. 8. Argument on the merits, therefore, was not heard. Mr. Justice Frankfurter, Mr. Justice Burton, and Mr. Justice Harlan dissented from the denial of the Government's motion to remand.
This opinion has been written to amplify the decision announced October 10, 1956. It should be noted that Mr. Justice Minton participated in the consideration and decision of the motions, voting in favor of the order of the Court. On October 15, 1956, prior to the writing of this opinion, he retired from the Court. Therefore he did not participate in the consideration of this opinion.
2
It was alleged that between 1945 and the date of the indictment the petitioners had conspired to advocate the overthrow of the Government of the United States by force and violence and to organize a society or group, the Communist Party, devoted to that purpose. The trial judge ruled that the organization charge was barred by the statute of limitations, but that evidence concerning the 1945 organization of the Communist Party, as well as earlier events, was admissible in determining whether petitioners had conspired to advocate violence.
3
The Solicitor General's motion stated that his office came into possession of 'the history of Mazzei's post-trial testimony' less than ten days before the motion was filed. With one exception, the motion does not indicate when other units of the Department of Justice acquired their information of Mazzei's conduct.
4
See, e.g., United States v. Johnson, 7 Cir., 142 F.2d 588, 592, certiorari dismissed, 323 U.S. 806, 65 S.Ct. 264, 89 L.Ed. 643; United States v. Rutkin, 3 Cir., 208 F.2d 647, 654; United States v. Frankfeld, D.C., 111 F.Supp. 919, 923, affirmed sub nom. Meyers v. United States, 4 Cir., 207 F.2d 413. But see United States v. On Lee, 2 Cir., 201 F.2d 722, 725—726 (dissenting opinion).
5
Although we have not examined the evidence in this case, in view of the disposition made, we deem it appropriate to consider herein the nature of Mazzei's testimony, since petitioners' counter-motion referred us to the appropriate pages of the transcript. The same pages had also been cited in the main briefs of both parties in summarizing the evidence.
Mazzei testified quite specifically about statements by defendants Careathers and Dolsen, made in classes each had taught at a Communist Party school he had attended in 1943 or in private conversations each had had with him at that time.
Careathers taught in his class, Mazzei testified, about the part the Negro people would play in bringing about a revolution. (Tr. 1940—1941.) Dolsen told his class, with Careathers present, that the only way a revolution could come about would be by violent overthrow of the government, with the Communist Party helping. (Tr. 1923.) Mazzei related other details of Dolsen's teaching, and passages were read to the jury which he said Dolsen had read to the class from the History of the Communist Party of the Soviet Union. (Tr. 1922—1923, 1936—1938.)
Massei told how Dolsen and Careathers had each given him private instruction after class, because each was unsatisfied with his understanding of a lesson in Dolsen's class. Mazzei related that each had told him in these separate private sessions that a revolution in this country could only come by armed violence, and that it would be with the help of the Communist Party and the Soviet Union (Tr. 1940, 1943.) Mazzei also testified that Dolsen had told him, on an auto trip, that if a revolution came about, he would not hesitate to kill, as he had done in China, where he had worked with the Communist Party. (Tr. 1945.)
6
Cf. Gordon v. United States, 344 U.S. 414, 422—423, 73 S.Ct. 369, 374—375, 97 L.Ed. 447.
The present situation is different from that in United States v. Flynn, D.C., 130 F.Supp. 412, reargument denied, D.C., 131 F.Supp. 742. There the defense moved for a new trial on the basis of an affidavit in which a witness recanted his testimony after the trial. The Government charged that the recantation, rather than the testimony it contradicted, was the lie. Hence there was a factual issue to be determined at the outset, unlike the present case, where there is no conflict between the trial testimony and the subsequent matter brought forward by the Government as bearing on credibility. This difference has been recognized by the courts as calling for the application of different tests in passing on a motion for new trial, even without the added distinction of this case that it is the Government which questions the witness's credibility. See, e.g., United States v. Johnson, 7 Cir., 142 F.2d 588, 591—592, certiorari dismissed, 323 U.S. 806, 65 S.Ct. 264, 89 L.Ed. 643; United States v. Hiss, D.C., 107 F.Supp. 128, 136, affirmed, 2 Cir., 201 F.2d 372. Therefore, we express no opinion as to the procedure followed by Judge Dimock in the Flynn case.
7
Cf. Remmer v. United States, 347 U.S. 227, 74 S.Ct. 450, 98 L.Ed. 654; 348 U.S. 904, 75 S.Ct. 288, 99 L.Ed. 710; 350 U.S. 377, 76 S.Ct. 425.
Because the situation raised by the Solicitor General's motion is quite distinct from that of the ordinary defense motion for new trial, see 352 U.S. 9, 10, 77 S.Ct. 5, supra, we would not consider ourselves bound on a review of the District Court's ruling in this situation by the limitations expressed with reference to the defense motion in United States v. Johnson, 327 U.S. 106, 66 S.Ct. 464, 90 L.Ed. 562.
See also note 6, supra.
8
The trial of petitioners started February 24, 1953. Mazzei testified against petitioners on March 26, 27, and 30. It was on June 18 that he testified before the Senate Committee. On July 9, a motion for a mistrial was made on the basis of the prejudice alleged to be caused petitioners by the publicity given the June 18 testimony of Mazzei concerning the assassination of Senator McCarthy. Mistrial was denied. The jury found petitioners guilty on August 20. They were sentenced on August 25, on which date motions for new trial were denied.
9
Cf. McNabb v. United States, 318 U.S. 332, 340—341, 63 S.Ct. 608, 612—613, 87 L.Ed. 819; Thiel v. Southern Pacific Co., 328 U.S. 217, 225, 66 S.Ct. 984, 988, 90 L.Ed. 1181.
1
352 U.S. 862, 77 S.Ct. 8.
2
223 F.2d 449.
3
350 U.S. 922, 76 S.Ct. 218.
4
One of these episodes took place before the Senate Permanent Subcommittee on Investigations, in Washington, D.C., on June 18, 1953 (while the trial was still in progress). There Mazzei had testified that at a meeting of the Civil Rights Congress on December 4, 1952, one Louis Bortz (an alleged Communist Party functionary) told him that he, Bortz, had been 'selected by the Communist Party to do a job in the liquidation of Senator Joseph McCarthy.' On the oral argument the Solicitor General told us that the Government was not prepared at the time of the trial to regard this testimony of Mazzei as a fabrication, because Bortz when questioned on this subject before the Senate Committee had pleaded his privilege, stating that the answers to the questions 'would' incriminate him.
It appears that Mazzei's Senate testimony was brought to the attention of the trial judge and that it was the basis of an unsuccessful defense motion for a mistrial. The Solicitor General further stated that it was not until the recent discovery of Mazzei's later testimony in the other post-trial collateral proceedings—particularly that given in certain Florida disbarment proceedings on July 2, 1956—that his department began to have serious doubts as to Mazzei's truthfulness or credibility.
5
352 U.S. 808, 77 S.Ct. 14.
6
As to Mazzei's trial testimony, the Solicitor General stated: 'Before the witness (Mazzei) was presented to the (trial) court, his testimony was carefully appraised as to whether or not it was supported by any other material the Department had, and he was not contradicted. Although witnesses took the stand in behalf of the defendants his testimony was not contradicted at all, and that was one of the factors that bothered the Government in connection with these subsequent events that have caused us to conclude that this man's testimony should be carefully reexamined by the lower court in regard to validity at the time of the trial, because of what has occurred since, which, ordinarily, even though there was actual perjury, would not determine the validity of the testimony at the trial, depending upon what the circumstances were.'
As to Mazzei's testimony in the collateral proceedings, the Solicitor General stated: 'We believe that his (1953 Senate) testimony in that regard (the McCarthy incident) was not credible in light of what happened later (in the Florida disbarment proceedings). We do not know at this point whether or not there is something psychiatric about this situation. We are disturbed about that.' The Solicitor General further stated that while his 'personal belief is he (Mazzei) was not truthful' in his testimony as to the McCarthy episode, 'I don't want it left on the record that I believe this man to be a perjurer, because I think in order to commit perjury you have to have the intent, and that is what disturbs me about this whole situation. I can't accept his testimony, over all these events (referring to Mazzei's Senate and Florida testimony), as being valid. But whether or not he knowingly does it with the intent (to commit perjury) is something else and that is what I can't follow through.'
As to the possibility of Mazzei's being a psychopath: The Government's motion papers showed that in 1952 Mazzei had pleaded guilty to charges of adultery and bastardy in a Pennsylvania state court, and that this fact had been brought out at petitioners' trial. They further showed that in 1953, after petitioners' trial had ended, Mazzei had moved in the Pennsylvania court to set aside his former plea, alleging that he 'was not guilty of the charge to which he was induced to plead * * * but did so only in his official capacity (as a Government informant) at the insistence of his superior in the FBI to avoid testifying.' These allegations, the Government informs us, were denied under oath by the F.B.I. and Mazzei's application to set aside his plea was denied by the Pennsylvania court. Further, the Government's motion papers here show that in the 1956 Florida disbarment proceedings Mazzei testified that the F.B.I. had arranged to get him into the Army so that he could watch a certain Communist Party member, whereas in fact Mazzei was drafted into the Army, and the F.B.I. had nothing to do with it. The Government states that in the same proceedings Mazzei testified that the F.B.I. paid him about $1,000 a month for expenses, whereas over the entire period from 1942 to 1952 the F.B.I. had paid and that Mazzei testified he had never him total expense money of only $172.05; been arrested, whereas in fact he had been arrested several times. As to these episodes the Solicitor General stated at the oral argument: 'It certainly seems to me that that is a very peculiar action, and that he (Mazzei) should have anticipated, even if he wanted to lie about it, that the FBI agent would be there promptly testifying to the facts. And so it is very unusual to me that a person normally, wanting to falsity, would do such a thing. But, I think the trial courts have examined into competency a good many times, and do it every day, and should be able to determine whether or not he was competent at the time.' The Solicitor General also stated that he was 'disturbed about whether it (a psychopathic condition) occurred even back at the trial (of these petitioners), and I think the court should examine into that carefully.' (The above, and similar quotations, are taken from the tape recording of the Solicitor General's oral argument before this Court, the writer's interpolations being indicated by brackets.)
7
As to this the Solicitor General stated: 'If I may say one word more in regard to that (the failure of the defense to move for a new trial), I feel that the obligation of the Government in a situation of this kind reaches far beyond the rights of these particular defendants, and it is its duty to this Court, and to the country, and it is our obligation in a situation of this kind, to try and see that justice is done. * * * We may be criticized for being too late, but I think it is never too late, to try to do justice. Having come to that conclusion (that the validity of this testimony is open to doubt), I think we should come before the courts, whichever one is proper, and try to get a correction of the wrong, if there is one.'
8
The Solicitor General stated: 'Well, we would have recommended that (reversal) to the Court if we had been satisfied ourselves that Mazzei's testimony at the time of trial—which we think was the determining point in the proper conduct of judicial proceedings—(was untruthful), * * * because we feel at least as to these two defendants (petitioners Careathers and Dolsen) there was no (other) basis for their conviction. But it is possible that something has happened to this man (Mazzei), that his uncontradicted testimony was valid at the time of trial, and it seemed to us that with a long case tried like this and the jury involved and the trial court and the courts of appeal, and so on, the proper thing to do was to send it back to the trial court for its examination carefully into this question to determine what the fact is, and then assume that he (the trial court) would do his duty, which I think he will, and have the case handled properly at that point.'
9
Whatever may be the differences between the rules governing a motion for a new trial based upon recantation of trial testimony or other types of 'newly discovered' evidence, ante, 352 U.S. 12, 77 S.Ct. 7, note 6, certainly none of those differences suggest that the trial court is not the proper tribunal for resolution of the issues presented by such a motion.
10
In response to a question as to whether the defense would be furnished with all of the Government's information bearing on the truth of Mazzei's Senate testimony relating to the McCarthy incident, the Solicitor General stated: 'Well, that would depend on what the trial court thought should be done, I think, in the conduct of the case. The only reason I suggest that possibly it should not be made available to them is that in this whole problem there are several people involved who might get hurt by a public airing of their connection with this matter. And it would be too bad, and very unfortunate, if it wasn't handled so as not to injure those people when it isn't necessary to the proper handling of this problem. * * * We will do whatever this Court thinks we should do, but what I had in mind was to lay before the judge all of the information the Government has about the entire matter, and then he can sort out and protect the various innocent persons, who are described in the files, and should not be hurt in such a proceeding, and yet give them (the defendants) the benefit of the full and complete protection in such a proceeding as to what the facts are in this matter. * * * I had in mind that certain portions the judge would handle in camera so as to protect innocent people. And all others, that would reach into the merits of the situation, would certainly be handled by the court in such a way as to give all the parties an adequate opportunity to present their defense.'
11
The Solicitor General stated: 'Yes, without his (Mazzei's) testimony as to those defendants (Careathers and Dolsen), I do not think they could have been convicted. I think the court would have had to direct a verdict in their favor, at least. As to the other three defendants, there is practically no testimony by this witness. It is very slight. I could give it to the Court. * * * (It) seems to me the lower court would have to examine the situation and see * * * whether or not it (Mazzei's testimony) had an effect on the conviction of every one of the defendants. * * * It would seem to me that * * * the trial court could determine the extent of the effect that this witness might have had on the other defendants, because there was a large volume of testimony in regard to the other defendants that bore directly upon their participation in the conspiracy, and their overt acts; and the testimony of this witness was so limited as to even a reference—he said that they solicited money from him, two of them and is so slight as to any direct connection with it, that it seems to me the court would have to weigh whether or not, under that situation, he would decide that there is a doubt in his mind, in which case I am sure he would (direct a new trial).' In the absence of an exhaustive examination of the voluminous record, we are unable to understand how any adequate evaluation could be made of these considerations as to the petitioners Mesarosh, Albertson, and Weissman. When he was asked to 'assume' that the trial court would find Mazzei to have been a perjurer, and his trial testimony to have been of importance in the conviction of these three petitioners, the Solicitor General promptly stated that he was 'satisfied' that the court would set aside their convictions 'if he came to these conclusions.'
| 01
|
352 U.S. 29
377 S.Ct. 119
1 L.Ed.2d 93
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, Petitioner,v.Gilbert S. PARNELL. BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, Petitioner, v. FIRST NATIONAL BANK IN INDIANA.
Nos. 21, 22.
Argued Oct. 18, 1956.
Decided Nov. 13, 1956.
Mr. Erwin N. Griswold, for the petitioner in both cases.
Mr. Edward Dumbauld, Uniontown, Pa., for respondent in No. 21.
Mr. Harvey A. Miller, Jr., Pittsburgh, Pa., for respondent in No. 22.
Mr. Justice FRANKFURTER delivered the opinion of the Court.
1
Petitioner, alleging diversity of citizenship, brought suit in the District Court for the Western District of Pennsylvania alleging that in September and October 1948 two individual defendants, Parnell and Rocco, and two corporate defendants, the First National Bank in Indiana and the Federal Reserve Bank of Cleveland, had converted 7o Home Owners' Loan Corporation bonds which belonged to petitioner. Only Parnell and the First National Bank are respondents here, since the Federal Reserve Bank was dismissed, on its motion, after petitioner had presented its case in the District Court, and since Rocco did not appeal from the District Court's judgment.
2
At the trial it appeared that these bonds were bearer bonds with payment guaranteed by the United States. They carried interest coupons calling for semiannual payment. They were due to mature May 1, 1952, but pursuant to their terms, had been called on or about May 1, 1944. On May 2, 1944, the bonds disappeared while petitioner was getting them ready for presentation to the Federal Reserve Bank for payment. In 1948 they were presented to the First National Bank for payment by Parnell on behalf of Rocco. The First National Bank forwarded them to the Federal Reserve Bank of Cleveland. It cashed them and paid the First National Bank, which issued cashier's checks to Parnell. Parnell then turned the proceeds over to Rocco less a fee—there was conflicting testimony as to whether the fee was nominal or substantial.
3
The principal issue at the trial was whether the respondents took the bonds in good faith, without knowledge or notice of the defect in title. On this issue the trial judge charged:
4
'As I have indicated, however, in the case—and if you find in this case that the plaintiff owned these bonds, that they were stolen from it—then the burden of proof so far as this plaintiff is concerned is to show that fact, that these bonds were owned by it, that they were lost by it in the manner as shown by its evidence. Then the two defendants, Parnell and the bank, not claiming to be owners for value, but as conducts for redemption, must come forward and they then have the burden of showing that they acted innocently, honestly, and in good faith. * * *'
5
The jury brought in verdicts for petitioner against both respondents. On appeal, the Court of Appeals for the Third Circuit, the seven circuit judges sitting en banc, reversed, with three judges dissenting. It held that the District Court had erred in treating the case as an ordinary diversity case and in regarding state law as governing the rights of the parties and the burden of proof. 226 F.2d 297. It considered our decision in Clearfield Trust Co. v. United States, 318 U.S. 363, 63 S.Ct. 573, 87 L.Ed. 838, controlling and held that federal law placed the burden of proof on petitioner to show notice and lack of good faith on the part of respondents. The court further found that there was no evidence of bad faith by the First National Bank since the bonds were not 'overdue' as a matter of federal law when presented to it and therefore directed entry of judgment for it. The court found that there was evidence of bad faith on the part of Parnell but ordered a new trial because of the erroneous instructions.
6
The dissenters agreed in applying the doctrine of the Clearfield Trust case to determine the nature of the contract and the rights and duties of the United States as a party but not the rights of private transferees among themselves. They, like the majority, looked to federal law to determine whether the bonds were 'overdue paper' when presented to the First National Bank. They concluded that since the respondent bank knew of the call as to it, the bonds became demand paper and that the bank took the paper an unreasonable length of time after maturity, as advanced by the call.
7
In the view of the dissenters, state law was controlling with respect to proof of good faith and the burden thereon. They found that state law placed the burden of proof on respondents to demonstrate their good faith, and that there was sufficient evidence to support the jury's verdict that the burden of proving good faith had not been sustained even if, with respect to the respondent bank, the bonds were not to be regarded as demand paper taken an unreasonable time after maturity, as advanced by the call.
8
Petitioner sought a writ of certiorari to review the judgments of the Court of Appeals. Because the determination of the applicable law raised an important issue of federal-state relations, we granted certiorari. 350 U.S. 963, 76 S.Ct. 433, 434.
9
The District Court in this suit, based on diversity jurisdiction, for the conversion in Pennsylvania of pieces of paper of defined value, deemed itself a court of Pennsylvania in which, in view of the nature of the claim, Pennsylvania law would govern. See Guaranty Trust Co. of New York v. York, 326 U.S. 99, 108, 65 S.Ct. 1464, 1469, 89 L.Ed. 2079. But respondents claim, and the Court of Appeals sustained them, that the decision in Clearfield Trust Co. v. United States, 318 U.S. 363, 63 S.Ct. 573, 87 L.Ed. 838, compels the application of federal law to the entire case. The Court of Appeals misconceived the nature of this litigation in holding that the Clearfield Trust case controlled. In that case we held that a suit by the United States to recover on an express guaranty of prior endorsements on a Government check with a forged endorsement was governed by federal law. The basis for this decision was stated with unclouded explicitness:
10
'The issuance of commercial paper by the United States is on a vast scale and transactions in that paper from issuance to payment will commonly occur in several states. The application of state law, even without the conflict of laws rules of the forum, would subject the rights and duties of the United States to exceptional uncertainty.' 318 U.S. at page 367, 63 S.Ct. at page 575.
11
Securities issued by the Government generate immediate interests of the Government. These were dealt with in Clearfield Trust and in National Metropolitan Bank v. United States, 323 U.S. 454, 65 S.Ct. 354, 89 L.Ed. 383. But they also radiate interests in transactions between private parties. The present litigation is purely between private parties and does not touch the rights and duties of the United States. The only possible interest of the United States in a situation like the one here, exclusively involving the transfer of Government paper between private persons, is that the floating of securities of the United States might somehow or other be adversely affected by the local rule of a particular State regarding the liability of a converter. This is far too speculative, far too remote a possibility to justify the application of federal law to transactions essentially of local concern.
12
We do not mean to imply that litigation with respect to Government paper necessarily precludes the presence of a federal interest, to be governed by federal law, in all situations merely because it is a suit between private parties, or that it is beyond the range of federal legislation to deal comprehensively with Government paper. We do not of course foreclose such judicial or legislative action in appropriate situations by concluding that this controversy over burden of proof and good faith represents too essentially a private transaction not to be dealt with by the local law of Pennsylvania where the transactions took place. Federal law of course governs the interpretation of the nature of the rights and obligations created by the Government bonds themselves. A decision with respect to the 'overdueness' of the bonds is therefore a matter of federal law, which, in view of our holding, we need not elucidate.
13
This conclusion requires reversal of the judgments of the Court of Appeals but not reinstatement of the judgments of the District Court. The Court of Appeals did not originally consider all the points raised by respondents. Moreover, since the Court of Appeals misconceived the applicable law, it is for that court to review the judgments of the District Court in the light of the controlling state law. The Court of Appeals has not decided what the governing state law on burden of proof is, and it is the court which should so decide. Likewise, if state law casts the burden on respondents to demonstrate their good faith, it is for the Court of Appeals to assess the evidence in light of that standard.
14
The judgments of the Court of Appeals for the Third Circuit are therefore reversed and the cases are remanded to that court for proceedings in conformity with this opinion.
15
Reversed and remanded.
16
Mr. Justice BLACK and Mr. Justice DOUGLAS, dissenting.
17
We believe that the 'federal law merchant' which Clearfield Trust Co. v. United States, 318 U.S. 363, 367, 63 S.Ct. 573, 575, 87 L.Ed. 838, held applicable to transactions in the commercial paper of the United States should be applicable to all transactions in that paper. Indeed the Court said in National Metropolitan Bank v. United States, 323 U.S. 454, 456, 65 S.Ct. 354, 355, 89 L.Ed. 383, that 'legal questions involved in controversies over such commercial papers are to be resolved by the application of federal rather than local law'. Not until today has a distinction been drawn between suits by the United States on that paper and suits by other parties to it. But the Court does not stop there. Because this is 'essentially a private transaction', it is to be governed by local law. Yet the nature of the rights and obligations created by commercial paper of the United States Government is said to be controlled by federal law. Thus, federal law is to govern some portion of a dispute between private parties, while that portion of the dispute which is 'essentially of local concern' is to be governed by local law. The uncertainties which inhere in such a dichotomy are obvious. Cf. Southern Pacific Co. v. Jensen, 244 U.S. 205, 37 S.Ct. 524, 61 L.Ed. 1086; Davis v. Department of Labor, 317 U.S. 249, 63 S.Ct. 225, 87 L.Ed. 246.
18
The virtue of a uniform law governing bonds, notes, and other paper issued by the United States is that it provides a certain and definite guide to the rights of all parties rather than subjecting them to the vagaries of the law of many States. The business of the United States will go on without that uniformity. But the policy surrounding our choice of laws is concerned with the convenience, certainty, and definiteness in having one set of rules governing the rights of all parties to government paper, as contrasted to multiple rules. If the rule of the Clearfield Trust case is to be abandoned as to some parties, it should be abandoned as to all and we should start afresh on this problem.
| 910
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352 U.S. 40
77 S.Ct. 106
1 L.Ed.2d 102
The UNITED STATES, Petitioner,v.Alfred C. BERGH et al.
No. 17.
Argued Oct. 15, 1956.
Decided Nov. 19, 1956.
Mr. Alan S. Rosenthal, Washington, D.C., for petitioner.
Mr. Herbert S. Thatcher, Washington, D.C., for respondents.
Mr. Justice CLARK delivered the opinion of the Court.
1
This action was instituted in the United States Court of Claims by government per diem employees to recover holiday pay consisting of an extra day's compensation for each holiday worked during the year 1945.
2
Each of the respondents was employed by the Navy under a Schedule of Wages which provided that 'whenever an employee is relieved or prevented from working solely because of the occurrence of any day declared a holiday' he was to receive the same pay for such days as for other days. This language was taken from a Joint Resolution of Congress of June 29, 1938, 52 Stat. 1246,1 having to do with holiday pay. In 1945 the respondents were not relieved from working on certain holidays named in this Resolution and were paid only the regular scheduled pay for the work performed on those days. They contend that under a Joint Resolution of January 6, 1885, 23 Stat. 516,2 they have a vested right to an additional full day's wage as 'gratuity pay' for each holiday worked. The Government urges that the 1885 Resolution was repealed in toto by the Joint Resolution of June 29, 1938, or in the alternative that the latter is inconsistent and in conflict with the provisions of the earlier Resolution upon which respondents rely.
3
The Court of Claims entered judgment for respondents, believing that the issue 'was considered and disposed of by (its) majority opinion * * * in Kelly v. United States, 96 F.Supp. 611, 119 Ct.Cl. 197', holding that the employees concerned were entitled to gratuity pay under a Joint Resolution, of 1895, not here involved, as well as under their wage agreement negotiated through collective bargaining in 1924. 132 F.Supp. 462, 464, 132 Ct.Cl. 564. While we affirmed the Kelly case, 342 U.S. 193, 72 S.Ct. 213, 96 L.Ed. 222, it was on the basis of the wage agreement present there. We left open the issue involved here. Subsequently, thousands of claims based on the 1885 Resolution, including those of respondents, were filed against the Government, necessitating a decision on the question now presented. We granted certiorari, 350 U.S. 953, 76 S.Ct. 342.
4
The legislative history of the 1938 Resolution is clear. Executive Order No. 7763 of December 6, 1937, 2 Fed.Reg. 2685, excused all government employees from work on December 24, 1937. Under the 1885 Resolution per diem employees received no compensation for that day since the holidays enumerated therein did not include December 24. A Joint Resolution was introduced in the House by Representative Ramspeck to allow holiday pay to per diem employees for that day. On referral to the House Committee on Civil Service, advice was sought from the Civil Service Commission, the Bureau of the Budget, and the Comptroller General. The Civil Service Commission advised by letter dated February 15, 1938, that the 'accounting authorities, however, have held that in the absence of specific legislation the regular employees of the Federal Government whose compensation is fixed at a rate per day, per hour, or on a piece-work basis lose pay for that day. This has resulted in discrimination against these groups of Federal employees.' The Commission advised, further, that 'there is the broader question involved of securing statutory authority for such payments as a general practice * * *.' H.R. Rep. No. 2683, 75th Cong., 3d Sess. 2. The Commission suggested the language that might be inserted in a Resolution that 'would give permanent statutory authority' for holiday pay. In addition, the Commission's reference to the 'accounting authorities' revealed that the Comptroller General had advised the Secretary of the Navy on December 20, 1937, that under existing law (a) per annum employees suffered no loss of income as the result of holidays, whether declared by statute or executive order, where as per diem employees received pay only for those holidays enumerated in the 1885 Resolution; (b) per diem employees received statutory holiday pay whether the holiday happened to fall on a nonwork day (Saturday or Sunday) or not, while per annum workers were allowed neither additional pay nor holiday time when the holiday happened to fall on a nonwork day; and (c) if a per diem employee worked on a statutory holiday falling on such a nonwork day, he received double pay.3
5
In its Report, supra, to the House, the Committee incorporated the letter from the Commission, the advisory opinion of the Comptroller General, and a letter dated February 14, 1938, from the Bureau of the Budget advising that the proposed legislation would not be 'in conflict with the program of the President.' The Committee drafted an entirely new Resolution, incorporating the language suggested by the Commission, intending for it to cover the 'general practice' of the Government in regard to holiday pay. The only legislation then covering the general practice of the Government as to holiday pay was the 1885 Resolution and as to it the Committee categorically declared in its Report:
6
'Section 2 (of the Resolution) proposes to repeal the joint resolution of January 6, 1885 (U.S.C., title 5, sec. 86), which is as follows: * * *.' (It then sets out in full the 1885 Resolution.)
7
Furthermore, there is no indication anywhere in its Report that any portion of the 1885 Resolution—much less any administrative practice thereunder—was to survive. In addition to this unequivocal statement that the purpose of the 1938 Resolution was to repeal the 1885 one, the Committee further revealed by its action under the Rules of the 75th Congress that it so intended. The Rules required a Committee reporting out a bill repealing an act or part thereof to include in its report the text of the act or part thereof proposed to be repealed. The Report here included the text of the 1885 Resolution in toto. On the other hand, if it was intended only that the 1885 Resolution be amended, the Rules required the Committee to insert in its report a comparative print of the part of the act which it proposed to be amended. Here no such comparative print was inserted.
8
Moreover, the few brief statements on the floor of the House show nothing to the contrary. Representative Ramspeck declared that the Resolution 'gives the same right to per diem employees as to the regular monthly employees.' Representative Rogers stated, 'This simply prevents an unintentional discrimination.' Nothing was said as to the 1885 Resolution, nor did anyone contend, contrary to the Committee Report, that it was not the intention to repeal it in toto. See 83 Cong.Rec. 9466—9467.
9
It is contended that the purpose of the 1938 Resolution was to increase the number of holidays for per diem employees to include those allowed by executive order, but to leave intact the allowance of double pay for per diem employees who worked on the holidays specified in the 1885 Resolution. This cannot be correct for no one contends that the 1938 Resolution did not repeal the 1885 Resolution, as interpreted, with reference to holiday pay on nonwork days. That being so, we cannot see why the 1885 Resolution should be regarded as having been left unrepealed with reference to holiday pay on work days.4 Moreover, respondents' contention is entirely untenable in light of the Committee Report. Confusion would be created rather than eliminated if the contention were accepted. The purpose, as shown by the letters, the advisory opinion, the Report, and the statements on the floor of the House, was to alleviate discriminations as to holiday pay and to treat employees alike insofar as possible. This the 1938 Resolution accomplished. Should the respondents' interpretation prevail, it would result in a double standard of pay for per diem employees working on holidays. On those holidays included in the 1885 Resolution, the employees would receive double pay, while on holidays included in or created pursuant to the authority provided by the 1938 Resolution alone they would receive only single pay. This result is required because the 1938 Resolution permits no holiday pay when the employee is required to work. We cannot attribute such anomalous results to the Congress. It is urged that our interpretation would result in a per diem employee receiving the same pay for working on a holiday as is received by his fellow employee who is excused from so working. But this is no discrimination as it likewise is visited upon the per annum employee.5
10
We now turn to other indications supporting the position that the 1885 Resolution was repealed. As we indicated earlier, the double payment for holiday work recognized prior to the 1938 Resolution came about in 1906 through an interpretation of the 1885 Resolution by the Assistant Comptroller of the Treasury. This ruling was recognized by all departments and agencies of the Government until August 1938, when the Comptroller General held that the 1885 Resolution had been repealed by the 1938 Resolution and gratuity pay for holidays was no longer a right of per diem employees.6 This opinion was followed consistently by all of the departments and agencies of the Government. In this regard it is of importance to note that several efforts were made to repeal this interpretation by specific Act of Congress, but in each instance the bill failed to pass.7 This contemporaneous interpretation of the 1938 Resolution by the agency charged with its supervision—an interpretation followed by all agencies of the Government—together with acquiescence of the Congress, must be given great weight.
11
Likewise it is noted that the House Committee on the Revision of Laws has similarly treated the 1938 Resolution. In the 1940 and 1946 recodifications of the United States Code the 1885 Resolution is listed as being repealed by the later Resolution of 1938. Again in the 1952 edition of the Code the 1885 Resolution is not only listed as repealed but its entire text is omitted from the Code. An explanatory notation states that this Resolution was repealed and is now covered by § 86a which is the 1938 Resolution.
12
As we noted earlier, this case is not disposed of by United States v. Kelly, 342 U.S. 193, 72 S.Ct. 213, 96 L.Ed. 222, and nothing in Kelly lends support to the employees' argument here. Kelly was a printer employed at the Government Printing Office. The wages of employees in Kelly's office were fixed by a collective-bargaining agreement pursuant to the Act of June 7, 1924, 43 Stat. 658, 44 U.S.C.A. § 40. This Act, though amended, remained in effect as to the provisions involved here at the time of Kelly's claim. The Contract Kelly sued on was entered into by the Government under this Act. We said the problem was 'whether the (1938) Resolution somehow precludes the awarding of the gratuity pay which the agreement (so made) seems to grant.' 342 U.S. at page 194, 72 S.Ct. at page 214. We held that 'since the agreement provided for gratuity pay for holidays worked, (Kelly) was entitled to such pay.'8 The award to Kelly, then, was solely on the basis of the collective-bargaining agreement. Here there is no such agreement. There is nothing on which the employees can rely which affirmatively grants the double pay they claim.
13
The judgment of the Court of Claims is, therefore, reversed.
14
Reversed.
15
Mr. Justice BRENNAN took no part in the consideration or decision of this case.
16
Mr. Justice BURTON, with whom Mr. Justice BLACK and Mr. Justice FRANKFURTER concur, dissenting.
17
The issue before us is purely one of statutory construction. For the reasons hereafter stated, we believe that the Court has misconstrued the Resolution of 1938 by treating it as completely repealing the Resolution of 1885 and all other prior holiday pay statutes. Our conclusion is based upon (1) the long-established practice under the Resolution of 1885, as amended, or allowing a full day's gratuity pay to per diem employees on holidays, whether or not those employees also received pay for services actually rendered on those days; (2) the language of the 1938 Resolution; (3) the circumstances which led to the presentation of the 1938 Resolution; and (4) the legislative history of its consideration by Congress.
18
The Joint Resolution of January 6, 1885, 23 Stat. 516, 5 U.S.C. (1934 ed.) § 86, 5 U.S.C.A. § 86, provided—
19
'That the employees of the Navy Yard, Government Printing Office, Bureau of Printing and Engraving, and all other per diem employees of the Government on duty at Washington, or elsewhere in the United States, shall be allowed the following holidays, to wit: The first day of January, the twenty-second day of February, the fourth day of July, the twenty-fifth day of December, and such days as may be designated by the President as days for national thanksgiving, and shall receive the same pay as on other days.'1
20
This Resolution was interpreted repeatedly by the Comptroller of the Treasury, the Comptroller General of the United States, and later the Court of Claims, as allowing the designated per diem employees, on the specified holidays, their regular rate of pay as a gratuity, whether or not they worked on those days. Those who worked on such holidays received their scheduled pay for such work in addition to the holiday gratuity.2 The administrative practice conformed to this interpretation.
21
This interpretation and the reason for it is made clear in the following quotation from the Comptroller of the Treasury:
22
'I can not reconcile with any ideas of equity and justice the proposition that Congress ever intended by this or any other statute to allow the employees (and we are now speaking of per diem employees who are paid from a lump sum and not a stated, fixed annual salary) a legal holiday with pay, and place it in the power of yourself or any other person to cause any such employee to work on such day, such employee so working receiving just the same amount of pay for said day as those who are not compelled to work, and no more.
23
'The laborer is worthy of his hire and should have it when compelled to work on a holiday. The giving him pay for such a day when he does not work is the free gift of Congress, and I will not stultify such gift by taking away from him his pay on a day for which he worked because Congress saw fit to give him pay for legal holidays when he did not work.
24
'You are therefore authorized to pay to the employees named their wages for work done on Thanksgiving Day in addition to their pay as provided by said act of 1895.' 8 Comp.Dec. 322, 325 (1901).
25
Thus, until 1938, it was the Government's settled practice to allow gratuity pay to per diem employees on the specified holidays, whether or not the employees performed work on those holidays. It was in that significant context, late in 1937, that the incident occurred which led to the House Joint Resolution of June 29, 1938, 52 Stat. 1246, 5 U.S.C. (1952 ed.) § 86a, 5 U.S.C.A. § 86a.
26
On December 6, 1937, the President, by Executive Order No. 7763, 2 Fed.Reg. 2685, closed the government offices and excused all government employees from work on Friday, December 24, the day before Christmas. As December 24 was not a holiday specified by the Resolution of 1885, as amended, the Acting Comptroller General by letter of December 20, 1937, advised the Secretary of the Navy that per diem employees of the Navy Department would not be entitled either to gratuity or scheduled pay for that day unless, of course, they earned the latter by working. The difficulty was that the government offices had been closed by an Executive Order whereas the Resolutions limited the allowance of holiday gratuities to a list of statutory holidays.3 The above-mentioned letter gave unquestioning recognition to the existing statutory authorization of gratuity pay for specified holidays, whether or not additionally compensated labor was performed on those days. It contained no suggestion that such payments were invalid or even unwise, except to point out that the existing law allowed such gratuities even when a holiday occurred on a nonworkday. On this point, the letter commented that 'even when any of such holidays falls on a nonworkday (such as a Saturday), such employees receive pay for the holiday when no work is performed thereon, in addition to the full week's pay otherwise earned, and double compensation for the day if work is performed thereon.' H.R.Rep.No. 2683, 75th Cong., 3d Sess. 5.
27
With this situation before him, Representative Ramspeck of the House Committee on Civil Service introduced House Joint Resolution 551 providing that the 'employees * * * who were excused from duty on December 24, 1937, by the Executive order of December 6, 1937, shall receive compensation for December 24, 1937, any law or regulation to the contrary notwithstanding.' See 83 Cong.Rec. 9466.
28
This was referred to the Civil Service Commission which returned it with the suggested substitute which later became the Resolution of 1938. The Commission explained the need for the substitute as follows:
29
'It is believed that the President had in view that the benefits of the holiday be accorded to all classes of employees to the greatest extent possible. The accounting authorities, however, have held that in the absence of specific legislation the regular employees of the Federal Government whose compensation is fixed at a rate per day, per hour, or on a piece-work basis lose pay for that day. This has resulted in discrimination against these groups of Federal employees.
30
'The proposed joint legislation provides for the payment of compensation to these employees to cover the single day, December 24, 1937; but there is the broader question involved of securing statutory authority for such payments as a general practice and thus obviate the necessity for special resolutions by Congress. Such a resolution, for example, was required last year to provide payment for these same classes of employees in Washington, D.C., who were excused from duty on January 20, 1937, the date of the inauguration of the President.
31
'It is believed that general legislation in the following phraseology would give permanent statutory authority for payments under the circumstances indicated:
32
"Hereafter, whenever regular employees of the Federal Government, whose compensation is fixed at a rate per day, per hour, or on a piece work basis, are relieved or prevented from working solely because of the occurrence of a holiday, such as New Year's Day, Washington's Birthday, Memorial Day, Fourth of July, Labor Day, Thanksgiving Day, Christmas Day, or any other day declared a holiday by Federal statute or Executive order, or any day on which the Departments and establishments of the Government are closed by Executive order, they shall receive the same pay for such days as for other days on which an ordinary day's work is performed.
33
"Sec. 2. The joint resolution of January 6, 1885 (U.S.C., title 5, sec. 86), and all other laws inconsistent or in conflict with the provisions of this Act are hereby repealed to the extent of such inconsistency or conflict." H.R.Rep.No.2683, 75th Cong., 3d Sess. 2.4
34
The letters, constituting the Committee Report, thus pointed to the following changes to be accomplished by the new Resolution:
35
1. Extend the gratuity to include not only statutory holidays but also any holidays and other nonworkdays prescribed by Executive Order.
36
2. Extend the gratuity to cover all 'regular employees of the Federal Government, whose compensation is fixed at a rate per day, per hour, or on a piece work basis * * *.' Ibid.
37
The above extensions followed the suggestion of the Civil Service Commission that the new Resolution should answer 'the broader question involved of securing statutory authority for such payments (as that of December 24, 1937) as a general practice and thus obviate the necessity for special resolutions by Congress.' Ibid.
38
The new Resolution also met the implied criticism relating to the allowance of gratuities for holidays occurring on other than workdays. It did this by expressly limiting gratuity allowances to those days on which the employees 'are relieved or prevented from working solely because of the occurrence of a holiday such as New Year's Day * * *.' (Emphasis supplied.) 52 Stat. 1246. It thus excluded holidays when the relief from work was due in part to the day not being a workday without regard to its designation as a holiday.
39
The few brief statements made by the sponsor of the Resolution, Representative Ramspeck, at the time of its adoption, confirm the view that the Resolution was merely a corrective measure intended to aid 'the lowest-paid group of employees in the Government service,' rather than a measure designed to abolish substantial benefits enjoyed by per diem laborers under a 50-year-old governmental practice.5
40
It is hardly conceivable that, if either the sponsor of this Resolution or the Committee recommending its adoption had seen in it the deprivation of pay now contended for by the Government, the sponsor or the Committee would not have mentioned that effect in the presentation of the measure. The absence of any such mention is eloquent testimony that the Resolution had no such meaning. It is equally inconceivable that Congress would unanimously reduce the pay of the Government's lowest paid employees sub silentio. Read in its context, and in the light of the explanation, made on the floor, that this Resolution sought 'simply to correct' such a situation as that which occurred on Christmas Eve, and to prevent an unintentional discrimination against per diem employees, it is difficult to read into the Resolution the meaning, contrary to their interests, for which the Government now contends.
41
The fact that, at the time the 1938 Resolution was enacted, it was the general practice of private industry to pay some type of premium pay for holidays worked emphasizes the unlikelihood of the interpretation contended for by the Government. In Kelly v. United States, 96 F.Supp. 611, 614, 119 Ct.Cl. 197, 209, the Court of Claims, in interpreting the 1938 Resolution, described the circumstances in that year as follows:
42
'With regard to its per diem and per hour employees, the so-called wage board employees, the Government is in competition with private employers, and attempts to keep its wages and working conditions in step with those in private enterprise. It is completely unthinkable that the owner of a printing shop could, by practice, or by contract, maintain the policy as to holiday pay which the Government here seeks to attribute to Congress. Such an employer might, and many employers did, in 1938, have a policy of not paying for holidays not worked. If the holiday was worked, it was paid for. Some such employers then, and most of them now (1951) have contracts with their employees providing for paid holidays, but in all such contracts there is a provision that if the holiday is in fact worked, it will be paid for again, usually at premium pay, and in addition to the holiday pay. But in no case which we have heard of, or can imagine, could an employer maintain a practice whereby an employee who worked on a holiday received merely the same pay as one who did not work.'6
43
The foregoing changes in the existing law retained its general pattern. They clarified both the classes of per diem employees entitled to a holiday gratuity, and the occasions when that gratuity was to be payable. Nowhere in the Resolution or in its legislative history is there any express statement of the Government's present contention that an employee who comes within the statutory classification of eligibility for the holiday gratuity is deprived of it if he performs some compensated labor for the Government on the holiday in question.
44
The Government emphasizes the phrase, added in 1938, which states that its regular per diem employees shall receive holiday pay 'whenever (they) are relieved or prevented from working solely because of the occurrence of a holiday * * *.' This is interpreted by the Court of Claims as eliminating gratuity pay for those holidays which occur on nonworkdays. It does this aptly because the occurrence of a holiday on a nonworkday obviously is not the sole cause preventing per diem employment on those days. The Government, however, suggests that this clause also means that if a per diem employee, who becomes entitled to gratuity pay solely because of the occurrence of a holiday on a workday, nevertheless responds to a call to work on that day, he loses the gratuity. Such an interpretation discriminates against the loyal holiday worker.
45
Moreover, such an interpretation produces the inequitable result that an employee who works on a holiday receives no more pay than an employee who is not required to work on the same holiday.
46
Concededly, this was not so before 1938. At least until then the 1885 Resolution was recognized as authorizing gratuity pay for holidays, whether or not work was performed on those days. Accordingly, in 1938, it would have been a simple thing to repeal the 1885 Resolution outright if that result were intended. Instead of doing so, the repealing section in the 1938 Resolution expressly limited itself to the inconsistencies and conflicts between, on the one hand, the new Resolution and, on the other, the 1885 Resolution and 'all other laws inconsistent or in conflict with the provisions' of the new Resolution. Such a limited repeal well reflects the above-recited legislative history. It shows the character of the new Resolution to be that of corrective legislation in the interests of the laborers. To be sure, the House Committee Report in its treatment of § 2 of the new Resolution did set forth the text of the 1885 Resolution as that of the Resolution cited in that repealing section. That recital is not sufficient to change the specifically restricted repealing clause into an outright repeal in the face of its express limitation to inconsistencies and conflicts.
47
The Resolutions of 1885 and 1938 are in pari materia and should be read together. When so read, there is no basis for treating differently the several holidays specified in the Resolutions. No 'double standard' results. The 193, Resolution expands the statutory list of holidays to include various other days that might be designated by Executive Orders. None of the original list are excluded.
48
Petitioner cites no judicial decision upholding its interpretation. The Court of Claims has twice rejected it and taken the opposite view.7
49
Petitioner cites as authority for its position the brief rulings of the Comptroller General under the 1938 Resolution. Without reviewing the material which has influenced the Court of Claims, those rulings assume, without discussion or judicial support, that the Resolution of 1938 completely repealed the Resolution of 1885. See 18 Comp.Gen. 10, 16, 186, 191 (1938). The treatment of the amendment in the publication of the United States Code is not controlling and cites no judicial authority.
50
In United States v. Kelly, 342 U.S. 193, 72 S.Ct. 213, 96 L.Ed. 222, we held that per diem employees of the Government Printing Office were entitled to the gratuity pay guaranteed by their collective-bargaining agreement. We also said expressly that the 1938 Resolution 'was silent on the subject of gratuity pay for holidays on which work was performed'. Id., 342 U.S. at page 195, 72 S.Ct. at page 215. The Kelly case thus shows that, at the very least, the gratuity policy of the 1885 Resolution is not prohibited after 1938. Accordingly, it would be consistent with that case to uphold the Court of Claims in the instant case. The collective-bargaining contract in the Kelly case was declaratory of, not contrary to, the policy of the 1885 Resolution.
51
For the foregoing reasons, the judgment of the Court of Claims should be affirmed.
1
Joint Resolution of June 29, 1938, c. 818, 52 Stat. 1246, 5 U.S.C. § 86a, 5 U.S.C.A. § 86a:
'* * * (W)henever regular employees of the Federal Government whose compensation is fixed at a rate per day, per hour, or on a piece-work basis are relieved or prevented from working solely because of the occurrence of a holiday such as New Year's Day, Washington's Birthday, Memorial Day, Fourth of July, Labor Day, Thanksgiving Day, Christmas Day, or any other day declared a holiday by Federal statute or Executive order, or any day on which the departments and establishments of the Government are closed by Executive order, they shall receive the same pay for such days as for other days on which an ordinary day's work is performed.
'Sec. 2. The joint resolution of January 6, 1885 (U.S.C., title 5, sec. 86), and all other laws inconsistent or in conflict with the provisions of this Act are hereby repealed to the extent of such inconsistency or conflict.'
2
23 Stat. 516 (1885), as amended, 24 Stat. 644 (1887), 5 U.S.C. (1934 ed.) § 86, 5 U.S.C.A. § 86, which provides:
'* * * The employees of the Navy Yard, Government Printing Office, Bureau of Printing and Engraving, and all other per diem employees of the Government on duty at Washington, or elsewhere in the United States, shall be allowed the following holidays, to wit: The 1st day of January, the 22d day of February, the day of each year which is celebrated as 'Memorial' or 'Decoration Day,' the 4th day of July, the 25th day of December, and such days as may be designated by the President as days for national thanksgiving, and shall receive the same pay as on other days.'
3
This double pay resulted from interpretation of the 1885 Resolution by the office of the Comptroller of the Treasury. 13 Comp.Dec. 40. See also, 13 Comp.Gen. 295, 297.
4
It is true that the Comptroller General's 1937 letter pointed up the discrimination between per annum and per diem employees on nonwork days. But, even though not specifically adverted to, it would seem that a similar discrimination was also apparent as to work days in that per annum employees would receive no extra pay, while per diem employees would receive not only their regular wage but an equal amount as holiday pay.
5
Moreover, the Schedule of Wages here provided for 50% additional pay for work required on holidays not included in the regular tour of duty and 125% additional for work in excess of eight hours on such days.
6
18 Comp.Gen. 10, 13; 18 Comp.Gen. 186.
7
H.J.Res. 303, 76th Cong., 1st Sess.; H.R. 1386, 77th Cong., 1st Sess.; S. 1930, 77th Cong., 1st Sess.; H.R. 6222, 77th Cong., 1st Sess.; S. 1679, 79th Cong., 2d Sess.
The policy of allowing gratuity pay for holidays worked in peacetime and of prohibiting it in wartime is reflected in a section of the Federal Employees Pay Act of 1945, 59 Stat. 298, 5 U.S.C. § 922, 5 U.S.C.A. § 922. This section provided for gratuity pay for holidays worked but was not to go into effect until the cessation of hostilities in World War II. By implication then, there was no gratuity pay allowed by statute for holidays worked during wartime.
8
Kelly also claimed under a Joint Resolution. The Resolution of 1885 provided for 'gratuity pay' for holidays for all government per diem employees. An Act of 1895, 44 U.S.C.A. § 44, referring specifically to Government Printing Office employees is substantially identical in regard to holiday pay with the 1885 Resolution. The Kelly case was considered on the basis of the 1895 Act, but the Court was not required to determine whether Kelly was entitled to any pay under that Resolution.
1
In 1887 a fifth holiday was added—Memorial Day. Joint Resolution of February 23, 1887, 24 Stat. 644. For an earlier similar provision, applicable only to employees of the Government Printing Office, see 21 Stat. 304. A subsequent like provision for such employees, the Act of January 12, 1895, 28 Stat. 601, 607, 44 U.S.C.A. § 44, was 'consistently administered as providing for gratuity pay in addition to regular compensation if the employee worked on a holiday.' United States v. Kelly, 342 U.S. 193, 195, 72 S.Ct. 213, 214.
2
See 8 Comp.Dec. 322 (1901); 13 Comp.Dec. 40 (1906); 21 Comp.Dec. 566 (1915); 22 Comp.Dec. 404 (1916); 24 Comp.Dec. 218 (1917); 24 Comp.Dec. 529 (1918); 3 Comp.Gen. 411 (1924); and 15 Comp.Gen. 809 (1936). See also, Kelly v. United States, 96 F.Supp. 611, 612—613, 119 Ct.Cl. 197, 206—207.
3
The letter of December 20, 1937, appears in full in H.R.Rep. No. 2683, 75th Cong., 3d Sess. 3—5, relating to House Joint Resolution 551, later approved June 29, 1938, and now before us.
4
For the official text of the Resolution as approved June 29, 1938, see 52 Stat. 1246, 5 U.S.C.(1952 ed.) § 86a, 5 U.S.C.A. § 86a.
5
The following comprises nearly all that was said about the Resolution on the floor of the House:
'Mr. O'Malley. * * * What does this cover?
'Mr. Ramspeck. This covers the lowest-paid group of employees in the Government service. It is those who work on a per diem basis. For instance, last Christmas Eve the President excused all Government employees from rendering any service. His Executive order, of course, applied to every employee in the Government service. Those who are working on a monthly salary got their pay for Christmas Eve, but those who work on a per diem were forced to take the day off, and they lost the day's pay.
This is simply to correct that situation.
'Mr. Collins. What does it have to do with?
'Mr. Ramspeck. It covers only those cases where the President by Executive order excuses employees from a day's work. It gives the same right to per diem employees as to the regular monthly employees.
'Mrs. Rogers of Massachusetts. This simply prevents an unintentional discrimination.
'Mr. Ramspeck. That is correct. The per diem employees are unintentionally discriminated against.' (Emphasis supplied.) 83 Cong.Rec. 9466.
6
See also, a study entitled 'Personnel Practices Governing Factory and Office Administration,' prepared in 1937 by F. Beatrice Brower for the National Industrial Conference Board, Inc., New York City. This covered about 450 industrial concerns employing wage earners totaling about 370,000. (P. 2.) Over 60% of such companies paid some type of premium or gratuity to their wage earners for work performed on Sundays or holidays, the extra pay ranging from 25% to 100%, in addition to the regular rate of pay. (Pp. 36—37.)
7
Kelly v. United States (two judges dissenting), 96 F.Supp. 611, 119 Ct.Cl. 197, aff'd on other grounds, United States v. Kelly, 342 U.S. 193, 72 S.Ct. 213, 96 L.Ed. 222; and the instant case, Bergh v. United States (one judge dissenting), 132 F.Supp. 462, 132 Ct.Cl. 564. See also, Adams v. United States, 42 Ct.Cl. 191, 212—213.
| 78
|
352 U.S. 36
77 S.Ct. 116
1 L.Ed.2d 99
Herbert BROWNELL, Jr., Attorney General of the United States, as Successor to the Alien Property Custodian, Petitioner,v.The CHASE NATIONAL BANK OF THE CITY OF NEW YORK, as Trustee Under Indenture, Etc., et al.
No. 24.
Argued Oct. 16, 17, 1956.
Decided Nov. 19, 1956.
Mr. George B. Searls, Washington, D.C., for petitioner.
Mr. Thomas A. Ryan, New York City, for respondent trustee.
Mr. Samuel Anatole Lourie, New York City, for infant-respondents Hans Dietrich Schaefer et al.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
The question in the case is whether petitioner, by virtue of a vesting order issued under § 5 of the Trading with the Enemy Act, as amended, 40 Stat. 411, 50 U.S.C.App. § 5, 50 U.S.C.A.Appendix, § 5, is entitled to the res of a trust established in 1928 by one Cobb and administered by respondent under an indenture. The trust was created for the benefit of the descendants of Bruno Reinicke who, by reason of his powers over the trust and his ownership of the right of reversion, was the real settlor.
2
In 1945, when this Nation was at war with Germany, the Alien Property Custodian issued an order vesting 'all right, title, interest and claim of any kind or character whatsoever' of the beneficiaries of the trust, declaring that they were nationals of Germany. Subsequently the Custodian (for whom the Attorney General was later substituted) intervened in an action brought by the trustee in the New York courts for a construction of the indenture and for an accounting. Relief sought by that intervention was that the income of the trust be paid to the Attorney General and that the powers reserved to the settlor be held to have passed by virtue of the vesting order to the Attorney General. We are also advised by the report of the case in the Court of Appeals that the Attorney General also claimed that, if the vesting order had not transferred the settlor's powers to the Attorney General, 'then the trust had failed and all of the trust property should pass to the Attorney General under the vesting order as being property of alien enemies.' Chase National Bank of City of New York v. McGrath, 301 N.Y. 602, 603—604, 93 N.E.2d 495.
3
The New York Supreme Court denied the relief asked by the Attorney General, holding he was not entitled to the income of the trust, that he had not succeeded to the powers of the settlor, and that those powers were vested in the trustee as long as the settlor was barred from asserting them. On appeal the Appellate Division affirmed. Chase National Bank of City of New York v. McGrath, 276 App.Div. 831, 93 N.Y.S.2d 724. The Court of Appeals in turn affirmed. Chase National Bank of City of New York v. McGrath, 301 N.Y. 602, 93 N.E.2d 495. No review of that order was sought here.
4
Some years passed, when, in 1953, the Attorney General amended the vesting order by undertaking to appropriate 'all property in the possession, custody or control' of the trustee.* In a suit in the New York courts he asked, among other things, that the principal of the trust be transferred to him. The Supreme Court of New York denied the relief. The Appellate Division affirmed without opinion. Chase National Bank of City of New York v. Reinicke, 286 App.Div. 808, 143 N.Y.S.2d 623. The Court of Appeals denied leave to appeal. Chase National Bank of City of New York v. Reinicke, 309 N.Y. 1030, 129 N.E.2d 790. The case is here on certiorari, 350 U.S. 964, 76 S.Ct. 436.
5
We do not reach the several questions presented under the Trading with the Enemy Act for we are of the view that the principles of res judicata require an affirmance. In the first litigation, the Attorney General sought to reach the equitable interests in the trust and the powers of the settlor. When the Attorney General now seeks the entire bundle of rights, he is claiming for the most part what was denied him in the first suit. That is not all. In the first suit he claimed that if he were denied the powers which the settlor had over the trust, the trust must fail and all the trust property must be transferred to him. In other words, the Attorney General tendered in the first suit his claim to the entire property. Cf. Young v. Higbee Co., 324 U.S. 204, 208 209, 65 S.Ct. 594, 596—597, 89 L.Ed. 890. Under familiar principles of res judicata, the claim so tendered may not be relitigated. Cromwell v. County of Sac, 94 U.S. 351, 352, 24 L.Ed. 195. Tait v. Western Maryland R. Co., 289 U.S. 620, 623, 53 S.Ct. 706, 707, 77 L.Ed. 1405. If he was not content with the first ruling, his remedy was by certiorari to this Court. Angel v. Bullington, 330 U.S. 183, 189, 67 S.Ct. 657, 660, 91 L.Ed. 832. Having failed to seek and obtain that review, he is barred from relitigating the issues tendered in the first suit.
6
Affirmed.
7
Mr. Justice CLARK and Mr. Justice HARLAN took no part in the consideration or decision of the case.
*
The state of war between this country and Germany was declared ended by the Joint Resolution of October 19, 1951, 65 Stat. 451. That Resolution contained, however, a proviso that all property, which, prior to January 1, 1947, was subject to seizure under the Act, continued to be subject to the Act. The 1953 vesting order preceded by a few days the termination of the vesting program of German-owned properties announced by the President on April 17, 1953.
| 89
|
352 U.S. 77
77 S.Ct. 172
1 L.Ed.2d 140
UNITED STATES of America, Petitioner,v.The CHESAPEAKE & OHIO RAILWAY COMPANY.
No. 19.
Argued Oct. 15, 1956.
Decided December 3, 1956.
Mr. Morton Hollander, Washington, D.C., for petitioner.
Mr. Meade T. Spicer, Jr., Richmond, Va., for respondent.
Mr. Justice HARLAN delivered the opinion of the Court.
1
This case presents questions similar to those involved in United States v. Western Pacific R. Co., 352 U.S. 59, 77 S.Ct. 161.
2
In 1941 and 1942 the Government shipped from Pontiac, Michigan, to Newport News, Virginia, over the respondent's lines, various military supplies destined for China, via the port of Rangoon, Burma. This intended exportation was frustrated by the fall of Rangoon to Japanese military forces on March 8, 1942. The Government therefore took possession of the shipments at Newport News, reshipped them about three months later to storage centers in Pennsylvania and New Jersey, and more than a year later again reshipped some of the goods to various points on the Pacific Coast, whence they were exported to Calcutta, India. Had the original purpose of a shipment to China been accomplished, the export rate provided in Item 23030 of Tariff No. 218—M1 would have applied to the transportation between Pontiac and Newport News. However, when that shipment was frustrated, the respondent billed the Government at the higher domestic rate.2 The Government paid these bills as rendered, but subsequently, on post-audit by the General Accounting Office, readjusted the charges to the lower export rate, deducting the difference from subsequent bills of the carrier for other transportation services.3 Thereafter the respondent sued the United States in the District Court for the Eastern District of Virginia under the Tucker Act4 to recover the amount of these deductions. The District Court gave judgment for the respondent,5 the Court of Appeals affirmed,6 and we granted certiorari.7
3
The Court of Appeals, following its earlier decision in United States v. Chesapeake & Ohio R. Co., 4 Cir., 215 F.2d 213, held 'that the intention to export to China was abandoned and that the movement which began at Pontiac, Michigan, as an export was converted by the shipper into a domestic shipment'; hence the domestic rate applied. It further held that the District Court had properly denied the Government's request for a referral to the Interstate Commerce Commission of the question whether the domestic rate, if applied to these shipments, would be reasonable. As to this the Court of Appeals said that the 'question was not the reasonableness of rates, which everyone conceded to be reasonable, but which rate was applicable to the shipment under the circumstances of the case, a question which the court was competent to decide.' Therefore, it concluded that there were no 'administrative questions' for the Commission to determine. Further, without questioning the timeliness of the respondent's suit under the Tucker Act,8 the Court of Appeals held that in any event referral to the Commission of the question of the reasonableness of the domestic tariff as applied to these shipments was barred by the two-year statute of limitations of the Interstate Commerce Act.9
4
Unlike the Court of Claims in United States v. Western Pacific R. Co., supra, the Court of Appeals, correctly we think, regarded the questions of whether the domestic tariff applied to these shipments, and whether it was reasonable if so applied, as simply two ways of stating the same underlying problem. Hence we face the same question as the one we have dealt with in the Western Pacific case, supra, namely: does the issue of tariff construction, which the Court of Appeals regarded as one for the court, involve such acquaintance with rate-making and transportation factors as to make the issue initially one for the Interstate Commerce Commission, under the doctrine of primary jurisdiction? In this instance we cannot say positively whether or not there should have been a referral to the Commission. The Government, treating the issues of 'construction' and 'reasonableness' as separable, did not question the Court of Appeals' holding that the domestic tariff applied, but argued only that the tariff was unreasonable as applied to these shipments. The parties, therefore, have not briefed or argued the factors making for or against the application of the domestic rather than the export tariff. Consequently, we do not know what kinds of factors are involved, and we therefore cannot say on this record whether the issue of tariff construction should have been referred to the Commission. We think this question should be determined by the Court of Appeals upon a full record, which would no doubt include consideration of the factors shown by the record in the earlier case which it followed here,10 and which is not before us.11 For the reasons given in our opinion in the Western Pacific case, supra, we hold that referral to the Commission would not be barred by the § 16(3) statute of limitations.
5
We shall therefore reverse the judgment below and remand the case to the Court of Appeals for further proceedings not inconsistent with this opinion and with our opinion in United States v. Western Pacific R. Co., supra. It is so ordered.
6
Reversed and remanded.
7
Mr. Justice DOUGLAS dissents from a reference of these matters to the Interstate Commerce Commission, since he is of the view that the principles of Great Northern R. Co. v. Merchants Elevator Co., 259 U.S. 285, 42 S.Ct. 477, 66 L.Ed. 943, are applicable here.
8
Mr. Justice REED and Mr. Justice BRENNAN took no part in the consideration or decision of this case.
1
'Application of Export Rates to North Atlantic Seaboard Ports of Export
'The rates named in this tariff, or as same may be amended, and designated as 'Export Rates' will apply only on traffic which does not leave the possession of the carrier, delivered by the Atlantic Port Terminal carriers direct to the steamer or steamer's dock upon arrival at the port or after storage or transit has been accorded by the port carrier at the port under tariffs which permit the application of the export rates, and also on traffic delivered to the party entitled to receive it at the carrier's seaboard stations to which export rates apply, which traffic is handled direct from carriers' stations to steamship docks and on which required proof of exportation is given. (C.F.A.Inf. 8179, 13607)'
2
Central Freight Association, Freight Tariff No. 490—A.
3
This procedure was authorized by § 322 of the Transportation Act of September 18, 1940, 54 Stat. 955, 49 U.S.C. § 66, 49 U.S.C.A. § 66.
4
28 U.S.C. § 1346(a)(2), 28 U.S.C.A. § 1346(a)(2).
5
The District Court filed no written opinion. It rendered a short oral opinion which appears at pages 40—41 of the record.
6
224 F.2d 443, 444.
7
350 U.S. 953, 76 S.Ct. 343.
8
The respondent's cause of action accrued no later than the summer of 1946, when the Government deducted the difference between the domestic rate and the export rate. The respondent filed its suit on March 10, 1952. On the assumption that the Tucker Act applies see our opinion in the Western Pacific case, supra, 352 U.S. 59, 77 S.Ct. 161, the suit was timely brought.
9
24 Stat. 384, as amended, 49 U.S.C. § 16(3), 49 U.S.C.A. § 16(3).
10
215 F.2d 213.
11
The Government suggests that in comparable situations the Commission has decided that the export rate should apply. See C. B. Fox Co. v. Gulf, Mobile & Ohio R. Co., 246 I.C.C. 561; River Petroleum Corp. v. Yazoo & M.V.R. Co., 258 I.C.C. 1; Mid-Continent Petroleum Corp. v. Illinois Central R. Co., 258 I.C.C. 422; Products-From-Sweden, Inc. v. Lehigh Valley R. Co., 263 I.C.C. 760. Respondent, in turn, cites California Texas Oil Co. v. Bessemer & Lake Erie R. Co., 264 I.C.C. 147; Pacific Chemical & Fertilizer Co. v. Pennsylvania R. Co., 268 I.C.C. 468; and War Materials Reparations Cases, 294 I.C.C. 5. We express no opinion as to the effect of these decisions, for we think their relevancy to the situation at hand should be left to the Court of Appeals in the first instance. See our opinion in the Western Pacific case, 352 U.S. 59, 77 S.Ct. 161.
| 89
|
352 U.S. 59
77 S.Ct. 161
1 L.Ed.2d 126
The UNITED STATES, Petitioner,v.The WESTERN PACIFIC RAILROAD COMPANY et al.
No. 18.
Argued Oct. 15, 1956.
Decided Dec. 3, 1956.
Mr. Morton Hollander, Washington, D.C., for petitioner.
Mr. Frederick Bernays Wiener, Washington, D.C., for respondents
Mr. Justice HARLAN delivered the opinion of the Court.
1
The three respondent railroads each sued in the Court of Claims to recover from the United States as shipper the difference between the tariff rates actually paid and those allegedly due on 211 Army shipments of steel aerial bomb cases filled with napalm gel.1 Approximately 200 of the shipments were made over the lines of respondents Bangor and Seaboard in 1944; the remainder were carried by respondent Western Pacific in 1948 and 1950.
2
Napalm gel is gasoline which has been thickened by the addition of aluminum soap powder. The mixture is inflammable but not self-igniting. In a completed incendiary bomb the napalm gel is ignited by white phosphorus contained in a burster charge, which in turn is fired by a fuse. These shipments, however, involved only the steel casings and the napalm gel; burster and fuse had not yet been added.
3
The carriers billed the Government at the high first-class rates established in Item 1820 of Consolidated Freight Classification No. 17 for 'incendiary bombs.' Pursuant to § 322 of the Transportation Act of 1942,2 the Government paid the bills of the Bangor and the Seaboard as presented; on post-audit, however, the General Accounting Office made deductions against these respondents' subsequent bills on other shipments, on the ground that the shipments in question should have been carried at the lower, fifth-class, rate applicable to gasoline in steel drums.3 The bills of the Western Pacific were initially paid at the lower rate. Respondents thereupon brought the present suits to recover the difference between the bills as rendered and as paid in the case of the Western Pacific, and the amount of the deductions in the other two cases.
4
The Government defended on three grounds: (1) that Item 1820 was inapplicable because absence of burster and fuse deprived these bombs of the essential characteristics of 'incendiary bombs,' and hence no additional sums were due; (2) that if this tariff item was held to govern, the tariff would be unreasonable as applied to these shipments, and that as to this issue the court proceedings should be suspended and the matter referred to the Interstate Commerce Commission; and (3) that in any event the Bangor and Seaboard were estopped from charging the '1820' rate.
5
The Court of Claims, relying on its earlier decision in Union Pacific R. Co. v. United States, 111 F.Supp. 266, 125 Ct.Cl. 390,4 entered summary judgment for respondents, two judges dissenting.5 It held that the shipments in question were 'incendiary bombs' within the meaning of Item 1820 of the tariff and thus entitled to the higher rate. In addition, while seemingly recognizing the Government's right to have the defense of unreasonableness determined by the Interstate Commerce Commission, the court ruled that the running of the two-year period of limitations provided by § 16(3) of the Interstate Commerce Act6 cut off the right of referral to the Commission. Lastly, the court overruled the defense of estoppel as to the respondents Bangor and Seaboard. Because of the importance of these questions in the administration of the Interstate Commerce Act, and alleged conflict among the lower courts on the issue of limitations, we granted certiorari. 350 U.S. 953, 76 S.Ct. 342.
I.
6
We are met at the outset with the question of whether the Court of Claims properly applied the doctrine of primary jurisdiction in this case; that is, whether it correctly allocated the issues in the suit between the jurisdiction of the Interstate Commerce Commission and that of the court. In the view of the court below, the case presented two entirely separate questions. One was the question of the construction of the tariff—whether Item 1820 was applicable to these shipments. The second was the question of the reasonableness of that tariff, if so applied. The Court of Claims assumed, as it had in the Union Pacific case, supra, that the first of these—whether the '1820' rate applied—was a matter simply of tariff construction and thus properly within the initial cognizance of the court.7 The second—the reasonableness of the tariff as applied to these shipments—it seemed to regard as being within the initial competence of the Interstate Commerce Commission. Before this Court neither side has questioned the validity of the lower court's views in these respects. Nevertheless, because we regard the maintenance of a proper relationship between the courts and the Commission in matters affecting transportation policy to be of continuing public concern, we have been constrained to inquire into this aspect of the decision. We have concluded that in the circumstances here presented the question of tariff construction, as well as that of the reasonableness of the tariff as applied, was within the exclusive primary jurisdiction of the Interstate Commerce Commission.
7
The doctrine of primary jurisdiction, like the rule requiring exhaustion of administrative remedies, is concerned with promoting proper relationships between the courts and administrative agencies charged with particular regulatory duties. 'Exhaustion' applies where a claim is cognizable in the first instance by an administrative agency alone; judicial interference is withheld until the administrative process has run its course. 'Primary jurisdiction,' on the other hand, applies where a claim is originally cognizable in the courts, and comes into play whenever enforcement of the claim requires the resolution of issues which, under a regulatory scheme, have been placed within the special competence of an administrative body; in such a case the judicial process is suspended pending referral of such issues to the administrative body for its views. General American Tank Car Corp. v. El Dorado Terminal Co., 308 U.S. 422, 433, 60 S.Ct. 325, 331, 84 L.Ed. 361.
8
No fixed formula exists for applying the doctrine of primary jurisdiction. In every case the question is whether the reasons for the existence of the doctrine are present and whether the purposes it serves will be aided by its application in the particular litigation. These reasons and purposes have often been given expression by this Court. In the earlier cases emphasis was laid on the desirable uniformity which would obtain if initially a specialized agency passed on certain types of administrative questions. See Texas & Pacific R. Co. v. Abilene Cotton Oil Co., 204 U.S. 426, 27 S.Ct. 350, 51 L.Ed. 553. More recently the expert and specialized knowledge of the agencies involved has been particularly stressed. See Far East Conference v. United States, 342 U.S. 570, 72 S.Ct. 492, 96 L.Ed. 576. The two factors are part of the same principle,
9
'now firmly established, that in cases raising issues of fact not within the conventional experience of judges or cases requiring the exercise of administrative discretion, agencies created by Congress for regulating the subject matter should not be passed over. This is so even though the facts after they have been appraised by specialized competence serve as a premise for legal consequences to be judicially defined. Uniformity and consistency in the regulation of business entrusted to a particular agency are secured, and the limited functions of review by the judiciary are more rationally exercised, by preliminary resort for ascertaining and interpreting the circumstances underlying legal issues to agencies that are better equipped than courts by specialization, by insight gained through experience, and by more flexible procedure.' Id., 342 U.S. at pages 574—575, 72 S.Ct. at page 494.
10
The doctrine of primary jurisdiction thus does 'more than prescribe the mere procedural timetable of the lawsuit. It is a doctrine allocating the law-making power over certain aspects' of commercial relations. 'It transfers from court to agency the power to determine' some of the incidents of such relations.8
11
Thus the first question presented is whether effectuation of the statutory purposes of the Interstate Commerce Act requires that the Interstate Commerce Commission should first pass on the construction of the tariff in dispute here; this, in turn, depends on whether the question raises issues of transportation policy which ought to be considered by the Commission in the interests of a uniform and expert administration of the regulatory scheme laid down by that Act. Decision is governed by two earlier cases in this Court. In Texas & Pacific R. Co. v. American Tie & Timber Co., 234 U.S. 138, 34 S.Ct. 885, 58 L.Ed. 1255, a shipper attempted to ship oak railroad ties under a tariff for 'lumber.' The carrier rejected them, urging that such ties were not lumber. In a damage action expert testimony was received on the question. This Court, however, held that the Interstate Commerce Commission alone could resolve the question. The effect of the holding is clear: the courts must not only refrain from making tariffs, but, under certain circumstances, must decline to construe them as well. A particularization of such circumstances emerged in Great Northern R. Co. v. Merchants Elevator Co., 259 U.S. 285, 42 S.Ct. 477, 66 L.Ed. 943. There the Court held that where the question is simply one of construction the courts may pass on it as an issue 'solely of law.' But where words in a tariff are used in a peculiar or technical sense, and where extrinsic evidence is necessary to determine their meaning or proper application, so that 'the inquiry is essentially one of fact and of discretion in technical matters,' then the issue of tariff application must first go to the Commission. The reason is plainly set forth: such a 'determination is reached ordinarily upon voluminous and conflicting evidence, for the adequate appreciation of which acquaintance with many intricate facts of transportation is indispensable, and such acquaintance is commonly to be found only in a body of experts.' Id., 259 U.S. at page 291, 42 S.Ct. at page 479. We must therefore decide whether a determination of the meaning of the term 'incendiary bomb' in Item 1820 involves factors 'the adequate appreciation of which' presupposes an 'acquaintance with many intricate facts of transportation.' We conclude that it does.
12
A tariff is not an abstraction. It embodies an analysis of the costs incurred in the transportation of a certain article and a decision as to how much should, therefore, be charged for the carriage of that article in order to produce a fair and reasonable return. Complex and technical cost-allocation and accounting problems must be solved in setting the tariff initially. In the case of 'incendiary bombs,' since it is expensive to take the elaborate safety precautions necessary to carry such items in safety, evidently there must have been calculation of the costs of handling, supervising and insuring an inherently dangerous cargo. In other words, there were obviously commercial reasons why a higher tariff was set for incendiary bombs than for, say, lumber. It therefore follows that the decision whether a certain item was intended to be covered by the tariff for incendiary bombs involves an intimate knowledge of these very reasons themselves. Whether steel casings filled with napalm gel are incendiary bombs is, in this context, more than simply a question of reading the tariff language or applying abstract 'rules' of construction. For the basic issue is how far the reasons justifying a high rate for the carriage of extra-hazardous objects were applicable to the instant shipment. Do the factors which make for high costs and therefore high rates on incendiary bombs also call for a high rate on steel casings filled with napalm gel? To answer that question there must be close familiarity with these factors. Such familiarity is possessed not by the courts but by the agency which had the exclusive power to pass on the rate in the first instance. And, on the other hand, to decide the question of the scope of this tariff without consideration of the factors and purposes underlying the terminology employed would make the process of adjudication little more than an exercise in semantics.
13
The main thrust of the Government's argument on the construction question went to the fact that the shipments here involved were not as hazardous as contemplated by the term 'incendiary bomb' as used in the tariff, and that therefore the tariff should not be construed to cover them.9 Similarly, the dissenting judges below emphasized the absence from the shipments of the commercial factors which call for a high rate on incendiary bombs: 'If the reason for the high freight rate is the incendiary quality of the freight, and if the freight does not have the incendiary quality, the reason for the high rate vanishes and the rate should vanish with it.' 131 F.Supp. at page 921, 132 Ct.Cl. at page 118. The difficulty with this line of argument is that we do not know whether the 'incendiary quality of the freight' was in fact the reason for the high rate, still less whether that was the only reason and how much weight should be assigned to it. Courts which do not make rates cannot know with exactitude the factors which go into the rate-making process. And for the court here to undertake to fix the limits of the tariff's application without knowledge of such factors, and the extent to which they are present or absent in the particular case, is tantamount to engaging in judicial guesswork. It was the Commission and not the court which originally determined why incendiaries should be transported at a high rate. It is thus the Commission which should determine whether shipments of napalm gel bombs, minus bursters and fuses, meet those requirements; that is, whether the factors making for certain costs and thus a certain rate on incendiaries are present in the carriage of such incompleted bombs.
14
This conclusion is fortified by the artificiality of the distinction between the issues of tariff construction and of the reasonableness of the tariff as applied, the latter being recognized by all to be one for the Interstate Commerce Commission. For the Government's thesis on the issue of reasonableness is not that the rate on incendiary bombs is, in general, too high. It argues only that the rate 'as applied' to these particular shipments is too high—i.e., that since the expenses which have to be met in shipping incendiaries have not been incurred in this case, the carriers will be making an unreasonable profit on these shipments. This seems to us to be but another way of saying that the wrong tariff was applied. In both instances the issue is whether the factors which call for a high rate on incendiary bomb shipments are present in a shipment of bomb casings full of napalm gel but lacking bursters and fuses. And the mere fact that the issue is phrased in one instance as a matter of tariff construction and in the other as a matter of reasonableness should not be determinative on the jurisdictional issue. To hold otherwise would make the doctrine of primary jurisdiction an abstraction to be called into operation at the whim of the pleader.10
15
By no means do we imply that matters of tariff construction are never cognizable in the courts. We adhere to the distinctions laid down in Great Northern R. Co. v. Merchants Elevator Co., supra, which call for decision based on the particular facts of each case. Certainly there would be no need to refer the matter of construction to the Commission if that body, in prior releases or opinions, has already construed the particular tariff at issue or has clarified the factors underlying it. See Crancer v. Lowden, 315 U.S. 631, 62 S.Ct. 763, 86 L.Ed. 1077. And in many instances construing the tariff does not call for examination of the underlying cost-allocation which went into the making of the tariff in the first instance. We say merely that where, as here, the problem of cost-allocation is relevant, and where therefore the questions of construction and reasonableness are so intertwined that the same factors are determinative on both issues, then it is the Commission which must first pass on them.
16
We hold, therefore, that both the issues of tariff construction and the reasonableness of the tariff as applied were initially matters for the Commission's determination.
II.
17
We come then to the question of whether referral of these issues to the Commission was barred by the two-year period of limitation contained in § 16(3) of the Interstate Commerce Act. We hold that it was not.
18
Section 16(3)(a) provides that 'all actions at law by carriers subject to this chapter for recovery of their charges * * * shall be begun within two years from the time the cause of action accrues, and not after.'11 This provision makes it clear that where a carrier sues a private shipper the action must be brought within two years. However, the Tucker Act, 28 U.S.C. § 2501, 28 U.S.C.A. § 2501, provides that 'every claim of which the Court of Claims has jurisdiction shall be barred unless the petition thereon is filed * * * within six years after such claim first accrues.' Relying on the broad language of the latter act, the Court of Claims has, since 1926, consistently held that § 16(3) does not apply to suits by carriers to recover alleged undercharges from the United States as shipper. Southern Pac. Co. v. United States, 62 Ct.Cl. 391; Seaboard Air Line R. Co. v. United States, 83 F.Supp. 1012, 113 Ct.Cl. 437; Union Pacific R. Co. v. United States, 86 F.Supp. 907, 114 Ct.Cl. 714. The present suits were thus held timely brought,12 even though more than two years had elapsed since the accrual of the cause of action.13 However, the Court of Claims held that the two-year limitation of § 16(3) did bar the Government from obtaining a reference of its defense of unreasonableness to the Interstate Commerce Commission.14 Presumably it would have ruled likewise as to the issue of tariff construction had it regarded that question as lying initially within the competence of the Commission. In other words, the holding below was that the United States can be sued for six years but can raise certain defenses only if the suit is brought in the first two of those years.
19
We may assume, without deciding, that the Government would have been barred by § 16(3) from filing an affirmative suit before the Commission to recover overcharges from a carrier. Nevertheless we do not think that the statute operates to bar reference to the Commission of questions raised by way of defense in suits which are themselves timely brought. Respondents in effect ask us to hold that a suit may be brought for six years but that certain defenses thereto may be raised only for two years. Only the clearest congressional language could force us to a result which would allow a carrier to recover unreasonable charges with impunity merely by waiting two years before filing suit.
20
Section 16(3) does not deal with referral of questions to the Commission incident to judicial proceedings. On its face it has to do only with the commencement of actions or reparation proceedings before the Commission. There is therefore no language which militates against the conclusion that the statute does not apply to referrals. More important, the basic policy behind statutes of limitations has no relevance to the situation here. The purpose of such statutes is to keep stale litigation out of the courts. They are aimed at lawsuits, not at the consideration of particular issues in lawsuits. Here the action was already in court and held to have been brought in time. To use the statute of limitations to cut off the consideration of a particular defense in the case is quite foreign to the policy of preventing the commencement of stale litigation. We think it would be incongruous to hold that once a lawsuit is properly before the court, decision must be made without consideration of all the issues in the case and without the benefit of all the applicable law. If this litigation is not stale, then no issue in it can be deemed stale.
21
It is argued that this Court has construed § 16(3) as 'jurisdictional' and that the Commission is therefore barred absolutely from hearing questions as to the reasonableness of rates arising in suits brought after two years, whether such questions come to the Commission by way of referral or in an original suit. Reliance is placed upon A. J. Phillips Co. v. Grand Trunk Western R. Co., 236 U.S. 662, 35 S.Ct. 444, 59 L.Ed. 774; William Danzer & Co. v. Gulf & S.I.R. Co., 268 U.S. 633, 45 S.Ct. 612, 69 L.Ed. 1126; Midstate Horticultural Co. v. Pennsylvania R. Co., 320 U.S. 356, 64 S.Ct. 128, 88 L.Ed. 96. But these cases all dealt with affirmative claims for the recovery of transportation charges, and not with referrals incident to suits which were originally brought in time. The teaching of the Midstate case, for instance, is that the running of the statute destroys the right to affirmative recovery as well as the remedy, so that the period of limitations cannot be waived by the parties. But here the Government is not asserting a right to affirmative recovery. It is seeking only to have adjudicated questions raised by way of defense. It is therefore irrelevant whether the statute of limitations is 'jurisdictional' or not; the question would still remain whether Congress intended it to apply to referrals as well as to affirmative suits. Nor does Morrisdale Coal Co. v. Pennsylvania R. Co., 230 U.S. 304, 33 S.Ct. 938, 57 L.Ed. 1494, help the respondents. There again the statute of limitations was invoked against a plaintiff in order to bar an affirmative claim which was untimely filed. A coal shipper had sued a carrier for damages arising out of the alleged discriminatory allotment of railroad cars for its use. Stating that the propriety of the carrier's method of allotment, even though incident to a damage action, was cognizable only by the Commission, and that redress there was governed by the two-year statute of limitations, the Court held that the statute could not be evaded by filing suit in the District Court, rather than before the Commission, and then having the barred claim adjudicated by referral to the latter. In effect the holding was that the plaintiff had invoked the wrong tribunal, and that since limitations barred suit before the correct tribunal no referral could be made to the latter. Morrisdale must be limited to its peculiar facts, and we shall not extend it to bar the referral of defenses in actions properly and timely brought, as the Court of Claims has held this one was.15
22
We are told that the Government can protect itself, when it believes it has been charged an unreasonable rate, by filing an affirmative claim for reparations with the Commission within the two-year period provided by § 16(3). But Congress has relieved the Government from filing such anticipatory suits by expressly authorizing the General Accounting Office to deduct overpayments from subsequent bills of the carrier if, on post-audit, it finds that the United States has been overcharged.16 This right was thought to be a necessary measure to protect the Government, since carriers' bills must be paid on presentation and before audit. On respondents' theory the Government could invoke this right only at the peril of losing its defenses in a later suit by the carrier. Evidently this was not the purpose of Congress in authorizing unilateral set-off.17
23
We hold, therefore, that the limitation of § 16(3) does not bar a reference to the Interstate Commerce Commission of questions raised by way of defense and within the Commission's primary jurisdiction, as were these questions relating to the applicable tariff.
III.
24
There remains the question of whether the Court of Claims properly dismissed the Government's defense of estoppel as to the respondents Bangor and Seaboard. We deal with it now because that defense would be reached should the further proceedings below, which must follow in consequence of what we have already said, result in adherence to the view that Item 1820 applies to these shipments.18
25
The Government's claim is that the Bangor and Seaboard were estopped from charging the '1820' rate because of the Army's reliance on a ruling of the Official Classification Committee, a railroad tariff agency to which these two respondents belonged, that this type of napalm gel bomb shipment would be carried at a lower rate. The Court of Claims rejected this defense because (1) the ruling was later withdrawn by the Committee; (2) the Government had shown no detrimental reliance on the ruling; (3) it had paid the high rate billed for all shipments; and (4) neither carrier had acquiesced in the Committee's ruling.
26
We think that the Court of Claims erred in disposing of this defense by summary judgment. It appears to be undisputed that the ruling in question was not rescinded until after all of these shipments had been made.19 The Government's affidavits in opposition to the motion for summary judgment were, in our opinion, sufficient to entitle it to an opportunity to prove reliance and detriment. The fact that the Government paid the carrier's bills as rendered is without significance in light of § 322 of the Transportation Act, supra, requiring payment 'upon presentation' of such bills and postponing final settlement until audit. And the question whether the Official Classification Committee had authority to bind these two carriers to acceptance of a lower rate presents issues of fact which must be tried. Nor, unlike the case of a private shipper, do we think that the defense of estoppel is unavailable to the Government. See 49 U.S.C. § 22, 49 U.S.C.A. § 22. Cf. Oregon-Wash. R. Co. v. United States, 255 U.S. 339, 41 S.Ct. 329, 65 L.Ed. 677; Western Pac. R. & N. Co. United States, 255 U.S. 349, 41 S.Ct. 332, 65 L.Ed. 671.20 We conclude that the Government should have an opportunity to prove estoppel, without any intimation, of course, as to whether it will be able to establish the defense.
27
The judgment below must be reversed and the case remanded to the Court of Claims for further proceedings not inconsistent with this opinion. It is so ordered.
28
Reversed and remanded.
29
Mr. Justice DOUGLAS dissents from a reference of these matters to the Interstate Commerce Commission, since he is of the view that the principles of Great Northern R. Co. v. Merchants Elevator Co., 259 U.S. 285, 42 S.Ct. 477, 66 L.Ed. 943, are applicable here.
30
Mr. Justice REED and Mr. Justice BRENNAN took no part in the consideration or decision of this case.
1
The suits were brought under the Tucker Act, 28 U.S.C. § 1491, 28 U.S.C.A. § 1491.
2
54 Stat. 955, 49 U.S.C. § 66, 49 U.S.C.A. § 66. This section provides: 'Payment for transportation of the United States mail and of persons or property for or on behalf of the United States by any common carrier subject to the Interstate Commerce Act, as amended, or the Civil Aeronautics Act of 1938, shall be made upon presentation of bills therefor, prior to audit or settlement by the General Accounting Office, but the right is hereby reserved to the United States Government to deduct the amount of any overpayment to any such carrier from any amount subsequently found to be due such carrier.'
3
It is not entirely clear from the record just what rate the Government believes is applicable to these shipments. It seems to concede that Item 1895 of Consolidated Freight Classification No. 17, covering 'Empty Aerial Bombs,' does not apply, although this was the original classification assigned to such shipments by the Official Classification Committee, a railroad tariff agency. The essence of the Government's position seems to be that these shipments, being nonincendiary, were a mere combination of gasoline, napalm thickener, and steel casings. Since these three items, standing alone, are all carried at the fifth-class rate, the Government urges that the 'combination rule' should apply and the articles be carried at the same fifth-class rate under Rule 18 of Consolidated Freight Classification No. 17.
4
In that case the Court of Claims held Item 1820 applicable to shipments similar to those involved here. The Government did not seek review of that decision.
5
131 F.Supp. 919, 132 Ct.Cl. 115. The dissenters were Judge Madden and Chief Judge Jones.
6
24 Stat. 384, as amended, 49 U.S.C. § 16(3), 49 U.S.C.A. § 16(3).
7
The Court of Claims stated in the Union Pacific case, 111 F.Supp. at page 268, 125 Ct.Cl., at page 393: 'At the outset, it should be noted that while this court has no rate-making functions * * * the construction and application of published rates and classifications are proper matters for the courts as well as for the Interstate Commerce Commission.'
8
Jaffe, Primary Jurisdiction Reconsidered, 102 Univ.Pa.L.Rev. 577, 583—584 (1954).
9
In response to the motion for summary judgment the Government presented affidavits by chemical engineers stating that napalm gel is not incendiary. But these affidavits become meaningful only if the court knows the precise relevance of the incendiary quality of the shipments to the setting of the rate.
10
The artificiality of trying to separate the issue of 'construction' from that of 'reasonableness as applied' is illustrated by the Court of Claims' holding in the Union Pacific case, supra. There, after holding that the absence of bursters and fuses did 'not affect the identity of the articles' as incendiary bombs, the court went on to say that 'it may well be that a lower tariff rate should apply to the carriage of the less hazardous incendiary bomb (one without burster and fuse). This question is not within our jurisdiction, however, as the question of the reasonableness of rates is a matter entrusted by Congress solely to the Interstate Commerce Commission.' 111 F.Supp. at page 268, 125 Ct.Cl. at pages 393, 394. Similarly, the Government here concedes that the question of hazard 'goes to the issue of reasonableness,' although arguing that it is 'also relevant to the question of tariff interpretation, for, like any other instrument, a tariff is to be read in the light of its known purposes and in a manner which avoids unnecessary and gross unfairness.'
11
24 Stat. 384, as amended, 49 U.S.C. § 16(3)(a), 49 U.S.C.A. § 16(3)(a).
12
The suits were instituted in 1954. In the Western Pacific case the carrier's claims accrued in 1948 and 1950, when the United States paid the lower rate instead of the '1820' rate for which it was billed. As to the Bangor and Seaboard cases, where the United States initially paid the '1820' rate as billed (presumably in 1944 when the shipments were made), and subsequently readjusted that rate on post-audit, it is impossible to say when the claims accrued as the record is silent as to when the post-audit readjustment was made.
13
Although questioning the soundness of this ruling which subjects carriers' claims agaisnt the United States as shipper claims against the United States as shipper than that applicable to their claims against other shippers, the Government has not challenged it here. We therefore do not pass on it.
14
The opinion of the Court of Claims does not expressly refer to the two-year period of § 16(3). The cases cited by the court, however, make it clear that it had in mind that provision, probably § 16(3)(c), which reads: 'For recovery of overcharges action at law shall be begun or complaint filed with the commission against carriers subject to this chapter within two years from the time the cause of action accrues, and not after * * *.'
15
The fact that in this instance the issues of tariff 'construction' and 'reasonableness' were both referrable to the Commission does not, of course, bring the case within Morrisdale. Both of these questions were issues only by reason of the Government's defense; neither was part of the carrier's affirmative case. In other words, had the applicability of this tariff not been challenged by the Government, the carrier's own case would have presented nothing which was referrable to the Commission.
16
See n. 2, supra.
17
Statistics furnished by the Comptroller General show that since 1948 the General Accounting Office has post-audited 17,220,783 bills presented by carriers. In the same period post-audit revealed overpayment in 1,102,654 cases. The magnitude of these figures underscores the impossibility of requiring the Government to file anticipatory suits before the I.C.C. in every case where it thinks the carrier might later sue to recover the amount set off by the Government.
18
The estoppel defense is not asserted against the Western Pacific, so that this case must in any event go to the Commission. Hence adjudication of the estoppel defense as to the Bangor and Seaboard would no doubt await the Commission's determination as to whether the '1820' tariff was applicable to these shipments, and reasonable if so applied.
19
The ruling was made in 1943 and was confirmed in 1945. The Bangor and Seaboard shipments were made in 1944.
20
A private shipper may not invoke the defense of estoppel to prevent a carrier from collecting a higher applicable tariff rate than that which may have been actually quoted by the carrier. This results from § 6(7) of the Interstate Commerce Act, 24 Stat. 380, as amended, 49 U.S.C. § 6(7), 49 U.S.C.A. § 6(7), forbidding departures from the published tariff. See Pittsburgh, Cincinnati, Chicago & St. Louis R. Co. v. Fink, 250 U.S. 577, 583, 40 S.Ct. 27, 28, 63 L.Ed. 1151. The same considerations do not obtain when the Government is the shipper, in view of § 22 of the Act, 24 Stat. 387, as amended, 49 U.S.C. § 22, 49 U.S.C.A. § 22, providing that 'nothing in this chapter shall prevent the carriage, storage, or handling of property free or at reduced rates for the United States.'
| 89
|
352 U.S. 82
77 S.Ct. 175
1 L.Ed.2d 144
Max PUTNAM and Elizabeth Putnam, Petitioners,v.COMMISSIONER OF INTERNAL REVENUE.
No. 25.
Argued Oct. 17, 1956.
Decided Dec. 3, 1956.
Mr. Richard E. Williams, Des Moines, Iowa, for petitioners.
Mr. Philip Elman, Washington, D.C., for respondent.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
The petitioner, Max Putnam, in December 1948, paid $9,005.21 to a Des Moines, Iowa, bank in discharge of his obligation as guarantor of the notes of Whitehouse Publishing Company. That corporation still had a corporate existence at the time of the payment but had ceased doing business and had disposed of its assets eighteen months earlier. The question for decision is whether, in the joint income tax return filed by Putnam and his wife for 1948, Putnam's loss is fully deductible as a loss 'incurred in (a) transaction * * * for profit, though not connected with (his) trade or business' within the meaning of § 23(e)(2) of the Internal Revenue Code of 1939,1 or whether it is nonbusiness bad debt within the meaning of § 23(k)(4) of the Code,2 and therefore deductible only as a short-term capital loss.
2
The Commissioner determined that the loss was a nonbusiness bad debt to be given short-term capital loss treatment. The Tax Court3 and the Court of Appeals4 for the Eighth Circuit sustained his determination. Because of an alleged conflict with decisions of the Courts Appeals of other circuits,5 we granted certiorari.6
3
Putnam is a Des Moines lawyer who in 1945, in a venture not connected with his law practice,7 organized Whitehouse Publishing Company with two others, a newspaperman and a labor leader, to publish a labor newspaper. Each incorporator received one-third of the issued capital stock, but Putnam supplied the property and cash with which the company started business. He also financed its operations, for the short time it was in business, through advances and guarantees of payment of salaries and debts. Just before the venture was abandoned, Putnam acquired the shares held by his fellow stockholders and in July 1947, as sole stockholder, wound up its affairs and liquidated its assets. The proceeds of sale were insufficient to pay the full amount due to the Des Moines bank on two notes given by the corporation and guaranteed by Putnam for moneys borrowed in August 1946 and March 1947.
4
The familiar rule is that, instanter upon the payment by the guarantor of the debt, the debtor's obligation to the creditor becomes an obligation to the guarantor, not a new debt, but, by subrogation, the result of the shift of the original debt from the creditor to the guarantor who steps into the creditor's shoes.8 Thus, the loss sustained by the guarantor unable to recover from the debtor is by its very nature a loss from the worthlessness of a debt. This has been consistently recognized in the administrative and the judicial construction of the Internal Revenue laws9 which, until the decisions of the Courts of Appeals in conflict with the decision below, have always treated guarantors' losses as bad debt losses.10 The Congress recently confirmed this treatment in the Internal Revenue Code of 1954 by providing that a payment by a noncorporate taxpayer in discharge of his obligation as guarantor of certain noncorporate obligations 'shall be treated as a debt.'11
5
There is, then, no justification or basis for consideration of Putnam's loss under the general loss provisions of § 23(e)(2), i.e., as an ordinary nonbusiness loss sustained in a transaction entered into for profit. Congress has legislated specially in the matter of deductions of nonbusiness bad debt losses, i.e., such a loss is deductible only as a short-term capital loss by virtue of the special limitation provisions contained in § 23(k)(4). The decision of this Court in Spring City Foundry Co. v. Commissioner, 292 U.S. 182, 54 S.Ct. 644, 78 L.Ed. 1200, is apposite and controlling. There it was held that a debt excluded from deduction under § 234(a)(5) of the Revenue Act of 1918 was not to be regarded as a loss deductible under § 234(a)(4). Chief Justice Hughes said for the Court:
6
'Petitioner also claims the right of deduction under section 234(a)(4) of the Revenue Act of 1918 providing for the deduction of 'losses sustained during the taxable year and not compensated for by insurance or otherwise.' We agree with the decision below that this subdivision and the following subdivision (5) relating to debts are mutually exclusive. We so assumed, without deciding the point, in Lewellyn v. Electric Reduction Co., 275 U.S. 243, 246, 48 S.Ct. 63 (64), 72 L.Ed. 262. The making of the specific provision as to debts indicates that these were to be considered as a special class and that losses on debts were not to be regarded as falling under the preceding general provision. What was excluded from deduction under subdivision (5) cannot be regarded as allowed under subdivision (4). If subdivision (4) could be considered as ambiguous in this respect, the administrative construction which has been followed from the enactment of the statute—that subdivision (4) did not refer to debts—would be entitled to great weight. We see no reason for disturbing that construction.' 292 U.S. at page 189, 54 S.Ct. at page 647.
7
Here also the statutory scheme is to be understood as meaning that a loss attributable to the worthlessness of a debt shall be regarded as a bad debt loss, deductible as such or not at all.
8
The decisions of the Courts of Appeals in conflict with the decision below turn upon erroneous premises.12 It is said that the guarantor taxpayer who involuntarily acquires a worthless debt is in a position no different from the taxpayer who voluntarily acquires a debt known by him to be worthless. The latter is treated as having acquired no valid debt at all.13 The situations are not analogous or comparable. The taxpayer who voluntarily buys a debt with knowledge that he will not be paid is rightly considered not to have acquired a debt but to have made a gratuity. In contrast the guarantor pays the creditor in compliance with the obligation raised by the law from his contract of guaranty. His loss arises not because he is making a gift to the debtor but because the latter is unable to reimburse him.
9
Next it is assumed, at least in the Allen case, that a new obligation arises in favor of the guarantor upon his payment to the creditor. From that premise it is argued that such a debt cannot 'become' worthless but is worthless from its origin, and so outside the scope of § 23(k). This misconceives the basis of the doctrine of subrogation, apart from the fact that, if it were true that the debt did not 'become' worthless, the debt nevertheless would not be regarded as an ordinary loss under § 23(e). Spring City Foundry Co. v. Commissioner, supra. Under the doctrine of subrogation, payment by the guarantor, as we have seen, is treated not as creating a new debt and extinguishing the original debt, but as preserving the original debt and merely substituting the guarantor for the creditor. The reality of the situation is that the debt is an asset of full value in the creditor's hands because backed by the guaranty. The debtor is usually not able to reimburse the guarantor and in such cases that value is lost at the instant that the guarantor pays the creditor. But that this instant is also the instant when the guarantor acquires the debt cannot obscure the fact that the debt 'becomes' worthless in his hands.
10
Finally, the Courts of Appeals found support for their view in the following language taken from the opinion of this Court in Eckert v. Burnet, 283 U.S. 140, 51 S.Ct. 373, 75 L.Ed. 911:
11
'The petitioner claims the right to deduct half that sum as a debt 'ascertained to be worthless and charged off within the taxable year' under the Revenue Act of 1926, c. 27, § 214(a)(7), 44 Stat. 9, 27.
12
'It seems to us that the Circuit Court of Appeals sufficiently answered this contention by remarking that the debt was worthless when acquired. There was nothing to charge off. The petitioner treats the case as one of an investment that later turns out to be bad. But in fact it was the satisfaction of an existing obligation of the petitioners, having, it may be, the consequence of a momentary transfer of the old notes to the petitioner in order that they might be destroyed. It is very plain we think that the words of the statute cannot be taken to include a case of that kind.' 283 U.S. at page 141, 51 S.Ct. at page 374. (Emphasis added.)
13
That statement did not imply a determination by this Court that the guarantor's loss was not to be treated as a bad debt.14 This Court was not faced with the question in Eckert. The point decided by the case was that a guarantor reporting on a cash basis and discharging his guaranty, not by a cash payment, but by giving the creditor his promissory note payable in a subsequent year, was not entitled to a bad debt loss deduction in the year in which he gave the note. The true significance of the quoted language is that, although 'the debt was worthless when acquired', it could not be 'charged off' within the taxable year as the promissory note given for its payment was not paid or payable within that year.15
14
The objectives sought to be achieved by the Congress in providing short-term capital loss treatment for non-business bad debts are also persuasive that § 23(k)(4) applies to a guarantor's nonbusiness debt losses. The section was part of the comprehensive tax program enacted by the Revenue Act of 1942 to increase the national revenue to further the prosecution of the great war in which we were then engaged.16 It was also a means for minimizing the revenue losses attributable to the fraudulent practices of taxpayers who made to relatives and friends gifts disguised as loans.17 Equally, however, the plan was suited to put nonbusiness investments in the form of loans on a footing with other nonbusiness investments. The proposal originated with the Treasury Department, whose spokesman championed it as a means 'to insure a fairer reflection of taxable income.'18 and the House Ways and Means Committee Report stated that the objective was 'to remove existing inequities and to improve the procedure through which bad-debt deductions are taken.'19 We may consider Putnam's case in the light of these revealed purposes. His venture into the publishing field was an investment apart from his law practice. The loss he sustained when his stock became worthless, as well as the losses from the worthlessness of the loans he made directly to the corporation, would receive capital loss treatment; the 1939 Code so provides as to nonbusiness losses both from worthless stock investments and from loans to a corporation, whether or not the loans are evidenced by a security.20 It is clearly a 'fairer reflection' of Putnam's 1948 taxable income to treat the instant loss similarly. There is no real or economic difference between the loss of an investment made in the form of a direct loan to a corporation and one made indirectly in the form of a guaranteed bank loan. The tax consequences should in all reason be the same, and are accomplished by § 23(k) (4).21 The judgment is
15
Affirmed.
16
Mr. Justice HARLAN, dissenting.
17
Being unreconciled to the Court's decision, which settles a conflict on this tax question among the Courts of Appeals and thus has an impact beyond the confines of this particular case, I must regretfully dissent.
18
The Court's approval of the Commissioner's treatment of petitioner's loss as one arising from a 'nonbusiness debt,' within the meaning of § 23(k)(4) of the Internal Revenue Code of 1939,1 instead of as a loss incurred in a 'transaction entered into for profit,' under § 23(e)(2),2 rests on what is, in my opinion, a strained application of the equitable doctrine of subrogation. No one contends that petitioner acquired the Company's debt to the lending Bank when he entered into the agreement guaranteeing payment of that indebtedness. Rather, the Government's basic argument, as taken from its brief, is this:
19
'The principle is well established, both generally and in the State of Iowa (where the guaranty was executed and performed), that a guarantor who is required to make payment under his guaranty contract succeeds to the rights of the creditor by subrogation. The law implies a promise on the part of the principal debtor to reimburse the guarantor, and the guarantor's payment is treated not as extinguishing the debt but as merely substituting the guarantor for the creditor. * * * Accordingly, while a guarantor by entering into the guaranty contract and making payment thereunder puts himself in a position where he may sustain a loss, it is only if, and to the extent that, the debt which he acquires by subrogation is worthless that he actually sustains a loss. Thus, if the guarantor, having made payment under his guaranty contract, is able to recover in full from the principal debtor, he clearly suffers no loss at all. It follows, therefore, that any loss, the existence and extent of which is wholly and directly dependent upon the worthlessness of a debt, should be attributed to the worthlessness of that debt, i.e., should be considered a bad debt loss.'
20
The Government then adds this footnote: 'So long as payment of a debt is guaranteed by a solvent guarantor, the insolvency of the principal debtor obviously does not render the debt worthless. Consequently, if the debt which a guarantor acquires by subrogation becomes worthless, it necessarily becomes worthless in the hands of the guarantor rather than in the hands of the original creditor.'
21
Upon analysis, the Government's argument comes down to this: when the petitioner honored his guaranty obligation his payment was offset by the acquisition of the creditor Bank's rights against the Company on its indebtedness; in the Bank's hands those rights were worth full value, since the Company's indebtedness was secured by the guaranty; therefore petitioner's loss should be attributed to the subrogation debt, which became worthless in his hands because no longer so secured.
22
This argument would have substance in a case where the principal debtor was not insolvent at the time the guaranty was fulfilled; for in such a case it could be said that the acquired debt was not without value in the guarantor's hands, and hence he should not be allowed a tax deduction until the debt turns out to be worthless. But when, as here, the debtor is insolvent at the very time the guarantor meets his obligation, it defies reality to attribute the guarantor's loss to anything other than the discharge of his guaranty obligation. To attribute that loss to the acquired debt in such a case requires one to conceive of the debt as having value at the moment of acquisition, but as withering to worthlessness the moment the guarantor touches it. That the same debt in the same millisecond can have both of these antagonistic characteristics is, for me, too esoteric a concept to carry legal consequences, even in the field of taxation.
23
It was this departure from reality which first led the Court of Appeals for the Second Circuit to reject the Commissioner's theory, as applied to a loss incurred by a widow upon a guaranty of her husband's brokerage account which she was called upon to honor long after his death and the winding up of his insolvent estate. Fox v. Commissioner, 190 F.2d 101, 39 A.L.R.2d 873. In that case the court, after referring to the 'illusory character' of the subrogation claim which, the Tax Court held, she had acquired against her late husband upon her payment of the guaranty, went on to say, 190 F.2d at pages 103, 104:
24
'She (the widow) argues that the court's theory of a debt against her husband's estate amounts to a subrogation forced upon her, contrary to the equitable spirit of the doctrine, to yield her an utterly worthless claim and a very real tax liability. * * * (W)e think her argument persuasive. * * * Clearly * * * the (guaranty) transaction was not then one involving a bad debt, since she had not even made the payment which alone would give rise to a claim in her favor. Nor could payment ten years later create a debt out of something less than even the proverbial stone. It is utterly unrealistic to consider the payment as one made in any expectation of recovery over or of any legal claim for collection. Actually it was merely the fulfillment of her contractual obligation of the earlier date. The bad-debt provision thus had no direct application; only by straining the statutory language can we erect here a disembodied debt against an insolvent and long dead debtor.'
25
Being unable to differentiate the worthlessness of a subrogation debt claim against a nonexistent individual debtor from such a claim against an existent, but insolvent, corporate debtor, the Courts of Appeals, until the present case,3 have consistently applied the reasoning of the Fox case to losses incurred on individual guaranties of corporate indebtedness where the corporation, though still in existence, was insolvent at the time the guaranty was honored. Pollak v. Commissioner, 209 F.2d 57;4 Edwards v. Allen, 216 F.2d 794;5 Cudlip v. Commissioner, 220 F.2d 565;6 see also Ansley v. Commissioner, 217 F.2d 252.7 The rationale of these four Courts of Appeals is, in my opinion, more convincing than that of the Commissioner, and I think this Court should have approved and followed it here by holding that this taxpayer's loss was fully deductible under § 23(e)(2) as a loss on a 'transaction entered into for profit,' instead of regarding it as a 'nonbusiness debt' loss, subject to capital loss treatment under § 23(k)(4).
26
I cannot agree with the Court that either the circumstances under which § 23(k)(4) was enacted in 1942, or the provisions of § 166(f) of the Internal Revenue Code of 1954,8 point to an opposite conclusion. Section 23(k)(4) created a new category of debt losses, namely, 'nonbusiness debt' losses, which were thenceforth to be given capital loss treatment instead of the full loss deduction theretofore accorded them.9 The Court finds the 'objectives sought to be achieved by the Congress,' through the enactment of this section, 'persuasive that § 23(k)(4) applies to a guarantor's nonbusiness debt losses,' in that the 'section was part of the comprehensive tax program enacted by the Revenue Act of 1942 to increase the national revenue,' in connection with World War II, and 'was suited to put nonbusiness investments in the form of loans on a footing with other nonbusiness investments.' But it seems to me that the House Ways and Means Committee Report on the bill shows that § 23(k)(4) was aimed at a specific narrow objective, namely, that of reducing revenue loss from the deduction of 'family' or 'friendly' loans which were in reality gifts. The Report states:
27
'C. Nonbusiness Bad Debts.
28
'The present law gives the same tax treatment to bad debts incurred in nonbusiness transactions as it allows to business bad debts. An example of a nonbusiness bad debt would be an unrepaid loan to a friend or relative, while business bad debts arise in the course of the taxpayer's trade or business. This liberal allowance for nonbusiness bad debts has suffered considerable abuse through taxpayers making loans which they do not expect to be repaid. This practice is particularly prevalent in the case of loans to persons with respect to whom the taxpayer is not entitled to a credit for dependents. This situation has presented serious administrative difficulties because of the requirement of proof.
29
'The bill treats the loss from nonbusiness bad debts as a short-term capital loss. The effect of this provision is to take the loss fully into account, but to allow it to be used only to reduce capital gains. Like any other capital loss, however, the amount of such bad debt losses may be taken to the extent of $1,000 against ordinary income and the 5-year carryover provision applies.'10
30
I am unable to find in this, or in any of the other legislative history to which the Court refers, any clear intimation of a broad policy to analogize generally all types of nonbusiness loans to other forms of capital investment,11 still less anything which indicates that guarantors' losses were considered as falling within the new section.12
31
Likewise I think that the Court's reliance on § 166(f) of the 1954 Code is misplaced. That section provides that an individual taxpayer's guaranty payment discharging the obligation of a noncorporate debtor 'shall be treated as a debt becoming worthless within such taxable year,' and shall be deductible in full if (a) the proceeds of the guaranteed obligation were used 'in the trade or business of the borrower,' and (b) that obligation was worthless at the time the guarantor made payment.13 The Court says that by enacting this section Congress confirmed the administrative practice of treating guarantors' losses as bad debt losses, at least so far as guaranties of certain noncorporate obligations are concerned. I cannot agree, for again I think this section had a specific and limited purpose, which did not include the thrust which the Court now gives the section. That purpose, I think, was simply to permit deduction of certain guaranty payments that were not deductible at all under the 1939 Code. Payments now deductible under § 166(f) need not be made in the course of the guarantor's 'trade or business,' nor need they be attributable to a transaction 'entered into for profit.' They are deductible, it would seem, so long as the guarantor had some expectation of being repaid—so long, in other words, as the transaction was not a gift. Under prior law such payments would not have been deductible as 'business' debts, under § 23(k) (1),14 or as losses on transactions 'entered into for profit,' under § 23(e) (2), or even as 'nonbusiness' debts under § 23(k)(4), since the Fox line of cases held that such payments do not give rise to 'debts.' However, here again, as with the enactment of the § 23(k)(4) 'nonbusiness debt' provision in 1942, Congress was concerned with fending against allowance of this type of deduction in cases of fictitious 'family' or 'friendly' guaranties. Hence it was unwilling to allow the deduction to all guarantors of individual borrowings. Considering guaranties of loans sought for business purposes to be free of such infirmities, Congress attempted to obviate abuse of § 166(f) by limiting its application to guaranties of loans the proceeds of which 'were used in the trade or business of the borrower.'
32
In light of what seems to have been the particular congressional purpose, I think it strains § 166(f) to read it as broadly confirming the treatment of guaranty losses as bad debt losses.15 Congress presumably knew of the Fox line of cases, supra, which had refused 'debt' treatment to guarantors' losses, and it is not without significance that the Senate Report on § 166(f) stated: 'If the requirements of this section are not met, the taxpayer will, as under present law, be treated taxwise under whatever provisions of the Code are applicable in the factual situation.'16 It is true that § 166(f) provides that any payment included therein 'shall be treated as a debt'; but of more significance is the fact that the person claiming the deduction need not show that he in fact owned a 'debt' or that such debt had become 'worthless during the taxable year'—the requirement for deductibility of both business and nonbusiness bad debts under § 23(k)(1) and (4)—since 'for purposes of this section' § 166(f), the guarantor's loss is 'treated as' a debt 'becoming worthless within such taxable year' as the loss occurs. In other words, though assimilated to a 'debt' loss, the loss arising from the guaranty payment in fact need have none of the attributes of a debt loss in order to be deductible. The primary thrust of s 166(f) was to make deductible some kinds of losses which were theretofore not deductible, and I think that drawing from the language of the Section a definitive characterization of such losses as 'debts' involves a misplacing of emphasis.
33
Of still greater significance is the fact that § 166(f) losses are deductible in full. This, it seems to me, is more consistent with the view that Congress did not intend to disturb the line of cases which, following Fox, gave a full deduction under § 23(e)(2) to losses on guaranties of corporate obligations, than it is with the Court's view that § 166(f) confirms Congress' intent that such losses should be only partially deductible as nonbusiness bad debts under § 23(k)(4). Otherwise we would have the anomalous result that under the 1954 Code individual guarantors of noncorporate obligations are given better treatment than those guaranteeing corporate obligations, even though the basic limitation which Congress imposed upon the deductibility of § 166(f) losses, namely, that the proceeds of the guaranteed obligation 'were used in the trade or business of the borrower,' is always present in the case of a guaranty of a corporate obligation.
34
In short, I think that when the purposes and provisions of § 166(f) are taken together, it is quite evident that the section was intended to complement the decisions of these four Courts of Appeals,17 and not to override them.
35
Finally, the Government suggests that giving guarantors' losses the same capital loss treatment as nonbusiness debt losses would make for a better tax structure, since, it is argued, both kinds of losses are comparable to losses from investments, which receive capital loss treatment under both the 1939 and 1954 Codes.18 Even if that be so, this would be a matter for Congress. Our duty is to take the statute as we find it. I would reverse.
1
'§ 23. Deductions from gross income.
'In computing net income there shall be allowed as deductions:
'(e) Losses by individuals. In the case of an individual, losses sustained during the taxable year and not compensated for by insurance or otherwise—
'(2) if incurred in any transaction entered into for profit, though not connected with the trade or business; * * *.' 53 Stat. 13, 26 U.S.C. § 23(e) (2), 26 U.S.C.A. § 23(e)(2).
2
'§ 23. Deductions from gross income.
'(k) Bad debts.
'(4) Non-business debts. In the case of a taxpayer, other than a corporation, if a non-business debt becomes worthless within the taxable year, the loss resulting therefrom shall be considered a loss from the sale or exchange, during the taxable year, of a capital asset held for not more than 6 months. The term 'non-business debt' means a debt other than a debt evidence by a security as defined in paragraph (3) and other than a debt the loss from the worthlessness of which is incurred in the taxpayer's trade or business.' 53 Stat. 13, 56 Stat. 820, 26 U.S.C. § 23(k)(4), 26 U.S.C.A. § 23(k)(4).
3
13 CCH TC Mem.Dec. 458.
4
224 F.2d 947.
5
Pollak v. Commissioner, 3 Cir., 209 F.2d 57; Edwards v. Allen, 5 Cir., 216 F.2d 794; Cudlip v. Commissioner, 6 Cir., 220 F.2d 565.
6
350 U.S. 964, 76 S.Ct. 438.
7
Petitioners abandoned in this Court the alternative contention made below that the loss was deductible in full as a business had debt under § 23(k)(1).
8
United States v. Munsey Trust Co., 332 U.S. 234, 242, 67 S.Ct. 1599, 1603, 91 L.Ed. 2022; Aetna Life Ins. Co. v. Town of Middleport, 124 U.S. 534, 548, 8 S.Ct. 625, 629, 31 L.Ed. 537; Howell v. Commissioner, 8 Cir., 69 F.2d 447, 450; Scott v. Norton Hardware Co., 4 Cir., 54 F.2d 1047; Brandt, Suretyship, and, Guaranty, (3d ed.), § 324; 38 C.J.S., Guaranty, § 111; 24 Am.Jur., Guaranty, § 125. Iowa follows this rule. Randell v. Fellers, 218 Iowa 1005, 252 N.W. 787; American Surety Co. of New York v. State Trust & Sav. Bank, 218 Iowa 1, 254 N.W. 338. There is not involved here a question of the effect of state law upon federal tax treatment of Putnam's loss. Cf. Watson v. Commissioner, 345 U.S. 544, 73 S.Ct. 848, 97 L.Ed. 1232; Lyeth v. Hoey, 305 U.S. 188, 59 S.Ct. 155, 83 L.Ed. 119; Burnet v. Hamel, 287 U.S. 103, 53 S.Ct. 74, 77 L.Ed. 199.
9
The bad debt deduction provisions of earlier Revenue Acts were enacted in § 214(a)(7) of the Revenue Act of 1921, 42 Stat. 239; § 214(a)(7) of the Revenue Act of 1924, 43 Stat. 269; § 214(a)(7) of the Revenue Act of 1926, 44 Stat. 26; § 23(j) of the Revenue Act of 1928, 45 Stat. 799; § 23(j) of the Revenue Act of 1932, 47 Stat. 179; § 23(k) of the Revenue Act of 1934, 48 Stat. 688; § 23(k) of the Revenue Act of 1936, 49 Stat. 1658; § 23(k) of the Revenue Act of 1938, 52 Stat. 460; and § 23(k) of the Internal Revenue Code of 1939, 53 Stat. 12.
10
See, e.g., 2 Cum.Bull. 137; 5 Cum.Bull. 146; III—1 Cum.Bull. 158; III—1 Cum.Bull. 166; Shiman v. Commissioner, 2 Cir., 60 F.2d 65; Hamlen v. Welch, 1 Cir., 116 F.2d 413; Gimbel v. Commissioner, 36 B.T.A. 539; Roberts v. Commissioner, 36 B.T.A. 549; Sharp v. Commissioner, 38 B.T.A. 166; Hovey v. Commissioner, P—H 1939 B.T.A.Men.Dec. 39,081; Pierce v. Commissioner, 41 B.T.A. 1261; Whitcher v. Welch, D.C., 22 F.Supp. 763.
Similar decisions rendered since the Revenue Act of 1942 include: Ortiz v. Commissioner, 42 B.T.A. 173, reversed on another ground, sub nom. Helvering v. Wilmington Trust Co., 3 Cir., 124 F.2d 156, reversed (without discussion on this point), 316 U.S. 164, 62 S.Ct. 984, 86 L.Ed. 1352; Burnett v. Commissioner, P—H 1942 B.T.A.Mem.Dec. 42,528; Ritter v. Commissioner, P—H 1946 TC Mem.Dec. 46,237; Greenhouse v. Commissioner, P—H 1954 TC Mem.Dec. 54,250; Estate of Rosset v. Commissioner, P—H 1954 TC Mem.Dec. 54,346; Watson v. Commissioner, 8 T.C. 569; Sherman v. Commissioner, 18 T.C. 746; Aftergood v. Commissioner, 21 T.C. 60; Stamos v. Commissioner, 22 T.C. 885.
11
'§ 166. Bad debts
'(f) Guarantor of certain noncorporate obligations.—A payment by the taxpayer (other than a corporation) in discharge of part or all of his obligation as a guarantor, endorser, or indemnitor of a noncorporate obligation the proceeds of which were used in the trade or business of the borrower shall be treated as a debt becoming worthless within such taxable year for purposes of this section (except that subsection (d) shall not apply), but only if the obligation of the borrower to the person to whom such payment was made was worthless (without regard to such guaranty, endorsement, or indemnity) at the time of such payment.' 68A Stat. 50, 26 U.S.C. § 166(f), 26 U.S.C.A. § 166(f). And see 65 Yale L.J. 247.
12
See note 5, supra.
13
Reading Co. v. Commissioner, 3 Cir., 132 F.2d 306; W. F. Young, Inc., v. American Cigar Co. v. Commissioner, 2 Commissioner, 1 Cir., 120 F.2d 159; Cir., 66 F.2d 425.
14
The basis for this statement came from the opinion of the Court of Appeals for the Second Circuit and was explained by that court in its later opinion in Shiman v. Commissioner, 60 F.2d 65, 67, as follows: 'Though there was no debt until Shiman paid the brokers, it then became such at once and was known to be worthless as soon as it arose; verbally at any rate there is no difficulty. Nor is there any reason to impute a purpose to except such cases; the loss is as real and unavoidable as though the debt had had some value for a season. The analogy of section 204(b) is apt. We can see no ground therefore for question except some of the language used in Eckert v. Burnet, 283 U.S. 140, 51 S.Ct. 373, 75 L.Ed. 911, taken from our opinion in 2 Cir., 42 F.2d 158. That was quite another situation. Eckert, the taxpayer, had been an accommodation endorser for a corporation which became insolvent. When called upon to pay he gave his note instead, not payable within the year. The court refused to allow the deduction, because Eckert was keeping his books on a cash basis, but it intimated that when he paid he might succeed; until then he had done no more than change the form of the obligation. Yet if it were enough to defeat him that the debt was 'worthless when acquired,' the same objection ought to be good after he had paid; contrary to what was suggested. We cannot therefore think that the language so thrown out was intended as an authoritative statement by which we must be bound.'
15
See Helvering v. Price, 309 U.S. 409, 60 S.Ct. 673, 84 L.Ed. 836. The requirement that the debt be 'ascertained to be worthless and charged off within the taxable year' was superseded in the Revenue Act of 1942, § 124(a), by the requirement that the debt be one which 'becomes worthless within the taxable year.'
16
Chairman Doughton of the House Committee on Ways and Means opened the hearings on the bill which became the Revenue Act of 1942 with the statement: '* * * the meeting of the committee this morning is the first step in the consideration, preparation, and reporting of perhaps the largest tax bill that it has ever been the duty and responsibility of our committee to report.
'We are faced with revenue needs and a tax program of a magnitude unthought of in modern times, and we all realize it is necessary to raise every dollar of additional revenue that can be raised without seriously disturbing or shattering our national economy.' Hearings before House Committee on Ways and Means on Revenue Revision of 1942, 77th Cong., 2d Sess. 1.
17
Petitioners argue that this was its sole purpose and that the section should be construed as limited in application to such loans. The context of the segment of the House Ways and Means Committee Report discussing this objective does not support the petitioners' argument. H.R.Rep. No. 2333, 77th Cong., 2d Sess. 45:
'C. Nonbusiness Bad Debts
'The present law gives the same tax treatment to bad debts incurred in nonbusiness transactions as it allows to business bad debts. An example of a nonbusiness bad debt would be an unrepaid loan to a friend or relative, while business bad debts arise in the course of the taxpayer's trade or business. This liberal allowance for nonbusiness bad debts had suffered considerable abuse through taxpayers making loans which they do not expect to be repaid. This practice is particularly prevalent in the case of loans to persons with respect to whom the taxpayer is not entitled to a credit for dependents. This situation has presented serious administrative difficulties because of the requirement of proof.
'The bill treats the loss from nonbusiness bad debts as a short-term capital loss. The effect of this provision is to take the loss fully into account, but to allow it to be used only to reduce capital gains. Like any other capital loss, however, the amount of such bad debt losses may be taken to the extent of $1,000 against ordinary income and the 5-year carry-over provision applies.' (Emphasis added.)
18
Hearings before House Committee on Ways and Means on Revenue Revision of 1942, 77th Cong., 2d Sess. 90.
19
H.R.Rep. No. 2333, 77th Cong., 2d Sess. 44.
20
Section 23(g)(2) and (3) as to worthless stock. Section 23(k)(2, 3) and (4) as to loans. As Judge Stewart pointed out in his dissenting opinion in the Cudlip case, 220 F.2d at page 572:
'Had the petitioner made the necessary additional investment in the conventional form of subscribing for stock, his loss upon the failure of the corporation would have been a capital loss, § 23(g)(2), I.R.C. Had he made the investment in the form of a loan to the corporation evidenced by an instrument bearing interest coupons, his loss would likewise have been a capital loss, § 23(k)(2), I.R.C. Had he made the additional investment in the form of an ordinary loan to the corporation, his loss would likewise have been a capital loss, § 23(k)(4) I.R.C., Commissioner of Internal Revenue v. Smith, supra (2 Cir., 1953, 203 F.2d 310).
'Because the petitioner happened instead to risk his money by guaranteeing the corporation's bank loans, the court now holds that the petitioner may take an ordinary loss, deductible in full from his ordinary income. Yet from the petitioner's viewpoint, the situation would have been precisely the same had he himself borrowed the money and then lent it to the corporation. It therefore seems to me that the result reached by the court in this case is significantly unrealistic.'
21
Upon this ground, contrary to the holding in Fox v. Commissioner, 2 Cir., 190 F.2d 101, 39 A.L.R.2d 873, the guarantor's nonbusiness loss would receive shortterm capital loss treatment despite the nonexistence of the debtor at the time of the guarantor's payment to the creditor.
1
'(§ 23(k)) (4) Non-business debts.
'In the case of a taxpayer, other than a corporation, if a non-business debt becomes worthless within the taxable year, the loss resulting therefrom shall be considered a loss from the sale or exchange, during the taxable year, of a capital asset held for not more than 6 months. The term 'non-business debt' means a debt other than a debt evidenced by a security as defined in paragraph (3) and other than a debt the loss from the worthlessness of which is incurred in the taxpayer's trade or business.'
2
'§ 23. Deductions from gross income.
'In computing net income there shall be allowed as deductions:
'(e) Losses by individuals.
'In the case of an individual, losses sustained during the taxable year and not compensated for by insurance or otherwise—
'(2) if incurred in any transaction entered into for profit, though not connected with the trade or business * * *.'
3
8 Cir., 224 F.2d 947.
4
Third Circuit.
5
Fifth Circuit.
6
Sixth Circuit.
7
Third Circuit.
8
'(§ 166) (f) Guarantor of Certain Noncorporate Obligations.—A payment by the taxpayer (other than a corporation) in discharge of part or all of his obligation as a guarantor, endorser, or indemnitor of a noncorporate obligation the proceeds of which were used in the trade or business of the borrower shall be treated as a debt becoming worthless within such taxable year for purposes of this section (except that subsection (d) shall not apply), but only if the obligation of the borrower to the person to whom such payment was made was worthless (without regard to such guaranty, endorsement, or indemnity) at the time of such payment.'
9
I.R.C.1939, § 23(k)(1), 53 Stat. 13, 26 U.S.C.(1940 ed.) § 23(k)(1), 26 U.S.C.A. § 23(k)(1).
10
H.R.Rep. No. 2333, 77th Cong., 2d Sess. 45.
11
Had this been the congressional purpose, it could have been accomplished simply by subjecting nonbusiness debt losses to the provisions of the statute dealing with worthless securities. See § 23(g)(2—4) of the Internal Revenue Code of 1939.
12
When it enacted § 23(k)(4) Congress left undisturbed § 23(e)(2) relating to the deductibility of losses on 'any transaction entered into for profit,' and that section was subsequently re-enacted, unchanged, as § 165(c)(2) of the Internal Revenue Code of 1954, 26 U.S.C.A. § 165(c)(2).
13
See note 8, supra.
14
'§ 23. Deductions from gross income.
'In computing net income there shall be allowed as deductions:
'(k) Bad debts.
'(1) General rule.
'Debts which become worthless within the taxable year * * *. This paragraph shall not apply in the case of a taxpayer, other than a corporation, with respect to a non-business debt, as defined in paragraph (4) of this subsection.'
15
The Senate Report on § 166(f) simply states: 'Your committee also provided that business had debt treatment will be available where a noncorporate taxpayer, who was the endorser (or guarantor or indemnitor) of the obligation of another, is required to pay the other's debt (and cannot collect it from the debtor). However, this treatment is to be available only where the debt represents money used in the other person's trade or business. Your committee believes that this treatment should be available in such cases since in most cases debts of this type usually are incurred because of business relationships.' S.Rep. No. 1622, 83d Cong., 2d Sess. 24—25.
16
S.Rep. No. 1622, 83d Cong., 2d Sess. 200. (Italics supplied.)
17
77 S.Ct. 182, 183, supra.
18
I.R.C.1939, § 23(g)(2—4), 26 U.S.C.A. § 23(g)(2—4); I.R.C.1954, § 165(g), 26 U.S.C.A. § 165(g).
| 1112
|
352 U.S. 145
77 S.Ct. 154
1 L.Ed.2d 201
Boyd LEEDOM et al., as Members of the National Labor Relations Board, Petitioners,v.INTERNATIONAL UNION OF MINE, MILL AND SMELTER WORKERS.
No. 57.
Argued Nov. 14, 1956.
Decided Dec. 10, 1956.
Theophil C. Kammholz, Washington, D.C., for the petitioners.
Mr. Nathan Witt, New York City, for respondent.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
Section 9(h) of the National Labor Relations Act, as amended, 61 Stat. 136, 146, 65 Stat. 601, 602, 29 U.S.C. § 159(h), 29 U.S.C.A. § 159(h), provides that the Board shall make no investigation nor issue any complaint on behalf of a union unless there is on file with the Board a non-Communist oath of each officer of the union and of each officer of any national or international labor organization of which it is an affiliate or constituent unit.1 Section 9(h) further provides that 'The provisions of section 35 A of the Criminal Code shall be applicable in respect to such affidavits.' Section 35 A of the Criminal Code applies a criminal sanction tends the sanction of perjury2 to false affidavits filed under § 9(h). The question in this case is whether criminal prosecution under that provision is the exclusive remedy for the filing of a false affidavit under § 9(h) or whether the Board may take administrative action and, on a finding that a false affidavit has been filed, enter an order of decompliance, withholding from the union in question the benefits of the Act until it is satisfied that the union has complied. The court below held that the criminal sanction was the exclusive remedy for filing the false affidavit. 96 U.S.App.D.C. 416, 226 F.2d 780. That decision is in conflict with a ruling of the Court of Appeals for the Sixth Circuit. National Labor Relations Board v. Lannom Mfg. Co., 226 F.2d 194. We granted the petitions for certiorari in each case in order to resolve the conflict. 351 U.S. 949, 76 S.Ct. 846; Amalgamated Meat Cutters and Butcher Workmen of North America, AFL—CIO v. N.L.R.B., 351 U.S. 905, 76 S.Ct. 695.
2
The union involved in the present case is the International Union of Mine, Mill, and Smelter Workers. The union filed a complaint with the Board charging that the Precision Scientific Co. refused to bargain with it in violation of the Act. During the course of the hearing before the Board, the company challenged the veracity of affidavits filed by one Travis, an officer of the union, under § 9(h). The Board, in accord with its practice,3 refused to allow that issue to be litigated in the unfair labor practice proceeding. But later on, it issued an order directing an administrative investigation and hearing. A hearing was held before an examiner who found, among other things, that the § 9(h) affidavit filed by Travis in August 1949 was false and that the union membership knew it was false and yet continued to re-elect him as an officer. The Board agreed with the trial examiner, held that the union was not and had not been in compliance with § 9(h) of the Act, and ordered that the union be accorded no further benefits under the Act until it had complied. Maurice E. Travis, 111 N.L.R.B. 422. The Board, thereafter, dismissed the union's complaint against Precision Scientific Co., an action later vacated pursuant to a stay issued by the court below.
3
The instant suit was brought in the District Court by the union, which prayed that the Board's order of decompliance be enjoined. Precision Scientific Co. intervened. The District Court denied a preliminary injunction. The Court of Appeals reversed, 96 U.S.App.D.C. 416, 226 F.2d 780, on the authority of its prior decision in Farmer v. International Fur & Leather Workers Union, 95 U.S.App.D.C. 308, 221 F.2d 862. It held that a false affidavit filed under § 9(h) of the Act gave rise only to a criminal penalty against the guilty union officer and did not in any way alter the union's right to the benefits of the Act, even where its members were aware of the officer's fraud.
4
We agree with the court below that the Board has no authority to deprive unions of their compliance status under § 9(h) and that the only remedy for the filing of a false affidavit is the criminal penalty provided in § 35 A of the Criminal Code. We start with a statutory provision that contains only one express sanction, viz., prosecution for making a false statement. No other sections of the Act expressly supplement that one sanction.
5
The aim of § 9(h) is clear. It imposes a criminal penalty for filing a false affidavit so as to deter Communist officers from filing at all. The failure to file stands as a barrier to the making of an investigation by the Board and the issuance of any complaint for the benefit of the union in question. The section, therefore, provides an incentive to the members of the union to rid themselves of Communist leadership and elect officers who can file affidavits in order to receive the benefits of the Act. The filing of the required affidavits by the necessary officers is the key that makes available to the union the benefits of the Act.
6
The Board is under a duty to determine whether a filing has been made by each person specified in § 9(h), since its power to act on union charges is conditioned on filing of the necessary affidavits. That was the extent of our rulings in National Labor Relations Board v. Highland Park Mfg. Co., 341 U.S. 322, 71 S.Ct. 758, 95 L.Ed. 969; National Labor Relations Board v. Coca-Cola Bottling Co., 350 U.S. 264, 76 S.Ct. 383. The argument made by the Board would have us go further and read into the Act an implied power to determine not only whether the affidavit has been filed but also whether the affidavit filed is true or false. And for that position reliance is placed on general statements in cases like National Labor Relations Board v. Indiana and Michigan Electric Co., 318 U.S. 9, 18—19, 63 S.Ct. 394, 400, 87 L.Ed. 579, that the Board has implied power to protect its process from abuse.
7
We are dealing here with a special provision that has a precise history. Both the Senate and the House originally passed bills which, though the language differed one from the other, made the test of compliance the fact of nonmembership of union officers in the Communist Party. See 1 Leg.Hist., Labor Management Relations Act, 1947, (Nat. Labor Rel. Bd., 1948), pp. 190, 251. If those provisions had become the law, the Board would have been required to conduct an inquiry into whether the officers were in fact non-Communist, at least where the veracity of the affiant was challenged.4 But a fundamental change in § 9(h) was made by the Conference Committee. As stated in the Conference Report respecting the provisions in the two bills,
8
'In reconciling the two provisions the conferees took into account the fact that representation proceedings might be indefinitely delayed if the Board was required to investigate the character of all the local and national officers as well as the character of the officers of the parent body or federation. The conference agreement provides that no certification shall be made or any complaint issued unless the labor organization in question submits affidavits executed by each of its officers and officers of its national or international body, to the effect that they are not members or affiliates of the Communist Party or any other proscribed themselves of Communist leaders. But provisions of section 35(a) of the Criminal Code (U.S.C., title 18, sec. 80) are made applicable to the execution of such affidavits.' 2 Leg. Hist., op. cit., supra, p. 1542.
9
Senator Taft explained the change of the Senate:
10
'This provision making the filing of affidavits with respect to Communist Party affiliation by its officers a condition precedent to use of the processes of the Board has been criticized as creating endless delays. It was to prevent such delays that this provision was amended by the conferees. Under both the Senate and House bills the Board's certification proceedings could have been infinitely delayed while it investigated and determined Communist Party affiliation. Under the amendment an affidavit is sufficient for the Board's purpose and there is no delay unless an officer of the moving union refuses to file the affidavit required.' Id., at 1625; 93 Cong.Rec. 6860.
11
This explicit statement by the one most responsible for the 1947 amendments seems to us to put at rest the question raised by this case. If, in spite of the change in wording of § 9(h) made by the Conference Committee, the Board could still investigate the truth or falsity of the affidavits filed, the unfair labor practice proceedings might be 'infinitely delayed,' to use Senator Taft's words. Under the construction presently urged by the Board, Senator Taft's assurance that 'an affidavit is sufficient for the Board's purpose' would be disregarded.
12
Much argument is advanced that the contrary position is favored by policy considerations. For example, it is said that if the Board can look into the truth or falsity of all § 9(h) affidavits and enter orders of decompliance in case they are found to be false, union members will have greater incentive to rid themselves of Communist leaders. But the rule written into § 9(h) is for the protection of unions as well as for the detection of Communists. It is not fair to read it only against the background of a case where the members knew their officer was a Communist. We are dealing with a requirement equally applicable to all unions, whether the members are innocent of such knowledge or guilty. As Judge Bazelon stated in Farmer v. United Electrical, Radio & Mach. Workers, 93 U.S.App.D.C. 178, 181, 211 F.2d 36, 39, there is no indication that Congress meant to impose on a union the drastic penalty of decompliance 'because its officer had deceived the union as well as the Board by filing a false affidavit.' The penalty stated in § 9(h) is one against the guilty officers. In view of the wording of § 9(h) and its legislative history, we cannot find an additional sanction which in practical effect would run against the members of the union, not their guilty officers. That was the Board's original position,5 and we think it is the correct one.
13
Affirmed.
1
'No investigation shall be made by the Board of any question affecting commerce concerning the representation of employees, raised by a labor organization under subsection (c) of this section, and no complaint shall be issued pursuant to a charge made by a labor organization under subsection (b) of section 10, unless there is on file with the Board an affidavit executed contemporaneously or within the preceding twelve-month period by each officer of such labor organization and the officers of any national or international labor organization of which it is an affiliate or constituent unit that he is not a member of the Communist Party or affiliated with such party, and that he does not believe in, and is not a member of or supports any organization that believes in or teaches, the overthrow of the United States Government by force or by any illegal or unconstitutional methods. The provisions of section 35 A of the Criminal Code shall be applicable in respect to such affidavits.'
2
Section 35 A provides a penalty of 10,000, or a prison or both, for making, among other things, fraudulent statements 'in any matter within the jurisdiction of any department or agency of the United States.' 52 Stat. 197, 18 U.S.C.A. § 1001, 18 U.S.C.A. § 1001.
3
See In the Matter of Lion Oil Co., 76 N.L.R.B. 565, 566; Coca-Cola Bottling Co., 108 N.L.R.B. 490, 491.
4
See the colloquy between Senators Ferguson and McClellan in 2 Leg.Hist., Labor Management Relations Act, 1947, pp. 1434 1435.
5
In the Matter of Craddock-Terry Shoe Corp., 76 N.L.R.B. 842, 843, a proceeding involving an unfair labor practice, the Board refused to entertain evidence that the affidavits filed under § 9(h) were false, the Board saying: 'In the instant case there is on file an affidavit identifying the officers of the Union, and non-Communist affidavits signed by each officer so identified. It is not the purpose of the statute to require the Board to investigate the authenticity or truth of the affidavits which have been filed. Persons desiring to establish falsification or fraud have recourse to the Department of Justice for a prosecution under Section 35(a) of the Criminal Code. The evidence sought to be adduced under this allegation is accordingly immaterial.' And see In the Matter of Alpert and Alpert, 92 N.L.R.B. 806, 807.
On March 18, 1952, Paul M. Herzog, then Chairman of the Board, testified on § 9(h) problems in Senate hearings. He reported that in the four years ending June 30, 1951, there had been filed with the Board 232,000 non-Communist affidavits. He reviewed the history of § 9(h) and remarked how 'intolerable and delaying' the administrative process would have been if the proposals orginally contained in § 9(h), and which we have discussed, had been enacted into law:
'* * * Had this provisions been enacted into law, the Board would have been inundated with litigation on an issue concerning which proof is singularly difficult to obtain, to the detriment of speedy disposal of cases which cry out for early employee recourse to the ballot box.
Page 151-Continued
'Instead, Congress imposed an obligation on labor union 'officers'—without defining them in the statute—to take the affirmative step of forswearing Communist affiliation. The theory evidently was that if these officers' refusal to sign affidavits deprived their constituents of all the Board's facilities, the spotlighting of that refusal would soon generate pressure from below to remove them from office. It was apparent from the outset that the NLRB's sole function was to make certain that the necessary persons filed these affidavits, and that, once they had done so pursuant to the rules we adopted, we were to process their cases without inquiring into the truth or falsity of the affidavits themselves. Where such an issue arose, the Board's statutory duty was only to refer the affidavit to the Department of Justice for investigation and possible prosecution for perjury under the Criminal Code. We have made 55 such referrals since 1947.'
Hearings, Senate Subcommittee of Committee on Labor and Public Welfare, Communist Domination of Unions and National Security, 82d Cong., 2d Sess., p. 91.
On November 10, 1953, the Board issued a Statement of Policy which overturned its previous position. The Board then concluded that a conviction for filing a false affidavit 'would necessarily invalidate any certifications or other official action taken by the Board in reliance on the truth of such affidavits.' The extent of this change in policy was underscored by the Board's further decision to hold in abeyance representation elections which concerned a union whose officers were under indictment for filing false affidavits. 18 Fed.Reg. 7185.
| 89
|
352 U.S. 128
77 S.Ct. 186
1 L.Ed.2d 189
MASSACHUSETTS BONDING & INSURANCE CO. and Kathleen F. Crowley, Administratrix of the Estate of Jeremiah C. Crowley, Petitioners,v.UNITED STATES of America.
No. 31.
Argued Nov. 8, 1956.
Decided Dec. 10, 1956.
Mr. John R. Kewer, Boston, Mass., for petitioners.
Mr. Paul A. Sweeney, Washington, D.C., for respondent.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
This is a suit under the Federal Tort Claims Act, 28 U.S.C. §§ 1346(b), 2674, 28 U.S.C.A. §§ 1346(b), 2674, to recover money damages from the United States on account of the death of one Crowley, caused by negligent operation of traveling cranes by various government employees in a federal arsenal located in Massachusetts.1 The Act makes the United States liable for the negligence of its employees 'under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.' 28 U.S.C. § 1346(b), 28 U.S.C.A. § 1346(b). That provision makes the law of Massachusetts govern the liability of the United States for this tort.
2
The Massachusetts Death Act, in relevant part, provides that a person, whose agents or servants by negligence cause the death of another not in his employment or service, 'shall be liable in damages in the sum of not less than two thousand nor more than twenty thousand dollars, to be assessed with reference to the degree of his culpability or of that of his agents or servants.' Mass.Ann.Laws, 1955, c. 229, § 2C. The assessment of damages with reference to the degree of culpability of the tort-feasor, rather than with reference to the amount of pecuniary loss suffered by the next of kin, makes those damages punitive in nature. That has been the holding of the Supreme Judicial Court of Massachusetts. As stated in Macchiaroli v. Howell, 294 Mass. 144, 147, 200 N.E. 905, 906, 'The chief characteristic of the statute is penal.' And see Arnold v. Jacobs, 316 Mass. 81, 84, 54 N.E.2d 922; Porter v. Sorell, 280 Mass. 457, 460—461, 182 N.E. 837, 85 A.L.R. 1159.
3
The Tort Claims Act, however, provides in § 28 U.S.C. § 2674, 28 U.S.C.A. § 2674, that:
4
'The United States shall be liable * * * in the same manner and to the same extent as a private individual under like circumstances, but shall not be liable for interest prior to judgment or for punitive damages.
5
'If, however, in any case wherein death was caused, the law of the place where the act or omission complained of occurred provides, or has been construed to provide, for damages only punitive in nature, the United States shall be liable for actual or compensatory damages, measured by the pecuniary injuries resulting from such death to the persons respectively, for whose benefit the action was brought, in lieu thereof.' (Italics added.)
6
The District Court accordingly held that, since the United States was liable for 'actual or compensatory' damages and not for 'punitive' damages, the minimum and maximum limits contained in the Massachusetts Death Act were not applicable. It entered judgment for the plaintiffs in the amount of $60,000. The Court of Appeals reversed, holding that the Massachusetts Death Act, though punitive, sets the maximum that may be recovered in compensatory damages under the Tort Claims Act. 227 F.2d 385. The case is here on certiorari which we granted to review this important question of construction of the Tort Claims Act, 350 U.S. 980, 76 S.Ct. 469.
7
The provision of the Act, making the United States liable 'for actual or compensatory damages' where the law of the place provides 'for damages only punitive in nature,' goes back to a 1947 amendment. Alabama2 and Massachusetts3 award only punitive damages for wrongful deaths. Controversies soon arose in those two States in suits under the Act, the Government maintaining that, since local law assessed only 'punitive damages,' it was not liable. Several bills were introduced to remedy the situation.4 But the solution agreed upon was in a proposal tendered by the Comptroller General. In reference to the Alabama and Massachusetts rule, the spokesman of the Comptroller General stated:5
8
'Since in those two states compensatory damages are not allowed, all that is required is to amend the Federal Tort Claims Act to say that in such states compensatory damages shall be allowed. * * * It is believed that that suggestion whould eliminate the discrepancy and would make the settlement of claims in those two states to be exactly in accord with the general rules followed in the other 46 states. * * *'
9
The Government seizes on this statement and like ones in the Committee Reports (see S.Rep.No. 763, 80th Cong., 1st Sess., p. 2; H.R.Rep.No. 748, 80th Cong., 1st Sess., p. 2) to argue that unless the ceiling provided in the Massachusetts law is respected, discrimination against the United States will be shown in Massachusetts, since over a dozen States have ceilings on compensatory damages. It is also argued that the sole purpose of the amendment was to permit recovery for wrongful death in the two States where punitive damages could be awarded, not to alter the measure of recovery in those States. It is true that Congress was not legislating as to ceilings. Congress was, however, legislating as to the measure of the damages that could be recovered against the United States. As a result of the 1947 amendment, the United States became liable not for 'punitive damages' but for 'actual or compensatory' damages, where the law of the place provides for damages 'only punitive in nature.' 28 U.S.C. § 2674, 28 U.S.C.A. § 2674. The measure of damages adopted was 'the pecuniary injuries' resulting from the death.
10
It is argued that Massachusetts does not provide damages 'only punitive in nature' within the meaning of the Act; that even punitive damages serve a remedial end, as recognized by the Massachusetts court under that State's Death Act. See Sullivan v. Hustis, 237 Mass. 441, 447, 130 N.E. 247, 15 A.L.R. 1360; Putnam v. Savage, 244 Mass. 83, 85, 138 N.E. 808. It is said that Massachusetts law does not provide true punitive damages since the latter are never awarded for negligence alone and are generally imposed in addition to, not in lieu of, compensatory damages. These and related reasons are advanced for treating the Massachusetts measure of damages as the measure of 'actual or compensatory' damages recoverable against the United States under the Act.
11
We reject that reasoning. The standard of liability imposed by the Congress is at war with the one provided by Massachusetts. The standard of liability under the Massachusetts Death Act is punitive—i.e., 'with reference to the degree' of culpability—not compensatory. The standard under the Tort Claims Act is 'compensatory,' i.e., 'measured by the pecuniary injuries' resultng from the death. There is nothing in the Massachusetts law which measures the damages by 'pecuniary injuries.' The Massachusetts law, therefore, cannot be taken to define the nature of the damages that can be recovered under the Tort Claims Act.
12
In those States where punitive damages only are allowed for wrongful death, a limitation on the amount of liability has no relevance to the policy of placing limits on liability where damages are only compensatory. By definition, punitive damages are based upon the degree of the defendant's culpability. Where a state legislature imposes a maximum limit on such a punitive measure, it has decided that this is the highest punishment which should be imposed on a wrongdoer. This limitation, based as it is on concepts of punishment, cannot control a recovery from which Congress has eliminated all considerations of punishment.
13
Nor can it be concluded that the amendment was designed to remove discrimination in Alabama and Massachusets between the recoveries allowed in suits against the Government and in suits against individual defendants. The amendment, in fact, perpetuates those differences. In suits in those States, recovery against the Government and against a private defendant will not be the same in identical circumstances. Where the degree of fault is high, but the pecuniary injury slight, a large recovery will represent the degree of the individual defendant's culpability, but the Government will be liable only for the slight amount of damage actually done. On the other hand, where fault is slight, but the pecuniary injury great, the individual defendant's liability will similarly be less than that of the Government. These differences in recovery are inherent in the different measures of damages applicable in suits against the Government and against a private defendant where the State chooses to provide a punitive measure of damages for wrongful death. By adopting in such a State a compensatory measure of damages in suits against the Government, Congress deliberately chose to permit these substantial differences in recovery to exist. We therefore cannot infer that Congress has, at the same time, provided that maximum recoveries be identical.
14
The solution that Congress chose was (a) the adoption of the local law—whether punitive or compensatory—to determine the existence of liability of the United States, and (b) the substitution of 'compensatory' for 'punitive' damages where local law provides only the latter. When Congress rejected liability for 'punitive' damages, we conclude it went the whole way and made inoperative the rules of local law governing the imposition of 'punitive' damages. When Congress adopted 'actual or compensatory damages,' measured by the 'pecuniary injuries,' as the measure of liability in those States that awarded damages 'only punitive in nature,' we conclude it did not preserve as a limitation on 'compensatory' damages the limitation imposed by local law on 'punitive' damages. It would require considerable tailoring of the Act to make it read that way. We refuse the invitation to achieve the result by judicial interpretation.
15
Reversed.
16
Mr. Justice HARLAN, concurring.
17
Although I join in the Court's opinion in this case, the importance of the question impels me to add a word to what Mr. Justice DOUGLAS has written. The problem is not an easy one, and I do not think that inquiry can stop with a literal reading of the terms of the statute, plain though they may appear to be. Taking, as I think we should, § 2674(2) within the wider context of the purpose of the Tort Claims Act as a whole, I am still not convinced that Congress intended the $20,000 limitation in the Massachusetts punitive statute to apply to recoveries under the Tort Claims Act.
18
In applying that limitation, the underlying reasoning of the Court of Appeals was that § 2674(2) must not be read as subverting the overriding philosophy of the Tort Claims Act, that is, that the Government should be liable 'in the same manner and to the same extent' as a private individual under state law would be liable. It therefore argued that although § 2674(2) departed from this philosophy when it made recovery compensatory rather than punitive in instances where the state remedy was punitive, the section in every other respect should be construed harmoniously with this philosophy, and that therefore maxima in state statutes should apply to recoveries against the Government as well as private individuals, even though such a statute is punitive.
19
But it seems to me that the whole purpose and reason for the enactment of § 2674(2) was to differentiate between the Government and private defendants in the 'manner' and 'extent' of recovery in the particular cases where it applied, and I can find no good reason for giving the section only partial effect. In no case in Alabama or Massachusetts will a plaintiff recover from the Government 'in the same manner' as he would against an individual defendant, and in no case, except by fortuitous circumstance, will he recover to 'the same extent.' In both of these States if a highly culpable defendant causes small pecuniary injury, he will be 'punished' at a high figure, whereas the Government will merely pay the small amount of compensation. Or if a merely careless defendant causes high pecuniary damage, he is punished at a low figure under state law, while the Government must pay for the heavy damage done. In both cases, the effect of the statute is to make the Government liable in a different manner and to a different extent than a private individual under the same circumstances; this, indeed, was the very purpose of the amendment. I therefore do not see why this purposeful differentiation in 'manner' and 'extent' of recovery should stop at the problem of maximum recoveries. Since the Government is by the very statute made liable on a different basis than a private individual and will in every case pay a different amount than would a private individual, why does it offend the philosophy of the Act to make the Government liable for more than a private individual would pay? Thus, while it is true that in general the Tort Claims Act makes the United States pro tanto a private defendant, the very purpose of § 2674(2) was to prevent this assimilation in States where recovery is punitive. It seems to me, therefore, that there is no reason to re-establish the assimilation on this one matter of maximum allowable recovery.
20
Furthermore, I find it unlikely that Congress would have intended to subject plaintiffs to a maximum which was established for reasons of policy irrelevant to litigation under the Tort Claims Act. Massachusetts has decided that for reasons of policy possibly because of the danger of excessive jury verdicts in 'punitive' cases—recovery under its punitive statute should be limited to $20,000. The statute being penal, it embodies the judgment of the legislature that the highest punishment that should be imposed for nonhomicidal death is this figure. But as soon as punishment has nothing to do with the lawsuit—as it does not in suits under § 2674(2)—and as soon as recovery is for compensation of the victim rather than punishment, then the policy reasons on which the $20,000 limit are based vanish. Massachusetts might, of course, impose a limit on compensatory recoveries as well. It did so for a short time, but then repealed the statute. But it is clear that the limit embodied in this statute has nothing to do with a compensatory suit; the factors which led to the imposition of this maximum are irrelevant when damages are not punitive. It would therefore seem to me just as artificial to take the $20,000 limit of this statute and impose it on a Tort Claims Act recovery as it would be to use as a limit a maximum figure taken from a state criminal statute imposing a fine for negligent homicide. The limitation in the Massachusetts penal statute was arrived at under penal concepts, and should not be artificially imposed on a recovery from which penal considerations have been eliminated by congressional mandate.
21
The Court of Appeals suggests that if the Massachusetts 'punitive' maximum were not applicable, the Government would be put at a unique disadvantage in Massachusetts, since the death statutes of some twelve other States place limitations on recovery which concededly would be applicable to the United States under the provisions of the Tort Claims Act. But the limitations in these other States all relate to compensation statutes, and I do not, of course, suggest that such a limitation in Massachusetts would not also apply to the Government. The resulting lack of symmetry in the operation of the Act as between Massachusetts and the other States having death recovery maxima, seems to me no greater than it is as between such States and those which impose no monetary limitation on death recoveries. Moreover, symmetry in the first aspect can only be acieved at the expense of offending 'the general scheme of the Tort Claims Act to refer questions of liability of the United States to the provisions of 'the law of the place where the act or omission complained of occurred,"* since Massachusetts does not recognize compensatory actions.
22
I think, therefore, that recovery of actual compensatory damages is, in this case, in full accord with the philosophy of the Tort Claims Act.
23
Mr. Justice FRANKFURTER, whom Mr. Justice REED, Mr. Justice CLARK, and Mr. Justice BRENNAN join, dissenting.
24
The scope of this case, though involving a general Act of Congress, is geographically constricted; the holding is applicable only to actions under the Federal Tort Claims Act arising out of wrongful deaths in Massachusetts. The Court, finding the words of the Federal Tort Claims Act clear, reversed the judgment of the Court of Appeals, which has special responsibility for interpreting federal law in matters unique to its circuit.
25
Underlying the Court's reasoning is the belief that the language of the 1947 amendment is so clear that it would require creative reconstruction of the amendment to limit the amount of the judgment to the maximum recoverable under the Massachusetts Death Act. On more than one occasion, but evidently not frequently enough, Judge Learned Hand has warned against restricting the meaning of statute to the meaning of its 'plain' words. 'There is no surer way to misread any document than to read it literally * * *.' Guiseppi v. Walling, 144 F.2d 608, 624, 155 A.L.R. 761 (concurring opinion). Of course one begins with the words of a statute to ascertain its meaning, but one does not end with them. The notion that the plain meaning of the words of a statute defines the meaning of the statute reminds one of T. H. Huxley's gay observation that at times 'a theory survives long after its brains are knocked out.' One would suppose that this particular theory of statutory construction had had its brains knocked out in Boston Sand & Gravel Co. v. United States, 278 U.S. 41, 48, 49 S.Ct. 52, 53, 73 L.Ed. 170.
26
The words of this legislation are as plain as the Court finds them to be only if the 1947 amendment is read in misleading isolation. An amendment is not a repeal. An mendment is part of the legislation it amends. The 1947 amendment to the Federal Tort Claims Act of 1946 must be read to harmonize with the central purpose of the original Act. The central purpose of the original Act was to allow recovery against the United States on the basis and to the extent of recoveries for like torts committed by private tortfeasors in the State in which the act or omission giving rise to the claim against the United States occurred. The 1947 amendment filled the gap, a very small gap, that was disclosed in the scheme formulated by the 1946 Act.
27
The gap was the situation revealed in two of the forty-eight States, Alabama and Massachusetts. When the Federal Tort Claims Act was passed, the Death Acts of both Alabama and Massachusetts provided for assessment of the defendant's liability for damages on a punitive basis. In Alabama, however, there was no maximum limitation on the recovery, and the problem of this case—whether a recovery in excess of the statutory maximum recoverable against a private employer can be had against the United States—is therefore unique to recovery against the United States under the Massachusetts Death Act. In filling the gap, Congress was concerned only to provide for recovery against the United States for wrongful deaths in Massachusetts and Alabama and to provide for recovery, as did the original Act, on a compensatory not a punitive basis. There is nothing to indicate, and it is unreasonable to suppose, that Congress meant a recovery in Massachusetts to be unlimited in amount in the face of the State's statutory limitation at the same time that recoveries in the dozen other States with statutory limitations would be restricted. Such a construction not only takes Massachusetts plaintiffs out of the general scheme of the Federal Tort Claims Act. It does so by putting them in a better position than plaintiffs in the dozen other States with statutory ceilings. This imputes to Congress a desire to correct the inequity in the 1946 Act by creating an inequity in the 1947 amendment.
28
Of course the Massachusetts limitation is contained in a statute in which damages are related to a punitive rather than a compensatory basis. The purpose of the 1947 amendment was to allow recovery against the United States when the governing state statute measured damages on such a basis. With this sole exception that the state statute puts the recovery on a harsher basis, the state statute is the governing statute. It may well be that if Massachusetts were to enact a statute restricting recovery to compensatory damages, it would impose a different ceiling. But that is no reason for rejecting the ceiling in the present statute. It does not comport with good sense and reason to suppose that a State would impose a higher ceiling on a recovery based on compensatory damages than it does when it allows punitive damages. This common-sense assumption is supported by the fact that during the brief period from 1947 through 1949, when the Massachusetts statute did measure damages solely on a compensatory basis, the ceiling was fixed at $15,000. This was the same ceiling that was in the previous statute which measured damages on a combined punitive and compensatory basis and the same ceiling that was in the immediately subsequent statute which measured damages solely on a punitive basis. To deny effect to this common-sense assumption is to elevate the literal reading of the 1947 amendment above the central basis of the Federal Tort Claims Act, the assimilation of recovery under federal law to recovery under state law.
29
The Court of Appeals for the First Circuit, in an opinion by Chief Judge Magruder, construed the 1947 amendment in order to harmonize it with the central purpose of the Federal Tort Claims Act. Since elaboration of my reasons for agreeing with the interpretation of the Court of Appeals could only be a paraphrase of its opinion, I rest my dissent from the Court's judgment on what I regard as the substance of that opinion:
30
'In the process of enactment of the foregoing amendment (the 1947 Act), the committee reports in both the House and Senate, after pointing out that under the scheme of the Federal Tort Claims Act each case is determined 'in accordance with the law of the State where the death occurred,' made the following comment:
31
"This bill simply amends the Federal Tort Claims Act so that it shall grant to the people of two States the right of action already granted to the people of the other 46.
32
"This bill, with the committee amendment, will not authorize the infliction of punitive damages against the Government, and as so amended, it is reported favorably by a unanimous vote.
33
"Its passage will remove an unjust discrimination never intended, but which works a complete denial of remedy for wrongful homicide.' H.R.Rep.No. 748, Committee on the Judiciary, 80th Cong., 1st Sess.; Sen.Rep.No. 763, Committee on the Judiciary, 80th Cong., 1st Sess.
34
'Under the provisions of the Federal Tort Claims Act as they now appear in Title 28 of the Code (28 U.S.C.A.) it is still true that Congress has not enacted a new comprehensive code of federal tort liability. It is still true that the Act in general calls for an application of the law of the state where the wrongful act or omission occurred. Also, the generalization is still in the law that the United States is to be held liable in tort 'in the same manner and to the same extent as a private individual under like circumstances.' The exceptional situation covered by the second paragraph of 28 U.S.C. § 2674 (28 U.S.C.A. § 2674) (that is, the 1947 amendment) applies only to two of the 48 states, for in 46 of the states recovery under their respective Death Acts rests upon a compensatory basis. In about a dozen of these 46 states, the local Death Act contains some maximum limit on the amount of recovery. * * * In these states, as the plaintiffs are bound to concede, the United States could not be liable for more than the statutory maximum permitted by state law in suits against private employers. Such is the clear mandate of the first paragraph of 28 U.S.C. § 2674 (28 U.S.C.A. § 2674).
35
'As suggested above, the 1947 amendment to the Tort Claims Act did make a partial break in the original pattern of the Act in that, wherever the amendment was applicable, it became possible (1) that the United States might be held liable for a greater sum of damages, assessed on a compensatory basis, than might be assessed under the local Death Act against a private employer in cases in which the wrongdoer was deemed to have been guilty of the minimum degree of culpability, and (2) the United States might be liable for no substantial damages at all, where the plaintiff failed to prove any pecuniary injury to the next of kin * * * though under the local Death Act a private employer might be subject to large damages assessed on a punitive basis. Thus in either of these situations the United States would not be liable 'to the same extent' as a private employer under like circumstances, which is the generally applicable standard in the first paragraph of 28 U.S.C. § 2674 (28 U.S.C.A. § 2674.)
36
'But we think it is unnecessary to construe the 1947 congressional amendment, which was intended to remove what was deemed to be a discrimination in a very narrow situation, so as to effectuate a far greater discrimination and incongruity. If the contention of the plaintiffs were accepted, then in Massachusetts alone of all the states whose respective Death Acts contain a maximum limit of recovery, the United States may be held liable in an amount in excess of the maximum limit of recovery permitted against a private employer. (Footnote omitted.)
37
'The plaintiffs would have us read literally, and in isolation, the language of the second paragraph of 28 U.S.C. § 2674 (28 U.S.C.A. § 2674) that, in lieu of punitive damages, 'the United States shall be liable for actual or compensatory damages, measured by the pecuniary injuries resulting from such death to the persons respectively, for whose benefit the action was brought.' It is argued that since the damages, so computed, have been found to be $60,000, and since the Congress has imposed no maximum limit of recovery, then necessarily, by the very command of the Congress, the judgment against the United States here must be in the sum of $60,000.
38
'The trouble with the foregoing argument is that the Federal Tort Claims Act, as amended, must be read as an organic whold. In 1947, when the Congress enacted the amendment, it demonstrated no objection to that portion of the Massachusetts Death Act which contained a maximum limit of recovery. That was purely a matter of local legislative policy, and if a private employer could not be held for more than $20,000, then the Congress, in waiving the governmental immunity of the United States, had no reason to impose a liability upon the United States in excess of the maximum limit applicable to a private employer. What the Congress did not want was to have damages assessed against the United States on a punitive basis. We give full effect to the language of the congressional amendment if we assess damages against the United States on a compensatory basis measured by the pecuniary injuries resulting to the next of kin. Having done that, and if the amount so computed is in excess of $20,000, it is in no way inconsistent to cut down the larger sum to $20,000, the maximum amount recoverable under the terms of the Massachusetts Death Act. All of the $20,000 to be recovered in such a case would be compensatory damages—not one cent of it would be punitive damages—and thus there would be achieved the congressional objective of preventing the infliction of punitive damages against the United States. In other words, except where Congress has clearly provided otherwise, it is the general scheme of the Tort Claims Act to refer questions of liability of the United States to the provisions of 'the law of the place where the act or omission complained of occurred.' Thus we must look to the local law to see who is entitled to sue, and for whose benefit; we must look to the local law on whether contributory negligence of the decedent, or a release by him during his lifetime, bars the action for wrongful death; and we must also apply the provision of the local law as to the maximum amount of recovery, for in none of these particulars is there any inconsistent provision in the federal Act.' 227 F.2d 385, 388 391.
1
Plaintiffs were the administratrix of Crowley and the insurer of Crowley's employer. The latter having paid compensation to the decedent's dependents, was entitled to sue the tort-feasor under the Massachusetts Workmen's Compensation Act. Mass.Ann.Laws, 1949, c. 152, § 15.
2
Ala.Code, 1940, Tit. 7, § 123; Southern R. Co. v. Sherrill, 232 Ala. 184, 193, 167 So. 731; Louisville & N.R.Co. v. Davis, 236 Ala. 191, 198, 181 So. 695; Jack Cole, Inc., v. Walker, 240 Ala. 683, 200 So. 768.
3
For the period from January 1, 1947, to December 31, 1949, Massachusetts provided for a $2,000 minimum and a $15,000 maximum under a Death Act providing compensatory damages. Mass.Acts 1947, c. 506. See Beatty v. Fox, 328 Mass. 216, 102 N.E.2d 781. But on January 1, 1950, Massachusetts reverted to its system of punitive damages. Mass.Acts 1949, c. 427. The ceiling on the recovery was raised to $20,000 in 1951. Mass.Acts 1951, c. 250.
4
H.R. 3668, 80th Cong., 1st Sess., which would have made the United States liable for punitive damages where state law provided only for punitive damages; H.R. 3690, which in its original form would have repealed the prohibition against award of punitive damages.
5
The hearings, excerpts of which are furnished us in the Government's brief, are not printed.
*
227 F.2d 385, 391.
| 78
|
352 U.S. 153
77 S.Ct. 159
1 L.Ed.2d 207
AMALGAMATED MEAT CUTTERS and BUTCHER WORKMEN OF NORTH AMERICA, AFL-CIO, etc., Petitioner,v.NATIONAL LABOR RELATIONS BOARD and Lannom Manufacturing Company.
No. 40.
Argued Nov. 14, 1956.
Decided Dec. 10, 1956.
Mr. Harold I. Cammer, New York City, for petitioner.
Mr. Theophil C. Kammholz, Washington, D.C., for respondent, N.L.R.B.
Mr. Judson Harwood, Nashville, Tenn., for respondent, Lannom Mfg. Co.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
This is a companion case to Leedom v. International Union, 352 U.S. 145, 77 S.Ct. 154. International Fur and Leather Workers Union1 filed a charge with the National Labor Relations Board alleging that respondent Lannom Mfg. Co. had interfered with the rights of its employees guaranteed by the Act. 29 U.S.C.A. § 151 et seq. This charge was filed in April 1951. A complaint was issued based on the charges in February 1952. At the hearing, Lannom sought to prove that certain § 9(h) affidavits filed by officers of the union were false. The trial examiner ruled, in accordance with the Board's practice, that that issue could not be litigated in the proceeding. The trial examiner recommended that an appropriate remedial order issue to correct the unfair labor practice which he found to exist. The Board in general sustained the trial examiner and issued a remedial order against Lannom, 103 N.L.R.B. 847. Prior to this order, the Board had been enjoined from taking administrative action requiring the union's officers to reaffirm their § 9(h) affidavits. Farmer v. United Electrical, Radio and Mach. Workers, 93 U.S.App.D.C. 178, 211 F.2d 36. Accordingly the Board ruled, 'We are administratively satisfied that the Union was in compliance with section 9(h) at all times relevant hereto.' 103 N.L.R.B., at 847, n. 2.
2
In August 1953 an indictment was returned against Ben Gold, an officer of the union, charging that the § 9(h) affidavit which he filed with the Board on August 30, 1950, was false. In 1954 Gold was convicted for that offense.2 Thereafter, the Board ordered the union to show cause why its compliance status under the Act should not be altered, unless Gold were removed from office. The union re-elected Gold as its president. Shortly thereafter the Board reclared the union out of compliance with § 9(h). 108 N.L.R.B. 1190, 1191. The union then obtained from the District Court for the District of Columbia a preliminary injunction enjoining the Board from altering or restricting the union's compliance status by reason of Gold's conviction. The Court of Appeals affirmed. Farmer v. International Fur & Leather Workers Union, 95 U.S.App.D.C. 308, 221 F.2d 862.
3
The Board sought a stay of the preliminary injunction pending decision by the Court of Appeals in the Farmer case. When the stay was denied, the Board petitioned the court below, pursuant to § 10(e) of the Act, for enforcement of the unfair labor practice order. Respondent Lannom Mfg. Co. moved for dismissal of the enforcement petition on the grounds of Gold's conviction for false filing under § 9(h). The union intervened and opposed the motion to dismiss.
4
The court below granted the motion to dismiss, holding that, since the falsity of the affidavit had been proved, the requirements of § 9(h) had not been met and no benefits should be accorded the union. We granted certiorari. 351 U.S. 905, 76 S.Ct. 695.
5
As noted, the complaint in the unfair labor practice proceeding was issued in February 1952, more than twelve months after the affidavit of August 30, 1950. Section 9(h) provides that no investigation shall be made or complaint issued on behalf of a union unless there is on file with the Board a non-Communist affidavit of each officer 'executed contemporaneously or within the preceding twelve-month period.' There was no charge against Gold for filing a false affidavit in 1951. The Court of Appeals met that difficulty by presuming that a person who was a Communist in 1950 continued as such through 1951 and through the critical date of February 1952, in absence of evidence showing a change in the factual situation.3 6 Cir., 226 F.2d 194, 198—199.
6
The petitioner has also urged that Gold's conviction for filing a false affidavit could form no basis for holding the union in decompliance prior to the affirmance of Gold's conviction on appeal. At the time of the decision below, Gold's appeal was pending in the Court of Appeals for the District of Columbia. As noted,4 we have granted certiorari to review the affirmance of his conviction.
7
For the reasons stated in Leedom v. International Union, 352 U.S. 145, 77 S.Ct. 154, we conclude that the sole sanction for the filing of a false affidavit under § 9(h) is the criminal penalty imposed on the officer who files a false affidavit, not decompliance of the union nor the withholding of the benefits of the Act that are granted once the specified officers file their § 9(h) affidavits. Having so concluded, we find it unnecessary to reach the collateral phases of this controversy.
8
Reversed.
9
Mr. Justice FRANKFURTER, concurring.
10
I agree that decompliance of the union is not a sanction authorized by § 9(h). But this case presents another consideration that cannot be overlooked in the due administration of justice and that, standing alone, would lead me to reverse the judgment of the Court of Appeals. As stated below in the dissenting opinion of Judge Stewart:
11
'A court of competent jurisdiction has found that Gold's affidavit of August 30, 1950, was false. The critical date as to compliance with § 9(h) of the National Labor Relations Act as amended was the date of issuance of the Board's complaint. N.L.R.B. v. Dant, 344 U.S. 375 (73 S.Ct. 375, 97 L.Ed. 407) * * *. If the complaint had issued during the twelve month period while this false affidavit was in effect, the question before us would be clear cut. That, however, is not the case.
'In August of 1951 Gold filed a new non-Communist
12
affidavit, and it was during the effective period of that affidavit that the complaint in this case issued. No court has found that affidavit to be false. It is true that the Board found in 1954 that the Union was not at that time in compliance with § 9(h). Assuming the Board had power to make such a finding, and assuming further that it be considered a finding that the 1951 affidavit was false, it must, I should think, be supported, like any Board finding, by substantial evidence, considering the record as a whole. We have no such record before us. Indeed, it appears that the question of the truth or falsity of the 1951 affidavit has never been heard on the merits. (Footnote omitted.)
13
'A jury has found that in 1950 Gold was both a Communist and a liar, to put it bluntly. Yet to indulge in the presumption that he was therefore guilty of committing a criminal offense a year later in filing the 1951 affidavit is further than I can go on the record before us.' 226 F.2d 194, 199—200.
1
In February 1955 this union merged with Amalgamated Meat Cutters & Butcher Workers of North America, petitioner in this case.
2
The judgment of conviction was affirmed by an equally divided Court of Appeals, sitting en banc. Gold v. United States, 99 U.S.App.D.C. 136, 237 F.2d 764. We granted certiorari in October 8, 1956. 352 U.S. 819, 77 S.Ct. 41.
3
It was on this phase of the case that Judge Stewart dissented:
'A jury has found that in 1950 Gold was both a Communist and a liar, to put it bluntly. Yet to indulge in the presumption that he was therefore guilty of committing a criminal offense a year later in filing the 1951 affidavit is further than I can go on the record before us.' 226 F.2d at page 200.
4
Note 2, supra.
| 89
|
352 U.S. 103
77 S.Ct. 195
1 L.Ed.2d 171
Gerald D. NELSON et al., as Successor Trustees Under the Will of William Nelson, Deceased, and Helen D. Moller, Appellants,v.The CITY OF NEW YORK.
No. 30.
Argued Nov. 7, 1956.
Decided Dec. 10, 1956.
Mr. William P. Jones, New York City, for appellants.
Mr. Seymour B. Quel, New York City, for appellee.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
Appellants challenge as violative of the Fourteenth Amendment the application of Title D, Chapter 17, of the New York City Administrative Code to two improved parcels of land owned by them as trustees. The statute is the counterpart, operative in the City of New York, of the state tax lien foreclosure statute that was before us last Term in Covey v. Town of Somers, 351 U.S. 141, 76 S.Ct. 724.1
2
In 1950, the City proceeded to foreclose its lien on the first of these parcels, referred to as the 45th Avenue property, for water charges that had been unpaid for four years. These charges, for the years 1945 and 1946, amounted to $65;2 the property was assessed at $6,000. The action was begun on May 20 with the filing of a list of 294 liened parcels, including the 45th Avenue property, in two sections of the Borough of Queens. Under the statute, this constituted the filing of a complaint.3 The statute requires that notice of such a foreclosure proceeding be posted and published and a copy of the published notice mailed to the last known address of the owner of property sought to be foreclosed.4 It is undisputed that the statutory notice requirements were satisfied in this case; a copy of the published notice was mailed to the address of the trust estate. However, appellants took no action during the 7 weeks allowed for redeeming the property through payment of back charges nor during the 20 additional days allowed for answering the City's complaint. Judgments of foreclosure were entered by default, and on August 22 the City acquired title to the parcel. The property was later sold to a private party for $7,000, the City retaining all the proceeds.
3
On December 17, 1951, a similar in rem foreclosure action was commenced against 1,704 parcels in four sections of the Borough of Brooklyn, including appellants' second parcel, referred to as the Powell Street property. The four-year-old water charges on this parcel amounted to $814.50;5 the property was assessed at $46,000. Again the statutory notice requirements were satisfied, and again judgment of foreclosure was entered by default. The City acquired title to the Powell Street property on May 19, 1952, and still retains it.
4
In November 1952, the appellants offered to pay with interest and penalties all amounts owing to the City on the two parcels. The offer was refused, and the appellants instituted a plenary action to set aside the City's deed to the Powell Street property and to recover the surplus proceeds from the sale of the 45th Avenue property. The Appellate Division of the New York Supreme Court affirmed the denial of the requested relief without prejudice to appellants' seeking to open their default by motions in the foreclosure proceedings. The appellants filed such motions, requesting the same relief they had sought in the plenary action. The case was submitted to the Supreme Court, Special Term, on opposing affidavits, and the motions were denied. The Special Term's orders were affirmed by the Appellate Division, 284 App.Div. 894, 134 N.Y.S.2d 597, and the Court of Appeals, 309 N.Y. 94, 127 N.E.2d 827. The Court of Appeals amended its remittitur to show that the federal questions here presented were decided adversely to appellants. 309 N.Y. 801, 130 N.E.2d 602.
5
1. Appellants contend they received no actual notice of the foreclosure proceedings. The reason they assign is that the mailed notices were concealed by their trusted bookkeeper, who is also alleged to have concealed from them the nonpayment of the water charges. There is no claim that the bills for the water charges were not mailed to the estate. They assert that it was not until November 1952, when the judgments of foreclosure had long since become final, that they discovered the bookkeeper's derelictions, and thus were made aware of their loss. However, as we have said, it is not disputed that the notices were mailed to the proper address. Nor is this all. Appellants themselves placed in evidence as exhibits 1950—1951 and 1951—1952 real estate tax bills for the 45th Avenue property. These were concededly brought to the attention of appellant Gerald D. Nelson, the 'active' or 'managing' trustee. On the face of the bills appears the word 'ARREARS,' with a prominent black arrow pointing to it and beneath the arrow the statement, 'The word ARREARS if it appears in the space indicated by the Arrow, means that, as of JUNE 30, 1950, previous TAXES, ASSESSMENTS OR WATER CHARGES HAVE NOT BEEN RECORDED AS PAID. If these have not been paid since June 30, 1950, payment should be made IMMEDIATELY.'6 Furthermore, the City's assistant corporation counsel stated in his affidavit that the tax bills for the Powell Street property each year from 1946 to 1953 contained a notice that the property was in arrears. Appellant Nelson stated that the bookkeeper 'had been regularly presenting to deponent for payment all of the bills for real estate taxes which were paid through the first half of 1951—52 * * *.'7 It is clear that the City cannot be charged with responsibility for the misconduct of the bookkeeper in whom appellants misplaced their confidence nor for the carelessness of the managing trustee in overlooking notices of arrearages
6
Appellants make the further contention that the City officials should have known from the state of the records of the two parcels that mailed notice would probably be ineffective. That is, the fact that water charges were not paid while the much larger real estate taxes were paid should have indicated to the officials that something was amiss. They rely on Covey v. Town of Somers, supra. We cannot so hold. In the Covey case, there were uncontroverted allegations that the taxpayer, who lived on the foreclosed property, was known by the officials of a small community to be an incompetent, unable to understand the meaning of any notice served upon her; no attempt was made to have a committee appointed for her person or property until after entry of judgment of foreclosure in an in rem proceeding. The affidavit of the assistant corporation counsel here states that there are more than 834,000 tax parcels in the City, and on the facts of this case the City cannot be held to a duty to determine why a taxpayer neglects some taxes while paying others.
7
We conclude, therefore, that the City having taken steps to notify appellants of the arrearages and the foreclosure proceedings and their agent having received such notices, its application of the statute did not deprive appellants of procedural due process.
8
2. Appellants also claim a denial of the equal protection of the laws in that the City officials had available to them other remedies for collecting taxes, which would not necessarily have resulted in forfeiture of the entire value of their property. Their theory is that the choice to proceed against their property under Title D, Chapter 17, was arbitrary. We find the contention without merit. The statute is explicit that when the strict foreclosure provisions of Title D, Chapter 17, are invoked, they must be used against all parcels in a section of the City on which charges have been outstanding for four years.8 It is clear that the aim is to prevent precisely the kind of discrimination of which appellants complain. Appellants do not assert that the statute was not complied with in this regard.
9
3. In their reply brief, appellants urged that by reasons of the City's retention of property, in one instance, and proceeds of sale in the other, far exceeding in value the amounts due, they are deprived of property without due process of law or have suffered a taking without just compensation. They called our attention to United States v. Lawton, 110 U.S. 146, 3 S.Ct. 545, 28 L.Ed. 100. In affirming a judgment in favor of a foreclosed landowner for the surplus proceeds from the sale of his land, the Court there said: 'To withhold the surplus from the owner would be to violate the fifth amendment to the constitution and to deprive him of his property without due process of law or to take his property for public use without just compensation.' 110 U.S., at page 150, 3 S.Ct. at page 547. However, the statute involved in that case had been construed in United States v. Taylor, 104 U.S. 216, 26 L.Ed. 721, to require that the surplus be paid to the owner, and there the problem was treated as purely one of statutory construction without constitutional overtones.9 But we do not have here a statute which absolutely precludes an owner from obtaining the surplus proceeds of a judicial sale. In City of New York v. Chapman Docks Co., 1 App.Div.2d 895, 149 N.Y.S.2d 679, an owner filed a timely answer in a foreclosure proceeding, asserting his property had a value substantially exceeding the tax due. The Appellate Division construed § D17—12.0 of the statute10 to mean that upon proof of this allegation a separate sale should be directed so that the owner might receive the surplus. What the City of New York has done is to foreclose real property for charges four years delinquent and, in the absence of timely action to redeem or to recovery any surplus, retain the property or the entire proceeds of its sale. We hold that nothing in the Federal Constitution prevents this where the record shows adequate steps were taken to notify the owners of the charges due and the foreclosure proceedings.
10
It is contended that this is a harsh statute. The New York Court of Appeals took cognizance of this claim and spoke of the 'extreme hardships' resulting from the application of the statute in this case. But it held, as we must, that relief from the hardship imposed by a state statute is the responsibility of the state legislature and not of the courts, unless some constitutional guarantee is infringed. In this connection, we note that the New York Legislature this year has ameliorated to some extent the severity of Title D, Chapter 17. Section D17—25.0 was added to the statute, permitting the reconveyance of property acquired and still held by the City upon payment of arrears, interest and the costs of foreclosure. The City concedes this amendment applies to the Powell Street property. Appellants have applied for a reconveyance of that property, and action has been held in abeyance pending the disposition of this appeal.
11
Affirmed.
1
The statute, § D17—1.0 et seq., enacted in 1948, provides for the judicial foreclosure of tax liens on real property. The city treasurer files in the appropriate county clerk's office a list of all parcels in a section or ward of the City on which tax liens have been unpaid for at least four years. Tax liens include unpaid taxes, assessments or water rents, interest and penalties. This filing constitutes the filing of a complaint and commences an action against the property. Provision is made for notice by posting, publication and mail. The notice must be mailed to the property owner at his last known address. The prescribed notice is to the effect that, unless the amount of unpaid tax liens, together with interest and penalties, are paid within 7 weeks or an answer interposed within 20 days thereafter, any person having the right to redeem or answer shall be foreclosed of all his right, title and interest and equity in and to the delinquent property. Provision is made for entry of a judgment of foreclosure awarding possession of the property to the City and directing execution of a deed conveying an estate in fee simple absolute to the City. The City may retain the property or sell it and retain the entire proceeds.
2
Appellants and the New York Court of Appeals used the figure $72.50. But the figures given in the affidavit of appellant Gerald D. Nelson (R. 68) yield a total of $65. Altogether, back charges, including those less than four years old, totaled $320.20. This includes $91.20 representing the second half of the 1948—1949 real estate taxes. No water charges were paid from 1945 on. All real estate taxes, with the exception noted, were paid.
3
§ D17—5.0.
4
§ D17—6.0.
5
For the years 1945 through 1947. No water charges had been paid since 1945, and the second half 1948—1949 real estate tax was not paid. The total delinquency was $2,681. R. 13—14.
6
The date on the other bill was June 30, 1951. Appellants introduced the tax bills as a basis for an argument that the City's error in continuing to bill them after the City had acquired title to the 45th Avenue property lulled them into thinking that all was well, so that they took no steps to protect the Powell Street property. The effect of the notice of arrears should, it seems, have been quite the opposite.
7
In addition, a deputy city collector annexed to his affidavit copies of letters sent to the trust estate on June 5 and July 9, 1951, advising that there had been double payments of the taxes on the 45th Avenue property.
8
§ D17—5.0, which provides for the filing of lists of delinquent property, provides further, 'Each such list shall comprise all such parcels within a particular section or ward designated on the tax maps of the city, except those parcels excluded from such lists as hereinafter provided.' The grounds for exclusion are (1) question raised as to the validity of the tax lien on the parcel, (2) and (3) accepted agreement to pay delinquent taxes in installments, and (4) tax lien on the property sold within two years and enforcement of the lien not completed.
9
See also Chapman v. Zobelein, 237 U.S. 135, 35 S.Ct. 518, 59 L.Ed. 874.
10
Section D17—12.0(a) provides in pertinent part, 'The court shall have full power * * * in a proper case to direct a sale of * * * lands and the distribution or other disposition of the proceeds of the sale.' By § D17—6.0 it is provided, 'Every person having any right, title or interest in or lien upon any parcel * * * may serve a duly verified answer * * * setting forth in detail the nature and amount of his interest or lien and any defense or objection to the foreclosure.'
| 34
|
352 U.S. 112
77 S.Ct. 200
1 L.Ed.2d 178
Lee WALKER, Appellant,v.CITY OF HUTCHINSON, Reno County, KANSAS, a Municipal Corporation, et al.
No. 13.
Argued Oct. 15 and 16, 1956.
Decided Dec. 10, 1956.
Mr. Herbert Monte Levy, New York City, for appellant.
Mr. Fred C. Littooy, Hutchinson, Kan., for appellees.
Opinion of the Court by Mr. Justice BLACK announced by Mr. Justice DOUGLAS.
1
The appellant Lee Walker owned certain land in the City of Hutchinson, Kansas. In 1954 the City filed an action in the District Court of Reno County, Kansas, to condemn part of his property in order to open, widen, and extend one of the City's streets. The proceeding was instituted under the authority of Article 2, Chapter 26 of the General Statutes of Kansas, 1949. Pursuant to s 26—201 of that statute1 the court appointed three commissioners to determine compensation for the property taken and for any other damage suffered. These commissioners were required by § 26—202 to give landowners at least ten days' notice of the time and place of their proceedings. Such notice could be given either 'in writing * * * or by one publication in the official city paper * * *.'2 The appellant here was not given notice in writing but publication was made in the official city paper of Hutchinson. The commissioners fixed his damages at $725, and pursuant to statute, this amount was deposited with the city treasurer for the benefit of appellant. Section 26—205 authorized an appeal from the award of the commissioners if taken within 30 days after the filing of their report. Appellant took no appeal within the prescribed period. Some time later, however, he brought the present equitable action in the Kansas District Court. His petition alleged that he had never been notified of the condemnation proceedings and knew nothing about them until after the time for appeal had passed. He charged that the newspaper publication authorized by the statute was not sufficient notice to satisfy the Fourteenth Amendment's due process requirements. He asked the court to enjoin the City of Hutchinson and its agents from entering or trespassing on the property 'and for such other and further relief as to this Court seem(s) just and equitable.'3 After a hearing, the Kansas trial court denied relief, holding that the newspaper publication provided for by § 26—202 was sufficient notice of the Commissioners' proceedings to meet the requirements of the Due Process Clause. Agreeing with the trial court, the State Supreme Court affirmed. 178 Kan. 263, 284 P.2d 1073. The case is properly here on appeal under 28 U.S.C. § 1257(2), 28 U.S.C.A. § 1257(2). The only question we find it necessary to decide is whether, under circumstances of this kind, newspaper publication alone measures up to the quality of notice the Due Process Clause of the Fourteenth Amendment requires as a prerequisite to proceedings to fix compensation in condemnation cases.
2
It cannot be disputed that due process requires that an owner whose property is taken for public use must be given a hearing in determining just compensation. The right to a hearing is meaningless without notice. In Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 70 S.Ct. 652, 94 L.Ed. 865, we gave thorough consideration to the problem of adequate notice under the Due Process Clause. That case establishes the rule that, if feasible, notice must be reasonably calculated to inform parties of proceedings which may directly and adversely affect their legally protected interests.4 We there called attention to the impossibility of setting up a rigid formula as to the kind of notice that must be given; notice required will vary with circumstances and conditions. We recognized that in some cases it might not be reasonably possible to give personal notice, for example where people are missing or unknown.
3
Measured by the principles stated in the Mullane case, we think that the notice by publication here falls short of the requirements of due process. It is common knowledge that mere newspaper publication rarely informs a landowner of proceedings against his property. In Mullane we pointed out many of the infirmities of such notice and emphasized the advantage of some kind of personal notice to interested parties. In the present case there seem to be no compelling or even persuasive reasons why such direct notice cannot be given. Appellant's name was known to the city and was on the official records. Even a letter would have apprised him that his property was about to be taken and that he must appear if he wanted to be heard as to its value.5
4
Nothing in our prior decisions requires a holding that newspaper publication under the circumstances here provides adequate notice of a hearing to determine compensation. The State relies primarily on Huling v. Kaw Valley Railway & Improvement Co., 130 U.S. 559, 9 S.Ct. 603, 32 L.Ed. 1045. We think that reliance is misplaced. Decided in 1889, that case upheld notice by publication in a condemnation proceeding on the ground that the landowner was a non-resident. Since appellant in this case is a resident of Kansas, we are not called upon to consider the extent to which Mullane may have undermined the reasoning of the Huling decision.6
5
There is nothing peculiar about litigation between the Government and its citizens that should deprive those citizens of a right to be heard. Nor is there any reason to suspect that it will interfere with the orderly condemnation of property to preserve effectively the citizen's rights to a hearing in connection with just compensation. In too many instances notice by publication is no notice at all. It may leave government authorities free to fix one-sidedly the amount that must be paid owners for their property taken for public use.
6
For the foregoing reasons the judgment of the Supreme Court of Kansas is reversed and the cause is remanded for further proceedings not inconsistent with this opinion. It is so ordered.
7
Reversed and remanded.
8
Mr. Justice BRENNAN took no part in the consideration or decision of this case.
9
Mr. Justice FRANKFURTER, dissenting.
10
Appellant contends that the provision of Kan.Gen.Stat.1949, § 26—202, allowing notice of the hearing on compensation to be given by one publication in the official city newspaper of itself violates the provision of the Fourteenth Amendment that no State shall 'deprive any person of life, liberty, or property, without due process of law * * *.'1 The first issue that faces us, however, is to decide from the pleadings exactly what it is that we must decide in this case.
11
Once appellant discovered that his land had been condemned and that the time for appeal from the award of the commissioners had passed, various possible courses of action, followed separately or in combination and each raising different issues, were open to him. If he considered the award fair but still desired to keep his land, he could have contended that unconstitutionality of the notice for the hearing on compensation invalidated the taking. If he considered the award unfair, he could have alleged in an appropriate action the unconstitutionality of the notice of the compensation hearing and the inadequacy of the compensation and sought to obtain fair compensation, see Ward v. Board of County Com'rs of Love County, 253 U.S. 17, 40 S.Ct. 419, 64 L.Ed. 751, or to restrain entry onto his land until he received a hearing under Kan.Gen.Stat.1949, § 26—202, or, making a further allegation of the invalidity of the taking, to obtain a permanent injunction. At this stage, it is not relevant for me to imply any opinion on the merits of any of these possible courses of action.
12
On a fair reading of the complaint, appellant chose to pursue only the first course. The theory of his action, an attempt to restrain the city from trespassing on his land, is that he still has the right to possession. His petition for injunction based this right to possession solely on the allegation that the statutory notice was insufficient. Nowhere in his petition for an injunction does appellant make any factual allegation that the money deposited by the commissioners did not represent the fair value of his land and therefore left him out of pocket. Nowhere did he indicate that he wanted an injunction only until he received a hearing. The whole theory of his petition is that the property that was being taken without due process of law was his land, not its money value.2
13
In a memorandum filed after oral argument in this Court, appellant contends that the allegation of 'irreparable damage' is a sufficient allegation of monetary loss. He states: 'Of course, there could be no irreparable damage—indeed there could be no damage at all—unless the amount of the award was less than the actual value of the property. Had this been an action for damages, then an allegation of the differences in value would logically have been found in the petition. But it was an injunction proceeding.'
14
But an allegation of 'irreparable damage' is merely a legal conclusion, flowing from, and justified by, the necessary allegation of facts warranting injunctive relief. The usual factual assertion underlying such an allegation in a suit to restrain trespass is that the threatened continuous nature of the entry represents the 'irreparable damage.' Indeed, in his petition for injunction, appellant made the usual factual assertion, immediately preceding the prayer for relief:
15
'That at the present moment defendant City of Hutchinson, either itself, or by contractors employed by it, is, or is threatening to enter upon said real estate owned by the Plaintiff, and this for the purpose of building a highway across said real estate, all in utter and complete disregard of the rights of this Plaintiff.'
16
In view of this assertion and the absence of any other assertion with respect to 'irreparable damage,' appellant's claim that monetary loss is alleged is baseless.
17
If the Kansas Supreme Court had construed the pleading of 'irreparable damage' as implying a factual assertion that the award was less than the fair value of the land, I would accept that construction. See Saltonstall v. Saltonstall, 276 U.S. 260, 267—268, 48 S.Ct. 225, 226, 72 L.Ed. 565. But the Kansas Supreme Court did not construe the pleadings at all. It decided the case by upholding the constitutionality of the statute. Kansas has a right to make such an abstract determination for itself. This Court, however, can decide only 'Cases' or 'Controversies.' U.S.C.onst., Art. III, § 2. It has no constitutional power to render advisory opinions. To assume that the Kansas courts construed these pleadings sub silentio as alleging monetary loss is to excogitate. A much more probable inference is that since the issue so controlling for this Court's jurisdiction was not raised in the pleadings, the Kansas court did not concern itself with it. In any event, lacking an explicit construction of the pleadings by the Kansas courts, we must construe the pleadings ourselves to decide what constitutional questions are here raised on the record as it comes to us. See Doremus v. Board of Education, 342 U.S. 429, 432, 72 S.Ct. 394, 396, 96 L.Ed. 475.
18
In my view, the only constitutional question raised by appellant is whether failure to give adequate notice of the hearing on compensation of itself invalidates the taking of his land, apart from any claim of loss. We have held many times that the State's interest in the expeditious handling of condemnation proceedings justifies the taking of land prior to payment, without violating the Due Process Clause, so long as adequate provision for payment of compensation is made. See, e.g., Bragg v. Weaver, 251 U.S. 57, 62, 40 S.Ct. 62, 64, 64 L.Ed. 135. Appellant must be able to show that the provisions for payment, as they operated in his case, were inadequate before he can attack the Kansas statutory scheme for compensation in condemnation cases. See Ashwander v. T.V.A., 297 U.S. 288, 347, 56 S.Ct. 466, 483, 80 L.Ed. 688 and cases cited note 6 (Brandeis, J., concurring); cf. Smith v. State of Indiana, 191 U.S. 138, 148—149, 24 S.Ct. 51, 52, 48 L.Ed. 125. Since on the record before us the compensation was not alleged to be inadequate, the taking was valid and the judgment of the Kansas Supreme Court should be affirmed. At the very least, the case should be returned to the Kansas court so that we may have the benefit of its construction of the pleadings. See Honeyman v. Hanan, 300 U.S. 14, 57 S.Ct. 350, 81 L.Ed. 476.
19
But the Court, without explicitly construing the pleadings, passes upon the constitutionality of Kan.Gen.Stat.1949, § 26—202. Without intimating any opinion whether in the circumstances of this case appellant was denied the due process required in determining fair compensation for property taken under the power of eminent domain, I feel constrained to point out that the Court's decision does not hold the taking itself invalid and therefore does not require the Kansas court to grant an injunction so long as appellant's rights are protected.
20
APPENDIX.
21
'In District Court of Reno County, Kansas
22
'Amended Petition
23
'Comes now Lee Walker, the plaintiff herein, by his attorneys, Oswald & Mitchell, and for his cause of action against the City of Hutchinson, Reno County, Kansas, T. E. Chenoweth, City Manager, Robert G. King, Mayor and Members of the City Commission, Charles N. Brown, Jerry Stremel, R. C. Woodward and C. E. Johnson, Members of the City Commission, all of the City of Hutchinson, Reno County, Kansas, respectfully states to the Court:
24
'2. That the Plaintiff is a resident of Hutchinson, Reno County, Kansas, and that his post office address is 907 East 11th Street, Hutchinson, Kansas; that he is a Negro; that he was born in Bargtown, Kentucky on the 15th day of October, 1875; and that he had, as a youth, an education equivalent to the Sixth Grade.
25
'3. That Defendant City of Hutchinson, Reno County, Kansas is a municipal corporation; that the above named individual Defendants are respectively T. E. Chenoweth, City Manager, Robert G. King, Mayor and a member of the City Commission, Charles N. Brown, Jerry Stremel, R. C. Woodard and C. E. Johnson, members of the City Commission, all of the City of Hutchinson.
26
'4. That on or about the 27th day of February, 1905, the Plaintiff acquired fee simple title through a Warranty Deed, duly executed by one Arthur Walker, which deed was duly recorded with the Register of Deeds of Reno County, Kansas, on the 28th day of February, 1905, in Book 85, Page 479, to the following described real estate, all situated in Reno County, Kansas:
27
'Lots thirty-seven (37), thirty-eight (38), thirty-nine (39), forty (40), forty-one (41), forty-two (42), forty-three (43), forty-four (44), forty-five (45), forty-six (46), forty-seven (47) and forty-eight (48), Block Five (5), Maple Grove Addition to the City of Hutchinson,
28
'and ever since that time, the Plaintiff has owned same, enjoyed quiet and peaceful possession thereof and likewise has had and enjoyed all the fruits of such ownership, and has paid, from time to time, all assessments and taxes of every kind and nature legally assessed against said real estate; that he is therefore now the legal and equitable owner of said real estate.
29
'5. That on or about the 12th day of April, 1954, the defendant City of Hutchinson, through its duly elected or appointed, qualified and acting officials, filed an action in the District Court of Reno County, Kansas, entitled:
30
'In the matter of the application of the city of Hutchinson, Kansas, a municipal corporation, for the appointment of commissioners in the matter of the condemnation of property for the acquisition of right of way for the opening, widening and extending of portions of Eleventh Avenue, Harrison Street and Twenty-third Avenue in the city of Hutchison, Kansas,
31
'the same being docketed as Case No. 7867.
32
'6. That said action was for the purpose of taking from the Plaintiff and condemning certain portions of the above described real estate, as a by-pass, so to speak, for Hutchinson's Super-Sports Arena.
33
'7. That the Plaintiff has never been, at any time, notified in any manner that the City of Hutchinson coveted the bit of real estate as a by-pass to Hutchinson's Super-Sports Arena he has owned since 1905; nor has he ever been served with any summons, nor given any other personal notice of any kind whatsoever that said defendant City of Hutchinson had filed the aforesaid action for the purpose of taking a part of his said real estate.
34
'8. That the pretended right of defendant City of Hutchinson to the real estate above legally described, owned by the Plaintiff, rests upon the authority, so far as this Plaintiff and counsel have been able to ascertain, of G.S. 26—201 and 26—202, and Reno County, Kansas District Court Case No. 7867, more fully described in Paragraph 5 herein, brought thereunder, which statute or statutes are void and of no force and effect whatsoever, because same attempt to vest the power in certain municipalities to take property without due process of law.
35
'9. That the only notice to an owner of real property, which G.S. 26—201 and 26—202 requires is by publication, which is not sufficient notice under the above mentioned due process clauses of both Federal and State Constitutions.
36
'10. That the Plaintiff had no actual notice, and did not actually know, or have any reason to know that Defendants sought to condemn and take his land, until approximately the middle part of August, 1954; unless by a peculiar quirk of the imagination, it can be said that the single legal publication, published just once in The Hutchinson News-Herald, and that on the 14th day of April, 1954, gave him notice; that said single notice so published in the official newspaper was not sufficient notice to satisfy the requirements of the Due Process clauses of both Federal and State Constitutions.
37
'11. That at the present moment defendant City of Hutchinson, either itself, or by contractors employed by it, is, or is threatening to enter upon said real estate owned by the Plaintiff, and this for the purpose of building a highway across said real estate, all in utter and complete disregard of the rights of this Plaintiff.
38
'12. That the Plaintiff is entitled to an Order of this Court instanter, enjoining and restraining defendant City of Hutchinson from entering upon, or in any manner trespassing upon said real estate, for the reason, inter alia, that there is no other remedy, either at law or in equity, open to the Plaintiff; that if said defendant City of Hutchinson is not so restrained and enjoined, the Plaintiff will suffer irreparable damage by reason thereof.
39
'13. That the Plaintiff is advised that in some orders by Courts of competent jurisdiction, in the granting of a restraining order, or temporary injunction of this nature, the party seeking same, and obtaining same, is required to post certain indemnity or other type of bond or bonds; that the Plaintiff hereby respectfully and humbly advises the Court that by reason of his limited financial resources, he cannot post such a bond, and therefore asks, upon the above and foregoing statement of facts, that the Court does not make the giving of such a bond or bonds as a condition precedent to Plaintiff's obtaining a restraining order or temporary injunction at this time.
40
'14. That by reason of the above and foregoing facts, the Plaintiff is entitled to have, and desires to have a permanent injunction against defendant City of Hutchinson, restraining and enjoining it, and its servants, agents and all others in its employment, from entering or trespassing upon the Plaintiff's real estate, above described, or preventing him from otherwise enjoying the quiet and peaceful enjoyment thereof.
41
'Wherefore and by reason of the foregoing, the Plaintiff prays for an immediate Order of this Court restraining and enjoining defendant City of Hutchinson from entering or trespassing upon the Plaintiff's real estate, above described. and the Plaintiff further prays for a judgment of this Court permanently enjoining and restraining the City of Hutchinson from entering or trespassing upon Plaintiff's real estate, above described; and Plaintiff further prays for judgment for his costs herein, and for such other and further relief as to this Court seem just and equitable.'
42
Mr. Justice BURTON, dissenting.
43
If the issue in this case is the constitutionality of the statutory provision made for taking the property, its constitutionality seems clear. If, as I assume to be the case, the issue is the constitutional sufficiency of the statutory ten-day notice by publication of the hearing to assess the compensation for the land taken, I consider such a provision to be within the constitutional discretion of the lawmaking body of the State.
44
In weighing the 'due process' of condemnation procedure some reasonable balance must be struck between the needs of the public to acquire the property, and the opportunity for a hearing as to the compensation to be paid for the property. Just compensation is constitutionally necessary, but the length and kind of notice of the proceeding to determine such compensation is largely a matter of legislative discretion. The minimum notice required by this statute may seem to some to be inadequate or undesirably short, but it was satisfactory to the lawmakers of Kansas. It also has been upheld by the Supreme Court of Kansas and the United States Court of Appeals for the Tenth Circuit. To proscribe it as violative of the Federal Constitution fails to allow adequate scope to local legislative discretion. Accordingly, while not passing upon the desirability of the statutory requirement before us, I am not ready to hold that the Constitution of the United States prohibits the people of Kansas from choosing that standard. Particularly, I am not ready to throw a nationwide cloud of undertainty upon the validity of condemnation proceedings based on compliance with similar local statutes. Since 1889, it has been settled that notice by publication in condemnation proceedings to take and to fix the value to be paid for the land of a nonresident comports with due process. Huling v. Kaw Valley Ry. & Imp. Co., 130 U.S. 559, 9 S.Ct. 603, 32 L.Ed. 1045. See also, North Laramie Land Co. v. Hoffman, 268 U.S. 276, 283—287, 45 S.Ct. 491, 494—495, 69 L.Ed. 953; Bragg v. Weaver, 251 U.S. 57, 40 S.Ct. 62, 64 L.Ed. 135.
45
I agree with the court below and with the opinion of the Court of Appeals for the Tenth Circuit rendered in the comparable case of Collins v. City of Wichita, 225 F.2d 132, which came to our attention at the last term of Court and in which certiorari was denied on November 7, 1955, 350 U.S. 886, 76 S.Ct. 140. Therefore, I would affirm the judgment here.
1
Section 26—201 reads in part as follows:
'Private property for city purposes; survey; ordinance fixing benefit district; application to district court; commissioners. Whenever it shall be deemed necessary by any governing body of any city to appropriate private property for the opening, widening, or extending any street or alley, * * * the governing body shall cause a survey and description of the land or easement so required to be made by some competent engineer and file with the city clerk. And thereupon the governing body shall make an order setting forth such condemnation and for what purpose the same is to be used. * * * The governing body, as soon as practicable after making the order declaring the appropriation of such land necessary * * * shall present a written application to the judge of the district court of the county in which said land is situated describing the land sought to be taken and setting forth the land necessary for the use of the city and * * * praying for the appointment of three commissioners to make an appraisement and assessment of the damages therefor.'
2
Section 26—202 read in part as follows:
'Notice to property owners or lienholders of record; appraisement and assessment of damages; reports. The commissioners appointed by the judge of the district court shall give any owner and any lienholder of record of the property sought to be taken at least ten days' notice in writing of the time and place when and where the damage will be assessed, or by one publication in the official city paper, and at the time fixed by such notice shall, upon actual view, appraise the value of the lands taken and assess the other damages done to the owners of such property, respectively, by such appropriations. For the payment of such value and damages the commissioners shall assess against the city the amount of the benefit to the public generally and the remainder of such damages against the property within the benefit district which shall in the opinion of the appraisers be especially benefited by the proposed improvement. The said commissioners may adjourn as often and for such length of time as may be deemed convenient, and may, during any adjournment, perfect or correct all errors or omissions in the giving of notice by serving new notices or making new publication, citing corporations or individual property owners who have not been notified or to whom defective notice or insufficient notice has been given, and notice of any adjourned meeting shall be as effective as notice of the first meeting of the commissioners * * *.'
3
Although the relief prayed for was an injunction against the taking, the Supreme Court of Kansas evidently construed the pleadings as adequately raising the question whether notice was sufficient to assure the constitutionality of the compensation procedure; in its opinion it passed only on § 26—202, dealing with the latter problem. Since Kansas requires a showing of actual damage for standing to maintain an equity suit, McKeever v. Buker, 80 Kan. 201, 101 P. 991, and since the Kansas court took the complaint as alleging damage as a result of the compensation rather than the taking procedure, the pleading was evidently treated by the state court as alleging monetary damage resulting from the lack of notice in connection with compensation. We accept this construction of the complaint by the Kansas court as sufficient allegation of damage. See Bragg v. Weaver, 251 U.S. 57, 40 S.Ct. 62, 64 L.Ed. 135, where the adequacy of notice of compensation proceedings was passed on by this Court in an injunction suit like this one.
4
We applied the same rule in Covey v. Town of Somers, 351 U.S. 141, 76 S.Ct. 724; see also City of New York v. New York, N.H. & H.R. Co., 344 U.S. 293, 73 S.Ct. 299, 97 L.Ed. 333.
5
Section 26—202 was amended in 1955, after this Court's decision in Mullane, to require that the city must give notice to property owners by mailing a copy of the newspaper notice to their last known resident, unless such residence could not be located by diligent inquiry. Kan.Gen.Stat.1949 (Supp.1955), § 26—202.
6
The State also relies on North Laramie Land Co. v. Hoffman, 268 U.S. 276, 45 S.Ct. 491, 494, 69 L.Ed. 953, and Bragg v. Weaver, 251 U.S. 57, 40 S.Ct. 62, 64 L.Ed. 135. But the holdings in those cases do not conflict with our holding here. The North Laramie case upheld c. 73, § 2, of the 1913 Laws of Wyoming, which provided for notice by publication in a newspaper and required that a copy of the newspaper must be sent to the landowner by registered mail. This Court's opinion stated at p. 282 that: 'The Supreme Court of Wyoming held that the procedure followed complied with the statutory requirements. By that determination we are bound.' In Bragg v. Weaver, supra, 251 U.S. at pages 61—62, 40 S.Ct. at page 64, this Court stated that the controlling Virginia statute provided that a landowner must be notified 'in writing and shall have thirty days after such notice within which to appeal. * * * It is apparent therefore that special care is taken to afford him ample opportunity to appeal and thereby to obtain a full hearing in the circuit court.'
1
The important statutory provisions of the Kansas condemnation procedure are set forth in the opinion of the Court, except for the provision in Kan.Gen.Stat.1949, § 26—204, that title to lands condemned for parkways or boulevards vests in the city immediately on publication of the resolution of condemnation and that the city's right to possession of condemned land vests when the report of the commissioners is filed in the office of the register of deeds. Kan.Gen.Stat.1949, § 26—204, is as follows:
'That the city clerk shall forthwith upon any report (of assessment commissioners) being filed in his office, prepare and deposit a copy thereof in the office of the treasurer of such city, and if there be deposited with the city treasurer, for the benefit of the owner or owners of such lands, the amount of the award, such treasurer shall thereupon certify such facts upon the copy of the report, and shall pay said awards to such persons as shall be respectively entitled thereto. * * * The title to lands condemned by any city for parks, parkways or boulevards shall vest in such city upon the publication of the resolution of the governing body condemning the same. Upon the recording of a copy of said report so certified in the office of the register of deeds of the county, the right to the possession of lands condemned shall vest in the city and the city shall have the right to forthwith take possession of, occupy, use and improve said lands for the purposes specified in the resolution appropriating the same.'
2
The complaint in its entirety is set forth in an Appendix at the end of this opinion, 352 U.S. 122, 77 S.Ct. 205.
| 34
|
352 U.S. 158
77 S.Ct. 241
1 L.Ed.2d 211
UNITED STATES of America, Appellant,v.INTERSTATE COMMERCE COMMISSION and United States of America.
No. 12.
Argued Oct. 11, 1956.
Decided Dec. 17, 1956.
[Syllabus from pages 158-159 intentionally omitted]
Mr. Ralph S. Spritzer, Washington, D.C., for appellant.
Mr. Robert W. Ginnane, Washington, D.C., for appellee Interstate Commerce Commission.
Mr. Windsor F. Cousins, Philadelphia, Pa., for railroad appellees.
Mr. Justice REED delivered the opinion of the Court.
1
This appeal requires a determination of whether railroads serving the port of Norfolk, Virginia, must grant the United States an allowance for the Government's performance of certain wharfage and handling services on its own export freight. For shippers who conform to the requirements of the tariff, the railroads assume these charges as a part of the rate. The United States, however, found it impractical to conform to the tariff requirements.
2
The present litigation was instituted pursuant to 28 U.S.C. § 2325, 28 U.S.C.A. § 2325, in a three-judge District Court of the District of Columbia by the United States, through its Department of the Army, against the Interstate Commerce Commission and the United States, to set aside the Commission's order in United States v. Aberdeen & Rockfish R. Co., 289 I.C.C. 49. That order dismissed a complaint filed by the United States on November 20, 1951, against several named railroads charging them with violations of the Interstate Commerce Act, 49 U.S.C.A. § 1 et seq. The District Court, one judge dissenting, dismissed the complaint. 132 F.Supp. 34. We noted probable jurisdiction. 350 U.S. 930, 76 S.Ct. 302.
3
Since May 1, 1951, the railroads have refused to pay an allowance to the Army for the wharfage and handling1 services the Army performs on military export traffic passing through Army base piers in Norfolk, Virginia. The railroads have assumed in their tariffs the obligation to furnish these accessorial services for all shippers that comply with their tariffs. And, in accordance with these tariffs, the railroads have furnished the services for commercial shippers at public sections of the same piers without additional charge. These services were performed for the Army and the railroads by the same private company—for the Army under contract to carry out its orders for terminal and storage services; for the railroads by contract to act as the carriers' agent in accordance with their tariffs.
4
The Army sought a determination that the railroads' refusal to make an allowance to it to the same extent that the railroads paid the private company, Stevenson & Young, for handling of private shipments subjected the Government to unjust discrimination and constituted an unreasonable practice in violation of §§ 1, 2, 3, and 6 of the Interstate Commerce Act.2 The Army also requested an order that the railroads cease and desist from such refusal in the future.3
5
The transfer of export freight from rail carriers to outbound water carriers is made on piers or wharves that allow the unloading of freight from railroad cars to within reach of ships' tackle. Railroads are under no statutory obligation to furnish such piers or to unload carlot freight, Pennsylvania R. Co. v. Kittaning Iron & Steel Mfg. Co., 253 U.S. 319, 323, 40 S.Ct. 532, 533, 64 L.Ed. 928.4 In general the railroads have taken on the duty of wharfage and handling for freight consigned for overseas shipment.5 In some instances railroads have charged for the use of the piers ('wharfage') and the necessary 'handling' separately from their charge for line-haul transportation. In other cases there has been only a single factor export rate (one inclusive charge) providing for limited shipside delivery with the railroad furnishing these accessorial services pursuant to their tariffs at no extra charge to the shipper. The latter practice has been generally followed by railroads serving North Atlantic ports. Where railroads do not have their own piers, they have provided these services by contracting with commercial terminal operators.
I.
6
The Norfolk piers, involved in this matter, were managed by such operators. They were built by the United States after World War I and have been leased in part or in whole to a series of commercial operators since then. The leases were cancelled during World War II but they were leased to Stevenson & Young, a private terminal operator, at tne end of that war. The railroads here involved, using the single factor shipside rate described above, contracted with Stevenson & Young, as their agent, to perform the wharfage and handling for 25¢ per ton for wharfage and 75¢ per ton for handling on both commercial and military freight. But with the advent of the Korean hostilities, the Government again cancelled the leases and the Army took entire control of the piers. Apparently the military shipments require special handling and storage. To assure its complete satisfaction, the Army hired Stevenson & Young to perform those services under a general pier-operating contract for the Army.6 The unused portions of the piers were later released by the Government, by a contract dated December 28, 1951, for the commercial operations of Stevenson & Young. By that contract Stevenson & Young leased the unused parts for 1952 from the United States, for a public commercial maritime terminal. It was over these leased portions of the piers that the lessee carried on its public warehousing activities in accordance with the railroad tariffs.
7
A typical tariff arrangement appears in the note below. It is the basic exhibit in this case.7 It was bottomed on a contract of April 5, 1947, between the Pennsylvania Railroad and Stevenson & Young. By that contract Stevenson & Young, as a public wharfinger, agreed to act 'as directed by the Railroad' and as its agent for wharfage and handling of 'export, import, coastwise and intercoastal freight' in accordance with the tariff upon the facilities it acquired on the Army base. The agent assumed responsibility for freight charges and care of freight in its charge. It agreed, paragraph 4, that:
8
'The Terminal (Stevenson & Young) shall provide adequate facilities for the handling and storage of the freight subject to this agreement, shall provide access to the Railroad or its agent, the Norfolk and Portsmouth Belt Line Railroad, for the delivery of cars to and from shipside without interference or interruption, and shall load and unload cars promptly without delay of freight or railroad equipment.'
Paragraph 13 said:
9
'This agreement shall terminate absolutely and immediately whenever the Terminal ceases to operate the said facilities as a public wharfinger for the handling of freight, and in any event shall be terminable by either party on thirty days notice in writing.'
10
A large amount of private commercial traffic continued over the released portions of the piers, and the railroads continued to absorb the cost of that wharfage and handling by paying Stevenson & Young $1.00 per ton of freight.
11
The result of the Army's insistence on operating its own pier facilities is that the Army pays the same export rates without receiving wharfage and handling services as commercial shippers do for whom the railroads provide those services at no additional charge. Because the Army provides these services itself, it claims a right to the $1.00 per ton payment paid by the railroads on behalf of the commercial shippers.
12
In terms of the Interstate Commerce Act, the Government bases its argument on two grounds:
13
'The railroads' refusal to absorb wharfage and handling charges on Army freight to the same extent that they absorb such charges on civilian freight moving over the same piers under identical rates is unjustly discriminatory in violation of Section 2 of the Interstate Commerce Act.'
14
and
15
'The railroads' refusal to pay for wharfage and handling on Army freight was an unjust and unreasonable practice in violation of Section 1(6) of the Act.' It should be noted that the United States is not attacking the form of the tariff, which provides for both line-haul service and the accessorial services in the single factor export rate.8 Consequently, this case involves only charged discrimination and injustice. Cf. United States v. Interstate Commerce Commission, 337 U.S. 426, 437—438, 69 S.Ct. 1410, 1416, 1417, 93 L.Ed. 1451. In short, the United States seeks to be excepted from the tariff requirement that calls for the shipper to use a public wharfinger under contract to the railroads for performance of the wharfage and handling.9
16
This controversy is similar to one that arose out of the Army's cancellation of the Norfolk pier leases during World War II, United States v. Aberdeen & Rockfish R. Co., 269 I.C.C. 141. Interpreting railroad practices much like those now before this Court, the I.C.C. determined that the Army was not being discriminated against. However, on review, the Court of Appeals for the District of Columbia remanded the case to the I.C.C. for further exposition and clarification. 91 U.S.App.D.C. 178, 198 F.2d 958. On remand the I.C.C. reaffirmed its earlier determination and no appeal has been taken from that order. 294 I.C.C. 203. Because the question of whether the Army was discriminated against following the Government's World War II lease cancellation has never been finally passed upon, the District of Columbia ruling is not inconsistent with the Commission's conclusion in this litigation.
II.
17
The Government asserts that it is charged more on its export shipments through the Norfolk Army Base than commercial shippers under substantially similar circumstances. Such an exaction would be, of course, an unjust and unreasonable practice of discrimination. But it seems apparent that the circumstances of Army shipments are markedly different from those of private shippers that receive wharfage and handling services. Moreover, it seems equally clear that the Army is treated identically with those shippers who for business reasons do not care to comply with the tariff requirements.
18
The Army routed its export shipments direct to itself at the Army base as consignee. As is shown by the contracts summarized above, the entire Army base property was under military control except for the commercial operations of Stevenson & Young. The base included piers, bulkheads, railways and storage warehouses, and railroad switches, tracks and yards. The Commission found that the Army had determined 'that ports of embarkation must be operated by personnel of the military service and civilian employees of the Government.' 289 I.C.C., at 53.10
19
Although the Army hired the Stevenson company to operate the Army portion of the base, the Army's control was 'absolute.'
20
'(An Army yardmaster) is on duty at all times to give instructions for disposition of cars of Army freight delivered at the base. When either the Belt Line or the Virginian has cars for delivery, the yard clerk at the base is notified by telephone. If placement at a pier or warehouse is ready for any of those cars, the carrier is told where to make delivery. These instructions are confirmed in writing and handed to the conductor when he arrives at the base. Cars for which placement orders are not ready are left in the pier No. 1 yard by the Belt Line and in the uptown yard by the Virginian, in accordance with a general understanding as to the disposition of such cars.' 289 I.C.C., at 54—55.
21
Such direction was necessary. As the Commanding Officer said, in regard to switching and placing by the carriers:
22
'The Witness: If you would let them switch themselves, that have to know what they are doing, we have to give them the switch list and know what to do with it.
23
'Q. Will you permit them to do it at their own convenience, in an orderly manner? A. I don't know how any business can be run, if you run it at the convenience of someone else. They couldn't possibly to it at their own convenience, unless their convenience coincided with our requirement.
24
'Q. And yet you couldn't permit the terminal operator to operate in a normal way. A. No, because that involves a management problem. You would have to have a management team in here to settle the accounts of the terminal operator. They don't work for nothing, as you quite well know. Somebody has to monitor all that, manage the whole thing, and direct the bringing in of the cargo. That is all in over-lay staff of ours, which is large enough.'
25
This Army control over the movement of freight of those portions of the piers that were not leased to Stevenson & Young left the railroads serving the base without authority in those areas to direct the switching, spotting and removal of the cars according to their own convenience. 289 I.C.C., at 64.
26
The fact that the Army controls its areas of the base, and the fact that the railroads handle their own wharfage and switching on their portions as they choose, are not mere formal differences. They are factors in traffic movement.
27
'It is the right of every shipper including the Government as here concerned, to prohibit a carrier from performing switching upon private tracks, even though the carrier might be willing and able to perform the service. When so prohibited by the shipper, as was here done by the Army, the carrier's obligation to perform the service is discharged, and the payment of allowances to the shipper for its performance of the service, in whole or in part, would be unlawful, except as a voluntary concession of the carriers to the Government under section 22.' 289 I.C.C., at 65.
28
The problems of the assumption by the carriers of the costs of wharfage and handling at ports have a long history. The Norfolk area has not been an exception, as has been heretofore indicated. See 352 U.S. 168, 77 S.Ct. at page 247, supra. When the Government again in 1951 found it desirable to cancel the leases, it was familiar with the various facets of the controversy over wharfage and handling.11
III.
29
It is obvious that the method of handling government freight does not comply with the tariff requirements. It does not move over wharf properties owned, leased and operated by the Stevenson company 'as a public terminal facility of the rail carriers.' Rule 47(b), n. 7, supra.
30
'At all times during that period, military traffic was stored on and handled over wharf and other properties on the Army Base which were under the exclusive control of the Army.' 289 I.C.C., at 60.
31
Any deviation from tariffs by carriers violates § 6(7) of the Act, 49 U.S.C., 49 U.S.C.A. § 6(7), unless they grant a concession under § 22.12
IV.
32
The Government actually is being treated just as any shipper who decides not to take advantage of the services offered in the tariff. It seeks a preference over these other shippers who take deliveries of export rate traffic at piers under their own control, so-called private piers. The general practice at North Atlantic ports is to refuse to absorb handling charges at private piers, even though they are absorbed where the carriers have control of the facilities. The record shows 84 private piers along the Atlantic Coast where the railroads make no allowance or compensation for handling or wharfage. It was testified:
33
'One of the principal limitations on the port practices which I shall mention is the restriction of the loading practice to railroad or other public piers, as distinguished from private piers operated by shippers.'
34
There was no evidence to the contrary and the Commission accepted that situation as a fact. 289 I.C.C., at 58, 61, 63. The difference between a public and a private pier under the tariffs is whether the railroads have control of the areas directly or through their agents, or whether the shipper or consignee has control.
35
There is no objection to such a practice generally, whether the line-haul rates and the handling rates are stated in a single factor rate or separately. To require the carriers to furnish such accessorial services at every private pier would disperse the traffic, cause the maintenance of more crews or watchmen, and thus add to the cost of transportation.
36
The Government contends that it is not in the same position as other shippers who control private piers, because it took control of the Norfolk piers to meet a national emergency. But we think that the emergency cannot convert the Government's operation of its private piers into a category different from that of private shippers.13 And the fact that the operations of the Government and the railroads are in the same pier area seems to us immaterial. If the railroads gave an allowance here, excepting one given under § 22 of the Act, they would have to give it at all private piers where the shipper wanted to handle wharfage at its own discretion. Cf. Merchants' Warehouse Co. v. United States, 283 U.S. 501, 51 S.Ct. 505, 75 L.Ed. 1227; Weyerhaeuser Timber Co. v. Pennsylvania R. Co., 229 I.C.C. 463.
37
The Government has the right to have its shipments accorded the same privileges given others. Moreover, in emergencies its traffic may have 'preference or priority in transportation,' 49 U.S.C. § 1(15), 49 U.S.C.A. § 1(15), d and it may be granted and may accept preferences in rates.14 But the Government cannot otherwise require extra services or allowances. In the situation here presented, it could have used the same facilities as commercial shippers and obtained the benefits of the tariff. The evidence to this effect is uncontradicted.15 The Commission accepted it as a fact. 289 I.C.C. at 58, 60—61, 63.
V.
38
The Commission drew from the above circumstances a conclusion that the tariffs and conduct of the railroads are not shown to have been unlawful.
39
The United States argues that carriers cannot perform accessorial services in such a way that 'some shippers would pay an identical line-haul rate for less service than that required by other industrial plants.' United States v. United States Smelting, Refining & Min. Co., 339 U.S. 186, 197, 70 S.Ct. 537, 544, 94 L.Ed. 750. To do so would indeed violate § 2 of the Interstate Commerce Act.16 But the Smelting case is not apposite. We affirmed a Commission order enjoining intra-plant car switching and spotting services after termination of the line haul. It terminated at a 'convenient point' on a siding at consignee's plant. Our decision there turned on and upheld the Commission's power to determine the end point of the line haul. Because the line-haul tariffs included only car movement to and from that convenient point, some shippers received more service than others for the line-haul rate. 339 U.S. at page 197, 70 S.Ct. at page 543.17 Thus our determination was based on the unlawful preference allowed some shippers by the tariffs since those discriminated against could not get the same service as other shippers.
40
Furthermore, whether the circumstances and conditions are sufficiently dissimilar to justify differences in rates or charges is a question of fact for the Commission's determination.18
41
The District Court dismissed the complaint on the record before the Commission, and we affirm.
42
Affirmed.
43
Mr. Justice BRENNAN took no part in the consideration or decision of this case.
44
Mr. Justice BLACK, with whom The CHIEF JUSTICE concurs, dissenting.
45
From the very beginning the Interstate Commerce Act has made it unlawful for railroads to discriminate by charging some shippers more than others for carrying the same kind of freight the same distance. The provisions of the Act make it clear that the ban on such discrimination cannot be evaded by any contrivance or guise that accomplishes the prohibited end. In the present case the undisputed evidence, as well as the Interstate Commerce Commission's findings, convinces me beyond doubt that the railroads are subjecting the United States, as a shipper, to precisely the kind of discrimination which the Act prohibits. When the mass of verbiage which has befogged this case is stripped away, the issues are not complex and no expert guidance is needed for their proper resolution.
46
The Government owns several piers at Norfolk, Virginia which are connected by tracks with the main lines of certain major railroads. Storage space is provided on the piers for freight. For many years the piers were leased to a private terminal operator. This operator has a contract which the railroads hauling to the piers to perform handling and wharfage services with respect to their freight. The railroads pay the operator $1 per ton for these services. They do not charge shippers separately for this handling and wharfage but instead include the cost with the transportation charges in a single line-haul rate.
47
Shipments by the United States through the piers were handled exactly the same as any other shipment. The operator, acting under contract with the railroads, performed the necessary unloading and storage; the railroads paid it $1 per ton for these services; and the Government paid the railroads the single rate covering both transportation and pier services. The Government was not required to pay anything in addition to this single rate.
48
In 1951, however, with the outbreak of the Korean conflict, the Government found it necessary to operate directly certain portions of the piers in order to facilitate the shipment of military supplies. The Government hired the same operator who was acting for the railroads to perform the same services in handling government shipments as he had before. The sole difference was that the operator acted under contract with the Government and was paid by it rather than by the railroads. The railroads continued to charge the same line-haul rate as before, however, on government shipments. The Government requested that the railroads continue to pay the $1 per ton for handling and wharfage of its shipments. The railroads refused. The net result is that the Government receives less services from the railroads than other shippers although it pays the same rate. Or stated in a more familiar manner it is compelled to pay more than other shippers for the same transportation even though they all ship the same kind of freight from the same points to the same pier.
49
Nothing in the record below or in the arguments presented to us justifies this plain discrimination. There is no finding, nor even any indication, that it costs the railroads one penny more to transport freight to the portions of the pier operated by the Government than to the immediately adjacent parts of the pier operated by their agent. And the mere fact that a discriminatory rate is embedded in a tariff does not make it legal.
50
It is claimed that the railroads can establish a general rule that they will not pay for wharfage and handling costs at private piers. This is undoubtedly true, but it does not follow that they can include within the line-haul rate charges for handling services at such piers that the railroads do not perform. Under any realistic appraisal, the railroads' costs for handling and wharfage services in the present situation are included as a part of their line-haul rate and are in no sense a 'free service.' The Government is compelled to pay this rate to get its goods transported. But, as the Interstate Commerce Commission expressly found, wartime conditions make it wholly impractical for the Government in shipping certain military goods to use the wharfage and handling services provided by the railroads under this rate. The Government is entitled to recover that portion of the 'line-haul' rate which it is charged for services that it cannot use. That is all it claims. There is no reason why the railroads should be allowed to operate in a manner that exacts a transportation charge from all shippers for benefits that some can enjoy and others, although in exactly the same situation, cannot. As this Court said in Union Pacific R. Co. v. Updike Grain Co., 222 U.S. 215, 220, 32 S.Ct. 39, 42, 56 L.Ed. 171, 'A rule apparently fair on its face and reasonable in its terms may, in fact, be unfair and unreasonable if it operates so as to give one an advantage of which another, similarly situated, cannot avail himself.'
51
I would reverse the judgment below.
1
'Wharfage refers to the provision of space on the docks for storage of freight pending transfer between freight cars and cargo vessels; handling refers to the unloading of goods from freight cars and placing them on the docks within reach of ship's tackle * * *.' United States v. Interstate Commerce Commission, 91 U.S.App.D.C. 178, at page 182, 198 F.2d 958, at page 962. See Wharfage Charges at Atlantic & Gulf Ports, 157 I.C.C. 663, 672.
2
'It is made the duty of all common carriers subject to the provisions of this chapter to establish, observe, and enforce just and reasonable classifications of property for transportation, with reference to which rates, tariffs, regulations, or practices are or may be made or prescribed, and just and reasonable regulations and practices affecting classifications, rates, or tariffs * * * which may be necessary or proper to secure the safe and prompt receipt, handling, transportation, and delivery of property subject to the provisions of this chapter upon just and reasonable terms, and every unjust and unreasonable classification, regulation, and practice is prohibited and declared to be unlawful.' 49 U.S.C. § 1(6), 49 U.S.C.A. § 1(6).
'If any common carrier subject to the provisions of this chapter shall, directly or indirectly, by any special rate, rebate, drawback, or other device, charge, demand, collect, or receive from any person or persons a greater or less compensation for any service rendered or to be rendered, in the transportation of passengers or property, subject to the provisions of this chapter, than it charges, demands, collects, or receives from any other person or persons for doing for him or them a like and contemporaneous service in the transportation of a like kind of traffic under substantially similar circumstances and conditions, such common carrier shall be deemed guilty of unjust discrimination, which is prohibited and declared to be unlawful.' 49 U.S.C. § 2, 49 U.S.C.A. § 2.
'It shall be unlawful for any common carrier subject to the provisions of this chapter to make, give, or cause any undue or unreasonable preference or advantage to any particular person, company, firm, corporation, association, locality, port, port district, gateway, transit point, region, district, territory, or any particular description of traffic, in any respect whatsoever; or to subject * * * any particular description of traffic to any undue or unreasonable prejudice or disadvantage in any respect whatsoever * * *.' 49 U.S.C. § 3(1), 49 U.S.C.A. § 3(1).
As §§ 1(6), 2 and 3(1) of the Act only are material on this appeal, they alone are quoted in pertinent part.
3
No reparations were requested in this proceeding. However, as the Government indicates, if the railroads' refusal to pay for wharfage and handling is held to be a violation of the Act, the Government may deduct the prior 'overpayments' from future sums due the railroads. See 49 U.S.C. § 66, 49 U.S.C.A. § 66.
4
See 289 I.C.C., at 61.
5
They can assume such and similar accessorial services by tariffs approved by the Commission as fair. See Baltimore & Ohio R. Co. v. United States, 305 U.S. 507, 524, 59 S.Ct. 284, 290, 83 L.Ed. 318. It is discrimination or unfairness in the tariffs that calls for correction. United States v. United States Smelting, Refining & Min. Co., 339 U.S. 186, 194—197, 70 S.Ct. 537, 542, 543, 94 L.Ed. 750. Such determinations are on a case-by-case basis. See, e.g., United States v. Wabash R. Co., 321 U.S. 403, 64 S.Ct. 752, 88 L.Ed. 827.
6
It called for performance of 'all terminal and pier warehouse intransit storage services excluding physical plant facilities (piers, warehouses, etc.); all checking and clerking services in connection therewith; all policing (sweeping and cleaning) services; and such other terminal services (excluding vessel checking and stevedoring; watchmen and guard service; utilities and maintenance of premises service) as may be designated herein, and, in connection therewith,
* * * (the performance of) all the duties of a terminal operator in such areas of the Norfolk Army Base or at any pier in or about the Hampton Roads harbor area as may be designated by the Contracting Officer * * *.'
7
'Statement of Excerpts from Penna. R.R. Tariff ICC 3007, Setting Forth the Regulations and the Compensation Which the Penna. R.R. Will Pay to the Norfolk Terminals Division of Stevenson & Young, Inc., for Wharfage Facilities Furnished and Handling Services Performed at Norfolk, Va.
'Rule 47
'* * * wharfage and handling charges published in Norfolk and Portsmouth Belt Line Railroad Company Tariff No. 6—J. I.C.C. 105, will be included in the freight rate to or from Norfolk, Va., on Export, Import, Intercoastal and Coastwise freight traffic, any quantity, * * * subject to the following conditions:
'(b) When receipt from or delivery to vessel is in rail service over wharf properties owned or leased by Norfolk Terminals Division of Stevenson & Young, Inc., and operated by Norfolk Terminals Division of Stevenson & Young, Inc., as a public terminal facility of the rail carriers.
(On January 1, 1952, the above rule (b) was changed. As the change strengthened the tariff in favor of the railroads, it is not quoted. See 289 I.C.C., at 59.)
'Compensation
'The Pennsylvania Railroad Company will pay to Norfolk Terminals Division of Stevenson & Young, Inc., as its agent, for wharfage facilities furnished and hanling services performed on traffic
described and conforming to the conditions specified above, compensating in the following amounts in cents per 100 pounds, except as otherwise provided.
Wharfage 1 1/4
Handling 3 3/4 or 75 cents per ton
'(Generally)
(There were exceptions.)
'(1) (a) Handling Charges will not be absorbed on freight in open cars, except on lumber, * * *.
'(b) When stowing in open cars is required, handling charge of 1/2 cent per 100 pounds or 10 cents per 2000 pounds will be absorbed on lumber, all kinds * * *.
'(2) (a) Wharfage and/or handling charges will not be absorbed on freight accorded literage, or on Grain or any other inbound or outbound traffic milled, mixed, malted or stored in transit at the wharf properties operated by Norfolk Terminals Division of Stevenson & Young, Inc., (or numerous other warehouses and terminals).
'(b) In all other respects on Export, Import, Intercoastal and Coastwise traffic, the wharfage, handling, storage and/or other charges applicable at the wharf properties operated by Norfolk Terminals Division of Stevenson & Young, Inc., (or numerous other warehouses and terminals) will be in addition to the rate to and from Norfolk, Va. or Portsmouth, Va., as the case may be, published in tariffs lawfully on file with the Interstate Commerce Commission.'
8
See United States v. Aberdeen & Rockfish R. Co., 289 I.C.C., at 61. It seems clear that such an attack could be made if present conditions justified a re-examination. The War Department attacked the practice in 1921 but its objection was overruled by the I.C.C. in 1929 after a thorough investigation in a 6—5 vote. Wharfage Charges at Atlantic and Gulf Ports, 157 I.C.C. 663, 678 686. Separation was sought largely to force the railroads to increase terminal charges so that competitive municipal and other non-railroad wharfingers might expand to develop better port facilities. The Commission reached the conclusion that such separation was inadvisable, and there was no evidence of injury from such practice.
'The carriers afford port facilities in competition with each other at the ports and a competitive condition exists which can not be eliminated by the mere segregation of uniform port charges. If the port charges were uniform at all ports the carriers still could meet competition by shrinking their line-haul rates. If the port charges were different at each port the carriers having the larger charge could shrink their line-haul rates sufficiently to offset the larger port charge, and the real substance of the present ship-side rates, where they exist, would be reestablished.' Id., at 684.
It was the sensitivity of the foreign importers and domestic ports to rates so stated that led to this conclusion. In the highly competitive railway network, export traffic is an important factor to the carriers and the ports. Costs of port handling vary widely, 157 I.C.C., at 673. Such variations are now absorbed in the practice of quoting shipside delivery in tariffs.
9
Such an exception is beyond the requirements of § 6(8) of the Act that provides for preference and precedence for United States shipments in emergencies.
10
This conclusion was amply supported by testimony of a Government witness, the Commanding Officer, Hampton Roads, Port of Embarkation:
'Only such personnel has the requisite training in the intricate nomenclature pertaining to the items and to the documentation required in connection with the proper loading and dispatching of vessels.
'A vast amount of pre-stowage planning of vessels in a port of embarkation must precede the labor of actual loading. Precise knowledge of overseas requirements must be available. Therefore, controls required to be exercised of all shipments must be absolute. These begin when freight is ordered shipped from points of origin and continue until the various commodities reach their final destination overseas.'
11
The Government's request for export rates on its war shipments was granted by the railroads so that commercial and government export freight had the same rates. Cf. War Materials Reparation Cases, 294 I.C.C. 5. This was a substantial concession by the railroads, contrary to their tariffs, and done only because of § 22 of the Interstate Commerce Act, 49 U.S.C., 49 U.S.C.A. § 22, allowing concessions to the United States. 289 I.C.C., at 63. The railroads have also spotted cars for the Army after delivery in the storage yards without extra charge. Other shippers would be charged for such service. 289 I.C.C., at 55. See United States v. American Sheet & Tin Plate Co., 301 U.S. 402, 57 S.Ct. 804, 81 L.Ed. 1186. Such relaxation of possible additional charges by the railroads does not decide the Army's claim for allowances for handling. The Commission did take the concessions into consideration, however, as to the fairness of the refusal to grant the claimed allowances. 289 I.C.C., at 64.
12
Although the Government seeks only an allowance of the published charge absorbed by the carriers of $1.00 per ton, the kind of service it requires in its area is illustrated by the fact that it pays $2.87 for handling. 289 I.C.C., at 61 et seq.
13
The Army's reliance on Atchison, T. & S.F.R. Co. v. United States, 232 U.S. 199, 34 S.Ct. 291, 58 L.Ed. 568, is misplaced. There this Court sustained the Commission in granting a shipper of fruit the right to precool the car and contents, although the carriers were in a position to refrigerate, though not in the better way. As the carriers were not in a position to perform the service properly, they could not by a tariff deny the consignor such right.
14
'Nothing in this chapter shall prevent the * * * handling of property free or at reduced rates for the United States * * *.' 49 U.S.C. § 22, 49 U.S.C.A. § 22.
15
'If it were not for the fact that the Government has reasons for handling its water-borne traffic differently from commercial shippers, there would be no reason why the Government should not use public piers like other shippers. There is no question but that a private shipper operating his own pier and handling his own traffic in a manner similar to the operation of the Norfolk Army Base today would not be entitled to the port rates.'
289 I.C.C., at 63: 'Evidence presented by the defendants supports their position that it is not unreasonable to refuse to extend wharfage and handling services to traffic handled over private piers when the shipper does not wish to use adequate facilities of the defendants. The defendants serving the Norfolk port area have had available port facilities more than ample to handle all the military traffic moving over the Army Base at Norfolk, at least on and since May 1, 1951.'
16
49 U.S.C. § 2, 49 U.S.C.A. § 2, n. 2, supra.
17
A typical tariff reads:
"Delivery of a line-haul carload shipment destined to smelter at Leadville, Colo., will include movement within smelter plant over track scales, to and from thaw-house, to and from a smelter sampler or to and from a combination sampler and concentrator to a designated unloading point indicated by the sampling company." 339 U.S. at page 196, 70 S.Ct. at page 543. See also United States Smelting & Refining Co., 266 I.C.C. 476, 478.
18
L. T. Barringer & Co. v. United States, 319 U.S. 1, 6—7, 729, 63 S.Ct. 967, 970, 87 L.Ed. 1171:
'Whether those circumstances and conditions are sufficiently dissimilar to justify a difference in rates, or whether, on the other hand, the difference in rates constitutes an unjust discrimination because based primarily on considerations relating to the identity or competitive position of the particular shipper rather than to circumstances attending the transportation service, is a question of fact for the Commission's determination. Hence its conclusion that in view of all the relevant facts and circumstances a rate or practice either is or is not unjustly discriminatory within the meaning of § 2 of the Act will not be disturbed here unless we can say that its finding is unsupported by evidence or without rational basis, or rests on an erroneous construction of the statute.'
For the same reasons, in Baltimore & Ohio R. Co. v. United States, 305 U.S. 507, 526, 59 S.Ct. 284, 291, 83 L.Ed. 318, dealing with storage of goods in transit, and United States v. American Sheet & Tin Plate Co., 301 U.S. 402, 407—408, 57 S.Ct. 804, 807, 81 L.Ed. 1186, dealing with post-line-haul switching practices, this Court has upheld the Commission's determination of unfairness vis-a -vis other shippers and its prohibitory orders. See Seaboard Air Line R. Co. v. United States, 254 U.S. 57, 41 S.Ct. 24, 65 L.Ed. 129; Merchants' Warehouse Co. v. United States, 283 U.S. 501, 51 S.Ct. 505, 75 L.Ed. 1227; United States v. Wabash R. Co., 321 U.S. 403, 410, 64 S.Ct. 752, 755, 88 L.Ed. 827.
| 78
|
352 U.S. 187
77 S.Ct. 257
1 L.Ed.2d 231
LESLIE MILLER, Inc., Appellant,v.STATE OF ARKANSAS.
No. 51.
Argued Dec. 5, 6, 1956.
Decided Dec. 17, 1956.
Mr. Leffel Gentry, Little Rock, Ark., for the appellant.
Mr. William J. Smith, Little Rock, Ark., for appellee.
Mr. John F. Davis, Washington, D.C., for the United States, as amicus curiae.
PER CURIAM.
1
Appellant submitted a bid in May 1954 for construction of facilities at an Air Force Base in Arkansas over which the United States had not acquired jurisdiction pursuant to 54 Stat. 19, 40 U.S.C. § 255, 40 U.S.C.A. § 255. The United States accepted appellant's bid, and in June appellant began work on the project. In September, the State of Arkansas filed an information accusing appellant of violation of Ark.Stat., 1947, §§ 71—701 through 71—721, for submitting a bid, executing a contract, and commencing work as a contractor in the State of Arkansas without having obtained a license under Arkansas law for such activity from its Contractors Licensing Board. The case was tried on stipulated facts. Appellant was found guilty and fined. The trial court's judgment was affirmed by the Arkansas Supreme Court, 225 Ark. 285, 281 S.W.2d 946, and the case came here on appeal. 351 U.S. 948, 76 S.Ct. 845. Appellant and the United States as amicus curiae contend that the application of the Arkansas statute to this contractor interferes with the Federal Government's power to select contractors and schedule construction and is in conflict with the federal law regulating procurement.
2
Congress provided in § 3 of the Armed Services Procurement Act of 1947, 62 Stat. 21, 23, 41 U.S.C. § 152, 41 U.S.C.A. § 152, that awards on advertised bids 'shall be made * * * to that responsible bidder whose bid, conforming to the invitation for bids, will be most advantageous to the Government, price and other factors considered * * *.' The report from the Committee on Armed Services of the House of Representatives indicated some of the factors to be considered: 'The question whether a particular bidder is a 'responsible bidder' requires sound business judgment, and involves an evaluation of the bidder's experience, facilities, technical organization, reputation, financial resources, and other factors.' H.R.Rep.No.109, 80th Cong., 1st Sess. 18; see S.Rep.No.571, 80th Cong., 1st Sess. 16. The Armed Services Procurement Regulations, promulgated under the Act, set forth a list of guiding considerations, defining a responsible contractor as one who
3
'(a) Is a manufacturer, construction contractor, or regular dealer. * * *
4
'(b) Has adequate financial resources, or ability to secure such resources;
5
'(c) Has the necessary experience, organization, and technical qualifications, and has or can acquire the necessary facilities (including probable subcontractor arrangements) to perform the proposed contract;
6
'(d) Is able to comply with the required delivery or performance schedule (taking into consideration all existing business commitments);
7
'(e) Has a satisfactory record of performance, integrity, judgment, and skills; and
8
'(f) Is otherwise qualified and eligible to receive an award under applicable laws and regulations.' 32 CFR § 1.307; see also 32 CFR § 2.406—3.
9
Under the Arkansas licensing law similar factors are set forth to guide the Contractors Licensing Board:
10
'The Board, in determining the qualifications of any applicant for original license * * * shall, among other things, consider the following: (a) experience, (b) ability, (c) character, (d) the manner of performance of previous contracts, (e) financial condition, (f) equipment, (g) any other fact tending to show ability and willingness to conserve the public health and safety, and (h) default in complying with the provisions of this act * * * or any other law of the State. * * *' Ark.Stat., 1947, § 71—709.
11
Mere enumeration of the similar grounds for licensing under the state statute and for finding 'responsibility' under the federal statute and regulations is sufficient to indicate conflict between this license requirement which Arkansas places on a federal contractor and the action which Congress and the Department of Defense have taken to insure the reliability of persons and companies contracting with the Federal Government. Subjecting a federal contractor to the Arkansas contractor license requirements would give the State's licensing board a virtual power of review over the federal determination of 'responsibility' and would thus frustrate the expressed federal policy of selecting the lowest responsible bidder. In view of the federal statute and regulations, the rationale of Johnson v. State of Maryland, 254 U.S. 51, 57, 41 S.Ct. 16, 65 L.Ed. 126, is applicable:
12
'It seems to us that the immunity of the instruments of the United States from state control in the performance of their duties extends to a requirement that they desist from performance until they satisfy a state officer upon examination that they are competent for a necessary part of them and pay a fee for permission to go on. Such a requirement does not merely touch the Government servants remotely by a general rule of conduct; it lays hold of them in their specific attempt to obey orders and requires qualifications in addition to those that the Government has pronounced sufficient. It is the duty of the Department to employ persons competent for their work and that duty it must be presumed has been performed. * * *'
13
The judgment of the Supreme Court of Arkansas is reversed and the cause is remanded for further proceedings not inconsistent with this opinion.
14
Reversed and remanded.
| 910
|
352 U.S. 180
77 S.Ct. 252
1 L.Ed.2d 225
Herbert BROWNELL, Jr., Attorney General of the United States, Petitioner,v.Tom WE SHUNG.
No. 43.
Argued Nov. 13, 1956.
Decided Dec. 17, 1956.
Mr. Oscar H. Davis, Washington, D.C., for petitioner.
Mr. Andrew Reiner, New York City, for respondent.
Mr. Justice CLARK delivered the opinion of the Court.
1
In Shaughnessy v. Pedreiro, 1955, 349 U.S. 48, 75 S.Ct. 591, 99 L.Ed. 868, we held that an alien, ordered deported by the Attorney General under the provisions of the Immigration and Nationality Act of 1952, 8 U.S.C.A. § 1101 et seq. might test the legality of such order in a declaratory judgment action brought under § 10 of the Administrative Proceedure Act, 60 Stat. 243, 5 U.S.C. § 1009, 5 U.S.C.A. § 1009. The sole question to be determined here is whether the legality of an exclusion order entered under the relevant provisions of the same 1952 Act must be challenged by habeas corpus, or whether it may also be reviewed by an action for declaratory judgment under § 10 of the Administrative Procedure Act. The Court of Appeals held the latter to be an appropriate remedy. 97 U.S.App.D.C. 25, 227 F.2d 40. We granted certiorari, 351 U.S. 905, 76 S.Ct. 697, because of the importance of the question in the administration of the immigration law. We conclude that either remedy is available in seeking review of such orders. This makes it unnecessary for us to pass upon other questions raised by the parties.
2
Shung, a Chinese alien, presented himself at San Francisco on November 28, 1947, claiming admission to the United States under the provisions of the War Brides Act of December 28, 1945, 59 Stat. 659, 8 U.S.C. (1946 ed.) § 232. He testified under oath that he was the blood son of an American citizen who served in the United States armed forces during World War II. In January 1948 and again in February 1949, Boards of Special Inquiry held Shung inadmissible on the ground that he had not established the alleged relationship. The Board of Immigration Appeals Affirmed. Shung first sought judicial review of this order by a declaratory judgment action instituted before the effective date of the Immigration and Nationality Act of 1952. His complaint was dismissed on the ground that the order was valid. Tom We Shung v. McGrath, D.C., 103 F.Supp. 507, affirmed sub nom. Tom We Shung v. Brownell, 93 U.S.App.D.C. 32, 207 F.2d 132. We vacated the judgment and remanded the cause to the District Court with directions to dismiss it for lack of jurisdiction, 346 U.S. 906, 74 S.Ct. 237, 98 L.Ed. 405, on the authority of Heikkila v. Barber, 1953, 345 U.S. 229, 73 S.Ct. 603, 97 L.Ed. 972, which held that habeas corpus was the only available remedy for testing deportation orders under the Immigration Act of 1917. After the passage of the 1952 Act, Shung filed this suit seeking review of his exclusion by a declaratory judgment action. He asserts that our ruling in Pedreiro permitting deportation orders under the 1952 Act to be challenged by declaratory action requires a similar result as to exclusion orders. However, the Government contends that the Pedreiro rule does not apply in exclusion cases because of the basic differences between those actions and deportation cases. The Government also urges that the language, statutory structure, and legislative history of the 1952 Act support its contention.
I.
3
At the outset the Government contends that constitutionally an alien seeking initial admission into the United States is in a different position from that of a resident alien against whom deportation proceedings are instituted.1 This, it contends, precludes general judicial review. Shung admits these substantive differences but counters that such a distinction should be without significance when all that is involved is the form of judicial action available, not the scope of review. We do not believe that the constitutional status of the parties requires that the form of judicial action be strait-jacketed. Nor should the fact that in one action the burden is on the alien while in the other it must be met by the Government afford basis for discrimination. Admittedly, excluded aliens may test the order of their exclusion by habeas corpus. Citizenship claimants who hold 'certificates of identity' are required by § 360(c) of the 1952 Act2 to test the validity of their exclusion by habeas corpus only. Respondent here neither claims citizenship nor did he hold a certificate of identity, and § 360(c) has no bearing on this case. For a habeas corpus proceeding the alien must be detained or at the least be in technical custody, as the Government puts it. On the other hand, a declaratory judgment action requires no such basis and the odium of arrest and detention is not present. It does not follow that the absence of this condition would enlarge the permissible scope of review traditionally permitted in exclusion cases. The substantive law governing such actions would remain the rule of decision on the merits but the form of action would be by declaratory judgment rather than habeas corpus.3 We conclude that unless the 1952 Act is to the contrary, exclusion orders may be challenged either by habeas corpus or by declaratory judgment action.
II.
4
The Government insists that Congress has limited such challenges to habeas corpus actions by certain language in the 1952 Act. It argues that the finality clause of the Act with respect to exclusion4 limits judicial review to habeas corpus only. The gist of that clause as to deportation cases is that 'the decision of the Attorney General shall be final,'5 while in exclusion proceedings 'the decision of a special inquiry officer (is) final unless reversed on appeal to the Attorney General.' The Government reasons that the latter clause limits review to administrative appeal to the Attorney General and that no other form of review was intended, aside from habeas corpus, to test the alien's exclusion. It points to exceptions that even withhold administrative review in certain classes of cases as bolstering its position. It is true that subsections (b) and (d) of § 236 of the 1952 Act deny any administrative appeal on temporary exclusion in security cases as well as in those where the alien suffers a medical affliction of certain types. But to darken the meaning of the word 'final' as used by Congress by giving it chameleonic characteristics is to indulge in choplogic. In fact, the regulations of the Attorney General seem to give 'final' the same connotation with respect to deportation as does the Act with respect to exclusion. See 8 CFR, Rev. 1952, § 242.61(e). Furthermore, more, as we pointed out in Pedreiro, such a 'cutting off' of judicial review 'would run counter to § 10 and $12 of the Administrative Procedure Act.' (349 U.S. at 51, 75 S.Ct. 594.) 'Exemptions from the * * * Administrative Procedure Act are not lightly to be presumed,' Marcello v. Bonds, 1955, 349 U.S. 302, 310, 75 S.Ct. 757, 762, 99 L.Ed. 1107, and unless made by clear language or supersedure the expanded mode of review granted by that Act cannot be modified. We therefore conclude that the finality provision of the 1952 Act in regard to exclusion refers only to administrative finality.
III.
5
The Government also points to certain testimony at hearings on the bill, as well as statements made on the floor in debate at the time of passage of the 1952 Act, as supported its position. We believe, however, that Senate Report No. 1137, 82d Cong., 2d Sess.,6 and the statement of the managers on the part of the House which accompanied the Conference Report,7 reflect the intention of the Congress in this regard. The Senate Report, after reciting that a provision limiting 'judicial review only through the writ of habeas corpus' had been stricken from the bill, stated that such action was not intended to 'expand (the scope of) judicial review in immigration cases beyond that under existing law.' (Emphasis supplied.) The House managers reported that after careful consideration of 'the problem of judicial review' they were satisfied that the 'procedures provided in the bill * * * remain within the framework and the pattern of the Administrative Procedure Act. The safeguard of judicial procedure is afforded the alien in both exclusion and deportation proceedings.' We believe that our interpretation of the Act is in full accord with these significant reports made by those sponsoring and managing the legislation on the floor of each house of the Congress.
6
It may be that habeas corpus is a far more expeditious remedy than that of declaratory judgment, as the experience of Shung may indicate.8 But that fact may be weighed by the alien against the necessity of arrest and detention after which he may make his choice of the form of action he wishes to use in challenging his exclusion. In either case, the scope of the review is that of existing law.
7
Affirmed.
1
Since Nishimura Ekiu v. United States, 1892, 142 U.S. 651, 12 S.Ct. 336, 35 L.Ed. 1146, this Court has held that in exclusion cases involving initial entry 'the decisions of executive or administrative officers, acting within powers expressly conferred by congress, are due process of law.' At page 660, of 142 U.S., at page 339 of 12 S.Ct. Nevertheless, due process has been held in cases similar in facts to the one here involved to include a fair hearing as well as conformity to statutory grounds. On the other hand, 'It is well established that if an alien is a lawful permanent resident of the United States and remains physically present there, he is a person within the protection of the Fifth Amendment.' Kwong Hai Chew v. Colding, 1953, 344 U.S. 590, 596, 73 S.Ct. 472, 477, 97 L.Ed. 576.
2
Section 360(c), 66 Stat. 273, 8 U.S.C. § 1503, 8 U.S.C.A. § 1503, provides in part:
'A person who has been issued a certificate of identity under the provisions of subsection (b) and while in possession thereof, may apply for admission to the United States at any port of entry, and shall be subject to all the provisions of this Act relating to the conduct of proceedings involving aliens seeking admission to the United States. A final determination by the Attorney General that any such person is not entitled to admission to the United States shall be subject to review by any court of competent jurisdiction in habeas corpus proceedings and not otherwise.'
3
We do not suggest, of course, that an alien who has never presented himself at the borders of this country may avail himself of the declaratory judgment action by bringing the action from abroad.
4
Section 236(c), 66 Stat. 200, 8 U.S.C. § 1226(c), 8 U.S.C.A. § 1226(c):
'(c) Except as provided in subsections (b) or (d), in every case where an alien is excluded from admission into the United States, under this Act or any other law or treaty now existing or hereafter made, the decision of a special inquiry officer shall be final unless reversed on appeal to the Attorney General.'
5
Section 242(b), 66 Stat. 210, 8 U.S.C. § 1252(b) 8 U.S.C.A. § 1252(b), provides in part:
'In any case in which an alien is ordered deported from the United States under the provisions of this Act, or of any other law or treaty, the decision of the Attorney General shall be final * * *.'
6
'Exclusion procedure In both S. 3455 and S. 716, the predecessor bills, it was provided that administrative determinations of fact and the exercise of administrative discretion should not be subject to judicial review and that the determinations of law should be subject to judicial review only through the writ of habeas corpus. This language is omitted from the instant bill. The omission of the language is not intended to grant any review of determinations made by consular officers, nor to expand judicial review in immigration cases beyond that under existing law.' At p. 28.
7
'(2) Having extensively considered the problem of judicial review, the conferees are satisfied that procedures provided in the bill, adapted to the necessities of national security and the protection of economic and social welfare of the citizens of this country, remain within the framework and the pattern of the Administrative Procedure Act. The safeguard of judicial procedure is afforded the alien in both exclusion and deportation proceedings.' (Emphasis supplied.) H.R.Rep. No. 2096, 82d Cong., 2d Sess., at 127.
8
The original complaint in the former action was filed January 19, 1950.
| 12
|
352 U.S. 202
77 S.Ct. 275
1 L.Ed.2d 254
UNITED STATES of America, Petitioner,v.Paul E. PLESHA et al.
No. 39.
Argued Nov. 8, 1956.
Decided Jan. 14, 1957.
Mr. Lester S. Jayson, Washington, D.C., for petitioner.
Mr. Lawrence A. Schei, Sacramento, Cal., for respondent.
Mr. Justice BLACK delivered the opinion of the Court.
1
Article IV of the Soldiers' and Sailors' Civil Relief Act of 1940 provided a plan under which men inducted into the armed forces would continue to receive the protection of previously purchased commercial life insurance while in the service without paying premiums.1 Insurance companies were required to keep the policies of servicemen who elected to come under the Act in effect until one year after their military service ended even though these men made no further payments. The Government assured the insurance companies that the premiums would eventually be paid by giving its promissory certificates to the companies. The respondents, Plesha, Mabbutt, and Kern, who entered the Army in 1941, had previously purchased commercial life insurance. They invoked the benefits of the Act by filing proper applications with their companies and the Veterans' Administration. They made no further payment of premiums but the policies were kept in effect by government certificates. After leaving the Army, they were notified by the Veterans' Administration that unless they paid back premiums with interest their policies would lapse. Respondents allowed the policies to lapse and the Government paid the insuring companies the back premiums after first deducting the cash surrender value of the policies. In this case, the Government contends that it has a legal right to be reimbursed for these payments.2 The District Court agreed with this contention, 123 F.Supp. 593. The Court of Appeals reversed, holding Servicemen had no statutory or contractual obligation to the Government to repay the premiums. 227 F.2d 624.3 We affirm the judgment below because the language of the 1940 Act, its legislative history and its administrative interpretation demonstrate that Congress intended that ex-soldiers would not have to reimburse the Government.
2
1. The Act.—As the Government concedes, the 1940 Act contained no express provision which required reimbursement for premiums paid by the Government on a lapsed policy.4 But significantly it did contain specific provisions to reduce any losses the Government might incur in administering the insurance plan by giving the Government certain other rights. Under § 408 the United States had a lien upon the policy from the time it came under the protection of the Act. When a soldier died the insurance company was authorized by § 409 to deduct unpaid premiums from the proceeds payable under the policy. If after leaving the service the insured desired to maintain his policy, § 410 required him to pay the unpaid premiums to the insurance company. If he chose not to pay these premiums, § 410 further provided that the policy would lapse. And if a policy lapsed, § 411 provided that the United States should be given credit for the policy's cash surrender value as an offset against the Government's promise to pay the back premiums. There was nothing that indicated that an ex-soldier had to reimburse the Government for any balance that it paid.
3
2. The legislative history.—The Government's claim for reimbursement is refuted by the legislative history. Article IV of the 1940 Act substantially reenacted the insurance provisions of the Soldiers' and Sailors' Civil Relief Act of 19185 and had little independent legislative history. We agree with the Administrator of Veterans' Affairs that this scant history 'is of little, if any, help' in interpreting the 1940 Act.6 We must therefore examine the history of the 1918 bill.7 During the Senate Committee hearings on this bill, Senator Reed, who was the principal critic of its insurance provisions, interpreted them as permitting a soldier to let his policy lapse without any obligation to restore the premiums paid by theGovernment.8 He objected to the Government's bearing any part of the cost and even suggested that the bill should be amended to authorize the Government to deduct the premiums from the soldier's monthly pay. Professor John H. Wigmore, who as a major representing the Army had a dominant part in drafting the bill and presenting it to Congress, strongly objected to Senator Reed's suggestions. Professor Wigmore pointed out that this benefit would be in keeping with the many new benefits which were being conferred on servicemen at that critical war period. When directly asked whether a soldier could be made to pay, he called attention to the fact that the Government had a lien on the policy and could recover the cash surrender value. He admitted, however, that the cash surrender value would not in all cases pay the entire amount of back premiums but predicted that the loss to the Government would be very slight.9 The Committee accepted Professor Wigmore's position and reported the bill in the form he urged.
4
The House Judiciary Committee made a comprehensive report on the 1918 bill.10 It referred to the insurance sections as providing a method for the Government to 'carry' the premiums upon servicemen's policies in private companies. The Committee recognized that carrying this insurance would cost the Government money, but expressed the hope that this burden would not be large because:
5
'In the first place the Government only guarantees the payment of the premiums. If the soldier dies the insurance company will get its premiums out of the policy and the Government's guaranty will not be called upon. If the soldier comes back from the war he will repay the premiums if he continues the policy, and if he lets the policy lapse the Government will be subrogated to his rights.'11
6
Thus, the Committee apparently thought that the Government must look to the cash surrender value to mitigate its loss where a policy was allowed to lapse.
7
In 1942, the 1940 Act was amended to require ex-servicemen to reimburse the Government for back premiums paid by it on their lapsed policies.12 The Government contends that this 1942 Amendment was to clarify and reaffirm the meaning of the 1940 Act. However it appears that the Veterans' Administration requested the 1942 Amendment to '* * * eliminate the possibility of requiring the Government to pay premiums on insurance which the insured does not intend to carry except during his period of active service. * * *'13 And during a hearing before the House Committee on Military Affairs a Veterans' Administration representative testified, '(t)he insured is liable for all of the premiums of the $5,000 policy, the Government acting really as a guarantor. However, if there is a default (by the ex-serviceman), there would not be any liability for the whole amount, in excess of the cash (surrender) value under present construction of existing law.'14 If the legislative history of the 1942 Act indicates anything, it is that Congress thought that it was changing the law by changing the language of the Act.15
8
3. The administrative interpretation.—The administration of the 1918 and 1940 Acts does not support the Government's claim for reimbursement. The Government relies on the fact that a few soldiers who invoked the protection of the 1918 Act and allowed their policies to lapse were later required to reimburse it. However these collections were so sporadic and so insignificant that instead of supporting the Government's position they contradict it.16 Under the 1940 Act, § 401(2) required the Veterans' Administration to issue notices explaining the Act. None of the notices promulgated prior to 1943 suggested any duty on the part of servicemen to reimburse the Government.17 But public statements of Veterans' Administration officials gave the Act a squarely contrary construction.18
9
Section 401(1) required soldiers seeking the benefit of the 1940 Act to file applications on forms prepared in accordance with the regulations of the Veterans' Administration. The respondents here filed such an application which included within its terms the following agreement:
10
'In consideration hereof, I hereby consent and agree that the United States shall be protected in the amount of any premiums and interest guaranteed on the above numbered policy in the event of its maturity as a claim, or out of the cash surrender value of the policy, at the expiration of the period of protection under the Act.'
11
This contract, prepared by the Veterans' Administration, contained no suggestion to soldiers that they would be expected to reimburse the Government for its payment of premiums if they permitted their policies to lapse. Had the Veterans' Administration construed the Act as imposing such a liability on soldiers, we think it would have mentioned the obligation in the contract that it asked them to sign.
12
Congress passed the 1918 and 1940 Acts at a time when men were being called from civilian life into the Army in the face of impending war. Great efforts were made to ease the burden on these men and their dependents. Among these, the Government generously provided family allotments, disability payments, and low-cost government insurance. Similarly the provisions under consideration here were adopted to assist soldiers who had bought insurance before entering the Army and did not require them to reimburse the Government.
13
Affirmed.
14
Mr. Justice FRANKFURTER, Mr. Justice BURTON and Mr. Justice HARLAN dissent for the reasons given by Circuit Judge HUXMAN in United States v. Hendler, 10 Cir., 225 F.2d 106.
1
54 Stat. 1183, 50 U.S.C.App. (1940 ed.) § 540, 50 U.S.C.A.Appendix, § 540.
2
Plesha brought suit against the Government to recover a dividend declared on his National Service Life Insurance policy. The Government attempted to offset the amount it had paid on his commercial insurance. The other respondents intervened to litigate the same basic issue.
3
We granted certiorari, 350 U.S. 1013, 76 S.Ct. 658, because this holding was in conflict with United States v. Hendler, 1 Cir., 225 F.2d 106.
4
The Government contends that such an obligation should be implied from the Act and from general principles of the common law particularly the doctrine that a guarantor who pays the debt of another is entitled to reimbursement. In regard to the common-law right of a guarantor, we are not persuaded from the record that the insured servicemen were indebted to the insurance companies for the wartime premiums either under the Act or the terms of their policies. Where no debt exists there is no basis for applying the common-law rules of guaranty. In any event, we would be very hesitant to infer a right to reimbursement from these servicemen in favor of the Government based on a common-law doctrine which was not referred to in the Act or in its congressional history. Cf. United States v. Gilman, 347 U.S. 507, 74 S.Ct. 695, 98 L.Ed. 898.
5
40 Stat. 444. 'The only change in this article (insurance) relates to method of administration.' H.R.Rep. No. 3001, 76th Cong., 3d Sess. 4.
6
Decisions of the Administrator of Veterans' Affairs, No. 742 (April 1947), Vol. 1, Supp. 1, pp. 93, 98. The Government relies here on a discussion between Congressmen Voorhis and Arends during the House debates on the 1940 Act. 86 Cong.Rec., Part 12, 13132—13133. Apparently these gentlemen were not familiar with the specific provisions of the Act. This is not surprising since neither was a sponsor of the measure. Moreover, since the 1940 Act was a substantial reenactment of the 1918 Act, there were no committee hearings to inform congressmen of the precise scope and effect of the Act. As neither Mr. Voorhis nor Mr. Arends were lawyers, it cannot be assumed that they were aware of the technical common-law theory of guaranty which the Government relies on here. We think the Veterans' Administrator was correct in concluding that the legislative history, which includes the Voorhis-Arends colloquy, 'is of little, if any, help' to the Government's claim.
7
See Boone v. Lightner, 319 U.S. 561, 565, 63 S.Ct. 1223, 1226, 87 L.Ed. 1587.
8
'If he comes back and wants to keep his insurance in effect, I take it the proposition here is that he must then pay the Government; but if he does not want to keep this policy in effect he still has the option to walk away and leave it.' Hearings before the Subcommittee of the Senate Committee on the Judiciary on S. 2859 and H.R. 6361, 65th Cong., 1st and 2d Sess. 135.
9
In closing the argument over requiring the soldiers to pay, the following colloquy took place between Major Wigmore and Senator Reed:
'Senator Reed: * * * Now, do you think that would be undesirable, Major, or do you think it would be greatly to be preferred that the Government just carry the risk?
'Maj. Wigmore: I can only speak for myself in that respect; but, speaking from my own judgment, it would seem to me that that is going further than this Nation ought to wish to go against its soldiers and sailors. * * *
'Senator Reed: * * * You really think it is desirable that the Government should carry it, regardless of the attempt to reimburse itself out of the man's pay?
'Maj. Wigmore: I only want to point out the fact that the Government, in the war-risk insurance bill * * * has offered to give Government insurance to soldiers and sailors at a rate of, I think, $8 a thousand, which I am told means that the Government pays the entire expenses of administration of that insurance * * * They have therefore contributed that already to soldiers and sailors in providing insurance. If the Government has gone that far, it seems to me it would be inconsistent with that, in principle, not to go this far.' Id., at 137—138.
10
H.R.Rep. No. 181, 65th Cong., 1st Sess.
11
Id., at 8.
12
'The amount paid by the United States to an insurer on account of applications approved under the provisions of this article, as amended, shall become a debt due to the United States by the insured on whose account payment was made * * *.' (Emphasis added.) 56 Stat. 775, 50 U.S.C.A.Appendix, § 546.
13
Letter of the Veterans' Administrator to the President of the Senate, appended to S.Rep. No. 716, 77th Cong., 1st Sess. 6.
14
Hearings before the House Committee on Military Affairs on H.R. 7029, 77th Cong., 2d Sess. 38.
15
Even the Veterans' Administration stated in a formal decision in 1947 that:
'Fairness compels admission that the legislative history of the 1942 act reflects a probable belief, though an incorrect one, on the part of the Seventy-seventh Congress that the 1940 act (passed by the Seventy-sixth Congress) had been construed as not giving rise to a debt owing by the insured to the Government upon the latter's payment to the insurer of the amount by which the premiums with interest exceeded the cash surrender value.' Decisions of the Administrator of Veterans' Affairs, No. 742 (April 1947), Vol. 1, Supp. 1, pp. 93, 103.
16
According to the Government's figures, 7,745 policies were brought within the protection of the 1918 Act; 476 of these policies were allowed to lapse. The total amount of back premiums paid by the Government on these policies was less than $20,000 or approximately $42 per policy, showing that Major Wigmore's prophecy as to the smallness of the Government's losses was a correct one. The Government sought reimbursement on only 10 of these 476 lapsed policies and total collections were $484.42. Records submitted show that all collections were obtained from soldiers who were still in the Army at the time they were called on to pay. The demands for payment went through regular military channels.
17
Apparently the first time the Veterans' Administration ever officially interpreted the Act as authorizing the Government to be reimbursed for its payment of premiums on lapsed policies was in Administrator's Decision No. 513, March 1, 1943. This decision held that the Government's agreement to carry policies under the 1940 Act was a 'gratuitous assumption of liability' which had been retroactively changed by the 1942 Amendment. Decisions of the Administrator of Veterans' Affairs, No. 513 (March 1943), Vol. 1, 781. However we agree with the view expressed in a later Administrator's Decision, No. 742, that a serviceman's liability under the 1940 Act must be determined under it and not under the 1942 Act. And see Lynch v. United States, 292 U.S. 571, 54 S.Ct. 840, 78 L.Ed. 1434.
18
Less than two months after the 1940 Act was passed, the Director of Insurance for the Veterans' Administration replying to a telegraphic inquiry stated that 'No provision is made in the Act for collecting from insured the amount paid by Government to insurer.' Shortly afterwards the Director made a similar statement to an insurance company representative.
In the meantime the Assistant Director made the following statement for publication in an insurance journal: 'There is no provision in the Act at this time for collecting from the insured the amount that the premium with interest may exceed the cash surrender value at the time of termination.' This same interpretation was given by the Assistant Director when testifying before the House Committee on Military Affairs in favor of the 1942 Amendment. See text at note 14, supra.
| 12
|
352 U.S. 212
77 S.Ct. 303
1 L.Ed.2d 261
UNITED STATES of America, Appellant,v.Ludenia HOWARD, Trading as Stokes Fish Company.
No. 52.
Argued Dec. 6, 1956.
Decided Jan. 14, 1957.
Mr. Leonard B. Sand, New York City, for appellant.
Mr. Clarence L. Thacker, Kissimmee, Fla., for appellee.
Mr. Justice REED delivered the opinion of the Court.
1
A federal criminal information was filed by the United States against Ludenia Howard, trading as Stokes Fish Company, appellee, in the United States District Court for the Southern District of Florida, charging her with a violation of the Federal Black Bass Act of May 20, 1926, as amended, c. 346, 44 Stat. 576, 46 Stat. 845, 61 Stat. 517, 66 Stat. 736, 16 U.S.C. §§ 851—854, 16 U.S.C.A. §§ 851—854. The Act provides:
2
'It shall be unlawful for any person to deliver * * * for transportation * * * from any State * * * any black bass or other fish, if (1) such transportation is contrary to the law of the State * * * from which such * * * fish * * * is to be transported * * *.' 16 U.S.C. § 852, 16 U.S.C.A. § 852.
3
The information stated that appellee delivered fish for transportation across the Florida border contrary to the 'laws of the State of Florida.' The relevant fishing provisions consisted of the rules and regulations of the Florida Game and Fresh Water Fish Commission and a criminal penalty imposed by the legislature for violation of the rules. The District Court, however, held that the rules and regulations do not constitute the 'law of' Florida within the meaning of the Black Bass Act and on appellee's motion quashed the information. An appeal was brought here by the United States pursuant to 18 U.S.C. § 3731, 18 U.S.C.A. § 3731. We noted probable jurisdiction. 351 U.S. 980, 76 S.Ct. 1046.
4
Florida's Game Commission was created by a 1942 constitutional amendment (Art. IV, § 30, Constitution of Florida, F.S.A.) which provides that:
5
'after January 1, 1943, the management, restoration, conservation and regulation of the * * * fresh water fish of the State of Florida * * * shall be vested in (the) Commission * * *.' It was empowered by the same amendment
6
'to fix bag limits and to fix open and closed seasons, on a state-wide, regional or local basis, as it may find to be appropriate, and to regulate the manner and method of taking, transporting, storing and using * * * fresh water fish * * *.'
The amendment further provides:
7
'The Legislature may enact any laws in aid of * * * the provisions of this amendment * * *. All laws fixing penalties for the violation of the provisions of this amendment * * * shall be enacted by the Legislature from time to time.'
8
Pursuant to this amendment, the Florida Legislature authorized the Commission to exercise
9
'the powers, duties and authority granted by § 30, article IV, of the constitution of Florida, by the adoption of rules, regulations and orders * * *.' Fla.Stat.Ann., 1943, § 372.021.
10
Another statute makes it a misdemeanor to violate
11
'any rule, regulation or order of the game and fresh water fish commission * * *.' Fla.Stat.1955, § 372.83.
12
Rule 14.01 of the Commission's rules prohibits the transportation of certain fresh fish outside the State; it is this regulation that Ludenia Howard is accused of breaking.1 Because the information was quashed for failure to state a federal crime, we assume the alleged acts of appellee occurred and that she is subject to criminal prosecution in Florida pursuant to § 372.83 of the Florida Statutes, F.S.A., as set out above.
13
The sole question presented is whether Rule 14.01 of the Commission's regulations, as enforced by § 372.83 of the Florida Statutes, F.S.A., is a 'law' of the State of Florida as that term is used in the Federal Act.
14
This Court has repeatedly ruled, in other circumstances, that orders of state administrative agencies are the law of the State. In Grand Trunk Western R. Co. v. Railroad Commission of Indiana, 221 U.S. 400, 403, 31 S.Ct. 537, 55 L.Ed. 786, the Court stated, citing Prentis v. Atlantic Coast Line Co., 211 U.S. 210, 226, 29 S.Ct. 67, 69, 53 L.Ed. 150:
15
'the order (of the Indiana Railroad Commission) * * * is a law of the state within the meaning of the contract clause of the Constitution * * *.'
16
And, in Lake Erie & W.R. Co. v. State Public Utilities Comm., 249 U.S. 422, 424, 39 S.Ct. 345, 346, 63 L.Ed. 684, it was said that an order of the state public utilities commission 'being legislative in its nature * * * is a state law within the meaning of the Constitution of the United States and the laws of Congress regulating our jurisdiction.' A similar statement may be found in Arkadelphia Milling Co. v. St. Louis S.W.R. Co., 249 U.S. 134, 141, 39 S.Ct. 237, 240, 63 L.Ed. 517.
17
It was suggested that the action of the court below is supported by United States v. Eaton, 144 U.S. 677, 12 S.Ct. 764, 36 L.Ed. 591. We believe the case is inapposite. It involved the regulation of manufacturers and dealers in oleomargarine under 24 Stat. 209. Section 18 of the Act provided a criminal penalty for the knowing or willful failure 'to do, or cause to be done, any of the things required by law.' Section 5 required manufacturers to keep certain records. A similar requirement was imposed upon wholesalers by a regulation made by the Commissioner of Internal Revenue pursuant to § 20. The defendant in the Eaton case, a wholesaler, failed to keep the proper records, but this Court held he had not committed a crime under § 18:
18
'Regulations prescribed by the president and by the heads of departments, under authority granted by congress, may be regulations prescribed by law, so as lawfully to support acts done under them and in accordance with them, and may thus have, in a proper sense, the force of law; but it does not follow that a thing required by them is a thing so required by law as to make the neglect to do the thing a criminal offense in a citizen, where a statute does not distinctly make the neglect in question a criminal offense.' Id., 144 U.S. at page 688, 12 S.Ct. at page 767.
19
The Court made particular mention of the fact that the Act expressly required manufacturers to keep certain books, but made no such requirement of wholesalers. Id.2 In Singer v. United States, 323 U.S. 338, 345, 65 S.Ct. 282, 286, 89 L.Ed. 285, we said:
20
'United States v. Eaton turned on its special facts, as United States v. Grimaud, 220 U.S. 506, 518, 519, 31 S.Ct. 480, 483, 484, 55 L.Ed. 563, emphasizes. It has not been construed to state a fixed principle that a regulation can never be a 'law' for purposes of criminal prosecutions. It may of may not be, depending on the structure of the particular statute.'
21
See also Caha v. United States, 152 U.S. 211, 219, 14 S.Ct. 513, 515, 38 L.Ed. 415. Here, it is beyond question that the Florida Legislature, in Fla.Stat., § 372.83, F.S.A., intended to and did make infraction of any commission regulation a violation of state law, punishable as a misdemeanor.
22
Appellee argues that the rules of the Florida Commission are so subject to change that they lack sufficient substance and permanence to be the 'law' of Florida. We need not decide now whether a state agency could make a rule of such a temporary nature and so unaccompanied by the procedural niceties of rule making that the declaration should not be considered the law of the State for purposes of a statute such as the Black Bass Act. These considerations formed no part of the opinion below. Moreover appellee has not demonstrated that the rule here involved is of such a character.
23
Commission promulgation of orders is regulated by § 372.021 of 14 Fla.Stat.Ann., a legislative enactment. It provides that no regulation or amendment to a regulation is effective until 30 days after the filing of a certified copy of such provisions with the secretary of state. The statute also directs that any change in the type of regulation involved here is to be filed in the office of each county judge and that changes must be published in each county in a newspaper of general circulation.3 We are advised by the Government's brief that the Commission compiles its rules in a code book which is circulated without cost to all county judges, as is directed by statute, and also to principal sporting goods and license dealers. In fact they seem to be available to anyone requesting them from the Commission. We are also told that it is the Commission's practice to conduct public hearings to give everyone an opportunity to air his own views on proposed changes in the rules. None of these assertions is challenged by appellee.
24
We recognize that not all the above-described procedures are mandatory and that whether any of them was employed with the enactment of Rule 14.01 cannot be ascertained from the record at this time. However, the fact that it is the asserted practice of the Commission to comply with them suggests a potent answer to appellee's charge of impermanence. Moreover, it is not inappropriate for us to note that transportation of some species of fish covered by this information has been prohibited in Florida since 1927. Fla.Stat.Ann.1943, § 372.29; Acts Fla.1929, c. 13644, § 35.
25
The State of Florida prefers to entrust the regulation of its wild life conservation program to a Game Commission. Such a preference is in accordance with the practice of 28 States that have vested full regulatory authority in commissions. Only 6 States reserve that full authority to their legislatures. Sport Fishing Institute Bulletin, No. 26, p. 60 (January 1954). Moreover, a document prepared by the Department of the Interior and submitted to us by the Government at our request shows that even in 1926, the year the Black Bass Act was first passed, significant rule-making power was entrusted to game commissions or commissioners in some 20 States.4
26
That the congressional purpose was to extend the enforcement guarantees of the Black Bass Act to these regulations is the most reasonable interpretation of the Act and is an interpretation supported by the legislative history of the 1947 amendment to the Act. The amendment, which made the provisions of the Act applicable to all game fish, was accompanied by Senate and House reports containing the following language:
27
'The bill is intended to supplement State laws applying to protection of game fish. * * * State laws become ineffectual when fish taken in violation of the law cross the State line. If we are to protect game fish, an important natural resource, the Federal Government must collaborate in the enforcement of protective laws and regulations at the point where State jurisdiction ends.' S.Rep. No. 288, 80th Cong., 1st Sess. 2; H.R.Rep. No. 986, 80th Cong., 1st Sess.
28
Accordingly we hold that the phrase 'law of the State,' as used in this Act, is sufficiently broad to encompass the type of regulation used in Florida.
29
Reversed and remanded.
1
'No person * * * shall * * * transport, transport for sale, or transport out of the State of Florida any large or small mouth black bass, speckled perch, jack, shell cracker, warmouth perch, red breast, pike, stump knocker, sun fish, or Canadian sunfish, or any other species of bream; * * *.'
2
The Court also paid special note to the fact that subsequent to the alleged acts of Eaton, but prior to its decision, Congress amended the Oleomargine Act to expressly require the keeping of books by wholesalers. 144 U.S. at pages 685 686, 688, 12 S.Ct. at pages 766, 767. The Court noted this factor in Eaton when discussing the Eaton case in Caha v. United States, 152 U.S. 211, 220, 14 S.Ct. 513, 516, 38 L.Ed. 415.
3
Most fishermen must secure a fishing license (they may be obtained at the office of any county judge) and a statute provides that the 'license shall contain on the back thereof a synopsis of the * * * fresh water fishing laws of the state.' Fla.Stat.1955, § 372.69, F.S.A. Whether the rule here involved is printed on appellee's license, indeed, whether appellee even has a license, is not shown by the record at this stage of the proceedings.
4
See, e.g., Supplement to the Codes and General Laws of California 1925—1927, Act of May 23, 1925, § 3 (Act 2895), St.Cal.1925, p. 595, West's Ann.Fish & Game Code, § 7708; Laws of Maine, 1917, c. 219, § 2; New York Laws, 1912, c. 318; Conservation Law, McKinney's Consol.Laws, c. 65, § 150 et seq.
| 78
|
352 U.S. 232
77 S.Ct. 294
1 L.Ed.2d 278
Orlando DELLI PAOLI, Petitioner,v.UNITED STATES of America.
No. 33.
Argued Oct. 18, 1956.
Decided Jan. 14, 1957.
Mr. Daniel H. Greenberg, New York City, for petitioner.
Mr. J. F. Bishop, Washington, D.C., for respondent.
Mr. Justice BURTON delivered the opinion of the Court.
1
A joint trial in this case resulted in the conviction of five co-defendants on a federal charge of conspiring to deal unlawfully in alcohol. Only the petitioner, Orlando Delli Paoli, appealed. The principal issue is whether the trial court committed reversible error, as against petitioner, by admitting in evidence a confession of a co-defendant, made after the termination of the alleged conspiracy. The trial court declined to delete references to petitioner from the confession but stated clearly that the confession was to be considered only in determining the guilt of the confessor and not that of other defendants. For the reasons hereafter stated, we agree that, under the circumstances of this case, such a restricted admission of the confession did not constitute reversible error.
2
In the United States District Court for the Southern District of New York, the jury convicted petitioner and four co-defendants, margiasso, Pierro, Whitley and King, of conspiring to possess and transport alcohol in unstamped containers and to evade payment of federal taxes on the alcohol.1 The Government's witnesses testified that they had observed actions of the defendants which disclosed the procedure through which Margiasso, Pierro and petitioner supplied unstamped alcohol to their customers, such as King and Whitley. The Government also offered, for use against Whitley alone, his written confession made in the presence of a government agent and of his own counsel after the termination of the conspiracy.2 The court postponed the introduction of Whitley's confession until the close of the Government's case. At that time, the court admitted it with an emphatic warning that it was to be considered solely in determining the guilt of Whitley and not in determining the guilt of any other defendant. The court repeated this admonition in its charge to the jury.
3
The Court of Appeals affirmed petitioner's conviction, with one judge dissenting. 2 Cir., 229 F.2d 319. We granted certiorari especially to consider the admissibility of Whitley's post-conspiracy confession. 350 U.S. 992, 76 S.Ct. 544.
I.
4
Petitioner first attacks the sufficiency of the evidence connecting him with the conspiracy. The Government's evidence, exclusive of Whitley's confession, showed that the defendants' conspiracy to deal in unstamped alcohol centered around a garage used for storage purposes in a residential district of the Bronx in New York City and gasoline service station, also in the Bronx. The service station was used by Margiasso, Pierro and petitioner as a place to meet customers and transfer alcohol.
5
In December 1949, petitioner, using the alias of 'Bobbie London,' was associated with Margiasso and Pierro in inspecting the garage and in negotiating for its purchase. For $2,000 in cash, title to the garage and an adjacent cottage was taken in the name of Pierro's sister. In 1950, the garage was repaired, its windows boarded up and its doors strengthened and padlocked. Petitioner lived not far away, in the Bronx, and was observed, from time to time, at the garage or using a panel truck which was registered under a false name. During the daytime, this truck generally was parked near petitioner's home or the garage but neighbors testified that it was in use late at night. In it petitioner transported various articles to the garage or elsewhere. On one occasion, petitioner, with Margiasso, loaded it with bundles of cartons suited to the packing of 5-gallon cans. Late in 1951, petitioner used an additional truck, also registered under a false name. In addition, he frequently drove to the service station in a Cadillac car. On December 18, 1951, he used this car in making delivery of a large package to a near-by bar.
6
During December 1951, the service station often was used as a meeting place for Margiasso, Pierro and petitioner. Margiasso and petitioner were there on the evening of December 28.3 At about 7 and 10 p.m., respectively, King and Whitley arrived. Each turned over his car to Margiasso. Margiasso drove King's car to the garage and returned with it heavily loaded. King then drove it away. Government agents followed him until he stopped in Harlem. There they arrested him and took possession of 19 5-gallon cans of unstamped alcohol found in his car. Later in the evening, Margiasso took Whitley's car to the garage and was arrested in it when leaving the still open garage. The agents thereupon seized 113 5-gallon cans of unstamped alcohol they found in the garage. Whitley, who had been waiting for Margiasso at the service station with $1,000 in a paper bag, was arrested on the agents' return with Margiasso.
7
Petitioner's presence at the service station on the evening of December 28 was closely related to these events. He waited there with King for Margiasso to return with King's car containing the 19 cans of alcohol. He was there again with Margiasso at about 10 p.m. but left shortly before Whitley came. He returned while Margiasso, Whitley and the agents were there and was arrested while attempting to drive away.
8
Petitioner contends that the above evidence shows merely that he was a friend and associate of Pierro and Margiasso. We conclude, however, from the record as a whole, that the jury could find, beyond a reasonable doubt, that petitioner was associated with Pierro and Margiasso in the purchase of the garage and the use of the panel truck, that he knew that unstamped alcohol was stored in the garage, that he had access to it and that he was an active participant in the transfers of alcohol to Whitley and King. Accordingly, we agree with Circuit Judge Learned Hand's statement made for the court below, following his own summary of the evidence of petitioner's participation in the conspiracy:
9
'Not only was all this enough to connect him with the business, but the jurors could hardly have failed to find that he was in the enterprise. The whole business was illegal and carried on surreptitiously; and the possibility that unless he were a party to the venture, Pierro and Margiasso would have associated (with) him to the extent we have mentioned is too remote for serious discussion.' 229 F.2d at page 320.4
II.
10
In considering the admissibility of the Whitley confession, we start with the premise that the other evidence against petitioner was sufficient to sustain his conviction. If Whitley's confession had included no reference to petitioner's participation in the conspiracy, its admission would not have been open to petitioner's objection. Similarly, if the trial court had deleted from the confession all references to petitioner's connection with the conspiracy, the admission of the remainder would not have been objectionable. The impracticality of such deletion was, however, agreed to by both the trial court and the entire court below and cannot well be controverted.
11
This Court long has held that a declaration made by one conspirator, in furtherance of a conspiracy and prior to its termination, may be used against the other conspirators. However, when such a declaration is made by a conspirator after the termination of the conspiracy, it may be used only against the declarant and under appropriate instructions to the jury.
12
'* * * Declarations of one conspirator may be used against the other conspirator not present on the theory that the declarant is the agent of the other, and the admissions of one are admissible against both under a standard exception to the hearsay rule applicable to the statements of a party. Clune v. United States, 159 U.S. 590, 593, 16 S.Ct. 125, 126, 40 L.Ed. 269. See United States v. Gooding, 12 Wheat. 460, 468—470, 6 L.Ed. 693. But such declaration can be used against the co-conspirator only when made in furtherance of the conspiracy. Fiswick v. United States, 329 U.S. 211, 217, 67 S.Ct. 224, 227, 91 L.Ed. 196; Logan v. United States, 144 U.S. 263, 308—309, 12 S.Ct. 617, 631—632, 36 L.Ed. 429. There can be no furtherance of a conspiracy that has ended. Therefore, the declarations of a conspirator do not bind the co-conspirator if made after the conspiracy has ended. That is the teaching of Krulewitch v. United States, supra (336 U.S. 440, 69 S.Ct. 716, 93 L.Ed. 790), and Fiswick v. United States, supra. Those cases dealt only with declarations of one conspirator after the conspiracy had ended. * * * 'Relevant declarations or admissions of a conspirator made in the absence of the co-conspirator, and not in furtherance of the conspiracy, may be admissible in a trial for conspiracy as against the declarant to prove the declarant's participation therein. The court must be careful at the time of the admission and by its instructions to make it clear that the evidence is limited as against the declarant only. Therefore, when the trial court admits against all of the conspirators a relevant declaration of one of the conspirators after the conspiracy has ended, without limiting it to the declarant, it violates the rule laid down in Krulewitch. Such declaration is inadmissible as to all but the declarant.
13
'* * * These declarations (i.e., those admissible only as to the declarant) must be carefully and clearly limited by the court at the time of their admission and the jury instructed as to such declarations and the limitations put upon them. Even then, in most instances of a conspiracy trial of several persons together, the application of the rule places a heavy burden upon the jurors to keep in mind the admission of certain declarations and to whom they have been restricted and in some instances for what specific purpose. While these difficulties have been pointed out in several cases, e.g., Krulewitch v. United States, supra, 336 U.S. at page 453, 69 S.Ct. (at page) 723 (concurring opinion); Blumenthal v. United States, 332 U.S. 539, 559—560, 68 S.Ct. 248, 257, 92 L.Ed. 154; Nash v. United States, 2 Cir., 54 F.2d 1006, 1006 1007, the rule has nonetheless been applied. Blumenthal v. United States, supra; Nash v. United States, supra; United States v. Gottfried, 2 Cir., 165 F.2d 360, 367.' Lutwak v. United States, 344 U.S. 604, 617—618, 619, 73 S.Ct. 481, 489 490, 97 L.Ed. 593. See also, Opper v. United States, 348 U.S. 84, 95, 75 S.Ct. 158, 165, 99 L.Ed. 101.
14
Petitioner contends that Krulewitch v. United States, 336 U.S. 440, 69 S.Ct. 716, 93 L.Ed. 790, requires the exclusion of a post-conspiracy confession of a co-conspirator. That case dealt with the scope of the co-conspirators' exception to the hearsay rule. This Court held that the utterance of a co-conspirator made after the termination of the conspiracy was inadmissible against other co-conspirators. Unlike the instant case, the declarant was not on trial and the question whether his utterance, implicating other alleged conspirators, could be admitted in a joint trial solely against the declarant, under proper limiting instructions, was neither presented nor decided.
15
The issue here is whether, under all the circumstances, the court's instructions to the jury provided petitioner with sufficient protection so that the admission of Whitley's confession, strictly limited to use against Whitley, constituted reversible error. The determination of this issue turns on whether the instructions were sufficiently clear and whether it was reasonably possible for the jury to follow them.5
16
When the confession was admitted in evidence, the trial court said:
17
'The proof of the Government has now been completed except for the testimony of the witness Greenberg as to the alleged statement or affidavit of the defendant Whitley. This affidavit or admission will be considered by you solely in connection with your determination of the guilt or innocence of the defendant Whitley. It is not to be considered as proof in connection with the guilt or innocence of any of the other defendants.
18
'The reason for this distinction is this: An admission by defendant after his arrest of participation in alleged crime may be considered as evidence by the jury against him, together with other evidence, because it is, as the law describes it, an admission against interest which a person ordinarily would not make. However, if such defendant after his arrest implicates other defendants in such an admission it is not evidence against those defendants because as to them it is nothing more than hearsay evidence.'
19
The substance of this admonition was repeated several times during the cross-examination of one of the government agents before whom the confession was made and a final warning to the same effect was included in the court's charge to the jury.6 Nothing could have been more clear than these limiting instructions. Petitioner, who made no objection to these instructions at the trial, concedes their clarity.
20
We may also fairly proceed on the basis that the jury followed these instructions. Several factors favor this conclusion: (1) The conspiracy was so simple in its character that the part of each defendant in it was easily understood. There was no mass trial and no multiplicity of evidentiary restrictions. (2) The separate interests of each defendant were emphasized throughout the trial. Margiasso and petitioner were represented by one attorney. Each of the other defendants was represented by a separate attorney. Throughout the trial, the separate interests of each defendant were repeatedly emphasized by his attorney and recognized by the court.7 A separate trial never was requested on behalf of any defendant. (3) The trial court postponed the introduction of Whitley's confession until the rest of the Government's case was in, thus making it easier for the jury to consider the confession separately from the other testimony. This separation was pointed out by the trial court. Neither side thereafter introduced any evidence. (4) In the main, Whitley's confession merely corroborated what the Government already had established. In the light of the Government's uncontradicted testimony implicating petitioner in the conspiracy, the references to petitioner in the confession were largely cumulative. (5) There is nothing is the record indicating that the jury was confused or that it failed to follow the court's instructions.
21
It is a basic premise of our jury system that the court states the law to the jury and that the jury applies that law to the facts as the jury finds them. Unless we proceed on the basis that the jury will follow the court's instructions where those instructions are clear and the circumstances are such that the jury can reasonably be expected to follow them, the jury system makes little sense. Based on faith that the jury will endeavor to follow the court's instructions, our system of jury trial has produced one of the most valuable and practical mechanisms in human experience for dispensing substantial justice.
22
'To say that the jury might have been confused amonts to nothing more than an unfounded speculation that the jurors disregarded clear instructions of the court in arriving at their verdict. Our theory of trial relies upon the ability of a jury to follow instructions. There is nothing in this record to call for reversal because of any confusion or injustice arising from the joint trial. The record contains substantial competent evidence upon which the jury could find petitioner guilty.' Opper v. United States, 348 U.S. 84, 95, 75 S.Ct. 158, 165, 99 L.Ed. 101. See also, Lutwak v. United States, 344 U.S. 604, 615—620, 73 S.Ct. 481, 488—490, 97 L.Ed. 593; Blumenthal v. United States, 332 U.S. 539, 552 553, 68 S.Ct. 248, 253—254, 92 L.Ed. 154.
23
There may be practical limitations to the circumstances under which a jury should be left to follow instructions but this case does not present them. As a practical matter, the choice here was between separate trials and a joint trial in which the confession would be admitted under appropriate instructions. Such a choice turns on the circumstances of the particular case and lies largely within the discretion of the trial judge. Accordingly, we conclude that leaving petitioner's case to the jury under the instructions here given was not reversible error and the judgment of the Court of Appeals is affirmed.
24
Affirmed.
Appendix to Opinion of the Court.
25
'Whitley's confession reads as follows:
26
'United States of America,
27
'Southern Judicial District of New York,
28
'ss.:
29
'James Whitley, being duly sworn, deposes and says:
30
'I reside at 65 West 133rd Street, Apartment 4 E, New York, N.Y. I make this statement in the presence of my attorney, Mr. Bertram J. Adams of 299 Broadway, New York, N.Y., after being fully advised that under the Constitution of the United States I have the privilege and right of not saying anything at all; that if I answer any question anything I say could be used against me in any criminal proceeding. Being fully aware of my rights, I make this statement of my own free will to Special Investigators Albert Miller and William Greenberg in the office of the Alcohol and Tobacco Tax Division, 143 Liberty Street, New York, N.Y.
31
'Sometime around Thanksgiving of 1949, a friend of mine introduced me to a man known to me as Tony. This man asked me if I wanted to buy some alcohol and I told him I did. The meeting occurred on 126th Street in Harlem. The man then told me to meet him the next day at a candy store on the south side of 119th Street, just east of First Avenue. When I got there, Tony introduced me to a man whose name I do not know. This man told me to meet him that night on 100th Street and Second Avenue. I met him there. He took my car and drove away. A little while later he came back and told me that the car was parked on 103rd Street and Second Avenue. I had purchased two 5-gallon cans of alcohol on that occasion and paid him just before he drove away in my car. Thereafter, I would meet this man around that candy store about twice a week and the same procedure would be followed. This continued until about June or July of 1950.
32
'Tony was about 5 4 in height, about 55 years of age, had a dark complexion and stocky build and, I believe, had brown eyes. He was apparently of Italian extraction. The other man who sold me the alcohol was apparently also of Italian descent, and he had a dark complexion. He spoke in broken English. He had black hair and was aoubt 27 or 28 years of age and was about 5 9 in height. (Sometime in 1950, Investigator Whited of the Alcohol and Tobacco Tax Division asked me about him and showed me his picture.)
33
'At about that time, this man sent me to Carl. He introduced Carl to me and told me that Carl would take care of me from then on. I would meet Carl on Second Avenue between 121st Street and 122nd Street in a seafood restaurant and would purchase the alcohol from him.
34
'Carl is about 5 10 in height, has blond hair, blue eyes, light complexion and is about 30 years of age. He is apparently of Italian descent. He is about 160 pounds. Carl would usually come to my home to see me and ask me if I needed anything.
35
'Just before Carl went to jail in 1950, he introduced me to Bobby. I have been shown a photograph bearing ATU 3643 N.Y. dated 12/29/51 of Orlandi Delli Paoli, and I identify it as that of the man known to me as Bobby. This was sometime in the summer of 1951. Bobby would come to my house to see me. If I placed an order with him he would set the date and the time for seven or eight o'clock in the evening when I was to pick up the alcohol. The first time I met him at 138th Street and Bruckner Boulevard, in the Bronx. He took my car and was gone about one-half hour and then returned with the alcohol. The second time I met him on the corner of Bruckner Boulevard and Soundview Avenue. From then on he would alternate the procedure: I would meet him one night on 138th Street and the next time at Soundview Avenue.
36
'About two months ago, I began meeting Bobby at the Shell gasoline station known as the Bronx River Service Station on Bruckner Boulevard just past the bridge crossing over to Bronx River. I would usually leave my car parked on the street near the gas station and meet Bobby outside of the gas station. He told me not to go into the gas station as the attendant might not like it.
37
'About a month ago, Bobby introduced me to another man whose name I do not know. I have been shown a photograph marked ATU 3642 N.Y., dated 12/29/51 of Carmine Margiasso, and identify it as that of the man to whom Bobby introduced me. Bobby also told me that if he was not present when I met Margiasso, I was not to give Margiasso any money but was to pay him (Bobby) the next time I saw him. Margiasso also followed the same procedure: He would take my car, would be gone about 20 minutes, and then return with the alcohol. Margiasso picked up my car about four times.
38
'My purchases from Bobby would consist of two or three 5-gallon cans of alcohol at a time and were made once or twice a week. The last two times I paid Bobby $38 a can.
39
'On the evening of Friday, December 28, 1951, I had ordered two cans, and when Margiasso took my car I waited in the Lunch room near the gas station. When I thought it was time for Margiasso to return, I went over to the gas station and waited in the office after purchasing a package of cigarettes. Two officers who were Federal Officers came in and placed me and William Hudson under arrest. Shortly after that happened, Bobby drove up and was arrested by the Federal officers.
40
'I have read the above statement consisting of three pages and it is true to the best of my knowledge and belief.
41
'(Signed) James Whitley
42
'James Whitley
43
'Sworn to before me this 5th day of January 1952.
44
'(Signed) William Greenberg
45
'William Greenberg, Spec. Inv.
46
'Witness:
47
'(Signed) Albert Miller
48
'Albert Miller, Spec. Inv.'
49
229 F.2d 319, 324—326.
50
Mr. Justice FRANKFURTER, whom Mr. Justice BLACK, Mr. Justice DOUGLAS, and Mr. Justice BRENNAN join, dissenting.
51
Prosecutions for conspiracy present difficulties and temptations familiar to anyone with experience as a federal prosecutor. The difficulties derive from observance of the rules governing evidence admissible against some but not all defendants in a criminal case. The temptations derive from the advantages of prosecuting in one trial two or more persons collaborating in a criminal enterprise. One of the most recurring of the difficulties pertains to incriminating declarations by one or more of the defendants that are not admissible against others. The dilemma is usually resolved by admitting such evidence against the declarant but cautioning the jury against its use in determining the guilt of the others. The fact of the matter is that too often such admonition against misuse is intrinsically ineffective in that the effect of such a nonadmissible declaration cannot be wiped from the brains of the jurors. The admonition therefore becomes a futile collocation of words and fails of its purpose as a legal protection to defendants against whom such a declaration should not tell. While enforcing the rule of admitting the declaration solely against a declarant and admonishing the jury not to consider it against other defendants, Judge Learned Hand, in a series of cases, has recognized the psychological feat that this solution of the dilemma demands of juries. He thus stated the problem:
52
'In effect, however, the rule probably furthers, rather than impedes, the search for truth, and this perhaps excuses the device which satisfies form while it violates substance; that is, the recommendation to the jury of a mental gymnastic which is beyond, not only their powers, but anybody else's.' Nash v. United States, 2 Cir., 54 F.2d 1006, 1007.
53
It may well be that where such a declaration only glancingly, as it were, affects a co-defendant who cannot be charged with the admitted declaration, the rule enforced by the Court in this case does too little harm not to leave its application to the discretion of the trial judge. But where the conspirator's statement is so damning to another against whom it is inadmissible, as is true in this case, the difficulty of introducing it against the declarant without inevitable harm to a co-conspirator, the petitioner in this case, is no justification for causing such harm. The Government should not have the windfall of having the jury be influenced by evidence against a defendant which, as a matter of law, they should not consider but which they cannot put out of their minds. After all, the prosecution could use the confession against the confessor and at the same time avoid such weighty unfairness against a defendant who cannot be charged with the declaration by not trying all the co-conspirators in a single trial.
54
It is no answer to suggest that here the petitioner-defendant's guilt is amply demonstrated by the uninfected testimony against him. That is the best of reasons for trying him freed from the inevitable unfairness of being affected by testimony not admissible against him. In any event, it is not for an appellate tribunal to know how the jury's mind would have operated if powerfully improper evidence had not in effect been put in the scale against petitioner.
55
In substance, I agree with the dissenting opinion of Judge Frank, below, 2 Cir., 229 F.2d 319, 322, and would therefore reverse.
1
In violation of 18 U.S.C. § 371, 18 U.S.C.A. § 371, and I.R.C.1939, §§ 2803(a), 2806(e), and 2913, 26 U.S.C.A. (I.R.C.1939) §§ 2803(a), 2806(e), 2913. Margiasso and King were also indicted and convicted for the substantive crime of possession of 19 5-gallon cans of unstamped alcohol, and Margiasso of another 113 of such cans.
2
The confession appears as an appendix to the dissenting opinion below in 229 F.2d at pages 324—326. It is also printed as an appendix to this opinion, 352 U.S. 243, 77 S.Ct. 301.
3
On that occasion, the procedure followed closely the pattern observed by government agents on December 18 when, at 9 p.m., Margiasso and petitioner had been at the service station. A Pontiac car, with two occupants, drove up. The occupants got out. Margiasso drove away in their car and, half an hour later, returned with it heavily loaded. When the two men drove it away, government agents tried to follow it. However, they lost it in traffic and no arrests were made. The agents noted the car's license number, found it registered under a false name, and, on December 28, recognized it as the one in which Whitley then came to the service station.
4
Participation in a criminal conspiracy may be shown by circumstantial as well as direct evidence. See, e.g., Blumenthal v. United States, 332 U.S. 539, 557, 68 S.Ct. 248, 256, 92 L.Ed. 154; Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 469, 86 L.Ed. 680; Direct Sales Co. v. United States, 319 U.S. 703, 63 S.Ct. 1265, 87 L.Ed. 1674; United States v. Manton, 2 Cir., 107 F.2d 834, 839.
5
For long-standing recognition that possible prejudice against other defendants may be overcome by clear instructions limiting the jury's consideration of a post-conspiracy declaration solely to the determination of the guilt of the declarant, see also, Cwach v. United States, 8 Cir., 212 F.2d 520, 526—527; United States v. Simone, 2 Cir., 205 F.2d 480, 483—484; Metcalf v. United States, 6 Cir., 195 F.2d 213, 217; United States v. Leviton, 2 Cir., 193 F.2d 848, 855—856; United States v. Gottfriend, 2 Cir., 165 F.2d 360, 367; United States v. Pugliese, 2 Cir., 153 F.2d 497, 500—501; Johnson v. United States, 6 Cir., 82 F.2d 500; Nash v. United States, 2 Cir., 54 F.2d 1006, 1007; Waldeck v. United States, 7 Cir., 2 F.2d 243, 245.
6
'Before you make those motions—I will again advise the jury that any admissions by the defendant Whitley after the date of his arrest can be considered by you in connection with the determination of the guilt or innocence of the defendant Whitley together with the other testimony. But any admissions by the defendant Whitley are not to be considered as proof in connection with the guilt or innocence of any of the other defendants. The reason for that I explained before to you, that the admission by a defendant after his arrest of participation in an alleged crime may be considered as evidence by the jury against him with the other evidence because it is, as the law describes it, an admission against interest which a person ordinarily would not make. However, if such a person after his arrest implicates other defendants in such admission it is not evidence against them, because as to those defendants it is nothing more than hearsay evidence. I advise you of that in connection with the testimony of the last witness (Greenberg) as to any oral statements made by Whitley or any written statements made by Whitley.'
7
Safeguarding the separate interests of the defendants, the court also said:
'The existence of the conspiracy and each defendant's connection with it must be established by individual proof based upon reasonable inference to be drawn from such defendant's own actions, his own conduct, his own declarations, and his own connection with the actions and conduct of the other alleged co-conspiractors.
'To find any defendant guilty of conspiracy you must find that he actively participated therein. Mere knowledge of an illegal act on the part of any co-conspirator is insufficient. Mere association of one defendant with another does not establish the existence of a conspiracy.
'* * * if you find that every circumstance relied upon as incriminating is susceptible of two interpretations, each of which appears to be reasonable, and one of which points to a defendant's guilt, the other to his innocence, it is your duty to accept that of innocence and reject that which points to guilt.'
| 01
|
352 U.S. 249
77 S.Ct. 309
1 L.Ed.2d 290
Honorable Walter J. LA BUY, Petitioner,v.HOWES LEATHER COMPANY, Inc. and Montgomery Ward & Co., Inc.
No. 27.
Argued Oct. 17 and 18, 1956.
Decided Jan. 14, 1957.
Mr. James A. Sprowl, Chicago, Ill., for petitioner.
Mr. Jack I. Levy, Chicago, Ill., for respondents.
Mr. Justice CLARK delivered the opinion of the Court.
1
These two consolidated cases present a question of the power of the Courts of Appeals to issue writs of manadamus to compel a District Judge to vacate his orders entered under Rule 53(b) of the Federal Rules of Civil Procedure, 28 U.S.C.A., referring antitrust cases for trial before a master. The petitioner, a United States District Judge sitting in the Northern District of Illinois, contends that the Courts of Appeals have no such power and that, even if they did, these cases were not appropriate ones for its exercise. The Court of Appeals for the Seventh Circuit has decided unanimously that it has such power and, by a divided court, that the circumstances surrounding the references by the petitioner required it to issue the mandamus about which he complains. 226 F.2d 703. The importance of the question in the administration of the Federal Rules of Civil Procedure, together with the uncertainty existing on the issue among the Courts of Appeals, led to our grant of a writ of certiorari. 350 U.S. 964, 76 S.Ct. 439. We conclude that the Court of Appeals properly issued the writs of mandamus.
2
History of the Litigation.—These petitions for mandamus, filed in the Court of Appeals, arose from two antitrust actions instituted in the District Court in 1950.1 Rohlfing2 involves 87 plaintiffs, all operators of independent retail shoe repair shops. The claim of these plaintiffs against the six named defendants manufacturers, wholesalers, and retail mail order houses and chain operators—is identical. The claim asserted in the complaint is a conspiracy between the defendants 'to monopolize and to attempt to monopolize' and fix the price of shoe repair supplies sold in interstate commerce in the Chicago area, in violation of the Sherman Act, 15 U.S.C.A. §§ 1—7, 15 note. The allegations also include a price discrimination charge under the Robinson-Patman Act, 15 U.S.C.A. §§ 13, 13a, 13b, 21a. Shaffer3 involves six plaintiffs, all wholesalers of shoe repair supplies, and six defendants, including manufacturers and wholesalers of such supplies and a retail shoe shop chain operator. The allegations here also include charges of monopoly and price fixing under the Sherman Act and price discrimination in violation of the Robinson-Patman Act. Both complaints pray for injunctive relief, treble damages, and an accounting with respect to the discriminatory price differentials charged.
3
The record indicates that the cases had been burdensome to the petitioner. In Rohlfing alone, 27 pages of the record are devoted to docket entries reflecting that petitioner had conducted many hearings on preliminary pleas and motions. The original complaint had been twice amended as a result of orders of the court in regard to misjoinders and severance; 14 defendants had been dismissed with prejudice; summary judgment hearings had resulted in a refusal to enter a judgment for some of the defendants on the pleadings; over 50 depositions had been taken; and hearings to compel testimony and require the production and inspection of records were held. It appears that several of the hearings were extended and included not only oral argument but submission of briefs, and resulted in the filing of opinions and memoranda by the petitioner. It is reasonable to conclude that much time would have been saved at the trial had petitioner heard the case because of his familiarity with the litigation.
4
The References to the Master.—The references to the master were made under the authority of Rule 53(b) of the Federal Rules of Civil Procedure.4 The cases were called on February 23, 1955, on a motion to reset them for trial. Rohlfing was 'No. 1 below the black line' on the trial list, which gave it a preferred setting. All parties were anxious for an early trial, but plaintiffs wished an adjournment until May. The petitioner announced that 'it has taken a long time to get this case at issue. I remember hearing more motions, I think, in this case than any case I have ever sat on in this court.' The plaintiffs estimated that the trial would take six weeks, whereupon petitioner stated he did not know when he could try the case 'if it is going to take this long.' He asked if the parties could agree 'to have a Master hear' it. The parties ignored this query and at a conference in chambers the next day petitioner entered the orders of reference sua sponte5. The orders declared that the court was "confronted with an extremely congested calendar' and that 'exception (sic) conditions exist for this reason' requiring the references. The cases were referred to the master 'to take evidence and to report the same to this Court, together with his findings of fact and conclusions of law.' It was further ordered in each case that 'the Master shall commence the trial of this cause' on a certain date and continue with diligence, and that the parties supply security for costs. While the parties had deposited some $8,000 costs, the record discloses that all parties objected to the references and filed motions to vacate them. Upon petitioner's refusal to vacate the references, these mandamus actions were filed in the Court of Appeals seeking the issuance of writs ordering petitioner to do so. These applications were grounded on 28 U.S.C. § 1651(a), 28 U.S.C.A. § 1651(a), the All Writs Act.6 In his answer to the show cause orders issued by the Court of Appeals, petitioner amplified the reasons for the references, stating 'that the cases were very complicated and complex, that they would take considerable time to try,' and that his 'calendar was congested.' Declaring that the references amounted to (226 F.2d 705) 'a refusal on his (petitioner's) part, as a judge, to try the causes in due course,' the Court of Appeals concluded that 'in view of the extraordinary nature of these causes' the references must be vacated 'if we find that the orders were beyond the court's power under the pertinent rule.' 226 F.2d 705, 706. And, it being so found, the writs issued under the authority of the All Writs Act. It is not disputed that the same principles and considerations as to the propriety of the issuance of the writs apply equally to the two cases.
5
The Power of the Courts of Appeals.—Petitioner contends that the power of the Courts of Appeals does not extend to the issuance of writs of mandamus to review interlocutory orders except in those cases where the review of the case on appeal after final judgment would be frustrated. Asserting that the orders of reference were in exercise of his jurisdiction under Rule 53(b), petitioner urges that such action can be reviewed only on appeal and not by writ of mandamus, since by congressional enactment appellate review of a District Court's orders may be had only after a final judgment. The question of naked power has long been settled by this Court. As late as Roche v. Evaporated Milk Association, 1943, 319 U.S. 21, 25, 63 S.Ct. 938, 941, 87 L.Ed. 1185, Mr. Chief Justice Stone reviewed the decisions and, in considering the power of Courts of Appeals to issue writs of mandamus, the Court held that 'the common-law writs, like equitable remedies, may be granted or withheld in the sound discretion of the court.' The recodification of the All Writs Act in 1948, which consolidated old §§ 342 and 377 into the present § 1651(a), did not affect the power of the Courts of Appeals to issue writs of mandamus in aid of jurisdiction. See Bankers Life & Casualty Co. v. Holland, 1953, 346 U.S. 379, 382—383, 74 S.Ct. 145, 147—148, 98 L.Ed. 106. Since the Court of Appeals could at some stage of the antitrust proceedings entertain appeals in these cases, it has power in proper circumstances, as here, to issue writs of mandamus reaching them. Roche, supra, 319 U.S. at page 25, 63 S.Ct. at page 941, and cases there cited. This is not to say that the conclusion we reach on the facts of this case is intended, or can be used, to authorize the indiscriminate use of prerogative writs as a means of reviewing interlocutory orders. We pass on, then, to the only real question involved, i.e., whether the exercise of the power by the Court of Appeals was proper in the cases now before us.
6
The Discretionary Use of the Writs.—It appears from the docket entries to which we heretofore referred that the petitioner was well informed as to the nature of the antitrust litigation, the pleadings of the parties, and the gist of the plaintiffs' claims. He was well aware of the theory of the defense and much of the proof which necessarily was outlined in the various requests for discovery, admissions, interrogatories, and depositions. He heard arguments on motions to dismiss, to compel testimony on depositions, and for summary judgment. In fact, petitioner's knowledge of the cases at the time of the references, together with his long experience in the antitrust field, points to the conclusion that he could dispose of the litigation with greater dispatch and less effort than anyone else. Nevertheless, he referred both suits to a master on the general issue. Furthermore, neither the existence of the alleged conspiracy nor the question of liability vel non had been determined in either case. These issues, as well as the damages, if any, and the question concerning the issuance of an injunction, were likewise included in the references. Under all of the circumstances, we believe the Court of Appeals was justified in finding the orders of reference were an abuse of the petitioner's power under Rule 53(b). They amounted to little less than an abdication of the judicial function depriving the parties of a trial before the court on the basic issues involved in the litigation.
7
The use of masters is 'to aid judges in the performance of specific judicial duties, as they may arise in the progress of a cause,' Ex parte Peterson, 1920, 253 U.S. 300, 312, 40 S.Ct. 543, 547, 64 L.Ed. 919, and not to displace the court. The exceptional circumstances here warrant the use of the extraordinary remedy of mandamus. See State of Maryland v. Soper, 1926, 270 U.S. 9, 30, 46 S.Ct. 185, 189, 70 L.Ed. 449. As this Court pointed out in Los Angeles Brush Mfg. Corp. v. James, 1927, 272 U.S. 701, 706, 47 S.Ct. 286, 288, 71 L.Ed. 481: '* * * (W)here the subject concerns the enforcement of the * * * (r)ules which by law it is the duty of this court to formulate and put in force,' mandamus should issue to prevent such action thereunder so palpably improper as to place it beyond the scope of the rule invoked. As was said there at page 707 of 272 U.S., at page 289 of 47 S.Ct., were the Court '* * * to find that the rules have been practically nullified by a District Judge * * * it would not hesitate to restrain (him) * * *.' The Los Angeles Brush Mfg. Corp. case was cited as authority in 1940 for a per curiam opinion in McCullough v. Cosgrave, 309 U.S. 634, 60 S.Ct. 703, 84 L.Ed. 992, in which the Court summarily ordered vacated the reference of two patent cases to a master. The cases arose from the same District Court in which the Los Angeles Brush Mfg. Corp. case originated largely followed that for the references largely followed that case. It is to be noted that the grounds there are much more inclusive than those set out here, alleging all of those claimed by the petitioner and, in addition, the prolonged illness of the regular judge and the fact that no other judge was available to try the cases. It appears to us a fortiori that these cases were improperly referred to a master.
8
It is claimed that recent opinions of this Court are to the contrary. Petitioner cites Bankers Life & Casualty Co. v. Holland, 1953, 346 U.S. 379, 74 S.Ct. 145, 98 L.Ed. 106, and Parr v. United States, 1956, 351 U.S. 513, 76 S.Ct. 912. The former case did not concern rules promulgated by this Court but, rather, an Act of Congress, the venue statute. Furthermore, there we pointed out that the '* * * All Writs Act is meant to be used only in the exceptional case where there is clear abuse of discretion or 'usurpation of judicial power' * * *.' 346 U.S. at page 383, 74 S.Ct. at page 148. Certainly, as the Court of Appeals found here, there was a clear abuse of discretion. In the Parr case, the District Court had not exceeded or refused to exercise its functions. It dismissed an indictment because the Government had elected to prosecute Parr in another district under a new indictment. The effect of the holding was merely that the dismissal of the first indictment was not an abuse of the discretion vested in the trial judge.
9
It is also contended that the Seventh Circuit has erroneously construed the All Writs Act as 'conferring on it a 'roving commission' to supervise interlocutory orders of the District Courts in advance of final decision.' Our examination of its opinions in this regard leads us to the conclusion that the Court of Appeals has exercised commendable self-restraint. It is true that mandamus should be resorted to only in extreme cases, since it places trial judges in the anomalous position of being litigants without counsel other than uncompensated volunteers. However, there is an end of patience and it clearly appears that the Court of Appeals has for years admonished the trial judges of the Seventh Circuit that the practice of making references 'does not commend itself' and '* * * should seldom be made, and if at all only when unusual circumstances exist.' In re Irving-Austin Building Corp., 7 Cir., 1938, 100 F.2d 574, 577. Again, in 1942, it pointed out that the words 'exception' and 'exceptional' as used in the reference rule are not elastic terms with the trial court the sole judge of their elasticity. 'Litigants are entitled to a trial by the court, in every suit, save where exceptional circumstances are shown.' Adventures in Good Eating, Inc., v. Best Places to Eat, Inc., 7 Cir., 131 F.2d 809, 815. Still the Court of Appeals did not disturb the reference practice by reversal or mandamus until this case was decided in October 1955. Again, Chief Judge Duffy in Krinsley v. United Artists Corp., 7 Cir., 1956, 235 F.2d 253, 257, in which there was an affirmance of a case involving a reference, called attention to the fact that the practice of referring cases to masters was '* * * all too common in the Northern District of Illinois * * *.' The record does not show to what extent references are made by the full bench of the District Court in the Northern District; however, it does reveal that petitioner has referred 11 cases to masters in the past 6 years. But even 'a little cloud may bring a flood's downpour' if we approve the practice here indulged, particularly in the face of presently congested dockets, increased filings, and more extended trials. This is not to say that we are neither aware of nor fully appreciative of the unfortunate congestion of the court calendar in many of our District Courts. The use of procedural devices in the heavily congested districts has proven to be most helpful in reducing docket congestion. Illustrative of such techniques are provision for an assignment commissioner to handle the assignment of all cases; the assignment of judges to handle only motions, pleas, and pretrial proceedings; and separate calendars for civil and criminal trials in cases that have reached issue. We enumerate these merely as an example of the progress made in judicial administration through the use of enlightened procedural techniques. It goes without saying that they can be used effectively only where adaptable to the specific problems of a district. But, be that as it may, congestion in itself is not such an exceptional circumstance as to warrant a reference to a master. If such were the test, present congestion would make references the rule rather than the exception. Petitioner realizes this, for in addition to calendar congestion he alleges that the cases referred had unusual complexity of issues of both fact and law. But most litigation in the antitrust field is complex. It does not follow that antitrust litigants are not entitled to a trial before a court. On the contrary, we believe that this is an impelling reason for trial before a regular, experienced trial judge rather than before a temporary substitute appointed on an ad hoc basis and ordinarily not experienced in judicial work. Nor does petitioner's claim of the great length of time these trials will require offer exceptional grounds. The final ground asserted by petitioner was with reference to the voluminous accounting which would be necessary in the event the plaintiffs prevailed. We agree that the detailed accounting required in order to determine the damages suffered by each plaintiff might be referred to a master after the court has determined the over-all liability of defendants, provided the circumstances indicate that the use of the court's time is not warranted in receiving the proof and making the tabulation.
10
We believe that supervisory control of the District Courts by the Courts of Appeals is necessary to proper judicial administration in the federal system. The All Writs Act confers on the Courts of Appeals the discretionary power to issue writs of mandamus in the exceptional circumstances existing here. Its judgment is therefore affirmed.
11
Affirmed.
12
Mr. Justice BRENNAN, with whom Mr. Justice FRANKFURTER, Mr. Justice BURTON and Mr. Justice HARLAN join, dissenting.
13
The issue here is not whether Judge La Buy's order was reviewable by the Court of Appeals. The sole question is whether review should have awaited final decision in the cause or whether the order was reviewable before final decision by way of a petition under the All Writs Act for the issuance of a writ of mandamus addressed to it. I do not agree that the writ directing Judge La Buy to vacate the order of reference was within the bounds of the discretionary power of the Court of Appeals to issue an extraordinary writ under the All Writs Act.1 Only last Term, in Parr v. United States, 351 U.S. 513, 76 S.Ct. 912, this Court restated those bounds:
14
'The power to issue them is discretionary and it is sparingly exercised. * * * This is not a case where a court has exceeded or refused to exercise its jurisdiction, see Roche v. Evaporated Milk Ass'n, 319 U.S. 21, 26, 63 S.Ct. 938, 941, 87 L.Ed. 1185, nor one where appellate review will be defeated if a writ does not issue, cf. State of Maryland v. Soper, 270 U.S. 9, 29—30, 46 S.Ct. 185, 189, 70 L.Ed. 449. Here the most that could be claimed is that the district courts have erred in ruling on matters within their jurisdiction. The extraordinary writs do not reach to such cases; they may not be used to thwart the congressional policy against piecemeal appeals. Roche v. Evaporated Milk Ass'n, supra, 319 U.S. at page 30, 63 S.Ct. at page 943.' 351 U.S. at page 520, 76 S.Ct. at page 917.2
15
The action of the Court of Appeals for the Seventh Circuit here under review is outside these limitations. The case before the Court of Appeals was 'not a case where a court has exceeded or refused to exercise its jurisdiction * * *.' Rule 53(b) of the Federal Rules of Civil Procedure vested Judge La Buy with discretionary power to make a reference if he found, and he did, that 'some exceptional condition' required the reference.3 Here also 'the most that could be claimed is that the district (court) * * * erred in ruling on matters within (its) jurisdiction.' If Judge La Buy erred in finding that there was an 'exceptional condition' requiring the reference or did not give proper weight to the caveat of the Rule that a 'reference to a master shall be the exception and not the rule,' that was mere error 'in ruling on matters within (the District Court's) jurisdiction.' Such mere error does not bring into play the power of the Court of Appeals to issue an extraordinary writ. Nor did Judge La Buy's order of reference present the Court of Appeals with a case 'where appellate review will be defeated if a writ does not issue.' The litigants may suffer added expense and possible delay in obtaining a decision as a consequence of the reference, but Roche settles that 'that inconvenience is one which we must take if Congress contemplated in providing that only final judgments should be reviewable.'4
16
But, regrettable as is this Court's approval of what I consider to be a clear departure by the Court of Appeals from the settled principles governing the issuance of the extraordinary writs, what this Court says in reaching its result is reason for particularly grave concern. I think this Court has today seriously undermined the long-standing statutory policy against piecemeal appeals. My brethren say: 'Since the Court of Appeals could at some stage of the antitrust proceedings entertain appeals in these cases, it has power in proper circumstances, as here, to issue writs of mandamus reaching them. * * * This is not to say that the conclusion we reach on the facts of this case is intended, or can be used, to authorize the indiscriminate use of prerogative writs as a means of reviewing interlocutory orders.' I understand this to mean that proper circumstances are present for the issuance of a writ in this case because, if the litigants are not now heard, the Court of Appeals will not have an opportunity to relieve them of the burden of the added expense and delay of decision alleged to be the consequence of the reference. But that bridge was crossed by this Court in Roche and Alkali, where this very argument was rejected: 'Here the inconvenience to the litigants results alone from the circumstance that Congress has provided for review of the district court's order only on review of the final judgment, and not from an abuse of judicial power, or refusal to exercise it, which it is the function of mandamus to correct.' 319 U.S. at page 31, 63 S.Ct. at page 944.
17
What this Court is saying, therefore, is that the All Writs Act confers an independent appellate power in the Courts of Appeals to review interlocutory orders. I have always understood the law to be precisely to the contrary. The power granted to the Courts of Appeals by the All Writs Act is not an appellate power but merely an auxiliary power in aid of and to protect the appellate jurisdiction conferred by other provisions of law, e.g., the power to review final decisions granted by 28 U.S.C. § 1291, 28 U.S.C.A. § 1291,5 and to review specified exceptional classes of interlocutory orders granted by 28 U.S.C. § 1292, 28 U.S.C.A. § 1292.6 This holding that an independent appellate power is given by the All Writs Act not only discards the constraints upon the scope of the power to issue extraordinary writs restated in Parr, but, by the very fact of doing so, opens wide the crack in the door which, since the Judiciary Act of 1789, has shut out from intermediate appellate review all interlocutory actions of the District Courts not within the few exceptional classes now specified by the Congress in § 1292.
18
The power of the Courts of Appeals to issue extraordinary writs stems from § 14 of the Judiciary Act of 1789.7 Chief Judge Magruder, in In re Josephson, 1 Cir., 218 F.2d 174, provides us with an invaluable history of this power and of the judicial development of its scope. He demonstrates most persuasively tht '(t)he all writs section does not confer an independent appellate power; the power is strictly of an auxiliary nature, in aid of a jurisdiction granted in some other provision of law, as was sharply pointed out in Roche v. Evaporated Milk Ass'n, 1943, 319 U.S. 21, 29—31, 63 S.Ct. 938 (943—944). * * *' 218 F.2d at page 180.
19
The focal question posed for a Court of Appeals by a petition for the issuance of a writ is whether the action of the District Court tends to frustrate or impede the ultimate exercise by the Court of Appeals of its appellate jurisdiction granted in some other provision of the law. The answer is clearly in the affirmative where, for example, the order of the District Court transfers a cause to a District Court of another circuit for decision. That was Josephson, where the Court of Appeals for the First Circuit held that an order of a District Court in the circuit transferring a case to the District Court of another circuit was within the reach of the Court of Appeals' power under the All Writs Act because 'the effect of the order is that the district judge has declined to proceed with the determination of a case which could eventually come to this court by appeal from a 'final decision'.'8 218 F.2d at page 181. In contrast, a District Court order denying a transfer would not come under the umbrella of power under the All Writs Act, since retention of the cause by the District Court can hardly thwart or tend to defeat the power of the Court of Appeals to review that order after final decision of the case. The distinction between the grant and denial of transfer was recognized in Carr v. Donohoe, 201 F.2d 426, where the Court of Appeals for the Eighth Circuit denied a petition for writ of mandamus directed to an order of a District Court transferring the cause to another District Court within the same circuit. The Court of Appeals properly noted that the order was merely a nonappealable interlocutory order in nowise impairing its actual or potential jurisdiction to review that and any other action after final decision, observing: 'It seems obvious that the transfer of the * * * action * * * to (another district in the same circuit) cannot in any way impair or defeat the jurisdiction of this Court to review any appealable order or judgment which eventually may be entered in the case.'9 201 F.2d at pages 428 429.
20
This Court's reliance upon Los Angeles Brush Mfg. Corp. v. James, 272 U.S. 701, 47 S.Ct. 286, 71 L.Ed. 481, and McCullough v. Cosgrave, 309 U.S. 634, 60 S.Ct. 703, 84 L.Ed. 992, is, in my opinion, misplaced. Those cases involved the power, not of the Courts of Appeals, but of this Court, to issue extraordinary writs. In Josephson, Chief Judge Magruder took pains to emphasize the 'caution that decisions of the Supreme Court of the United States, at least prior to 1948, supporting the issuance, by that Court, of a writ of mandamus directed to a lower federal court, may not safely be relied upon by an intermediate court of appeals as authority for the issuance by the latter court of a writ of mandamus directed to a district court within the circuit. The reason is that the Supreme Court might have been exercising a different sort of power from the strictly auxiliary power given to us under the all writs section.' 218 F.2d at page 179. This 'different sort of power' derived from § 13 of the Judiciary Act of 1789, granting the Supreme Court power to issue writs of mandamus 'in cases warranted by the principles and usages of law.10 This provision, unlike the All Writs Act, was not restricted in its use to aiding the jurisdiction of the appellate court, and therefore might be deemed to have granted a broader power to this Court than that conferred on the Courts of Appeals by the latter statute.
21
Furthermore, Los Angeles Brush Mfg. Corp. was a case where a reference was made, not because a district judge decided that the particular circumstances of the particular case required a reference, but pursuant to an agreement among all the judges of that District Court always to appoint masters to hear patent cases regardless of the circumstances of particular cases. The McCullough situation was much the same. As that case was delimited in Roche, this Court was there confronted by a case of 'the persistent disregard of the Rules of Civil Procedure * * * prescribed by this court.' 319 U.S. at page 31, 63 S.Ct. at page 944.
22
The key to both Los Angeles Brush Mfg. Corp. and McCullough is found in the language in the former in 272 U.S. 706, 47 S.Ct. 288:
23
'* * * we think it clear that, where the subject concerns the enforcement of the equity rules which by law it is the duty of this court to formulate and put in force, and in a case in which this court has the ultimate discretion to review the case on its merits, it may use its power of mandamus and deal directly with the District Court in requiring it to conform to them.' (Emphasis added.)
24
In other words, neither of those cases can be accepted as supporting what the Court of Appeals undertook to do here, both because of the absence in old § 234 of the 'in aid of' jurisdiction limitation now contained in § 1651, and of anything approaching a wholesale disregard of the rules prescribed by this Court, such as was involved there. I subscribe fully to Chief Judge Magruder's conclusion in Josephson:
25
'Contrary to the view which seems to have been occasionally taken, or at least sub silentio assumed, in other courts of appeals, we do not think that 28 U.S.C. § 1651 (28 U.S.C.A. § 1651) (the All Writs Act) grants us a general roving commission to supervise the administration of justice in the federal district courts within our circuit, and in particular to review by a writ of mandamus any unappealable order which we believe should be immediately reviewable in the interest of justice.' 218 F.2d at page 177.
26
The view now taken by this Court that the All Writs Act confers an independent appellate power, although not so broad as 'to authorize the indiscriminate use of prerogative writs as a means of reviewing interlocutory orders,' in effect engrafts upon federal appellate procedure a standard of interlocutory review never embraced by the Congress throughout our history, although it is written into the English Judicature Act11 and is followed in varying degrees in some of the States.12 That standard allows interlocutory appeals by leave of the appellate court. It is a compromise between conflicting viewpoints as to the extent that interlocutory appeals should be allowed.13 The federal policy of limited interlocutory review stresses the inconvenience and expense of piecemeal reviews and the strong public interest in favor of a single and complete trial with a single and complete review. The other view, of which the New York practice of allowing interlocutory review as of right from most orders is the extreme example, perceives danger of possible injustice in individual cases from the denial of any appellate review until after judgment at the trial.14
27
The polestar of federal appellate procedure has always been 'finality,' meaning that appellate review of most interlocutory actions must await final determination of the cause at the trial level. 'Finality as a condition of review is an historic characteristic of federal appellate procedure. It was written into the first Judiciary Act and has been departed from only when observance of it would practically defeat the right to any review at all.' Cobbledick v. United States, 309 U.S. 323, 324—325, 60 S.Ct. 540, 541, 84 L.Ed. 783. The Court's action today shatters that statutory policy. I protest, not only because we invade a domain reserved by the Constitution exclusively to the Congress,15 but as well because the encouragement to interlocutory appeals offered by this decision must necessarily aggravate further the already bad condition of calendar congestion in some of our District Courts and also add to the burden of work of some of our busiest Courts of Appeals. More petitions for interlocutory review, requiring the attention of the Courts of Appeals, add, of course, to the burden of work of those courts. Meanwhile final decision of the cases concerned is delayed while the District Courts mark time awaiting action upon the petitioners. Rarely does determination upon interlocutory review terminate the litigation. Moreover, the District Court calendars become longer with the addition of new cases before older ones are decided. This, then, interposes one more obstacle to the strong effort being made to better justice through improved judicial administration.16
28
The power of the Court of Appeals to correct any error in Judge La Buy's reference is found exclusively in the power to review final decisions under § 1291. The Court of Appeals erred by assuming a nonexistent power under the All Writs Act to review this interlocutory order in advance of final decision. Insofar as the Court approves this error, I must respectfully dissent.
1
Rohlfing v. Cat's Paw Rubber Co., D.C.N.D.Ill., 17 F.R.D. 426, and Shaffer v. U.S. Rubber Co., D.C.N.D.Ill., 99 F.Supp. 886.
2
The figures indicated refer to the number of parties at the time of the petition for mandamus. When the action was originally filed there were 87 plaintiffs and 25 defendants.
3
The figures indicated refer to the number of parties at the time of the petition for mandamus. When the action was originally filed there were 10 plaintiffs and 20 defendants.
4
Rule 53(b) provides:
'(b) Reference. A reference to a master shall be the exception and not the rule. In actions to be tried by a jury, a reference shall be made only when the issues are complicated; in actions to be tried without a jury, save in matters of account, a reference shall be made only upon a showing that some exceptional condition requires it.'
5
The fact that the master is an active practitioner would make the comment of Chief Justice Vanderbilt with regard to the effect of references appropriate here. In his work, Cases and Materials on Modern Procedure and Judicial Administration (1952) at pages 1240—1241, he states:
'There is one special cause of delay in getting cases on for trial that must be singled out for particular condemnation, the all-too-prevalent habit of sending matters to a reference. There is no more effective may of putting a case to sleep for an indefinite period than to permit it to go to a reference with a busy lawyer as referee. Only a drastic administrative rule, rigidly enforced, strictly limiting the matters in which a reference may be had and requiring weekly reports as to the progress of each reference will put to rout this inveterate enemy of dispatch in the trial of cases.'
6
'(a) The Supreme Court and all courts established by Act of Congress may issue all writs necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and principles of law.'
1
'(a) The Supreme Court and all courts established by Act of Congress may issue all writs necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and principles of law.' 28 U.S.C. § 1651(a), 28 U.S.C.A. § 1651(a).
2
Cf. Bankers Life & Cas. Co. v. Holland, 346 U.S. 379, 74 S.Ct. 145, 98 L.Ed. 106; Ex parte Fahey, 332 U.S. 258, 67 S.Ct. 1558, 91 L.Ed. 2041.
3
It should be noted that the objection to references stated by Chief Justice Vanderbilt, as quoted in footnote 5 of the majority opinion, is reflected in New Jersey Revised Rules 4:54—1, which provides as follows: 'No reference for the hearing of a matter shall be made to a master, except under extraordinary circumstances, upon approval of the Chief Justice, or for the taking of a deposition, or as to matters heard by a standing master appointed by the Supreme Court.' (Emphasis added.) If the federal rule required a like consent by a chief judge, a reference without such consent would be outside, the jurisdiction of the District Court, and, therefore, subject to correction by writ of mandamus. The vital distinction is that the federal rule as presently framed vests discretion in the District Courts.
4
319 U.S. at page 30, 63 S.Ct. at page 943. Cf. United States Alkali Export Ass'n v. United States, 325 U.S. 196, 202 203, 65 S.Ct. 1120, 1124—1125, 89 L.Ed. 1554.
5
'The courts of appeals shall have jurisdiction of appeals from all final decisions of the district courts of the United States, * * * except where a direct review may be had in the Supreme Court.' 28 U.S.C. § 1291, 28 U.S.C.A. § 1291.
6
Section 1292, in substance, confers upon the Courts of Appeals jurisdiction of appeals from interlocutory orders of the District Courts relating to injunctions, receivership, and certain admiralty and patent infringement cases.
7
1 Stat. 81, substantially re-enacted in § 262 of the Judicial Code of 1911, 36 Stat. 1162.
8
Accord, Wiren v. Laws, 90 U.S.App.D.C. 105, 194 F.2d 873; Gulf Research & Development Co. v. Harrison, 9 Cir., 185 F.2d 457.
9
In the Josephson case, Chief Judge Magruder said much the same thing:
'If the district judge had held on to the case, i.e., had denied the motion for transfer, such action would have preserved, not frustrated, any potential appellate jurisdiction which we might have had; and we are at a loss to understand how we could properly review on mandamus an order denying a transfer, on the pretense that such a review would be in 'aid' of our appellate jurisdiction.' 218 F.2d at page 181.
10
1 Stat. 80, 81, substantially re-enacted in § 234 of the Judicial Code of 1911, 36 Stat. 1156.
11
Judicature Act, 1925, 15 & 16 Geo. 5, c. 49, § 31(1)(i).
12
E.g. Miss.Code Ann., 1942, § 1148; N.J.Rev.Rules 2:2—3.
13
See e.g., the discussion by Mr. Justice Jacobs in Appeal of Pennsylvania R. Co., 20 N.J. 398, 120 A.2d 94; Crick, The Final Judgment as a Basis for Appeal, 41 Yale L.J. 539; Note, 50 Col.L.Rev. 1102; Note, 58 Yale L.J. 1186; Report, Special Meeting of Judicial Conference of the United States, p. 7 (March 20—21, 1952); Report, Regular Annual Meeting of Judicial Conference of the United States, p. 27 (1953).
14
N.Y.Civ.Prac.Act, § 609.
15
U.S.Const., Art. III, § 1.
16
The seriousness of the problem of calendar congestion in both federal and state courts prompted the Attorney General of the United States, in May 1956, to call a conference on court congestion and delay. This conference resulted in the appointment of a distinguished committee to formulate a frontal attack upon the problem. Rogers, Towards Eliminating Delayed Justice, and address prepared for delivery before the Mid-Atlantic Regional Meeting of the American Bar Association, October 11, 1956.
| 89
|
352 U.S. 191
77 S.Ct. 281
1 L.Ed.2d 246
William Earl FIKES, Petitioner,v.STATE OF ALABAMA.
No. 53.
Argued Dec. 6, 1956.
Decided Jan. 14, 1957.
Defendant's conviction of burglary with intent to commit rape, with death sentence, was affirmed by the Supreme Court of Alabama, 263 Ala. 89, 81 So.2d 303, and defendant brought certiorari. The Supreme Court, Mr. Chief Justice Warren, held that under the circumstances, including failure to take defendant before a magistrate as required by Alabama statute, and his incarceration in isolation for a week of questioning, confessions thus obtained were not voluntary and their use was a denial of due process, notwithstanding absence of physical brutality and long continued interrogation.
Mr. Jack Greenberg, New York City, for petitioner.
Mr. Robert Straub, for respondent.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
Petitioner is under sentence of death for the crime of burglary with intent to commit rape. He seeks reversal of the judgment through a writ of certiorari to the Supreme Court of Alabama, which sustained the conviction. 263 Ala. 89, 81 So.2d 303. Petitioner raised three issues in support of his position that he had been denied due process of law. He alleged: 1. Admission into evidence of two confessions extracted from him under circumstances demonstrating that the statements were coerced or involuntary.
2
2. Denial by the trial judge of petitioner's request to testify about the manner in which the confessions were obtained without subjecting himself to unlimited cross-examination as to the facts of the crime charged.
3
3. Selection of the grand jury which indicted him by a method that systematically discriminated against members of his race.
4
We granted certiorari to determine whether the requirements of due process under the Fourteenth Amendment had been satisfied in these aspects of petitioner's conviction. 350 U.S. 993, 76 S.Ct. 549. The judgment must be reversed because of the admission of the confessions. Therefore, it is unnecessary at this time to decide or discuss the other two issues raised by petitioner.
5
The facts essential to the present decision are as follows:
6
During the early months of 1953, a number of housebreakings, some involving rape or attempted rape, were committed in the City of Selma, Alabama. The present trial concerned one of these crimes.1 On the night of April 24, 1953, an intruder broke into the apartment of the daughter of the city's mayor. She awoke to find a Negro man sitting on her with a knife at her throat. A struggle ensued which carried the woman and her assailant through the bedroom, hall, and living room, where she finally was able to seize the knife, at which point he fled. These rooms were all lighted. The victim testified that the attacker 'had a towel draped over his head' throughout the incident; she did not identify petitioner as the attacker in her testimony at the trial. However, two other women testified to similar housebreakings (one of which resulted in rape), and they each identified petitioner as the burglar. This testimony was admitted at the present trial 'solely on the question of intent and identity of defendant and his motive on the occasion then on trial.' 263 Ala. at page 99, 81 So.2d at page 313. This, with the challenged confessions, was substantially all the evidence concerning the crime at the trial.
7
About midnight on May 16, 1953, petitioner was apprehended in an alley in a white neighborhood in Selma by private persons, who called the police. The officers jailed him 'on an open charge of investigation.' The next day, a Sunday, the questioning that led to the challenged confessions began. It is, of course, highly material to the question before this Court to ascertain petitioner's character and background. He is a Negro, 27 years old in 1953, who started school at age eight and left at 16 while still in the third grade. There was testimony by three psychiatrists at the trial, in connection with a pleaded defense of insanity, to the effect that petitioner is a schizophrenic and highly suggestible. His mother testified that he had always been 'thick-headed.' Petitioner worked in a gas station in his home town of Marion, some 30 miles from Selma. So far as appears, his only prior involvement with the law was a conviction for burglary of a store in November 1949; he was released on parole in January 1951.
8
The questioning of petitioner was conducted principally by Captain Baker of the Selma police. His testimony that he repeatedly advised petitioner 'that he was entitled to counsel and his various rights' must be viewed in the light of the facts concerning petitioner's mentality and experience just outlined.
9
The interrogation began on Sunday, May 17, with a two-hour session in the morning in Captain Baker's office. That afternoon, petitioner was questioned for two and a half or three hours, during part of which time he was driven around the city to some of the locations of the unsolved burglaries. During this ride, petitioner also talked to the sheriff of his home county, who had been called to Selma at petitioner's request, according to Captain Baker's testimony.
10
On Monday, petitioner talked with his employer. Captain Baker continued questioning for two hours in the morning. He testified that a warrant was served on petitioner in jail, but that petitioner did not request a preliminary hearing. In fact, he was not taken before any judicial officer prior to the confessions.2 That afternoon, petitioner was driven to Kilby State Prison, which is located in another county, about 55 miles from Selma and some 80 miles from petitioner's home in Marion. The testimony of the responsible officers was that this removal was done for petitioner's protection, although no specific threat against him had been made.
11
At Kilby Prison, petitioner was kept in the 'segregation unit,' out of contact with other prisoners. He saw only the jailers and Selma officers who drove over to question him. Petitioner was interrogated in an office in the prison. On Monday, there was questioning there for 'several hours' in the afternoon and 'a little while' after supper. The next interrogation was on Wednesday. It lasted 'several hours' in the afternoon and into the evening. The following day petitioner was questioned for two hours in the afternoon and about an hour and a half in the evening. That day his father came to the prison to see him, but was refused admittance.
12
On Thursday evening, the first confession occurred. It was introduced at the trial through a tape recording. The confession consists of an interrogation by Captain Baker. Petitioner responded chiefly in yes-or-no answers to his questions, some of which were quite leading or suggestive.
13
Petitioner was questioned again for three hours on Saturday, May 23. That day, a lawyer who came to the prison to see him was turned away. On Sunday, petitioner's father was allowed to visit his son. This was the only contact petitioner had during the entire period in question with family or friend, or for that matter with anyone he knew, except the talks at the beginning of the week with the sheriff of his own county, in the presence of Selma officers, and with his employer.
14
In the second week of his incarceration, on Tuesday afternoon, petitioner was questioned for about two and a half hours. At this time, the second confession was made. Like the other, it consists of responses to questions. The second confession was taken down by a prison stenographer and signed by petitioner after it was read to him.
15
This outline of the facts surrounding the taking of the confessions comes entirely from the testimony of the State witnesses, who under the circumstances were the only ones who could testify at the trial on this subject other than the prisoner himself. He did not testify, because of the trial judge's ruling that he would be subject to unlimited cross-examination concerning the offense charged against him.3 Standing alone, the State's evidence establishes that the confessions in the present case were not voluntary within the meaning of the decisions of this Court.
16
Here the prisoner was an uneducated Negro, certainly of low mentality, if not mentally ill. He was first arrested by civilians, lodged in jail, and then removed to a state prison far from his home. We do not criticize the decision to remove the prisoner before any possibility of violence might mature, but petitioner's location and the conditions of his incarceration are facts to be weighed in connection with the issue before us. For a period of a week, he was kept in isolation, except for sessions of questioning. He saw no friend or relative. Both his father and a lawyer were barred in attempts to see him. The protections to be afforded to a prisoner upon preliminary hearing were denied him, contrary to the law of Alabama.4 He was questioned for several hours at a time over the course of five days preceding the first confession, and again interrogated at length before the written confession was secured.
17
There is no evidence of physical brutality, and particular elements that were present in other cases in which this Court ruled that a confession was coerced do not appear here. On the other hand, some of the elements in this case were not present in all of the prior cases. The objective facts in the present case are very much like those that were before the Court in Turner v. Commonwealth of Pennsylvania, 338 U.S. 62, 69 S.Ct. 1352, 93 L.Ed. 1810, while the present petitioner was a weaker and more susceptible subject than the record in that case reveals Turner to have been. And cf. Johnson v. Commonwealth of Pennsylvania, 340 U.S. 881, 71 S.Ct. 191, 95 L.Ed. 640. The totality of the circumstances that preceded the confessions in this case goes beyond the allowable limits. The use of the confessions secured in this setting was a denial of due process.
18
Neither Stein v. People of State of New York, 346 U.S. 156, 73 S.Ct. 1077, 97 L.Ed. 1522, nor any of the other cases relied on by respondent stands in the way of this conclusion. In Stein, the Court said:
19
'The limits in any case depend upon a weighing of the circumstances of pressure against the power of resistance of the person confessing. what would be overpowering to the weak of will or mind might be utterly ineffective against an experienced criminal.' 346 U.S. at page 185, 73 S.Ct. at page 1093.
20
That is the same standard that has been utilized in each case, according to its total facts. Cf. e.g., Watts v. State of Indiana, 338 U.S. 49, 53, 69 S.Ct. 1347, 1349, 93 L.Ed. 1801; Lyons v. State of Oklahoma, 322 U.S. 596, 602—605, 64 S.Ct. 1208, 1212, 1213, 88 L.Ed. 1481. We hold that the circumstances of pressure applied against the power of resistance of this petitioner, who cannot be deemed other than weak of will or mind, deprived him of due process of law. So viewed, the judgment of conviction in this case cannot stand.
21
The judgment is reversed, and the cause is remanded for proceedings not inconsistent with this opinion.
22
Reversed and remanded.
23
Mr. Justice FRANKFURTER, whom Mr. Justice BRENNAN joins, concurring.
24
In joining the Court's opinion I should like to add a few words. A case like this is not easy for one who believes very strongly that adequate power should accompany the responsibility of the States for the enforcement of their criminal law. But the Due Process Clause of the Fourteenth Amendment has placed limitations upon the discretion, unbridled for all practical purposes, that belonged to the States prior to its adoption, and, more particularly, confines their freedom of action in devising criminal procedure. It is, I assume, common ground that if this record had disclosed an admission by the police of one truncheon blow on the head of petitioner a confession following such a blow would be inadmissible because of the Due Process Clause. For myself, I cannot see the difference, with respect to the 'voluntariness' of a confession, between the subversion of freedom of the will through physical punishment and the sapping of the will appropriately to be inferred from the circumstances of this case—detention of the accused virtually incommunicado for a long period; failure to arraign him in that period;1 horse-shedding of the accused at the intermittent pleasure of the police until confession was forthcoming. No single one of these circumstances alone would in my opinion justify a reversal. I cannot escape the conclusion, however, that in combination they bring the result below the Plimsoll line of 'due process.'
25
A state court's judgment of conviction must not be set aside by this Court where the practices of the prosecution, including the police as one of its agencies, do not offend what may fairly be deemed the civilized standards of the Anglo-American world.2 This record reveals a course of conduct that, however conscientiously pursued, clearly falls below those standards. Such conduct is not only not consonant with our professions about criminal justice, as against authoritarian methods that we denounce. It derives from an attitude that is inimical, if experience is any guide, to the most enduring interests of law.
26
Mr. Justice HARLAN, whom Mr. Justice REED and Mr. Justice BURTON join, dissenting.
27
The setting aside of this conviction, in my opinion, oversteps the boundary between this Court's function under the Fourteenth Amendment and that of the state courts in the administration of state criminal justice. I recognize that particularly in 'coerced confession' cases the boundary line is frequently difficult to draw. But this Court has recognized that its corrective power over state courts in criminal cases is narrower than that which it exercises over the lower federal courts. Watts v. State of Indiana, 338 U.S. 49, 50, 69 S.Ct. 1347, 1348, 93 L.Ed. 1801.
28
In this instance I do not think it can be said that the procedures followed in obtaining petitioner's confessions violated constitutional due process. The elements usually associated with cases in which this Court has been constrained to act are, in my opinion, not present here in constitutional proportions, separately or in combination. Concededly, there was no brutality or physical coercion. And psychological coercion is by no means manifest. While the total period of interrogation was substantial, the questioning was intermittent; it never exceeded two or three hours at a time, and all of it took place during normal hours; 'relay' tactics, such as were condemned in Turner v. Commonwealth of Pennsylvania, 338 U.S. 62, 69 S.Ct. 1352, 93 L.Ed. 1810, and other cases,1 were not employed. True, petitioner's mental equilibrium appears to have been less than normal, but these facts were before the trial judge and the jury. The absence of arraignment, much as that practice is to be deprecated, loses in significance in light of the State's representation at the oral argument that this was not an unusual thing in Alabama. As this Court recognizes, it did not of itself make the confessions inadmissible. Petitioner's removal to Kilby Prison, after authorization by a state circuit judge, stands on quite a different footing from the episode in Ward v. State of Texas, 316 U.S. 547, 62 S.Ct. 1139, 86 L.Ed. 1663. And I am not satisfied that there was any deliberate purpose to keep the petitioner incommunicado, such as existed in Watts v. State of Indiana, supra; Turner v. Commonwealth of Pennsylvania, supra; and Harris v. State of South Carolina, supra. Before the first confession, petitioner, at his own request, was permitted to see the sheriff of his home county, and his employer. His father, although not permitted to see petitioner on the day of the first confession,2 was allowed to see him before the second confession. The lawyer who sought to see petitioner was refused permission because, having no authority from petitioner or his family to represent him, the prison authorities evidently thought he was trying to solicit business.
29
The Supreme Court of Alabama, after reviewing the record, has sustained the conviction. 263 Ala. 89, 81 So.2d 303. I find nothing here beyond a state of facts upon which reasonable men might differ in their conclusions as to whether the confessions had been coerced. In the absence of anything in the conduct of the state authorities which 'shocks the conscience' or does 'more than offend some fastidious squeamishness or private sentimentalism about combatting crime too energetically,' Rochin v. People of State of California, 342 U.S. 165, 172, 72 S.Ct. 205, 209, 96 L.Ed. 183, I think that due regard for the division between state and federal functions in the administration of criminal justice requires that we let Alabama's judgment stand.
1
Petitioner apparently was indicted for six of the burglary incidents. See 263 Ala. at page 96, 81 So.2d at page 310. At the oral argument, counsel stated that shortly before the present trial petitioner had been convicted of another of these burglaries, one which had resulted in a rape, and sentenced to imprisonment for 99 years. It appears that no appeal was taken.
2
Alabama law specifically required bringing petitioner promptly before a magistrate:
'It is the duty of any private person, having arrested another for the commission of any public offense, to take him without unnecessary delay before a magistrate, or to deliver him to some one of the officers specified in section 152 of this title (police officers), who must forthwith take him before a magistrate.' Code of Ala. 1940, Tit. 15, § 160.
Under the cases of that State, violation of this requirement does not render inadmissible a confession secured during such detention. See Ingram v. State, 252 Ala. 497, 42 So.2d 36. Nevertheless, such an occurrence is 'relevant circumstantial evidence in the inquiry as to physical or psychological coercion.' Stein v. People of State of New York, 346 U.S. 156, 187, 73 S.Ct. 1077, 1094, 97 L.Ed. 1522.
Petitioner was admitted to Kilby Prison on an order or letter from a State Circuit Judge. The nature of this procedure does not clearly appear from the record, but it is conceded that petitioner was not taken before the judge.
3
The issue was raised at the trial in this colloquy:
'Solicitor Hare: The State offers in evidence the recording heretofore testified to by the witness presently on the stand (Captain Baker).
'Attorney Hall: If the Court please, the defendant objects to what purports to be a recording made by this witness, on the ground that sufficient predicate has not been laid.
'The Court: Over-rule the objection.
'Attorney Hall: We except, sir, and we would like to make another motion. We would like to make an offer to put this defendant on the stand for the purpose of refuting certain allegations by the State with reference to the voluntary nature of what purports to be certain extra judicial admissions, and for no other purpose.
'Solicitor Hare: Now, may it please the Court, if the defendant takes the stand, I insist that he be subject to cross-examination on any and every item that is in evidence. I am not willing to make any agreement of limitation.
'The Court: And you are only offering the testimony of the defendant for the purpose of refuting the voluntary nature of this recording?
'Attorney Hall: Just that, sir.
'The Court: I sustain the State. If the State is not willing to reach a stipulation or agreement on that, but insists that you open defendant for cross-examination of any and every nature, I over-rule the motion.' (R. 230—231.)
4
See note 2, supra.
1
Flouting of the requirement of prompt arraignment prevailing in most States is in and of itself not a denial of due process. Cf. McNabb v. United States, 318 U.S. 332, 63 S.Ct. 608, 87 L.Ed. 819. But it is to disregard experience not to recognize that the ordinary motive for such extended failure to arraign is not unrelated to the purpose of extracting confessions.
2
'Ours is the accusatorial as opposed to the inquisitorial system.' Watts v. State of Indiana, 338 U.S. 49, 54, 69 S.Ct. 1347, 1350, 93 L.Ed. 1801. An analysis of the particular phase of the judicial process involved in applying the Due Process Clause to state convictions secured on the basis of confessions has been attempted in my opinions in Malinski v. People of State of New York, 324 U.S. 401, 412, 65 S.Ct. 781, 786, 89 L.Ed. 1029; Haley v. State of Ohio, 332 U.S. 596, 601, 68 S.Ct. 302, 304, 92 L.Ed. 224; Watts v. State of Indiana, supra.
1
See, for example, Watts v. State of Indiana, supra; Haley v. State of Ohio, 332 U.S. 596, 68 S.Ct. 302, 92 L.Ed. 224; Harris v. State of South Carolina, 338 U.S. 68, 69 S.Ct. 1354, 93 L.Ed. 1815.
2
The record is silent as to why the father did not gain admittance on this first visit.
| 01
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352 U.S. 270
77 S.Ct. 269
1 L.Ed.2d 306
Jose SORIANO, Petitioner,v.The UNITED STATES.
No. 49.
Argued Dec. 5, 1956.
Decided Jan. 14, 1957.
Messrs. Prew Savoy, Washington, D.C., and George W. Foley, New York City, for petitioner.
Mr. Roger D. Fisher, Washington, D.C., for respondent.
Mr. Justice CLARK delivered the opinion of the Court.
1
This suit was filed in the Court of Claims by petitioner, a resident of the Philippines, to recover just compensation for the requisitioning by Philippine guerrilla forces of certain foodstuffs, supplies, equipment, and merchandise during the Japanese occupation of the Philippine Islands. While decision on the merits would require a determination of the status of Philippine guerrillas as a unit operating in the service of the United States, we do not reach that question. We have determined that the Court of Claims lacks jurisdiction because the claim was not filed within the period provided by the statute, 62 Stat. 976, 28 U.S.C. § 2501, 28 U.S.C.A. § 2501.1
2
On July 26, 1941, pursuant to the Philippine Independence Act,2 President Roosevelt ordered the Philippine Army into the service of the armed forces of the United States.3 After the fall of Bataan and Corregidor in 1942, elements of this Philippine Army fled to the hills and continued military resistance against the Japanese as guerrilla units. These units, from time to time, requisitioned and commandeered supplies from Philippine civilians. Petitioner contends that these units were part of the United States Army having implied authority to bind the United States to pay for such supplies. He alleges that from September 1942 until the last requisition in January 1945 he delivered supplies to these guerrilla units of the value of $119,765.75. He filed a claim for this amount with the United States Army Claims Service on March 30, 1948. This claim was denied on June 21, 1948.
3
Thereafter on April 26, 1951, more than six years after the last alleged requisition, this action was filed in the United States Court of Claims. The Government moved to dismiss on several grounds, including (1) that the statutory limitation period had run, and (2) that the units were part of the Philippine forces for which the United States was in no manner responsible. In a per curiam order, 133 Ct.Cl. 971, after issue was drawn on the pleadings, the Court of Claims dismissed the suit on the authority of Logronio v. United States, 1955, 133 F.Supp. 395, 132 Ct.Cl. 596. In effect, this reaffirmed its earlier holdings that members of the guerrilla units of the Philippine Army were not part of the Army of the United States.4 The limitation question was not passed upon.
4
We granted certiorari, 351 U.S. 917, 76 S.Ct. 710, to determine the validity of the claims of the petitioner and others in like position. After issuance of the writ in this case, the Court of Claims in Compania Maritima v. United States, 1956, 145 F.Supp. 935, 941, 136 Ct.Cl. —-, held that a Philippine resident seeking redress against the United States was under a legal disability while hostilities between Japan and the United States continued. The court further held that the claim of such a person must be filed within three years 'after the disability ceases,' i.e., by September 2, 1948. Apprehensive that this rule might be applied to his case, petitioner requested and we granted permission to argue the limitation question which, as we have said, had been raised but not considered at the time of the dismissal by the Court of Claims.
5
Petitioner urges that his suit was timely filed because he was first required to present his claim to the Army Claims Service before he could prosecute the action in the Court of Claims. This administrative procedure, he points out, was not exhausted until June 21, 1948, and this suit was filed on April 26, 1951, less than three years thereafter. But, if he should fail with this contention, he argues that the war suspended the running of the statute and it was, therefore, tolled until September 2, 1945, when hostilities ceased with Japan. We cannot agree with either contention.
6
It has been settled since Kendall v. United States, 1883, 107 U.S. 123, 2 S. Ct. 277, 27 L.Ed. 437, that the Congress in creating the Court of Claims restricted that court's jurisdiction. In Kendall this Court held that the Congress in the Act creating the Court of Claims gave the Government's consent to be sued therein only in certain classes of claims and that no others might be asserted against it, including 'claims which are declared barred if not asserted within the time limited by the statute.' Id., 107 U.S. at page 125, 2 S.Ct. at page 278. As to the latter cases, jurisdiction was given only over those filed 'within six years after such claim first accrues,' unless the claimant was 'under legal disability or beyond the seas at the time the claim accrues,' in which event suit must 'be filed within three years after the disability ceases.' 62 Stat. 976, 28 U.S.C. § 2501, 28 U.S.C.A. § 2501. As was said in Kendall, supra, 'The court cannot superadd to those enumerated * * *,' it having 'no more authority to ingraft (another) disability arising upon the statute than a disability from sickness, surprise, or inevitable accident, which might prevent a claimant from suing within the time prescribed.' Id., 107 U.S. at page 125, 2 S.Ct. at page 278.
7
Petitioner asserts that his action did not accrue until the denial of the claim by the Army Claims Service. At the same time, he admits that the claim filed there was based on the alleged delivery of supplies, etc., on the promise of future payment. The claim, if allowed, was against the Philippine Government, not the United States.5 The claim asserted in this proceeding, on the contrary, is against the United States and based on the alleged taking of property without just compensation in violation of the Fifth Amendment. Petitioner would have us hold that this just compensation case could not be filed until after an administrative denial of his claim filed with the Army Claims Service. But, even if the claims were laid on the same theory and each was directed against the United States, Congress has made no such requirement. It has not so restricted the jurisdiction of the Court of Claims.6 Under the circumstances, for us to say that the exhaustion of administrative remedies in such case is a prerequisite to the jurisdiction of the Court of Claims would but 'engraft (another) disability upon the statute' and thus frustrate the purpose of Congress. Furthermore, it would be a limitless extension of the period of limitation that Congress expressly provided for the prosecution of claims against the Government in the Court of Claims. This we cannot do.
8
We now reach petitioner's second contention. The cause of action as alleged by petitioner was for just compensation for supplies, etc., taken from him by guerrillas during the Japanese occupation of the Philippines. He alleges in his complaint that the action, if any he has, accrued at the time of the taking and could only be maintained within six years thereafter but for the existence of the hostilities which he claims tolled the statute. He depends on Hanger v. Abbott, 1868, 6 Wall, 532, 18 L.Ed. 939, to support this position. Such reliance is misplaced. That case involved private citizens, not the Government. It has no applicability to claims against the sovereign. See Haycraft v. United States, 1875, 22 Wall. 81, 22 L.Ed. 738.
9
To permit the application of the doctrine urged by petitioner would impose the tolling of the statute in every time-limit-consent Act passed by the Congress. For example, statutes permitting suits for tax refunds, tort actions, alien property litigation, patent cases, and other claims against the Government would all be affected. Strangely enough, Congress would be required to provide expressly in each statute that the period of limitation was not to be extended by war. But Congress was entitled to assume that the limitation period it prescribed meant just that period and no more. With this intent in mind, Congress has passed specific legislation each time it has seen fit to toll such statutes of limitations because of war.7 And this Court has long decided that limitations and conditions upon which the Government consents to be sued must be strictly observed and exceptions thereto are not to be implied. United States v. Sherwood, 1941, 312 U.S. 584, 590—591, 61 S.Ct. 767, 771, 85 L.Ed. 1058, and cases there cited. Furthermore, even if hostilities prevented petitioner from filing his claim and this condition could be regarded as creating a 'disability,' the claim would nonetheless be barred by the express terms of this statute because not filed within three years after the cessation of hostilities, to wit, before September 2, 1948. Likewise, if petitioner claimed such a disability under the Trading with the Enemy Act,8 he would not better his position, for timely action was necessary by the same date. The same is true of any claim under the disability specifically provided for 'persons beyond the seas,'9 even if this provision were applicable to petitioner. Such applicability has not been urged and we do not pass upon it.
10
We are not unmindful that the enforcement of this rule might result in hardship in some cases, and perhaps frustrate the expectations of some Philippine citizens who in good faith supplied recognized guerrilla units. Such considerations are not for us, as this Court can enforce relief against the sovereign only within the limits established by Congress. Petitioner here hd six years within which to act. He filed no claim whatever until after the expiration of three years from the date he alleges the last taking occurred. This claim was filed with the Army Claims Service on the basis of an alleged contract. That claim was denied within less than three months after it was filed. This left petitioner over two and a half years additional time to pursue his just compensation remedy. Still he did nothing for almost three years, when he filed this suit in the Court of Claims. By that time his claim, on any theory, was barred by statute. The judgment is therefore affirmed.
11
Affirmed.
12
Mr. Justice DOUGLAS, with whom Mr. Justice BLACK and Mr. Justice FRANKFURTER concur, dissenting.
13
If petitioner had sued in the Court of Claims without first presenting his claim to the Army Claims Service, I think the Court of Claims would have been earranted in dismissing it. The Army Claims Service was established April 7, 1945, by General Douglas MacArthur to process claims such as this one. The Army Claims Service questioned whether expenses incurred by guerrilla organizations could be paid out of the appropriated funds. On August 6, 1945, General MacArthur advised the Army Claims Service that it could authorize the payment of claims such as this one. That directive stated:
14
'* * * The United States Army will assume the responsibility for paying certain claims arising out of activities of guerrilla forces in the Philippines. That responsibility will be limited to claims for the value of goods or services essential for carrying on operations against the enemy.
15
'* * * No payments will be made on claims arising out of activities of other than recognized guerrilla forces.
16
'* * * Such claims will be paid from the appropriation, 'Expenses, Army of the Philippines'.
17
'* * * Payment will be made only on claims where there was a clear understanding at the time the supplies and equipment or services were purchased or contracted for that payment would eventually be made. There must have been a clear intention on the part of the guerrilla commander and of the vendor or employee that an obligation was being created. It must be definitely shown that the provision of such supplies, equipment or services was not intended as a patriotic donation to the common cause against the enemy. It must also be definitely shown that the supplies, equipment or services were essential for the operation of the guerrilla forces.' That directive was issued in accordance with the Act of July 3, 1945, 59 Stat. 401—402, which appropriated money for 'all expenses necessary for the mobilization, operation, and maintenance of the Army of the Philippines.' The expenditure and accounting were to be in the manner prescribed by the President. Id., at page 402. And the moneys were to be available to the Philippine Government 'as authorized by the Commanding General, United States Army Forces in the Far East.' Id., at page 402. The Government's brief advises us that nearly $300,000,000 was appropriated by the Congress for that purpose through July 3, 1945. And on February 18, 1946, $200,000,000 more was added to that appropriation. 60 Stat. 14.
18
The statutory scheme for payment of the expenses of the guerrilla forces, therefore, demonstrates that this claim, if it can be sustained on the merits, runs against the United States. The fact that approved claims were paid by the Philippine Government is a mere administrative detail. For it acted in this respect only as a disbursing agency for the United States.
19
Hence petitioner properly first presented his claim to the Army Claims Service, which rejected it June 21, 1948. The six-year statute should be held to run from that date. For it is the general rule that, where a claim must first be processed by an administrative agency, it does not accure until the agency refuses payment. See United States v. Taylor, 104 U.S. 216, 222, 26 L.Ed. 721. Cf. United States v. Clark, 96 U.S. 37, 43—44, 24 L.Ed. 696.
20
That was the view of the Court of Claims in an earlier case involving such a problem. See Dino v. United States, 119 Ct.Cl. 307. I think the Court of Claims position in the Dino case is the correct one.
1
62 Stat. 976, 28 U.S.C. § 2501, 28 U.S.C.A. § 2501, the pertinent part of which reads.
'Every claim of which the Court of Claims has jurisdiction shall be barred unless the petition thereon is filed, or the claim is referred by the Senate or House of Representatives, or by the head of an executive department within six years after such claim first accrues.
'A petition on the claim of a person under legal disability or beyond the seas at the time the claim accrues may be filed within three years after the disability ceases.'
2
The Philippine Independence Act of March 24, 1934, 48 Stat. 456 et seq., provides in pertinent part:
'(12) The Philippine Islands recognizes the right of the United States to expropriate property for public uses, to maintain military and other reservations and armed forces in the Philippines, and, upon order of the President, to call into the service of such armed forces all military forces organized by the Philippine government.' Id., at 457.
3
Military Order of President Roosevelt, dated July 26, 1941, 6 Fed.Reg. 3825, which provides in pertinent part:
'* * * I hereby call and order into the service of the armed forces of the United States for the period of the existing emergency, and place under the command of a General Officer, United States Army, to be designated by the Secretary of War from time to time, all of the organized military forces of the Government of the Commonwealth of the Philippines * * *.'
4
Victorio v. United States, Ct.Cl.1950, 91 F.Supp. 748, vacated, 1952, 106 F.Supp. 182, 122 Ct.Cl. 708; Logronio v. United States, 1955, 133 F.Supp. 395, 132 Ct.Cl. 596, overruling the second Victorio opinion, supra.
5
On August 6, 1945, the functions of the Army Claims Service, which had been established in April 1945, were extended to include consideration of certain types of guerrilla claims, such as claims of civilians for compensation for supplies delivered to the guerrillas during the Japanese occupation, provided 'there was a clear understanding at the time the supplies and equipment or services were purchased or contracted for that payment would eventually be made.' See the order of General MacArthur to the Commanding General, U.S. Armed Forces, Western Pacific, dated August 6, 1945. Such claims were actually asserted against the Philippine Government and, if and when approved by the Claims Service, were paid by that Government. In 1946, Congress advanced $200,000,000 for the expenses of the Army of the Philippines, 60 Stat. 14, and at various other times during the war similar special appropriations were made. From such appropriations the Philippine Government paid whatever claims were found valid. For further discussion of the operation of the Army Claims Service in the Philippines, see Victorio v. United States, Ct.Cl.1950, 91 F.Supp. 748.
6
While the Court of Claims held in Dino v. United States, 1951, 119 Ct.Cl. 307, that a claim similar to the one here involved should first be asserted in the appropriate administrative agency, this rule has now been abandoned by that court. See, e.g., the discussion in Tan v. United States, 1952, 102 F.Supp. 552, 122 Ct.Cl. 662, and the cases there cited.
7
Congress specifically tolled the statute of limitations for some actions against the Government during the Second World War, e.g., Soldiers' and Sailors' Civil Relief Act, 54 Stat. 1181, 50 U.S.C.App. § 525, 50 U.S.C.A.Appendix, § 525, providing for suspension of limitations in suits by or against servicemen; and § 34 of the Trading with the Enemy Act, 60 Stat. 925—926, 50 U.S.C.App. § 34(a), 50 U.S.C.A.Appendix, § 34(a), suspending limitations in suits against the Alien Property Custodian respecting vested property. However, the statute of limitations has not been enlarged by Congress for claims such as petitioner's.
8
40 Stat. 411, 50 U.S.C.App. § 2, 50 U.S.C.A.Appendix, § 2:
'That the word 'enemy,' as used herein, shall be deemed to mean, for the purposes of such trading and of this Act—
'(a) Any individual, partnership, or other body of individuals, of any nationality, resident within the territory (including that occupied by the military and naval forces) of any nation with which the United States is at war, or resident outside the United States and doing business within such territory, and any corporation incorporated within such territory of any nation with which the United States is at war or incorporated within any country other than the United States and doing business within such territory.'
9
The present saving clause (see note 1, supra) was enacted in 1948. However, the pre-1948 statute, 36 Stat. 1139, 28 U.S.C. (1940 ed.) § 262, also had a saving clause which contained as a specific disability 'persons beyond the seas at the time the claim accrued.' The 1948 amendment merely substituted the general saving clause for the prior clause which specifically set forth various disabilities.
| 89
|
352 U.S. 220
77 S.Ct. 287
1 L.Ed.2d 267
The LEITER MINERALS, Inc., Petitioner,v.UNITED STATES of America et al.
No. 26.
Argued Nov. 6 and 7, 1956.
Decided Jan. 14, 1957.
Mr. Samuel W. Plauche , Jr., Lake Charles, La., for petitioner.
Mr. Perry W. Morton, Washington, D.C., for respondent United States of America.
Mr. Charles D. Marshall, New Orleans, La., for respondents The California Co. and Allen L. Lobrano.
Mr. Justice FRANKFURTER delivered the opinion of the Court.
1
This case presents for decision important questions regarding the applicability to the United States of the restrictions against stay of state court proceedings contained in 28 U.S.C. § 2283, 28 U.S.C.A. § 2283 and the propriety of the injunction decreed by the District Court and sustained by the Court of Appeals. Petitioner in 1953 had filed a petitory action in a Louisiana state court against respondent-mineral-lessees of the United States. In that action, a suit by one out of possession claiming title to, and possession of, immovables, petitioner sought to have itself declared owner of the mineral rights under land owned by the United States, and it also sought an accounting for oil and other minerals removed by respondent-lessees under their lease from the United States. Petitioner founded its claim on Louisiana Act No. 315 of 1940, La.Rev.Stat., 1950, 9:5806, which, it alleged, made 'imprescriptible' a reservation of mineral rights in a deed of December 21, 1938, to the United States by its predecessor in title.1
2
Respondent-lessees filed exceptions in the state court proceedings, urging that under Louisiana law the lessor should be made a party and the lessees discharged from the suit, that this was essentially a suit against the United States, which had not consented to be sued, that the United States was an indispensable party, and that no cause of action had been stated. The state trial court found that a cause of action had been stated, and it overruled the exceptions.
3
At this point the United States, joining petitioner and other interested parties as defendants, brought the present suit in the District Court for the Eastern District of Louisiana to quiet title to the mineral rights; it also sought a preliminary injunction to restrain petitioner from prosecuting its action in the state court. The United States based its claim of ownership on the provision in the 1938 deed from petitioner's predecessor in title that the reservation of mineral rights would expire on April 1, 1945, subject to certain conditions not material to this case. The United States claimed that irreparable injury in the form of loss of royalties would result from any temporary, wrongful dispossession of its lessees by the state court proceedings. Affidavits were also submitted in support of the claim that permanent loss of wells currently producing oil would probably result from any temporary cessation of production. The petitioner moved to dismiss the United States' complaint on the ground that the state court had already assumed jurisdiction over the property in question; in the alternative, petitioner moved to stay the federal proceedings pending determination of the state court action because questions of state law were involved.
4
The District Court held that, since the United States was not a party to the state court suit, the title of the United States could be tried only in the federal court action and that an injunction against prosecution of the state proceedings should issue to protect its jurisdiction pending determination of the ownership of the property. 127 F.Supp. 439. The Court of Appeals affirmed, holding that the preliminary injunction was proper because 'the district court under the clear provisions of the statute, 28 U.S.C. § 1345 (28 U.S.C.A. § 1345), became vested with exclusive jurisdiction to determine the title of the United States to the mineral rights claimed by appellant.' 224 F.2d 381, 383 384. Because of the presence of important and difficult questions of federal-state relations, questions more difficult than the Government appears to have found them, we granted certiorari. 350 U.S. 964, 76 S.Ct. 439.
5
28 U.S.C. § 2283, 28 U.S.C.A. § 2283, provides:
6
'A court of the United States may not grant an injunction to stay proceedings in a State court except as expressly authorized by Act of Congress, or where necessary in aid of its jurisdiction, or to protect or effectuate its judgments.'
7
It must first be decided whether this section applies to stays sought by the United States because different answers to this question will put different aspects on other issues in the case. An analogous problem was presented in United States v. United Mine Workers, 330 U.S. 258, 67 S.Ct. 677, 91 L.Ed. 884, where the Court held that the provisions of the Norris-La Guardia Act, 47 Stat. 70, 29 U.S.C. § 101, 29 U.S.C.A. § 101, that no federal court had jurisdiction, subject to qualifications, to issue an injunction in labor disputes to prohibit certain acts, did not apply to the United States. The Norris-La Guardia Act, like 28 U.S.C. § 2283, 28 U.S.C.A. § 2283, effected, in general language, a limitation on the jurisdiction of the federal courts. Furthermore, since it was largely the diversity jurisdiction which spawned the substantive problems that the Norris-La Guardia Act removed from the federal courts, the limitations on the federal courts imposed by the Norris-La Guardia Act, like those of 28 U.S.C. § 2283, 28 U.S.C.A. § 2283, were in an area of federal-state relations calling for particular circumspection in adjudication.
8
In interpreting the general language of the Norris-La Guardia Act, the Court relied heavily on 'an old and wellknown rule,' albeit a rule of construction, 'that statutes which in general terms divest pre-existing rights or privileges will not be applied to the sovereign without express words to that effect.' 330 U.S. at page 272, 67 S.Ct. at page 686. While, strictly speaking, any 'pre-existing' rights would have to be found in the 1789—1793 pre-statute period,2 the rationale of the rule requires not that the rights be 'pre-existing' but rather that they would exist apart from the statute. There can be no doubt, apart from the restrictions of 28 U.S.C. § 2283, 28 U.S.C.A. § 2283; of the right of the United States to enjoin state court proceedings whenever the prerequisites for relief by way of injunction be present. Treating the rule invoked in the United Mine Workers case merely as an aid to construction, it would by itself lead us to hold that the general language of 28 U.S.C. § 2283, 28 U.S.C.A. § 2283, did not apply to the United States in the absence of countervailing considerations, such as significant legislative history pointing toward its inclusion or inferences clearly to be drawn from relevant presuppositions for so including it.
9
In United Mine Workers, the Court did not rely entirely on the rule of construction because its reading of the Act as a whole and the legislative history supported the conclusion that the United States was not to be included. In this case, there is no legislative material to support or to gainsay the applicability of the rule of construction. There is, however, a persuasive reason why the federal court's power to stay state court proceedings might have been restricted when a private party was seeking the stay but not when the United States was seeking similar relief. The statute is designed to prevent conflict between federal and state courts. This policy is much more compelling when it is the litigation of private parties which threatens to draw the two judicial systems into conflict than when it is the United States which seeks a stay to prevent threatened irreparable injury to a national interest. The frustration of superior federal interests that would ensue from precluding the Federal Government from obtaining a stay of state court proceedings except under the severe restrictions of 28 U.S.C. § 2283, 28 U.S.C.A. § 2283, would be so great that we cannot reasonably impute such a purpose to Congress from the general language of 28 U.S.C. § 2283, 28 U.S.C.A. § 2283, alone. It is always difficult to feel confident about construing an ambiguous statute when the aids to construction are so meager, but the interpretation excluding the United States from the coverage of the statute seems to us preferable in the context of healthy federal-state relations.3
10
The question still remains whether the granting of an injunction was proper in the circumstances of this case. We start with one certainty. The suit in the federal court was the only one that could finally determine the basic issue in the litigation whether the title of the United States to the mineral rights was affected by Louisiana Act No. 315 of 1940. The United States was not a party to the state suit and, under settled principles, title to land in possession of the United States under a claim of interest cannot be tried as against the United States by a suit against persons holding under the authority of the United States. See United States v. Lee, 106 U.S. 196, 1 S.Ct. 240, 27 L.Ed. 171. Although the state court might mould petitioner's suit to try title into a suit for possession or might merely order respondent-lessees to account for minerals removed, nevertheless such proceedings could not settle the basic issue in the litigation and might well cause confusion if they resulted in a judgment inconsistent with that subsequently rendered by the federal court.
11
Petitioner relies heavily on United States v. Bank of New York & Trust Co., 296 U.S. 463, 56 S.Ct. 343, 80 L.Ed. 331. There, in a federal district court proceeding, the United States was claiming by assignment certain funds of three Russian insurance companies that were being held in the custody of a state court, in connection with the liquidation of the companies, subject to court orders concerning distribution to claimants under the state insurance laws. On the basis of this claim, the United States sought to enjoin distribution of the funds and to require payment of them to it. This Court, affirming dismissal of the complaints and denial of the injunction, held that the state court had obtained jurisdiction over the funds first and that the litigation should be resolved in that court. The Court also noted that there were numerous other claimants, indispensable parties, who had not been made parties to the federal court suit. In remitting the United States to the state court, the Court saw no 'impairment of any rights' of the United States or 'any sacrifice of its proper dignity as a sovereign.' Id., 296 U.S. at pages 480—481, 56 S.Ct. at pages 348—349.
12
The situation in the present case is different. All the parties in the state court proceeding have been joined in the federal proceeding. Moreover, the Bank of New York case presented the more unusual situation where the United States, like any private claimant, made a claim against funds that it never possessed and that were in the hands of depositaries appointed by the state court. In this case, a private party is seeking by a state proceeding to obtain property currently in the hands of persons holding under the United States; the United States is seeking to protect that possession and quiet title by a federal court proceeding. Therefore, since the position of the United States is essentially a defensive one, we think that it should be permitted to choose the forum in this case, even though the state litigation has the elements of an action characterized as quasi in rem. We therefore hold that the District Court properly exercised its jurisdiction to entertain the suit in the federal court and to prevent the effectuation of state court proceedings that might conflict with the ultimate federal court judgment.
13
One further aspect of the case remains to be considered. The District Court advanced this additional ground for its decision:
14
'Moreover, if the state court suit is allowed to proceed to final judgment, the rights of the United States to the property in question will actually be determined 'behind its back' * * * for the reason that, since ownership of these mineral rights will turn on an interpretation of a state statute * * * this court and the appellate federal courts may be required, under Erie Railroad Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188, to follow that judgment in spite of the fact that the United States is not a party to those proceedings * * *.' 127 F.Supp. at page 444.
15
But the fact that the United States is not a party to the state court litigation does not mean that the federal court should initiate interpretation of a state statute. In fact, where questions of constitutionality are involved—and the Government contends that an application of the state statute adverse to its interests would be unconstitutional—our rule has been precisely the opposite: 'as questions of federal constitutional power have become more and more intertwined with preliminary doubts about local law, we have insisted that federal courts do not decide questions of constitutionality on the basis of preliminary guesses regarding local law.' Spector Motor Service v. McLaughlin, 323 U.S. 101, 105, 65 S.Ct. 152, 154, 89 L.Ed. 101; see Stainback v. Mo Hock Ke Lok Po, 336 U.S. 368, 383, 69 S.Ct. 606, 614, 93 L.Ed. 741; Railroad Commission of Texas v. Pullman Co., 312 U.S. 496, 498-502, 61 S.Ct. 643, 644, 646, 85 L.Ed. 971.
16
The Government contends that Act No. 315 of 1940 does not apply when the parties themselves have contracted for a reservation of specific duration and that if the statute is construed to apply to this situation it would impair the obligation of the Government's contract. Petitioner disagrees. The Supreme Court of Louisiana has never considered the specific issue or even discussed generally the rationale of the statute, especially with reference to problems of constitutionality. The District Court recognized the importance of the statute in deciding this case; it also recognized that a problem of interpretation was involved, that the statute cannot be read by him who runs. What are the situations to which the statute is applicable? Is the statute merely declaratory of prior Louisiana law? What are the problems that it was designed to meet? The answers to these questions are or may be relevant. Before attempting to answer them and to decide their relation to the issues in the case, we think it advisable to have an interpretation, if possible, of the state statute by the only court that can interpret the statute with finality, the Louisiana Supreme Court. The Louisiana declaratory judgment procedure appears available to secure such an interpretation, La.Rev.Stat., 1950, § 13:4231 et seq., and the United States of course may appear to urge its interpretation of the statute. See Stanley v. Schwalby, 147 U.S. 508, 512—513, 13 S.Ct. 418, 419, 420, 37 L.Ed. 259. It need hardly be added that the state courts in such a proceeding can decide definitively only questions of state law that are not subject to overriding federal law.
17
We therefore modify the judgment of the Court of Appeals to permit an interpretation of the state statute to be sought with every expedition in the state court in conformity with this opinion.
18
Modified and affirmed.
19
Mr. Justice DOUGLAS, dissenting in part.
20
I agree that the state action was properly enjoined; and so I concur in the opinion of the Court to that extent. But I dissent from the direction to the District Court to hold the case while the parties repair to the state court to get an interpretation of the Louisiana statute around which this litigation turns.
21
That procedure is an advisable one where private parties question the constitutionality of a state statute. An authoritative construction of the state law may avoid the constitutional issue or put it in new perspective. See Spector Motor Service v. McLaughlin, 323 U.S. 101, 104—105, 65 S.Ct. 152, 154, 89 L.Ed. 101. In the Spector case, the plaintiff's claim was within the jurisdiction of the federal court solely because of the attack on the constitutionality of a state statute. Under 28 U.S.C. § 1331, 28 U.S.C.A. § 1331, the federal district court has jurisdiction where the matter in controversy exceeds the jurisdictional amount 'and arises under the Constitution, laws or treaties of the United States.' In litigation in the federal courts under that statute, the necessity of construing state law arises because of the federal court's duty to avoid if possible a federal constitutional question. Siler v. Louisville & Nashville R. Co., 213 U.S. 175, 29 S.Ct. 451, 53 L.Ed. 753. In the Spector case, then, matters of state law were only ancillary to the primary responsibility of the federal court to resolve the constitutional issues.
22
But here, although potential constitutional questions may lurk in the background, this litigation primarily concerns not federal questions but title to land claimed by the United States. It is litigation which Congress by 28 U.S.C. §§ 1345, 1346, 28 U.S.C.A. §§ 1345, 1346, has entrusted to the federal district court. Those sections allow civil litigation of the United States whether it involves federal or state law questions—to be conducted in the federal courts. In that situation it is the duty of the federal court to decide all issues in the case—those turning on state law as well as those turning on federal law. In Meredith v. City of Winter Haven, 320 U.S. 228, 64 S.Ct. 7, 88 L.Ed. 9, a case in the federal courts by reason of diversity of citizenship, we refused to remit the parties to the state court for decision of difficult state law questions. We held that it was the duty of the federal court to decide all issues in the case—state or federal, difficult or easy. And see Propper v. Clark, 337 U.S. 472, 69 S.Ct. 1333, 93 L.Ed. 1480. There have been exceptions to this policy, notably in bankruptcy proceedings where trustees are sometimes sent into state courts to obtain adjudications on local law questions pertinent to the administration of the bankrupt's estate. See Thompson v. Magnolia Co., 309 U.S. 478, 60 S.Ct. 628, 84 L.Ed. 876. It is peculiarly inappropriate to follow that course here. Congress has decided that the United States should have the benefit of the protection of its own courts in this type of litigation. We properly hold that the District Court, not the state court, has jurisdiction of the controversy. But we beat the devil around the bush when, having taken the litigation out of the state court, we send the parties back to the state court for its construction of Louisiana law which is the most significant issue in the case. The problem is not only to construe the state statute but to construe it constitutionally. The federal court can make that construction as readily as the state court. That is the congressional scheme and we should not change it by judicial fiat.
1
The reservation, in its pertinent portion, provided: 'The Vendor reserves from this sale the right to mine and remove, or to grant to others the right to mine and remove, all oil, gas and other valuable minerals which may be deposited in or under said lands, and to remove any oil, gas or other valuable minerals from the premises; the right to enter upon said lands at any time for the purpose of mining and removing said oil, gas and minerals, said right, subject to the conditions hereinafter set forth, to expire April 1, 1945, it being understood, however, that the vendors will pay to the United States of America, 5% of the gross proceeds received by them as royalties or otherwise from all oil or minerals so removed from in or under the aforedescribed lands, until such time as the vendors
shall have paid to the United States of America, the sum of $25,000, being the purchase price paid by said United States of America for the aforedescribed properties.
'Provided that at the termination of the ten (10) year period of reservation, if not extended, or at the termination of any extended period in case the operation has not been carried on for the number of days stated, the right to mine shall terminate, and complete fee in the land become vested in the United States.
'The reservation of the oil and mineral rights herein made for the original period of ten (10) years and for any extended period or periods in accordance with the above provisions shall not be affected by any subsequent conveyance of all or any of the aforementioned properties by the United States of America, but said mineral rights shall, subject to the conditions above * * * set forth, remain vested in the vendors.'
Act No. 315 provides: '* * * when land is acquired by conventional deed or contract, condemnation or expropriation proceedings by the United States of America, or any of its subdivisions or agencies, from any person, firm or corporation, and by the act of acquisition, verdict or judgment, oil, gas, and/or other minerals or royalties are reserved, or the land so acquired is by the act of acquisition conveyed subject to a prior sale or reservation of oil, gas and/or other minerals or royalties, still in force and effect, said rights so reserved or previously sold shall be imprescriptible.' See also the prior Act No. 151 of 1938 providing that prescription should not run against a reservation of mineral rights in real estate acquired by the United States or the State of Louisiana.
2
The basic provisions of 28 U.S.C. § 2283 go back to 1793, 1 Stat. 335, 28 U.S.C.A. § 2283.
3
Most of the lower federal courts that have considered this problem have, without much discussion, reached the same result. E.g., United States v. Taylor's Oak Ridge Corp., D.C., 89 F.Supp. 28; United States v. Cain, D.C., 72 F.Supp. 897; United States v. Phillips, D.C., 33 F.Supp. 261, reversed on other grounds, 312 U.S. 246, 61 S.Ct. 480, 85 L.Ed. 800; United States v. McIntosh, D.C., 57 F.2d 573; United States v. Babcock, D.C., 6 F.2d 160, reversed for modification 7 Cir., 9 F.2d 905; United States v. Inaba, D.C., 291 F. 416. But see United States v. Land Title Bank & Trust Co., 3 Cir., 90 F.2d 970; United States, for Use of Reconstruction Finance Corp. v. Certain Parcels of Land, D.C., 62 F.Supp. 1017, appeal dismissed by stipulation United States v. Treasure Co., 9 Cir., 151 F.2d 1022.
| 89
|
352 U.S. 280
77 S.Ct. 307
1 L.Ed.2d 314
Robert W. JAFFKE, Petitioner,v.William C. DUNHAM, Trustee of the Estate of Robert L. Knetzer, Bankrupt.
No. 60.
Argued Dec. 12, 1956.
Decided Jan. 14, 1957.
Mr. Herbert J. Miller, Jr., Washington, D.C., for petitioner.
Mr. G. William Horsley, Springfield, Ill., for respondent.
PER CURIAM.
1
We granted certiorari in this case to review a judgment of the Court of Appeals for the Seventh Circuit, 229 F.2d 232, reversing an order of the District Court for the Southern District of Illinois, sitting in bankruptcy, which required respondent as trustee of a bankrupt's estate to pay $27,400 to petitioner. 351 U.S. 949, 76 S.Ct. 847. The District Court's order was based on a finding that, subsequent to the date of the adjudication of bankruptcy, the bankrupt had obtained money by fraud from the petitioner and had turned over $27,400 of that money to respondent. At the hearing before the District Court, petitioner had sought to introduce into evidence an affidavit in which the bankrupt stated that he had paid $36,000 of the money he had received from petitioner to the respondent. At the conclusion of the hearing, the District Court sustained respondent's motion to strike the affidavit.
2
On appeal, the Court of Appeals held that petitioner had failed to prove that any specific portion of the money that he had given the bankrupt became a part of the funds in the hands of respondent. Because petitioner had not cross-appealed, the Court of Appeals held that it could not consider the action of the District Court in striking the bankrupt's affidavit from the record.
3
A successful party in the District Court may sustain its judgment on any ground that finds support in the record. If the District Court was in error in striking an admissible affidavit, a cross-appeal was not a prerequisite for the Court of Appeals to rule on the admissibility of the affidavit, and finding it admissible, to find that it afforded evidence in support of the District Court judgment. United States v. American Railway Express Co., 265 U.S. 425, 435—436, 44 S.Ct. 560, 563—564, 68 L.Ed. 1087; Langnes v. Green, 282 U.S. 531, 538—539, 51 S.Ct. 243, 246, 75 L.Ed. 520. Since the Court of Appeals did not consider the admissibility and weight of the affidavit, we remand to the Court of Appeals for its consideration of those issues.
4
The claim in this case is that relevant, admissible evidence established a constructive trust. Whether it did so or not is a question of Illinois law. The Court of Appeals, in the view it took of the case before it, did not reach this local question. On remand, that question too must be considered by the Court of Appeals.
5
Reversed and remanded.
| 89
|
352 U.S. 282
77 S.Ct. 330
1 L.Ed.2d 331
NATIONAL LABOR RELATIONS BOARD, Petitioner,v.LION OIL COMPANY and Monsanto Chemical Company.
No. 4.
Argued Oct. 8, 1956.
Decided Jan. 22, 1957.
Mr. Theophil C. Kammholz, Washington, D.C., for the petitioner.
Mr. Jeff Davis, El Dorado, Ark., for the respondents.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
In this case we are called upon again to interpret § 8(d) of the National Labor Relations Act, as amended.1 See Mastro Plastics Corp. v. National Labor Relations Board, 350 U.S. 270, 76 S.Ct. 349. In particular we are concerned with s 8(d)(4), which provides that a party who wishes to modify or terminate a collective bargaining contract must continue 'in full force and effect, without resorting to strike or lockout, all the terms and conditions of the existing contract for a period of sixty days after * * * notice (of his wish to modify or terminate) is given or until the expiration date of such contract, whichever occurs later.' Since § 8(d) defines the duty to bargain collectively, a violation of § 8(d)(4) constitutes a refusal to bargain, an unfair labor practice for employers, § 8(a)(5), and unions, § 8(b)(3). The last sentence of § 8(d) contains an additional sanction: an employee who strikes within the specified 60-day period loses his status as an employee for the purposes of §§ 8, 9 and 10 of the Act. The sole question presented by the petition for certiorari is:
2
Whether the requirement of this Section is satisfied where a contract provides for negotiation and adoption of modifications at an intermediate date during its term, and a strike in support of modification demands occurs after the date on which such modifications may become effective—and after the 60-day notice period has elapsed—but prior to the terminal date of the contract.
3
We are told by the Solicitor General that the question is of major importance in the negotiation and administration of hundreds of collective bargaining agreements throughout the country; that there is a decided trend among unions and employers to execute contracts of longer duration than formerly and to include provisions for reopening to negotiate changes during the contract term.2 Because of the importance of the question, we granted certiorari, 350 U.S. 986, 76 S.Ct. 471, to review a decision of the Court of Appeals for the Eighth Circuit to the effect that § 8(d)(4) bans strikes to obtain modifications of a contract until the contract by its terms or by the action of the parties has terminated.
4
On October 23, 1950, respondent Lion Oil Co. and the Oil Workers International Union, CIO, entered into a contract which provided:
5
'This agreement shall remain in full force and effect for the period beginning October 23, 1950, and ending October 23, 1951, and thereafter until canceled in the manner hereinafter in this Article provided.
6
'This agreement may be canceled and terminated by the Company or the Union as of a date subsequent to October 23, 1951, by compliance with the following procedure:
7
'(a) If either party to this agreement desires to amend the terms of this agreement, it shall notify the other party in writing of its desire to that effect, by registered mail. No such notice shall be given prior to August 24, 1951. Within the period of 60 days, immediately following the date of the receipt of said notice by the party to which notice is so delivered, the Company and the Union shall attempt to agree as to the desired amendments to this agreement.
8
'(b) If an agreement with respect to amendment of this agreement has not been reached within the 60-day period mentioned in the sub-section immediately preceding, either party may terminate this agreement thereafter upon not less than sixty day's written notice to the other. Any such notice of termination shall state the date upon which the termination of this agreement shall be effective.'
9
On August 24, 1951, the union served written notice on the company of its desire to modify the contract.3 Negotiations began on the contractual changes proposed by the union. The union members voted for a strike on February 14, 1952, but the strike, thrice postponed as negotiations continued, did not actually begin until April 30, 1952. The union never gave notice to terminate the contract as contemplated by the quoted contractual provision. Therefore, at all relevant times a collective bargaining agreement was in effect. On August 3, a new contract was executed, and the strikers began to return to work the following day. Certain actions of the company during the strike were the basis of unfair labor practice charges by the union upon which a complaint issued.
10
The Labor Board found that the company was guilty of unfair labor practices under § 8(a)(1), (3) and (5) of the Act. The company defended on the ground that the strike, because it occurred while the contract was in effect, was in violation of § 8(d)(4). A majority of the Board rejected this defense, holding that
11
'The term 'expiration date' as used in section 8(d)(4) * * * has a two-fold meaning; it connotes not only the terminal date of a bargaining contract, but also an agreed date in the course of its existence when the parties can effect changes in its provisions.'
12
The Board held that since, under the contract in dispute, October 23, 1951, was such an 'agreed date,' the notice given August 24 followed by a wait of more than 60 days satisfied the statute. The company was ordered to cease and desist and, affirmatively, to make whole employees found to have been discriminated against. 109 N.L.R.B. 680, 683.
13
On the company's petition for review, the Court of Appeals set aside the Board's order. 8 Cir., 221 F.2d 231. The court held that the 'expiration date' of the contract was the date on which all rights and obligations under it would cease; that the second notice required to bring about this termination not having been given, the strike violated § 8(d)(4) and the strikers therefore lost their status as employees entitled to the protection of the Act.4
14
In Mastro Plastics Corp. v. National Labor Relations Board, supra, we had before us another provision of § 8(d). What we said there in ruling out a narrowly literal construction of the words of the statute is equally apropos here. 'If the above words are read in complete isolation from their context in the Act, such an interpretation is possible. However, 'In expounding a statute, we must not be guided by a single sentence or member of a sentence, but look to the provisions of the whole law, and to its object and policy.' United States v. Boisdore § Heirs, 8 How. 113, 122, 12 L.Ed. 1009.' 350 U.S. at page 285, 76 S.Ct. at page 359. Moreover, in Mastro Plastics we cautioned against accepting a construction that 'would produce incongruous results.' Id., 350 U.S. at page 286, 76 S.Ct. at page 360.
15
That § 8(d)(4) is susceptible of various interpretation is apparent when § 8(d) is read as a whole. Its ambiguity was recognized by the Joint Committee of Congress created by the very act of which § 8(d) was a part to study the operation of the federal labor laws.5 Members of the National Labor Relations Board, the agency specially charged by Congress with effectuating the purposes of the national labor legislation, have expressed divergent views on the proper construction of § 8(d)(4); none of them has taken the position adopted by the court below.6 In the face of this ambiguity it will not do simply to say Congress could have made itself clearer and automatically equate the phrase 'expiration date' only with the date when a contract comes to an end.
16
We find our guide to the general context of the statute in Mastro Plastics. In that case we recognized a 'dual purpose' in the Taft-Hartley Act—to substitute collective bargaining for economic warfare and to protect the right of employees to engage in concerted activities for their own benefit. 350 U.S. at page 284, 76 S.Ct. at page 358. A construction which serves neither of these aims is to be avoided unless the words Congress has chosen clearly compel it. The restriction on employees' concerted activities which would result from the construction placed upon § 8(d)(4) by the Court of Appeals is obvious.7 Too, we think it would discourage the development of long-term bargaining relationships. Unions would be wary of entering into long-term contracts with machinery for reopening them for modification from time to time, if they thought the right to strike would be denied them for the entire term of such a contract, though they imposed no such limitations on themselves.
17
We do not believe that the language used by Congress requires any such result. Section 8(d)(1) provides that no party to an existing collective bargaining contract 'shall terminate or modify such contract, unless the party desiring such termination or modification—(1) serves a written notice upon the other party to the contract of the proposed termination or modification sixty days prior to the expiration date thereof * * *.' The phrase 'expiration date' is repeated in § 8(d)(1) and again in the 'whichever occurs later' clause of § 8(d)(4) upon which this case turns. The use of the three words 'termination,' 'modification' and 'expiration' is significant. We conceive that a notice of desired modification would typically be served in advance of the date when the contract by its own terms was subject to modification. Notice of desired termination would ordinarily precede the date when the contract would come to an end by its terms or would be automatically renewed in the absence of notice to terminate. Therefore we conclude that Congress meant by 'expiration date' in § 8(d)(1) to encompass both situations, and the same phrase in § 8(d)(4) must carry the same meaning. 'Expiration' has no such fixed and settled meaning as to make this an unduly strained reading.
18
Our conclusion is buttressed by a provision of § 8(d) which was added by the Conference Committee.8
19
'(T)he duties * * * imposed (by subsections (2), (3) and (4)) shall not be construed as requiring either party to discuss or agree to any modification of the terms and conditions contained in a contract for a fixed period, if such modification is to become effective before such terms and conditions can be reopened under the provisions of the contract.'
20
The negative implication seems clear: Congress recognized a duty to bargain over modifications when the contract itself contemplates such bargaining. It would be anomalous for Congress to recognize such a duty and at the same time deprive the union of the strike threat which, together with 'the occasional strike itself, is the force depended upon to facilitate arriving at satisfactory settlements.'9
21
Although a 1948 committee report is no part of the legislative history of a statute enacted in 1947, we note that the Joint Committee on Labor-Management Relations, made up of members of the Congress which passed the Taft-Hartley Act, in its final report reached the same conclusion we do:
22
'Reading section 8(d) as a whole seems to lead to the conclusion that the act permits a strike, after a 60-day notice, in the middle of a contract which authorizes a reopening on wages. Use of the words 'or modify' and 'or modification' in the proviso, and use of 'or modification' in section 8(d)(1), and the statement in the final paragraph of the section that the parties are not required to agree to any modification effective before the contract may be reopened under its terms, all seem to contemplate the right of either party to insist on changes in the contract if they have so provided. The right of the union would be an empty one without the right to strike after a 60-day notice.'10
23
The contemporary legislative history manifests no real recognition of the problem before us.11 A reading of the committee reports and the floor debates alone could well lead to the conclusion that both the sponsors and the opponents of the bill saw in § 8(d)(4) no more than a means for preventing 'quickie' strikes by requiring a 'cooling-off' period which would not in any circumstances exceed 60 days.12 But the language used in the statute goes beyond this limited purpose. Significance must be given to the clause, 'or until the expiration date of such contract, whichever occurs later.' We believe our construction gives meaning to the congressional language which accords with the general purpose of the Act.
24
Applying that construction to the facts of this case, we hold that the notice and waiting requirements of § 8(d) were fully satisfied. October 23, 1951, was the first date upon which the contract by its terms was subject to amendment. Notice of proposed amendments was served 60 days in advance. The strike did not occur until long afterward. The fact that on October 23 the contract became terminable upon further notice by either party is immaterial. One thing the most authoritative legislative gloss on § 8(d), the report of the Senate Committee, makes clear is that the statutory notice requirement operates wholly independently of whatever notice requirement the parties have fixed for themselves.13 The situation here is not different, so far as the applicability of the statute is concerned, from that of a fixed-term contract with a clause providing for reopening at some specific time.
25
Nor can we accept respondents' alternative contention that, even apart from § 8(d), the strike was in breach of contract and the strikers were for that reason not entitled to relief at the hand of the Board. Respondents rely upon National Labor Relations Board v. Sands Mfg. Co., 306 U.S. 332, 59 S.Ct. 508, 83 L.Ed. 682. In Sands, as in this case, the contract did not contain an express nostrike clause. Employees there refused in the course of the contract to continue work 'in accordance with their contract.' Id., 306 U.S. at page 344, 59 S.Ct. at page 514. The refusal occurred midway in a fixed-term contract which did not provide for modifications during its term. This Court sustained the propriety of the employer's action in discharging the employees. Here the strike occurred at a time when the parties were bargaining over modifications after notice and in accordance with the terms of the contract. Where there has been no express waiver of the right to strike,14 a waiver of the right during such a period is not to be inferred. We do not believe that the two-phase provision for terminating this contract means that it was not within the contemplation of the parties that economic weapons might be used to support demands for modification before the notice to terminate was given.
26
The judgment below is reversed and the case remanded for proceedings in conformity with this opinion.
27
Reversed and remanded.
28
Mr. Justice BRENNAN took no part in the consideration or decision of this case.
29
Mr. Justice FRANKFURTER, concurring in part and dissenting in part.
30
Agreeing as I do with the Court's construction of § 8(d) of the National Labor Relations Act, as amended, I join its opinion on that phase. But I do not think that the Court should now pass upon respondent's alternative defense of breach of contract, which the Court of Appeals did not reach because of its view of the statute. Perhaps that question is not open for judicial consideration. Section 10(e) of the Act provides that:
31
'No objection that has not been urged before the Board, its member, agent, or agency, shall be considered by the court, unless the failure or neglect to urge such objection shall be excused because of extraordinary circumstances.'1
32
The Board has not raised the point here, and it is not clear from the record that respondent urged this objection before the Board. In any event, it is not for this Court in the first instance to construe this particular contract. In remanding the case I would therefore leave it to the Court of Appeals to determine: (1) whether respondent has complied with § 10(e); (2) whether in this contract an agreement not to strike is reasonably to be implied; and (3) whether respondent continued its employment relationship with the strikers and should on that account be subject to the consequences of its alleged unfair labor practices even if the strike was in violation of contract. Finally, it is for the Court of Appeals to judge whether the record as a whole supports the Board's findings of unfair labor practices. Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 491, 71 S.Ct. 456, 466, 95 L.Ed. 456.
33
The inherent complications of the problem of statutory construction, as reflected in the conflicting views of the members of the Labor Board, make further discussion desirable, even though this may entail some repetition of what is said in the Court's opinion. Section 8(d) defines the duty of the employer and the union to bargain collectively. A long proviso in the section treats specifically of this duty where a collective-bargaining agreement is in effect. The proviso must be considered in its entirety:
34
'That where there is in effect a collective-bargaining contract covering employees in an industry affecting commerce, the duty to bargain collectively shall also mean that no party to such contract shall terminate or modify such contract, unless the party desiring such termination or modification—
35
'(1) serves a written notice upon the other party to the contract of the proposed termination or modification sixty days prior to the expiration date thereof, or in the event such contract contains no expiration date, sixty days prior to the time it is proposed to make such termination or modification;
36
'(2) offers to meet and confer with the other party for the purpose of negotiating a new contract or a contract containing the proposed modification;
37
'(3) notifies the Federal Mediation and Conciliation Service within thirty days after such notice of the existence of a dispute, and simultaneously therewith notifies any State or Territorial agency established to mediate and conciliate disputes within the State or Territory where the dispute occurred, provided no agreement has been reached by that time; and
38
'(4) continues in full force and effect, without resorting to strike or lock-out, all the terms and conditions of the existing contract for a period of sixty days after such notice is given or until the expiration date of such contract, whichever occurs later:
39
'The duties imposed upon employers, employees, and labor organizations by paragraphs (2), (3), and (4) shall become inapplicable upon an intervening certification of the Board, under which the labor organization or individual, which is a party to the contract, has been superseded as or ceased to be the representative of the employees subject to the provisions of section 9(a), and the duties so imposed shall not be construed as requiring either party to discuss or agree to any modification of the terms and conditions contained in a contract for a fixed period, if such modification is to become effective before such terms and conditions can be reopened under the provisions of the contract. Any employee who engages in a strike within the sixty-day period specified in this subsection shall lose his status as an employee of the employer engaged in the particular labor dispute, for the purposes of sections 8, 9, and 10 of this Act, as amended, but such loss of status for such employee shall terminate if and when he is reemployed by such employer.'
40
The reasoned efforts of the five members of the Board and the three Circuit Judges whose task it has been to apply this proviso to the problem before us—where an economic strike occurs prior to the contract's termination but pursuant to its reopening provisions and after sixty days' notice—have produced four distinct interpretations of the Act. The Court of Appeals, relying on its privious decision in Wilson & Co. v. National Labor Relations Board, 8 Cir., 210 F.2d 325, adopted respondent's contention that 'expiration date' means termination date and that § 8(d)(4) therefore bans all bargaining strikes throughout the life of a collective-bargaining contract. The Board majority held that 'expiration date' also comprehends 'an agreed date in the course of (the contract's) existence when the parties can effect changes in its provisions * * *' and that § 8(d) prohibits all strikes during the life of the contract except those in support of bargaining pursuant to a reopening clause. Member Peterson adhered to the Board's former interpretation, see Wilson & Co., 89 N.L.R.B. 310, that so long as the union gives notice of its desire to modify the contract sixty days before striking, § 8(d) does not prohibit a strike at any time during the life of the contract. Finally, Member Murdock argued that § 8(d) 'applies only to the period around the expiration date of a contract,' which he defined to mean its termination date, and that prior to that period a union may strike without any notice whatsoever.
41
Such diverse interpretations, particularly by the authorities charged with the administration of the Act, reflect not only the ambiguity of § 8(d)'s language but also the obscurity of its legislative history. The fact is that the Taft-Hartley Congress did not reveal its 'intention' regarding our present problem—the legality of economic strikes prior to the contract's ending. It has thus become a judicial responsibility to find that interpretation which can most fairly be said to be embedded in the statute, in the sense of being most harmonious with its scheme and with the general purposes that Congress manifested.
42
The construction placed upon the proviso by the Court of Appeals—that it bans strikes throughout the life of the contract, even at reopening—seems least tenable. Although expiration is a common synonym for termination, § 8(d) does not use the terms interchangeably. It speaks repeatedly of 'termination or modification,' while 'expiration' seems to embrace both events. Moreover, this section provides that it
43
'shall not be construed as requiring either party to discuss or agree to any modification of the terms and conditions contained in a contract for a fixed period, if such modification is to become effective before such terms and conditions can be reopened under the provisions of the contract.'
44
This implies an affirmative duty to bargain during reopening. It is not to be assumed that Congress provided such a duty and at the same time foreclosed a potential strike, a conventional factor in the collective-bargaining process.
45
The meaning given to 'expiration date' by the Court of Appeals would make § 8(d) achieve other anomalous results. For example, where there is in effect a two-year contract providing for reopening after one year, the party proposing modification at reopening would not be required by § 8(d)(1) to serve notice upon the other party until ten months after reopening had passed, and § 8(d)(3) would not require notice to mediating agencies until eleven months after reopening. Similarly, the loss-of-status sentence, which applies to employees who strike 'within the sixty-day period specified in this subsection * * *,' would punish only employees who strike ten months following reopening.
46
Nothing in § 8(d)'s legislative history warrants such a strained construction. To be sure, at one point in the Senate debate Senator Taft did say that 'If such (sixty days') notice is given, the bill provides for no waiting period except during the life of the contract itself.' But Senator Taft's attention was directed solely to strikes at termination, and this statement was intended merely to emphasize the point made in the following sentence that if notice is given less than sixty days prior to termination the waiting period extends beyond the life of the contract.2
47
Section 8(d)'s subsequent legislative history affords persuasive evidence that a reasonable interpretation of what the Taft-Hartley Congress legislated is that it allowed bargaining strikes at reopening if proceded by sixty days' notice. When, in 1948, the ambiguity in the statutory language was called to the attention of Congress, the Joint Committee on Labor-Management Relations, of which Senator Taft was a member, recommended a clarifying amendment in order to avoid the possibility that § 8(d) might be interpreted as either banning strikes at reopening or as permitting strikes prior to reopening. The Committee Report stated:
48
'In order that the parties may better know their rights in the matter, the committee recommends the adoption of the amendments which would permit a strike or a lock-out after a 60-day notice in support of demands they have anticipated in a reopening clause.' S.Rep.No. 986, 80th Cong., 2d Sess. 63 (1948).
49
In 1949, Senator Taft himself proposed such an amendment, S.Rep.No. 99, 81st Cong., 1st Sess. 27, 42 (1949), which was passed by the Senate, 95 Cong.Rec. 8717, but never became law.
50
At the opposite end of the statutory spectrum is Board Member Murdock's view that § 8(d) only bars strikes at termination, leaving unions free to strike without any notice whatsoever prior to the last sixty days of the contract. Ignoring the introductory paragraph of the proviso, which states: 'Where there is in effect a collective-bargaining contract * * * no party to such contract shall terminate or modify such contract, unless * * *,' Mr. Murdock urged that the rest of the proviso contemplates the situation 'around' the contract's 'expiration date,' which he defined as termination date. From this he inferred that § 8(d) only regulates conduct during this period.
51
If Mr. Murdock read 'expiration' to include reopening, his claim to have resolved § 8(d)'s logical inconsistencies would be more persuasive. The difficulty of his position is made manifest by the last part of the penultimate sentence of § 8(d), which clearly implies that the subsection applies to modifications under a reopening clause. The statement of Senator Ball, a leading proponent of § 8(d), that 'ours is a very mild provision, which merely says to unions, 'You must have a 60-day reopening clause in your contract',' 93 Cong.Rec. 7530, and § 8(d)'s subsequent legislative history, erase any doubt that it was intended to operate at least at reopening as well as at termination.
52
Even as thus revised the Murdock view is an artifact. It would permit a union, in an effort to force changes in its contract, to stop work without warning at any time except during the last sixty days of the period fixed by contract and to remain out for the length of the period short of its last sixty days. Yet Mr. Murdock mentioned no factors that would have made Congress so concerned about strikes at expiration as to lay down elaborate procedures applicable thereto and so unconcerned about strikes prior to the expiration period as to ignore them. The legislative history, on the other hand, makes clear that the dominant purpose of Congress in passing § 8(d) was one that is applicable to strikes at both times—to prevent the damaging effects of strikes without warning and to allow a cooling-off period during which differences might be discussed, mediated and resolved. See, e.g., 93 Cong.Rec. 3839, 5005, 5014. If anything, § 8(d)'s application would appear more necessary between expiration periods than during them, since the parties have by their contract warned each other of the possibility of work stoppage at the latter times.
53
It is significant also that the 1948 report of the Joint Committee on Labor-Management Relations, S.Rep.No.986, 80th Cong., 2d Sess. 62 (1948) which stated that § 8(d) was subject to three interpretations, did not mention Mr. Murdock's among them. Moreover, since the clarifying amendment proposed by the Committee was designed to preclude the possibility that § 8(d) might be construed to permit strikes at any time prior to reopening upon sixty days' notice, the Committee must have rejected, a fortiori, the possibility that § 8(d) permitted strikes at any time prior to reopening in the absence of such notice. The Murdock view was also rejected by the Board's General Counsel shortly after the Act's passage. He issued a complaint in the Wilson case, supra, even though the strike occurred more than nine months before the contract's reopening date. See 89 N.L.R.B. 310, 317, and S.Rep.No. 986, 80th Cong., 2d Sess. 62 (1948).
54
Mr. Murdock pointed out that the Senate Report on the Taft-Hartley bill stated, with respect to § 301, that a no-strike clause was something to be bargained for, S.Rep.No. 105, 80th Cong., 1st Sess. 17—18, and he reasoned that it would not have said this 'If it had been intended to remove no-strike provisions from the realm of collective bargaining * * *.' This argument would have force against an interpretation which actually does remove such provisions from bargaining. Section 8(d), however, has no effect on whether unions may validly strike over non-bargaining matters. See Mastro Plastics Corp. v. National Labor Relations Board, 350 U.S. 270, 76 S.Ct. 349. Nor does it render obsolete union pledges not to resort to bargaining strikes at reopening, if the present Board's interpretation is correct, or at any time after sixty days' notice, if the view of the former Board prevails. In any event, this statement from the Committee report on another section of the bill provides a flimsy basis for frustrating the oft-expressed legislative purpose of preventing 'quickie' strikes.
55
The question remains whether the old Board's interpretation is more persuasive than that of the present Board. The statutory language points toward the latter view—that § 8(d) not only proscribes strikes on less than sixty days' notice but also forbids strikes prior to reopening or termination. Section 8(d)(1) requires the party proposing a change in the contract to give sixty days' notice prior to 'expiration,' thereby implying that the proposed change will not take place until that time. Only in the event the contract contains no expiration date does this subsection provide for notice 'sixty days prior to the time it is proposed to make such termination or modification; * * *.' Section 8(d)(4) explicitly proscribes strikes 'for a period of sixty days after such notice (that provided for in (1)) is given or until the expiration date of such contract, whichever occurs later.' And the last part of § 8(d)'s penultimate sentence provides further evidence that Congress contemplated modification of the contract's terms only at reopening. The loss-of-status clause alone is more favorable to the former Board's view, since it speaks of 'the sixty-day period specified in this subsection,' and, to be effective under the present Board's construction, this clause has to be understood as reading 'the period specified in paragraph (4).' Since the problem before us was not anticipated, it is not surprising that § 8(d)'s legislative history offers little direct evidence that Congress did more than require a sixty-day waiting period prior to bargaining strikes. When the Joint Committee did note the problem in 1948, however, it adopted the present Board's view of the statute and not that of the old Board. The light which this subsequent history sheds on the ambiguity reinforces the present Board's construction as the more persuasive interpretation of § 8(d).
56
As the Court's opinion holds, since the union struck more than sixty days after giving notice of its desire to amend and in the course of negotiations pursuant to the contract's reopening clause, the Court of Appeals erred in setting aside the Board's order on the ground that the strike violated the waiting requirements of § 8(d).
57
Mr. Justice HARLAN, concurring in part and dissenting in part.
58
I join in so much of the Court's opinion as relates to the construction of § 8(d), agreeing with THE CHIEF JUSTICE'S reasoning and Mr. Justice FRANKFURTER'S further amplification of that problem. But I dissent from that part of the Court's opinion which dismisses respondent's breach of contract defense. That question was never passed on by the Court of Appeals, and I think that our remand should leave it open for the Court of Appeals to decide in the first instance. Further, I find the Court's opinion unclear as to whether the Court of Appeals is likewise foreclosed from now dealing with the sufficiency of the evidence as to the unfair labor practice charge against respondent a question which the Court of Appeals also did not reach because of its views on § 8(d)—and I think that question, too, should be left open for the Court of Appeals on remand.
59
This is the fourth time this Term that the Court has passed on questions which the court below never reached. See Mesarosh v. United States, 352 U.S. 1, 77 S.Ct. 1, 1 L.Ed.2d 1;1 Thompson v. Coastal Oil Co., 352 U.S. 862, 77 S.Ct. 90, 1 L.Ed.2d 73;2 Gibson v. Phillips Petroleum Co., 352 U.S. 874, 77 S.Ct. 16, 1 L.Ed.2d 77.3 I think this practice is an unfortunate one, depriving this Court, as it does, of the considered views of the lower courts. Its dangers are particularly apparent in the present case. As my brother FRANKFURTER points out, there is at least some question as to whether respondent ever raised its breach of contract defense before the National Labor Relations Board. And on the merits the question is an unusual one because of the atypical nature of this contract, and surely requires for its reliable adjudication much sharper consideration than it is possible for this Court to give it here as an original matter. Indeed, the nature of the question is such that the Court of Appeals might well conclude that the issue should be referred to the Board for its expert views in the first instance.
60
This kind of original adjudication by this Court is not what litigants have a right to expect. Moreover, to decide questions which, as here, have not been raised in the petition for certiorari offends our own rules.4 There will no doubt be cases where remand is not justified because the questions left open by the lower court are manifestly insubstantial. It seems to me that in such instances this Court should state that it is not remanding for that reason, instead of proceeding as a matter of course to decide the questions itself, either expressly or sub silentio. The latter procedure can only have a tendency to lead this Court, as here, to decide questions which it should not pass upon in the first instance, and in my opinion represents unsound judicial administration.
1
'Sec. 8. * * *
'(d) For the purposes of this section, to bargain collectively is the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment, or the negotiation of an agreement, or any question arising thereunder, and the execution of a written contract incorporating any agreement reached if requested by either party, but such obligation does not compel either party to agree to a proposal or require the making of a concession: Provided, That where there is in effect a collective-bargaining contract covering employees in an
industry affecting commerce, the duty to bargain collectively shall also mean that no party to such contract shall terminate or modify such contract, unless the party desiring such termination or modification—
'(1) serves a written notice upon the other party to the contract of the proposed termination or modification sixty days prior to the expiration date thereof, or in the event such contract contains no expiration date, sixty days prior to the time it is proposed to make such termination or modification;
'(2) offers to meet and confer with the other party for the purpose of negotiating a new contract or a contract containing the proposed modification;
'(3) notifies the Federal Mediation and Conciliation Service within thirty days after such notice of the existence of a dispute, and simultaneously therewith notifies any State or Territorial agency established to mediate and conciliate disputes within the State or Territory where the dispute occurred, provided no agreement has been reached by that time; and
'(4) continues in full force and effect, without resorting to strike or lock-out, all the terms and conditions of the existing contract for a period of sixty days after such notice is given or until the expiration date of such contract, whichever occurs later:
'The duties imposed upon employers, employees, and labor organizations by paragraphs (2), (3), and (4) shall become inapplicable upon an intervening certification of the Board, under which the labor organization or individual, which is a party to the contract, has been superseded as or ceased to be the representative of the employees subject to the provisions of section 9(a), and the duties so imposed shall not be construed as requiring either party to discuss or agree to any modification of the terms and conditions contained in a contract for a fixed period, if such modification is to become effective before such terms and conditions can be reopened under the provisions of the contract. Any employee who engages in a strike within the sixty-day period specified in this subsection shall lose his status as an employee of the employer engaged in the particular labor dispute, for the purposes of sections 8, 9, and 10 of this Act, as amended, but such loss of status for such employee shall terminate if and when he is reemployed by such employer.' 61 Stat. 140, 142—143, 29 U.S.C. § 158(d), 29 U.S.C.A. § 158(d).
2
BNA, Collective Bargaining Negotiations and Contract Service, 36:301.
3
Copies of the notice were sent to the Federal Mediation and Conciliation Service and to the Arkansas Labor Commissioner to comply with § 8(d)(2).
4
The only other case in the Courts of Appeals involving the question presented here is Local No. 3, United Packinghouse Workers etc. v. National Labor Relations Board, 8 Cir., 210 F.2d 325, certiorari denied 348 U.S. 822, 75 S.Ct. 36, 99 L.Ed. 648, also decided by the Eighth Circuit. The court there construed § 8(d)(4) as it did here, although on its facts the decision is reconcilable with the Board's construction of the section in this case.
5
Joint Committee on Labor-Management Relations, Final Report, S.Rep. No. 986, Pt. 3, 80th Cong., 2d Sess. 62—63.
6
The Board's original view in Wilson & Co., 89 N.L.R.B. 310, was that § 8(d) permitted strikes in support of contract changes any time after 60 days' notice. Member Peterson, concurring specially in the present case, adhered to that view. Member Murdock dissented on the same ground on which he had concurred specially in Wilson & Co., nemely, that § 8(d) applies only during the period around the termination of a contract.
7
Cf. § 13 of the Act: 'Nothing in this Act, except as specifically provided for herein, shall be construed so as either to interfere with or impede or diminish in any way the right to strike, or to affect the limitations or qualifications on that right.' 61 Stat. 151, 29 U.S.C. § 163, 29 U.S.C.A. § 163.
8
H.R.Conf.Rep. No. 510, 80th Cong., 1st Sess. 35.
9
Subcommittee on Labor and Labor-Management Relations, Factors in Successful Collective Bargaining, S.Rep. under S.Res. 71, 82d Cong., 1st Sess. 7 (Committee Print).
10
S.Rep. No. 986, Pt. 3, 80th Cong., 2d Sess. 62. In 1949 Senator Taft, who was a member of the Joint Committee, introduced a clarifying amendment to § 8(d). See S.Rep. No. 99, Pt. 2, 81st Cong., 1st Sess. 42 (minority report). The amendment, along with a group of others, passed the Senate, 95 Cong.Rec. 8717, but did not become law.
11
See S.Rep. No. 105, 80th Cong., 1st Sess. 24; id., Pt. 2, pp. 21—22; H.R.Conf.Rep. No. 510, 80th Cong., 1st Sess. 34—35. See also 93 Cong.Rec. 3835, 3839, 4036, 4904—4905, 5005, 5014, 6385, 6389, 6444, 6503—6504, 7530.
12
The minority members of the Senate Committee which reported out the bill containing § 8(d) did say that the effect of it was to incorporate no-strike clauses into labor contracts 'by legislative fiat.' The context, however, makes it tolerably clear that they were referring to a ban on strikes during the 60-day notice period. S.Rep. No. 105, Pt. 2, 80th Cong., 1st Sess. 22.
13
Section 8(d) originated in the Senate. The Committee said, 'It should be noted that this section (§ 8(d)) does not render inoperative the obligation to conform to notice provisions for longer periods, if the collective agreement so provides. Failure to give such notice, however, does not become an unfair labor practice if the 60-day provision is complied with.' S.Rep. No. 105, 80th Cong., 1st Sess. 24.
14
A no-strike clause was one of the company's demands during the negotiations in this case.
1
Section 10(f) specifies that this rule shall apply where judicial review of a Board order is obtained by an aggrieved person.
2
Senator Taft's full statement was:
'We have provided in the revision of the collective-bargaining procedure, in connection with the mediation process, that before the end of any contract, whether it contains such a provision or not, either party who wishes to open the contract may give 60 days' notice in order to afford time for free collective bargaining, and then for the intervention of the Mediation Service. If such notice is given, the bill provides for no waiting period except during the life of the contract itself. If, however, either party neglects to give such notice and waits, let us say, until 30 days before the end of the contract to give the notice, then there is a waiting period provided during which the strike is an unlawful labor practice for 60 days from that time, or to the end of the contract and 30 days beyond that time. In that case there is a so-called waiting period during which a strike is illegal, but it is only brought about by the failure of the union itself to give the notice which the bill requires shall be given. So it seems to me to be no real limitation of the rights of labor unions.' 93 Cong.Rec. 3839.
1
This Court granted the defendants a new trial on the ground that their conviction was tainted by prosecution evidence suspected to be perjurious. Neither the trial court nor the Court of Appeals had passed on this question, and there had been no investigation as to the reliability of the testimony or its precise bearing on the case.
2
The Court of Appeals, 3 Cir., 221 F.2d 559, reversed a judgment for the plaintiff in an unseaworthiness case on the ground that plaintiff had signed a valid release. D.C., 119 F.Supp. 838. This Court reversed, holding the release invalid, and reinstated the judgment of the District Court. The Court of Appeals therefore never had an opportunity to pass on the other points raised by the defendant on its appeal, mainly the question whether there was sufficient evidence for the finding that the vessel was unseaworthy.
3
The Court of Appeals, 5 Cir., 232 F.2d 13, had held that as a matter of Texas law plaintiff was barred from recovery by his own contributory negligence. This Court reversed and reinstated the judgment of the District Court. Again, the Court of Appeals had no opportunity to pass on alleged errors of the trial court in instructing the jury, that court not having reached those questions on the initial appeal.
4
Rule 23, subd. 1(c), Revised Rules, 28 U.S.C.A.
| 67
|
352 U.S. 306
77 S.Ct. 343
1 L.Ed.2d 347
The UNITED STATES, Petitioner,v.The ALLEN-BRADLEY COMPANY.
No. 78.
Argued Dec. 13, 1956.
Decided Jan. 22, 1957.
Mr. Hilbert P. Zarky, Washington, D.C., for the petitioner.
Mr. Harvey W. Peters, Milwaukee, Wis., for the respondent.
Mr. Justice BLACK delivered the opinion of the Court.
1
In 1940 this country embarked on the greatest program of defense preparedness in its history. Such an undertaking called for a vast expansion of the nation's industrial capacity. New and improved facilities were desperately needed, not only for the production of guns, planes and the other obvious weapons of war, but also for the innumerable items that are essential to the prosecution of large-scale conflict. This unprecedented program of expansion demanded the full and immediate cooperation of everyone who could lend assistance. While the Government attempted to secure the necessary facilities by building them itself or by extending emergency construction loans to private business, it soon appeared that these methods would not be adequate to meet the needs of defense. Private capital was called on for assistance in the task. However business exhibited a reluctance to build new war plants because of widespread fears that such facilities would become wholly useless when the emergency had passed. In response to these fears, Congress acted to lessen the financial risks involved in the private construction of emergency facilities. Among other things it amended the 1939 Internal Revenue Code by adding §§ 23(t) and 124,1 which allowed business to write off the cost of new facilities as a deduction against taxable income within a period of five years or less, regardless of the actual economic life of the facilities, provided they had been certified by the proper executive agency as 'necessary in the interest of national defense.' This accelerated amortization privilege generally enabled those businesses receiving it to reduce their federal income taxes with the net result that a large part of the construction costs was, at least temporarily, borne by the Federal Government through a reduction in its tax receipts.
2
This case involves a question of the proper interpretation of § 124(f), a vital part of these accelerated amortization provisions. The essential facts are not in dispute. During the Second World War the respondent Allen-Bradley Company produced radio parts and other materials needed by the Government to carry on the war. These products were in critically short supply and at the request of government procurement officers respondent repeatedly increased and improved its facilities in order to boost its output. In connection with such expansions it applied to the War Production Board, which was then the certifying authority, for certificates that the improvements were necessary to the national defense. The Board issued nine different certificates of necessity to respondent but the dispute here involves only three of these certificates. Each of these three stated that the facilities covered by it were necessary in the interest of national defense but only up to a specified percentage of their total cost. This 'partial certification' was made pursuant to a policy adopted by the Board in 1943 that it would certify essential facilities, which could reasonably be expected to have peacetime utility, only to the extent that their costs were attributable to the wartime increase in prices. Respondent accepted these partial certifications, proceeded with the expansion and in its tax returns for 1944 and 1945 deducted an amount based on the accelerated amortization of that part of the total cost which had been certified by the Board.
3
In 1953 respondent first raised the claim which is the basis of this suit that the Board had no authority to certify only part of the cost of a necessary emergency facility. Respondent concedes that the Board had discretion to refuse to issue any certificate at all, but contends that once it decided that a facility was necessary to the national defense its function was at an end and that any attempt by it to limit the certification to a part of the cost of such facility was a nullity. Therefore, respondent contends, it was entitled to accelerate the amortization of the full cost of those facilities covered by the three partial certificates and not just that part of the full cost which had been certified by the Board. On the basis of these contentions respondent filed the present action in the Court of Claims to recover an alleged overpayment of its 1944 and 1945 income taxes. The Court of Claims accepted respondent's arguments and rendered judgment for it. 134 Ct.Cl. 800. We granted certiorari, 351 U.S. 981, 76 S.Ct. 1049, because of the conflict between this decision and that of the Court of Appeals for the Second Circuit in Commissioner of Internal Revenue v. National Lead Co., 2 Cir., 230 F.2d 161.
4
The language of the crucial section 124(f) is ambiguous. It specifies that in determining the amount of the wartime construction costs which are to be available for the special amortization privilege:
5
'(1) There shall be included only so much of the amount * * * as is properly attributable to such construction * * * after December 31, 1939, as (the War Production Board) has certified as necessary in the interest of national defense during the emergency period * * *.'
6
Respondent argues that the phrase 'only so much of the amount' in this section refers simply to that part of the cost of facilities that is attributable to construction after 1939. On the other hand the Government contends that this qualifying phrase refers not only to those costs incurred after 1939, but also to that portion of those costs which the War Production Board has certified is necessary to the national defense. We believe that either interpretation is possible; that neither is compelled. But those who were responsible for the administration of the Act consistently interpreted § 124(f) as authorizing them to certify that only a part of the costs of construction after 1939 was necessary to the national defense.2
7
The legislative history shows that Congress intended that the administrators of the certification program were to have broad discretion in exercising their power. These administrators were faced with extremely complicated problems in attempting to accomplish the desired objective of Congress in the face of constant and drastic changes in conditions. And as the nation's industrial capacity became more adequate they carefully balanced the need for the proposed expansion against the loss of revenue to the Government caused by accelerated amortization before issuing a certificate. The power to certify only a portion of the cost gave them a more flexible instrument to balance these conflicting objectives.
8
It appears that Congress kept close supervision over the certification program and the special amortization privilege. For example, § 124 was amended five times during the war;3 two of these amendments altered § 124(f) itself in a manner which did not affect the language decisive of the present controversy. But no attempt was made to restrain the administrators from issuing certificates covering only a part of the cost of necessary facilities, although it seems apparent that responsible committees of Congress were aware that § 124(f) had been consistently interpreted and applied by the certifying authorities as permitting them to issue such certifications. In fact a special Senate 'watch-dog' committee was established to continually study and investigate the program for construction of war plants and facilities including the '* * * benefits accruing to contractors with respect to amortization for the purposes of taxation or otherwise * * *.'4
9
Perhaps § 124(f) could have been construed differently. But it was not. Construed as it was, it served its purpose. It contributed materially to the phenomenal expansion of our industrial plants which was so necessary for successful prosecution of the war. Certificates issued for only a portion of the cost of necessary facilities were accepted by business in general, and respondent in particular—apparently without substantial objection. The technique employed in § 124(f) was a new one and those who drafted that section could not be certain how it would work in practice. They could not foresee the many problems that would arise in the administration of this sweeping power which could be used to encourage expansion of any industry producing materials useful in the all-out war effort. Therefore it is not strange that the provision was loosely drawn and, in some respects, imprecise. However it would have been strange in these circumstances if Congress had embarked on this new course without leaving wide discretion for flexible administration in the light of the day-to-day grind of experience. The language of § 124(f) lends itself to such flexibility.
10
We hold that the Board had authority under § 124(f) to issue certificates, as in this case, certifying that only a part of the cost of essential wartime improvements was necessary to the national defense. Therefore, the judgment of the Court of Claims must be reversed. It is so ordered.
11
Reversed.
12
Mr. Justice HARLAN, concurring.
13
Both the terms of the statute, and the fact that two courts of such special expertise in tax matters as the Tax Court and Court of Claims have sustained the taxpayer's position,1 leave me doubtful as to whether, under the statutory provisions in question,2 the War Production Board had the right to issue partial certificates. The Court finds ambiguity in the statute, but, in resolving that ambiguity as it has, does little more than point out that Congress did not interfere with the authority claimed by the Board.
14
However, in my view the scope of the Board's powers need not be reached in this case, because, for the reasons given by Judge Lumbard in his opinion for the unanimous Court of Appeals in Commissioner of Internal Revenue v. National Lead Co., 2 Cir., 230 F.2d 161, I think it clear that respondent cannot maintain the present action. On that basis I join in the Court's decision.
1
54 Stat. 998—1003, as amended, 26 U.S.C. §§ 23(t), 124, 26 U.S.C.A. §§ 23(t), 124.
2
See War Department Regulations, Issuance of Necessity Certificates, 7 Fed.Reg. 4233 (1942); War Production Board Regulations, Issuance of Necessity Certificates, 8 Fed.Reg. 16964 (1943). And compare Treas.Reg. 111, § 29.124—6.
3
55 Stat. 4, 55 Stat. 757, 56 Stat. 50, 56 Stat. 850 and 59 Stat. 525.
4
S.Res. 71, 77th Cong., 1st Sess. (87 Cong.Rec. 1615), and S.Res. 6, 78th Cong., 1st Sess. (89 Cong.Rec. 331).
1
National Lead Co. v. Commissioner of Internal Revenue, 23 T.C. 988; Allen-Bradley Co. v. United States, 134 Ct.Cl. 800.
2
26 U.S.C. § 124(f)(1), 26 U.S.C.A. § 124(f)(1), from which the Court quotes, must be read in context with 26 U.S.C. §§ 124(e)(1) and 124(f)(3), 26 U.S.C.A. § 124(e)(1), (f)(3). Together these sections provide:
§ 124(e)(1). 'As used in this section, the term 'emergency facility' means any facility, land, building, machinery, or equipment, or part thereof, the construction, reconstruction, erection, installation, or acquisition of which was completed after December 31, 1939, and with respect to which a certificate under subsection (f) has been made * * *.'
§ 124(f). 'In determining, for the purposes of subsection (a) * * * the adjusted basis of an emergency facility—
'(1) There shall be included only so much of the amount otherwise constituting such adjusted basis as is properly attributable to such construction, reconstruction, erection, installation, or acquisition after December 31, 1939, as either the Secretary of War or the Secretary of the Navy has certified as necessary in the interest of national defense during the emergency period, which certification shall be under such regulations as may be prescribed from time to time by the Secretary of War and the Secretary of the Navy, with the approval of the President.'
§ 124(f)(3). '* * * In no event and notwithstanding any of the other provisions of this section, no amortization deduction shall be allowed in respect of any emergency facility for any taxable year—
'(C) unless a certificate in respect thereof under paragraph (1) shall have been made (i) prior to the filing of the taxpayer's return for such taxable year, or prior to the making of an election * * * to take the amortization deduction, or (ii) before December 1, 1941, whichever is later * * *.'
On December 17, 1943, the powers under these sections were transferred by the President to the War Production Board.
| 1112
|
352 U.S. 313
77 S.Ct. 347
1 L.Ed.2d 352
NATIONAL LEAD COMPANY, Petitioner,v.COMMISSIONER OF INTERNAL REVENUE.
No. 124.
Argued Dec. 13, 1956.
Decided Jan. 22, 1957.
Mr. Karl Riemer, Washington, D.C., for the petitioner.
Mr. Hilbert P. Zarky, Washington, D.C., for the respondent.
Mr. Justice BLACK delivered the opinion of the Court.
1
This is a companion case to United States v. Allen-Bradley Company, 352 U.S. 306, 77 S.Ct. 343, which was also decided today. During World War II petitioner manufactured engine bearings. In 1944 petitioner expanded its plant in an effort to increase the output of these essential war products. At the same time it applied to the War Production Board for certification that the various additions were necessary in the interest of national defense. However the Board, as in Allen-Bradley, granted certificates of necessity for only a part of the cost of petitioner's new facilities. In its income tax return for 1944 petitioner exercised the privilege such certification conferred by taking as a deduction a sum based on the accelerated amortization of that part of the costs which had been certified by the Board.
2
In 1951 the Commissioner of Internal Revenue asserted a deficiency against petitioner on grounds unrelated to the present controversy. Petitioner subsequently filed a petition for redetermination with the Tax Court claiming that it was entitled to a refund for overpayment of income taxes in 1944. The amount of this overpayment was calculated on the basis that petitioner was entitled to accelerate the amortization of the full cost of those facilities covered by the Board's 'partial certifications.' Petitioner contends that the Board was not authorized to certify only a part of the cost of a facility when the Board had determined that the facility as a whole was necessary to the national defense. The Tax Court granted petitioner's claim, but on appeal the Second Circuit reversed, holding that petitioner had forfeited its right to challenge the Board's action by waiting too long after accepting the tax benefits of the 'partial certificates' to attack their validity. 2 Cir., 230 F.2d 161. The Court of Appeals did not reach the question whether the Board was authorized to issue such 'partial certificates.' For reasons stated in our opinion in United States v. Allen-Bradley Company, 352 U.S. 306, 77 S.Ct. 343, we hold that the Board was empowered to issue certificates covering only a part of the cost of petitioner's improvements. Accordingly, we affirm the judgment of the Court of Appeals.
3
Affirmed.
4
Mr. Justice HARLAN joins in the Court's decision for the reasons stated in his concurring opinion in United States v. Allen-Bradley Company, 352 U.S. 306, 77 S.Ct. 343.
| 1112
|
352 U.S. 315
77 S.Ct. 374
1 L.Ed.2d 354
RAYONIER INCORPORATED, a Corporation, Petitioner,v.UNITED STATES of America. Arthur A. ARNHOLD et al., Petitioners, v. UNITED STATES of America.
Nos. 45, 47.
Argued Dec. 4, 1956.
Decided Jan. 28, 1957.
Mr. Lucien F. Marion, Seattle, Wash., for petitioner Rayonier inc.
Mr. William H. Ferguson, Seattle, Wash., for petitioners Arnhold and others.
Mr. George Cochran Doub, Washington, D.C., for the United States.
Mr. Justice BLACK delivered the opinion of the Court.
1
In both of these cases petitioners brought suit in the United States District Court in the State of Washington seeking to recover damages under the Federal Tort Claims Act, 28 U.S.C. §§ 1346(b) and 2671—2680, 28 U.S.C.A. §§ 1346(b), 2671—2680, for losses which they allege were caused by the negligence of employees of the United States in allowing a forest fire to be started on Government land and in failing to act with due care to put this fire out. The complaints in the two cases are substantially the same and in summary make the following allegations. The United States owned certain land in the State of Washington. It permitted a railroad to run trains over a right of way passing through this land. On August 6, 1951, sparks from a railroad engine ignited six fires on the right of way and adjoining land. These fires started in areas where highly inflammable dry grasses, brush, and other materials had been negligently allowed to accumulate by the Government. Shortly after the fires started United States Forest Service personnel appeared and took exclusive direction and control of all fire suppression activities. The Forest Service had entered into an agreement with the State of Washington to protect against and to suppress any fires in an area which included the public lands where these fires started and the petitioners' lands. Petitioners were aware of this contract and relied on the Forest Service to control and put out the fires involved in this case. But as a result of the Forest Service's improper firefighting these fires spread until they became a single fire covering 1,600 acres. By August 11, however, this blaze was under control and was substantially out except for certain spots that continued to burn and smolder until September 20. During the period between August 11 and September 20 there were men, equipment and a plentiful supply of water available to the Forest Service and if these resources had been properly utilized the fire could have been completely extinguished. For several days immediately preceding September 20 there was decreasing humidity accompanied by strong winds. But the Forest Service kept only a few men guarding the fire despite the fact that it was smoldering close to a tinder-dry accumulation of debris, down logs and dead undergrowth. On September 20 the winds blew sparks from the smoldering embers into these inflammable materials and the fire exploded spreading as much as twenty miles in one direction. As it fanned out it destroyed timber, buildings and other property some of which belonged to the petitioners.
2
The complaints allege that these consequences were caused by the Forest Service's negligence (1) in permitting inflammable materials to accumulate on Government land thereby allowing the fires to start and to spread; (2) in not preventing the railroad from starting the original spot fires; (3) in not properly suppressing the spot fires; and (4) in failing to quench and prevent the spread of the fire when it was under control in the 1,600 acre area. The district judge dismissed the complaints holding that they failed to state a claim upon which relief could be granted. He indicated that the facts alleged were sufficient to show actionable negligence on the part of a private person under the laws of Washington, but nevertheless felt compelled to dismiss the complaints because of the following statements by this Court in Dalehite v. United States, 346 U.S. 15, 43, 73 S.Ct. 956, 972, 97 L.Ed. 1427.
3
'As to the alleged failure in fighting the fire, we think this too without the (Tort Claims) Act. The Act did not create new causes of action where none existed before. '* * * Its effect is to waive immunity from recognized causes of action and was not to visit the Government with novel and unprecedented liabilities.' * * * It did not change the normal rule that an alleged failure or carelessness of public firemen does not create private actionable rights.'
4
The Court of Appeals affirmed the trial judge's disposal of the complaints. 9 Cir., 225 F.2d 642 and 9 Cir., 225 F.2d 650. In agreeing that the United States could not be sued for any carelessness by the Forest Service in fighting the fire, it also relied exclusively on the Dalehite case. It rejected petitioners' other claims of negligence on the ground that Washington law would impose no liability for the misconduct alleged. We hold that the courts below erred in deciding that the United States was immune from liability for any negligence by the Forest Service in fighting the fire.
5
The Tort Claims Act makes the United States liable (with certain exceptions which are not relevant here) for the negligence of its employees
6
'* * * in the same manner and to the same extent as a private individual under like circumstances * * *.' 28 U.S.C. § 2674, 28 U.S.C.A. § 2674.
7
It gives the District Courts jurisdiction of all claims against the Government for losses
8
'* * * caused by the negligent or wrongful act or omission of any employee of the Government while acting within the scope of his office or employment, under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.' 28 U.S.C. § 1346(b), 28 U.S.C.A. § 1346(b).
9
These provisions, given their plain natural meaning, make the United States liable to petitioners for the Forest Service's negligence in fighting the forest fire if, as alleged in the complaints, Washington law would impose liability on private persons or corporations under similar circumstances.
10
Nevertheless the Government, relying primarily on the Dalehite case, contends that Congress by the Tort Claims Act did not waive the United States' immunity from liability for the negligence of its employees when they act as public firemen. It argues that the Act only imposes liability on the United States under circumstances where governmental bodies have traditionally been responsible for the misconduct of their employees and that neither the common law nor the law of Washington imposes liability on municipal or other local governments for the negligence of their agents acting in the 'uniquely governmental' capacity of public firemen. But as we recently held in Indian Towing Co. v. United States, 350 U.S. 61, 76 S.Ct. 122, the test established by the Tort Claims Act for determining the United States' liability is whether a private person would be responsible for similar negligence under the laws of the State where the acts occurred. We expressly decided in Indian Towing that the United States' liability is not restricted to the liability of a municipal corporation or other public body and that an injured party cannot be deprived of his rights under the Act by resort to an alleged distinction, imported from the law of municipal corporations, between the Government's negligence when it acts in a 'proprietary' capacity and its negligence when it acts in a 'uniquely governmental' capacity.1 To the extent that there was anything to the contrary in the Dalehite case it was necessarily rejected by Indian Towing.2
11
It may be that it is 'novel and unprecedented' to hold the United States accountable for the negligence of its fire-fighters, but the very purpose of the Tort Claims Act was to waive the Government's traditional all-encompassing immunity from tort actions and to establish novel and unprecedented governmental liability. The Government warns that if it is held responsible for the negligence of Forest Service firemen a heavy burden may be imposed on the public treasury. It points out the possibility that a fire may destroy hundreds of square miles of forests and even burn entire communities. But after long consideration, Congress, believing it to be in the best interest of the nation, saw fit to impose such liability on the United States in the Tort Claims Act. Congress was aware that when losses caused by such negligence are charged against the public treasury they are in effect spread among all those who contribute financially to the support of the Government and the resulting burden on each taxpayer is relatively slight. But when the entire burden falls on the injured party it may leave him destitute or grievously harmed. Congress could, and apparently did, decide that this would be unfair when the public as a whole benefits from the services performed by Government employees. And for obvious reasons the United States cannot be equated with a municipality, which conceivably might be rendered bankrupt if it were subject to liability for the negligence of its firemen. There is no justification for this Court to read exemptions into the Act beyond those provided by Congress.3 If the Act is to be altered that is a function for the same body that adopted it.
12
The record shows that the trial judge dismissed both complaints in their entirety solely on the basis of the Dalehite case. While the Court of Appeals relied on state law to uphold the dismissal of those allegations in the complaints which charged negligence for reasons other than the Forest Service's carelessness in controlling the fire, we cannot say that court's interpretation of Washington law was wholly free from its erroneous acceptance of the statements in Dalehite about public firemen. Furthermore it has been strongly contended here that the Court of Appeals improperly interpreted certain allegations in the complaints and as a result of such misinterpretation incorrectly applied Washington law in passing on the sufficiency of these allegations. In view of the circumstances, we think it proper to vacate both judgments in their entirety so that the District Court may consider the complaints anew, in their present form or as they may be amended, wholly free to determine their sufficiency on the basis of whether the allegations and any supporting material offered to explain or clarify them would be sufficient to impose liability on a private person under the laws of the State of Washington.4 The judgments of both courts are vacated and the cases are remanded to the District Court for consideration in accordance cordance with this opinion.
13
It is so ordered.
14
Judgments vacated and cases remanded.
15
Mr. Justice REED, with whom Mr. Justice CLARK joins, dissenting.
16
The Court of Appeals in my view correctly applied the law as to public fire fighters. Congress assumed liability 'as a private individual under like circumstances.' The immunity of public bodies for injuries due to fighting fire was then well settled. Dalehite v. United States, 346 U.S. 15, 43, 73 S.Ct. 956, 971, 97 L.Ed. 1427. Private organizations, except as community volunteers, for fire fighting were hardly known. The situation was like private military forces. Cf. Feres v. United States, 340 U.S. 135, 142, 71 S.Ct. 153, 157, 95 L.Ed. 152. Indian Towing Co. v. United States, 350 U.S. 61, 76 S.Ct. 122, presents a different situation.
1
And see United States v. Yellow Cab Co., 340 U.S. 543, 548 550, 71 S.Ct. 399, 403, 404, 95 L.Ed. 523.
2
See also Eastern Air Lines v. Union Trust Co., 95 U.S.App.D.C. 189, 221 F.2d 62, affirmed per curiam sub nom. United States v. Union Trust Co., 350 U.S. 907, 76 S.Ct. 192; Air Transport Associates v. United States, 9 Cir., 221 F.2d 467. Cf. United States v. Praylou, 4 Cir., 208 F.2d 291, 294—295.
3
See United States v. Aetna Casualty & Surety Co., 338 U.S. 366, 383, 70 S.Ct. 207, 216, 94 L.Ed. 171.
4
Cf. State of Minnesota v. National Tea Co., 309 U.S. 551, 555, 60 S.Ct. 676, 678, 84 L.Ed. 920; State Tax Commission of Utah v. Van Cott, 306 U.S. 511, 514—515, 59 S.Ct. 605, 606, 607, 83 L.Ed. 950; and Patterson v. State of Alabama, 294 U.S. 600, 607, 55 S.Ct. 575, 578, 79 L.Ed. 1082.
| 78
|
352 U.S. 985
77 S.Ct. 378
1 L.Ed.2d 360
Ben GOLD, Petitioner,v.UNITED STATES of America.
No. 137.
Argued Jan. 22 and 23, 1957.
Decided Jan. 28, 1957.
Messrs. Harold I. Cammer, New York City, and Joseph Forer, Washington, D.C., for the petitioner.
Mr. Joseph A. Lowther, Washington, D.C., for the respondent.
PER CURIAM.
1
The judgment is reversed and the case remanded to the District Court with directions to grant a new trial because of official intrusion into the privacy of the jury. Remmer v. United States, 350 U.S. 377, 76 S.Ct. 425; 347 U.S. 227, 74 S.Ct. 450, 98 L.Ed. 654. The fact that the intrusion was unintentional does not remove the effect of the intrusion.
2
Mr. Justice REED, with whom Mr. Justice BURTON and Mr. Justice CLARK join, dissenting.
3
The Remmer case, dealing with a Federal Bureau of Investigation inquiry into a suspected approach to a juror by a defendant, is not in our judgment controlling in this FBI inquiry of people who happened to be Gold jurors concerning a different Communist case. Compare the facts and conclusions of law in Remmer v. United States, 350 U.S. 377, 381, 382, 76 S.Ct. 425, 427, 428, and 347 U.S. 227, 74 S.Ct. 450, 98 L.Ed. 654, with the facts stated in Gold v. United States, 237 F.2d 764, 775.
4
While a presumption of prejudice arises when a juror in a criminal case receives a private communication bearing even remotely on the trial, the question in each such case is whether that presumption has been rebutted. Cf. Remmer v. United States, 347 U.S. 227, 229, 74 S.Ct. 450, 451, 98 L.Ed. 654, and Mattox v. United States, 146 U.S. 140, 149—150, 13 S.Ct. 50, 53, 36 L.Ed. 917.
5
We think the record showing of the jurors' reaction to the present inquiry, Record 1586—1673, adequately supports the trial judge's conclusion that no effect upon the jurors adverse to the defendant, because of the accidental intrusion upon their privacy, could reasonably be anticipated.
6
The juror and the alternate who felt disturbed by the incident were discharged. In our view this made it proper to go ahead, as the court did, with the trial.
7
Mr. Justice CLARK, dissenting.
8
While I too feel that the narrow ground of Remmer's case should not be used to bring about reversal here, I am also disturbed by the refusal of the Court to decide other important questions urged upon us by both parties and ready for disposition. Among these are the applicability of the perjury rule of evidence to the false statement statute, eligibility of government employees to serve as jurors, admissibility of evidence of prior activity in the Communist Party to disprove the sincerity of a resignation therefrom, the use of expert witnesses to prove continuing membership and the correctness of the court's charges as to membership in the Party, etc. It seems to me that proper judicial administration requires this Court to decide these important issues, particularly since they will again arise at the retrial. Furthermore, similar cases involving the same legal points are pending in various districts throughout the country. The refusal of the majority today to pass upon them thus deprives the federal judiciary of this Court's opinion, which renders today's error multifold. It will cause undue hardship in the trial of all of these cases, not only on the Government but on the defendants as well. I therefore dissent.
| 01
|
352 U.S. 330
77 S.Ct. 510
1 L.Ed.2d 376
Matter of the Petition for a Writ of Habeas Corpus for Harry A. GROBAN and Nathan Groban, Appellants.
No. 14.
Argued Nov. 6, 1956.
Decided Feb. 25, 1957.
Mr. James F. Graham, Zanesville, Ohio, for the appellants.
Messrs. Earl W. Allison, Jr. and J. Ralston Werum, Columbus, for the appellee.
Mr. Justice REED delivered the opinion of the Court.
1
The question presented by this appeal is whether appellants had a constitutional right under the Due Process Clause of the Fourteenth Amendment to the assistance of their own counsel in giving testimony as witnesses at a proceeding conducted by the Ohio State Fire Marshal to investigate the causes of a fire.
2
After a fire occurred on the premises of a corporation owned and operated by appellants, the Fire Marshal started an investigation into the causes of the fire and subpoenaed appellants to appear as witnesses. The Fire Marshal refused to permit appellants' counsel to be present at the proceeding, relying on § 3737.13 of the Ohio Code, which provides that the 'investigation * * * may be private' and that he may 'exclude from the place where (the) investigation is held all persons other than those required to be present * * *.'1 Appellants declined to be sworn and to testify without the immediate presence of their counsel, who had accompanied them to the hearing. Their refusal was treated as a violation of § 3737.12, which provides that 'No witness shall refuse to be sworn or refuse to testify * * *.' Section 3737.99(A) provides that 'Whoever violates section 3737.12 * * * may be summarily punished, by the officer concerned, by * * * commitment to the county jail until such person is willing to comply with the order of such officer.' The Fire Marshal accordingly committed appellants to the county jail until such time as they should be willing to testify.2 Appellants' application for a writ of habeas corpus was denied by the Ohio Court of Common Pleas, and this denial was affirmed on appeal by the Ohio Court of Appeals and by the Ohio Supreme Court.3
3
We postponed further consideration of the question of jurisdiction to the hearing on the merits. 351 U.S. 903, 76 S.Ct. 693, 100 L.Ed. 1440. The Ohio Supreme Court construed § 3737.13 to authorize the Fire Marshal to exclude appellants' counsel from the proceeding. Since appellants' attack is on the constitutionality of that section, we have jurisdiction on appeal. 28 U.S.C. § 1257(2), 28 U.S.C.A. § 1257(2).
4
We note at the outset that appellants explicitly disavow making any direct attack on the Fire Marshal's power of summary punishment under § 3737.99(A). They challenge not the validity of the procedure by which they were committed to jail, but the constitutional sufficiency of the grounds on which they were so committed. Their sole assertion is that the Fire Marshal's authority to exclude counsel under § 3737.13 was unconstitutional because they had a right, under the Due Process Clause, to the assistance of their counsel in giving their testimony.
5
It is clear that a defendant in a state criminal trial has an unqualified right, under the Due Process Clause, to be heard through his own counsel. Chandler v. Fretag, 348 U.S. 3, 75 S.Ct. 1, 99 L.Ed. 4. Prosecution of an individual differs widely from administrative investigation of incidents damaging to the economy or dangerous to the public. The proceeding before the Fire Marshal was not a criminal trial, nor was it an administrative proceeding that would in any way adjudicate appellants' responsibilities for the fire. It was a proceeding solely to elicit facts relating to the causes and circumstances of the fire. The Fire Marshal's duty was to 'determine whether the fire was the result of carelessness or design,' and to arrest any person against whom there was sufficient evidence on which to base a charge of arson.4
6
The fact that appellants were under a legal duty to speak and that their testimony might provide a basis for criminal charges against them does not mean that they had a constitutional right to the assistance of their counsel. Appellants here are witnesses from whom information was sought as to the cause of the fire. A witness before a grand jury cannot insist, as a matter of constitutional right, on being represented by his counsel,5 nor can a witness before other investigatory bodies.6 There is no more reason to allow the presence of counsel before a Fire Marshal trying in the public interest to determine the cause of a fire. Obviously in these situations evidence obtained may possibly lay a witness open to criminal charges. When such charges are made in a criminal proceeding, he then may demand the presence of his counsel for his defense. Until then his protection is the privilege against self-incrimination.7 U.S.Const., Amend. V.; Ohio Const., Art. I, § 10. See Adamson v. People of State of California, 332 U.S. 46, 52, 67 S.Ct. 1672, 1675, 91 L.Ed. 1903. This is a privilege available in investigations as well as in prosecutions. See In re Groban, 164 Ohio St. 26, 28, 128 N.E.2d 106, 108, and 99 Ohio App. 512, 515, 135 N.E.2d 477, 480; McCarthy v. Arndstein, 266 U.S. 34, 40, 45 S.Ct. 16, 17, 69 L.Ed. 158; Adams v. State of Maryland, 347 U.S. 179, 74 S.Ct. 442, 98 L.Ed. 608. We have no doubt that the privilege is available in Ohio against prosecutions as well as convictions reasonably feared. Cf. Ullmann v. United States, 350 U.S. 422, 431, 76 S.Ct. 497, 502, 100 L.Ed. 511. The mere fact that suspicion may be entertained of such a witness, as appellants believed existed here, though without allegation of facts to support such a belief, does not bar the taking of testimony in a private investigatory proceeding.
7
It may be that the number of people present in a grand jury proceeding gives greater assurance that improper use will not be made of the witness' presence. We think, however, that the presumption of fair and orderly conduct by the state officials without coercion or distortion exists until challenged by facts to the contrary. Possibility of improper exercise of opportunity to examine is not in our judgment a sound reason to set aside a State's procedure for fire prevention. As in similar situations, abuses may be corrected as they arise, for example, by excluding from subsequent prosecutions evidence improperly obtained.
8
Ohio, like many other States, maintains a division of the state government directed by the Fire Marshal for the prevention of fires and reduction of fire losses.8 Section 3737.13, which has been in effect since 1900,9 represents a determination by the Ohio Legislature that investigations conducted in private may be the most effective method of bringing to light facts concerning the origins of fires, and, in the long run, of reducing injuries and losses from fires caused by negligence or by design. We cannot say that this determination is unreasonable. The presence of advisors to witnesses might easily so far encumber an investigatory proceeding as to make it unworkable or unwieldy. And with so weighty a public interest as fire prevention to protect, we cannot hold that the balance has been set in such a way as to be contrary to 'fundamental principles of liberty and justice.' Hebert v. State of Louisiana, 272 U.S. 312, 316, 47 S.Ct. 103, 104, 71 L.Ed. 270. That is the test to measure the validity of a state statute under the Due Process Clause.
9
Appellants urge, however, that the Fire Marshal's power to exclude counsel under § 3737.13 must be considered in the light of his power of summary punishment under § 3737.99(A), and they would have us hold that, so considered, his power to exclude counsel was unconstitutional. We held in In re Oliver, 333 U.S. 257, 68 S.Ct. 499, 92 L.Ed. 682, that a witness before a one-man grand jury, a judge, could not constitutionally be punished summarily for contempt of the grand jury without being allowed to be represented by his counsel. We see no relation between the premise that appellants could not be punished without representation by counsel and the conclusion that they could not be questioned without such representation. Section 3737.13 may contain a constitutional flaw if it should be construed to authorize the exclusion of counsel while the Fire Marshal determines that a witness has violated § 3737.12 and orders the witness committed. The sole assertion of a constitutional violation that appellants relied upon before the Ohio Supreme Court and the only one open on the record here—the authorization in § 3737.13 of the exclusion of counsel while a witness testifies—is not well founded. We hold that appellants had no constitutional right to be assisted by their counsel in giving testimony at the investigatory proceeding conducted by the Fire Marshal, and that § 3737.13, insofar as it authorizes the exclusion of counsel while a witness testifies, is not repugnant to the Due Process Clause of the Fourteenth Amendment.
10
Affirmed.
11
Mr. Justice FRANKFURTER, whom Mr. Justice HARLAN joins, concurring.
12
To whatever extent history may confirm Lord Acton's dictum that power tends to corrupt, such a doctrine of fear can hardly serve as a test, under the Due Process Clause of the Fourteenth Amendment, of a particular exercise of a State's legislative power. And so, the constitutionality of a particular statute, expressive of a State's view of desirable policy for dealing with one of the rudimentary concerns of society—the prevention of fires and the ascertainment of their causes—and directed towards a particular situation, cannot be determined by deriving a troupe of hobgoblins from the assumption that such a particularized exercise of power would justify an unlimited, abusive exercise of power.
13
If the Ohio legislation were directed explicitly or by obvious design toward secret inquisition of those suspected of arson, we would have a wholly different situation from the one before us. This is not a statute directed to the examination of suspects. It is a statute authorizing inquiry by the chief guardian of a community against the hazards of fire into the causes of fires. To be sure, it does not preclude the possibility that a suspect might turn up among those to be questioned by the Fire Marshal. But the aim of the statute is the expeditious and expert ascertainment of the causes of fire. The Fire Marshal is not a prosecutor, though he may, like others, serve as a witness for the prosecution. In various proceedings, as for instance under some workmen's compensation laws, the presence of lawyers is deemed not conducive to the economical and thorough ascertainment of the facts. The utmost devotion to one's profession and the fullest recognition of the great role of lawyers in the evolution of a free society cannot lead one to erect as a constitutional principle that no administrative inquiry can be had in camera unless a lawyer be allowed to attend.
14
The assumption that as a normal matter such an inquiry carries with it deprivation of some rights of a citizen assumes inevitable misuse of authority. For good reasons, and certainly for constitutional purposes, the contrary assumption must be entertained. The potential danger most feared is that it will invade the privilege against self-incrimination in States where it is constitutionally recognized. But that privilege is amply safeguarded by the decision of the Supreme Court of Ohio in this case. We are not justified in invalidating this Ohio statute on the assumption that people called before the Fire Marshal would not be aware of their privilege not to respond to questions the answers to which may tend to incriminate. At a time when this privilege has attained the familiarity of the comic strips, the assumption of ignorance about the privilege by witnesses called before the Fire Marshal is too farfetched an assumption on which to invalidate legislation.
15
What has been said disposes of the suggestion that, because this statute relating to a general administrative, non-prosecutorial inquiry into the causes of fire is sustained, it would follow that secret inquisitorial powers given to a District Attorney would also have to be sustained. The Due Process Clause does not disregard vital differences. If it be said that these are all differences of degree, the decisive answer is that recognition of differences of degree is inherent in due regard for due process. We are admonished from time to time not to adjudicate on the basis of fear of foreign totalitarianism. Equally so should we not be guided in the exercise of our reviewing power over legislation by fear of totalitarianism in our own country.
16
For these reasons I join the opinion of the Court.
17
Mr. Justice BLACK, with whom The CHIEF JUSTICE, Mr. Justice DOUGLAS and Mr. Justice BRENNAN join, dissenting.
18
I believe that it violates the protections guaranteed every person by the Due Process Clause of the Fourteenth Amendment for a state to compel a person to appear alone before any law-enforcement officer and give testimony in secret against his will. Under the reasoning of the majority every state and federal law-enforcement officer in this country could constitutionally be given power to conduct such secret compulsory examinations. This would be a complete departure from our traditional methods of law enforcement and would go a long way toward placing 'the liberty of every man in the hands of every petty officer.'1 By sanctioning the Ohio statutes involved here the majority disregards 'this nation's historic distrust of secret proceedings'2 and decides contrary to the general principle laid down by this Court in one of its landmark decisions that an accused '* * * requires the guiding hand of counsel at every step in the proceedings against him.'3
19
The Ohio statutes give the state Fire Marshal and his deputies broad power to investigate the cause of fires. These officers can summon any person to appear before one or more of them to testify under oath.4 They can punish him summarily for contempt if he refuses to answer their questions or if he disobeys any of their orders.5 They can exclude any person they wish from the examination, including the witness' counsel.6 After the questioning the Marshal or his deputy can arrest the witness if he believes that there is evidence sufficient to charge him with arson or a similar crime.7 Any statements taken from the suspect during these secret sessions must be turned over to the Prosecuting Attorney for use in any subsequent prosecution.8 An 'Arson Bureau' is established in the Fire Marshal's office and it is provided with a staff charged with the duty of investigating fires to determine if a crime has been committed. The Fire Marshal and his deputy in charge of the 'Arson Bureau' are expressly made '* * * responsible * * * for the prosecution of persons believed to be guilty of arson or a similar crime.'9 The statutory provisions show that the Fire Marshal and his deputies are given the ordinary duties of policemen with respect to 'arson and similar crimes.'
20
After appellants' place of business at Dresden, Ohio, burned down, a deputy fire marshal summoned appellants to appear before him with their business records to answer questions about the fire. According to their unchallenged affidavit, the Fire Marshal believed that they had started the fire. Appellants appeared before the deputy with their lawyer, stating that they were willing to testify fully but only if they could have their counsel present during the interrogation. The deputy informed them that the interrogation would be held in private and refused to admit their lawyer. Under these conditions they refused to testify. The deputy proceeded to hold them in contempt and ordered them imprisoned until they were willing to testify before him in secret. Appellants' counsel was not present at the time they refused to testify nor when they were adjudged in contempt and ordered imprisoned.
21
Appellants instituted this action for a writ of habeas corpus in a state court of Ohio contending that their imprisonment would be contrary to the Fourteenth Amendment. The Ohio Supreme Court rejected this contention and affirmed the judgments of lower state courts refusing to issue the writ. This Court upholds the decision below, but even on the narrow grounds upon which it chooses to decide the case I think that its holding is erroneous and constitutes a very dangerous precedent.10 I believe that the judgments below should be reversed because it is contrary to due process of law to imprison appellants for refusing to testify before the Deputy Fire Marshal in secret.
22
A secret examination such as the deputy proposed to conduct is fraught with dangers of the highest degree to a witness who may be prosecuted on charges related to or resulting from his interrogation. Under the law of Ohio it seems clear that any statement allegedly secured from the witness may be used as evidence against him at a preliminary examination to justify his detention, before a grand jury to secure his indictment, and at the formal trial to obtain his conviction.11 The witness has no effective way to challenge his interrogator's testimony as to what was said and done at the secret inquisition. The officer's version frequently may reflect an inaccurate understanding of an accused's statements or, on occasion, may be deliberately distorted or falsified. While the accused may protest against these misrepresentations, his protestations will normally be in vain. This is particularly true when the officer is accompanied by several of his assistants and they all vouch for his story.12 But when the public, or even the suspect's counsel, is present the hazards to the suspect from the officer's misunderstanding or twisting of his statements or conduct are greatly reduced.13
23
The presence of legal counsel or any person who is not an executive officer bent on enforcing the law provides still another protection to the witness. Behind closed doors he can be coerced, tricked or confused by officers into making statements which may be untrue or may hide the truth by creating misleading impressions. While the witness is in the custody of the interrogators, as a practical matter, he is subject to their uncontrolled will. Here it should be pointed out that the Ohio law places no restrictions on where the interrogations can be held or their duration. Exemplifying the abuses which may occur in secret proceedings, this Court has repeatedly had before it cases where confessions have been obtained from suspects by coercive interrogation in secret.14 While the circumstances in each of these cases have varied, in all of them, as well as in many others, the common element has been the suspect's interrogation by officers while he was held incommunicado without the presence of his counsel, his friends or relatives, or the public. As was said in a concurring opinion in Haley v. State of Ohio, 332 U.S. 596, at page 605, 68 S.Ct. 302, at page 306, 92 L.Ed. 224: 'An impressive series of cases in this and other courts admonishes of the temptations to abuse of police endeavors to secure confessions from suspects, through protracted questioning carried on in secrecy, with the inevitable disquietude and fears police interrogations naturally engender in individuals questioned while held incommunicado, without the aid of counsel and unprotected by the safeguards of a judicial inquiry.'15 Nothing would be better calculated to prevent misuse of official power in dealing with a witness or suspect than the scrutiny of his lawyer or friends or even of disinterested bystanders.16
24
A witness charged with committing contempt during the secret interrogation faces the gravest handicaps in defending against this charge. The interrogating officers may assert that he engaged in certain contumacious behavior before them and seek to imprison him. Even when the charges are tried by someone other than his interrogators,17 the accused's efforts to show that the actual events were not as pictured by the interrogating officers would normally be futile if he could call on no one to corroborate his testimony. And when a witness is deprived of the advice of counsel he may be completely unaware that his conduct has crossed the obscure boundary and become contemptuous. Moreover, executive officers will be somewhat more chary in exercising the dangerous contempt power if their actions are subject to external scrutiny.
25
I also firmly believe that the Due Process Clause requires that a person interrogated be allowed to use legal counsel whenever he is compelled to give testimony to law-enforcement officers which may be instrumental in his prosecution and conviction for a criminal offense. This Court has repeatedly held that an accused in a state criminal prosecution has an unqualified right to make use of counsel at every stage of the proceedings against him.18 The broader implications of these decisions seem to me to support appellants' right to use their counsel when questioned by the Deputy Fire Marshal. It may be that the type of interrogation which the Fire Marshal and his deputies are authorized to conduct would not technically fit into the traditional category of formal criminal proceedings, but the substantive effect of such interrogation on an eventual criminal prosecution of the person questioned can be so great that he should not be compelled to give testimony when he is deprived of the advice of his counsel. It is quite possible that the conviction of a person charged with arson or a similar crime may be attributable largely to his interrogation by the Fire Marshal. The right to use counsel at the formal trial is a very hollow thing when, for all practical purposes, the conviction is already assured by pretrial examination.19
26
Looking at the substance of things, the Fire Marshal's secret interrogation contains many of the dangers to an accused that would be present if he were partially tried in secret without the assistance of counsel for 'arson or a similar crime.' Suppose that at the commencement of a criminal trial, the judge, acting under statutory authorization, expelled everyone from the courtroom but the prosecuting attorney and his assistants and allowed them to question the accused 'privately.' After such interrogation the doors were thrown open, the jury recalled, and the jurors given a re sume or transcript of the accused's purported testimony. And then the defendant's lawyer, who had been excluded from the secret examination, was allowed to make such defense as he could. Surely no one would contend that such a proceeding was due process of law. Yet the techniques as well as the end effects of the Fire Marshal's secret interrogation are substantially the same.
27
It is said that a witness can protect himself against some of the many abuses possible in a secret interrogation by asserting the privilege against self-incrimination. But this proposition collapses under anything more than the most superficial consideration. The average witness has little if any idea when or how to raise any of his constitutional privileges. There is no requirement in the Ohio statutes that the fire-prevention officers must inform the witness that he is privileged not to incriminate himself. And in view of the intricate possibilities of waiver which surround the privilege he may easily unwittingly waive it.20 If the witness is coerced or misled by his interrogators he may not dare to raise the privilege. Undoubtedly he will be made aware that hanging over his head at all times is the officer's power to punish him for contempt—a power whose limitations the witness will not understand. Furthermore, the Fire Marshal or his deputies would seldom be competent to decide if the privilege has been properly claimed or, even if they wish, to instruct the witness how to make correct use of it.
28
To support its decision that Ohio can punish a witness for refusing to submit to the Fire Marshal's secret interrogation, the majority places heavy reliance on the practice of examining witnesses before a grand jury in secret without the presence of the witness' counsel. But any surface support the grand jury practice may lend disappears upon analysis of that institution. The traditional English and American grand jury is composed of 12 to 23 members selected from the general citizenry of the locality where the alleged crime was committed.21 They bring into the grand jury room the experience, knowledge and viewpoint of all sections of the community. They have no axes to grind and are not charged personally with the administration of the law. No one of them is a prosecuting attorney or law-enforcement officer ferreting out crime. It would be very difficult for officers of the state seriously to abuse or deceive a witness in the presence of the grand jury. Similarly the presence of the jurors offers a substantial safeguard against for officers' misrepresentation, unintentional or otherwise, of the witness's statements and conduct before the grand jury. The witness can call on the grand jurors if need be for their normally unbiased testimony as to what occurred before them.
29
The majority also relies on a supposed proposition that there is no right to use counsel in an administrative investigation.22 Here it is relevant and significant to point out that in 1946 Congress specifically required in the Administrative Procedure Act that:
30
'Any person compelled to appear in person before any agency or representative thereof shall be accorded the right to be accompanied, represented, and advised by counsel or, if permitted by the agency, by other qualified representative.'23
31
In reporting the bill which was substantially enacted as the Administrative Procedure Act the Senate Judiciary Committee unanimously declared:
32
'By enacting this bill, the Congress—expressing the will of the people—will be laying down for the guidance of all branches of the Government and all private interests in the country a policy respecting the minimum requirements of fair administrative procedure.'24
33
And the House Judiciary Committee in reporting the House version of the Administrative Procedure Act stated:
34
'The bill is an outline of minimum essential rights and procedures.'25
35
Heretofore this Court has never held and I would never agree that an administrative agency conducting an investigation could validly compel a witness to appear before it and testify in secret without the assistance of his counsel.
36
In any event, the investigations authorized by the Ohio statutes are far more than mere administrative inquiries for securing information useful generally in the prevention of fires. Rather, these statutes command action with a view toward the apprehension and prosecution of persons believed guilty of certain crimes. The Marshal or his deputies may compel a person suspected of arson or a similar offense—as appellants apparently were—to appear and give testimony under oath. And as previously indicated any statement elicited from such person may be used as evidence against him. Once testimony has been taken from a suspect the duties of the Marshal and his deputies are not at an end. They must arrest the witness if they believe that the evidence is sufficient to charge him with certain crimes. All testimony taken from him and all other evidence must be turned over to the prosecuting attorney. The Fire Marshal and his deputy in charge of the 'Arson Bureau' are specifically made '* * * responsible * * * for the prosecution of persons believed to be guilty of arson or a similar crime.' The foregoing clearly demonstrates that the Fire Marshal's interrogation is, and apparently was intended to be, an important and integral part in the prosecution of the persons for arson or a similar crime.26 The rights of a persons who is examined in connection with such crimes should not be destroyed merely because the inquiry is given the euphonious label 'administrative.'27
37
Finally it is argued that the Fire Marshal and his deputies should have the right to exclude counsel and such other persons as they choose so that their 'investigatory proceedings' will not be 'unduly encumbered.' From all that appears the primary manner in which the presence of counsel or the public would 'encumber' the interrogation would be by protecting the legitimate rights of the witness.28 It is undeniable that law-enforcement officers could rack up more convictions if they were not 'hampered' by the defendant's counsel or the presence of others who might report to the public the manner in which people were being convicted.29 But the procedural safeguards deemed essential for due process have been imposed deliberately with full knowledge that they will occasionally impede the conviction of persons suspected of crime.
38
The majority states that 'with so weighty a public interest as fire prevention to protect,' they cannot hold that it violates the Due Process Clause to compel a witness to testify at a secret proceeding. But is the public's interest in fire prevention so weighty that it requires denying the person interrogated the basic procedural safeguards essential to justice? Suppose that Ohio authorized the Chief of State Police and his deputies to inquire into the causes and circumstances of crime generally and gave them power to compel witnesses or persons suspected of crime to appear and give testimony in secret. Since the public's interest in crime prevention is at least as great as its interest in fire prevention, the reasoning used in the majority's opinion would lead to the approval of such means of 'law enforcement.' In fact, the opinion could readily be applied to sanction a grant of similar power to every state trooper, policeman, sheriff, marshal, constable, FBI agent, prosecuting attorney, immigration official,30 narcotics agent, health officer, sanitation inspector, building inspector, tax collector, customs officer and to all the other countless state and federal officials who have authority to investigate violations of the law.31 I believe that the majority opinion offers a completely novel and extremely dangerous precedent—one that could be used to destroy a society of liberty under law and to establish in its place authoritarian government.
39
No one disputes that Ohio has a great interest in the enforcement of its fire laws. But there is nothing which suggests that it is essential to adequate enforcement of these laws to give the Fire Marshal and his deputies the extreme powers of interrogation which they proposed to exercise here. This method of law enforcement has heretofore been deemed inconsistent with our system of justice. As Mr. Justice Frankfurter said in announcing the Court's judgment in Watts v. State of Indiana, 338 U.S. 49, at page 54, 69 S.Ct. 1347, at page 1350, 93 L.Ed. 1801:
40
'Ours is the accusatorial as opposed to the inquisitorial system. Such has been the characteristic of Anglo-American criminal justice since it freed itself from practices borrowed by the Star Chamber from the Continent whereby an accused was interrogated in secret for hours on end. * * * Under our system society carries the burden of proving its charge against the accused not out of his own mouth. It must establish its case, not by interrogation of the accused even under judicial safeguards, but by evidence independently secured through skillful investigation.'32
41
Secret inquisitions are dangerous things justly feared by free men everywhere.33 They are the breeding place for arbitrary misuse of official power. They are often the beginning of tyranny as well as indispensable instruments for its survival. Modern as well as ancient history bears witness that both innocent and guilty have been seized by officers of the state and whisked away for secret interrogation or worse until the groundwork has been securely laid for their inevitable conviction. While the labels applied to this practice have frequently changed, the central idea wherever and whenever carried out remains unchanging—extraction of 'statements' by one means or another from an individual by officers of the state while he is held incommunicado. I reiterate my belief that it violates the Due Process Clause to compel a person to answer questions at a secret interrogation where he is denied legal assistance and where he is subject to the uncontrolled and invisible exercise of power by government officials. Such procedures are a grave threat to the liberties of a free people.
1
Page's Ohio Rev.Code, § 3737.13.
2
Appellants were released on bond and have never in fact been incarcerated.
3
In re Groban, 99 Ohio App. 512, 135 N.E.2d 477; 164 Ohio St. 26, 128 N.E.2d 106.
4
Page's Ohio Rev.Code, §§ 3737.08, 3737.10.
5
In re Black, 2 Cir., 47 F.2d 542; accord, United States v. Blanton, D.C., 77 F.Supp. 812; see United States v. Scully, 2 Cir., 225 F.2d 113, 116.
6
Bowles v. Baer, 7 Cir., 142 F.2d 787; United States v. Levine, D.C., 127 F.Supp. 651. Note, Rights of Witnesses in Administrative Investigations, 54 Harv.L.Rev. 1214, 1216—1217.
7
Cf. Ullmann v. United States, 350 U.S. 422, 76 S.Ct. 497, 100 L.Ed. 511; Hoffman v. United States, 341 U.S. 479, 486, 71 S.Ct. 814, 95 L.Ed. 1118; Smith v. United States, 337 U.S. 137, 150, 69 S.Ct. 1000, 1007, 93 L.Ed. 1264; Hale v. Henkel, 201 U.S. 43, 66—67, 26 S.Ct. 370, 375—376, 50 L.Ed. 652.
8
See National Fire Protection Association Handbook of Fire Protection (10th ed. 1948) 41—45; Annual Report of the Division of (Ohio) State Fire Marshal for 1955.
9
Ohio Laws 1900, Senate Bill No. 51.
1
James Otis used this phrase in denouncing the Writs of Assistance and General Warrants in his famous argument in Paxton's Case. 2 The Works of John Adams (Boston 1850), App. 524.
2
In re Oliver, 333 U.S. 257, 273, 68 S.Ct. 499, 507, 92 L.Ed. 682.
3
Powell v. State of Alabama, 287 U.S. 45, 69, 53 S.Ct. 55, 64, 77 L.Ed. 158.
4
Page's Ohio Rev.Code, §§ 3737.11, 3737.12.
5
Id., §§ 3737.12, 3737.99(A).
6
Id., § 3737.13.
7
Id., § 3737.10.
8
Id., § 3737.10.
9
Id., § 3737.02.
10
I would also reverse the decision below because appellants were found guilty of contempt and sentenced to jail in a proceeding where they were denied the benefit of counsel. This Court has expressly held that a person charged with contempt has a constitutional right to be heard through counsel of his own choosing at a trial on the contempt charge. In re Oliver, 333 U.S. 257, 68 S.Ct. 499, 92 L.Ed. 682. While the majority refuses to act on the denial here by claiming that appellants failed to challenge it in the Ohio Supreme Court or in their appeal to this Court, the record convinces me that the matter has been properly raised for our consideration. When a person is to be imprisoned as the result of a proceeding in which he was denied his constitutional rights, we should not be anxious to conclude that he has failed to raise the constitutional questions in the correct procedural form. Cf. Aetna Ins. Co. v. Kennedy, 301 U.S. 389, 393, 57 S.Ct. 809, 811, 81 L.Ed. 1177; Hodges v. Easton, 106 U.S. 408, 412, 1 S.Ct. 307, 310, 27 L.Ed. 169.
11
See generally 15 Ohio Jur. 2d, Criminal Law § 388.
12
In this respect it is important to note that under the Ohio statutes the Fire Marshal or his deputies may permit such persons as they wish to attend the interrogation.
13
This has been recognized from ancient times. As said in Matthew 18:15—16:
'Moreover if thy brother shall trespass against thee, go and tell him his fault between thee and him alone: if he shall hear thee, thou has gained thy brother. But if he will not hear thee, then take with thee one or two more, that in the mouth of two or three witnesses every word may be established.'
Blackstone many centuries later noted that:
'(The) open examination of witnesses viva voce, in the presence of all mankind, is much more conducive to the clearing up of truth, than the private and secret examination taken down in writing before an officer, or his clerk * * *. There an artful or careless scribe may make a witness speak what he never meant * * *.' 3 Blackstone Commentaries 373.
And Bentham subsequently pointed out:
'In case of registration and recordation of the evidence, publicity serves as a security for the correctness in every respect (completeness included) of the work of the registrator.
'In case of material incorrectness, whether by design or inadvertence,—so many auditors present * * * any or each of whom may eventually be capable of indicating, in the character of a witness, the existence of the error, and the tenor (or at least the purport) of the alteration requisite for the correction of it.' 1 Bentham, Rationale of Judicial Evidence (1827), 523.
14
See, e.g., Fikes v. State of Alabama, 352 U.S. 191, 77 S.Ct. 281, 1 L.Ed.2d 246; Leyra v. Denno, 347 U.S. 556, 74 S.Ct. 716, 98 L.Ed. 948; Watts v. State of Indiana, 338 U.S. 49, 69 S.Ct. 1347, 93 L.Ed. 1801; Turner v. Commonwealth of Pennsylvania, 338 U.S. 62, 69 S.Ct. 1352, 93 L.Ed. 1810; Harris v. State of South Carolina, 338 U.S. 68, 69 S.Ct. 1354, 93 L.Ed. 1815; Haley v. State of Ohio, 332 U.S. 596, 68 S.Ct. 302, 92 L.Ed. 224; Malinski v. People of State of New York, 324 U.S. 401, 65 S.Ct. 781, 89 L.Ed. 1029; Ashcraft v. State of Tennessee, 322 U.S. 143, 64 S.Ct. 921, 88 L.Ed. 1192; Ward v. State of Texas, 316 U.S. 547, 62 S.Ct. 1139, 86 L.Ed. 1663; White v. State of Texas, 310 U.S. 530, 60 S.Ct. 1032, 84 L.Ed. 1342; Chambers v. State of Florida, 309 U.S. 227, 60 S.Ct. 472, 84 L.Ed. 716. For a discussion of the dangers and abuses arising from the secret interrogation of suspects by police see the report of the American Bar Association's Committee on Lawless Enforcement of the Law, Aug. 19, 1930. 1 Am.J. Police Science 575.
15
In United States v. Minker, 350 U.S. 179, at page 188, 76 S.Ct. 281, at page 287, 100 L.Ed. 185, the Court pointed out with regard to proposed examinations by immigration officers that:
'It does not bespeak depreciation of official zeal, nor does it bring into question disinterestedness, to conclude that compulsory ex parte administrative examinations, untrammelled by the safeguards of a public adversary judicial proceeding, afford too ready opportunities for unhappy consequences to prospective defendants in denaturalization suits.'
16
It seems wholly improper to 'wait and see' in each case whether a witness has been coerced or tricked into giving involuntary statements at the secret interrogation and then to set aside convictions which may be based on such statements. This 'abuse-by-abuse' approach fails to give the person interrogated sufficient protection. Usually he has no substantial chance of showing that the one or more interrogators used improper means to elicit involuntary statements from him. Only in the most extreme cases will this Court, or any other, be able to find that statements were made involuntarily in the face of the interrogating officers' testimony that they were spontaneous and freely given. Apparently in Ohio, as in most jurisdictions, the suspect faces the additional obstacle that his alleged statements are presumed to be voluntary and he has the burden of proving that they were not. See 15 Ohio Jur.2d, Criminal Law, § 387. In the few cases where a person interrogated could prove that his statements were made involuntarily he will still be subjected to considerable expense, inconvenience and unfavorable publicity. More important, he will already have suffered mistreatment at the hands of his interrogators.
17
Here, of course, the interrogators were authorized to try the charges of contempt which they preferred.
18
See, e.g., Powell v. State of Alabama, 287 U.S. 45, 53 S.Ct. 55, 77 L.Ed. 158; Chandler v. Fretag, 348 U.S. 3, 75 S.Ct. 1, 99 L.Ed. 4.
19
This was recognized in Ex parte Sullivan, D.C., 107 F.Supp. 514, 517. There two persons suspected of crime had been examined by law-enforcement officers in secret without the presence of counsel and had been tricked into making statements which were instrumental in their conviction. At pages 517—518, the district judge observed:
'In view of (Powell v. State of Alabama, 287 U.S. 45, 53 S.Ct. 55, 77 L.Ed. 158), to mention but one of many cases, unquestionably Petitioners were entitled to have effective counsel at the trial. The question here is how they ever could have had effective counsel at the trial, no matter how skilled, in view of what went on before trial. They were denied effective counsel at the trial itself because of what went on before trial while the defendants were without counsel, and absolutely under the control of the prosecution. * * * One can imagine a cynical prosecutor saying: 'Let them have the most illustrious counsel, now. They can't escape the noose. There is nothing that counsel can do for them at the trial." (Emphasis not supplied.)
Also see Jackson, J., concurring in Watts v. State of Indiana, 338 U.S. 49, 57, 69 S.Ct. 1347, 1351, 93 L.Ed. 1801.
20
See, e.g., Rogers v. United States, 340 U.S. 367, 71 S.Ct. 438, 95 L.Ed. 344.
21
All of the cases cited by the majority as authority for the practice before grand juries apparently involved a traditional grand jury. It has been suggested that a state can constitutionally provide for grand juries composed of less than 12 persons. See In re Murchison, 349 U.S. 133, 139, 140, 75 S.Ct. 623, 626, 627, 99 L.Ed. 942 (dissenting opinion); In re Oliver, 333 U.S. 257, 283, 283—284, 68 S.Ct. 499, 512, 512—513, 92 L.Ed. 682 (dissenting opinion). Even if this suggestion is correct it certainly does not follow that a state can designate one or more of its law-enforcement officers as a grand jury and constitutionally give them power to compel witnesses to appear and give testimony in secret without the pressence of counsel. This point was expressly not considered in In re Oliver, supra, 333 U.S. at page 265, 68 S.Ct. at page 503. Such power in the hands of law-enforcement officers is equally obnoxious to due process whether they are styled as a grand jury, as fire-prevention officers or simply as policemen.
22
The only authorities offered by the majority as support for this proposition are three lower federal court decisions.
23
5 U.S.C. § 1005(a), 5 U.S.C.A. § 1005(a).
24
S.Rep.No.752, 79th Cong., 1st Sess. 31.
25
H.R.Rep.No.1980, 79th Cong., 2d Sess. 16.
26
It seems highly unrealistic to equate this interrogation with a proceeding involving a claim for workmen's compensation.
27
Nor should they be defeated because the Fire Marshal and his deputies are given other duties besides investigating fires to determine if any criminality is involved. For obvious reasons these other responsibilities do not make the interrogation proposed here any less objectionable.
28
Perhaps, if a real need could be shown, counsel could be restricted to advising his client and prohibited from making statements or asking questions. And there are other alternatives, much less drastic and prejudicial to the witness than the complete exclusion of his counsel, which might provide satisfactory protection for the witness without unduly impairing the efficiency of the examination.
29
As Bentham said of criminal proceedings:
'Without publicity, all other checks are insufficient: in comparison of publicity, all other checks are of small account. Recordation, appeal, whatever other institutions might present themselves in the character of checks, would be found to operate rather as cloaks than checks; as cloaks in reality, as checks only in appearance.' 1 Bentham, Rationale of Judicial Evidence (1827), 524.
30
See United States v. Minker, 350 U.S. 179, 76 S.Ct. 281, 100 L.Ed. 185.
31
The Court's opinion does not deny that secret inquisitorial powers could be given such law enforcement-officers. A concurring opinion suggests that the grant of such broad power might be unconstitutional so far as a district attorney is concerned. However if policemen in general could constitutionally subject persons to secret compulsory interrogation, how can it be said that a district attorney could not? For constitutional purposes I can see no means of distinguishing this Ohio fire policeman from any other policeman or law-enforcement officer. Any attempted constitutional distinction between these various law-enforcement officers would be purely artificial. The constitutionality of the Ohio law authorizing secret interrogation by fire marshals acting as policemen in arson cases should not be rested on a conjecture that such an artificial distinction will be drawn by this Court at some future day.
32
A survey of British law reveals nothing which is equivalent to the type of examination that the Ohio Fire Marshal is allowed to conduct. Official inquiries into the cause of fires are generally made by the police. '(W)hen the police are inquiring into a case, they have no power to compel anyone to give them information; a witness may be compelled to attend a court and there give evidence, but before proceedings are actually brought he can refuse to say a word.' Jackson, The Machinery of Justice in England (2d ed. 1953), 137. And in 1929, the Report of the Royal Commission on Police Powers and Procedure at p. 118 recommended that 'A rigid instruction should be issued to the Police that no questioning of a prisoner, or a 'person in custody,' about any crime or offence with which he is, or may be, charged, should be permitted.' It is doubtful if any statements obtained by the police by secret interrogation of a suspect would be admitted in evidence in a subsequent trial. See Rex v. Grayson, 16 Crim.App.R. 7 (1921); 43 Harv.L.Rev. 618; 43 Ky.L.Rev. 403.
In France official inquiries into fires are carried out as part of the general system of investigating crimes. The preliminary investigation is under the control of the public prosecutor and is conducted by the police. They have no authority to examine unwilling witnesses. The interrogation of such witnesses and of suspects is the function of the Juge d'Instruction, who is a judge with legal training. Prior to 1897 he had broad power to examine a witness under oath in secret without counsel. See Ploscowe, Development of inquisitorial and Accusatorial Elements in French Procedure, 23 J.Crim.L. & Criminology 372. In 1882 Stephen commented on these secret proceedings as follows:
'To a person accustomed to the English system and to English ways of thinking and feeling * * * the French system would be utterly intolerable in England. The substitution of a secret (interrogation) for our open investigation before the committing magistrate would appear to us to poison justice at its source.' 1 Stephen, History of the Criminal Law of England (1883), 565.
In response to widespread demands French law was changed in 1897 to grant a witness appearing before the Juge d'Instruction the right to counsel. M. Constans, one of the sponsors of the law in the French Senate, said: 'The juge d'instruction is like other functionaries. He must be controlled * * *. The presence of the lawyer will of itself * * * prevent him from doing anything but his duty.' Quoted in Ploscowe, supra, at 381. See also Esmein, History of Continental Criminal Procedure (1913); Keedy, The Preliminary Investigation of Crime in France, 88 U.Pa.L.Rev. 692.
33
A leading Italian jurist recently said:
'The right to counsel, without which the right to defend oneself is of no practical meaning, does not exist during the first phase of the criminal process in those systems in which the pre-trial phase is carried out in secret without the presence of defense counsel. This is the phase in which the accused, alone and undefended before the examining magistrate, may be unable to find in his own innocence sufficient strength to resist the effects of prolonged questioning, and in order to put an end to his ordeal may be reduced to signing a confession to a crime he has not committed. Unfortunately, Italian criminal procedure retains this sad inheritance from an era of tyranny, which is unreconcilable with respect for the human personality * * *.
'In criminal procedure as we see it applied, the accused is still an inert object at the mercy of the inquisitor's violence. * * * Held incommunicado during the period of questioning, the accused is alone with his examiners, without aid of counsel; torture, although formally abolished, has returned under new guises more scientific but nonetheless cruel: the third degree, endless hours of incessant questioning, truth serum.' Calamandrei, Procedure and Democracy (Adams transl. 1956), 93—94, 102—103.
| 01
|
355 U.S. 901
352 U.S. 457
UNITED STATES GYPSUM CO.v.NATIONAL GYPSUM CO. ET AL.,
No. 11.
Supreme Court of United States.
December 16, 1957.
1
The motion of appellant for recall and modification of the judgment is denied without prejudice to the Solicitor General moving to dissolve the three-judge district court. MR. JUSTICE CLARK took no part in the consideration of decision of this motion. Bruce Bromley, Cranston Spray, Robert C. Keck, John D. Calhoun and Hugh Lynch, Jr. for appellant-movant. Solicitor General Rankin, Assistant Attorney General Hansen, Charles H. Weston and Edward Knuff for the United States, and Samuel I. Rosenman, Elmer E. Finck, Seymour D. Lewis, Malcolm A. Hoffmann and Seymour Krieger for the National Gypsum Co., appellees.
| 78
|
352 U.S. 500
77 S.Ct. 444
1 L.Ed.2d 515
James C. ROGERS, Petitioner,v.MISSOURI PACIFIC RAILROAD CO. John W. WEBB, Petitioner, v. ILLINOIS CENTRAL RAILROAD CO. Virgil HERDMAN, Petitioner, v. PENNSYLVANIA RAILROAD CO. Henry FERGUSON, Petitioner, v. MOORE-McCORMACK LINES, Inc.
Nos. 28, 42, 46 and 59.
Decided Feb. 25, 1957.
Mr. Mark D. Eagleton, St. Louis, Mo., for the petitioner.
Mr. Donald B. Sommers, St. Louis, Mo., for the respondent.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
A jury in the Circuit Court of St. Louis awarded damages to the petitioner in this action under the Federal Employers' Liability Act.1 The Supreme Court of Missouri reversed upon the ground that the petitioner's evidence did not support the finding of respondent's liability.2 This Court granted certiorari to consider the question whether the decision invaded the jury's function.3
2
Petitioner was a laborer in a section gang, working on July 17, 1951, along a portion of respondent's double-track line which, near Garner, Arkansas, runs generally north and south. The tracks are on ballast topping the surface of a dirt 'dump' with sloping sides, and there is a path about a yard wide bordering each side of the surface between the crest of the slope and the edge of the allast. Weeds and vegetation, killed chemically preparatory to burning them off, covered the paths and slopes. Petitioner's foreman assigned him to burn off the weeds and vegetation—the first time he was given that task in the two months he had worked for the respondent. He testified that it was customary to burn off such vegetation with a flame thrower operated from a car running on the tracks. Railroad witnesses testified, however, that the respondent discontinued the use of flame throwers at least a year earlier because the fires started by them sometimes spread beyond the railroad right of way.
3
Petitioner was supplied with a crude hand torch and was instructed to burn off the weeds and vegetation along the west path and for two or three feet down the west slope. The events leading to his mishap occurred after he proceeded with the work to a point within thirty to thirty-five years of a culvert adjoining the path.
4
Petitioner testified, without contradiction, that the foreman instructed him and other members of the section gang to stop what they were doing when a train passed and to take positions off the tracks and ties to observe in journals of the passing train for hotboxes. The instructions were explicit not to go on either of the tracks or to stand on or near the ends of the ties when a train was passing on a far track. This was a safety precaution because 'the sound of one train would deaden the sound of another one that possibly would come from the other way.'
5
On this day, petitioner heard the whistle of a train which was approaching from behind him on the east track. He promptly 'quit firing' and ran north to a place on the path near the mentioned culvert. He was standing a few feet from the culvert observing the train for hotboxes when he became enveloped in smoke and flames. The passing train had fanned the flames of the burning vegetation and weeds, carrying the fire to the vegetation around his position. He threw his arm over his face, retreated quickly back on the culvert and slipped and fell from the top of the culvert, suffering the serious injuries for which he sought damages in this suit.
6
The complaint alleges negligence in that petitioner was 'required to work at a place in close proximity to defendant's railroad tracks, whereon trains moved and passed, causing the fire from said burning weeds and the smoke therefrom to come dangerously close to plaintiff and requiring plaintiff to move away from said danger.' Negligence was also alleged in that the surface of the culvert was not properly maintained because, instead of the usual flat surface giving firm footing for workmen, the surface was 'covered with loose and sloping gravel which did not provide adequate or sufficient footing for plaintiff to thus move or work under the circumstances.'
7
We think that the evidence was sufficient to support the jury finding for the petitioner. The testimony that the burning off of weeds and vegetation was ordinarily done with flame throwers from cars on the tracks and not, as here, by a workman on foot using a crude hand torch, when that evidence is considered with the uncontradicted testimony that the petitioner was where he was on this narrow path atop the dirt 'dump' in furtherance of explicit orders to watch for hotboxes, supplied ample support for a jury finding that respondent's negligence played a part in the petitioner's injury. These were probative facts from which the jury could find that respondent was or should have been aware of conditions which created a likelihood that petitioner, in performing the duties required of him, would suffer just such an injury as he did.4 Common experience teaches both that a passing train will fan the flames of a fire, and that a person suddenly enveloped in flames and smoke will instinctively react by retreating from the danger and in the process pay scant heed to other dangers which may imperil him. In this view, it was an irrelevant consideration whether the immediate reason for his slipping off the culvert was the presence of gravel negligently allowed by respondent to remain on the surface, or was some cause not identified from the evidence.
8
The Missouri Supreme Court based its reversal upon its finding of an alleged admission by the petitioner that he knew it was his primary duty to watch the fire. From that premise the Missouri court reasoned that petitioner was inattentive to the fire and that the emergency which confronted him 'was an emergency brought about by himself.'5 It said that if, as petitioner testified, the immediate cause of his fall was that loose gravel on the surface of the culvert rolled out from under him, yet it was his inattention to the fire which caused it to spread and obliged petitioner 'to move blindly away and fall,' and this was 'something extraordinary, unrelated to, and disconnected from the incline of the gravel at the culvert.'6
9
We interpret the foregoing to mean that the Missouri court found as a matter of law that the petitioner's conduct was the sole cause of his mishap. But when the petitioner agreed that his primary duty was to watch the fire he did not also say that he was relieved of the duty to stop to watch a passing train for hotboxes. Indeed, no witness testified that the instruction was countermanded. At best, uncertainty as to the fact arises from the petitioner's testimony, and in that circumstance not the court, but the jury, was the tribunal to determine the fact.
10
We may assume that the jury could properly have reached the court's conclusion. But, as the probative facts also supported with reason the verdict favorable to the petitioner,7 the decision was exclusively for the jury to make.8 The jury was instructed to return a verdict for the respondent if it was found that negligence of the petitioner was the sole cause of his mishap.9 We must take it that the verdict was obedient to the trial judge's charge and that the jury found that such was not the case but that petitioner's injury resulted at least in part from the respondent's negligence.
11
The opinion may also be read as basing the reversal on another ground, namely, that it appeared to the court that the petitioner's conduct was at least as probable a cause for his mishap as any negligence of the respondent, and that in such case there was no case for the jury. But that would mean that there is no jury question in actions under this statute, although the employee's proofs support with reason a verdict in his favor, unless the judge can say that the jury may exclude the idea that his injury was due to causes with which the defendant was not connected, or, stated another way, unless his proofs are so strong that the jury, on grounds of probability, may exclude a conclusion favorable to the defendant. That is not the governing principle defining the proof which requires a submission to the jury in these cases. The Missouri court's opinion implies its view that this is the governing standard by saying that the proofs must show that 'the injury would not have occurred but for the negligence' of his employer, and that '(t)he test of whether there is causal connection is that, absent the negligent act the injury would not have occurred.'10 That is language of proximate causation which makes a jury question dependent upon whether the jury may find that the defendant's negligence was the sole, efficient, producing cause of injury.
12
Under this statute the test of a jury case is simply whether the proofs justify with reason the conclusion that enployer negligence played any part, even the slightest, in producing the injury or death for which damages are sought.11 It does not matter that, from the evidence, the jury may also with reason, on grounds of probability, attribute the result to other causes, including the employee's contributory negligence.12 Judicial appraisal of the proofs to determine whether a jury question is presented is narrowly limited to the single inquiry whether, with reason, the conclusion may be drawn that negligence of the employer played any part at all in the injury or death.13 Judges are to fix their sights primarily to make that appraisal and, if that test is met, are bound to find that a case for the jury is made out whether or not the evidence allows the jury a choice of other probabilities. The statute expressly imposes liability upon the employer to pay damages for injury or death due 'in whole or in part' to its negligence.14 (Emphasis added.)
13
The law was enacted because the Congress was dissatisfied with the common-law duty of the master to his servant.15 The statute supplants that duty with the far more drastic duty of paying damages for injury or death at work due in whole or in part to the employer's negligence. The employer is stripped of his common-law defenses and for practical purposes the inquiry in these cases today rarely presents more than the single question whether negligence of the employer played any part, however small, in the injury or death which is the subject of the suit.16 The burden of the employee is met, and the obligation of the employer to pay damages arises, when there is proof, even though entirely circumstantial,17 from which the jury may with reason make that inference.
14
The Congress when adopting the law was particularly concerned that the issues whether there was employer fault and whether that fault played any part in the injury or death of the employee should be decided by the jury whenever fair-minded men could reach these conclusions on the evidence.18 Originally, judicial administration of the 1908 Act substantially limited the cases in which employees were allowed a jury determination. That was because the courts developed concepts of assumption of risk19 and of the coverage of the law,20 which defeated employee claims as a matter of law. Congress corrected this by the 1939 amendments and removed the fetters which hobbled the full play of the basic congressional intention to leave to the fact-finding function of the jury the decision of the primary question raised in these cases—whether employer fault played any part in the employee's mishap.21
15
Cognizant of the duty to effectuate the intention of the Congress to secure the right to a jury determination, this Court is vigilant to exercise its power of review in any case where it appears that the litigants have been improperly deprived of that determination.22 Some say the Act has shortcomings and would prefer a workmen's compensation scheme. The fact that Congress has not seen fit to substitute that scheme cannot relieve this Court of its obligation to effectuate the present congressional intention by granting certiorari to correct instances of improper administration of the Act and to prevent its erosion by narrow and niggardly construction. Similarly, once certiorari is granted, the fact that the case arises under the Federal Employers' Liability Act cannot in any wise justify a failure on our part to afford the litigants the same measure of review on the merits as in every other case.23
16
The kind of misconception evidenced in the opinion below, which fails to take into account the special features of this statutory negligence action that make it significantly different from the ordinary common-law negligence action, has required this Court to review a number of cases.24 In a relatively large percentage of the cases reviewed, the Court has found that lower courts have not given proper scope to this integral part of the congressional scheme. We reach the same conclusion in this case.25 The decisions of this Court after the 1939 amendments teach that the Congress vested the power of decision in these actions exclusively in the jury in all but the infrequent cases26 where fair-minded jurors cannot honestly differ whether fault of the employer played any part in the employee's injury. Special and important reasons for the grant of certiorari in these cases are certainly present when lower federal and state courts persistently deprive litigants of their right to a jury determination.
17
We have considered the remaining questions not passed upon by the Supreme Court of Missouri, and find them to be unsubstantial. Accordingly, we remand the case for proceedings not inconsistent with this opinion.
18
The judgment is reversed.
19
Reversed.
20
Mr. Justice BURTON concurs in the result.
21
Mr. Justice REED would affirm the judgment of the Supreme Court of Missouri.
22
For dissenting opinions of Mr. Justice FRANKFURTER, and Mr. Justice HARLAN, see 352 U.S. 518, 77 S.Ct. 459.
1
35 Stat. 65, as amended, 36 Stat. 291, 53 Stat. 1404, 45 U.S.C. § 51 et seq., 45 U.S.C.A. § 51 et seq.
2
Mo., 284 S.W.2d 467.
3
350 U.S. 964, 76 S.Ct. 440, 100 L.Ed. 837.
4
Lillie v. Thompson, 332 U.S. 459, 68 S.Ct. 140, 92 L.Ed. 73.
5
Mo., 284 S.W.2d at page 472.
6
Ibid.
7
Myers v. Reading Co., 331 U.S. 477, 67 S.Ct. 1334, 91 L.Ed. 1615.
8
'The very essence of (the jury's) function is to select from among conflicting inferences and conclusions that which it considers most reasonable.' Tennant v. Peoria & P.U.R. Co., 321 U.S. 29, 35, 64 S.Ct. 409, 412, 88 L.Ed. 520.
9
The jury was not charged that contributory negligence, if any, was to be considered merely in diminution of any damages. 35 Stat. 66, 45 U.S.C. § 53, 45 U.S.C.A. § 53. Instruction No. 2 was as follows:
'The Court instructs the jury that under the law applicable to this case it was the duty of the plaintiff to exercise ordinary care for his own safety, at all times, while performing his duties as an employee of the defendant.
'In this connection, the Court instructs the jury that if you find and believe from the evidence that on July 17, 1951 the plaintiff, James C. Rogers, while an employee of the defendant and while burning weeds on a portion of defendant's right-of-way near 'Garner Crossing' near the City of Garner, Arkansas, did move about on said railroad right-of-way with his arm over his eyes, and did move backwards and sidewards without looking in the direction in which he was walking, and if you further find that under the circumstances mentioned in the evidence the plaintiff, in exercising ordinary care for his own safety, could have and should have looked in the direction in which he was walking, but failed to do so and, if you further find that the plaintiff in failing to do so did not exercise ordinary care for his own safety and was guilty of negligence and that such negligence, if any, was the sole proximate cause of his injuries, if any, and that such alleged injuries, if any, were not directly contributed to or caused by any negligence of the defendant in any of the particulars submitted to you in other instructions herein, then, in that event, the plaintiff is not entitled to recover against the defendant, and you will find your verdict in favor of the defendant.'
10
Mo., 284 S.W.2d at page 471.
11
Coray v. Southern Pacific Co., 335 U.S. 520, 69 S.Ct. 275, 93 L.Ed. 208.
12
'* * * (T)he fact that the employee may have been guilty of contributory negligence shall not bar a recovery, but the damages shall be diminished by the jury in proportion to the amount of negligence attributable to such employee: Provided, That no such employee who may be injured or killed shall be held to have been guilty of contributory negligence in any case where the violation by such common carrier of any statute enacted for the safety of employees contributed to the injury or death of such employee.' 35 Stat. 66, 45 U.S.C. § 53, 45 U.S.C.A. § 53.
13
Proof of violation of certain safety-appliance statutes without more proves negligence and also eliminates contributory negligence as a consideration for any purpose. Note 11, supra. The only issue then remaining is causation. Carter v. Atlanta & St. A.B.R. Co., 338 U.S. 430, 70 S.Ct. 226, 94 L.Ed. 236; Myers v. Reading Co., 331 U.S. 477, 67 S.Ct. 1334, 91 L.Ed. 1615.
Moreover, '(w)hat constitutes negligence for the statute's purposes is a federal question, not varying in accordance with the differing conceptions of negligence applicable under state and local laws for other purposes. Federal decisional law formulating and applying the concept governs.' Urie v. Thompson, 337 U.S. 163, 174, 69 S.Ct. 1018, 1027, 93 L.Ed. 1282.
14
'* * * (E)very common carrier by railroad while engaging in commerce between any of the several States * * * shall be liable in damages to any person suffering injury * * * or * * * death * * * resulting in whole or in part from the negligence of any of the officers, agents, or employees of such carrier * * *.' (Emphasis added.) 35 Stat. 65, 45 U.S.C. § 51, 45 U.S.C.A. § 51; Coray v. Southern Pacific Co., 335 U.S. 520, 523—524, 69 S.Ct. 275, 276, 277, 93 L.Ed. 208.
15
For a comprehensive survey of the history of the FELA, see Griffith, The Vindication of a National Public Policy Under the Federal Employers' Liability Act, 18 Law & Contemp.Prob. 160.
16
Tiller v. Atlantic Coast Line R. Co., 318 U.S. 54, 63 S.Ct. 444, 87 L.Ed. 610.
17
Circumstantial evidence is not only sufficient, but may also be more certain, satisfying and persuasive than direct evidence. The Robert Edwards, 6 Wheat. 187, 190, 5 L.Ed. 238.
18
While the primary reason was a protest against undue comment by trial judges as to the facts, the original 1906 Act provided: 'All questions of negligence and contributory negligence shall be for the jury.' 34 Stat. 232. Hearings before Senate Committee on Interstate Commerce on H.R. 239, 59th Cong., 1st Sess. 68—69. The inclusion in the 1908 statute of another provision, 'All questions of fact relating to negligence shall be for the jury to determine,' was proposed but not adopted. The view prevailed that this would be surplusage in light of the Seventh Amendment embodying the common-law tradition that fact questions were for the jury. Hearings before Senate Committee on Education and Labor on S. 5307, 60th Cong., 1st Sess. 8—9, 45—46.
19
Seaboard Air Line R. Co. v. Horton, 233 U.S. 492, 34 S.Ct. 635, 58 L.Ed. 1062.
20
Tipton v Atchison, T. & S.F.R. Co., 298 U.S. 141, 56 S.Ct. 715, 80 L.Ed. 1091; Illinois Central R. Co. v. Behrens, 233 U.S. 473, 34 S.Ct. 646, 58 L.Ed. 1051.
21
53 Stat. 1404. For this Court's interpretation of these amendments, see Tiller v. Atlantic Coast Line R. Co., 318 U.S. 54, 63 S.Ct. 444, 87 L.Ed. 610 (assumption of risk); Southern Pacific Co. v. Gileo, 351 u.S. 493, 76 S.Ct. 952, 100 L.Ed. 1357 (coverage); Reed v. Pennsylvania R. Co., 351 U.S. 502, 76 S.Ct. 958, 100 L.Ed. 1366 (coverage).
22
Jacob v. New York City, 315 U.S. 752, 62 S.Ct. 854, 86 L.Ed. 1166.
23
We adopt the reasoning in this regard of Part I of Mr. Justice HARLAN'S opinion concurring in No. 46 and dissenting in this case and in Nos. 42 and 59, 352 U.S. 518, 77 S.Ct. 459.
24
See Appendix to opinion of Mr. Justice DOUGLAS in Wilkerson v. McCarthy, 336 U.S. 53, 71, 69 S.Ct. 413, 422, 93 L.Ed. 497; Note, 69 Harv.L.Rev. 1441.
25
Rule 19, 28 U.S.C.A. authorizes this Court to review by certiorari the judgment of a lower federal or state court 'where there are special and important reasons therefor,' such as deciding a federal question of substance in a way probably not in accord with, or in conflict with, applicable decisions of this Court.
26
This Court found that a jury question was presented, and reversed in the following cases: Schulz v. Pennsylvania R. Co., 350 U.S. 523, 76 S.Ct. 608, 100 L.Ed. 668; Stone v. New York, C. & St. L.R. Co., 344 U.S. 407, 73 S.Ct. 358, 97 L.Ed. 441; Carter v. Atlanta & St. A. B.R. Co., 338 U.S. 430, 70 S.Ct. 226, 94 L.Ed. 236; Wilkerson v. McCarthy, 336 U.S. 53, 69 S.Ct. 413, 93 L.Ed. 497; Anderson v. Atchison, T. & S.F.R. Co., 333 U.S. 821, 68 S.Ct. 854, 92 L.Ed. 1108; Lillie v. Thompson, 332 U.S. 459, 68 S.Ct. 140, 92 L.Ed 73; Myers v. Reading Co., 331 U.S. 477, 67 S.Ct. 1334, 91 L.Ed. 1615; Ellis v. Union Pac. R. Co., 329 U.S. 649, 67 S.Ct. 598, 91 L.Ed. 572; Jesionowski v. Boston & M.R. Co., 329 U.S. 452, 67 S.Ct. 401, 91 L.Ed. 416; Lavender v. Kurn, 327 U.S. 645, 66 S.Ct. 740, 90 L.Ed. 916; Keeton v. Thompson, 326 U.S. 689, 66 S.Ct. 135, 90 L.Ed. 405; Blair v. Baltimore & O.R. Co., 323 U.S. 600, 65 S.Ct. 545, 89 L.Ed. 490; Tiller v. Atlantic Coast Line R. Co., 323 U.S. 574, 65 S.Ct. 421, 89 L.Ed. 465; Tennant v. Peoria & P.U.R. Co., 321 U.S. 29, 64 S.Ct. 409, 88 L.Ed. 520; Bailey v. Central Vt. R. Co., 319 U.S. 350, 63 S.Ct. 1062, 87 L.Ed. 1444; Tiller v. Atlantic Coast Line R. Co., 318 U.S. 54, 63 S.Ct. 444, 87 L.Ed. 610; Seago v. New York Cent. R. Co., 315 U.S. 781, 62 S.Ct. 806, 86 L.Ed. 1188; Jenkins v. Kurn, 313 U.S. 256, 61 S.Ct. 934, 85 L.Ed. 1316.
The Court found that no question for the jury was presented, and affirmed in the following cases: Moore v. Chesapeake & O.R. Co., 340 U.S. 573, 71 S.Ct. 428, 95 L.Ed. 547; Eckenrode v. Pennsylvania R. Co., 335 U.S. 329, 69 S.Ct. 91, 93 L.Ed. 41; Brady v. Southern R. Co., 320 U.S. 476, 64 S.Ct. 232, 88 L.Ed. 239.
| 78
|
352 U.S. 322
77 S.Ct. 403
1 L.Ed.2d 370
Ollie Otto PRINCE, Petitioner,v.UNITED STATES of America.
No. 132.
Argued Dec. 11, 1956.
Decided Feb. 25, 1957.
Mr. Joseph P. Jenkins, Kansas City, Kan., for the petitioner.
Beatrice Rosenberg, Washington, D.C., for the respondent.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
The question presented by this case calls for interpretation of the Federal Bank Robbery Act. 18 U.S.C. § 2113, 18 U.S.C.A. § 2113.1 That statute creates and defines several crimes incidental to and related to thefts from banks organized or insured under federal laws. Included are bank robbery and entering a bank with intent to commit a robbery.2 We must decide here whether unlawful entry and robbery are two offenses consecutively punishable in a typical bank robbery situation.
2
Petitioner entered the Malone State Bank, in Malone, Texas, through an open door and during regular banking hours. He asked for and received certain directions. Thereupon he displayed a revolver, intimidating a bank employee and putting his life in jeopardy, and thus consummated a robbery. A grand jury returned a two-count indictment against him. The first charged the robbery offense; the second, entering the bank with the intent to commit a felony. Petitioner was convicted on both counts, and the district judge sentenced him to 20 years for robbery and 15 years for entering. The sentences were directed to be served consecutively. Some years thereafter, petitioner filed a 'Motion to Vacate or Correct Illegal Sentence.' The District Court, treating it as a proceeding under Rule 35 of the Federal Rules of Criminal Procedure, denied relief without conducting a hearing. The Court of Appeals for the Fifth Circuit affirmed. 230 F.2d 568.
3
Whether the crime of entering a bank with intent to commit a robbery is merged with the crime of robbery when the latter is consummated has puzzled the courts for several years. A conflict has arisen between the circuits.3 We granted certiorari because of the recurrence of the question and to resolve the conflict. 351 U.S. 962, 76 S.Ct. 1034, 100 L.Ed. 1482. In addition to the Court of Appeals cases on the precise question, both petitioner and the Government cite as analogous other cases that involved fragmentation of crimes for purposes of punishment.4 None of these is particularly helpful to us because we are dealing with a unique statute of limited purpose and an inconclusive legislative history. It can and should be differentiated from similar problems in this general filed raised under other statutes. The question of interpretation is a narrow one, and our decision should be correspondingly narrow.
4
The original Bank Robbery Act was passed in 1934. 48 Stat. 783. It covered only robbery, robbery accompanied by an aggravated assault, and homicide perpetrated in committing a robbery or escaping thereafter. In 1937 the Attorney General requested that the Act be amended. In his letter proposing the bill, the Attorney General declared that 'incongruous results' had developed under the existing law. He cited as a striking instance the case of
5
'* * * a man (who) was arrested in a national bank while walking out of the building with $11,000 of the bank's funds on his person. He had managed to gain possession of the money during a momentary absence of one of the employees, without displaying any force or violence and without putting anyone in fear—necessary elements of the crime of robbery—and was about to leave the bank when apprehended. As a result, it was not practicable to prosecute him under any Federal statute.'
6
The Act was amended accordingly to add other crimes less serious than robbery. Two larceny provisions were enacted: one for thefts of property exceeding $50, the other for lesser amounts. Congress further made it a crime to
7
'* * * enter or attempt to enter any bank * * *, with intent to commit in such bank or building, or part thereof, so used, any felony or larceny * * *.'
8
Robbery, entering and larceny were all placed in one paragraph of the 1937 Act.5
9
Congress provided for maximum penalties of either a prison term or a fine or both for each of these offenses. Robbery remained punishable by 20 years and $5,000. The larceny penalties were set according to the degree of the offense. Simple larceny could result in 1 year in jail and $1,000 fine, while the maximum for the more serious theft was set at 10 years and $5,000. No separate penalty clause was added for the crime of unlawfully entering. It was simply incorporated into the robbery provision.6
10
The Government asks us to interpret this statute as amended to make each a completely independent offense. It is unnecessary to do so in order to vindicate the apparent purpose of the amendment. The only factor stressed by the Attorney General in his letter to Congress was the possibility that a thief might not commit all the elements of the crime of robbery. It was manifestly the purpose of Congress to establish lesser offenses. But in doing so there was no indication that Congress intended also to pyramid the penalties.
11
The Attorney General cited the situation of larceny to illustrate his position. It is highly unlikely that he would have wanted to have the offender given 10 years for the larceny plus 20 years for entering the bank with intent to steal. There is no reason to suppose that he wished to have the maximum penalty for robbery doubled by the imposition of 20 years for the robbery to which could be added 20 years for entering the bank.7 Nor is there anything in the reports of the House of Representatives or the Senate or the floor debates to warrant such a reading of the statute.8
12
It is a fair inference from the wording in the Act, uncontradicted by anything in the meager legislative history, that the unlawful entry provision was inserted to cover the situation where a person enters a bank for the purpose of committing a crime, but is frustrated for some reason before completing the crime. The gravamen of the offense is not in the act of entering, which satisfies the terms of the statute even if it is simply walking through an open, public door during normal business hours.9 Rather the heart of the crime is the intent to steal. This mental element merges into the completed crime if the robbery is consummated. To go beyond this reasoning would compel us to find that Congress intended, by the 1937 amendment, to make drastic changes in authorized punishments. This was cannot do. If Congress had so intended, the result could have been accomplished easily with certainty rather than by indirection.10
13
We hold, therefore, that when Congress made either robbery or an entry for that purpose a crime it intended that the maximum punishment for robbery should remain at 20 years,11 but that, even if the culprit should fall short of accomplishing his purpose, he could be imprisoned for 20 years for entering with the felonious intent.
14
While reasonable minds might differ on this conclusion, we think it is consistent with our policy of not attributing to Congress, in the enactment of criminal statutes, an intention to punish more severely than the language of its laws clearly imports in the light of pertinent legislative history.
15
The judgment of the Court of Appeals is reversed and the case is remanded to the District Court for the purpose of resentencing the petitioner in accordance with this opinion.
16
Reversed and remanded.
17
Mr. Justice BURTON dissents for the reasons stated in the opinion of the Court of Appeals, 5 Cir., 230 F.2d 568.
18
Mr. Justice BLACK took no part in the consideration or decision of this case.
1
'(a) Whoever, by force and violence, or by intimidation, takes, or attempts to take, from the person or presence of another any property or money or any other thing of value belonging to, or in the care, custody, control, management, or possession of, any bank, or any savings and loan association; or
'Whoever enters or attempts to enter any bank, or any savings and loan association, or any building used in whole or in part as a bank, or as a savings and loan association, with intent to commit in such bank, or in such savings and loan association, or building, or part thereof, so used, any felony affecting such bank or such savings and loan association and in violation of any statute of the United States, or any larceny—
'Shall be fined not more than $5,000 or imprisoned not more than twenty years, or both.
'(b) Whoever takes and carries away, with intent to steal or purloin, any property or money or any other thing of value exceeding $100 belonging to, or in the care, custody, control, management, or possession of any bank, or any savings and loan association, shall be fined not more than $5,000 or imprisoned not more than ten years, or both; or
'Whoever takes and carries away, with intent to steal or purloin, any property or money or any other thing of value not exceeding $100 belonging to, or in the care, custody, control, management, or possession of any bank, or any savings and loan association, shall be fined not more than $1,000 or imprisoned not more than one year, or both.
'(d) Whoever, in committing, or in attempting to commit, any offense defined in subsections (a) and (b) of this section, assaults any person, or puts in jeopardy the life of any person by the use of a dangerous weapon or device, shall be fined not more than $10,000 or imprisoned not more than twenty-five years, or both.'
2
As used in this opinion, 'robbery' and 'larceny' refer not to the common-law crimes, but rather to the analogous offenses in the Bank Robbery Act.
3
In accord with the decision of the Fifth Circuit is its own earlier ruling in Durrett v. United States, 107 F.2d 438, and Rawls v. United States, 162 F.2d 798, decided by the Tenth Circuit. Another decision of the Fifth Circuit affirmed consecutive sentences for robbery and entering with intent to commit robbery. Wells v. United States, 124 F.2d 334. However, the prisoner, appearing pro se, had not raised a question of merger of these offenses in that proceeding. When he tried to do so later, the court held that he was barred on the ground that he was making a second motion under 28 U.S.C. § 2255, 28 U.S.C.A. § 2255, for similar relief on behalf of the same prisoner. Wells v. United States, 210 F.2d 112. Finally he sought remedy by writ of habeas corpus, but the Ninth Circuit concluded that the earlier § 2255 proceedings precluded jurisdiction. Madigan v. Wells, 224 F.2d 577, reversing Wells v. Swope, D.C., 121 F.Supp. 718.
Contrary to the Fifth and Tenth Circuits are determinations of the Sixth Circuit in Simunov v. United States, 162 F.2d 314, and a District Court in Wells v. Swope, supra. To the same effect are dicta in Ninth Circuit cases. Madigan v. Wells, supra, 224 F.2d at page 578; Barkdoll v. United States, 147 F.2d 617.
4
United States v. Michener, 331 U.S. 789, 67 S.Ct. 1509, 91 L.Ed. 1818; United States v. Raynor, 302 U.S. 540, 58 S.Ct. 353, 82 L.Ed. 413; Blockburger v. United States, 284 U.S. 299, 52 S.Ct. 180, 76 L.Ed. 306; United States v. Adams, 281 U.S. 202, 50 S.Ct. 269, 74 L.Ed. 807; Albrecht v. United States, 273 U.S. 1, 47 S.Ct. 250, 71 L.Ed. 505; Morgan v. Devine, 237 U.S. 632, 35 S.Ct. 712, 59 L.Ed. 1153; Gavieres v. United States, 220 U.S. 338, 31 S.Ct. 421, 55 L.Ed. 489; Burton v. United States, 202 U.S. 344, 26 S.Ct. 688, 50 L.Ed. 1057; Carter v. McClaughry, 183 U.S. 365, 22 S.Ct. 181, 46 L.Ed. 236. See also Bell v. United States, 349 U.S. 81, 75 S.Ct. 620, 99 L.Ed. 905; United States v. Universal C.I.T. Credit Corp., 344 U.S. 218, 73 S.Ct. 227, 97 L.Ed. 260; Ebeling v. Morgan, 237 U.S. 625, 35 S.Ct. 710, 59 L.Ed. 1151; United States v. Daugherty, 269 U.S. 360, 46 S.Ct. 156, 70 L.Ed. 309.
5
This appeared in 12 U.S.C. (1946 ed.) § 588b(a). The statute in its present form was enacted by the June 1948 revision. 18 U.S.C. § 2113(a), 18 U.S.C.A. § 2113(a). The legislative history indicates that no substantial change was made in this revision. It segregated the larceny provisions in § 2113(b), leaving robbery and unlawful entry in § 2113(a). See note 1, supra.
6
The Bank Robbery Act has, since it was passed in 1934, contained a special provision for increased punishment for aggravated offenses. One who, in committing robbery, assaults and person or puts the life of any person in jeopardy by the use of a dangerous weapon can be sentenced to 25 years in jail or fined $10,000 or both. When the Act was amended in 1937 to add larceny and unlawful entry, these were incorporated in the same paragraph with robbery and thus made subject to the increased penalty under aggravating circumstances. This provision currently is found in 18 U.S.C. § 2113(d), 18 U.S.C.A. § 2113(d). See note 1, supra.
7
Under the government view, if carried to its logical extreme, one who enters a bank and commits a robbery could be sentenced to 20 years for robbery, 10 years for larceny and 20 years for unlawful entry. The Government conceded that this was error in Heflin v. United States, 5 Cir., 223 F.2d 371 (robbery and larceny). However, it now declares that its confession of error was made by mistake and that larceny and rebbery are separate offenses, cumulatively punishable.
8
H.R.Rep. No. 732, 75th Cong., 1st Sess.; S.Rep. No. 1259, 75th Cong., 1st Sess.; 81 Cong.Rec. 2731, 4656, 5376—5377, 9331.
9
This distinguishes the unlawful entry provision in the Bank Robbery Act from a very similar provision relating to post-office offenses. 18 U.S.C. § 2115, 18 U.S.C.A. § 2115:
'Whoever forcibly breaks into or attempts to break into any post office, or any building used in whole or in part as a post office, with intent to commit in such post office, or building, or part thereof, so used, any larceny or other depredation, shall be fined * * *.' (Italics supplied.)
This section was held to create an offense separate from a completed post-office theft. Morgan v. Devine, 237 U.S. 632, 35 S.Ct. 712, 59 L.Ed. 1153.
10
Further evidence that Congress was concerned only with proscribing additional activities and not with alteration of the scheme of penalties is revealed by the form in which the bill was cast. Introduced in the House of Representatives, the proposal merely interjected into the robbery provision clauses making larceny and entering criminal. H.R. 5900, 75th Cong., 1st Sess.; H.R.Rep. No. 732, 75th Cong., 1st Sess. 2. All three would have made violators subject to the existing penalty clause. During the debate on the floor, Rep. Wolcott pointed to the incongruity of establishing degrees of larceny without corresponding discrimination in punishment. 81 Cong.Rec. 4656. The Committee on the Judiciary then amended the bill to provide for punishments related to the larceny offenses. 81 Cong.Rec. 5376—5377. The Senate accepted the House version without debate. 81 Cong.Rec. 9331; see S.Rep. No. 1259, 75th Cong., 1st Sess.
11
In this case, petitioner was convicted of robbery aggravated by assault with a deadly weapon and was subject to the maximum of 25 years provided in 18 U.S.C. § 2113(d), 18 U.S.C.A. § 2113(d). See note 6, supra.
| 01
|
352 U.S. 445
77 S.Ct. 390
1 L.Ed.2d 456
William RADOVICH, Petitioner,v.NATIONAL FOOTBALL LEAGUE, Bert Bell, J. Rufus Klawans, et al.
No. 94.
Argued Jan. 17, 1957.
Decided Feb. 25, 1957.
Rehearing Denied April 8, 1957.
See 353 U.S. 931, 77 S.Ct. 716.
Mr. Maxwell Keith, San Francisco, Cal., for the petitioner.
Mr. Philip Elman, Washington, D.C., for the United States, as amicus curiae.
Messrs. Marshall E. Leahy, San Francisco, Cal., and Bernard I. Nordlinger, Washington, D.C., for the respondents.
Mr. Justice CLARK delivered the opinion of the Court.
1
This action for treble damages and injunctive relief, brought under § 4 of the Clayton Act,1 tests the application of the antitrust laws to the business of professional football. Petitioner Radovich, an all-pro guard formerly with the Detroit Lions, contends that the respondents2 entered into a conspiracy to monopolize and control organized professional football in the United States, in violation of §§ 1 and 2 of the Sherman Act;3 that part of the conspiracy was to destroy the All-America Conference, a competitive professional football league in which Radovich once played; and that pursuant to agreement, respondents boycotted Radovich and prevented him from becoming a player-coach in the Pacific Coast League. Petitioner alleges that respondents' illegal conduct damaged him in the sum of $35,000, to be trebled as provided by the Act. The trial court, on respondents' motion, dismissed the cause for lack of jurisdiction and failure to state a claim on which relief could be granted. The Court of Appeals affirmed, 9 Cir., 231 F.2d 620, on the basis of Federal Base Ball Club of Baltimore v. National League, 1922, 259 U.S. 200, 42 S.Ct. 465, 66 L.Ed. 898, and Toolson v. New York Yankees, Inc., 1953, 346 U.S. 356, 74 S.Ct. 78, 98 L.Ed. 64, applying the baseball rule to all 'team sports.' It further found that even if such application was erroneous and that United States v. International Boxing Club, 1955, 348 U.S. 236, 75 S.Ct. 259, 99 L.Ed. 290, applied, Radovich had not grounded his claim on conduct of respondents which was 'calculated to prejudice the public or unreasonably restrain interstate commerce.' 231 F.2d at page 623. We granted certiorari, 352 U.S. 818, 77 S.Ct. 34, in order to clarify the application of the Toolson doctrine and determine whether the business of football comes within the scope of the Sherman Act. For the reasons hereafter stated we conclude that Toolson and Federal Base Ball do not control; that the respondents' activities as alleged are within the coverage of the antitrust laws; and that the complaint states a cause of action thereunder.
I.
2
Since the complaint was dismissed its allegations must be taken by us as true. It is, therefore, important for us to consider what Radovich alleged. Concisely the complaint states that:
3
1. Radovich began his professional football career in 1938 when he signed with the Detroit Lions, a National League Club. After four seasons of play he entered the Navy, returning, to the Lions for the 1945 season. In 1946 he asked for a transfer to a National League club in Los Angeles because of the illness of his father. The Lions refused the transfer and Radovich broke his player contract by signing with and playing the 1946 and 1947 seasons for the Los Angeles Dons, a member of the All-America Conference.4 In 1948 the San Francisco Clippers, a member of the Pacific Coast League which was affiliated with but not a competitor of the National League, offered to employ Radovich as a player-coach. However, the National League advised that Radovich was blacklisted and any affiliated club signing him would suffer severe penalties. The Clippers then refused to sign him in any position. This black-listing effectively prevented his employment in organized professional football in the United States.
4
2. The black-listing was the result of a conspiracy among the respondents to monopolize commerce in professional football among the States. The purpose of the conspiracy was to 'control, regulate and dictate the terms upon which organized professional football shall be played throughout the United States' in violation of §§ 1 and 2 of the Sherman Act. It was part of the conspiracy to boy-cott the All-America Conference and its players with a view to its destruction and thus strengthen the monopolistic position of the National Football League.
5
3. As part of its football business, the respondent league and its member teams schedule football games in various metropolitan centers, including New York, Chicago, Philadelphia, and Los Angeles. Each team uses a standard player contract which prohibits a player from signing with another club without the consent of the club holding the player's contract. These contracts are enforced by agreement of the clubs to black-list any player violating them and to visit severe penalties on recalcitrant member clubs. As a further 'part of the business of professional football itself' and 'directly tied in and connected' with its football exhibitions is the transmission of the games over radio and television into nearly every State of the Union. This is accomplished by contracts which produce a 'significant portion of the gross receipts' and without which 'the business of operating a professional football club would not be profitable.' The playing of the exhibitions themselves 'is essential to the interstate transmission by broadcasting and television' and the actions of the respondents against Radovich were necessarily related to these interstate activities.
6
In the light of these allegations respondents raise two issues: They say the business of organized professional football was not intended by Congress to be included within the scope of the antitrust laws; and, if wrong in this contention, that the complaint does not state a cause of action upon which relief can be granted.
II.
7
Respondents' contention, boiled down, is that agreements similar to those complained of here, which have for many years been used in organized baseball, have been held by this Court to be outside the scope of the antitrust laws.5 They point to Federal Base Ball and Toolson, supra, both involving the business of professional baseball, asserting that professional football has embraced the same techniques which existed in baseball at the time of the former decision.6 They contend that stare decisis compels the same result here. True, the umbrella under which respondents hope to stand is not so large as that contended for in United States v. International Boxing Club, supra, nor in United States v. Shubert, 1955, 348 U.S. 222, 75 S.Ct. 277, 99 L.Ed. 279. There we were asked to extend Federal Base Ball to boxing and the theater. Here respondents say that the contracts and sanctions which baseball and football find it necessary to impose have no counterpart in other businesses and that, therefore, they alone are outside the ambit of the Sherman Act. In Toolson we continued to hold the umbrella over baseball that was placed there some 31 years earlier by Federal Base Ball. The Court did this because it was concluded that more harm would be done in overruling Federal Base Ball than in upholding a ruling which at best was of dubious validity. Vast efforts had gone into the development and organization of baseball since that decision and enormous capital had been invested in reliance on its permanence. Congress had chosen to make no change.7 All this, combined with the flood of litigation that would follow its repudiation, the harassment that would ensue, and the retroactive effect of such a decision, led the Court to the practical result that it should sustain the unequivocal line of authority reaching over many years.
8
The Court was careful to restrict Toolson's coverage to baseball, following the judgment of Federal Base Ball only so far as it 'determines that Congress had no intention of including the business of baseball within the scope of the federal antitrust laws.' Supra, 346 U.S. at page 357, 74 S.Ct. at page 79. The Court reiterated this in United States v. Shubert, supra, 348 U.S. at page 230, 75 S.Ct. at page 282, where it said, 'In short, Toolson was a narrow application of the rule of stare decisis.' And again, in International Boxing Club, it added, 'Toolson neither overruled Federal Baseball nor necessarily reaffirmed all that was said in Federal Baseball. * * * Toolson is not authority for exempting other businesses merely because of the circumstance that they are also based on the performance of local exhibitions.' Supra, 348 U.S. at page 242, 75 S.Ct. at page 262. Furthermore, in discussing the impact of the Federal Baseball decision, the Court made the observation that that decision 'could not be relied upon as a basis of exemption for other segments of the entertainment business, athletic or otherwise. * * * The controlling consideration in Federal Baseball * * * was * * * the degree of interstate activity involved in the particular business under review.' Id., 348 U.S. at pages 242—243, 75 S.Ct. at page 262. It seems that this language would have made it clear that the Court intended to isolate these cases by limiting them to baseball, but since Toolson and Federal Base Ball are still cited as controlling authority in antitrust actions involving other fields of business, we now specifically limit the rule there established to the facts there involved, i.e., the business of organized professional baseball. As long as the Congress continues to acquiesce we should adhere to—but not extend—the interpretation of the Act made in those cases. We did not extend them to boxing or the theater because we believed that the volume of interstate business in each—the rationale of Federal Base Ball—was such that both activities were within the Act. Likewise, the volume of interstate business involved in organized professional football places it within the provisions of the Act.
9
If this ruling is unrealistic, inconsistent, or illogical, it is sufficient to answer, aside from the distinctions between the businesses,8 that were we considering the question of baseball for the first time upon a clean slate we would have no doubts. But Federal Base Ball held the business of baseball outside the scope of the Act. No other business claiming the coverage of those cases has such an adjudication. We, therefore, conclude that the orderly way to eliminate error or discrimination, if any there be, is by legislation and not by court decision. Congressional processes are more accommodative, affording the whole industry hearings and an opportunity to assist in the formulation of new legislation. The resulting product is therefore more likely to protect the industry and the public alike. The whole scope of congressional action would be known long in advance and effective dates for the legislation could be set in the future without the injustices of retroactivity and surprise which might follow court action. Of course, the doctrine of Toolson and Federal Base Ball must yield to any congressional action and continues only at its sufferance. This is not a new approach. See Davis v. Department of Labor, 1942, 317 U.S. 249, 255, 63 S.Ct. 225, 228, 87 L.Ed. 246;9 compare Rutkin v. United States, 1952, 343 U.S. 130, 72 S.Ct. 571, 96 L.Ed. 833.
III.
10
We now turn to the sufficiency of the complaint. At the outset the allegations of the nature and extent of interstate commerce seem to be sufficient. In addition to the standard allegations, a specific claim is made that radio and television transmission is a significant, integral part of the respondents' business, even to the extent of being the difference between a profit and a loss. Unlike International Boxing, the complaint alleges no definite percentage in this regard. However, the amount must be substantial and can easily be brought out in the proof. If substantial, as alleged, it alone is sufficient to meet the commerce requirements of the Act. See International Boxing, supra, 348 U.S. at page 241, 75 S.Ct. at page 261.
11
Likewise, we find the technical objections to the pleading without merit. The test as to sufficiency laid down by Mr. Justice Holmes in Hart v. B. F. Keith Vaudeville Exchange, 262 U.S. 271, 274, 43 S.Ct. 540, 541, 67 L.Ed. 977 (1923), is whether 'the claim is wholly frivolous.' While the complaint might have been more precise in its allegations concerning the purpose and effect of the conspiracy, 'we are not prepared to say that nothing can be extracted from this bill that falls under the act of Congress * * *.' Id., 262 U.S. at page 274, 43 S.Ct. at page 541. See also United States v. Employing Plasterers Ass'n, 1954, 347 U.S. 186, 74 S.Ct. 452, 98 L.Ed. 618.
12
Petitioner's claim need only be 'tested under the Sherman Act's general prohibition on unreasonable restraints of trade,' Times-Picayune Publishing Co. v. United States, 1953, 345 U.S. 594, 614, 73 S.Ct. 872, 883, 97 L.Ed. 1277, and meet the requirement that petitioner has thereby suffered injury. Congress has, by legislative fiat, determined that such prohibited activities are injurious to the public10 and has provided sanctions allowing private enforcement of the antitrust laws by an aggrieved party. These laws protect the victims of the forbidden practices as well as the public. Mandeville Island Farms, Inc., v. American Crystal Sugar Co., 1948, 334 U.S. 219, 236, 68 S.Ct. 996, 1006, 92 L.Ed. 1328. Furthermore, Congress itself has placed the private antitrust litigant in a most favorable position through the enactment of § 5 of the Clayton Act.11 Emich Motors Corp. v. General Motors Corp., 1951, 340 U.S. 558, 71 S.Ct. 408, 95 L.Ed. 534. In the face of such a policy this Court should not add requirements to burden the private litigant beyond what is specifically set forth by Congress in those laws.
13
Respondents' remaining contentions we believe to be lacking in merit.
14
We think that Radovich is entitled to an opportunity to prove his charges. Of course, we express no opinion as to whether or not respondents have, in fact, violated the antitrust laws, leaving that determination to the trial court after all the facts are in.
15
Reversed.
16
Mr. Justice FRANKFURTER, dissenting.
17
The difficult problem in this case derives for me not out of the Sherman Law but in relation to the appropriate compulsion of stare decisis. It does not derive from the Sherman Law because the most conscientious probing of the text and the interstices of the Sherman Law fails to disclose that Congress, whose will we are enforcing excluded baseball—the conditions under which that sport is carried on—from the scope of the Sherman Law but included football. I say this, fully aware that the Sherman Law's applicability turns on the particular circumstances of activities pursued in trade and commerce among the several States. But whether the conduct of an enterprise is within or without the limits of the Sherman Law is, after all, a question for judicial determination, and conscious as I am of my limited competence in matters athletic, I have yet to hear of any consideration that led this Court to hold that 'the business of providing public baseball games for profit between clubs of professional baseball players was not within the scope of the federal antitrust laws,' Toolson v. New York Yankees, 346 U.S. 356, 357, 74 S.Ct. 78, 98 L.Ed. 64, that is not equally applicable to football.
18
But considerations pertaining to stare decisis do raise a serious question for me. That principle is a vital ingredient of law, for it 'embodies an important social policy.' Helvering v. Hallock, 309 U.S. 106, 119, 60 S.Ct. 444, 451, 84 L.Ed. 604. It would disregard the principle for a judge stubbornly to persist in his views on a particular issue after the contrary had become part of the tissue of the law. Until then, full respect for stare decisis does not require a judge to forego his own convictions promptly after his brethren have rejected them.
19
The considerations that governed me two years ago in United States v. International Boxing Club, 348 U.S. 236, 75 S.Ct. 259, 99 L.Ed. 290, have not lost their force by reason of the authority that time gives to a single decision. And so I am confronted with the Toolson case, supra, which guides me to find the present situation within its scope, and the Boxing case, supra, which, while it looks the other way, left Toolson as a living authority. Respect for the doctrine of stare decisis does not yet require me to disrespect the views I expressed in the Boxing case.
20
I would affirm.
21
Mr. Justice HARLAN, with whom Mr. Justice BRENNAN joins, dissenting.
22
What was foreshadowed by United States v. International Boxing Club, 348 U.S. 236, 75 S.Ct. 259, 99 L.Ed. 290, has now come to pass. The Court, in holding that professional football is subject to the antitrust laws, now says in effect that professional baseball is sui generis so far as those laws are concerned, and that therefore Federal Base Ball Club of Baltimore v. National League, 259 U.S. 200, 42 S.Ct. 465, 66 L.Ed. 898, and Toolson v. New York Yankees, Inc., 346 U.S. 356, 74 S.Ct. 78, 98 L.Ed. 64, do not control football by reason of stare decisis. Since I am unable to distinguish football from baseball under the rationale of Federal Base Ball and Toolson, and can find no basis for attributing to Congress a purpose to put baseball in a class by itself, I would adhere to the rule of stare decisis and affirm the judgment below.
23
If the situation resulting from the baseball decisions is to be changed, I think it far better to leave it to be dealt with by Congress than for this Court to becloud the situation further, either by making untenable distinctions between baseball and other professional sports, or by discriminatory fiat in favor of baseball.
1
38 Stat. 731, 15 U.S.C. § 15, 15 U.S.C.A. § 15, reads as follows:
§ 4. That any person who shall be injured in his business or property by reason of anything forbidden in the antitrust laws may sue therefor in any district court of the United States in the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the cost of suit, including a reasonable attorney's fee.'
Injunctive relief is provided for by 38 Stat. 737, 15 U.S.C. § 26, 15 U.S.C.A. § 26.
2
The respondents include the National Football League; its 10 member clubs at the time the complaint was filed: Boston Yanks, New York Giants, Philadelphia Eagles, Los Angeles Rams, Pittsburgh Steelers, Washington Redskins, Chicago Bears, Chicago Cardinals, Detroit Lions, and Green Bay Packers; the now defunct pacific Coast League; the San Francisco Clippers, a member of the Pacific Coast League; Bert Bell, Commissioner of the National Football League; and J. Rufus Klawans, Commissioner of the Pacific Coast League.
3
26 Stat. 209, 15 U.S.C. § 1, 15 U.S.C.A. § 1, reads in pertinent part:
§ 1. Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States * * * is declared to be illegal * * *.'
26 Stat. 209, 15 U.S.C. § 2, 15 U.S.C.A. § 2, reads in pertinent part:
§ 2. Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States * * * shall be deemed guilty of a misdemeanor * * *.'
4
This Conference operated from 1946 through 1949 at which time it was disbanded.
5
No contention is made that the business of professional football has any specific exemption from the antitrust laws.
6
Since this action was dismissed on the pleadings, there has been no factual determination establishing the claimed similarity between the businesses of baseball and football.
7
Congress did consider the extension of the baseball rule to other sports. In 1951 four separate bills were introduced to exempt organized professional sports from the antitrust laws. None of them were enacted. See H.R. 4229, 4230, 4231, and S. 1526, 82d Cong., 1st Sess. 1951.
8
Consideration of basic differences, if any, between the baseball and football businesses, such as the football draft system, use of league affiliations, training facilities and techniques, etc., is not necessary to this decision.
9
The concurring opinion uses this language: 'Such a desirable end cannot now be achieved merely by judicial repudiation of the Jensen doctrine. (Southern Pac. Co. v. Jensen, 244 U.S. 205, 37 S.Ct. 524.)' 317 U.S. at page 259, 63 S.Ct. at page 230.
10
In Apex Hosiery Co. v. Leader, 1940, 310 U.S. 469, 60 S.Ct. 982, 84 L.Ed. 1311, this Court said: 'The end sought was the prevention of restraints to free competition in business and commercial transactions which tended to restrict production, raise prices or otherwise control the market to the detriment of purchasers or consumers of goods and services, all of which had come to be regarded as a special form of public injury.' (Emphasis supplied.) Id., 310 U.S. at page 493, 60 S.Ct. at page 992. In Standard Sanitary Mfg. Co. v. United States, 1912, 226 U.S. 20, 33 S.Ct. 9, 57 L.Ed. 107, speaking of the antitrust laws, the Court said: 'The law is its own measure of right and wrong, of what it permits or forbids, and the judgment of the courts cannot be set up against it in a supposed accommodation of its policy with the good intention of parties, and, it may be, of some good results.' (Emphasis supplied.) Id., 226 U.S. at page 49, 33 S.Ct. at page 15.
11
38 Stat. 731, 15 U.S.C. § 16, 15 U.S.C.A. § 16, declares that a final judgment against a defendant in proceedings by the Government for violation of the antitrust laws may be introduced by a private litigant in a subsequent treble damage action and establishes prima facie a violation of the antitrust laws.
| 78
|
352 U.S. 407
77 S.Ct. 397
1 L.Ed.2d 430
UNITED STATES of America, Appellant,v.James Vernon TURLEY.
No. 289.
Argued Jan. 24, 1957.
Decided Feb. 25, 1957.
Mr. Roger D. Fisher, Washington, D.C., for the appellant.
Mr. Fenton L. Martin, Baltimore, Md., for the appellee.
Mr. Justice BURTON delivered the opinion of the Court.
1
This case concerns the meaning of the word 'stolen' in the following provision of the National Motor Vehicle Theft Act, commonly known as the Dyer Act:
2
'Whoever transports in interstate or foreign commerce a motor vehicle or aircraft, knowing the same to have been stolen, shall be fined not more than $5,000 or imprisoned not more than five years, or both.'1
3
The issue before us is whether the meaning of the word 'stolen,' as used in this provision, is limited to a taking which amounts to common-law larceny, or whether it includes an embezzlement or other felonious taking with intent to deprive the owner of the rights and benefits of ownership. For the reasons hereafter stated, we accept the broader interpretation.
4
In 1956, an information based on this section was filed against James Vernon Turley in the United States District Court for the District of Maryland. It charged that Turley, in South Carolina, lawfully obtained possession of an automobile from its owner for the purpose of driving certain of their friends to the homes of the latter in South Carolina, but that, without permission of the owner and with intent to steal the automobile, Turley converted it to his own use and unlawfully transported it in interstate commerce to Baltimore, Maryland, where he sold it without permission of the owner.2 The information thus charged Turley with transporting the automobile in interstate commerce knowing it to have been obtained by embezzlement rather than by common-law larceny.
5
Counsel appointed for Turley moved to dismiss the information on the ground that it did not state facts sufficient to constitute an offense against the United States. He contended that the word 'stolen' as used in the Act referred only to takings which constitute common-law larceny and that the acts charged did not. The District Court agreed and dismissed the information. 141 F.Supp. 527. The United States concedes that the facts alleged in the information do not constitute common-law larceny, but disputes the holding that a motor vehicle obtained by embezzlement is not 'stolen' within the meaning of the Act. The Government appealed directly to this Court under 18 U.S.C. § 3731, 18 U.S.C.A. § 3731 because the dismissal was based upon a construction of the statute upon which the information was founded. We noted probable jurisdiction. 352 U.S. 816, 77 S.Ct. 65, 1 L.Ed.2d 44.
6
Decisions involving the meaning of 'stolen' as used in the National Motor Vehicle Theft Act did not arise frequently until comparatively recently. Two of the earlier cases interpreted 'stolen' as meaning statutory larceny as defined by the State in which the taking occurred.3 The later decisions rejected that interpretation but divided on whether to give 'stolen' a uniformly narrow meaning restricted to common-law larceny, or a uniformly broader meaning inclusive of embezzlement and other felonious takings with intent to deprive the owner of the rights and benefits of ownership.4 The Fifth, Eighth and Tenth Circuits favored the narrow definition,5 while the Fourth, Sixth and Ninth Circuits favored the broader one.6 We agree that in the absence of a plain indication of an intent to incorporate diverse state laws into a federal criminal statute, the meaning of the federal statute should not be dependent on state law. See Jerome v. United States, 1943, 318 U.S. 101, 104, 63 S.Ct. 483, 485, 87 L.Ed. 640; United States v. Handler, 2 Cir., 1944, 142 F.2d 351, 354.
7
We recognize that where a federal criminal statute uses a common-law term of established meaning without otherwise defining it, the general practice is to give that term its common-law meaning.7 But 'stolen' (or 'stealing') has no accepted common-law meaning. On this point the Court of Appeals for the Fourth Circuit recently said:
8
'But while 'stolen' is constantly identified with larceny, the term was never at common law equated or exclusively dedicated to larceny. 'Steal' (originally 'stale') at first denoted in general usage a taking through secrecy, as implied in 'stealth,' or through stratagem, according to the Oxford English Dictionary. Expanded through the years, it became the generic designation for dishonest acquisition, but it never lost its initial connotation. Nor in law is 'steal' or 'stolen' a word of art. Blackstone does not mention 'steal' in defining larceny—'the felonious taking and carrying away of the personal goods of another'—or in expounding its several elements. IV Commentaries 229 et seq.' Boone v. United States, 4 Cir., 1956, 235 F.2d 939, 940.
9
Webster's New International Dictionary (2d ed., 1953) likewise defines 'stolen' as 'Obtained or accomplished by theft, stealth, or craft * * *.' Black's Law Dictionary (4th ed., 1951) states that 'steal' 'may denote the criminal taking of personal property either by larceny, embezzlement, or false pretenses.'8 Furthermore, 'stolen' and 'steal' have been used in federal criminal statutes, and the courts interpreting those words have declared that they do not have a necessary common-law meaning coterminous with larceny and exclusive of other theft crimes.9 Freed from a common-law meaning, we should give 'stolen' the meaning consistent with the context in which it appears.
10
'That criminal statutes are to be construed strictly is a proposition which calls for the citation of no authority. But this does not mean that every criminal statute must be given the narrowest possible meaning in complete disregard of the purpose of the legislature.' United States v. Bramblett, 1955, 348 U.S. 503, 509—510, 75 S.Ct. 504, 508, 99 L.Ed. 594; see also, United States v. Sullivan, 1948, 332 U.S. 689, 893 694, 68 S.Ct. 331, 334, 92 L.Ed. 297.
11
It is, therefore, appropriate to consider the purpose of the Act and to gain what light we can from its legislative history.
12
By 1919, the law of most States against local theft had developed so as to include not only common-law larceny but embezzlement, false pretenses, larceny by trick, and other types of wrongful taking. The advent of the automobile, however, created a new problem with which the States found it difficult to deal. The automobile was uniquely suited to felonious taking whether by larceny, embezzlement or false pretenses. It was a valuable, salable article which itself supplied the means for speedy escape. 'The automobile (became) the perfect chattel for modern large-scale theft.'10 This challenge could be best met through use of the Federal Government's jurisdiction over interstate commerce. The need for federal action increased with the number, distribution and speed of the motor vehicles until, by 1919, it became a necessity.11 The result was the National Motor Vehicle Theft Act.
13
This background was reflected in the Committee Report on the bill presented by its author and sponsor, Representative Dyer. H.R.Rep. No. 312, 66th Cong., 1st Sess. This report, entitled 'Theft of Automobiles,' pointed to the increasing number of automobile thefts, the resulting financial losses, and the increasing cost of automobile theft insurance. It asserted that state laws were inadequate to cope with the problem because the offenders evaded state officers by transporting the automobiles across state lines where associates received and sold them. Throughout the legislative hisoty Congress used the word 'stolen' as synonymous with 'theft,' a term generally considered to be broader than 'commonlaw larceny.'12 To be sure, the discussion referred to 'larceny' but nothing was said about excluding other forms of 'theft.' The report stated the object of the Act in broad terms, primarily emphasizing the need for the exercise of federal powers.13 No mention is made of a purpose to distinguish between different forms of theft, as would be expected if the distinction had been intended.14
14
'Larceny' is also mentioned in Brooks v. United States, 1925, 267 U.S. 432, 45 S.Ct. 345, 346, 69 L.Ed. 699.15 This reference, however, carries no necessary implication excluding the taking of automobiles by embezzlement or false pretenses. Public and private rights are violated to a comparable degree whatever label is attached to the felonious taking. A typical example of common-law larceny is the taking of an unattended automobile. But an automobile is no less 'stolen' because it is rented, transported interstate, and sold without the permission of the owner (embezzlement).16 The same is true where an automobile is purchased with a worthless check, transported interstate, and sold (false pretenses).17 Professional thieves resort to innumerable forms of theft and Congress presumably sought to meet the need for federal action effectively rather than to leave loopholes for wholesale evasion.18
15
We conclude that the Act requires an interpretation of 'stolen' which does not limit it to situations which at common law would be considered larceny. The refinements of that crime are not related to the primary congressional purpose of eliminating the interstate traffic in unlawfully obtained motor vehicles. The Government's interpretation is neither unclear nor vague. 'Stolen' as used in 18 U.S.C. § 2312, 18 U.S.C.A. § 2312 includes all felonious takings of motor vehicles with intent to deprive the owner of the rights and benefits of ownership, regardless of whether or not the theft constitutes common-law larceny.
16
Reversed and remanded.
17
Mr. Justice FRANKFURTER, whom Mr. Justice BLACK and Mr. Justice DOUGLAS join, dissenting.
18
If Congress desires to make cheating, in all its myriad varieties, a federal offense when employed to obtain an automobile that is then taken across a state line, it should express itself with less ambiguity than by language that leads three Courts of Appeals to decide that it has not said so and three that it has. If 'stealing' (describing a thing as 'stolen') be not a term of art, it must be deemed a colloquial, everyday term. As such, it would hardly be used, even loosely, by the man in the street to cover 'cheating.' Legislative drafting is dependent on treacherous words to convey, as often as not, complicated ideas, and courts should not be pedantically exacting in construing legislation. But to sweep into the jurisdiction of the federal courts the transportation of cars obtained not only by theft but also by trickery does not present a problem so complicated that the Court should search for hints to find a command. When Congress has wanted to deal with many different ways of despoiling another of his property and not merely with larceny, it has found it easy enough to do so, as a number of federal enactments attest. See, e.g., 18 U.S.C. §§ 641, 655, 659, 1707, 18 U.S.C.A. §§ 641, 655, 659, 1707. No doubt, penal legislation should not be artificially restricted so as to allow escape for those for whom it was with fair intendment designed. But the principle of lenity which should guide construction of criminal statutes, Bell v. United States, 349 U.S. 81, 83—84, 75 S.Ct. 620, 622, 99 L.Ed. 905, precludes extending the term 'stolen' to include every form of dishonest acquisition. This conclusion is encouraged not only by the general consideration governing the construction of penal laws; it also has regard for not bringing to the federal courts a mass of minor offenses that are local in origin until Congress expresses, if not an explicit, at least an unequivocal, desire to do so.
19
I would affirm the judgment.
1
18 U.S.C. § 2312, 18 U.S.C.A. § 2312. The original Act, sponsored by Representative L. C. Dyer of Missouri, became law in 1919. 41 Stat. 324. It was amended, in 1945, to include aircraft, 59 Stat. 536, and was re-enacted, in 1948, as part of the Criminal Code, 62 Stat. 806.
2
As amended, the information charged that—
'On or about January 20, 1956, at Columbia, South Carolina,
JAMES VERNON TURLEY
did lawfully obtain a certain 1955 Ford automobile from its owner, Charles T. Shaver, with permission of said owner to use the automobile briefly on that day to transport certain of their friends to the homes of the latter in Columbia, South Carolina, and to return with them, but after so obtaining the automobile and transporting said persons to their homes, and before returning with them or delivering back the automobile to its owner, James Vernon Turley, without permission of the owner, and with intent in South Carolina to steal the 1955 Ford automobile, did convert the same to his own use and did unlawfully transport it in interstate commerce from Columbia, South Carolina, to Baltimore in the State and District of Maryland, knowing it to have been stolen, where he did on January 21, 1956, sell said 1955 Ford automobile without permission of the owner.'
3
Carpenter v. United States, 8 Cir., 1940, 113 F.2d 692; Abraham v. United States, 8 Cir., 1926, 15 F.2d 911. The Abraham case arose in Oklahoma, where larceny was defined by statute in the narrow common-law sense, and the conviction was reversed because the taking did not meet that test. The Carpenter case arose in Minnesota, where the statutory definition of larceny included embezzlement and other types of fraudulent taking, and the conviction was affirmed.
4
In this opinion felonious is used in the sense of having criminal intent rather than with reference to any distinction between felonies and misdemeanors.
5
Murphy v. United States, 5 Cir., 1953, 206 F.2d 571 (false pretenses); Ackerson v. United States, 8 Cir., 1950, 185 F.2d 485 (false pretenses); Hite v. United States, 10 Cir., 1948, 168 F.2d 973 (false pretenses). Cf. Hand v. United States, 10 Cir., 1955, 227 F.2d 794 (larceny by bailee); and Stewart v. United States, 8 Cir., 1945, 151 F.2d 386 (larceny by bailee). See also, United States v. Kratz, D.C.Neb.1951, 97 F.Supp. 999 (embezzlement); United States v. O'Carter, D.C.S.D.Iowa 1949, 91 F.Supp. 544 (false pretenses); Ex parte Atkinson, D.C.E.D.S.C.1949, 84 F.Supp. 300 (false pretenses).
6
Boone v. United States, 4 Cir., 1956, 235 F.2d 939 (false pretenses); Smith v. United States, 9 Cir., 1956, 233 F.2d 744 (embezzlement); Breece v. United States, 6 Cir., 1954, 218 F.2d 819 (embezzlement); Wilson v. United States, 6 Cir., 1954, 214 F.2d 313 (embezzlement); Collier v. United States, 6 Cir., 1951, 190 F.2d 473 (embezzlement); Davilman v. United States, 6 Cir., 1950, 180 F.2d 284 (embezzlement). And see United States v. Sicurella, 2 Cir., 1951, 187 F.2d 533, 534, where the court said that 'a narrow common law definition (of 'stolen') is not required under the Dyer Act.'
'Most of these cases adopted the definition of 'stolen' given by Judge Shackelford Miller, Jr., in United States v. Adcock, D.C.W.D.Ky.1943, 49 F.Supp. 351, 353 (embezzlement):
'* * * the word 'stolen' is used in the statute not in the technical sense of what constitutes larceny, but in its well known and accepted meaning of taking the personal property of another for one's own use without right or law, and that such a taking can exist whenever the intent to do so comes into existence and is deliberately carried out regardless of how the party so taking the car may have originally come into possession of it.'
7
United States v. Carll, 1882, 105 U.S. 611, 26 L.Ed. 1135; United States v. Smith, 1820, 5 Wheat. 153, 5 L.Ed. 57; United States v. Brandenburg, 3 Cir., 1944, 144 F.2d 656, 154 A.L.R. 1160.
8
In defining 'theft' Webster's New International Dictionary (2d ed. 1953) says: 'Stealing and theft, esp. in popular use, are broader terms than larceny, and may include swindling as well as embezzlement.'
'The term 'theft,' sometimes used as a synonym of larceny, is in reality a broader term, applying to all cases of depriving another of his property whether by removing or withholding it, and includes larceny, robbery, cheating, embezzlement, breach of trust, etc.' 13 Encyclopaedia Britannica, Larceny (1953), 720. And see 2 Bouvier's Law Dictionary (3d rev. ed. 1914) 3267.
9
See, e.g., United States v. O'Connell, 2 Cir., 1948, 165 F.2d 697, 698 ('steal' or 'unlawfully take by any fraudulent device, scheme, or game' from dining car moving in interstate commerce); United States v. De Normand, 2 Cir., 1945, 149 F.2d 622, 624 (interstate transportation of goods 'stolen, feloniously converted or taken feloniously by fraud or with intent to steal or purloin', 53 Stat. 1178); United States v. Handler, 2 Cir., 1944, 142 F.2d 351, 353 (same); Crabb v. Zerbst, 5 Cir., 1938, 99 F.2d 562, 565 ('embezzle, steal, or purloin' property of the United States, 35 Stat. 1097, § 47); United States v. Trosper, D.C.S.D.Cal.1904, 127 F. 476, 477 ('steal' from the mails); United States v. Jolly, D.C.W.D.Tenn.1888, 37 F. 108 ('steal' from the mails); United States v. Stone, C.C.W.D.Tenn.1881, 8 F. 232 ('plunders, steals, or destroys' goods belonging to a vessel in distress).
10
Hall, Theft, Law and Society (2d ed. 1952), 235, and see 233—240; 58 Cong.Rec. 5470—5478.
11
In 1895, there were four automobiles in the United States and, in 1910, about 500,000. Hall, op. cit. 234 et seq. In 1919, there were nearly 6,500,000. H.R.Rep. No. 312, 66th Cong., 1st Sess. 2—3. Today, there are over 65,000,000 motor vehicle registrations. World Almanac (1957) 699.
12
See note 8, supra.
13
The report began and ended as follows:
'The Congress of the United States can scarcely enact any law at this session that is more needed than the bill herein recommended, and that has for its purpose the providing of severe punishment of those guilty of the stealing of automobiles in interstate or foreign commerce. * * * State laws upon the subject have been inadequate to meet the evil. Thieves steal automobiles and take them from one State to another and oft-times have associates in this crime who receive and sell the stolen machines. * * *
'The purpose of the proposed law is to suppress crime in interstate commerce. Automobiles admittedly are tangible property, capable of being transmitted in interstate commerce. The larceny of automobiles is made a crime under the laws of all the States in the Union. No good reason exists why Congress, invested with the power to regulate commerce among the several States, should not provide that such commerce should not be polluted by the carrying of stolen property from one State to another. Congress is the only power competent to legislate upon this evil, and the purpose of this bill is to crush it, with the penalties attached.' Id., at 1, 4, See also, 58 Cong.Rec. 5470—5478, 6433—6435.
14
In 1948, following the decision in Hite v. United States, 10 Cir., 168 F.2d 973, holding that the word 'stolen' was restricted to common-law larceny, the Department of Justice proposed various clarifying amendments to 18 U.S.C. § 2312, 18 U.S.C.A. § 2312. These amendments sought to clarify the application of the Act by adding the words 'embezzled, feloniously converted, or taken feloniously by fraud,' or similar language. Such an amendment was adopted by one House of Congress in each of the 81st, 83d and 84th Congresses, but in each case it failed to come to a vote in the other House. Appellee seeks support for his interpretation of 'stolen' in the failure of Congress to enact these proposals, but we think this failure is entitled to no significance. The proposed amendments are shown by their respective Committee Reports to be clarifying amendments. They included other proposed changes and were never voted down. See S. 1483, 81st Cong., 1st Sess. (S.Rep. No. 358); S. 675, 83d Cong., 2d Sess. (S.Rep. No. 2364); and H.R. 3702, 84th Cong., 1st Sess. (H.R.Rep. No. 919).
15
In that case Chief Justice Taft, after referring to the purpose of Congress in passing the Act 'to devise some method for defeating the success of these widely spread schemes of larceny,' did not further discuss larceny but said:
'The quick passage of the machines into another state helps to conceal the trail of the thieves, gets the stolen property into another police jurisdiction and facilitates the finding of a safer place in which to dispose of the booty at a good price. This is a gross misuse of interstate commerce. Congress may properly punish such interstate transportation by any one with knowledge of the theft because of its harmful result and its defeat of the property rights of those whose machines against their will ar e taken into other jurisdictions.' Id., 267 U.S. at pages 438—439, 45 S.Ct. at page 346.
16
See Smith v. United States, 9 Cir., 1956, 233 F.2d 744; Hand v. United States, 10 Cir., 1955, 227 F.2d 794; Stewart v. United States, 8 Cir., 1945, 151 F.2d 386; Clark and Marshall, Crimes (5th ed. 1952), 428—451, 482—503; Annotation, Distinction between larceny and embezzlement, 146 A.L.R. 532.
A car rental situation was involved in Davilman v. United States, 6 Cir., 1950, 180 F.2d 284. Kindred situations were involved in Breece v. United States, 6 Cir., 1954, 218 F.2d 819; Wilson v. United States, 6 Cir., 1954, 214 F.2d 313; and Collier v. United States, 6 Cir., 1951, 190 F.2d 473. Another embezzlement situation, the use of an employee to obtain automobiles feloniously, was involved in United States v. Bucur, 7 Cir., 1952, 194 F.2d 297.
17
See Boone v. United States, 4 Cir., 1956, 235 F.2d 939; Murphy v. United States, 5 Cir., 1953, 206 F.2d 571; Ackerson v. United States, 8 Cir., 1950, 185 F.2d 485; Hite v. United States, 10 Cir., 1948, 168 F.2d 973. In each of these cases the defendant obtained possession of a car by passing a bad check, falsely representing that it would be paid.
18
For examples of other automobile theft devices, see Hall, Theft, Law and Society (2d ed. 1952), 252—253. For a history of common-law larceny and the development of other theft crimes, see id., at 1—109, and Hall and Glueck, Criminal Law and Enforcement (1951), 165—171.
| 01
|
352 U.S. 521
77 S.Ct. 457
1 L.Ed.2d 511
Henry FERGUSON, Petitioner,v.MOORE-McCORMACK LINES, Inc.
No. 59.
Argued Dec. 10, 1956.
Decided Feb. 25, 1957.
Mr. George J. Engelman, New York City, for the petitioner.
Mr. William A. Wilson, New York City, for the respondent.
Mr. Justice DOUGLAS announced the judgment of the Court and an opinion in which The CHIEF JUSTICE, Mr. Justice CLARK and Mr. Justice BRENNAN join.
1
Petitioner was injured in 1950 while serving as a second baker on respondent's passenger ship Brazil. Among his duties he was required to fill orders of the ship's waiters for ice cream. On the day of the accident, he had received an order from a ship's waiter for 12 portions of ice cream. When he got half way down in the two-and-one-half-gallon ice-cream container from which he was filling these orders, the ice cream was so hard that it could not be removed with the hemispherical scoop with which he had been furnished. Petitioner undertook to remove the ice cream with a sharp butcher knife kept nearby, grasping the handle and chipping at the hard ice cream. The knife struck a spot in the ice cream which was so hard that his hand slipped down onto the blade of the knife, resulting in the loss of two fingers of his right hand.
2
Petitioner brought this suit under the Jones Act, 41 Stat. 1007, 46 U.S.C. § 688, 46 U.S.C.A. § 688, to recover for his injuries which were alleged to be the result of respondent's negligence. At the close of petitioner's case, respondent's motion for a directed verdict was denied. Respondent offered no evidence. After the jury returned a verdict of $17,500 for the petitioner, respondent moved to set aside the verdict. This motion was also denied and judgment entered for the petitioner in accordance with the jury verdict. The Court of Appeals reversed, holding that it was 'not within the realm of reasonable foreseeability' that petitioner would use the knife to chip the frozen ice cream. 228 F.2d 891, 892. We granted certiorari. 351 U.S. 936, 76 S.Ct. 835, 100 L.Ed. 1464.
3
We conclude that there was sufficient evidence to take to the jury the question whether respondent was negligent in failing to furnish petitioner with an adequate tool with which to perform his task.
4
Petitioner testified that the hard ice cream could have been loosened safely with an ice chipper. He had used such an instrument for that purpose on other ships. He was not, however, furnished such an instrument. There was evidence that the scoop with which he had been furnished was totally inadequate to remove ice cream of the consistency of that which he had to serve. And, there was evidence that its extremely hard consistency was produced by the failure of another member of the crew to transfer it from the deep freeze to a tempering chest in sufficient time to allow all of it to become disposable by means of the scoop when the time came for it to be served. There was no showing that any device was close at hand which would have safely performed the task. Finally, there was evidence that petitioner had been instructed to give the waiters prompt service.
5
Respondent urges that it was not reasonably foreseeable that petitioner would utilize the knife to loosen the ice cream. But the jury, which plays a pre-eminent role in these Jones Act cases, Jacob v. City of New York, 315 U.S. 752, 62 S.Ct. 854, 88 L.Ed. 1166; Schulz v. Pennsylvania R. Co., 350 U.S. 523, 76 S.Ct. 608, 100 L.Ed. 668, could conclude that petitioner had been furnished no safe tool to perform his task. It was not necessary that respondent be in a position to foresee the exact chain of circumstances which actually led to the accident. The jury was instructed that it might consider whether respondent could have anticipated that a knife would be used to get out the ice cream. On this record, fair-minded men could conclude that respondent should have foreseen that petitioner might be tempted to use a knife to perform his task with dispatch, since no adequate implement was furnished him. See Schulz v. Pennsylvania R. Co., 350 U.S. 523, 526, 76 S.Ct. 608, 610, 100 L.Ed. 668. Since the standard of liability under the Jones Act is that established by Congress under the Federal Employers' Liability Act, 45 U.S.C.A. § 51 et seq., what we said in Rogers v. Missouri Pacific R. Co., 352 U.S. 500, 77 S.Ct. 443, is relevant here:
6
'Under this statute the test of a jury case is simply whether the proofs justify with reason the conclusion that employer negligence played any part, even the slightest, in producing the injury or death for which damages are sought.'
7
Because the jury could have so concluded, the Court of Appeals erred in holding that respondent's motion for a directed verdict should have been granted. 'Courts should not assume that in determining these questions of negligence juries will fall short of a fair performance of their constitutional function.' Wilkerson v. McCarthy, 336 U.S. 53, 62, 69 S.Ct. 413, 418, 93 L.Ed. 497.
8
Reversed.
9
Mr. Justice BURTON concurs in the result.
10
Mr. Justice REED would affirm the judgment of the Court of Appeals.
11
Mr. Justice BLACK took no part in the consideration or decision of this case.
12
For dissenting opinions of Mr. Justice FRANKFURTER and Mr. Justice HARLAN, see 352 U.S. 518, 77 S.Ct. 459.
13
Mr. Justice FRANKFURTER, dissenting.
14
'The Federal Employers' Liability Act gives to railroad employees a somewhat liberalized right of recovery for injuries on the job. A great number of cases under the Act have been brought to the Supreme Court, many of them cases in which the court of appeals had set aside, on the evidence, verdicts for the employees. Despite the human appeal of these cases, Brandeis never allowed himself to regard them as the proper business of the appellate jurisdiction of the Supreme Court.'
15
Paul A. Freund, The Liberalism of Justice Brandeis, address at a meeting of the American Historical Association in St. Louis, December 28, 1956.
16
In so discharging his judicial responsibility, Mr. Justice Brandeis did not disclose an idiosyncrasy in a great judge. His attitude expressed respect for the standards formulated by the Court in carrying out the mandate of Congress regarding this Court's appellate jurisdiction in cases arising under the Federal Employers' Liability Act, 45 U.S.C.A. § 51 et seq. For he began his work on the Court1 just after Congress had passed the Act of September 6, 1916, 39 Stat. 726, relieving the Court of its obligatory jurisdiction over Federal Employers' Liability Act decisions by the highest state courts and the Circuit Courts of Appeals. Mr. Justice Brandeis' general outlook on the formulation by the Supreme Court of the public law appropriate for an evolving society has more and more prevailed; his concept of the role of the Supreme Court in our judicial system, and his consequent regard for the bearing on the judicial product of what business comes to the Court and how the Court deals with it, have often been neglected in the name of 'doing justice' in individual cases. To him these were not technicalities, in the derogatory sense, for the conduct of judicial business. He deemed wise decisions on substantive law within the indispensable area of the Court's jurisdiction dependent on a limited volume of business and on a truly deliberative process.
17
One field of conspicuous disregard of these vital considerations is that large mass of cases under the Federal Employers' Liability Act in which the sole issue is the sufficiency of the evidence for submission to the jury.2 For many years, I reluctantly voted on the merits of these negligence cases that had been granted review. In the last ten years, and more particularly within the past few years, as the Court has been granting more and more of these petitions, I have found it increasingly difficult to acquiesce in a practice that I regard as wholly incompatible with the certiorari policy embodied in the 1916 Act, the Judiciary Act of 1925, 43 Stat. 936, and the Rules formulated by the Court to govern certiorari jurisdiction for its own regulation and for the guidance of the bar. I have therefore felt compelled to vote to dismiss petitions for certiorari in such cases as improvidently granted without passing on the merits.3 In these cases I indicated briefly the reasons why I believed that this Court should not be reviewing decisions in which the sole issue is the sufficiency of the evidence for submission to the jury. In view of the increasing number of these cases that have been brought here for review—this dissent is to four decisions of the Court—and in view of the encouragement thereby given to continuing resort to this Court, I deem it necessary to enlarge upon the considerations that have guided me in the conviction that writs in this class of cases are 'improvidently granted.'4
18
At the outset, however, I should deal briefly with a preliminary problem. It is sometimes said that the 'integrity of the certiorari process' as expressed in the 'rule of four' (that is, this Court's practice of granting certiorari on the vote of four Justices) requires all the Justices to vote on the merits of a case when four Justices have voted to grant certiorari and no new factor emerges after argument and deliberation. There are two reasons why there can be no such requirement. Last Term, for example, the Court disposed of 1,361 petitions for certiorari. With such a volume of certiorari business, not to mention the remainder of the Court's business, the initial decision to grant a petition for certiorari must necessarily be based on a limited appreciation of the issues in a case, resting as it so largely does on the partisan claims in briefs of counsel. See Furness, Withy & Co. v. Yang-Tsze Ins. Ass'n, 242 U.S. 430, 434, 37 S.Ct. 141, 142, 61 L.Ed. 409; Southern Power Co. v. North Carolina Public Service Co., 263 U.S. 508, 509, 44 S.Ct. 164, 165, 68 L.Ed. 413. The Court does not, indeed it cannot and should not try to, give to the initial question of granting or denying a petition the kind of attention that is demanded by a decision on the merits. The assumption that we know no more after hearing and deliberating on a case than after reading the petition for certiorari and the response is inadmissible in theory and not true in fact. Even an FELA case sometimes appears in quite a different light after argument than it appeared on the original papers. Surely this must be acknowledged regarding one of today's cases, No. 46, and see McCarthy v. Bruner, certiorari granted, 322 U.S. 718, 64 S.Ct. 1047, 88 L.Ed. 1558, certiorari dismissed, 323 U.S. 673, 65 S.Ct. 126, 89 L.Ed. 547. The course of argument and the briefs on the merits may disclose that a case appearing on the surface to warrant a writ of certiorari does not warrant it, see Layne & Bowler Corp. v. Western Well Works, Inc., 261 U.S. 387, 43 S.Ct. 422, 67 L.Ed. 712,5 or may reveal more clearly that the only thing in controversy is an appraisal of facts on which this Court is being asked to make a second guess, to substitute its assessment of the testimony for that of the court below.
19
But there is a more basic reason why the 'integrity of the certiorari process' does not require me to vote on the merits of these cases. The right of a Justice to dissent from an action of the Court is historic. Of course self-restraint should guide the expression of dissent. But dissent is essential to an effective judiciary in a democratic society, and especially for a tribunal exercising the powers of this Court. Not four, not eight, Justices can require another to decide a case that he regards as not properly before the Court. The failure of a Justice to persuade his colleagues does not require him to yield to their views, if he has a deep conviction that the issue is sufficiently important. Moreover, the Court operates ultimately by majority. Even though a minority may bring a case here for oral argument, that does not mean that the majority has given up its right to vote on the ultimate disposition of the case as conscience directs. This is not a novel doctrine. As a matter of practice, members of the Court have at various times exercised this right of refusing to pass on the merits of cases that in their view should not have been granted review.
20
This does not make the 'rule of four' a hollow rule. I would not change the practice. No Justice is likely to vote to dismiss a writ of certiorari as improvidently granted after argument has been heard, even though he has not been convinced that the case is within the rules of the Court governing the granting of certiorari. In the usual instance, a doubting Justice respects the judgment of his brethren that the case does concern issues important enough for the Court's consideration and adjudication. But a different situation is presented when a class of cases is systematically taken for review. Then a Justice who believes that such cases raise insignificant and unimportant questions—insignificant and unimportant from the point of view of the Court's duties—and that an increasing amount of the Court's time is unduly drained by adjudication of these cases cannot forego his duty to voice his dissent to the Court's action.
21
The 'rule of four' is not a command of Congress. It is a working rule devised by the Court as a practical mode of determining that a case is deserving of review, the theory being that if four Justices find that a legal question of general importance is raised, that is ample proof that the question has such importance. This is a fair enough rule of thumb on the assumption that four Justices find such importance on an individualized screening of the cases sought to be reviewed. The reason for deference to a minority view no longer holds when a class of litigation is given a special and privileged position.
22
The history of the Federal Employers' Liability Act reveals the continuing nature of the problem of review by this Court of the vast litigation under that Act in both the federal and state courts. The initial Federal Employers' Liability Act, 34 Stat. 232, was declared unconstitutional in the first Employers' Liability Cases (Howard v. Illinois Cent. R. Co.), 207, U.S. 463, 28 S.Ct. 141, 52 L.Ed. 297. The second Employers' Liability Act, 35 Stat. 65, drafted to meet the constitutional infirmity found in the first Act, was sustained in the Second Employers' Liability Cases (Mondou v. New York, N.H. & H.R. Co.), 223 U.S. 1, 32 S.Ct. 169, 56 L.Ed. 327. Under the general statutory scheme of review of litigation by the Supreme Court in force at that time, all cases arising under the Federal Employers' Liability Act, whether coming from the state or federal courts, were reviewable in the Supreme Court by writ of error, that is, as a matter of right. After the constitutionality of the Act had been sustained, cases began to flow to the Supreme Court and within a few years the Court was threatened with an avalanche of litigation under the Act. In the 1915 Term, the Court delivered opinions in 19 cases involving an assessment of the evidence to determine whether submission to the jury was warranted. See Appendices A and B, and starred footnote to Appendix A. 352 U.S. 548, 77 S.Ct. 472.
23
To relieve the Court of this burden of reviewing the large volume of insignificant litigation under the Federal Employers' Liability Act was one of the principal reasons for passage of the Act of September 6, 1916, 39 Stat. 726. See S.Rep. No. 775, 64th Cong., 1st Sess.; H.R.Rep. No. 794, 64th Cong., 1st Sess. In thus freeing the Court from unrestricted access to it of cases that have no business here, Congress assimilated Federal Employers' Liability Act litigation to those other categories of cases—e.g., diversity, patent, admiralty, criminal cases—that Congress had in 1891, 26 Stat. 826, 828, withdrawn from this Court's obligatory jurisdiction. Believing review in the state appellate systems or in the newly created Circuit Courts of Appeals sufficient, it made the lower courts' decisions final also in this class of litigation in all but the unusual cases raising significant legal questions. Thereafter such cases could be reviewed by the Supreme Court only on certiorari to 'secure uniformity of decision' between the Circuit Courts of Appeals and 'to bring up cases involving questions of importance which it is in the public interest to have decided by this court of last resort. The jurisdiction was not conferred upon this court merely to give the defeated party in the Circuit Court of Appeals another hearing. * * * These remarks, of course, apply also to applications for certiorari to review judgments and decrees of the highest courts of states.' Magnum Import Co. v. Coty, 262 U.S. 159, 163—164, 43 S.Ct. 531, 532—533, 67 L.Ed. 922. (See also Hamilton-Brown Shoe Co. v. Wolf Brothers & Co., 240 U.S. 251, 257—258, 36 S.Ct. 269, 271, 60 L.Ed. 629: certiorari jurisdiction 'is a jurisdiction to be exercised sparingly, and only in cases of peculiar gravity and general importance, or in order to secure uniformity of decision.') The statement for the Court by Mr. Chief Justice Taft in the Coty case indicates the strict criteria governing certiorari policy observed by the Court, except occasionally in FELA cases, previous to the Act of 1925, by which Congress put the Court's docket for all practical purposes in its own keeping. (For a more detailed history of the origin of certiorari jurisdiction, see Frankfurter and Landis, Business of The Supreme Court, cc. II, III, V, and VII.)
24
The vast extension of discretionary review by the Supreme Court on writ of certiorari contained in the Judges Bill of 1925, 43 Stat. 936, led the Court to promulgate formal rules, and not rely on admonitions in opinions, regarding conditions under which petitions for certiorari would be granted. The present Rule 19 of the Revised Rules of the Supreme Court, 28 U.S.C.A. contains the substance of the original Rule 35(5) of the Revised Rules of 1925, 266 U.S. 645, 681, and perhaps in view of the issue in these cases it is not unwarranted to set forth the full text of that rule:
25
'1. A review on writ of certiorari is not a matter of right, but of sound judicial discretion, and will be granted only where there are special and important reasons therefor. The following, while neither controlling nor fully measuring the court's discretion, indicate the character of reasons which will be considered:
26
'(a) Where a state court has decided a federal question of substance not theretofore determined by this court, or has decided it in a way probably not in accord with applicable decisions of this court.
27
'(b) Where a court of appeals has rendered a decision in conflict with the decision of another court of appeals on the same matter; or has decided an important state or territorial question in a way in conflict with applicable state or territorial law; or has decided an important question of federal law which has not been, but should be, settled by this court; or has decided a federal question in a way in conflict with applicable decisions of this court; or has so far departed from the accepted and usual course of judicial proceedings, or so far sanctioned such a departure by a lower court, as to call for an exercise of this court's power of supervision.
28
'2. The same general considerations outlined above will control in respect of petitions for writs of certiorari to review judgments of the Court of Claims, of the Court of Customs and Patent Appeals, or of any other court whose determinations are by law reviewable on writ of certiorari.'
29
Of course, cases raising questions that are not evidentiary, questions that fairly involve the construction or scope of the statute are appropriate for review here. See, e.g., Minneapolis & St. L.R. Co. v. Bombolis, 241 U.S. 211, 36 S.Ct. 595, 60 L.Ed. 961; Southern Pacific Co. v. Gileo, 351 U.S. 493, 76 S.Ct. 952, 100 L.Ed. 1357; Reed v. Pennsylvania R. Co., 351 U.S. 502, 76 S.Ct. 958, 100 L.Ed. 1366. But the ordinary negligence case under the Federal Employers' Liability Act does not satisfy the criteria that define the 'special and important reasons' when a writ of certiorari will be granted, and this may perhaps best be appreciated by summarizing the course of proceedings in each of the four cases now before us.
30
In No. 28, the petitioner brought suit for damages, alleging negligence on the part of respondent railroad in providing an unsafe place to work and an unsafe method for doing his work. Petitioner was engaged in burning weeds on respondent's right of way with a hand torch. He heard a whistle indicating an approaching train. He ran thirty to thirty-five yards along the track from the fire and, thinking himself far enough from the fire danger, stood near a drainage culvert watching the passing train for 'hotboxes.' The train caused the fire to come 'right up in (his) face.' Petitioner backed away with his arm over his face and fell down the incline of the culvert. There was considerable testimony concerning the circumstances of the accident, the methods of burning weeds, the duties of railroad workers, the condition of the right of way, in particular the condition of the culvert, and petitioner's knowledge of those conditions. Respondent's motions for a directed verdict at the close of petitioner's case and at the close of all the evidence were denied. The case was submitted to the jury, which returned a verdict for petitioner.
31
On appeal, the Missouri Supreme Court reversed. Rogers v. Thompson, Mo., 284 S.W.2d 467. Considering the evidence from a standpoint most favorable to the petitioner, it held that there was insufficient evidence of negligence on the part of respondent, and that even if there were sufficient evidence of negligence, there was no evidence to show that such negligence contributed to petitioner's injury.
32
In No. 42, petitioner brought suit for injuries suffered as a result of respondent railroad's alleged failure to use ordinary care in furnishing him with a reasonably safe place to work. There was little dispute over the circumstances of the accident, which are set forth in the opinion of the Court of Appeals for the Seventh Circuit, 228 F.2d 257, 258:
33
'Plaintiff had been employed by defendant in various capacities since about 1925 and was, on July 2, 1952, when the accident occurred, working as a brakeman, being assigned to the crew of a local freight run between the cities of East St. Louis and Clinton, Illinois. During the course of his duties, in a switching operation at Mount Olive, he noticed that a wheat car in the train was leaking. While the other crew members continued with the task of picking up cars to be incorporated into the train, he started back to the caboose to get some waste to plug the hole in the leaking car. He turned and, on the first step he took, tripped and fell with his left leg buckled under him. He thereby sustained a serious injury to his left kneecap. The accident occurred on the roadbed of defendant's 'house track' at a point about one foot from the end of the ties. After plaintiff fell, he looked to see what had caused him to fall and saw a clinker 'about the size of my fist' which was partly out of the ground, and a hole beside the clinker. * * * Plaintiff stated that he looked 'at the ground' before he stepped but did not see the clinker. He stated further that the footing on the roadbed looked level but was a little soft.'
34
Defendant's motions for a directed verdict at the close of petitioner's case and at the close of all the evidence were denied, and the jury returned a verdict for petitioner. The Court of Appeals reversed. It held that the possibility that 'defendant placed the clinker in its roadbed as a part of the ballast used in the repair operation is merely one of several possibilities present. A finding that it did so can rest on nothing but speculation.' The Court of Appeals also stated that 'there is a total want of evidence as to what constitutes reasonable prudence under the proved circumstances,' and that the record 'is equally lacking in evidence to prove that defendant had actual or constructive notice of the dangerous condition.' Id., at pages 259, 260.
35
In No. 46, petitioner appealed to the Court of Appeals for the Sixth Circuit from a directed verdict for respondent railroad. He gave the only testimony with respect to the accident and testified that, while the train was proceeding slowly, it made a sudden stop which threw him to the floor of the caboose where he was riding. The official report of the accident, which he signed, stated that the stop was made to avoid striking an automobile at a grade crossing. Petitioner gave some further testimony about the operation of air brakes, the frequency of emergency braking in his experience, and other methods of slowing down the train than by emergency braking. On this record, the Court of Appeals found a complete absence of probative facts to warrant submission of the case to the jury, and it affirmed the judgment of the District Court. 228 F.2d 902.
36
No. 59 was an appeal under the Jones Act, 41 Stat. 1007, 46 U.S.C. § 688, 46 U.S.C.A. § 688, whose standard of liability is explicitly that of the Federal Employers' Liability Act in this type of case; this case therefore presents the same problem for the Court as the other three. Petitioner had obtained a judgment, which was reversed by the Court of Appeals for the Second Circuit for failure of proof of negligence. The facts and reasons for reversal are set forth in the opinion of that court:
37
'Plaintiff was a baker engaged at the time of the accident in serving ice cream in the galley on C deck of defendant's §§ Brazil. Using the standard ice cream scoop provided for the purpose, plaintiff disposed of the contents of a half used tub and had worked his way about half way down a full additional tub. There he found the ice cream 'as hard as a brickbat,' and the scoop became useless. So it occurred to plaintiff that about a foot and a half from where he was serving and 'kept underneath the griddle' was a butcher knife, about eighteen inches long and as sharp as a razor, which might be used to chip the ice cream into small pieces. He was chipping away when his hand slipped and he was badly cut, resulting later in the loss of two fingers of his right hand.
38
'* * * The negligence (of defendant) is supposed to stem from a failure to provide a safe place to work and safe tools and appliances. Reliance is also placed upon the fact that plaintiff had been directed to fill the orders brought into the galley by the waiters and it is said that there must have been something wrong with the refrigeration system or the ice cream would not have been so hard.
39
'But no one in authority told plaintiff to use the butcher knife, which was customarily used in cutting French bread. The knife was properly in the galley and there was nothing defective about it. But it was never designed for or intended to be used as a dagger or ice pick for chipping frozen ice cream. And, that it would be put to such use was not within the realm of reasonable foreseeability. * * *
40
'There being no proof of fault on the part of the shipowner, defendant's motion for a directed verdict should have been granted.' 228 F.2d 891.
41
In all good conscience, what 'special and important' reason for granting certiorari do the facts in any one of these cases disclose? In three of them, the trial judge had allowed a case to go to the jury, and three unanimous reviewing courts—two Courts of Appeals and one state Supreme Court—had reversed for lack of evidence. In each of these cases, this Court has combed the record and found that there was sufficient evidence for the case to go to the jury, although in No. 28 the Court found evidence of negligence in the fact that '(c)ommon experience' teaches 'that a passing train will fan the flames of a fire,' 352 U.S. 503, 77 S.Ct. 447, whereas in No. 46 the Court found insufficiency of evidence to go to the jury because 'there is no evidence to show that unscheduled and sudden stops of trains are unusual or extraordinary occurrences.' 352 U.S. 520, 77 S.Ct. 456. In No. 46, the Court therefore affirms the judgment of the Court of Appeals, which had affirmed the direction of a verdict for defendant.
42
In any event, the Court in these four cases has merely reviewed evidence that has already been reviewed by two lower courts, and in so doing it ignores its own strictures to the bar that 'We do not grant a certiorari to review evidence and discuss specific facts.' United States v. Johnston, 268 U.S. 220, 227, 45 S.Ct. 496, 497, 69 L.Ed. 925. See also Houston Oil Co. v. Goodrich, 245 U.S. 440, 38 S.Ct. 140, 62 L.Ed. 385; Southern Power Co. v. North Carolina Public Service Co., 263 U.S. 508, 44 S.Ct. 164, 68 L.Ed. 413; General Talking Pictures Corp. v. Western Electric Co., 304 U.S. 175, 178, 58 S.Ct. 849, 851, 82 L.Ed. 1273. Constant complaints have been made by successive Chief Justices about the large number of frivolous petitions that are filed each Term, 'frivolous' meaning that the issues are not deserving of consideration for review when judged by the Court's instructions to the bar. See the remarks of Chief Justice Taft, in 35 Yale L.J. 1, 3, 4; Chief Justice Hughes, in 20 A.B.A.J. 341; Chief Justice Vinson, in 69 S.Ct. v, vi—vii. If the Court does not abide by its Rules, how can it expect the bar to do so? Standards must be enforced to be respected. If they are merely left as something on paper, they might as well be written on water.
43
The rule that the Court does not grant certiorari to review evidence is a wise rule, indeed indispensable to the work of the Court, and is as equally applicable to negligence cases as to any other type of case. Perhaps a word should be said about the basis of the cause of action under the Federal Employers' Liability Act. Liability under the Act is based on negligence.6 As far as the substantive cause of action is concerned, this is the historic cause of action for negligence as it has developed from the common law. It involves the same general concept on which is based every 'negligence case' in the state courts and in the multitudinous cases in the federal courts on diversity of citizenship in which the question is merely one of common-law negligence; that is, it is the familiar type of litigation that is part of the day-to-day business of state and federal trial judges.
44
The 1908 Act denied the railroads the benefit of certain common-law defenses and the 1939 amendment, 53 Stat. 1404, abolished the defense of assumption of risk, but the fact that a right to recover is not barred by what theretofore was a defense does not change the basis of the right. This has been recognized in the opinions of this Court in which it has reversed lower courts on the question of the sufficiency of the evidence. The Court has never intimated that the concept of negligence, undefined in the statute, has some special or esoteric content as used in the Act or is anything other than a statutory absorption of the common-law concept.7
45
'One's deep sympathy is of course aroused by a victim of the hazards of negligence litigation in situations like the one before us. But the remedy for an obsolete and uncivilized system of compensation for loss of life or limb of crews on ships and trains is not intermittent disregard of the considerations which led Congress to entrust this Court with the discretion of certiorari jurisdiction. The remedy is an adequate and effective system of workmen's compensation,' adequate in amount and especially prompt in administration. McAllister v. United States, 348 U.S. 19, 23—24, 75 S.Ct. 6, 9, 99 L.Ed. 20 (separate opinion). It deserves to be recorded that Professor John Chipman Gray, a legal scholar with social insight, taught his students fifty years ago, before the first workmen's compensation law had been enacted, that it is anachronistic to apply the common-law doctrine of negligence to injuries suffered by railroad employees rather than have society recognize such injuries as inevitable incidents of railroading and provide compensation on that basis. The persistence of this archaic and cruel system is attributable to many factors. Intertia of course. But also it is merely one illustration of the lag of reform because of the opposition of lawyers who resist change of the familiar, particularly when they have thriven under some outworn doctrine of law.8 Finally, one cannot acquit the encouragement given by this Court for seeking success in the lottery of obtaining heavy verdicts of contributing to the continuance of this system of compensation whose essential injustice can hardly be alleviated by the occasional 'correction' in this Court of ill-success.
46
Rather than paraphrase, I shall repeat what I have already said about negligence cases and certiorari policy in Wilkerson v. McCarthy, 336 U.S. 53, 64, 66, 69 S.Ct. 413, 418, 419: 'Considering the volume and complexity of the cases which obviously call for decision by this Court, and considering the time and thought that the proper disposition of such cases demands, I do not think we should take cases merely to review facts already canvassed by two and sometimes three courts even though those facts may have been erroneously appraised. The division in this Court would seem to demonstrate beyond peradventure that nothing is involved in this case except the drawing of allowable inferences from a necessarily unique set of circumstances. For this Court to take a case which turns merely on such an appraisal of evidence, however much hardship in the fallible application of an archaic system of compensation for injuries to railroad employees9 may touch our private sympathy, is to deny due regard to the considerations which led the Court to ask and Congress to give the power to control the Court's docket. Such power carries with it the responsibility of granting review only in cases that demand adjudication on the basis of importance to the operation of our federal system; importance of the outcome merely to the parties is not enough. * * *' See also Carter v. Atlanta & St. A.B.R. Co., 338 U.S. 430, 437, 70 S.Ct. 226, 230, 94 L.Ed. 236; McAllister v. United States, 348 U.S. 19, 23, 75 S.Ct. 6, 9.
47
The Court finds justification for granting certiorari in an alleged conflict of these decisions of the Courts of Appeals for the Second, Sixth, and Seventh Circuits and the Supreme Court of Missouri with the applicable decisions of this Court. All that can fairly be said is that these courts found that there was not evidence to bring these cases within the recognized rules for submitting a case to the jury. In none of them is there any intimation or atmospheric indication of unwillingness to enforce the governing rules of the Act as laid down by this Court. These rules are well known. That there should be differences of opinion in their application is almost inevitable.10 But once Congress in 1916 commanded that the ordinary Federal Employers' Liability Act case, like other essentially private Litigation, should reach a final decision in the Courts of Appeals or the state appellate tribunals, this Court should never have granted certiorari to assess the evidence in any of them.11 I would not continue a bad practice to aid a few plaintiffs because there was once a bad practice that aided a few defendants. One still does not commit two wrongs to 'do right.'
48
This is not the supreme court of review for every case decided 'unjustly' by every court in the country. The Court's practice in taking these Federal Employers' Liability Act cases discriminates against other personal injury cases, for example those in the federal courts on diversity jurisdiction. Similar questions of negligence are involved there and the opportunity for swallowing up more of the Supreme Court's energy is very great indeed. While 1,332 cases were commenced under the Federal Employers' Liability Act in the Federal District Courts in the fiscal year 1956 and 2,392 cases under the Jones Act, 11,427 personal injury cases were begun under the diversity jurisdiction in the District Courts. Annual Report of the Director of the Administrative Office of the United States Courts—1956, pp. 52—53. The Court may well have had this discrimination in mind when it granted certiorari in the diversity cases of Gibson v. Phillips Petroleum Co., 352 U.S. 874, 77 S.Ct. 16, 1 L.Ed.2d 77, and decided it on the merits. A few more such decisions and a flood of petitions from this source may confidently be expected. Whether or not it be true that we are a litigious people, it is a matter of experience that clients, if not lawyers, have a strong urge to exchaust all possibility of further appeal, particularly when judicially encouraged to do so. Disappointed litigants and losing lawyers like to have another go at it, and why should they not try when certiorari was granted in cases like these?
49
It is not enough, however, to deal with this problem on an abstract, theoretical basis. The statistical history of the Federal Employers' Liability Act, as set forth in the tables in the appendices to this opinion, gives concrete evidence of the recurring nature of the problem and the time-consuming nature of the litigation. In the early years of the Act, when review by this Court was on writ of error, there was a large number of cases in which sufficiency of evidence was at issue. Contrary to general belief, however, employees fared well in this type of case. Of the 42 cases decided by the Court raising that issue, a judgment for the plaintiff was reversed for evidentiary reasons in only three cases and a judgment for the defendant railroad upheld in only seven. In the other 32 cases, judgments for plaintiffs were affirmed or judgments for defendants reversed.
50
Once easy access to this Court was shut off by the discretionary power of review over these cases that was given to the Court in 1916, few FELA decisions were rendered, and only four, of which one was on writ of error, dealing with the sufficiency of the evidence, in the five-year period covered by the 1918 through the 1922 Terms. During the next ten years, however, the Court concerned itself more and more with the Act, but during this era the railroads tended to prevail. Thirty-five decisions were rendered from the 1923 Term through the 1932 Term. In 27 of these a judgment for a plaintiff was reversed for evidentiary reasons; in another the Court affirmed the reversal of a judgment for a plaintiff; and in another the Court reversed the reversal of a directed verdict for a railroad. (For a review of certiorari policy under the FELA during this period, see Frankfurter and Landis, Business of the Supreme Court at October Term, 1931, 46 Harv.L.Rev. 226, 240—253.)
51
Thereafter, during the remaining eight Terms of Mr. Chief Justice Hughes, the number of sufficiency-of-the-evidence cases under the Act that were granted review fell off considerably. Only seven decisions were rendered during that period. The next nine-year period, however, saw a large increase again, with 27 decisions during the 1941 through 1949 Terms. Unlike the previous experience with the Act, it was not efforts of railroads seeking to reverse judgments in favor of injured workers that constituted the major portion of the business during this period, but rather efforts by injured workers to upset judgments for railroads. And they were successful. Judgments for railroads were sustained in only four cases. In all the others, the Court reversed a judgment of a lower court that either had reversed a jury verdict for a plaintiff or had affirmed a judgment for a railroad.
52
In the following four Terms, business again slackened and only two cases concerning sufficiency of the evidence were decided under the Act. We now seem to have entered again on a period of renewed activity by the Court in this field. Two decisions were rendered in the 1954 Term, three in the 1955 Term, four thus far this Term, and two additional petitions for certiorari have already been granted this Term.
53
A further indication of the tendency in recent Court decisions is provided by a study of petitioners for certiorari in FELA cases from the 1938 through the 1954 Terms. This study disclosed that of the 260 petitions filed, sufficiency of the evidence of negligence or of causation for submission to the jury was the predominant question in 149. Seventy-eight of these petitions were filed by the employee and all of the 37 granted petitions were from this group, except one in which the writ was later dismissed as improvidently granted. McCarthy v. Bruner, certiorari granted, 322 U.S. 718, 64 S.Ct. 1047, 88 L.Ed. 1558, certiorari dismissed, 323 U.S. 673, 65 S.Ct. 126, 89 L.Ed. 547. Certiorari Policy in FELA Cases, 69 Harv.L.Rev. 1441, 1445—1446.
54
These figures tell only a small part of the story. While this opinion concerns itself principally with cases under the Federal Employers' Liability Act, the same kind of question arises under many other statutes. See footnote 2, supra. And experience leaves no doubt, though the fact cannot be established statistically, that by granting review in these cases, the Court encourages the filing of petitions for certiorari in other types of cases raising issues that likewise have no business to be brought here. Moreover, the considerations governing discharge of the Court's function involve only in part quantitative factors. Finally, and most important, granting review in one or two cases that present a compassionate appeal on this ground and one or two that present a compassionate appeal on that ground and one or two that present a compassionate appeal on a third ground inevitably makes that drain upon the available energy of the Court that is so inimical to the fullest investigation of, the amplest deliberation on, the most effective opinion-writing and the most critical examination of draft opinions in, the cases that have unquestioned claims upon the Court.
55
It is impossible to read the 106 written opinions of the Supreme Court dealing with this type of issue, see Appendices A and B, without feeling that during different periods the Court, while using the same generalities in speaking about the relation of judge and jury to the cause of action for negligence, has applied those principles differently from time to time to the facts of different cases. The divided views on this Court today with respect to the application of those principles merely reflect the divided views of state and federal judges throughout the country on problems of negligence. As long as there is a division of functions between judge and jury, there will be division of opinion concerning the correctness of trial judges' actions in individual cases. But since the law obviously does not remain 'settled' in this field very long, one does not have to be a prophet to be confident that the Court, if it continues its present certiorari policy, will one day return to its attitude of the 1920's in these individual cases. With a changed membership, the Court might tomorrow readily affirm all four of the cases that it decides today. There is nothing in the Federal Employers' Liability Act to say which view is correct. The Act expressed a social policy, and it expressed that policy in terms of a familiar, but elusively inapt, common-law cause of action. In is suggested in effect that the history of FELA litigation in this Court reveals a shift in mood, philosophy if one pleases, towards the Federal Employers' Liability Act— that at one time the chief concern may be lively regard for what are conceived to be unfair inroads upon the railroads' exchequer12 while at another period the preoccupation may be with protection of employees and their families, so far as money damages can do so, against the inherent hazards of their indispensable labor. Be that as it may, the desire to engraft a philosophy, either philosophy, upon an outmoded, unfair system of liability should not lead the Court to bend the rules by which it is governed in other cases in the exercise of its discretionary jurisdiction.
56
This unvarnished account of Federal Employers' Liability Act litigation in this Court relating to sufficiency of the evidence for submission of cases to the jury is surely not an exhilarating story. For the Supreme Court of the United States to spend two hours of solemn argument, plus countless other hours reading the briefs and record and writing opinions, to determine whether there was evidence to support an allegation that it could reasonably be foreseen that an ice-cream server on a ship would use a butcher's knife to scoop out ice cream that was too hard to be scooped with a regular scoop, is surely to misconceive the discretion that was entrusted to the wisdom of the Court for the control of its calendar. The Court may or may not be 'doing justice' in the four insignificant cases it decides today; it certainly is doing injustice to the significant and important cases on the calendar and to its own role as the supreme judicial body of the country.
57
It is, I believe, wholly accurate to say that the Court will be enabled to discharge adequately the vital, and, I feel the increasingly vital, responsibility it bears for the general welfare only if it restricts its reviewing power to the adjudication of constitutional issues or other questions of national importance, including therein settlement of conflict among the circuits. Surely its was this conviction, born of experience, that led the Court to ask of Congress that of the great mass of litigation in the state and federal courts only those cases shoud be allowed to be brought here that this Court deemed fit for review. Such as the jurisdictional policy accepted by Congress when it yielded to the Court's realization of the conditions necessary for its proper functioning.
58
For one thing, as the current United States Reports compared with those of even a generation ago amply prove, the types of cases now calling for decision to a considerable extent require investigation of voluminous literature far beyond the law reports and other legal writings. If it is to yield its proper significance, this vast mass of materials, often confused and conflicting, must be passed though the sieve of reflection. Judicial reflection is a process that requires time and freedom from the pressure of having more work to do than can be well done. It is not a bit of quixotism to believe that, of the 63 cases scheduled for argument during the remaining months of this Term, there are a half dozen that could alone easily absorb the entire thought of the Court for the rest of the Term.
59
The judgments of this Court are collective judgments. Such judgments are especially dependent on ample time for private study and reflection in preparation for discussion in Conference. Without adequate study, there cannot be adequate reflection; without adequate reflection, there cannot be adequate discussion; without adequate discussion, there cannot be that full and fruitful interchange of minds that is indispensable to wise decisions and persuasive opinions by the Court. Unless the Court vigorously enforces its own criteria for granting review of cases, it will inevitably face an accumulation of arrears or will dispose of its essential business in too hurried and therefore too shallow a way.
60
I would dismiss all four writs of certiorari as improvidently granted.
61
APPENDIX A.
62
Decisions Relating to Sufficiency of the Evidence Under the FELA, Term by Term.*
APPENDIX B.
63
Decisions Relating to Sufficiency of the Evidence Under the Federal Employers' Liability Act.
64
(* Indicates Summary Disposition Per Curiam.)
65
1911 Term.
66
Texas & P.R.Co. v. Howell, 224 U.S. 577, 32 S.Ct. 601, 56 L.Ed. 892; affirmance of judgment for plaintiff affirmed.
67
1912 Term.
68
Troxell v. Delaware, L. & W.R. Co., 227 U.S. 434, 33 S.Ct. 274, 57 L.Ed. 586; reversal of judgment for plaintiff reversed.
69
Norfolk & W.R. Co. v. Earnest, 229 U.S. 114, 33 S.Ct. 654, 57 L.Ed. 1096; judgment for plaintiff affirmed. 1913 Term.
70
Young v. Central R. Co. of N.J., 232 U.S. 602, 34 S.Ct. 451, 58 L.Ed. 750; remand for entry of judgment n.o.v. for defendant modified and affirmed.
71
Grand Trunk Western R. Co. v. Lindsay, 233 U.S. 42, 34 S.Ct. 581, 58 L.Ed. 838; affirmance of judgment for plaintiff affirmed.
72
Southern Railway-Carolina Division v. Bennett, 233 U.S. 80, 34 S.Ct. 566, 58 L.Ed. 860; affirmance of judgment for plaintiff affirmed.
73
Southern R. Co. v. Gadd, 233 U.S. 572, 34 S.Ct. 696, 58 L.Ed. 1099; affirmance of judgment for plaintiff affirmed.
74
1914 Term.
75
Yazoo & M.V.R. Co. v. Wright, 235 U.S. 376, 35 S.Ct. 130, 59 L.Ed. 277; affirmance of judgment for plaintiff affirmed.
76
McGovern v. Philadelphia & R.R. Co., 235 U.S. 389, 35 S.Ct. 127, 59 L.Ed. 283; directed verdict for defendant reversed.
77
Seaboard Air Line R. Co. v. Padgett, 236 U.S. 668, 35 S.Ct. 481, 59 L.Ed. 777; affirmance of judgment for plaintiff affirmed.
78
Central Vermont R. Co. v. White, 238 U.S. 507, 35 S.Ct. 865, 59 L.Ed. 1433; affirmance of judgment for plaintiff affirmed.
79
1915 Term.
80
Chicago, R.I. & P.R. Co. v. Devine, 239 U.S. 52, 36 S.Ct. 27, 60 L.Ed. 140; affirmance of judgment for plaintiff affirmed.
81
Seaboard Air Line R. Co. v. Koennecke, 239 U.S. 352, 36 S.Ct. 126, 60 L.Ed. 324; affirmance of judgment for plaintiff affirmed.
82
Reese v. Philadelphia & R.R. Co., 239 U.S. 463, 36 S.Ct. 134, 60 L.Ed. 384; affirmance of nonsuit affirmed.
83
Chicago, R.I. & P.R. Co. v. Wright, 239 U.S. 548, 36 S.Ct. 185, 60 L.Ed. 431; affirmance of judgment for plaintiff affirmed.
84
Kanawha & M.R. Co. v. Kerse, 239 U.S. 576, 36 S.Ct. 174, 60 L.Ed. 448; judgment for plaintiff affirmed.
85
Seaboard Air Line R. Co. v. Horton, 239 U.S. 595, 36 S.Ct. 180, 60 L.Ed. 458; affirmance of judgment for plaintiff affirmed.
86
Illinois Central R. Co. v. Skaggs, 240 U.S. 66, 36 S.Ct. 249, 60 L.Ed. 528; affirmance of judgment for plaintiff affirmed.
87
Great Northern R. Co. v. Wiles, 240 U.S. 444, 36 S.Ct. 406, 60 L.Ed. 732; reversal of judgment n.o.v. for defendant reversed.
88
Great Northern R. Co. v. Knapp, 240 U.S. 464, 36 S.Ct. 399, 60 L.Ed. 745; affirmance of judgment for plaintiff affirmed.
89
Jacobs v. Southern R. Co., 241 U.S. 229, 36 S.Ct. 588, 60 L.Ed. 970; affirmance of judgment for defendant affirmed.
90
Baughan v. New York, P. & N.R. Co., 241 U.S. 237, 36 S.Ct. 592, 60 L.Ed. 977; affirmance of judgment for defendant affirmed.
91
Louisville & N.R. Co. v. Stewart, 241 U.S. 261, 36 S.Ct. 586, 60 L.Ed. 989; affirmance of judgment for plaintiff affirmed.
92
Seaboard Air Line R. Co. v. Renn, 241 U.S. 290, 36 S.Ct. 567, 60 L.Ed. 1006; affirmance of judgment for plaintiff affirmed.
93
Chesapeake & O.R. Co. v. De Atley, 241 U.S. 310, 36 S.Ct. 564, 60 L.Ed. 1016; affirmance of judgment for plaintiff reversed.
94
Southern R. Co. v. Gray, 241 U.S. 333, 36 S.Ct. 558, 60 L.Ed. 1030; affirmance of judgment for plaintiff reversed.
95
Chesapeake & O.R. Co. v. Proffitt, 241 U.S. 462, 36 S.Ct. 620, 60 L.Ed. 1102; affirmance of judgment for plaintiff affirmed.
96
Chicago & N.W.R. Co. v. Bower, 241 U.S. 470, 36 S.Ct. 624, 60 L.Ed. 1107; affirmance of judgment for plaintiff affirmed.
97
San Antonio & A.P.R. Co. v. Wagner, 241 U.S. 476, 36 S.Ct. 626, 60 L.Ed. 1110; affirmance of judgment for plaintiff affirmed.
98
Spokane & I.E.R. Co. v. Campbell, 241 U.S. 497, 36 S.Ct. 683, 60 L.Ed. 1125; affirmance of judgment for plaintiff affirmed.
99
1916 Term.
100
Atlantic City R. Co. v. Parker, 242 U.S. 56, 37 S.Ct. 69, 61 L.Ed. 150; affirmance of judgment for plaintiff affirmed.
101
Baltimore & O.R. Co. v. Whitacre, 242 U.S. 169, 37 S.Ct. 33, 61 L.Ed. 228; affirmance of judgment for plaintiff affirmed.
102
St. Joseph & G.I.R. Co. v. Moore, 243 U.S. 311, 37 S.Ct. 278, 61 L.Ed. 741; affirmance of judgment for plaintiff affirmed.
103
New York Central & H.R. Co. v. Tonsellito, 244 U.S. 360, 37 S.Ct. 620, 61 L.Ed. 1194; affirmance of judgment for plaintiff affirmed.
104
Southern R. Co. v. Puckett, 244 U.S. 571, 37 S.Ct. 703, 61 L.Ed. 1321; affirmance of judgment for plaintiff affirmed.
105
Washington R. & Elec. Co. v. Scala, 244 U.S. 630, 37 S.Ct. 654, 61 L.Ed. 1360; affirmance of judgment for plaintiff affirmed.
106
1917 Term.
107
Boldt v. Pennsylvania R. Co., 245 U.S. 441, 38 S.Ct. 139, 62 L.Ed. 385; affirmance of judgment for defendant affirmed.
108
Union Pacific R. Co. v. Huxoll, 245 U.S. 535, 38 S.Ct. 187, 62 L.Ed. 455; affirmance of judgment for plaintiff affirmed.
109
Great Northern R. Co. v. Donaldson, 246 U.S. 121, 38 S.Ct. 230, 62 L.Ed. 616; affirmance of judgment for plaintiff affirmed.
110
Nelson v. Southern R. Co., 246 U.S. 253, 38 S.Ct. 233, 62 L.Ed. 699; reversal of judgment for plaintiff affirmed.
111
Union Pacific R. Co. v. Hadley, 246 U.S. 330, 38 S.Ct. 318, 62 L.Ed. 751; affirmance of judgment for plaintiff affirmed.
112
1918 Term.
113
Gillis v. New York, N.H. & H.R. Co., 249 U.S. 515, 39 S.Ct. 355, 63 L.Ed. 738; affirmance of directed verdict for defendant affirmed.
114
1919 Term.
115
Chicago, R.I. & P.R. Co. v. Ward, 252 U.S. 18, 40 S.Ct. 275, 64 L.Ed. 430; affirmance of judgment for plaintiff affirmed.
116
Boehmer v. Pennsylvania R. Co., 252 U.S. 496, 40 S.Ct. 409, 64 L.Ed. 680; affirmance of directed verdict for defendant affirmed.
117
1920 Term.
118
Southern Pacific Co. v. Berkshire, 254 U.S. 415, 41 S.Ct. 162, 65 L.Ed. 335; affirmance of judgment for plaintiff reversed.
119
1923 Term.
120
Frese v. Chicago, B. & Q.R. Co., 263 U.S. 1, 44 S.Ct. 1, 68 L.Ed. 131; reversal of judgment for plaintiff affirmed.
121
Davis v. Wolfe, 263 U.S. 239, 44 S.Ct. 64, 68 L.Ed. 284; affirmance of judgment for plaintiff affirmed.
122
Davis v. Matthews, 263 U.S. 686, 44 S.Ct. 179, 68 L.Ed. 506;* affirmance of judgment for plaintiff affirmed.
123
1924 Term.
124
Davis v. Kennedy, 266 U.S. 147, 45 S.Ct. 33, 69 L.Ed. 212; affirmance of judgment for plaintiff reversed.
125
Baltimore & O.R. Co. v. Groeger, 266 U.S. 521, 45 S.Ct. 169, 69 L.Ed. 419; affirmance of judgment for plaintiff reversed for new trial; evidence found sufficient for submission to jury.
126
1925 Term.
127
Minneapolis, St. P. & S.S.M.R. Co. v. Goneau, 269 U.S. 406, 46 S.Ct. 129, 70 L.Ed. 335; affirmance of judgment for plaintiff affirmed.
128
Chesapeake & O.R. Co. v. Nixon, 271 U.S. 218, 46 S.Ct. 495, 70 L.Ed. 914; affirmance of judgment for plaintiff reversed.
129
St. Louis-San Francisco R. Co. v. Mills, 271 U.S. 344, 46 S.Ct. 520, 70 L.Ed. 979; affirmance of judgment for plaintiff reversed.
130
Chicago, M. & St. P.R. Co. v. Coogan, 271 U.S. 472, 46 S.Ct. 564, 70 L.Ed. 1041; affirmance of judgment for plaintiff reversed.
131
1927 Term.
132
Atlantic Coast Line R. Co. v. Southwell, 275 U.S. 64, 48 S.Ct. 25, 72 L.Ed. 157; affirmance of judgment for plaintiff reversed.
133
Missouri Pacific R. Co. v. Aeby, 275 U.S. 426, 48 S.Ct. 177, 72 L.Ed. 351; affirmance of judgment for plaintiff reversed.
134
Gulf, M. & N. R. Co. v. Wells, 275 U.S. 455, 48 S.Ct. 151, 72 L.Ed. 370; affirmance of judgment for plaintiff reversed.
135
Toledo, St. L. & W.R. Co. v. Allen, 276 U.S. 165, 48 S.Ct. 215, 72 L.Ed. 513; affirmance of judgment for plaintiff reversed.
136
Kansas City Southern R. Co. v. Jones, 276 U.S. 303, 48 S.Ct. 308, 72 L.Ed. 583; affirmance of judgment for plaintiff reversed.
137
Chesapeake & O.R. Co. v. Leitch, 276 U.S. 429, 48 S.Ct. 336, 72 L.Ed. 638; affirmance of judgment for plaintiff reversed. 1928 Term.
138
Unadilla Valley R. Co. v. Caldine, 278 U.S. 139, 49 S.Ct. 91, 73 L.Ed. 224; affirmance of judgment for plaintiff reversed.
139
Western & A.R. Co. v. Hughes, 278 U.S. 496, 49 S.Ct. 231, 73 L.Ed. 473; affirmance of judgment for plaintiff affirmed.
140
Atlantic Coast Line R. Co. v. Tyner, 278 U.S. 565, 49 S.Ct. 35, 73 L.Ed. 508;* affirmance of judgment for plaintiff reversed.
141
Delaware, L. & W.R. Co. v. Koske, 279 U.S. 7, 49 S.Ct. 202, 73 L.Ed. 578; affirmance of judgment for plaintiff reversed.
142
Atlantic Coast Line R. Co. v. Davis, 279 U.S. 34, 49 S.Ct. 210, 73 L.Ed. 601; affirmance of judgment for plaintiff reversed.
143
Atlantic Coast Line R. Co. v. Driggers, 279 U.S. 787, 49 S.Ct. 490, 73 L.Ed. 957; affirmance of judgment for plaintiff reversed.
144
1929 Term.
145
Chesapeake & O.R. Co. v. Mihas, 280 U.S. 102, 50 S.Ct. 42, 74 L.Ed. 207; affirmance of judgment for plaintiff reversed.
146
New York Central R. Co. v. Ambrose, 280 U.S. 486, 50 S.Ct. 198, 74 L.Ed. 562; affirmance of judgment for plaintiff reversed.
147
New York Central R. Co. v. Marcone, 281 U.S. 345, 50 S.Ct. 294, 74 L.Ed. 892; affirmance of judgment for plaintiff affirmed.
148
Atchison, T. & S.F.R. Co. v. Toops, 281 U.S. 351, 50 S.Ct. 281, 74 L.Ed. 896; affirmance of judgment for plaintiff reversed.
149
1930 Term.
150
Atlantic Coast Line R. Co. v. Powe, 283 U.S. 401, 51 S.Ct. 498, 75 L.Ed. 1142; affirmance of judgment for plaintiff reversed.
151
1931 Term.
152
Chesapeake & O.R. Co. v. Kuhn, 284 U.S. 44, 52 S.Ct. 45, 76 L.Ed. 157; affirmance of judgment for plaintiff reversed.
153
Atchison, T. & S.F.R. Co. v. Saxon, 284 U.S. 458, 52 S.Ct. 229, 76 L.Ed. 397; affirmance of judgment for plaintiff reversed.
154
Missouri Pacific R. Co. v. David, 284 U.S. 460, 52 S.Ct. 242, 76 L.Ed. 399; affirmance of judgment for plaintiff reversed.
155
Atlantic Coast Line R. Co. v. Temple, 285 U.S. 143, 52 S.Ct. 334, 76 L.Ed. 670; affirmance of judgment for plaintiff reversed.
156
Southern R. Co. v. Youngblood, 286 U.S. 313, 52 S.Ct. 518, 76 L.Ed. 1124; affirmance of judgment for plaintiff reversed.
157
Southern R. Co. v. Dantzler, 286 U.S. 318, 52 S.Ct. 520, 76 L.Ed. 1127; affirmance of judgment for plaintiff reversed.
158
St. Louis S.W.R. Co. v. Simpson, 286 U.S. 346, 52 S.Ct. 520, 76 L.Ed. 1152; affirmance of judgment for plaintiff reversed.
159
1932 Term.
160
Rocco v. Lehigh Valley R. Co., 288 U.S. 275, 53 S.Ct. 343, 77 L.Ed. 743; reversal of judgment for plaintiff reversed.
161
Pennsylvania R. Co. v. Chamberlain, 288 U.S. 333, 53 S.Ct. 391, 77 L.Ed. 819; reversal of directed verdict for defendant reversed.
162
1933 Term.
163
Northwestern Pacific R. Co. v. Robo, 290 U.S. 499, 54 S.Ct. 263, 78 L.Ed. 462; affirmance of judgment for plaintiff reversed.
164
1934 Term.
165
Swinson v. Chicago, St. P., M. & O.R. Co., 294 U.S. 529, 55 S.Ct. 517, 79 L.Ed. 1041; directed verdict for defendant reversed.
166
1935 Term.
167
Chicago G.W.R. Co. v. Rambo, 298 U.S. 99, 56 S.Ct. 693, 80 L.Ed. 1066; affirmance of judgment for plaintiff reversed.
168
1938 Term.
169
Great Northern R. Co. v. Leonidas, 305 U.S. 1, 59 S.Ct. 51, 83 L.Ed. 3; affirmance of judgment for plaintiff affirmed.
170
1939 Term.
171
Keys v. Pennsylvania R. Co., 308 U.S. 529, 60 S.Ct. 385, 84 L.Ed. 447;* reversal of judgment for plaintiff reversed. 1940 Term.
172
Jenkins v. Kurn, 313 U.S. 256, 61 S.Ct. 934, 85 L.Ed. 1316; reversal of judgment for plaintiff reversed.
173
Steeley v. Kurn, 313 U.S. 545, 61 S.Ct. 1087, 85 L.Ed. 1512;* reversal of judgment for plaintiff reversed.
174
1941 Term.
175
Seago v. New York Central R. Co., 315 U.S. 781, 62 S.Ct. 806, 86 L.Ed. 1188;* affirmance of judgment for defendant reversed.
176
1942 Term.
177
Tiller v. Atlantic Coast Line R. Co., 318 U.S. 54, 63 S.Ct. 444, 87 L.Ed. 610; affirmance of directed verdict for defendant reversed.
178
Bailey v. Central Vermont R. Co., 319 U.S. 350, 63 S.Ct. 1062, 87 L.Ed. 1444; reversal of judgment for plaintiff reversed.
179
Owens v. Union Pacific R. Co., 319 U.S. 715, 63 S.Ct. 1271, 87 L.Ed. 1683; reversal of judgment for plaintiff reversed.
180
1943 Term.
181
Brady v. Southern R. Co., 320 U.S. 476, 64 S.Ct. 232, 88 L.Ed. 239; reversal of judgment for plaintiff affirmed.
182
Tennant v. Peoria & P.U.R. Co., 321 U.S. 29, 64 S.Ct. 409, 88 L.Ed. 520; reversal of judgment for plaintiff reversed.
183
1944 Term.
184
Tiller v. Atlantic Coast Line R. Co., 323 U.S. 574, 65 S.Ct. 421, 89 L.Ed. 465; reversal of judgment for plaintiff reversed.
185
Blair v. Baltimore & O.R. Co., 323 U.S. 600, 65 S.Ct. 545, 89 L.Ed. 490; reversal of entry of judgment for defendant reversed; sufficient evidence to support jury verdict for plaintiff.
186
1945 Term.
187
Keeton v. Thompson, 326 U.S. 689, 66 S.Ct. 135, 90 L.Ed. 405;* reversal of judgment for plaintiff reversed.
188
Lavender v. Kurn, 327 U.S. 645, 66 S.Ct. 740, 90 L.Ed. 916; reversal of judgment for plaintiff reversed.
189
Cogswell v. Chicago & E.I.R. Co., 328 U.S. 820, 66 S.Ct. 1122, 90 L.Ed. 1601;* reversal of judgment for plaintiff reversed.
190
1946 Term.
191
Jesionowski v. Boston & M.R. Co., 329 U.S. 452, 67 S.Ct. 401, 91 L.Ed. 416; reversal of judgment for plaintiff reversed.
192
Ellis v. Union Pacific R. Co., 329 U.S. 649, 67 S.Ct. 598, 91 L.Ed. 572; reversal of judgment for plaintiff reversed.
193
Pauly v. McCarthy, 330 U.S. 802, 67 S.Ct. 962, 91 L.Ed. 1261;* reversal of judgment for plaintiff reversed.
194
Myers v. Reading Co., 331 U.S. 477, 67 S.Ct. 1334, 91 L.Ed. 1615; affirmance of judgment n.o.v. for defendant reversed.
195
1947 Term.
196
Lillie v. Thompson, 332 U.S. 459, 68 S.Ct. 140, 92 L.Ed. 73;* affirmance of dismissal of complaint reversed.
197
Hunter v. Texas Electric R. Co., 332 U.S. 827, 68 S.Ct. 203, 92 L.Ed. 402;* affirmance of judgment for defendant affirmed.
198
Anderson v. Atchison, T. & S.F.R. Co., 333 U.S. 821, 68 S.Ct. 854, 92 L.Ed. 1108;* affirmance of judgment for defendant reversed.
199
Eubanks v. Thompson, 334 U.S. 854, 68 S.Ct. 1528, 92 L.Ed. 1776;* reversal of judgment for plaintiff reversed.
200
1948 Term.
201
Eckenrode v. Pennsylvania R. Co., 335 U.S. 329, 69 S.Ct. 91, 93 L.Ed. 41; affirmance of judgment n.o.v. for defendant affirmed.
202
Coray v. Southern Pacific Co., 335 U.S. 520, 69 S.Ct. 275, 93 L.Ed. 208; affirmance of directed verdict for defendant reversed.
203
Penn v. Chicago & N.W.R. Co., 335 U.S. 849, 69 S.Ct. 79, 93 L.Ed. 398;* reversal of judgment for plaintiff reversed.
204
Wilkerson v. McCarthy, 336 U.S. 53, 69 S.Ct. 413, 93 L.Ed. 497; affirmance of directed verdict for defendant reversed.
205
Reynolds v. Atlantic Coast Line R. Co., 336 U.S. 207, 69 S.Ct. 507, 93 L.Ed. 618;* affirmance of judgment for defendant on demurrer affirmed.
206
Hill v. Atlantic Coast Line R. Co., 336 U.S. 911, 69 S.Ct. 507, 93 L.Ed. 1075;* affirmance of nonsuit reversed.
207
1949 Term.
208
Carter v. Atlanta & St. A.B.R. Co., 338 U.S. 430, 70 S.Ct. 226, 94 L.Ed. 236; affirmance of judgment for defendant reversed.
209
Affolder v. New York, C. & St. L.R. Co., 339 U.S. 96, 70 S.Ct. 509, 94 L.Ed. 683; reversal of judgment for plaintiff reversed.
210
1950 Term.
211
Moore v. Chesapeake & O.R. Co., 340 U.S. 573, 71 S.Ct. 428, 95 L.Ed. 547; affirmance of judgment for defendant n.o.v. affirmed.
212
1952 Term.
213
Stone v. New York, C. & St. L.R. Co., 344 U.S. 407, 73 S.Ct. 358, 97 L.Ed. 441; reversal of judgment for plaintiff reversed.
214
1954 Term.
215
Smalls v. Atlantic Coast Line R. Co., 348 U.S. 946, 75 S.Ct. 439, 99 L.Ed. 740;* reversal of judgment for plaintiff reversed.
216
O'Neill v. Baltimore & O.R. Co., 348 U.S. 956, 75 S.Ct. 447, 99 L.Ed. 747; * reversal of judgment for plaintiff reversed.
217
1955 Term.
218
Anderson v. Atlantic Coast Line R. Co., 350 U.S. 807, 76 S.Ct. 60, 100 L.Ed. 725;* reversal of judgment for plaintiff reversed.
219
Strickland v. Seaboard Air Line R. Co., 350 U.S. 893, 76 S.Ct. 157, 100 L.Ed. 786;* reversal of judgment for plaintiff reversed.
220
Cahill v. New York, N.H. & H.R. Co., 350 U.S. 898, 76 S.Ct. 180, 100 L.Ed. 790;* 351 U.S. 183, 76 S.Ct. 758, 100 L.Ed. 1075; reversal of judgment for plaintiff reversed.
221
Mr. Justice HARLAN, concurring in No. 46 and dissenting in Nos. 28, 42 and 59.
I.
222
I am in full agreement with what my Brother FRANKFURTER has written in criticism of the Court's recurring willingness to grant certiorari in casses of this type. For the reasons he has given, I think the Court should not have heard any of these four cases. Nevertheless, the cases having been taken, I have conceived it to be my duty to consider them on their merits, because I cannot reconcile voting to dismiss the writs as 'improvidently granted' with the Court's 'rule of four.' In my opinion due adherence to that rule requires that once certiorari has been granted a case should be disposed of on the premise that it is properly here, in the absence of considerations appearing which were not manifest or fully apprehended at the time certiorari was granted. In these instances I am unable to say that such considerations exist, even though I do think that the arguments on the merits underscored the views of those of us who originally felt that the cases should not be taken because they involved only issues of fact, and presented nothing of sufficient general importance to warrant this substantial expenditure of the Court's time.
223
I do not think that, in the absence of the considerations mentioned, voting to dismiss a writ after it has been granted can be justified on the basis of an inherent right of dissent. In the case of a petition for certiorari that right, it seems to me—again without the presence of intervening factors—is exhausted once the petition has been granted and the cause set for argument.1 Otherwise the 'rule of four' surely becomes a meaningless thing in more than one respect. First, notwithstanding the 'rule of four,' five objecting Justices could undo the grant by voting, after the case has been heard, to dismiss the writ as improvidently granted—a course which would hardly be fair to litigants who have expended time, effort, and money on the assumption that their cases would be heard and decided on the merits. While in the nature of things litigants must assume the risk of 'improvidently granted' dismissals because of factors not fully apprehended when the petition for certiorari was under consideration, short of that it seems to me that the Court would stultify its own rule if it were permissible for a writ of certiorari to be annulled by the later vote of five objecting Justices. Indeed, if that were proper, it would be preferable to have the vote of annulment come into play the moment after the petition for certiorari has been granted, since then at least the litigants would be spared useless effort in briefing and preparing for the argument of their cases. Second, permitting the grant of a writ to be thus undone would undermine the whole philosophy of the 'rule of four,' which is that any case warranting consideration in the opinion of such a substantial minority of the Court will be taken and disposed of. It appears to me that such a practive would accomplish just the contrary of what representatives of this Court stated to Congress as to the 'rule of four' at the time the Court's certiorari jurisdiction was enlarged by the Judiciary Act of 1925.2 In effect the 'rule of four' would, by indirection, become a 'rule of five.' Third, such a practice would, in my opinion, be inconsistent with the long-standing and desirable custom of not announcing the Conference vote on petitions for certiorari. For in the absence of the intervening circumstances which may cause a Justice to vote to dismiss a writ as improvidently granted, such a disposition of the case on his part is almost bound to be taken as reflecting his original Conference vote on the petition. And if such a practice is permissible, then by the same token I do not see how those who voted in favor of the petition can reasonably be expected to refrain from announcing their Conference votes at the time the petition is acted on.
224
My Brother FRANKFURTER states that the course he advocates will not result in making of the 'rule of four' an empty thing, suggesting that in individual cases 'a doubting Justice' will normally respect 'the judgment of his brethren that the case does concern issues important enough for the Court's consideration and adjudication,' and that it is only 'when a class of cases is systematically taken for review' that such a Justice 'cannot forego his duty to voice his dissent to the Court's action.' However, it seems to me that it is precisely in that type of situation where the exercise of the right of dissent may well result in nullification of the 'rule of four' by the action of five Justices. For differences of view as to the desirability of the Court's taking particular 'classes' of cases—the situation we have here—are prone to lead to more or less definite lines of cleavage among the Justices, which past experience has shown may well involve an alignment of four Justices who favor granting certiorari in such cases and five who do not. If in such situations it becomes the duty of one Justice among the disagreeing five not to 'forego' his right to dissent, then I do not see why it is not equally the duty of the remaining four, resulting in the 'rule of four' being set at naught. I thus see no basis in the circumstance that a case is an 'individual' one rather than one of a 'class' for distinctions in what may be done by an individual Justice who disapproves of the Court's action in granting certiorari.
225
Although I feel strongly that cases of this kind do not belong in this Court, I can see no other course, consistent with the 'rule of four,' but to continue our Conference debates, with the hope that persuasion or the mounting calendars of the Court will eventually bring our differing brethren to another point of view.
II.
226
Since I can find no intervening circumstances which would justify my voting now to dismiss the writs in these cases as improvidently granted, I turn to the merits of the four cases before us. I agree with, and join in, the Court's opinion in No. 46. I dissent in Nos. 28, 42 and 59. No doubt the evidence in the latter three cases can be viewed both as the three courts below did and as this Court does. So far as I can see all this Court has done is to substitute its views on the evidence for those of the Missouri Supreme Court and the two Courts of Appeals, and that is my first reason for dissenting. In my view we should not interfere with the decisions of these three courts in the absence of clear legal error, or some capricious or unreasonable action on their part. Nothing of that kind has been shown here. I would apply to cases of this type the reasoning of the Court in National Labor Relations Board v. Pittsburgh Steamship Co., 340 U.S. 498, 502—503, 71 S.Ct. 453, 456, 95 L.Ed. 479, dealing with review of decisions of the National Labor Relations Board by the Courts of Appeals, 6 Cir., 180 F.2d 731:
227
'Were we called upon to pass on the Board's conclusions in the first instance or to make an independent review of the review by the Court of Appeals, we might well support the Board's conclusion and reject that of the court below. But Congress has charged the Courts of Appeals and not this Court with (that) normal and primary responsibility * * *. The same considerations that should lead us to leave undisturbed, by denying certiorari, decisions of Courts of Appeals involving solely a fair assessment of a record on the issue of unsubstantiality, ought to lead us to do no more than decide that there was such a fair assessment when the case is here * * *.
228
'This is not the place to review a conflict of evidence nor to reverse a Court of Appeals because were we in its place we would find the record tilting one way rather than the other, though fair-minded judges could find it tilting either way.'
229
For my part, to overturn the judgments below simply involves second-guessing the Missouri Supreme Court, the Court of Appeals for the Seventh Circuit, and the Court of Appeals for the Second Circuit, on questions of fact on which they brought to bear judgments neither capricious nor unreasonable, and on which they made 'fair assessment of a record.'
230
I dissent also for another reason. No scientific or precise yardstick can be devised to test the sufficiency of the evidence in a negligence case. The problem has always been one of judgment, to be applied in view of the purposes of the statute. It has, however, been common ground that a verdict must be based on evidence—not on a scintilla of evidence but evidence sufficient to enable a reasoning man to infer both negligence and causation by reasoning from the evidence. Moore v. Chesapeake & O.R. Co., 340 U.S. 573, 71 S.Ct. 428, 95 L.Ed. 547. And it has always been the function of the court to see to it that jury verdicts stay within that boundary, that they be arrived at by reason and not by will or sheer speculation. Neither the Seventh Amendment nor the Federal Employers' Liability Act, 45 U.S.C.A. § 51 et seq. lifted that duty from the courts. However, in judging these cases, the Court appears to me to have departed from these long-established standards, for, as I read these opinions, the implication seems to be that the question, at least as to the element of causation, is not whether the evidence is sufficient to convince a reasoning man, but whether there is any scintilla of evidence at all to justify the jury verdicts. I cannot agree with such a standard, for I consider it a departure from a wise rule of law, not justified either by the provision of the FELA making employers liable for injuries resulting 'in whole or in part' from their negligence, or by anything else in the Act or its history, which evinces no purpose to depart in these respects from common-law rules.
231
For these reasons I think the judgments in Nos. 28, 42 and 59, as well as that in No. 46, should be affirmed.
232
Mr. Justice BURTON concurs in Part I of this opinion.
233
The CHIEF JUSTICE, Mr. Justice BLACK, Mr. Justice DOUGLAS, Mr. Justice CLARK, and Mr. Justice BRENNAN concur in Part I of this opinion except insofar as it disapproves of the grant of the writ of certiorari in these cases.
1
He formally took his seat on June 5, 1916 (241 U.S. III), but did not begin active participation in the Court's work until the beginning of the October Term, 1916.
2
Throughout this opinion I have dealt with the issue of granting certiorari in this type of case almost entirely in terms of the Federal Employers' Liability Act because the greatest abuse of the certiorari policy has occurred in that field. The problem is not confined to that Act, however, since the same or similar issues arise under other Acts, such as the Jones Act, 41 Stat. 1007, 46 U.S.C.A. § 688, the Federal Tort Claims Act, 28 U.S.C. §§ 1346(b), 2671-2680, 28 U.S.C.A. §§ 1346, 2671—2680, the Safety Appliance Act, 27 Stat. 531, 45 U.S.C.A. § 1 et seq., the Boiler Inspection Act, 45 U.S.C. § 22 et seq., 45 U.S.C.A. § 22 et seq., the Suits in Admiralty Act, 46 U.S.C. § 741 et seq., 46 U.S.C.A. § 741 et seq., and the Lucas Act, 60 Stat. 902, 41 U.S.C.A. § 106 note (see Buffalo Faultless Pants Co. v. United States, Ct.Cl., 142 F.Supp. 594). Indeed, one of the decisions to which this dissent is written, No. 59, arises under the Jones Act.
3
Hill v. Atlantic Coast Line R. Co., 336 U.S. 911, 69 S.Ct. 507, 93 L.Ed. 1075; Carter v. Atlanta & St. A.B.R. Co., 338 U.S. 430, 437, 70 S.Ct. 226, 230, 94 L.Ed. 236; Affolder v. New York C. & St. L.R. Co., 339 U.S. 96, 101, 70 S.Ct. 509, 511, 94 L.Ed. 683; Moore v. Chesapeake & O.R. Co., 340 U.S. 573, 578, 71 S.Ct. 428, 430, 95 L.Ed. 547; Anderson v. Atlantic Coast Line R. Co., 350 U.S. 807, 76 S.Ct. 60, 100 L.Ed. 725. See McAllister v. United States, 348 U.S. 19, 23, 75 S.Ct. 6, 9, 99 L.Ed. 20; (Suits in Admiralty Act); Schulz v. Pennsylvania R. Co., 350 U.S. 523, 527, 76 S.Ct. 608, 610, 100 L.Ed. 668 (Jones Act). See also Wilkerson v. McCarthy, 336 U.S. 53, 64, 69 S.Ct. 413, 418, 93 L.Ed. 497; Reynolds v. Atlantic Coast Line R. Co., 336 U.S. 207, 209, 69 S.Ct. 507, 508, 93 L.Ed. 618; Stone v. New York, C. & St. L.R. Co., 344 U.S. 407, 410, 73 S.Ct. 358, 360, 97 L.Ed. 441.
4
'Improvidently granted' is a term of art simply meaning that on full consideration it becomes manifest that the case is not the type of case that should have been brought here. The term is the counterpart of the phrase 'improvidently taken,' as used by Congress in 28 U.S.C. § 2103, 28 U.S.C.A. § 2103, governing appeals from state courts that are improvidently taken.
5
See discussion of this point in Rice v. Sioux City Memorial Park Cemetery, 349 U.S. 70, and cases there collected at p. 78, note 2, 75 S.Ct. 614, 618, 99 L.Ed. 897.
6
The attempts to substitute a workmen's compensation law are detailed in Miller, The Quest for a Federal Workmen's Compensation Law, 18 Law and Contemporary Problems 188.
7
See, e.g., Wilkerson v. McCarthy, 336 U.S. 53, 69, 69 S.Ct. 413, 421, 93 L.Ed. 497: 'The basis of liability under the Act is and remains negligence.' (Concurring opinion of Douglas, J.) To be sure, on the question of casualty, the statute has tried to avoid issues about 'sole proximate cause,' meeting the requirement of a causal relation with the language that the injury must result "in whole or in part" from the employer's negligence. See, e.g., Illinois Central R. Co. v. Skaggs, 240 U.S. 66, 69—70, 36 S.Ct. 249, 250, 60 L.Ed. 528.
8
See Elihu Root's address to the American Bar Association in 1914: 'Lawyers are essentially conservative. They do not take kindly to change. They are not naturally reformers. Their time is occupied mainly in thinking and arguing about what the law of the particular case is; about what the facts of the case are. The most successful lawyers are, as a rule, continually engrossed in their own cases and they have little time and little respect for the speculative and hypothetical. The lawyers who have authority as leaders of opinion are men, as a rule, who have succeeded in their profession, and men naturally tend to be satisfied with the conditions under which they are succeeding.' Root, Addresses on Government and Citizenship, 479, 484. See also Gibson, The Venue Clause and Transportation of Lawsuits, 18 Law and Contemporary Problems 367, for some statistics bearing on the interest of lawyers in the continuance of the present system. The author cites the example of one specialist in personal injury litigation whose administrator collected a minimum of $1,111,935 in fees from 150 lawsuits pending at the date of the lawyer's death.
9
An archaic system, I might add, that encourages pursuit of big verdicts in individual cases, a preoccupation that has attained the dignity of full documentation of sensational methods by which a jury's feelings may be exploited.
10
'If there were a bright line dividing negligence from non-negligence, there would be no problem. Only an incompetent or a wilful judge would take a case from the jury when the issue should be left to the jury. But since questions of negligence are questions of degree, often very nice differences of degree, judges of competence and conscience have in the past, and will in the future, disagree as to whether proof in a case is sufficient to demand submission to the jury. The fact that a third court thinks there was enough to leave the case to the jury does not indicate that the other two courts were unmindful of the jury's function. The easy but timid way out for a trial judge is to leave all casestried to a jury for jury determination, but in so doing he fails in his duty to take a case from the jury when the evidence would not warrant a verdict by it. A timid judge, like a biased judge, is intrinsically a lawless judge.' Wilkerson v. McCarthy, 336 U.S. 64, 65, 69 S.Ct. 413 (concurring).
11
Any notion that the practice of directing verdicts offends the Seventh Amendment was laid to rest in Galloway v. United States, 319 U.S. 372, 63 S.Ct. 1077, 87 L.Ed. 1458.
12
'The cause is one of a peculiar class where we have frequently been obliged to give special consideration to the facts in order to protect interstate carriers against unwarranted judgments and enforce observance of the Liability Act as here interpreted.' Atchison, T. & S.F.R. Co. v. Saxon, 284 U.S. 458, 459, 52 S.Ct. 229, 76 L.Ed. 397.
*
This table restricts itself to decisions on the sufficiency of the evidence relating to the substantive cause of action for submission to the jury. It does not take into account other sufficiency-of-the-evidence cases, e.g., was an employee engaged in interstate commerce, that raise somewhat different problems but are all too often also outside the appropriate bounds of certiorari jurisdiction.
In some of the cases resulting in an affirmance of a judgment for an employee, sufficiency of the evidence was only one of the questions considered. It is impossible to ascertain why certiorari was granted, but these cases are included in the table because the Court did not restrict its grant of certiorari to the other issues, as it frequently does, and did consider the sufficiency-of-the-evidence question.
1911............... 1 1934 1
1912............... 2 1935 1
1913............... 4 1936 0
1914............... 4 1937 0
1915............... 19 1938 1
1916............... 6 1939 1**
1917............... 5 1940 2**
1918............... 1 1941 1**
1919............... 2 1942 3
1920............... 1 1943 2
1921............... 0 1944 2
1922............... 0 1945 3**
1923............... 3** 1946.............. 4**
1924............... 2 1947 4**
1925............... 4 1948 6**
1926............... 0 1949 2
1927............... 6 1950 1
1928............... 6** 1951.............. 0
1929............... 4 1952 1
1930............... 1 1953 0
1931............... 7 1954 2**
1932............... 2 1955 3**
1933............... 1 1956 4
**
These figures include 1 summary per curiam disposition on the merits in the 1923 Term, 1 in the 1928 Term, 1 in the 1939 Term, 1 in the 1940 Term, 1 in the 1941 Term, 2 in the 1945 Term, 1 in the 1946 Term, 4 in the 1947 Term, 2 in the 1948 Term, 2 in the 1954 Term, and 3 in the 1955 Term. See 69 Harv.L.Rev. 1441, 1446, n. 30. The Reports have not been examined for summary dispositions on the merits prior to 1938. That practice did not become established in these cases until then, and prior to that time was at most desultory.
1
In some instances where the Court has granted certiorari and simultaneously summarily disposed of the case on the merits, individual Justices (including the writer) have merely noted their dissent to the grant without reaching the merits. See, e.g., Anderson v. Atlantic Coast Line R. Co., 350 U.S. 807, 76 S.Ct. 60, 100 L.Ed. 725; Cahill v. New York, N.H. & H.R. Co., 350 U.S. 898, 76 S.Ct. 180, 100 L.Ed. 790. Even here, I am bound to say, it would probably be better practice for a Justice, who has unsuccessfully opposed certiorari, to face the merits, and to dissent from the summary disposition rather than from the grant of certiorari if he is not prepared to reach the merits without fulldress argument.
2
See Burton, Judging Is Also Administration, 21 Temple Law Quarterly 77, 84—85 and n. 23 (1947).
| 78
|
352 U.S. 518
77 S.Ct. 455
1 L.Ed.2d 508
Virgil HERDMAN, Petitioner,v.PENNSYLVANIA RAILROAD CO.
No. 46.
Argued Dec. 4, 1956.
Decided Feb. 25, 1957.
Mr. Donald S. McNamara, Columbus, Ohio, for the petitioner.
Mr. John Eckler, Columbus, Ohio, for the respondent.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
In this Federal Employers' Liability Act1 case, the Court of Appeals for the Sixth Circuit affirmed the judgment of the District Court for the Southern District of Ohio, which was entered on a directed verdict in favor of the respondent. The Court of Appeals agreed with the District Court that there was a complete absence of probative facts to support the conclusion of negligence.2 This Court granted certiorari to determine whether the petitioner was erroneously deprived of a jury determination of his case.3
2
The petitioner was the conductor in charge of a 67-car freight train which on February 1, 1951, was en route from Richmond, Indiana, to Columbus, Ohio. He was in the caboose at the end of the train when it came to a sudden stop about three miles before a scheduled stop in Dayton, Ohio. He brought this action for damages for injuries allegedly suffered from a fall in the caboose which occurred when the train stopped. He testified: 'Well, we were coming through there at a slow like speed and I don't know what went wrong, the train went in emergency and threw me into this table and tore it up and I was up on the floor with my flagman on top of me, when we finally got straightened up.' He immediately left the caboose and satisfied himself that the stop was not caused by a mechanical failure of the braking equipment, but rather that the engineer had applied the brakes to bring the train to a stop. At the end of the run, he filed his routine conductor's report of the incident. He read that report into the record, without objection, during his cross-examination. The report states: 'CN 28, Engine 8800 and 5680 moving east through Dayton, with 67 cars, at estimated speed of eight or ten miles per hour. Automobile drove over crossing just east of Dayton Rubber Works. To prevent striking automobile engineman applied air in emergency causing rough stop. I was standing in cabin observing air gauge and when stop was made knocked me to floor of cabin bruising my hip.' He also stated that the engineer had told him that there were school children in the automobile. There was no evidence that the stop was made with any special or unusual severity.
3
The sole issue raised is whether a jury question was presented by the evidence under the doctrine of res ipsa loquitur. We agree with the lower courts that a jury question of negligence was not presented by the proofs. The proofs do not meet the tests laid down by this Court in Jesionowski v. Boston & M.R. Co., 329 U.S. 452, 67 S.Ct. 401, 91 L.Ed. 416. The employee's injuries in the Jesionowski case resulted from a derailment. This Court held that derailments are 'extraordinary, not usual, happenings,' so that when they occur 'a jury may fairly find that they occurred as a result of negligence.'4
4
In this case, there is no evidence to show that unscheduled and sudden stops of trains are unusual or extraordinary occurrences. In fact, the only evidence was petitioner's testimony that they are not unusual or extraordinary. He testified: 'We got to expect them or think about them.' The facts of this occurrence thus do not warrant the inference that the respondent was negligent.
5
The judgment is affirmed.
6
Affirmed.
7
For concurring opinion of Mr. Justice HARLAN and dissenting opinion of Mr. Justice FRANKFURTER, see 352 U.S. 518, 77 S.Ct. 459.
1
35 Stat. 65, as amended, 36 Stat. 291, 53 Stat. 1404, 45 U.S.C.A. § 51 et seq., 45 U.S.C.A. § 51 et seq.
2
228 F.2d 902.
3
351 U.S. 906, 76 S.Ct. 698, 100 L.Ed. 1442.
4
Jesionowski v. Boston & M.R. Co., 329 U.S. 452, 458, 67 S.Ct. 401, 404.
| 78
|
352 U.S. 432
77 S.Ct. 408
1 L.Ed.2d 448
Paul H. BREITHAUPT, Petitioner,v.Morris ABRAM, Warden.
No. 69.
Argued Dec. 12 and 13, 1956.
Decided Feb. 25, 1957.
Mr. F. Gordon Shermack, Santa Fe, N.M., for the petitioner.
Messrs.Richard H. Robinson and Walter R. Kegel, Santa Fe, N.M., for respondent.
Mr. Justice CLARK delivered the opinion of the Court.
1
Petitioner, while driving a pickup truck on the highways of New Mexico, was involved in a collision with a passenger car. Three occupants of the car were killed and petitioner was seriously injured. A pint whiskey bottle, almost empty, was found in the glove compartment of the pickup truck. Petitioner was taken to a hospital and while he was lying unconscious in the emergency room the smell of liquor was detected on his breath. A state patrolman requested that a sample of petitioner's blood be taken. An attending physician, while petitioner was unconscious, withdrew a sample of about 20 cubic centimeters of blood by use of a hypodermic needle. This sample was delivered to the patrolman and subsequent laboratory analysis showed this blood to contain about .17% alcohol.
2
Petitioner was thereafter charged with involuntary manslaughter. Testimoney regarding the blood test and its result was admitted into evidence at trial over petitioner's objection. This included testimony of an expert that a person with .17% alcohol in his blood was under the influence of intoxicating liquor. Petitioner was convicted and sentenced for involuntary manslaughter. He did not appeal the conviction. Subsequently, however, he sought release from his imprisonment by a petition for a writ of habeas corpus to the Supreme Court of New Mexico.1 That court, after argument, denied the writ. 1954, 58 N.M. 385, 271 P.2d 827. Petitioner contends that his conviction, based on the result of the involuntary blood test, deprived him of his liberty without that due process of law guaranteed him by the Fourteenth Amendment to the Constitution. We granted certiorari, 351 U.S. 906, 76 S.Ct. 699, 100 L.Ed. 1442, to determine whether the requirements of the Due Process Clause, as it concerns state criminal proceedings, necessitate the invalidation of the conviction.
3
It has been clear since Weeks v. United States, 1914, 232 U.S. 383, 34 S.Ct. 341, 58 L.Ed. 652, that evidence obtained in violation of rights protected by the Fourth Amendment to the Federal Constitution must be excluded in federal criminal prosecutions. There is argument on behalf of petitioner that the evidence used here, the result of the blood test, was obtained in violation of the Due Process Clause of the Fourteenth Amendment in that the taking was the result of an unreasonable search and seizure violative of the Fourth Amendment. Likewise, he argues that by way of the Fourteenth Amendment there has been a violation of the Fifth Amendment in that introduction of the test result compelled him to be a witness against himself. Petitioner relies on the proposition that 'the generative principles' of the Bill of Rights should extend the protections of the Fourth and Fifth Amendments to his case through the Due Process Clause of the Fourteenth Amendment. But Wolf v. Colorado, 1949, 338 U.S. 25, 69 S.Ct. 1359, 93 L.Ed. 1782, answers this contention in the negative. See also Twining v. New Jersey, 1908, 211 U.S. 78, 29 S.Ct. 14, 53 L.Ed. 97; Palko v. Connecticut, 1937, 302 U.S. 319, 58 S.Ct. 149, 82 L.Ed. 288; Irvine v. California, 1954, 347 U.S. 128, 74 S.Ct. 381, 98 L.Ed. 561. New Mexico has rejected, as it may, the exclusionary rule set forth in Weeks, supra. State v. Dillon, 1929, 34 N.M. 366, 281 P. 474, 88 A.L.R. 340. Therefore, the rights petitioner claims afford no aid to him here for the fruits of the violations, if any, are admissible in the State's prosecution.
4
Petitioner's remaining and primary assault on his conviction is not so easily unhorsed. He urges that the conduct of the state officers here offends that 'sense of justice' of which we spoke in Rochin v. California, 1952, 342 U.S. 165, 72 S.Ct. 205, 96 L.Ed. 183. In that case state officers broke into the home of the accused and observed him place something in his mouth. The officers forced open his mouth after considerable struggle in an unsuccessful attempt to retrieve whatever was put there. A stomach pump was later forcibly used and among the matter extracted from his stomach were found narcotic pills. As we said there, 'this course of proceeding by agents of government to obtain evidence is bound to offend even hardened sensibilities.' Id., 342 U.S. at page 172, 72 S.Ct. at page 209. We set aside the conviction because such conduct 'shocked the conscience' and was so 'brutal' and 'offensive' that it did not comport with traditional ideas of fair play and decency. We therefore found that the conduct was offensive to due process. But we see nothing comparable here to the facts in Rochin.
5
Basically the distinction rests on the fact that there is nothing 'brutal' or 'offensive' in the taking of a sample of blood when done, an in this case, under the protective eye of a physician. To be sure, the driver here was unconscious when the blood was taken, but the absence of conscious consent, without more, does not necessarily render the taking a violation of a constitutional right;2 and certainly the test as administered here would not be considered offensive by even the most delicate. Furthermore, due process is not measured by the yardstick of personal reaction or the sphygmogram of the most sensitive person, but by that whole community sense of 'decency and fairness' that has been woven by common experience into the fabric of acceptable conduct. It is on this bedrock that this Court has established the concept of due process. The blood test procedure has become routine in our everyday life. It is a ritual for those going into the military service as well as those applying for marriage licenses. Many colleges require such tests before permitting entrance and literally millions of us have voluntarily gone through the same, though a longer, routine in becoming blood donors. Likewise, we note that a majority of our States have either enacted statutes in some form authorizing tests of this nature or permit findings so obtained to be admitted in evidence.3 We therefore conclude that a blood test taken by a skilled technician is not such 'conduct that shocks the conscience,' Rochin, supra, 342 U.S. at page 172, 72 S.Ct. at page 209, nor such a method of obtaining evidence that it offends a 'sense of justice,' Brown v. Mississippi, 1936, 297 U.S. 278, 285—286, 56 S.Ct. 461, 464—465, 80 L.Ed. 682.4 This is not to say that the indiscriminate taking of blood under different conditions or by those not competent to do so may not amount to such 'brutality' as would come under the Rochin rule. The chief law-enforcement officer of New Mexico, while at the Bar of this Court, assured us that every proper medical precaution is afforded an accused from whom blood is taken.5
6
The test upheld here is not attacked on the ground of any basis deficiency or of injudicious application, but admittedly is a scientifically accurate method of detecting alcoholic content in the blood, thus furnishing an exact measure upon which to base a decision as to intoxication. Modern community living requires modern scientific methods of crime detection lest the public go unprotected. The increasing slaughter on our highways, most of which should be avoidable, now reaches the astounding figures only heard of on the battlefield.6 The States, through safety measures, modern scientific methods, and strict enforcement of traffic laws, are using all reasonable means to make automobile driving less dangerous.7
7
As against the right of an individual that his person be held inviolable, even against so slight an intrusion as is involved in applying a blood test of the kind to which millions of Americans submit as a matter of course nearly every day, must be set the interests of society in the scientific determination of intoxication, one of the great causes of the mortal hazards of the road. And the more so since the test likewise may establish innocence, thus affording protection against the treachery of judgment based on one or more of the senses. Furthermore, since our criminal law is to no small extent justified by the assumption of deterrence, the individual's right to immunity from such invasion of the body as is involved in a properly safeguarded blood test is far outweighed by the value of its deterrent effect due to public realization that the issue of driving while under the influence of alcohol can often by this method be taken out of the confusion of conflicting contentions.
8
For these reasons the judgment is affirmed.
9
Affirmed.
10
Mr. Chief Justice WARREN, with whom Mr. Justice BLACK and Mr. Justice DOUGLAS join, dissenting.
11
The judgment in this case should be reversed if Rochin v. California, 342 U.S. 165, 72 S.Ct. 205, 96 L.Ed. 183, is to retain its vitality and stand as more than an instance of personal revulsion against particular police methods. I cannot agree with the Court when it says, 'we see nothing comparable here to the facts in Rochin.' It seems to me the essential elements of the cases are the same and the same result should follow.
12
There is much in the Court's opinion concerning the hazards on our nation's highways, the efforts of the States to enforce the traffic laws and the necessity for the use of modern scientific methods in the detection of crime. Everybody can agree with these sentiments, and yet they do not help us particularly in determining whether this case can be distinguished from Rochin. That case grew out of police efforts to curb the narcotics traffic, in which there is surely a state interest of at least as great magnitude as the interest in highway law enforcement. Nor does the fact that many States sanction the use of blood test evidence differentiate the cases. At the time Rochin was decided illegally obtained evidence was admissible in the vast majority of States. In both Rochin and this case the officers had probable cause to suspect the defendant of the offense of which they sought evidence. In Rochin the defendant was known as a narcotics law violator, was arrested under suspicious circumstances and was seen by the officers to swallow narcotics. In neither case, of course, are we concerned with the defendant's guilt or innocence. The sole problem is whether the proceeding was tainted by a violation of the defendant's constitutional rights.
13
In reaching its conclusion that in this case, unlike Rochin, there is nothing 'brutal' or 'offensive' the Court has not kept separate the component parts of the problem. Essentially there are two: the character of the invasion of the body and the expression of the victim's will; the latter may be manifested by physical resistance. Of course, one may consent to having his blood extracted or his stomach pumped and thereby waive any due process objection. In that limited sense the expression of the will is significant. But where there is no affirmative consent, I cannot see that it should make any difference whether one states unequivocally that he objects or resorts to physical violence in protest or is in such condition that he is unable to protest. The Court, however, states that 'the absence of conscious consent, without more, does not necessarily render the taking a violation of a constitutional right.' This implies that a different result might follow if petitioner had been conscious and had voiced his objection. I reject the distinction.
14
Since there clearly was no consent to the blood test, it is the nature of the invasion of the body that should be determinative of the due process question here presented. The Court's opinion suggests that an invasion is 'brutal' or 'offensive' only if the police use force to overcome a suspect's resistance. By its recital of the facts in Rochin—the references to a 'considerable struggle' and the fact that the stomach pump was 'forcibly used'1—the Court finds Rochin distinguishable from this case. I cannot accept an analysis that would make physical resistance by a prisoner a prerequisite to the existence of his constitutional rights.
15
Apart from the irrelevant factor of physical resistance, the techniques used in this case and in Rochin are comparable. In each the operation was performed by a doctor in a hospital. In each there was an extraction of body fluids. Neither operation normally causes any lasting ill effects. The Court denominates a blood test as a scientific method for detecting crime and cites the frequency of such tests in our everyday life. The stomach pump too is a common and accepted way of making tests and relieving distress. But it does not follow from the fact that a technique is a product of science or is in common, consensual use for other purposes that it can be used to extract evidence from a criminal defendant without his consent. Would the taking of spinal fluid from an unconscious person be condoned because such tests are commonly made and might be used as a scientific aid to law enforcement?
16
Only personal reaction to the stomach pump and the blood test can distinguish them. To base the restriction which the Due Process Clause imposes on state criminal procedures upon such reactions is to build on shifting sands. We should, in my opinion, hold that due process means at least that law-enforcement officers in their efforts to obtain evidence from persons suspected of crime must stop short of bruishing the body, breaking skin, puncturing tissue or extracting body fluids, whether they contemplate doing it by force or by stealth.
17
Viewed according to this standard, the judgment should be reversed.
18
Mr. Justice DOUGLAS, with whom Mr. Justice BLACK joins, dissenting.
19
The Court seems to sanction in the name of law enforcement the assault made by the police on this unconscious man. If law enforcement were the chief value in our constitutional scheme, then due process would shrivel and become of little value in protecting the rights of the citizen. But those who fashioned the Constitution put certain rights out of the reach of the police and preferred other rights over law enforcement.
20
One source of protection of the citizen against state action is the Due Process Clause of the Fourteenth Amendment. Our decisions hold that the police violate due process when they use brutal methods to obtain evidence against a man and use it to convict him. Rochin v. California, 342 U.S. 165, 72 S.Ct. 205, 96 L.Ed. 183; Chambers v. Florida, 309 U.S. 227, 60 S.Ct. 472, 84 L.Ed. 716. But the conception of due process is not limited to a prohibition of the use of force and violence against an accused. In Leyra v. Denno, 347 U.S. 556, 74 S.Ct. 716, 98 L.Ed. 948, we set aside a conviction where subtle, nonviolent methods had been used to exact a confession from a prisoner. For it was obvious that coercion might be the product of subtlety as well as of violence. We should take the same libertarian approach here.
21
As I understand today's decision there would be a violation of due process if the blood had been withdrawn from the accused after a struggle with the police. But the sanctity of the person is equally violated and his body assaulted where the prisoner is incapable of offering resistance as it would be if force were used to overcome his resistance. In both cases evidence is used to convict a man which has been obtained from him on an involuntary basis. I would not draw a line between the use of force on the one hand and trickery, subterfuge, or any police technique which takes advantage of the inability of the prisoner to resist on the other. Nor would I draw a line between involuntary extraction of words from his lips, the involuntary extraction of the contents of his stomach, and the involuntary extraction of fluids of his body when the evidence obtained is used to convict him. Under our system of government, police cannot compel people to furnish the evidence necessary to send them to prison. Yet there is compulsion here, following the violation by the police of the sanctity of the body of an unconscious man.
22
And if the decencies of a civilized state are the test, it is repulsive to me for the police to insert needles into an unconscious person in order to get the evidence necessary to convict him, whether they find the person unconscious, give him a pill which puts him to sleep, or use force to subdue him. The indignity to the individual is the same in one case as in the other, for in each is his body invaded and assaulted by the police who are supposed to be the citizen's protector.
23
I would reverse this judgment of conviction.
1
Petitioner sought and was denied a writ of habeas corpus from the District Court for Santa Fe County, New Mexico, on March 7, 1952.
2
It might be a fair assumption that a driver on the highways in obedience to a policy of the State, would consent to have a blood test made as a part of a sensible and civilized system protecting himself as well as other citizens not only from the hazards of the road due to drunken driving, but also from some use of dubious lay testimony. In fact, the State of Kansas has by statute declared that any person who operates a motor vehicle on the public highways of that State shall be deemed to have given his consent to submit to a chemical
test of his breath, blood, urine, or saliva for the purpose of determining the alcoholic content of his blood. If, after arrest for operation of a motor vehicle while under the influence of intoxicating liquor, the arresting officer has reasonable grounds for the arrest, and the driver refuses to submit to the test, the arresting officer must report this fact to the proper official who shall suspend the operator's permit. Kan.Gen.Stat.1949, Supp.1955, § 8—1001 through § 8—1007.
3
Forty-seven States use chemical tests, including blood tests, to aid in the determination of intoxication in cases involving charges of driving while under the influence of alcohol. Twenty-three of these States sanction the use of the tests by statute. These, for the most part, are patterned after § 11—902 of the Uniform Vehicle Code prepared by the National Committee on Uniform Traffic Laws and Ordinances. This section makes it unlawful to operate a motor vehicle while under the influence of intoxicating liquor. The finding of the presence of a certain percentage of alcohol, by weight, in the blood of a person gives rise to a presumption that he was under the influence of intoxicating liquor. The twenty-three state statutory provisions include: Ariz.Rev.Stat.Ann. § 28—692; Del.Code Ann.
Tit. 11, § 3507; Ga.Code Ann.1937, Cum.Supp.1955, § 68—1625; Idaho Code, 1948, Cum.Supp.1955, § 49—520.2; Burns' Ind.Stat.Ann.1952, Cum.Supp.1955, § 47—2003; Kan.Gen.Stat.1949, Supp.1955, § 8—1001 through § 8—1007; Ky.Rev.Stat.Ann.1955, § 189.520; Me.Rev.Stat.1954, c. 22, § 150; Minn.Stat.Ann. § 169.12; Neb.Rev.Stat.1943, Reissue of 1952, § 39—727.01; N.H.Rev.Stat.Ann.1955, § 262:20; N.J.S.A. § 39:4—50.1; McKinney's Consol.N.Y.Laws, c. 71, Vehicle and Traffic Law, § 70(5); N.D.Laws 1953, c. 247; Or.Rev.Stat.1955, § 483.630; S.C.Code, 1952, § 46 344; S.D.Code, 1939, Supp.1952, § 44.0302—1; Tenn.Code Ann.1955, § 59—1032 to § 59—1033; Utah Code Ann.1953, § 41—6—44; Va.Code, 1950, Supp.1956, § 18—75.1 to § 18—75.3; Wash.Rev.Code, 1951, § 46.56.010; Wis.Laws 1955, c. 510; Wyo.Comp.Stat.1945, Cum.Supp.1955, § 60—414. Other States have accepted the use of chemical tests for intoxication without statutory authority but with court approval. See, e.g., People v. Haeussler, 1953, 41 Cal.2d 252, 260 P.2d 8 (blood); Block v. People, 1951, 125 Colo. 36, 240 P.2d 512 (blood); Touchton v. State, 1944, 154 Fla. 547, 18 So.2d 752 (blood); People v. Bobczyk, 1951, 343 Ill.App. 504, 99 N.E.2d 567 (breath); State v. Haner, 1941, 231 Iowa 348, 1 N.W.2d 91 (blood); Breithaupt v. Abram, 1954, 58 N.M. 385, 271 P.2d 827 (blood); Bowden v. State, 1952, 95 Okl.Cr. 382, 246 P.2d 427 (blood and urine); McKay v. State, 1950, 155 Tex.Cr.R. 416, 235 S.W.2d 173 (breath). Still other States accept the practice of the use of chemical tests for intoxication though there does not appear to have been litigation on the problem. See the summary in a report of the Committee on Tests for Intoxication of the National Safety Council, 1955 Uses of Chemical Tests for Intoxication.
The fact that so many States make use of the tests negatives the suggestion that there is anything offensive about them. For additional discussion of the use of these blood tests see Inbau, Self-Incrimination (1950), 72—86.
4
Several States have considered the very problem here presented but none have found that the conduct of the state authorities was
so offensive as to necessitate reversal of convictions based in part on blood tests. People v. Duroncelay, 1956, 146 Cal.App.2d 96, 303 P.2d 617; Block v. People, 1951, 125 Colo. 36, 240 P.2d 512; State v. Ayres, 1949, 70 Idaho 18, 211 P.2d 142 (test results were favorable to accused); State v. Cram, 1945, 176 Or. 577, 160 P.2d 283, 164 A.L.R. 952. See also State v. Sturtevant, 1950, 96 N.H. 99, 70 A.2d 909; cf. United States v. Williamson, 1954, 4 U.S.C.M.A. 320, 15 C.M.R. 320. But see State v. Weltha, 1940, 228 Iowa 519, 292 N.W. 148; State v. Kroening, 1956, 274 Wis. 266, 79 N.W.2d 810. But cf. United States v. Jordan, 1957, 7 U.S.C.M.A. 452, 22 C.M.R. 242.
The withdrawal of blood for use in blood-grouping tests in state criminal prosecutions is widespread. See, e.g., Davis v. State, 1948, 189 Md. 640, 57 A.2d 289; State v. Alexander, 1951, 7 N.J. 585, 83 A.2d 441; Commonwealth v. Statti, 1950, 166 Pa.Super. 577, 73 A.2d 688.
Many States authorize blood tests in civil actions such as paternity proceedings. See, e.g., the discussion in Cortese v. Cortese, 1950, 10 N.J.Super. 152, 76 A.2d 717. Other States authorize such tests in bastardy proceedings. See, e.g., Jordan v. Davis, 1948, 143 Me. 185, 57 A.2d 209; State ex rel. Van Camp v. Welling, 1936, 6 Ohio Op. 371, 3 Ohio Supp. 333. For a general discussion of blood tests in paternity proceedings see Schatkin, Disputed Paternity Proceedings (3d ed.1953), 193—282.
5
In explanation, he advised that by regulation the state police are permitted to obtain blood for analysis only when the blood is withdrawn by a physician. He further advised that it is the customary administrative practice among municipalities to allow blood to be taken only by a doctor. In all cases a competent technician is required to make the laboratory analysis incident to the test. We were assured that in no instance had a municipality or the state police permitted the test to be made without these precautions.
6
National Safety Council, Accident Facts 1956, 43—71.
7
Governors' Conference Committee, Report on Highway Safety (Nov. 1956); National Committee on Uniform Traffic Laws and Ordinances, Uniform Vehicle Code (Rev. 1956); White House Confercnce on Highway Safety, Organize Your Community for Traffic Safety (1954).
1
Actually, the struggle in Rochin occurred in the defendant's home after the officers had broken in. He was arrested and taken to a hospital, and there was no evidence that he struggled there.
| 01
|
352 U.S. 380
77 S.Ct. 524
1 L.Ed.2d 412
Alfred E. BUTLER, Appellant,v.STATE OF MICHIGAN.
No. 16.
Argued Oct. 16, 1956.
Decided Feb. 25, 1957.
Mr. Manuel Lee Robbins, New York City, for the appellant.
Mr. Edmund E. Shepherd, Detroit, Mich., for the appellee.
Mr. Justice FRANKFURTER delivered the opinion of the Court.
1
This appeal from a judgment of conviction entered by the Recorder's Court of the City of Detroit, Michigan challenges the constitutionality of the following provision, § 343, of the Michigan Penal Code, Comp.Laws Supp.1954, § 750.343:
2
'Any person who shall import, print, publish, sell, possess with the intent to sell, design, prepare, loan, give away, distribute or offer for sale, any book, magazine, newspaper, writing, pamphlet, ballad, printed paper, print, picture, drawing, photograph, publication or other thing, including any recordings, containing obscene, immoral, lewd or lascivious language, or obscene, immoral, lewd or lascivious prints, pictures, figures or descriptions, tending to incite minors to violent or depraved or immoral acts, manifestly tending to the corruption of the morals of youth, or shall introduce into any family, school or place of education or shall buy, procure, receive or have in his possession, any such book, pamphlet, magazine, newspaper, writing, ballad, printed paper, print, picture, drawing, photograph, publication or other thing, either for the purpose of sale, exhibition, loan or circulation, or with intent to introduce the same into any family, school or place of education, shall be guilty of a misdemeanor.'
3
Appellant was charged with its violation for selling to a police officer what the trial judge characterized as 'a book containing obscene, immoral, lewd, lascivious language, or descriptions, tending to incite minors to violent or depraved or immoral acts, manifestly tending to the corruption of the morals of youth.' Appellant moved to dismiss the proceeding on the claim that application of § 343 unduly restricted freedom of speech as protected by the Due Process Clause of the Fourteenth Amendment in that the statute (1) prohibited distribution of a book to the general public on the basis of the undesirable influence it may have upon youth; (2) damned a book and proscribed its sale merely because of some isolated passages that appeared objectionable when divorced from the book as a whole; and (3) failed to provide a sufficiently definite standard of guilt. After hearing the evidence, the trial judge denied the motion, and, in an oral opinion, held that '* * * the defendant is guilty because he sold a book in the City of Detroit containing this language (the passages deemed offensive), and also because the Court feels that even viewing the book as a whole, it (the objectionable language) was not necessary to the proper development of the theme of the book nor of the conflict expressed therein.' Appellant was fined $100.
4
Pressing his federal claims, appellant applied for leave to appeal to the Supreme Court of Michigan. Although the State consented to the granting of the application 'because the issues involved in this case are of great public interest, and because it appears that further clarification of the language of * * * (the statute) is necessary,' leave to appeal was denied. In view of this denial, the appeal is here from the Recorder's Court of Detroit. We noted probable jurisdiction. 350 U.S. 963, 76 S.Ct. 432, 100 L.Ed. 837.
5
Appellant's argument here took a wide sweep. We need not follow him. Thus, it is unnecessary to dissect the remarks of the trial judge in order to determine whether he construed § 343 to ban the distribution of books merely because certain of their passages, when viewed in isolation, were deemed objectionable. Likewise, we are free to put aside the claim that the Michigan law falls within the doctrine whereby a New York obscenity statute was found invalid in Winters v. People of State of New York, 333 U.S. 507, 68 S.Ct. 665, 92 L.Ed. 840.
6
It is clear on the record that appellant was convicted because Michigan, by § 343, made it an offense for him to make available for the general reading public (and he in fact sold to a police officer) a book that the trial judge found to have a potentially deleterious influence upon youth. The State insists that, by thus quarantining the general reading public against books not too rugged for grown men and women in order to shield juvenile innocence, it is exercising its power to promote the general welfare. Surely, this is to burn the house to roast the pig. Indeed, the Solicitor General of Michigan has, with characteristic candor, advised the Court that Michigan has a statute specifically designed to protect its children against obscene matter 'tending to the corruption of the morals of youth.'* But the appellant was not convicted for violating this statute.
7
We have before us legislation not reasonably restricted to the evil with which it is said to deal. The incidence of this enactment is to reduce the adult population of Michigan to reading only what is fit for children. It thereby arbitrarily curtails one of those liberties of the individual, now enshrined in the Due Process Clause of the Fourteenth Amendment, that history has attested as the indispensable conditions for the maintenance and progress of a free society. We are constrained to reverse this conviction.
8
Reversed.
9
Mr. Justice BLACK concurs in the result.
*
Section 142 of Michigan's Penal Code, Comp.Laws 1948, § 750.142, provides:
'Any person who shall sell, give away or in any way furnish to any minor child any book pamphlet, or other printed paper or other thing, containing obscene language, or obscene prints, pictures, figures or descriptions tending to the corruption of the morals of youth, or any newspapers, pamphlets or other printed paper devoted to the publication of criminal news, police reports, or criminal deeds, and any person who shall in any manner hire, use or employ such child to sell, give away, or in any manner distribute such books, pamphlets or printed papers, and any person having the care, custody or control of any such child, who shall permit him or her to engage in any such employment, shall be guilty of a misdemeanor.'
Section 143, Comp.Laws 1948, § 750.143, provides:
'Any person who shall exhibit upon any public street or highway, or in any other place within the view of children passing on any public street or highway, any book, pamphlet or other printed paper or thing containing obscene language or obscene prints, figures, or descriptions, tending to the corruption of the morals of youth, or any newspapers, pamphlets, or other printed paper or thing devoted to the publication of criminal news, police reports or criminal deeds, shall on conviction thereof be guilty of a misdemeanor.'
| 23
|
352 U.S. 480
77 S.Ct. 421
1 L.Ed.2d 480
PENNSYLVANIA RAILROAD COMPANY and Brotherhood of Railroad Trainmen, Petitioners,v.N. P. RYCHLIK, Individually and on Behalf of and as Representative of Other Employees of the Pennsylvania Railroad.
No. 56.
Argued Dec. 10, 1956.
Decided Feb. 25, 1957.
Mr. Richard N. Clattenburg, Philadelphia, Pa., for petitioner, Pennsylvania Railroad.
Mr. Henry Kaiser, Washington, D.C., for petitioner, Brotherhood of Railroad Trainmen.
Messrs. Norman M. Spindelman and Meyer Fix, Rochester, N.Y., for the respondent.
Mr. Justice HARLAN delivered the opinion of the Court.
1
Petitioner Brotherhood of Railroad Trainmen is the collective bargaining representative for trainment employed by the petitioner Railroad. In accordance with Section 2, Eleventh (a) and (c) of the Railway Labor Act,1 the Brotherhood and the Railroad negotiated a union-shop contract in 1952, which required trainment employed by the Railroad to become members of and retain membership in the Brotherhood or in another labor organization 'national in scope' and 'organized in accordance with' the Railway Labor Act. Respondent Rychlik was employed as a trainman by the Railroad and was a member in good standing of the Brotherhood until February 1953. At that time he resigned from the Brotherhood and joined the United Railroad Operating Crafts (UROC), a competing union which respondent believed in good faith to be 'national in scope' and 'organized in accordance with' the Act, and therefore available for alternative membership under Section 2, Eleventh and the union-shop provision of the contract, even though UROC had never qualified itself under Section 3, First of the Act as one of the unions 'national in scope' eligible to elect the labor members of the National Railroad Adjustment Board.2 On July 31, 1954, Rychlik, continuing his membership in UROC, also joined the Switchmen's Union of North America, concededly a union 'national in scope' within the meaning of the statute and the contract.
2
Following his resignation from the Brotherhood, Rychlik was charged with violation of the union-shop agreement. He received two hearings before a 'System Board of Adjustment,' a body established under the agreement, pursuant to Section 3, Second of the Act,3 to settle contract disputes, and composed of two representatives each from the Failroad and the Brotherhood.4 This Board determined that membership in UROC did not satisfy the union-shop provision of the contract, which mirrored the requirements of the Act, and that therefore Rychlike had failed to maintain continuous union membership in accordance with the contract, not having joined the Switchmen's Union until some 16 months after resigning from the Brotherhood. Accordingly, Rychlik was discharged by the Railroad.
3
Rychlik, on behalf of himself and other employees of the Railroad similarly situated, thereupon brought this class suit in the United States District Court for the Western District of New York, seeking an injunction compelling petitioners to accept him as a member of the Brotherhood and an employee of the Railroad. He alleged that his discharge violated Section 2, Eleventh of the Railway Labor Act, and that the System Board's determination to the contrary could not be final and binding, since the presence on that Board of two representatives of the Brotherhood created an inherent and fatal bias which vitiated the proceeding. The District Court granted petitioners' motion to dismiss the complaint for lack of jurisdiction and for failure to state a cause of action.5 The Court of Appeals for the Second Circuit reversed and remanded for review on the merits of the System Board's decision that membership in UROC did not satisfy the Act.6 Accepting the premise that Section 2, Eleventh (c) conferred on respondent a right to belong to any union which is, in fact, 'national in scope' and organized in accordance with the Railway Labor Act, even though it has not qualified under Section 3, First of the Act as an elector of labor representatives on the National Railroad Adjustment Board,7 the court held (1) that, although the System Board had jurisdiction over this dispute between Rychlik and the Brotherhood,8 its decision that UROC was not a union 'national in scope' was subject to full review on the merits, because of the bias which must be attributed to a body half of whose members represented the Brotherhood, a party in interest; and (2) that this bias was not cured by the availability of the alternative procedure provided by Section 3, First of the Act, whereby it can be established that a union is 'national in scope' and organized in accordance with the Act.9 Because of a conflict between the decision of the court below and an earlier decision of the Court of Appeals for the Sixth Circuit,10 and the importance of these questions in the administration of the Railway Labor Act, we granted certiorari. 351 U.S. 930, 76 S.Ct. 789, 100 L.Ed. 1459.
4
On our view of the case we do not reach either question decided by the Court of Appeals, for we disagree with its premise as to the meaning of Section 2, Eleventh (c). For reasons hereafter given, we hold that Section 2, Eleventh (c) allows alternative union membership only in those unions which have already qualified under Section 3, First of the Act, as electors of the union representatives on the National Railroad Adjustment Board, and not membership in any union which happens to be, as a matter of fact, national in scope and organized in accordance with the Railway Labor Act. Since UROC was not so qualified, respondent had no federal right to join it in lieu of the authorized bargaining representative under the union-shop provision of the Railroad-Brotherhood contract. His discharge by petitioners therefore did not give rise to a federal cause of action.11
5
In order to clarify the reasons for these conclusions, a brief outline of the relevant provisions of the Railway Labor Act is necessary. Section 2, Eleventh (a) of that Act authorizes railroads and labor unions to establish a union shop, that is, an agreement requiring as a condition of continued employment that employees join the union designated as their authorized bargaining representative.12 Section 2, Eleventh (c) then provides that in the case of operating employees the union-shop provision of a contract will be satisfied if an employee is a member of 'any one of the labor organizations, national in scope, organized in accordance with this Act and admitting to membership employees of a craft or class in any of said services * * *.'13
6
Section 3, First establishes the National Railroad Adjustment Board (NRAB), an agency designed to settle disputes arising under collective bargaining agreements. Subsection (a) provides that this Board shall consist of 36 members, 18 selected by the carriers, and 18 'by such labor organization of the employees, national in scope, as have been or may be organized in accordance with the provisions of section 2 * * *.'14 Subsection (f) then states that if a dispute arises as to the right of a union to participate in the election of the labor representatives on the NRAB, the Secretary of Labor will notify the Mediation Board if he feels the claim has merit.15 The Mediation Board then constitutes a 'board of three,' consisting of one representative of the claimant union, one representative of the unions already entitled to elect the labor members of the NRAB, and one neutral member selected by the Mediation Board. This board of three then decides whether the claimant union is entitled to be an elector for the NRAB, that is, whether it is 'organized in accordance with section 2 * * * and is otherwise properly qualified to participate in the selection * * *.'16
7
At first glance the language of Section 2, Eleventh (c) would appear to be disarmingly clear: union-shop contracts are satisfied if the employee belongs to any union which happens to be national in scope and organized in accordance with the Act. And if that be its meaning we would then have to deal with the questions reached by the Court of Appeals. However, as so often happens, when the language of the statute is read, not in a vacuum, but in the light of the policies this Section was intended to serve,17 it becomes clear that the purpose of Congress was not, as respondent contends, to give employees in the railroad industry any blanket right to join unions other than the authorized bargaining representative, or to help dissident or rising new unions recruit new members. Rather, the sole aim of the provision was to protect employees from the requirement of dual unionism in an industry with high job mobility, and thus to confer on qualified craft unions the right to assure members employment security, even if a member should be working temporarily in a craft for which another union is the bargaining representative. And this right is given only to those unions which have already qualified as being 'national in scope' and 'organized in accordance with' the Act for the purpose of electing the union members of the NRAB under Section 3.
I.
8
The purposes to be served by Section 2 are clearly revealed by its history. Until 1951 the Railway Labor Act did not permit union-shop contracts in the industry.18 In that year the Congress, persuaded by the established unions that it is unfair to allow nonunion employees to enjoy benefits obtained by the union's efforts in collective bargaining without paying any of the costs, passed Section 2, Eleventh of the Act, which authorized the union shop.19 However, the hearings on the bill20 revealed a problem, peculiar to the railroad industry, in establishing the union shop. Labor in this industry is organized largely on craft rather than industrial lines. Engineers, firemen, trainmen, switchmen, brakemen, and conductors, for example, each are separately organized for the purposes of bargaining. And normally different unions represent different crafts; thus, on the same railroad, firemen might be represented by the Brotherhood of Firemen and Enginemen, and engineers by the Brotherhood of Locomotive Engineers. Yet seasonal and other factors produce a high degree of job mobility for individual employees in the industry, that is, of shuttling back and forth between crafts. For example, a fireman may be temporarily promoted to engineer for a short time, or a conductor might have to serve temporarily as brakeman. Under the ordinary unionshop contract, such a change from craft to craft, even though temporary, would mean that the employee would either have to belong to two unions—one representing each of his crafts or would have to shuttle between unions as he shuttles between jobs. The former alternative would, of course, be expensive and sometimes impossible, while the latter would be complicated and might mean loss of seniority and union benefits.21
9
So Congress faced the problem of reconciling the union shop with some protection to employees who shifted from one craft to another one represented by a different labor organization under a union-shop contract.22 The solution, of course, was evident: to provide that if a fireman, for example, is temporarily promoted to engineer, he can satisfy the union-shop contract of the engineers although still remaining a member of the union representing the firemen.
10
As a result, the Committee reporting the bill to the Senate offered on the Senate floor the following amendment to subsection (a) of Section 2, Eleventh:
11
'Provided further, That no such (union shop) agreement shall require membership in more than one labor organization.'23
12
Senator Hill, manager of the bill, explained the Committee amendment:
13
'This proviso was attached because some question was raised as to the status, under this bill, of employees who are temporarily promoted or demoted from one closely related craft or class to another. This practice, with minor exceptions, occurs only among the trainand engine-service employees. Thus a fireman may be promoted to a position as engineer for a short time and then due to a reduction in force be returned to his former position as fireman. It is the intention of this proviso to assure that in the case of such promotion or demotion, as the case may be, the employee involved shall not be deprived of his employment because of his failure or refusal to join the union representing the craft or class in which he is located if he retains his membership in the union representing the craft or class from which he has been transferred.'24
14
Due to a temporary adjournment of the Senate, no action was taken on this amendment. When the bill was again taken up, however, a substitute amendment, which had been drafted by the railroad brotherhoods, was offered by Senators Hill and Taft.25 The language of this substitute was that of the present Section 2, Eleventh (c), providing that the requirement of membership under a union-shop contract is satisfied if the employee belongs to 'any one of the labor organizations, national in scope, organized in accordance with this Act.'26 Senator Hill explained that the purpose of this substitute was the same as that of the previous amendment:
15
'(The amendment does) nothing more nor less than what the committee desires to do, and what was the intent of the committee in offering its amendment, that no employee of a railroad should be required to belong to more than one labor organization. The only difference between the committee amendment and the amendments now before the Senate, which have been agreed upon by all the railroad organizations, is that the amendments now before the Senate spell out in must more detail the purposes of the committee amendment than did the committee amendment. But the intent and the purpose * * * are exactly the same.'27
16
This amendment passed as introduced28 and now forms subsection (c).
17
It thus becomes clear that the only purpose of Section 2, Eleventh (c) was a very narrow one: to prevent compulsory dual unionism or the necessity of changing from one union to another when an employee temporarily changes crafts.29 The aim of the Section, which was drafted by the established unions themselves,30 quite evidently was not to benefit rising new unions by permitting them to recruit members among employees who are represented by another labor organization. Nor was it intended to provide employees with a general right to join unions other than the designated bargaining representative of their craft, except to meet the narrow problem of intercraft mobility. This is made particularly clear when the provision is taken in the context of American labor relations in general. The National Labor Relations Act contains no paralled to subsection (c), and employees under a union-shop contract governed by that Act must join and maintain membership in the union designated as the bargaining representative or suffer discharge.31 Similarly, subsection (c) does not apply to nonoperating employees, where the problem of seasonal intercraft movement does not exist. Railroad employees such as clerks working under a union-shop contract have no right at all to join a union other than the bargaining representative. In other words, once a union has lawfully established itself for a period of time as the authorized bargaining representative of the employees under a union-shop contract, Congress has never deemed it to be a 'right' of employees to choose between membership in it and another competing union. If Congress intended to confer such a right, it would scarcely have denied the right to nonoperating employees of the railroads or industrial employees under the National Labor Relations Act, 29 U.S.C.A. § 151 et seq. The purpose of Section 2, Eleventh (c) was simply to solve the problem of intercraft mobility under railroad union-shop contracts.
II.
18
There next arises for consideration the manner in which Congress achieved this purpose. Section 2, Eleventh (c) provides that for operating employees a union-shop contract can be satisfied by membership in 'any one of the labor organizations, national in scope, organized in accordance with this Act * * *.' At first blush this would appear to confer on employees a blanket right to choose between alternative unions which are, in the abstract, national in scope and organized in accordance with the Act. But when taken in the context of the Railway Labor Act as a whole, it becomes apparent that this language refers to a certain group of unions, a group already constituted. For the language was borrowed from Section 3, First of the Act, which had been on the books for some 17 years, and which establishes precisely the same qualifications for those unions which are permitted to elect the labor members of the NRAB. Subsection (a) of Section 3, First provides that unions may become electors if they are 'national in scope' and are 'organized in accordance with' the Act.32 Subsection (f) then spells out an impartial administrative method of tripartite arbitration whereby it can be decided whether a particular union meets these qualifications.33 In other words, by writing into Section 2, Eleventh (c), standards identical to those of Section 3, Congress in Section 2 was evidently making reference to those unions which had qualified as electors under Section 3 through the administrative procedure there expressly provided.34 This reference to an already constituted group of unions is emphasized by the fact that Congress in Section 2, Eleventh (c) did not say that an employee under a union-shop contract could join 'any' labor organization which was national in scope and organized in accordance with the Act; rather it said that such an employee could join 'any one of the' labor organizations which are national in scope and organized in accordance with the Act. In short, Congress in Section 2 was referring to a group of unions already defined and constituted under the Section 3 procedures. And therefore an employee has available to him alternative membership only in such unions as have already qualified as electors under Section 3
III.
19
This interpretation of the Act solves the problem which Congress faced without conferring on employees 'floating' rights which Congress did not intend to grant. For the problem of intercraft mobility vanishes if the promoted fireman can remain in the firemen's brotherhood, even though his new craft is represented by a different union; and the firemen's brotherhood will, of course, already have qualified under the Act as an elector under Section 3. Furthermore, this interpretation avoids troublesome questions which would arise were we to hold that employees have a right to belong to any union which happens to be national in scope and organized in accordance with the Act. For, while Section 3, First provides an impartial administrative scheme to deal with precisely this question, Section 2, Eleventh (c), assuming it does not refer to an already defined group of unions qualified under Section 3, is silent on the procedure to determine whether a union meets its requirements. An entire new administrative scheme would have to be fashioned by the courts out of thin air to deal with this question, or the courts themselves would have to deal with it without prior administrative action. If System Boards, for example, are to be given jurisdiction to make such determinations, is there to be judicial review? What is to be the scope of such review? How is the inherent bias of the established-union members of these boards to be overcome? Would the determination of one Board (or one Circuit) that such a union as UROC is 'national in scope' be binding on another Board or another Circuit? Moreover, to sanction such a 'floating' right in employees would make only for confusion and uncertainty in labor relations in the railroad industry. No employee could with safety join an alternative union, for he could not know until after-the-fact adjudication whether that union meets the requirements of Section 2. On the other hand, interpreting Section 2 to refer to those unions which have already qualified as electors under Section 3 means that an employee will always know or can easily ascertain the unions which he can join as an alternative to his bargaining representative. A new union, such as UROC, could make itself available for such alternative membership by seeking certification as an elector through the impartial procedure of Section 3, First (f). And the decision of the 'board of three' provided by that Section would be prospective, uniform throughout the nation, and would be the ruling of an administrative body established to deal with precisely this question.
20
We hold, therefore, that Section 2, Eleventh (c) of the Act makes only such unions available for alternative membership under a union-shop contract, such as this one, as have already qualified as electors for the labor members of the NRAB under Section 3, First. Since UROC has not so qualified, respondent has not stated a claim on which relief can be granted. The decision below must therefore be reversed and the case remanded to the District Court with instructions to dismiss the complaint.
21
Reversed and remanded.
22
Mr. Justice BLACK took no part in the consideration or decision of this case.
23
Reversed and remanded with instructions to dismiss the complaint.
24
Mr. Justice FRANKFURTER, concurring.
25
The decision below, if allowed to stand, would tend to dislocate the scheme that Congress has seen fit to devise for the regulation of industrial relations on railroads, and so I join in reversing the judgment. But I get there by a different route from the Court's. In my view of the Railway Labor Act, the District Court had no jurisdiction of this action and the complaint should be dismissed for want of it, not on the merits.
26
The governing outlook for construing the Railway Labor Act is hospitable realization of the fact that it is primarily an instrument of industrial government for railroading by the industry itself, through the concentrated agencies of railroad executives and the railroad unions. For details, see the dissenting opinions in Elgin, Joliet & Eastern R. Co. v. Burley, 325 U.S. 711, 749, 65 S.Ct. 1282, 1302, 89 L.Ed. 1886; Id., 327 U.S. 661, 667, 66 S.Ct. 721, 723, 90 L.Ed. 928. The dominant inference that the Court has drawn from this fact is exclusion of the courts from this process of collaborative self-government. See, e.g., General Committee, etc., v. Missouri-Kansas-Texas R. Co., 320 U.S. 323, 64 L.Ct. 146, 88 L.Ed. 76; Order of Railway Conductors v. Pitney, 326 U.S. 561, 66 S.Ct. 322, 90 L.Ed. 318; Slocum v. Delaware, Lackawanna & Western R. Co., 339 U.S. 239, 70 S.Ct. 577, 94 L.Ed. 795. Neither Moore v. Illinois Central R. Co., 312 U.S. 630, 61 S.Ct. 754, 85 L.Ed. 1089, nor Order of Railway Conductors v. Swan, 327 U.S. 520, 67 S.Ct. 405, 91 L.Ed. 471, is fairly to be deemed an exception to the general principle and, in any event, those cases involve circumstances not relevant to the present situation.
27
There is one qualification to the principle I have stated, or, rather, there is a counter-principle to be respected. This is the doctrine established by Steele v. Louisville & N.R. Co., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173. The short of it is that since every railroad employee is represented by union agents who sit on a System Board of Adjustment, such representatives are in what amounts to a fiduciary position: they must not exercise their power in an arbitrary way against some minority interest. The fact of a general conflict of interest between a minority of union members and representatives designated by the majority does not of itself vitiate the presupposition of self-government and does not of itself subject the System Board action to judicial review. Conflict between a majority and a minority is a commonplace in the whole collective bargaining process. But the bargaining representatives owe a judicially enforceable duty of fairness to all the commonents of the working force when a specific claim is in controversy.
28
The determination of the System Board on the merits is not open to judicial review, even on so-called legal questions. It is not for a court to say that a complaint against the System Board must fail because the System Board rightly held against the complainant. Right or wrong, a court has no jurisdiction to review what the System Board did, unless a complainant asserts arbitrariness and seeks to enforce the limited protection established in the Steele case. It is not for a court to decide as an abstract issue what procedure a union must or may pursue to establish its status as an organization 'national in scope,' within § 2, Eleventh (c) of the Railway Labor Act, nor whether or when an individual claiming through such a rival union may assert its claim for his benefit. As bearing on the legal complexities raised by such interrelationship between a member and an organization, see the opinion of Mr. Justice Jackson in Joint Anti-Fascist Refugee Committee v. McGrath, 341 U.S. 123, 183, 71 S.Ct. 624, 654, 95 L.Ed. 817.
29
For Rychlik to have brought himself within the Steele case it would have been necessary to charge that the System Board had made its determination arbitrarily and that on the basis of this arbitrary determination he had been discharged. On such a claim, and only on such a claim, would he have been entitled to judicial relief. In the absence of such a claim, the District Court was without jurisdiction to entertain the complaint.
1
64 Stat. 1238 (1951), 45 U.S.C. § 152, Eleventh (a) and (c), 45 U.S.C.A. § 152, subd. 11(a, c). These and other pertinent provisions of the statute are discussed later.
2
48 Stat. 1189 (1934), 45 U.S.C. § 153, First, 45 U.S.C.A. § 153, subd. 1.
3
48 Stat. 1193 (1934), 45 U.S.C. § 153, Second, 45 U.S.C.A. § 153, subd. 2. This Section authorizes carriers and unions to set up 'system, group, or regional boards of adjustment' to decide disputes otherwise within the jurisdiction of the National Railroad Adjustment Board, with a right in any party, dissatisfied with such an arrangement, to return to the jurisdiction of the Adjustment Board upon 90 days' notice. No such election was made here.
4
The first hearing was on August 27, 1953, at which time the Board postponed decision pending further exploration into the status of UROC. The second hearing was on August 23, 1954. In the interim, Rychlik, on July 31, 1954, had joined the Switchmen's Union, and presented evidence of that membership at the second hearing. Rychlik's employment was continued until shortly after the Board's adverse decision on January 3, 1955.
5
128 F.Supp. 449, 452. The District Court, holding in effect that its jurisdiction to review the System Board was limited to ascertaining whether the Board had acted within the scope of its statutory and contract authority and whether its decision was free of fraud or corruption and the hearing consonant with procedural due process, found that no such infirmities had been shown, and in particular that the presence of two Brotherhood representatives on the System Board did not automatically vitiate its proceedings. It further held that Rychlik's belated membership in the Switchmen's Union did not satisfy the statutory and contract requirements of continuous maintenance of membership in a qualified union, and that the court need not decide whether UROC was a labor organization 'national in scope,' since, under Section 3, First (f) of the Railway Labor Act, determination of that question was within the exclusive competence of the National Mediation Board. See 352 U.S. 487, 77 S.Ct. 425, infra.
6
229 F.2d 171.
7
The briefs below show that the validity of this premise was not challenged by any of the parties before the Court of Appeals.
8
As to this issue the Court of Appeals relied on its previous decision in United Railroad Operating Crafts v. Wyer, 2 Cir., 205 F.2d 153.
9
Neither in the Court of Appeals, nor here, has Rychlik claimed that his membership in the Switchmen's Union made his discharge illegal. In both courts he has stood only upon his membership in UROC.
10
Pigott v. Detroit, Toledo & Ironton R. Co., 221 F.2d 736.
11
No contention is made that, apart from the statute, respondent had a cause of action on the union-shop contract itself, that is, that the contract conferred on him rights wider than those given as a matter of federal right by the statute. On such a cause of action federal jurisdiction would depend on showing diversity of citizenship.
12
'Notwithstanding any other provisions of this Act * * * any carrier or carriers as defined in this Act and a labor organization or labor organizations duly designated and authorized to represent employees in accordance with the requirements of this Act shall be permitted—
'(a) to make agreements, requiring, as a condition of continued employment, that within sixty days following the beginning of such employment, or the effective date of such agreements, whichever is the later, all employees shall become members of the labor organization representing their craft or class: Provided, That no such agreement shall require such condition of employment with respect to employees to whom membership is not available upon the same terms and conditions as are generally applicable to any other member or with respect to employees to whom membership was denied or terminated for any reason other than the failure of the employee to tender the periodic dues, initiation fees, and assessments (not including fines and penalties) uniformly required as a condition of acquiring or retaining membership.' 64 Stat. 1238 (1951), 45 U.S.C. § 152, Eleventh (a), 45 U.S.C.A. § 152, subd. 11(a).
13
Italics supplied. The full taxt of the section is: 'The requirement of membership in a labor organization is an agreement made pursuant to subparagraph (a) shall be satisfied, as to both a present or future employee in engine, train, yard, or hostling service * * * if said employee shall hold or acquire membership in any one of the labor organizations, national in scope, organized in accordance with this Act and admitting to membership employees of a craft or class in any of said services; and no (checkoff) agreement made pursuant to subparagraph (b) shall provide for deductions from his wages for periodic dues, initiation fees, or assessments payable to any labor organization other than that in which he holds membership: Provided, however, that as to an employee in any of said services on a particular carrier at the effective date of any such agreement on a carrier, who is not a member of any one of the labor organizations, national in scope, organized in accordance with this Act and admitting to membership employees of a craft or class in any of said services, such employee, as a condition of continuing his employment, may be required to become a member of the organization representing the craft in which he is employed on the effective date of the first agreement applicable to him: Provided, further, That nothing herein or in any such agreement or agreements shall prevent an employee from changing membership from one organization to another organization admitting to membership employees of a craft or class in any of said services.' 64 Stat. 1238 (1951), 45 U.S.C. § 152, Eleventh (c), 45 U.S.C.A. § 152, subd. 11(c).
14
48 Stat. 1189 (1934), 45 U.S.C. § 153, First (a), 45 U.S.C.A. § 153, subd. 1(a). (Italics supplied.)
15
The National Mediation Board was set up by Section 4, First of the Act. 48 Stat. 1193 (1934), 45 U.S.C. § 154, First, 45 U.S.C.A. § 154, subd. 1. It is an independent federal agency with three members, appointed by the President with the advice and consent of the Senate. Its function, in the main, is to try to settle 'major' disputes in the railroad industry, which are not within the jurisdiction of the NRAB.
16
The full text of subsection (f) is: 'In the event a dispute arises as to the right of any national labor organization to participate as per paragraph (c) of this section in the selection and designation of the labor members of the Adjustment Board, the Secretary of Labor shall investigate the claim of such labor organization to participate, and if such claim in the judgment of the Secretary of Labor has merit, the Secretary shall notify the Mediation Board accordingly, and within ten days after receipt of such advice the Mediation Board shall request those national labor organizations duly qualified as per paragraph (c) of this section to participate in the selection and designation of the labor members of the Adjustment Board to select a representative. Such representative, together with a representative likewise designated by the claimant, and a third or neutral party designated by the Mediation Board, constituting a board of three, shall within thirty days after the appointment of the neutral member, investigate the claims of the labor organization desiring participation and decide whether or not it was organized in accordance with section 2 hereof and is otherwise properly qualified to participate in the selection of the labor members of the Adjustment Board, and the findings of such boards of three shall be final and binding.' 48 Stat. 1190 (1934), 45 U.S.C. § 153, First (f), 45 U.S.C.A. § 153, subd. 1(f).
17
See Frankfurter, Some Reflections on the Reading of Statutes, in The Record of the Association of the Bar of the City of New York, Volume 2, No. 6 (1947).
18
In 1934 a prohibition against the union shop and the checkoff was put into the Railway Labor Act at the request of the unions themselves, since employers had used these devices to establish and maintain company unions. See S.Rep. No. 2262, 81st Cong., 2d Sess., pp. 2—3 (1950), U.S.Code Cong.Service 1950, p. 4319; Hearings before the House Committee on Interstate and Foreign Commerce, on H.R. 7789, 81st Cong., 2d Sess., pp. 3—4, 7 8, 16—17 (1950).
19
See id., at pp. 10, 28, 29, 37; H.R.Rep. No. 2811, 81st Cong., 2d Sess., p. 4 (1950).
20
Hearings before the House Committee on Interstate and Foreign Commerce, on H.R. 7789, 81st Cong., 2d Sess. (1950); Hearings before a Senate Subcommittee of the Committee on Labor and Public Welfare, on S. 3295, 81st Cong., 2d Sess. (1950).
21
House Hearings, supra, at pp. 30—31, 32—33, 35—36, 42—43, 78—81, 126, 192—194; Senate Hearings, supra, at pp. 18—19, 67—68, 69, 73, 78—79. See also Levinson, Union Shop Under the Railway Labor Act, 6 Labor L.J. 441, 443—448 (1955).
22
See H.R.Rep. No. 2811, supra, at pp. 5—6.
23
96 Cong.Rec. 15735.
24
Id., at 15736.
25
Id., at 16268.
26
See note 13, supra.
27
96 Cong.Rec. 16268. See also id., at 16261, 16328—16330.
28
Id., at 16268.
29
Had Congress wanted to confer blanket 'union-shopping' rights on employees, it presumably would have allowed nonmembers of a union to join any union (qualified under Section 2, Eleventh) at the time a union-shop agreement was first put into effect. However, the next-to-last proviso of Section 2, Eleventh (c) states that when a union-shop provision is first signed, employees not belonging to a qualified union may be required to join that union which represents the craft in which they are employed at the time the agreement becomes effective. See note 13, supra. Thus when this agreement between petitioners was first put into effect, Rychlik, had he belonged to no union at all, would have been required to join the Brotherhood specifically, and could not have chosen to join even such competing unions which are concededly national in scope, not to speak of UROC. In other words, this proviso completely negates the argument that the purpose of the statute was to allow employees to choose between unions.
30
See Senator Hill's statement, 96 Cong.Rec. 16329: 'The representatives of the railway organizations sat around a table together and worked out the details of the amendment, and then brought it to the Senator from Ohio and the Senator from Alabama, and we saw that the amendment was exactly similar to the committee amendment, except that it spelled out in more detail the safeguards which were deemed necessary in order to properly do the job.'
31
See Levinson, supra, note 21.
32
See note 14, supra. The 'organized in accordance' language refers to Section 2, Fourth, which prohibits company unions, and which had also been on the books since 1934. 48 Stat. 1187 (1934), 45 U.S.C. § 152, Fourth, 45 U.S.C.A. § 152, subd. 4.
33
See note 16, supra.
34
Respondent argues that the standards of Section 3 are not the same as those of Section 2, Eleventh (c), and that therefore the latter provision cannot refer to the unions qualified under the former. He points out that Section 3, First (f) makes it the duty of the board of three to determine whether the claimant union is 'organized in accordance with section 2 hereof and is otherwise properly qualified to participate in the selection of the labor members of the Adjustment Board,' and argues that the words 'otherwise properly qualified' must refer to qualifications not listed in Section 2, Eleventh (c). But we think it clear that these words merely incorporate by reference the qualifications listed in Section 3, First (a) for union electors, and the latter section defines these qualifications in terms indentical to the union-shop section. See 69 Harv.L.Rev. 1512, 1514.
| 67
|
352 U.S. 370
77 S.Ct. 415
1 L.Ed.2d 404
Jacob SENKO, Petitioner,v.LA CROSSE DREDGING CORPORATION.
No. 62.
Argued Dec. 12, 1956.
Decided Feb. 25, 1957.
Rehearing Denied April 8, 1957.
See 353 U.S. 931, 77 S.Ct. 716.
Mr. George J. Moran, Granite City, Ill., for the petitioner.
Mr. Stuart B. Bradley, Chicago, Ill., for the respondent.
Mr. Justice REED delivered the opinion of the Court.
1
Petitioner was employed by respondent to assist with dredging operations being conducted by respondent in a slough dug to by-pass a rocky section of the Mississippi River. His work was that of a handyman; it included the carrying and storing of supplies, and the general maintenance of a dredge. He was injured by the explosion of a coal stove while placing signal lanterns from the dredge in a shed on the neighboring bank. He filed this suit under the Jones Act in the City Court of Granite City, Illinois, to recover damages for his injuries. The Act provides a cause of action for 'any seaman who shall suffer personal injury in the course of his employment.' 41 Stat. 1007, 46 U.S.C. § 688, 46 U.S.C.A. § 688. This Court, however, has held that the Longshoremen's and Harbor Workers' Compensation Act of March 4, 1927, 44 Stat. 1424, 33 U.S.C. § 901 et seq., 33 U.S.C.A. § 901 et seq., restricts the benefits of the Jones Act to 'members of the crew of a vessel.' Swanson v. Marra Bros., Inc., 328 U.S. 1, 66 S.Ct. 869, 872, 90 L.Ed. 1045. To recover, therefore, petitioner had to be a member of a crew, as that term is used in the Longshoremen's Act, at the time of his injury.
2
The jury returned a verdict for petitioner and judgment was entered in his favor. On appeal the Fourth District Appellate Court of the State of Illinois held that there was insufficient evidence to support the finding that petitioner was a member of a crew.1 Accordingly. it reversed the trial court and entered judgment for respondent. Senko v. LaCrosse Dredging Corp., 7 Ill.App.2d 307, 129 N.E.2d 454. The Illinois Supreme Court denied a petition for an appeal. We granted certiorari. 351 U.S. 949, 76 S.Ct. 848, 100 L.Ed. 1473.
3
In South Chicago Coal & Dock Co. v. Bassett, 309 U.S. 251, 60 S.Ct. 544, 84 L.Ed. 732, we said that whether or not an employee is "a member of a crew' turns on questions of fact' and that, if a finding on this question has evidence to support it, the finding is conclusive. Id., 309 U.S. at pages 257—258, 60 S.Ct. at pages 547 548.2 The sole question presented here, therefore, is whether there is an evidentiary basis for the jury's finding that petitioner was a member of a crew at the time of his injury. This finding was made under specific instructions not objected to here.
4
The appellate court characterized petitioner as
5
'an employee whose principal duty is to load supplies on a vessel at anchor, and to perform incidental tasks of a common labor character * * *.' 7 Ill.App.2d at page 313, 129 N.E.2d at page 457.
6
They also noted that petitioner lived ashore and was not aboard except when the vessel was anchored. The court concluded that petitioner was not 'naturally and primarily on board to aid in navigation' and could not 'maintain an action under the Jones Act.' 7 Ill.App.2d at pages 313—314, 129 N.E.2d at page 457.
7
It is true that the dredge was anchored to the shore at the time of petitioner's injury and during all the time petitioner worked for respondent. It is also true that this dredge, like most dredges, was not frequently in transit. We believe, however, that there is sufficient evidence in the record for the jury to decide that petitioner was permanently attached to and employed by the dredge as a member of its crew.
8
Petitioner's witnesses testified that he was known as a 'deckhand' among rivermen. They said that he was hired to clean and take care of the deck, splice rope, stow supplies, and, in general, to keep the dredge 'in shape.' This testimony indicated that substantially all of petitioner's duties were performed on or for the dredge. A normal inference is that petitioner was responsible for its seaworthiness. If the dredge leaked, for example, the jury could suppose that his job would be to repair the leak. Furthermore, a witness testified that a usual duty of one holding petitioner's job was to take soundings and clean navigation lights when the dredge was in transit. 7 Ill.App.2d at page 310, 129 N.E.2d at pages 455—456. Here again, the jury could reasonably have believed that petitioner would have these responsibilities in the event that this dredge were moved. Whether petitioner would be a member of the dredge's crew while taking soundings during a trip is certainly a jury question. If he were a member during travel, he would not necessarily lack that status during anchorage. Even a transoceanic liner may be confined to berth for lengthy periods, and while there the ship is kept in repair by its 'crew.' There can be no doubt that a member of its crew would be covered by the Jones Act during this period, even though the ship was never in transit during his employment. In short, the duties of a man during a vessel's travel are relevant in determining whether he is a 'member of a crew' while the vessel is anchored. Thus, the fact that this dredge was connected to the shore cannot be controlling.
9
The fact that petitioner's injury occurred on land is not material. Admiralty jurisdiction and the coverage of the Jones Act depends only on a finding that the injured was 'an employee of the vessel, engaged in the course of his employment' at the time of his injury. Swanson v. Marra Bros., Inc., 328 U.S. 1, 4, 66 S.Ct. 869, 870, citing O'Donnell v. Great Lakes Dredge & Dock Co., 318 U.S. 36, 63 S.Ct. 488, 87 L.Ed. 596.3
10
As we have said before, this Court does not normally sit to re-examine a finding of the type that was made below. We believe, however, that our decision in South Chicago Coal & Dock Co. v. Bassett, supra, has not been fully understood. Our holding there that the determination of whether an injured person was a 'member of a crew' is to be left to the finder of fact meant that juries have the same discretion they have in finding negligence or any other fact. The essence of this discretion is that a jury's decision is final if it has a reasonable basis, whether or not the appellate court agrees with the jury's estimate.
11
Because there was testimony introduced by petitioner tending to show that he was employed almost solely on the dredge, that his duty was primarily to maintain the dredge during its anchorage and for its future trips, and that he would have a significant navigational function when the dredge was put in transit, we hold there was sufficient evidence in the record to support the finding that petitioner was a member of the dredge's crew. Cf. Gianfala v. Texas Co., 350 U.S. 879, 76 S.Ct. 141, 100 L.Ed. 775, reversing 5 Cir., 222 F.2d 382. Accordingly, we reverse the decision below.
12
Respondent, on its appeal from the trial court's judgment, raised two questions which the appellate court did not reach because of its disposition of the case.4 So that these issues may be reviewed, we remand the case to that court. It is so ordered.
13
Reversed and remanded.
14
Mr. Justice HARLAN, whom Mr. Justice FRANKFURTER and Mr. Justice BURTON join, dissenting.
15
In my opinion the court below properly dismissed the complaint because the evidence shows affirmatively that petitioner was not a member of a 'crew of a vessel,'1 as that term has heretofore been used by the courts, or indeed according to any commonly understood meaning of the expression. Since the passage of the Longshoremen's Act in 1927,2 such membership has been a prerequisite to the right to sue under the Jones Act.3 Swanson v. Marra Bros., 328 U.S. 1, 66 S.Ct. 869, 90 L.Ed. 1045.
16
According to past decisions, to be a 'member of a crew' an individual must have some connection, more or less permanent, with a ship and a ship's company.4 More particularly, this Court has said that he must be 'naturally and primarily on board to aid in * * * navigation,' as distinguished from those 'serving on vessels, to be sure, but (whose) service was that of laborers, of the sort performed by longshoremen and harbor workers.' Congress intended to remove from the converage of the Jones Act 'all those various sorts of longshoremen and harbor workers who were performing labor on a vessel.' South Chicago Coal & Dock Co. v. Bassett, 309 U.S. 251, 260, 257, 60 S.Ct. 544, 549, 548.
17
Petitioner's relationship to this dredge met none of these requirements. He was simply an ordinary laborer, a member of the Common Laborers' Union. Temporarily unemployed, he applied to his union, which sent him to respondent as a laborer. Respondent was a contractor on the canal-digging project, and employed a construction gang on shore under the supervision of a foreman. This foreman assigned Senko to take the job of 'deckhand' or 'laborer' on respondent's dredge, the James Wilkinson, a craft which, though afloat, served as a stationary earth-removing machine. His duties there were miscellaneous, consisting of serving as assistant and handy-man to the team of men operating the earth-removing pumps. He carried supplies from shore to dredge and back, cleaned up the dredge, filled the water cooler, and did errands on shore. He worked an eight-hour shift, was paid by the hour, and received premium pay for overtime. He lived at home, drove to work every day, and brought his own meals. He did not belong to the National Maritime Union or any other seamen's organization. He was subject to the discipline and supervision not of officers of a vessel but of the labor foreman in charge of the construction project, who worked on shore. At any time Senko could have been shifted to a job on shore by the foreman and replaced with one of the shore laborers; in other words, his connection was not with the vessel but with the construction gang. He had no duties connected with navigation; in fact he had never been on the dredge when it was pushed from one location to another, and never even saw it moved.
18
There is nothing in the record to indicate that petitioner was responsible for the seaworthiness of the dredge, or that he ever performed or was qualified to perform any duties of that type. True, he cleaned lights, but these were not 'navigation' lights, as the dredge did not carry the latter except when under tow. In effect he cleaned lanterns and placed them when the construction work continued at night. Again, he took 'soundings,' but in spite of the maritime flavor of the phrase, the facts permit no salty inference, since the soundings were taken not in aid of navigation (the dredge being completely stationary at such times), but only to measure the amount of silt pumped from the canal. All this means is that Senko occasionally measured the work-progress on an earth-removal project, a task about as nautical as measuring the depth of a natural swimming pool under construction in marshy ground.
19
I do not think that these facts permit a finding that petitioner was a 'member of a crew,' more or less permanently connected with a ship's company and on board 'naturally and primarily' in aid of navigation. His nexus was not with a ship's company but with a construction crew on shore. He signed no papers to join the vessel and his employment was governed by no 'articles'; he was merely assigned by the Laborers' Union 'pusher' to this particular task on an earth-removing project. His boss was not a ship's officer but a construction superintendent whose office was on land. In fact the record is bare of any of the things which common sense demands of a 'ship's company.' There was no captain, no master, no mate, no ship's papers or ship's discipline, no log, no galley, no watches to stand. And to say that Senko's job was naturally and primarily in aid of navigation can be done, it seems to me, only at the cost of removing from those words all semblance of content. Not only did Senko have nothing to do with navigation, but he did not 'aid' navigation in the sense of helping to maintain the vessel or its crew in a condition to navigate.5 He was simply a handy-man and assistant for a crew of men operating an earth-removing machine which happened to be afloat and which, occasionally and always in Senko's absence, was pushed from place to place.
20
The fact that it was a jury that found Senko to be 'a member of a crew' does not relieve us of the responsibility for seeing to it that what is in effect a jurisdictional requirement of the Jones Act is obeyed. This Court has more than once reviewed similar determinations of other fact-finding bodies, and set them aside when satisfied that they did not meet the requirements of the Jones Act or Longshoremen's Act. Cantey v. McLain Line, Inc., 312 U.S. 667, 61 S.Ct. 829, 85 L.Ed. 1111; Norton v. Warner Co., 321 U.S. 565, 64 S.Ct. 747, 88 L.Ed. 430; Desper v. Starved Rock Ferry Co., 342 U.S. 187, 72 S.Ct. 216, 96 L.Ed. 205. The reason is, of course, as the Court said in the Norton case, supra, that 'where Congress has provided that those basic rights (conferred by the Jones Act) shall not be withheld from a class or classes of maritime employees it is our duty on judicial review to respect the command and not permit the exemption (arising from the Longshoremen's Act) to be narrowed whether by administrative construction or otherwise.' 321 U.S. at page 571, 64 S.Ct. at page 751.6 I cannot see why this same sound reasoning should not apply in reverse, that is, where Congress has provided that a right shall be withheld from a certain class, and where that class has been narrowed by the 'construction' of some fact-finding body. Nor, I submit, should it make any difference that such a body is a jury.7 A jury's verdict casts no such spell as should lead the Court to permit it to rob this restriction of the Jones Act of meaningful significance. This, in my opinion, is what today's decision permits.8
21
I would affirm the decision of the court below. This would not leave petitioner without a remedy. He has already applied for and secured workmen's compensation under the Illinois Workmen's Compensation Act, S.H.A. ch. 48, § 138.1 et seq. This is the relief which Congress intended him to have, and I would not add to it another remedy denied by Congress.
1
Although two other grounds were advanced on appeal, only this one was considered. See n. 4, infra. No question has been raised at any time as to whether the dredge involved here had the status of a 'vessel' at the time of petitioner's injury.
2
The finder of fact in the Bassett case was a commissioner, but that holding applies with equal force to this case in which the finder was a jury.
3
'The admiralty and maritime jurisdiction of the United States shall extend to and include all cases of damage or injury, to person or property, caused by a vessel on navigable water, notwithstanding that such damage or injury be done or consummated on land.' 62 Stat. 496, 46 U.S.C. § 740, 46 U.S.C.A. § 740.
4
'2, the dredge was not operating in navigable waters; and 3, there was no evidence of negligence on its part and no basis to apply the doctrine of res ipsa loquitur.' 7 Ill.App.2d, at page 309, 129 N.E.2d at page 455.
1
It is assumed that this dredge may properly be regarded as a 'vessel.' And, with the Court, I do not reach the question of whether the swampy land in which the dredge was operating could be deemed 'navigable water,' an additional factor conditioning the applicability of the Jones Act.
2
33 U.S.C. § 901 et seq., 33 U.S.C.A. § 901 et seq.
3
46 U.S.C. § 688, 46 U.S.C.A. § 688.
4
See Warner v. Goltra, 293 U.S. 155, 55 S.Ct. 46, 79 L.Ed. 254; South Chicago Coal & Dock Co. v. Bassett, 309 U.S. 251, 60 S.Ct. 544, 84 L. 732; Norton v. Warner Co., 321 U.S. 565, 64 S.Ct. 747, 88 L.Ed. 430; Desper v. Starved Rock Ferry Co., 342 U.S. 187, 72 S.Ct. 216, 96 L.Ed. 205; The Bound Brook, D.C., 146 F. 160, 164; The Buena Ventura, D.C., 243 F. 797; Seneca Washed Gravel Corp. v. McManigal, 2 Cir., 65 F.2d 779; De Wald v. Baltimore & Ohio R. Co., 4 Cir., 71 F.2d 810; Diomede v. Lowe, 2 Cir., 87 F.2d 296; Moore Dry Dock Co. v. Pillsbury, 9 Cir., 100 F.2d 245; Wilkes v. Mississippi River Sand & Gravel Co., 6 Cir., 202 F.2d 383, 388.
5
I do not, of course, contend that men such as ship's cooks cannot be members of a crew merely because their actual jobs have nothing to do with making the vessel move. The vital distinction is that such men do contribute to the functioning of the vessel as a vessel—as a means of transport on water. Not so Senko, whose duties had absolutely nothing to do with the dredge in its aspects as a vessel.
6
It is worth noting that in Norton, where the Court reversed a determination by a Commissioner that a bargeman in general charge of a barge was not a member of a crew, all of the factors on which the Court relied are conspicuously absent here.
7
Certainly South Chicago Coal & Dock Co. v. Bassett, supra, upon which the Court relies, does not suggest that a jury's verdict on this issue is to be accorded some special sanctity. That case simply held that a District Court could not grant a trial de novo on an issue within the primary jurisdiction of the Administrator, under the Longshoremen's Act. There is no comparable fact-finding procedure under the Jones Act. Moreover, despite the fact that the Longshoremen's Act gave the Administrator 'full power and authority to hear and determine all questions in respect of' claims under the Act, this Court did in fact examine the Administrator's determination that the plaintiff there was not a member of a crew, and sustained it only after concluding that it was supported by the evidence. Further, the Court's citation of Bassett in Cantey v. McLain Line, Inc., supra, would seem in context to imply that the Court regarded the result in Bassett as reflecting its own independent determination as to the status of the petitioner there, rather than as a decision passing merely on the scope of judicial review to be accorded to the determination of the Administrator. And, if that be so, Bassett should surely control the result here, since if the Bassett petitioner was as a matter of law not a 'member of a crew,' a fortiori, Senko was not.
8
Gianfala v. Texas Co., 350 U.S. 879, 76 S.Ct. 141, 100 L.Ed. 775, should not be regarded as an abstacle to reaching what, in my view, is plainly the right result here. The petitioner in Gianfala at least played a part in the operation of moving the barge, and thus arguably was performing a function 'in aid of' navigation. Moreover, the per curiam order in Gianfala, entered solely on the basis of the petition for certiorari, without the benefit of an opposing brief or oral argument, can scarcely be regarded as a precedent of much significance.
| 78
|
352 U.S. 354
77 S.Ct. 481
1 L.Ed.2d 393
Thomas E. POLLARD, Petitioner,v.UNITED STATES of America.
No. 38.
Argued Dec. 3, 1956.
Decided Feb. 25, 1957.
Mr. Bennett Boskey, Washington, D.C., for the petitioner.
Mr. Philip Elman, Washington, D.C., for the respondent.
Mr. Justice REED delivered the opinion of the Court.
1
This case concerns the validity of a sentence imposed on petitioner in September 1954. On September 8, 1952, petitioner pleaded guilty in the United States District Court for the District of Minnesota to an information charging him with the unlawful taking and embezzlement of a United States Treasury check in violation of 18 U.S.C. § 1702, 18 U.S.C.A. § 1702. The district judge deferred imposition of sentence pending presentence investigation. On October 3, 1952, petitioner appeared before the trial judge at 10 a.m. for sentencing. He was then serving a sentence in a Minnesota state prison, from which he was eligible for parole the following month. The judge stated that the probation report showed that petitioner had taken an active interest in the Alcoholics Anonymous organization in prison, and petitioner told him that he contemplated continuing that interest when he was released from the state prison. The judge added that he was impressed by the fact that petitioner, who had stolen the check after a two-week drinking spree, had revealed what he had done to an officer of Alcoholics Anonymous and to the FBI without any effort to minimize the offense. He advised petitioner to join Alcoholics Anonymous immediately on his release from the state prison. He then said:
2
'* * * if you want to revert to drinking, you will be back here again because you will commit some federal offense, and I won't be talking to you this way if you are ever before me again.
3
'So, good luck to you and I hope the parole board will give you an opportunity.
4
'That is all.'
5
The judge then turned to other business.
6
It is clear that no explicit reference to petitioner's sentence had been made during this colloquy. But before the court adjourned at 10:30 a.m., when petitioner apparently had left the courtroom, an assistant United States District Attorney handling the matter said:
7
'Going back to the matter of Thomas E. Pollard who appeared this morning—I didn't quite understand that clearly—is there to be a probationary period after his release from Stillwater, or any type of sentencing?
8
'The Court: It is to commence at the expiration of sentencing at Stillwater.
9
'Mr. Hachey: Probation to commence after expiration of his sentencing at Stillwater—for how long?
10
'The Court: Three years.'
11
A judgment and order of probation was then entered suspending imposition of sentence and placing petitioner on probation for that term. The Government concedes that the judgment and order was invalid because of petitioner's absence from the courtroom when probation was imposed. Fed.Rules Crim.Proc., rule 43, 18 U.S.C.A.
12
Petitioner did not receive a copy of this order, despite a direction of the court, but learned of the probation from state prison officials the following month when he was paroled. On his release he begain reporting to the federal probation officer. Nearly two years later, on September, 1, 1954, the trial judge issued a bench warrant for petitioner's arrest on the basis of the probation officer's report that petitioner had violated the terms of his probation. Petitioner was arrested and brought before the court on September 21, 1954. After waiver of counsel by petitioner, the following occurred at the hearing:
13
'The Court: What I am going to do in your case, because of the record, is to sentence you in the first instance: It's the judgment of the Court that you be confined in an institution to be selected by the Attorney General of the United States for a period of two years. That's all.
14
'Mr. Evarts (Asst. U.S. Attorney): Now, Your Honor, as you recall, the record shows that he was, sentence was imposed on October 3, 1952, and I would suggest to the Court that an Order be made setting aside the judgment and commitment that was entered at that time so that the record will now truly reflect the status of the events.
15
'The Court: All right.'
16
A formal judgment and commitment was then entered, sentencing petitioner to two years' imprisonment and setting aside the judgment and order of probation entered on October 3, 1952.
17
Petitioner's motion to vacate this sentence under 28 U.S.C. § 2255, 28 U.S.C.A. § 2255, was based upon a misapprehension of the basis for the sentence of 1954. He contended that, since his 1952 probation sentence was invalid, his 1954 prison sentence was also invalid because it was for probation violation. Actually, of course, it was punishment for the embezzlement. The District Court denied the motion on the ground that '(Petitioner) was initially sentenced upon September 21, 1954, and the files and records in the case conclusively show that said judgment was within the jurisdiction of the court and the sentence imposed was valid and in accordance with law.' Petitioner filed a notice of appeal and a motion for leave to proceed in forma pauperis. The District Court denied this motion 'in all respects.' Petitioner then filed a motion for leave to appeal in forma pauperis in the Court of Appeals for the Eighth Circuit. After examination of the record in the District Court, the Court of Appeals denied this motion without opinion. This Court granted leave to proceed in forma pauperis, and, deeming the issues as to the validity of the 1954 sentence of importance in the proper administration of the criminal law granted certiorari. 350 U.S. 965, 76 S.Ct. 441, 100 L.Ed. 838. We also appointed counsel for petitioner. 350 U.S. 980, 76 S.Ct. 470, 100 L.Ed. 849.
18
Petitioner was released from federal prison in March 1956, after his petition for certiorari had been granted. He relies on United States v. Morgan, 346 U.S. 502, 512—513, 74 S.Ct. 247, 253, 98 L.ed. 248, and Fiswick v. United States, 329 U.S. 211, 220—223, 67 S.Ct. 224, 229, 230, 91 L.Ed. 196, as meeting the question of mootness that this fact suggests. Those cases are not entirely on all fours with this one, since petitioner is challenging the legality not of any determination of guilt, but instead of the sentence imposed. But those cases recognize that convictions may entail collateral legal disadvantages in the future. Appeals from convictions are allowed only after sentences. Fed.Rules Crim.Proc., 37. The determination of guilt and the sentence are essential for imprisonment. We think that petitioner's reference to the above cases sufficiently satisfies the requirement that review in this Court will be allowed only where its judgment will have some material effect. Cf. St. Pierre v. United States, 319 U.S. 41, 63 S.Ct. 910, 87 L.Ed. 1199. The possibility of consequences collateral to the imposition of sentence is sufficiently substantial to justify our dealing with the merits.1
19
The petition for certiorari, pro se, sought reversal of the order of the Court of Appeals denying petitioner's motion for appeal in forma pauperis and also release from his then incarceration.2 Petitioner contended that the 1954 sentence was unconstitutional because it was imposed for violation of the invalid probation order.
20
Petitioner now, in his brief, claims that the trial judge determined on October 3, 1952, that no imprisonment and no probation should be imposed, and that consequently the imposition of sentence in September 1954 violated the Double Jeopardy Clause of the Fifth Amendment. He claims alternatively that the imposition of sentence in September 1954 in the circumstances under which it took place constituted a serious departure from proper standards of criminal law administration and violated his rights to a speedy trial under the Sixth Amendment and to due process of law under the Fifth Amendment.3 The record now before us adequately states the facts for a final determination of the basic issues. Since the Court of Appeals' denial of petitioner's appeal involved an adjudication of the merits, i.e., that there was no adequate basis for allowance of appeal in forma pauperis, we think the validity of the 1954 sentence for embezzlement should now be decided. And we conclude that it is proper that we deal with the questions as to legality of the 1954 sentence that petitioner now raises, although, had petitioner been represented by counsel in the courts below and upon his petition for certiorari, we might well have considered those questions neither preserved below nor raised in the petition. Cf. Price v. Johnston, 334 U.S. 266, 292, 68 S.Ct. 1049, 1063, 92 L.Ed. 1356.
21
I. The contention that the Double Jeopardy Clause of the Fifth Amendment forbids the 1954 sentence may be shortly answered. It depends upon the assertion that the trial court determined in 1952 that petitioner 'should not be subject to imprisonment or probation' on his plea of guilty to embezzlement. Without such a determination, there could not be double jeopardy. The transcript of evidence, all pertinent parts of which are quoted in the first part of this opinion, shows no such determination. The petitioner cites no words upon which he relies. The only sentence that was entered at the 1952 hearing was the one of probation, admittedly invalid because of petitioner's absence.4
22
It is clear to us, too, that the District Court did not by implication intend to acquit or dismiss the defendant. Within the morning session of court, when his failure to make explicit the sentence was called to his attention, he judge directed entry of the order suspending sentence and instituting probation. There is no occasion here for distinguishing between an oral pronouncement of sentence and its entry on the records of the court. Cf. Spriggs v. United States, 9 Cir., 225 F.2d 865, 868. Nor does the situation call for a determination of the correctness of petitioner's assertion that a federal judge has power, under a statute without minimum penalties,5 to release or discharge an accused absolutely after conviction or plea of guilty without sentence, suspension of sentence or grant of probation.6 It is unfortunate for inadvertencies to lead to confusion in criminal trials, but such misunderstanding as petitioner may have drawn from the occurrences at the 1952 sentence is not a basis for vacating the later sentence. The mishap of the prisoner's absence when the first sentence was pronounced cannot be a basis for vacating the 1954 sentence here involved. If the probation sentence had been valid, petitioner on its violation would have been subject to the sentence actually imposed in 1954. 18 U.S.C. § 3653, 18 U.S.C.A. § 3563; Roberts v. United States, 320 U.S. 264, 268 64 S.Ct. 113, 115, 88 L.Ed. 41.
23
II. Petitioner's other contentions relate to violations of constitutional rights of speedy trial and due process, and significant departure from proper standards of criminal law administration. It is not disputed that a court has power to enter sentence at a succeeding term where a void sentence had been previously imposed. Miller v. Aderhold, 288 U.S. 206, 53 S.Ct. 325, 77 L.Ed. 702; cf. Bozza v. United States, 330 U.S. 160, 166, 67 S.Ct. 645, 648, 91 L.Ed. 818. To hold otherwise would allow the guilty to escape punishment through a legal accident.
24
Petitioner argues that the 1954 sentence violated his right under the Sixth Amendment of the Constitution to a 'speedy' trial.7 He takes this position on the assumption that the case remained, as we have held above, uncompleted after the 1952 trial. We will assume arguendo that sentence is part of the trial for purposes of the Sixth Amendment. The time for sentence is of course not at the will of the judge. Rule 32(a) of the Federal Rules of Criminal Procedure requires the imposition of sentence 'without unreasonable delay.'
25
Whether delay in completing a prosecution such as here occurred amounts to an unconstitutional deprivation of rights depends upon the circumstances. See, e.g., Beavers v. Haubert, 198 U.S. 77, 87, 25 S.Ct. 573, 576, 49 L.Ed. 950; Frankel v. Woodrough, 8 Cir., 7 F.2d 796, 798. The delay must not be purposeful or oppressive. It was not here. It was accidental and was promptly remedied when discovered. Nothing in the record indicates any delay in sentencing after discovery of the 1952 error. From the issuance of the warrant in September 1954 for the violation, of probation the normal inference would be that the error was still unknown to the court, although petitioner states he had known of it since November 1952.8 We do not have in this case circumstances akin to those in Petition of Provoo (United States v. Provoo), D.C., 17 F.R.D. 183, 201, affirmed mem. 350 U.S. 857, 76 S.Ct. 101, 100 L.Ed. 761, where Judge Thomsen found the delay 'caused by the deliberate act of the government' which the accused attempted to correct. The same situation existed in United States v. McWilliams, 82 U.S.App.D.C. 259, 163 F.2d 695, where the Government's failure to be ready for trial persisted for nearly two years despite defendant's motions for trial. In these circumstances, we do not view the lapse of time before correction of the error as a violation of the Sixth Amendment or of Rule 32(a). Error in the course of a prosecution resulting in conviction calls for the correction of the error, not the release of the accused. Dowd v. United States ex rel. Cook, 340 U.S. 206, 210, 71 S.Ct. 262, 264, 95 L.Ed. 215.
26
Petitioner contends also that, in sentencing him for the embezzlement in 1954, the judge disregarded the standards prescribed for such a proceeding. He points out that the transcript of evidence shows that the prosecuting attorney in open court, instead of the judge, inquired of petitioner as to waiver of his right to counsel. He suggests that this violates Rule 44 of the Federal Rules of Criminal Procedure.9 On the same transcript authority, he makes the suggestion that Rules 32(a) and 37(a)(2) were disregarded concerning opportunity 'to make a statement in his own behalf and to present any information in mitigation of punishment' and advice to a defendant 'not represented by counsel * * * of his right to appeal.' Petitioner argues that these irregularities constitute a denial of due process. While we do not impose on persons unlearned in the law the same high standards of the legal art that we might place on the members of the legal profession, we think that these issues are too far afield from the questions that petitioner raised in the courts below and in his petition for certiorari for them properly to be before us. In any case, the formal commitment papers signed by the judge show that these steps, except that of advising petitioner of his right to appeal, were actually taken. We are not willing to conclude from the transcript of evidence covering only such notes as were 'taken at the above time and place' that the above purely routine statutory requirements were not followed.
27
This leaves unresolved the question whether the Court of Appeals' denial of leave to appeal was proper. Since we conclude that petitioner must lose on the merits, nothing could be gained by a remand to the Court of Appeals even if we should be of the opinion that the Court of Appeals erred in denying leave to appeal.
28
Affirmed.
29
Mr. Chief Justice WARREN, with whom Mr. Justice BLACK, Mr. Justice DOUGLAS, and Mr. Justice BRENNAN join, dissenting.
30
Our duty to supervise the administration of justice in the federal courts calls for a reversal here because of disregard shown for the procedural rights of petitioner—rights with which the law surrounds every person charged with crime.
31
Our law, based upon centuries of tragic human experience, requires that before a man can be sent to a penitentiary, he is entitled to a speedy trial, to be present in court at every step of the proceedings, at all times to be represented by counsel, or to speak in his own behalf, and to be informed in open court of every action taken against him until he is lawfully sentenced. These are not mere ceremonials to be neglected at will in the interests of a crowded calendar or other expediencies. They are basic rights. They bulk large in the totality of procedural rights guaranteed to a person accused of crime. Here, in the case of an impecunious defendant, who was summarily rushed through the court mill without benefit of counsel, all of them, in some degree, were denied him.
32
The petitioner was not a dangerous criminal. His trouble, as the court recognized, was intemperance. During the course of a long drinking spree, he became involved with both the state and federal authorities. As soon as he became sober enough to realize the consequences of his actions, he made a full disclosure to one of the officers of Alcoholics Anonymous and to the Federal Bureau of Investigation.
33
He was sentenced to a state penitentiary. He was also charged by the Federal Government with unlawfully opening a letter and extracting a check which he cashed. The case was not pressed until petitioner was about to be discharged from the state penitentiary.1 Without counsel, he pleaded guilty. He was then brought into court to receive sentence. The colloquy between him and the court concluded as follows:
34
'The Court: You ought to know the misery and the grief and the sorrow and the horror of what continued drinking on your part will bring to you.
35
'If I might suggest to you, and I am giving you gratuitous advice but it is the result of observation and experience—it is my view that when you get out you should immediately join the Alcoholics Anonymous organization—not wait a week or two weeks or three weeks—but have that your first mission after you contact your family, and do what they tell you to do and do it immediately and do it diligently and faithfully, carry out every obligation that they impose upon you. With your background and with your ability I think that you can win this fight.
36
'If you don't do those things, and if you want to revert to drinking, you will be back here again because you will commit some federal offense, and I won't be talking to you this way if you are ever before me again.
37
'So, good luck to you and I hope the parole board will give you an opportunity.
38
'That is all.
39
'The Defendant: Thank you very much, sir.'
40
Petitioner's wife, a close personal friend and the two state custodial officers who were present at the hearing concluded, as would anyone, that the kindly and understanding language of the judge ended the matter and that additional punishment was not to be imposed. Petitioner was returned to the state penitentiary. Later in the day, after an inquiry by the prosecuting attorney as to the disposition of the case, the judge casually said, 'Three years (probation).'2 Petitioner was absent when this occurred.3 Notice of this action was not even communicated to him. A month or so later, as he was being released from the state prison, the officials advised him that he must report to the federal probation officer. Naturally, he complied. But he immediately tried to discover, through the probation officer, how and why he was subject to probation. The officer succeeded in convincing him that the 'sentence' was legal. Again, a year later, petitioner requested his probation officer to investigate. The officer discovered the truth of petitioner's assertions. Though he recognized the irregularity of the proceedings, he suggested to petitioner that it would not be wise to pursue the matter—that further complications might develop.
41
In September 1954, nearly two years after his first appearance before the court for sentencing, petitioner lapsed in the fight against excessive drinking. Reported as a probation violator, he was again brought into federal court. His case was disposed of in the most summary style. The Assistant United States Attorney first obtained the defendant's statement waiving right to counsel. He was not advised by the court, as required by law, of his right to counsel and to the appointment of counsel if desired. Fed.Rules Crim.Proc., 44. The judge, but not petitioner, had apparently been apprised beforehand of the illegality of the October 3, 1952, sentence.
42
'The Court: What I am going to do in your case, because of the record, is to sentence you in the first instance: It's the judgment of the Court that you be confined in an institution to be selected by the Attorney General of the United States for a period of two years. That's all.
43
'Mr. Evarts (Prosecuting Attorney): Now, Your Honor, as you recall, the record shows that he was, sentence was imposed on October 3, 1952, and I would suggest to the Court that an Order be made setting aside the judgment and commitment that was entered at that time so that the record will now truly reflect the status of the events.
44
'The Court: All right.'
45
In this Court the Government concedes the total invalidity of the 'sentence' of October 3, 1952, and contends that these events of September 21, 1954, are to be treated as the first and only sentence imposed on the defendant for the crime of which he had pleaded guilty in 1952. But it too has infirmities. It cannot be said that this long delayed sentencing hearing comports with the requirements of the Federal Rules of Criminal Procedure. As already stated, petitioner was not represented by counsel. There was no attempt to comply with Rule 37(a)(2), which provides that: 'When a court after trial imposes sentence upon a defendant not represented by counsel, the defendant shall be advised of his right to appeal * * *.' Furthermore, Rule 32(a) contains a mandatory requirement: 'Before imposing sentence the court shall afford the defendant an opportunity to make a statement in his own behalf and to present any information in mitigation of punishment.' No opportunity was afforded the defendant to say a word in mitigation or extenuation of his offense.4
46
Petitioner also question the power of the trial court to sentence him so long after arraignment. The Sixth Amendment guarantees to persons accused of crimes in a federal court that they shall receive a 'speedy and public trial.' It has never been held that the sentence is not part of the trial.' But it is not necessary to decide this issue on constitutional grounds. The principle has been implemented by the Federal Rules of Criminal Procedure.
47
Rule 32(a) declares unequivocally that: 'Sentence shall be imposed without unreasonable delay.' The majority holds that this two-year delay is not unreasonable because it was 'accidental' and was 'promptly remedied when discovered.' There is nothing in the record to warrant either of these conclusions. Both the court and the prosecuting attorney were put on notice of the fatal defect of the abortive sentence on the day it was imposed. No steps were taken to remedy the defect. Petitioner declared that he twice initiated investigation of the legality of his sentence. The probation officer obviously checked with someone long before petitioner was brought to court for what is now called his 'first' sentence. We cannot simply assume that the facts did not come to the attention of any responsible person.
48
This proceeding was initiated as a motion to vacate sentence under 28 U.S.C. § 2255, 28 U.S.C.A. § 2255. The district judge refused to accord petitioner a hearing and, considering only the motion and the files and records in the court, denied relief. Then, in spite of the infirmities in the case revealed by these documents, leave to appeal in forma pauperis was denied. The Court of Appeals for the Eighth Circuit affirmed this action, but we granted certiorari and appointed counsel to represent petitioner.
49
The conclusion that the condonation of this succession of procedural shortcomings represents a restriction of petitioner's rights is inescapable. This Court has often said that such departures from accepted standards should not be permitted—that to do so encourages looseness in many ways. Petitioner has served the two years of imprisonment while pursuing his remedy to this Court. We cannot unring' the bell that so casually sent him to prison, but w can and should make the record show that he was not committed to a federal prison in accordance with the accepted standard of criminal procedure.
1
Cf. Pino v. Landon, 349 U.S. 901, 75 S.Ct. 576, 99 L.Ed. 1239, reversing Pino v. Nicolls, 1 Cir., 215 F.2d 237.
2
Such an order is reviewable on certiorari. Wells v. United States, 318 U.S. 257, 63 S.Ct. 582, 87 L.Ed. 746.
3
No question is raised as to the length of the 1954 sentence. Cf. Roberts v. United States, 320 U.S. 264, 64 S.Ct. 113, 88 L.Ed. 41.
4
'In a criminal case final judgment means sentence; and a void order purporting permanently to suspend sentence is neither a final nor a valid judgment.' Miller v. Aderhold, 288 U.S. 206, 210 211, 53 S.Ct. 325, 326, 77 L.Ed. 702. Cf. Korematsu v. United States, 319 U.S. 432, 434, 63 S.Ct. 1124, 1125, 87 L.Ed. 1497; Hill v. United States ex rel. Wampler, 298 U.S. 460, 464, 56 S.Ct. 760, 762, 80 L.Ed. 1283; Berman v. United States, 302 U.S. 211, 212, 58 S.Ct. 164, 165, 82 L.Ed. 204.
5
The statute upon which the information was based reads: '* * * (an embezzler) shall be fined not more than $2,000 or imprisoned not more than five years, or both.' 18 U.S.C. § 1702, 18 U.S.C.A. § 1702.
6
See 18 U.S.C. § 3651, 18 U.S.C.A. § 3651; Fed.Rules Crim.Proc., 32(a, b, e).
7
Fed.Rules Crim.Proc., 48(b), provides for enforcement of this right: 'If there is unnecessary delay in presenting the charge to a grand jury or in filing an information against a defendant who has been held to answer to the district court, or if there is unnecessary delay in bringing a defendant to trial, the court may dismiss the indictment, information or complaint.'
8
We note that petitioner made no motion to secure a prompt proper sentence, often considered important in questions involving the Speedy Trial Clause. See cases cited in Petition of Provoo, D.C., 17 F.R.D. 183.
9
'If the defendant appears in court without counsel, the court shall advise him of his right to counsel and assign counsel to represent him at every stage of the proceeding unless he elects to proceed without counsel or is able to obtain counsel.'
1
The alleged offense occurred on or about May 21, 1951. A complaint was signed the following July. Nothing further ensued in the case until September 8, 1952. On that date the United States Attorney filed an information and petitioner entered his plea of guilty.
2
'The Court: Is there anything else, Mr. Hachey (Prosecuting Attorney)?
'Mr. Hachey: Going back to the matter of Thomas E. Pollard who appeared this morning—I didn't quite understand that clearly is there to be a probationary period after his release from Stillwater, or any type of sentencing?
'The Court: It is to commence at the expiration of sentencing at Stillwater.
'Mr. Hachey: Probation to commence after expiration of his sentencing at Stillwater—for how long?
'The Court: Three years.'
3
The Government concedes that the probation sentence was completely invalid because it was imposed in petitioner's absence. Fed.Rules Crim.Proc., 43.
4
The stereotyped recitals in the commitment papers, referred to by the majority, are wholly inconsistent with the verbatim transcript of the proceedings, which is clearly a complete record of all that actually occurred while petitioner was before the court.
| 01
|
352 U.S. 385
77 S.Ct. 431
1 L.Ed.2d 415
Allen I. NILVA, Petitioner,v.UNITED STATES of America.
No. 37.
Argued Nov. 8 and 13, 1956.
Decided Feb. 25, 1957.
Rehearing Denied April 8, 1957.
See 353 U.S. 931, 77 S.Ct. 716.
Mr. Eugene Gressman, Washington, D.C., for the petitioner.
Mr. Richard J. Blanchard, Washington, D.C., for the respondent.
Mr. Justice BURTON delivered the opinion of the Court.
1
In this case, a Federal District Court convicted an attorney of criminal contempt on three specifications for disobeying subpoenas duces tecum, and imposed a general sentence of imprisonment for a year and a day. Since the Government has abandoned two of the specifications, the principal questions are whether there is sufficient evidence to sustain the conviction on the third specification standing alone, and, if so, whether the case should be remanded for resentencing. For the reasons hereafter stated, we answer each in the affirmative.
2
In 1953, in the District Court of the United States for the District of North Dakota, petitioner, Allen I. Nilva, was tried, with Elmo T. Christianson and Herman Paster, for conspiracy to violate the Federal Slot Machine Act, 64 Stat. 1134 1136, 15 U.S.C. §§ 1171—1177, 15 U.S.C.A. §§ 1171—1177. Christianson was the Attorney General of North Dakota. Paster was the owner of several distributing companies located in St. Paul, Minnesota. Petitioner was an attorney in St. Paul, a brother-in-law of Paster, and an officer in several of Paster's distributing companies. The indictment charged that these three conspired, with others, to accumulate slot machines late in 1950 and transport them into North Dakota, where they were to be distributed and operated under the protection of Christianson, who was to take office as Attorney General of that State on January 2, 1951.
3
On the first trial, in 1953, a jury was unable to agree on the guilt of Christianson and Paster but acquitted petitioner. In 1954, in preparation for a retrial of Christianson and Paster, the same court issued subpoenas duces tecum No. 78, returnable on March 22, and No. 160, returnable on March 29. Each was addressed to the Mayflower Distributing Company, a St. Paul slot machine distributing corporation wholly owned by Paster. Each called for the production of records, for certain periods in 1950 and 1951, relating to transactions in slot machines and other coinoperated devices.1 Each was served on Walter D. Johnson, secretary-treasurer of the company.
4
On the date set for trial, Paster, instead of producing the subpoenaed records, moved to quash the subpoenas on the ground that the company was wholly owned by him and that the subpoenas required him to furnish evidence against himself. The motion was denied and, in response to the Government's request, the court ordered the subpoenaed records to be produced 'forthwith.'2 Three days later, on April 1, petitioner, who was an attorney of record for Paster, appeared in court and stated that he was the company's vice-president appearing for it in answer to the subpoenas. He said that 'in response to this subpoena I personally, with the aid of people in the office force, searched all of our records in an attempt to comply with your subpoena and have brought all of the evidence I could to comply therewith.' However, when the Government asked for the records of purchases and sales of slot machines called for by the subpoenas, he stated that he had been unable to locate them and suggested that some of the company's records had been transferred to St. Louis in connection with a conspiracy case pending there on appeal.3
5
The trial court, being convinced, as it later stated, that petitioner was giving false and evasive testimony, issued an order reciting the failure of the officers of the company to produce the subpoenaed records and ordering all records of the company impounded by the United States Marshal. Many of the company's records in St. Paul were at once impounded and accountants from the Federal Bureau of Investigation promptly examined them. Among them were records of the company's purchases and sales of slot machines in 1950 and 1951. At the conspiracy trial on April 12, an F.B.I. agent named Peterson testified about those records from summaries he had compiled.
6
On April 15, the trial court found it apparent that petitioner's testimony 'was evasive or false, or both,' and ordered him not to leave its jurisdiction without permission. No further action was taken at that time 'because it was the Court's desire that the jury (in the conspiracy case) should not learn of the affair during the trial, so that the defendants therein would not be prejudiced by it in any way.'
7
On April 22, the jury found Christianson and Paster guilty of the conspiracy charged.4 On the following day, the court directed petitioner to appear on April 27 and show cause why he should not be held in criminal contempt for having obstructed the administration of justice.5 In three specifications, the court charged petitioner with—
8
'1. Giving false and evasive testimony under oath on April 1, 1954, upon answering, as vice-president of the Mayflower Distributing Company, subpoenaes duces tecum directed to (it) * * * '2. Disobedience to subpoena duces tecum No. 78, directed to the Mayflower Distributing Company * * * in that the following articles were not produced, as required thereby:
9
'(a) Original ledger sheet reflecting the account of Stanley Baeder, November 1, 1950 through August 30, 1951;
10
'3. Disobedience to subpoena duces tecum No. 160 directed to the Mayflower Distributing Company, and disobedience to the order of the Court, made on March 29, 1954, directing the Mayflower Distributing Company to produce records forthwith, in the case of United States of America v. Elmo T. Christianson and Herman Paster, Criminal No. 8158, in that the following articles were not produced, as required thereby:
11
'(a) General ledger 1950;
12
'(b) General ledger 1951;
13
'(c) Journal 1950—1951;
14
'(d) Check Register 1950—1951; * * *.' At 10 a.m., on April 27, petitioner appeared as directed. The court gave his counsel access to the impounded records and postponed the hearing until 3 p.m. At that time, the impounded books and records were present on the trial table and petitioner took the stand in his own defense. He identified items (a), (b), (c) and (d) of the 22 listed in the third specification and introduced those records as his exhibits. Item (a) was the company's general ledger for 1950. It contained a record of sales of new slot machines during October 1950—January 1951; sales of used slot machines during July 1950—January 1951; and purchases of used slot machines during August 1950—January 1951. Petitioner admitted having previously examined the company's 1950 and 1951 general ledgers but said that he had not found evidence of slot machine purchases and sales. He also admitted that he had not examined 19 of the 22 items listed in specification No. 3. At the close of the hearing, over petitioner's objection, a transcript of the testimony of F.B.I. Agent Peterson, given at the conspiracy trial, was admitted in evidence in the contempt proceeding without opportunity for petitioner to confront him or cross-examine him in that proceeding.
15
After finding petitioner guilty of criminal contempt on each of the three specifications, the court gave him a general sentence of imprisonment for a year and a day. On June 3, it released him on bail but denied his motion to suspend his sentence and grant him probation.
16
The Court of Appeals affirmed the judgment, 227 F.2d 74, and denied rehearing, 228 F.2d 134. We granted certiorari. 350 U.S. 1005, 76 S.Ct. 650, 100 L.Ed. 867.
17
Although the District Court found petitioner guilty of contempt on each of the three specifications, the Government now concedes that the convictions on the first two are of doubtful validity and does not undertake to sustain them. Consequently, we do not consider them here.6
18
This reduces the case to the charge that petitioner wilfully disobeyed the court's order to produce certain corporate records required by subpoena No. 160. On that issue, it is settled that a criminal contempt is committed by one who, in response to a subpoena calling for corporation or association records, refuses to surrender them when they are in existence and within his control. United States v. Fleischman, 339 U.S. 349, 70 S.Ct. 739, 94 L.Ed. 906; United States v. White, 322 U.S. 694, 64 S.Ct. 1248, 88 L.Ed. 1542; Wilson v. United States, 221 U.S. 361, 31 S.Ct. 538, 55 L.Ed. 771; and see United States v. Patterson, 2 Cir., 219 F.2d 659.
19
The Government rests its case on petitioner's failure to produce the records listed in the first four items set forth in specification No. 3, i.g., the general ledger for 1950, the general ledger for 1951, the journal for 1950—1951, and the check register for 1950—1951. These are impounded records which petitioner introduced in evidence as his exhibits.7 The first is the general ledger for 1950, shown by the list of petitioner's exhibits to include records of purchases and sales made during part of the period called for by subpoena No. 160.8 Petitioner admits having previously examined the first two items.
20
Petitioner was a 'nominal' vice-president of the corporation; he rendered it legal and administrative services of many kinds; he was a brother-in-law of its sole owner and president; he appeared in court as its official representative in answer to the subpoenas and represented that he had brought with him all of the subpoenaed records that he and the office force could find.
21
The subpoenas had been served on the secretary-treasurer of the corporation, who, in turn, had entrusted to petitioner the duty of satisfying them. When petitioner appeared in court in response to the subpoenas, he did not claim either want of actual possession of the required records or lack of opportunity or authority to produce them. See United States v. Bryan, 339 U.S. 323, 333, 70 S.Ct. 724, 731, 94 L.Ed. 884; Wilson v. United States, supra, 221 U.S. at page 376, 31 S.Ct. at page 542. Yet he failed to produce the vital corporate records which the Government promptly impounded. In our opinion, the evidence reasonably supports the conclusion that those records were in existence and were within petitioner's control.
22
Petitioner contends that his testimony that he attempted, in good faith, to comply with the subpoenas disproves the existence of any wilful default, and presents an 'adequate excuse' for his failure to comply under Rule 17(g), Federal Rules of Criminal Procedure. However, his protestations of good faith were subject to appraisal by the court that heard them. It was the judge of his credibility and of the weight to be given to his testimony. Lopiparo v. United States, 8 Cir., 216 F.2d 87, 91. In our view, the trial court had a sufficient basis for concluding that petitioner intentionally, and without 'adequate excuse,' defied the court.9 We, therefore, agree that the record sustains petitioner's conviction for criminal contempt under specification No. 3.
23
Petitioner claims that he was not allowed adequate time to prepare his defense. Under the circumstances of this case and in view of the wide discretion on such matters properly vested in the trial court, we think this claim is unfounded.10
24
Petitioner also contends that, as a matter of law, this contempt proceeding should have been heard by a judge other than the one who initiated the proceeding. Rule 42(b), Federal Rules of Criminal Procedure, does not require disqualification of the trial judge except where 'the contempt charged involves disrespect to or criticism of a judge * * *.'11 Concededly, the contempt here charged was not of that kind. And while there may be other cases, brought under Rule 42(b), in which it is the better practice to assign a judge who did not preside over the case in which the alleged contumacy occurred to hear the contempt proceeding, such an assignment is discretionary. In the absence of a showing of an abuse of that discretion, petitioner's conviction on specification No. 3 should be sustained.
25
There remains a question as to petitioner's general sentence. It was imposed following his conviction on each of the three original specifications. Although the Government now undertakes to sustain but one of the convictions, it contends that petitioner's sentence should be left as it is because it was within the trial court's allowable discretion. We believe, however, that the court should be given an opportunity to reconsider petitioner's sentence in view of the fact that his conviction now rests solely on the third specification.12
26
Accordingly, petitioner's conviction for criminal contempt on specification No. 3 is affirmed but his sentence is vacated and the case is remanded to the District Court for reconsideration of his sentence.
27
It is so ordered.
28
Conviction affirmed, but sentence vacated, and case remanded for reconsideration of sentence.
29
Mr. Justice BLACK, with whom The CHIEF JUSTICE, Mr. Justice DOUGLAS and Mr. Justice BRENNAN, join, dissenting.
30
This conviction for criminal contempt should be reversed and the case should be remanded to the District Court with directions that it be tried before some district judge other than the one who preferred the charges against the petitioner and then convicted him. There have probably been few cases in the annals of this Court where the proceedings below were afflicted with so many flagrant errors. The Government has confessed most of these errors, but contends that enough can be salvaged from the record to sustain the conviction.
31
Petitioner, who is a lawyer, was a vice president of the Mayflower Distributing Company. Apparently he served largely as a nominal officer and performed only minor functions for this company. He was indicted with the president of the company and another man on a charge that they had conspired unlawfully to transport gambling devices in interstate commerce. A jury acquitted petitioner but failed to reach a verdict on the charge against the other two defendants. Subsequently a new trial was ordered for these two defendants. Prior to this new trial, the Government procured the issuance of two very broad subpoenas that directed the Mayflower Distributing Company to produce a large number of its corporate records, which the Government anticipated might show illegal transactions in interstate commerce. These subpoenas were served on the company's secretary but since he was occupied elsewhere he asked the petitioner to produce the material demanded by the subpoenas. On rather short notice petitioner produced a substantial number of records in compliance with these orders.
32
However, the Government, believing that all of the company's records called for by the subpoenas had not been produced, examined petitioner under oath before the trial judge in an effort to determine the extent of his compliance. Petitioner testified that he had produced as many of the records demanded as he could locate by a diligent search; nevertheless the trial judge ordered that all of the company's records be impounded. Government agents took charge of these impounded records and examined them. The Government claims that this material included books and documents called for by the subpoenas but not produced by the petitioner.
33
The trial judge issued an order under Rule 42(b) of the Federal Rules of Criminal Procedure for petitioner to show cause why he should not be held in criminal contempt of the court. This charge of contempt was based on three specifications: (1) that petitioner had testified falsely and evasively when asked under oath whether he had produced all the materials called for by the subpoenas; (2) that he had failed to comply with the first subpoena by not producing five items; and (3) that he had disobeyed the second subpoena by failing to produce twenty-two items. Four days after this order was issued, a hearing on the contempt charge was held before the same trial judge who sat in the retrial of the two other defendants and who preferred the charge against the petitioner. The judge found petitioner guilty on all three specifications of contempt and sentenced him to one year and one day imprisonment. The Court of Appeals affirmed the judgment.1
34
The Government confesses that the conviction on the first two specifications of contempt cannot be sustained. As it concedes, there was not only insufficient evidence to support the charges made in these specifications but the trial court admitted and relied on evidence which was clearly incompetent. In addition, petitioner was denied his constitutional right to confront and cross-examine witnesses whose testimony was used against him. And in regard to the first specification alleging false and evasive testimony under oath, petitioner's conduct, at most, only involved perjury, a crime that cannot be punished by use of the contempt power.2 Nevertheless, the Government would have us uphold the conviction and sentence below on the basis of the finding of guilt on the third specification alone, the alleged failure to comply with the second subpoena.
35
A fundamental premise of our criminal law is that the prosecution has the burden of proving beyond a reasonable doubt that the accused committed the offense charged. And this Court has repeatedly emphasized that a prosecution for criminal contempt should be treated the same as any other criminal prosecution in this respect.3 Before petitioner could be found guilty of criminal contempt for failing to comply with a subpoena, the prosecution had the burden of showing beyond a reasonable doubt that he intentionally refused to obey the court's order by not producing the materials demanded even though they were available to him. In this case the record does not contain enough competent evidence for the trier of fact to find that petitioner intentionally refused to comply with the second subpoena or even that the books and documents demanded by that subpoena were available to him.
36
Only four of the twenty-two documents referred to in the third specification were introduced in evidence and, as the Government recognizes, the conviction must rest on petitioner's intentional refusal to produce these four documents. The only competent evidence in the record which even tends to support an inference that petitioner knew the location of any of these four documents or that they were accessible to him was his comment that he had 'previously' examined two of them.4 But by itself this solitary ambiguous fragment is clearly insufficient to justify finding beyond a reasonable doubt that the records were available to petitioner at the time when he was supposed to comply with the second subpoena. Since the prosecution offered no admissible evidence at the trial, this obscure remark constitutes the sole case on this point against petitioner. It is the only shred of admissible evidence that the majority has been able to glean from the record. On the other hand, petitioner testified that as far as he knew most of the company's records were stored in the basement of its office and that he had made a diligent search through these records in an effort to produce the material demanded by the subpoena. And he was not the custodian of the company's records, but only a nominal officer.
37
Similarly there was almost nothing before the trial court which even suggested that petitioner intentionally refused to produce the records demanded. He stated under oath that he was not trained in accounting and was not familiar with the company's accounting records. He repeatedly testified that he had attempted in good faith to comply with the subpoena. The Government contends that a prima facie case of intentional refusal can be made out circumstantially from such evidence as is contained in the record. But since the competent evidence does not even support an inference that petitioner knew the location of the four crucial documents or that they were accessible to him, it is hard to see how an intentional refusal to obey can be implied at all, let alone beyond a reasonable doubt.
38
The trial judge compounded his error in convicting petitioner on such a striking insufficiency of competent evidence by relying on inadmissible hearsay statements which were not subject to cross-examintion. The Government introduced in evidence, over objection, a transcript of an FBI agent's testimony at a prior trial in which petitioner was not a party. The agent had testified that he found certain records and documents in the company's offices. Appently some of these were papers that the second subpoena had ordered the May-flower Company to produce. The FBI agent's testimony together with certain statements by petitioner did furnish some evidence that these papers were available to petitioner, but, as the Government confesses, this testimony was plainly inadmissible.5 Nevertheless the record indicates that the trial judge relied on it in finding petitioner guilty. As a matter of fact he went so far as to say '* * * that in this proceeding there ought to be include any pertinent part of the record or the files in the preceding case because this contempt proceeding arose out of the (petitioner's) actions (in refusing to comply with a subpoena issued in the prior case).'
39
The judge's position was manifestly wrong. A trial for criminal contempt is a proceeding wholly separate from any prior trial out of which the alleged contempt arose.6 A conviction for contempt in a Rule 42(b) proceeding must stand on the evidence properly introduced in that proceeding. Where a trial judge bases his decision in part on evidence which although material is inadmissible the conviction cannot stand even though an appellate court might conclude after expunging the bas evidence that enough good remained to support the conviction. The defendant is entitled to a decision by the trial judge based on that judge's evaluation of the proper evidence. It is no answer to say that the trial judge could have found the defendant guilty solely on the good evidence. He did not and the defendant is entitled to a retrial. The danger of prejudice from inadmissible hearsay was particularly grave in this case since the admissible evidence before the trial court was so grossly inadequate.7
40
The erroneous admission of portions of the record from the earlier trial accentuated another impropriety in the proceedings below. I believe that it is wrong in a Rule 42(b) proceeding for the same judge who issued the orders allegedly disobeyed and who preferred the charges of contempt on his own initiative and based on his own knowledge to sit in judgment on the accused. In essence, this allows a man who already believes that another person has disobeyed his command to act as both prosecutor and judge in a proceeding to 'decide' formally whether that person disobeyed him and should be punished. It is contrary to elemental principles of justice to place such power in the hands of any man.8 At the very least another judge should be called upon to try the contempt charges. Here, besides issuing the orders allegedly disobeyed and then citing petitioner for contempt, the trial judge was intimately involved in earlier proceedings from which the contempt charge developed and in which evidence relevant to that charge was presented. Under such circumstances he would have been superhuman not to have held preconceived views as to petitioner's guilt.
41
The record discloses several incidents which specifically indicate that petitioner was not accorded a fair trial. At the outset, the judge informed the petitioner that the burden was on him to proceed. This is completely inconsistent with the presumption of innocence which exists in favor of a person charged with criminal contempt. Rather, the prosecutor carries the burden of establishing beyond a reasonable doubt that the alleged contemnor committed the offense charged.9 The almost total absence of any attempt by the Government to introduce evidence at petitioner's trial in support of the accusations of contempt indicates that it relied on the trial judge's personal knowledge of the case. And as the majority points out several times the trial judge repeatedly indicated prior to the trial that he believed that petitioner was guilty of false and evasive testimony—the offense charged in the first specification of contempt. There is nothing which suggests that he did not have similar preconceived views on the other two specifications.10 Surely every defendant is entitled to an impartial trial by one who has not prejudged his case but instead decides only on the evidence introduced at the trial. Application of this simple principle is just as necessary in contempt cases as in others.
42
Under Rule 42(b) of the Federal Rules of Criminal Procedure when the alleged contempt involves 'disrespect to or criticism of a judge' that judge shall be disqualified. Rule 42(b) contains no provision with respect to disqualification in other circumstances. The majority relies on this silence to reject petitioner's contention that the trial judge here should have stepped aside. But at most Rule 42(b) only permits a negative inference that a judge who prefers contempt charges for violations of his orders and who is intimately involved in related proceedings bearing on these charges can sit in judgment on the alleged contempt. In any event, Rule 42(b) is a rule promulgated by this Court and where it is not explicit we should not interpret it in a manner to deny a fair trial before an impartial arbiter. Even if the majority were correct in saying that an 'abuse of discretion' must be shown before this Court will compel a judge to disqualify himself, the record in this case clearly shows that it was an 'abuse of discretion' for the trial judge not to step aside.
43
If the preceding errors and improprieties are not flagrant enough, the Court of Appeals contributed additional error by relying on a so-called 'supplemental record' to affirm the conviction. This 'supplemental record' included material which was not introduced at the trial and which was not even made a part of the record on appeal by the trial judge. The Government now concedes that it was improper for the appellate court to rely on this material. But as its first opinion shows, the Court of Appeals referred to the 'supplemental record' to support its conclusion that there was sufficient evidence for the trial judge to find that the papers called for were available to petitioner, that he failed to produce them and that this failure was in bad faith. And on rehearing the Court of Appeals added still further error. After conceding that there were grave doubts about the admissibility of the FBI agent's uncross-examined hearsay statements, it nevertheless stated that the conviction was not reversible because the contempt could have been prosecuted under the summary procedures of Rule 42(a). But as the Government points out, petitioner could not conceivably have been convicted under that rule.
44
And there are even more matters tainting the proceedings below. For example, petitioner was rushed to trial with an unduly short period to prepare his defense to the contempt charge. He was informed of the specifications of contempt on a Friday and told to appear the next Tuesday for trial. Since the subpoenas were extremely broad and vague and the specifications involved a large number of documents petitioner faced a formidable task in preparing a defense. He had four days, over a weekend, to secure a lawyer and familiarize him with the case, to examine a great volume of records, to talk with those having relevant knowledge about these records and to secure witnesses. And when at the trial his lawyer requested a reasonable continuance, the judge gave only a few hours respite.
45
This Court should not sanction a conviction where the whole proceedings below were riddled with so many basic errors of serious magnitude. Sending the case back for a new sentence, even if it turns out to be a smaller one, seems to me to fall far short of according this peitioner the kind of justice every defendant has a right to expect from our courts. While somehow there is an idea that procedural safeguards required in other criminal trials are not available in trials for criminal contempt, due process certainly requires that one charged with such contempt be given a fair trial before an impartial judge. Here petitioner is to be deprived of his liberty and perhaps his professional career without having received that essential prerequisite to justice.
1
Subpoena No. 160 commanded the corporation to—
'Come and bring with you all invoices, bills, checks, slips, papers, records, letters, ledger sheets, bookkeeping records, journals and copies thereof between, by or concerning Mayflower Distributing Company, made, entered, sent or received from July 1, 1950, through April 30, 1951, both dates inclusive, reflecting any and all purchases, sales, trades, exchanges or transfers, both domestic and foreign of any and all slot machines, flat-top or console, coin operated device, whether new or used with any persons, firm or concern.'
2
This was pursuant to Rule 17(c), Federal Rules of Criminal Procedure, 18 U.S.C.A.:
'Rule 17. Subpoena.
'(c) For Production of Documentary Evidence and of Objects. A subpoena may also command the person to whom it is directed to produce the books, papers, documents or other objects designated therein. The court on motion made promptly may quash or modify the subpoena if compliance would be unreasonable or oppressive. The court may direct that books, papers, documents or objects designated in the subpoena be produced before the court at a time prior to the trial or prior to the time when they are to be offered in evidence and may upon their production permit the books, papers, documents or objects or portions thereof to be inspected by the parties and their attorneys.'
3
See Nilva v. United States, 8 Cir., 212 F.2d 115, decided April 19, 1954. This related to Samuel George Nilva, not the petitioner herein.
4
See Christianson v. United States, 8 Cir., 226 F.2d 646.
5
'Rule 42. Criminal Contempt.
'(b) Disposition Upon Notice and Hearing. A criminal contempt except as provided in subdivision (a) of this rule shall be prosecuted on notice. The notice shall state the time and place of hearing, allowing a reasonable time for the preparation of the defense, and shall state the essential facts constituting the criminal contempt charged and describe it as such. The notice shall be given orally by the judge in open court in the presence of the defendant or, on application of the United States attorney or of an attorney appointed by the court for that purpose, by an order to show cause or an order of arrest. The defendant is entitled to a trial by jury in any case in which an act of Congress so provides. He is entitled to admission to bail as provided in these rules. If the contempt charged involves disrespect to or criticism of a judge, that judge is disqualified from presiding at the trial or hearing except with the defendant's consent. Upon a verdict or finding of guilt the court shall enter an order fixing the punishment.' Fed.Rules Crim.Proc.
Authority to prosecute for criminal contempt is found in Rule 17(g), Federal Rules of Criminal Procedure, and 18 U.S.C. § 401(3), 18 U.S.C.A. § 401(3).
6
The Government concedes also that the transcript of Agent Peterson's testimony at the conspiracy trial should not have been admitted in evidence in the contempt proceeding and does not rely on it here. This concession does not materially affect the Government's case under specification No. 3, because the books and records named in that specification were properly introduced by petitioner as exhibits in the contempt proceeding and speak for themselves.
7
The parties stipulated that these exhibits would be a part of the record on appeal. Their contents are summarized in a list of exhibits which is included in a supplemental record, first introduced before the Court of Appeals. Although petitioner moved to strike out most of that supplemental record, he omitted from his motion all references to the pages containing this list and he has not objected to its presence in the record before us.
8
Among the records called for by subpoena No. 160 are 'ledger sheets' reflecting purchases and sales of slot machines between July 1, 1950, and April 30, 1951. See note 1, supra. The list of exhibits shows that exhibit No. 1 includes Mayflower's general ledger for 1950 in which the—
Records indicate that 'Sales—Bells New' (Slot Machine) (were) made as follows:
October 1950................ $650.00
December 1950.............. 3,631.00
January 1951............... 9,000.00
total $13,501.00
Sales—Bells used (slot machines)
July 1950................ $1,249.00
August 1950............... 3,160.00
September 1950............ 2,125.00
October 1950............ (1,140.00)
November 1950............... 625.00
December 1950............ 14,104.00
January 1951............. 50,005.00
total $72,499.50
The records further indicate that the following purchases were made:
'Purchases—Bells New' (slot machines)
. . . . .
"Purchases—Bells used" (slot machines)
. . . . .
August 1950................. $320.00
" 1950....................... 400.00
" 1950....................... 980.00
September 1950............... 990.00
" 1950....................... 315.00
" 1950...................... (80.00)
November 1950................ 100.00
December 1950............. 10,620.00
January 1951................ 965.00)
" 1951.................... 3,815.00). $11,960.00
" 1951.................... 7,180.00)
total $25,784.00
Exhibit No. 2 is described as a ledger containing, among other records, the Mayflower—St. Paul general journal March 31, 1951, to January 31, 1952, and general ledger February 1, 1951, to January 31, 1952.
Exhibit No. 3 is described as the Mayflower—St. Paul journal February 1, 1946, to January 31, 1953.
Exhibit No. 4 is described as the check register for Mayflower—St. Paul July 1, 1946, to January 31, 1955. Its contents are described as relating to purchases of used slot machines.
9
Whether proof of a lesser species of intent will satisfy the requirements for a conviction of criminal contempt need not be decided here. See, generally, Moskovitz, Contempt of Injunctions, Civil and Criminal, 43 Col.L.Rev. 780, 793—796 (1943); Note, The Intent Element in Contempt of Injunctions, Decrees and Court Orders, 48 Mich.L.Rev. 860, 864—869 (1950).
10
Petitioner was an attorney familiar with the case. He appeared in answer to the subpoenas on April 1; after the impounded records were produced, he was, on April 15, warned not to leave the jurisdiction of the court; the order for him to show cause why he should not be held in criminal contempt was issued on April 23, returnable on April 27; and on April 27 his hearing was postponed five hours to give his counsel extra time to examine the impounded records.
11
See note 5, supra.
12
Cf. Minoru Yasui v. United States, 320 U.S. 115, 117, 63 S.Ct. 1392, 1393, 87 L.Ed. 1793; Husty v. United States, 282 U.S. 694, 703, 51 S.Ct. 240, 242, 75 L.Ed. 629.
1
227 F.2d 74.
2
In re Michael, 326 U.S 224, 66 S.Ct. 78, 90 L.Ed. 30.
3
E.g., Michaelson v. United States ex rel. Chicago, St. P., M. & O.R. Co., 266 U.S. 42, 66, 45 S.Ct. 18, 20, 69 L.Ed. 162 ('In criminal contempts, as in criminal cases, the presumption of innocence obtains. Proof of guilt must be beyond reasonable doubt * * *.'); Gompers v. Buck's Stove & Range Co., 221 U.S. 418, 444, 31 S.Ct. 492, 499, 55 L.Ed. 797 ('Without deciding what may be the rule in civil contempt, it is certain that in proceedings for criminal contempt the defendant is presumed to be innocent, he must be proved to be guilty beyond a reasonable doubt * * *.').
See also United States ex rel. Porter v. Kroger Grocery & Baking Co., 7 Cir., 163 F.2d 168, 172. ('(W)e have examined the authorities with a view of ascertaining the essential elements necessary to be alleged and proven in order to justify a conviction for criminal contempt. It is plain that a defendant is entitled to all the protection afforded a defendant in an ordinary criminal case and that the burden is upon the government to establish his guilt beyond a reasonable doubt.')
4
The transcript of the record gives the following colloquy:
'Q. (By petitioner's counsel) Have you examined Respondent's Exhibit 3? (Exhibit 3 was one of the four documents introduced in evidence.)
'A. (By petitioner) Yes, sir, I have examined this record, as well as the others, and from my examination—no, let me say, I examined those other two records previously and was unable to find any evidence of slot machines—'
Petitioner's answer is ambiguous. It does not indicate where or when the prior examination took place or under what conditions.
5
See In re Oliver, 333 U.S. 257, 273, 68 S.Ct. 499, 507, 92 L.Ed. 682.
6
Gompers v. Buck's Stove & Range Co., 221 U.S. 418, 444 446, 451, 31 S.Ct. 492, 499—500, 55 L.Ed. 797; Hayes v. Fischer, 102 U.S. 121, 26 L.Ed. 95; City of New Orleans v. The Steamship Co., 20 Wall. 387, 22 L.Ed. 354; Ex parte Kearney, 7 Wheat. 38, 5 L.Ed. 391.
7
In its footnote 6 the majority states that the four documents introduced in evidence speak for themselves. It is not clear what the majority means by this statement. The mere fact that they were before the trial court does not tend to show that their location was known to petitioner or that they were available to him. At most it only shows that they were in existence at the trial and permits an inference that they existed somewhere previously.
8
In In re Murchison, 349 U.S. 133, 75 S.Ct. 623, 99 L.Ed. 942, this Court held that it violated due process for a judge to try contempt charges which he had preferred while acting as a so-called one-man grand jury. The Court, 349 U.S. at pages 136 137, 75 S.Ct. at page 625, declared:
'A fair trial in a fair tribunal is a basic requirement of due process. Fairness of course requires an absence of actual bias in the trial of cases. But our system of law has always endeavored to prevent even the probability of unfairness. To this end no man can be a judge in his own case and no man is permitted to try cases where he has an interest in the outcome. * * * Fair trials are too important a part of our free society to let prosecuting judges be trial judges of the charges they prefer.'
In the present case we are not compelled to reach the question of due process since this Court possesses general supervisory power over the criminal procedures in lower federal courts.
9
See footnote 3, supra.
10
A further indication of the trial judge's attitude toward petitioner is found in the 'supplemental record' prepared by the Government for the Court of Appeals. The judge is reported as stating at the conclusion of the contempt trial that had petitioner 'been a defendant in the (trial of his two alleged coconspirators) as it was tried (the second time), I don't think he would have been so fortunate.' The judge then imposed a harsh sentence on petitioner.
| 01
|
352 U.S. 512
77 S.Ct. 451
1 L.Ed.2d 503
John W. WEBB, Petitioner,v.ILLINOIS CENTRAL RAILROAD CO.
No. 42.
Argued Dec. 3, 1956.
Decided Feb. 25, 1957.
Mr. Robert J. Rafferty, Chicago, Ill., for the petitioner.
Mr. Herbert J. Deany, Chicago, Ill., for the respondent.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
This is an action under the Federal Employers' Liability Act,1 in which certiorari was granted to consider whether the Court of Appeals for the Seventh Circuit erred in reversing a judgment for damages awarded to the petitioner in the District Court for the Northern District of Illinois.2 The ground for the reversal was that the evidence was insufficient to allow a jury determination of the respondent's alleged negligence, so that respondent's motion for a directed verdict should have been granted.3
2
The petitioner, working as a brakeman on July 12, 1952, injured his kneecap in a fall on a cinder roadbed at a point some 15 feet from a house track switch at Mount Olive, Illinois. He was alongside a track connecting to the switch and slipped on an unnoticed and partially covered cinder 'about the size of (his) fist' embedded in the level but soft roadbed.
3
It is conceded that the clinker in the roadbed created a hazardous condition giving rise to respondent's liability under the Act if the proofs raised a jury question of respondent's alleged negligence in causing or permitting the clinker to be there. The Court of Appeals viewed the evidence as insufficient to raise a jury question because the petitioner did not adduce proofs showing what standard procedures were followed to prevent large clinkers from being used in road ballast and in inspecting roadbeds for hazards to firm footing. We do not think that the petitioner's evidence was lacking in such proofs even if we assume, and we question, that he had that burden. On the contrary, we think there were probative facts in the evidence to justify with reason a jury finding of the negligence alleged.
4
'(I)n passing upon whether there is sufficient evidence to submit an issue to the jury we need look only to the evidence and reasonable inferences which tend to support the case of a litigant against whom a peremptory instruction has been given.'4 We think the jury could have found from the proofs that, 3 weeks before the mishap, respondent elevated the house switch and the connecting tracks some 5 inches, using 15 cubic yards of cinder and chat ballast. Petitioner testified without objection, based on his knowledge and experience gleaned from 27 years of railroading, that the railroad's custom and practice was to take precautions to prevent the presence of large clinkers in a railroad bed, both because 'it doesn't give good footing; and it cannot be tamped in under the ties for support.' Moreover, the respondent's evidence supplied additional facts. The section foreman in charge of the repair work testified that he did not screen the ballast for large clinkers but merely visually inspected the ballast as it was shoveled by four laborers onto 'the pushcart' before being taken to the site. His testimony was that the largest cinder he saw would be 'say two inches in diameter. * * * Of course, I have no way of knowing exactly, but about.' In this posture of the proofs, there is ample evidence for a jury to determine whether the procedure followed satisfied the standard to be expected from a prudent man in light of the hazard to be prevented.
5
We also think that a jury question was presented by the evidence bearing on the adequacy of respondent's roadbed inspection practices used to discover hazards to firm footing. As the jury might find that the clinker was in the ballast used in the repair work, so also the jury might find, from the fact that it was in the roadbed for three weeks, that inspection was not properly made. There was evidence from which it could have been found that the clinker was not discovered either by the foreman in semiweekly inspections of the location, made in part to discover and remove hazards to workmen, or by a track inspector and a track supervisor making less frequent inspections. It was for the jury to weigh the evidence and to decide whether or not the inspections satisfied respondent's duty to provide the petitioner with a safe place to work.
6
The Court of Appeals said: 'That defendant placed the clinker in its roadbed as a part of the ballast used in the repair operation is merely one of several possibilities present. A finding that it did so can rest on nothing but speculation.'5 In this connection the Court of Appeals mentioned two other possible sources of the clinker. One was the L. & N. Railroad, whose main line and house tracks immediately adjoined and were connected to the respondent's house switch by a cross-over track. Another was that some stranger may have brought the clinker onto respondent's unfenced right-of-way. That there were other possible sources of the clinker would not, of course, justify a directed verdict in light of our conclusion that the evidence supports with reason a jury finding that the respondent negligently caused the clinker to be in the ballast used in the repair work and failed to use proper care to discover and remove it.6 Indeed, we do not think that the evidence would reasonably support a finding that the clinker came from another source.
7
Although we do not think that the case presents an issue of causation, if the quoted language of the Court of Appeals is read as holding that a jury finding could not reasonably be made that respondent's negligence 'in whole or in part' caused the petitioner's injury, then what we said in Rogers v. Missouri Pacific R. Co., 352 U.S. 500, 77 S.Ct. 443, 448, also decided today, is pertinent:
8
'* * * But that would mean that there is no jury question in actions under this statute, although the employee's proofs support with reason a verdict in his favor, unless the judge can say that the jury may exclude the idea that his injury was due to causes with which the defendant was not connected, or, stated another way, unless his proofs are so strong that the jury, on grounds of probability, may exclude a conclusion favorable to the defendant. That is not the governing principle defining the proof which requires a submission to the jury in these cases. * * *
9
'Under this statute the test of a jury case is simply whether the proofs justify with reason the conclusion that employer negligence played any part, even the slightest, in producing the injury of death for which damages are sought. It does not matter that, from the evidence, the jury may also with reason, on grounds of probability, attribute the result to other causes, including the employee's contributory negligence. Judicial appraisal of the proofs to determine whether a jury question is presented is narrowly limited to the single inquiry whether, with reason, the conclusion may be drawn that negligence of the employer played any part at all in the injury or death. Judges are to fix their sights primarily to make that appraisal and, if that test is met, are bound to find that a case for the jury is made out whether or not the evidence allows the jury a choice of other probabilities.' We have considered the remaining questions, not passed upon by the Court of Appeals, and find them to be unsubstantial. Accordingly, we remand the case for proceedings in conformity with this opinion.
10
The judgment is reversed.
11
Reversed.
12
Mr. Justice BURTON concurs in the result.
13
Mr. Justice REED would affirm the judgment of the Court of Appeals.
14
For dissenting opinions of Mr Justice FRANKFURTER, and Mr. Justice HARLAN, see 352 U.S. 518, 77 S.Ct. 459.
1
35 Stat. 65, as amended, 36 Stat. 291, 53 Stat. 1404, 45 U.S.C. § 51 et seq., 45 U.S.C.A. § 51 et seq.
2
351 U.S. 905, 76 S.Ct. 697, 100 L.Ed. 1441.
3
228 F.2d 257.
4
Wilkerson v. McCarthy, 336 U.S. 53, 57, 69 S.Ct. 413, 415, 93 L.Ed. 497.
5
228 F.2d at page 259.
6
Some speculation may have entered into the jury's decision. However, this Court has stated: 'It is no answer to say that the jury's verdict involved speculation and conjecture. Whenever facts are in dispute or the evidence is such that fair-minded men may draw different inferences, a measure of speculation and conjecture is required on the part of those whose duty it is to settle the dispute by choosing what seems to them to be the most reasonable inference.' Lavender v. Kurn, 327 U.S. 645, 653, 66 S.Ct. 740, 744, 90 L.Ed. 916.
| 78
|
352 U.S. 419
77 S.Ct. 502
1 L.Ed.2d 438
FEDERAL TRADE COMMISSION, Petitioner,v.NATIONAL LEAD COMPANY et al.
No. 63.
Argued Dec. 12, 1956.
Decided Feb. 25, 1957.
Mr. Earl W. Kintner, Washington, D.C., for the petitioner.
Mr. Eugene Z. Du Bose, New York City, for the respondent.
Mr. Justice CLARK delivered the opinion of the Court.
1
The sole question involved in this proceeding under § 5 of the Federal Trade Commission Act1 concerns the power of the Commission in framing an order pursuant to its finding that respondents had conspired to adopt and use a zone delivered pricing system in their sale of lead pigments.2 In its general cease and desist order prohibiting concert of action among respondents in the further use of such system, the Commission inserted a provision directing each respondent individually to cease and desist from adopting the same or a similar system of pricing for the purpose or with the effect of 'matching' the prices of competitors. The respondents assert that this is beyond the power of the Commission, and the Court of Appeals agreed, 7 Cir., 227 F.2d 825, striking that provision from the Commission's order. We granted certiorari, 351 U.S. 961, 76 S.Ct. 1026, 100 L.Ed. 1482, because of the importance of the question in the administration of the Act. We restore the stricken provision of the Commission order, permitting it to stand with the interpretations placed upon it in this opinion.
I.
2
The original proceeding under § 5 of the Act was commenced in 1944. The order was entered on a second amended complaint filed in 1946. After protracted hearings, the Commission entered its findings which the Court of Appeals has held to be supported by substantial evidence. The findings material here are as follows:
3
The pricing practice of the industry as to the sale of white lead in oil prior to 1933 is not shown in the record. However, National Lead had as early as 1910 sold this pigment on the basis of territorial differentials involving free freight to specified towns. The differentials added to the base price were generally uniform for some 589 cities listed in National Lead's pricing system in 1933. The charge to purchasers outside the listed cities was the base price plus actual freight to the nearest listed city. In the sales of dry white lead and lead oxides it appears that by the sales practice prior to 1933 there was a uniform delivered price in the case of the white lead, while the purchasers of lead oxides paid the freight charge in addition to the base price.
4
Beginning in July 1933, the industry held a series of meetings in Chicago for the ostensible purpose of drafting a code of fair competition to govern it under the National Industrial Recovery Act, 48 Stat. 195. These meetings resulted in an understanding and agreement among those attending, including respondents, to sell lead pigments 'on the basis of flat delivered prices to customers within designated zones, with uniform differentials applicable as between such zones . . ..' 49 F.T.C. 840. Four zoning systems were established covering the various lead pigments. As an example, the system for white lead in oil and 'keg' products consisted of 12 geographical zones, one known as a par zone. The remaining zones in this system were known as premium zones, the price in each being determined by adding a set premium to the par zone price. These premiums varied from $.125 per cwt. in two of the zones to a high of $1 per cwt. in the premium zone covering the State of New Mexico.3 The zones were highly artificial and zone boundaries led to bizarre results at times, with purchasers located near the plants of respondents being charged higher prices than those located at a distance from the plants. The industry, including respondents, not only agreed to sell at the same zone delivered prices in identical geographical zones but also adopted uniform discounts, terms of sale, and differentials with respect to certain of their products. A further agreement was to sell white lead in oil on the basis of consignment contracts.
5
The Commission stated that 'nowhere in the code, nor in any preliminary draft of a code produced at the meetings of any of the committees, is there any reference to the use of zones or to territorial differences in the prices of lead pigments, or to the use of agency or consignment contracts or arrangements in the sale of white lead-in-oil.' Id., at 839. The Commission added that 'with certain exceptions, the respondents have followed the pricing practices and have adhered to the terms and conditions for the sale of lead pigments agreed upon in 1933 and 1934 as herein found from 1934 to the present time.' Id., at 849. The respondents admit that they are bound by these findings and we see no reason to disturb them.
II.
6
The Commission entered an order prohibiting respondents from entering into or carrying out any 'planned common course of action,' agreement, or conspiracy to sell at prices determined pursuant to a 'zone delivered price system,' or any other system resulting in identical prices at the points of sale. The order also included a provision, to which respondents strenuously object, directing each of them to cease and desist from
7
'quoting or selling lead pigments at prices calculated or determined in whole or in part pursuant to or in accordance with a zone delivered price system for the purpose or with the effect of systematically matching the delivered price quotations or the delivered prices of other sellers of lead pigments and thereby preventing purchasers from finding any advantage in price in dealing with one or more sellers as against another.' Id., at 873—874.
8
The Commission, in an accompanying opinion, stated that in all cases where it found violations of the law, 'it is the Commission's duty to determine to the best of its ability the remedy necessary to suppress such activity and to take every precaution to preclude its revival.' Id., at 884. In this case, the opinion pointed out, the respondents cooperatively revised the pricing practices in the industry by establishing a 'uniform zone pricing system.' Detailed discussions were carried on which resulted not only in an agreement, but 'maps showing the boundaries of the zones to be observed * * * were distributed' by the individual respondents. Id., at 884, Each respondent has 'since that time * * * followed the pricing system and adhered to the zone boundaries so discussed and shown on these maps.' Ibid. Discussing the complaint, the Commission in its opinion further noted that charges were included against each respondent as to its individual use of and adherence to the zone system of selling 'for the purpose and with the effect of enabling the respondents to match exactly their offers to sell lead pigments to any prospective purchaser at any destination, thereby eliminating competition between and among themselves.' * * * It was the adherence by each of them to this system of pricing that made the combination work. * * * Unless and until each of the respondents is prohibited from so adhering to the system and from so using the zones, the evils springing from the combination, one of which is to eliminate price competition, may well continue indefinitely. Unless the respondents, representing practically the entire economic power in the industry, are deprived of the device which made their combination effective, an order merely prohibiting the combination may well be a useless gesture.' Id., at 884—885. In its view, the Commission added, the 'prohibition is necessary, not because it is unlawful in all circumstances for an individual seller, acting independently, to sell its products on a delivered price basis in specified territories, but to make the order fully effective against the trade restraining conspiracy in which each of the respondents (defendants) participated.' Id., at 884. When and if competition is restored and the individual prohibition is no longer necessary, the Commission expressed its intention, upon application, to vacate the latter provision of its order.
III.
9
At the beginning we must understand the limits of the contested portion of the order. First, it is temporary. Though its life expectancy is not definite, it is clear that the Commission was creating a breathing spell during which independent pricing might be established without the hang-over of the long-existing pattern of collusion. Second, the order is directed solely at the use of a zone delivered pricing system4 and no other. This system is a pricing method based on geographic devisions or zones, the boundaries of which are entirely drawn by the seller. His delivered price is the same throughout a particular geographic zone so drawn up by him. Customarily the delivered price is different between zones, though as here, widely separated zones, geographically, might have the same delivered price. It is well to mention here that while this Court has passed upon the validity of basing point systems of sales, Corn Products Refining Co. v. Federal Trade Commission, 1945, 324 U.S. 726, 65 S.Ct. 961, 89 L.Ed. 1320, it has not decided the validity of the zone pricing plan used here. Third, zone delivered pricing per se is not banned by the order. The Commission might have made the order more specific by entering a flat prohibition of the use for a definite period of the device found to be 'the very cornerstone of the * * * conspiracy,' i.e., zone pricing. See Hartford-Empire Co. v. United States, 1945, 323 U.S. 386, 428, 65 S.Ct. 373, 394, 89 L.Ed. 322, where the corporate defendants were enjoined from 'forming or joining any such trade association' for a period of five years. But the Commission chose the more flexible sanction, i.e., the limited use of zone delivered pricing. However, it concluded that the future use should be temporarily restricted for the protection of the public. And so, delivered zone pricing violates the order only when two conditions are present: (1) identical prices with competitors, (2) resulting from zone delivered pricing. Considering these conditions with the mechanics of the zone plan, we see that the only way prices can be systematically identical is for the zones of competitors to be so drawn as to be in whole or in part identical and for zone prices to be the same in those zones which coincide or overlap.5
10
Respondents contend that the cease and desist order, as written, excludes the benefits of § 2(b) of the Clayton Act.6 While § 2(b) 'does not concern itself with pricing systems * * * (but) only (with) the seller's 'lower' price and (with) that only to the extent that it is made 'in good faith to meet an equally low price of a competitor," Federal Trade Commission v. A. E. Staley Mfg. Co., 1945, 324 U.S. 746, 753, 65 S.Ct. 971, 975, 89 L.Ed. 1338, this section is read into every Commission order. Federal Trade Commission v. Ruberoid Co., 1952, 343 U.S. 470, 476, 72 S.Ct. 800, 804, 96 L.Ed. 1081. Since § 2(b) must, therefore, be read into this order, the respondents are afforded all of the benefits of that section.
IV.
11
It is the contention of respondents that the contested paragraph of the order effectively bans the noncollusive, individual use of zone pricing, a lawful, competitive sales method, and is therefore beyond the authority of the Commission. Respondents further assert that even if the Commission had such authority its exercise here was entirely improper, unnecessary, and would, in fact, hamper competition in the industry. They stress that the complaint did not include a charge that the individual use of zone pricing was unlawful; that it came into the case after the Trial Examiner had filed his recommended decision and order; and that respondents were denied the opportunity of rebutting the charge by evidence showing zone pricing to be 'a logical, economical, and competitive method of doing business.' The insertion of the objectionable paragraph, they contend, violates due process in that they had no opportunity to defend. Since § 2(b) is read into every Commission order and since it would allow respondents to rebut the charge, their contention is completely answered and we shall not deal with it further.
12
It goes without saying that the requirements of a fair hearing include notice of the claims of the opposing party and an opportunity to meet them. Morgan v. United States, 1938, 304 U.S. 1, 58 S.Ct. 773, 82 L.Ed. 1129. The record indicates that the respondents were afforded those safeguards. The emphasis that there was no charge, no evidence, no finding to support the inclusion of the objectionable provision in the order is misplaced. Its insertion was nothing more than a mode of implementation, selected by the Commission, to enforce its findings of violations of the Act. Moreover, the record is replete with evidence that counsel supporting the complaint would seek the use of such a method of enforcement. As far back as in early 1947, while the case was before the Examiner, the issue concerning the effect of the zone pricing system used by respondents was before the Commission on motions to dismiss. Admittedly Count II of the complaint dealt with the use of the zone system itself. The Commission overruled the motions to dismiss, adopting the view of counsel supporting the complaint that its allegations were directed against the effects of the alleged system or method, i.e., the zone pricing plan, and 'not against individual instances' of discrimination in pricing. Furthermore, in May 1948, almost five years before the decree was entered, counsel supporting the complaint filed written exceptions to the recommended decision of the Examiner on the ground, among others, that it did not include a provision similar to the one objected to here. If respondents thought rebuttal evidence necessary, the record is bare of any effort on their part to offer it. Nor was any request made to reopen the case for that purpose after it reached the Commission.
13
We pass on to respondents' major contention questioning the power of the Commission. As the Court has said many times before, the Commission may exercise only the powers granted it by the Act. Federal Trade Commission v. Western Meat Co., 1926, 272 U.S. 554, 559, 47 S.Ct. 175, 177, 71 L.Ed. 405. The relevant sections empower the Commission to prevent the use of unfair methods of competition and authorize it, after finding an unfair method present, to enter an order requiring the offender 'to cease and desist' from using such unfair method.
14
The Court has held that the Commission is clothed with wide discretion in determining the type of order that is necessary to bring an end to the unfair practices found to exist. In jacob Siegel Co. v. Federal Trade Commission, 1946, 327 U.S. 608, 66 S.Ct. 758, 90 L.Ed. 888, the Court named the Commission 'the expert body to determine what remedy is necessary to eliminate the unfair or deceptive trade practices which have been disclosed. It has wide latitude for judgment and the courts will not interfere except where the remedy selected has no reasonable relation to the unlawful practices found to exist.' Id., 327 U.S. at pages 612 613, 66 S.Ct. at page 760. Thereafter, in Federal Trade Commission v. Cement Institute, 1948, 333 U.S. 683, 726, 68 S.Ct. 793, 815, 92 L.Ed. 1010, the Court pointed out that the Congress, in passing the Act, 'felt that courts needed the assistance of men trained to combat monopolistic practices in the framing of judicial decrees in antitrust litigation.' In the light of this, the Court reasoned, it should not 'lightly modify' the orders of the Commission. Again, in Federal Trade Commission v. Ruberoid Co., supra, 343 U.S. at page 473, 72 S.Ct. at page 803, we said that 'if the Commission is to attain the objectives Congress envisioned, it cannot be required to confine its road block to the narrow lane the transgressor has traveled; it must be allowed effectively to close all roads to the prohibited goal, so that its order may not be bypassed with impunity.' We pointed out there that Congress had placed the primary responsibility for fashioning orders upon the Commission. These cases narrow the issue to the question: Does the remedy selected have a 'reasonable relation to the unlawful practices found to exist'? We believe that it does. First, the simplicity of operation of the plan lends itself to unlawful manipulation; second, it had been used in the industry for almost a quarter of a century; and, third, its originator and chief beneficiary had been previously adjudged a violator of the antitrust laws. United States v. National Lead Co., 1947, 332 U.S. 319, 67 S.Ct. 1634, 91 L.Ed. 2077.
15
The respondents were found to have plainly disregarded the law. In this respect the Commission correctly considered the circumstances under which the illegal acts occurred. Those in utter disregard of law, as here, 'call for repression by sterner measures than where the steps could reasonably have been thought permissible.' United States v. United States Gypsum Co., 1950, 340 U.S. 76, 89—90, 71 S.Ct. 160, 170, 95 L.Ed. 89. Respondents made no appeal here from some of the findings as to their guilt. Having lost the battle on the facts, they hope to win the war on the type of decree. They fight for the right to continue to use individually the very same weapon with which they carried on their unlawful enterprise. The Commission concluded that this must not be permitted. It was 'not obliged to assume, contrary to common experience, that a violator of the antitrust laws will relinquish the fruits of his violation more completely than (it) requires * * *.' International Salt Co. v. United States, 1947, 332 U.S. 392, 400, 68 S.Ct. 12, 17, 92 L.Ed. 20. Although the zone plan might be used for some lawful purposes, decrees often suppress a lawful device when it is used to carry out an unlawful purpose. Ethyl Gasoline Corp. v. United States, 1940, 309 U.S. 436, 60 S.Ct. 618, 84 L.Ed. 852; United States v. Bausch & Lomb Optical Co., 1944, 321 U.S. 707, 64 S.Ct. 805, 88 L.Ed. 1024. In such instances the Court is obliged not only to suppress the unlawful practice but to take such reasonable action as is calculated to preclude the revival of the illegal practices. Ethyl Gasoline Corp. v. United States, supra, 309 U.S. at page 461, 60 S.Ct. at page 627; Local 167 of I.B.T. etc. v. United States, 1934, 291 U.S. 293, 54 S.Ct. 396, 78 L.Ed. 804. See also United States v. United States Gypsum Co., supra; United States v. Crescent Amusement Co., 1944, 323 U.S. 173, 188, 65 S.Ct. 254, 261, 89 L.Ed. 160.7 We therefore conclude that, under the circumstances here, the Commission was justified in its determination that it was necessary to include some restraint in its order against the individual corporations in order to prevent a continuance of the unfair competitive practices found to exist. Federal Trade Commission v. Standard Education Society, 1937, 302 U.S. 112, 120, 58 S.Ct. 113, 117, 82 L.Ed. 141. We shall now examine the restraint imposed.
16
Respondents point out that in only one other case in the long history of the Commission has a similar order been entered. They say our restoration of the contested paragraph will effectively prevent competition. In its supplemental memorandum, see note 5, supra, the Commission has clearly stated its understanding of the scope and effect of the order. It is our conclusion that the order was not intended to and does not prohibit or interfere with independent delivered zone pricing per se. Nor does it prohibit the practice of the absorption of actual freight as such in order to foster competition. Furthermore, as we have said, there is read into the order the provision of § 2(b) of the Clayton Act as to the right of a seller in good faith to meet the lower price of a competitor. This is not to say that a seller may plead this section in defense of the use of an entire pricing system. The section is designed to protect competitors in individual transactions.
17
Respondents pose hypothetical situations which they say may rise up to plague them. However, 'we think it would not be good judicial administration,' as our late Brother Jackson said in International Salt Co. v. United States, 1947, 332 U.S. 392, 401, 68 S.Ct. 12, 17, 92 L.Ed. 20, to strike the contested paragraph of the order to meet such conjectures. The Commission has reserved jurisdiction to meet just such contingencies. As actual situations arise they can be presented to the Commission in evidentiary form rather than as fantasies. And we might add, if there is a burden that cannot be made lighter after application to the Commission, then respondents must remember that those caught violating the Act must expect some fencing in. United States v. Crescent Amusement Co., supra, 323 U.S. at page 187, 65 S.Ct. at page 261.
18
Reversed.
1
38 Stat. 719, as amended, 15 U.S.C. § 45, 15 U.S.C.A. § 45.
2
The three principal lead pigments are dry white lead, white lead in oil, and the lead oxides, red lead and litharge. Dry white lead is a fine white powder used as a pigment in paints. White lead in oil is white lead with linseed oil added and is sold for use as the basic ingredient in exterior house paint. Lead oxides and litharge are sold to electric storage battery manufacturers as the basic raw material for battery plates. Red lead is also the basic ingredient in red lead paint commonly used as a protective coating for iron and steel structures.
3
The par zone includes a number of northeastern and midwestern States. However, some cities located within these States are excluded from the par zone. On the other hand, the San Francisco area is a par zone, as is the City of St. Louis, though both are located in States not included in par zone areas. For a detailed discussion and maps of the operation of the zone pricing system, see the findings, 49 F.T.C. 840—870.
4
Our discussion of the zone delivered pricing system should in no way be construed as our approval of its use. We do not reach that question.
5
At oral argument, counsel for the Federal Trade Commission was requested by the Court to submit a statement on behalf of the Commission setting forth its view as to the scope of the disputed paragraph of the cease and desist order. In response, the Commission supplied its interpretation which coincides with that set out here.
6
49 Stat. 1526, 15 U.S.C. § 13(b), 15 U.S.C.A. § 13(b).
7
We need not discuss the full scope of the powers of the Federal Trade Commission, nor their relative breadth in comparison with those of a court of equity. As this Court said in May Department Stores Co. v. National Labor Relations Board, 1945, 326 U.S. 376, 390, 66 S.Ct. 203, 211, 90 L.Ed. 145, 'The test * * * is whether the Board might have reasonably concluded * * * that such an order was necessary * * *.'
| 78
|
352 U.S. 565
77 S.Ct. 550
1 L.Ed.2d 593
George JOHNSON, Petitioner,v.UNITED STATES of America.
No. Misc. 531.
Decided March 4, 1957.
PER CURIAM.
1
The petition for writ of certiorari is granted, as is leave to proceed in forma pauperis. By the Act of June 25, 1910, 36 Stat. 866, as now enlarged in 28 U.S.C. § 1915, 28 U.S.C.A. § 1915, Congress provided for proceedingsin forma pauperis on appeal unless 'the trial court certifies in writing that it (the appeal) is not taken in good faith.' Such certification is not final in the sense that the convicted defendant is barred from showing that it was unwarranted and that an appeal should be allowed. Of course, certification by the judge presiding at the trial carries great weight but, necessarily, if cannot be conclusive. Upon a proper showing a Court of Appeals has a duty to displace a District Court's certification. Moreover, a Court of Appeals must, under Johnson v. Zerbst, 304 U.S. 458, 58 S.Ct. 1019, 82 L.Ed. 1461, afford one who challenges that certification the aid of counsel unless he insists on being his own. Finally, either the defendant or his assigned counsel must be enabled to show that the grounds for seeking an appeal from the judgment of conviction are not frivolous and do not justify the finding that the appeal is not sought in good faith. This does not require that in every such case the United States must furnish the defendant with a stenographic transcript of the trial. It is essential, however, that he be assured some appropriate means—such as the district judge's notes or an agreed statement by trial counsel—of making manifest the basis of his claim that the District Court committed error in certifying that the desired appeal was not pursued in good faith. See Miller v. United States, 317 U.S. 192, 198, 63 S.Ct. 187, 190, 87 L.Ed. 179.
2
Since here the Court of Appeals did not assign counsel to assist petitioner in prosecuting his application for leave to appeal in forma pauperis and since it does not appear that the Court of Appeals assured petitioner adequate means of presenting it with a fair basis for determining whether the District Court's certification was warranted, the judgment below must be vacated and the case remanded to the Court of Appeals for proceedings not inconsistent with this opinion.
3
Judgment vacated and case remanded.
4
So ordered.
| 12
|
352 U.S. 599
77 S.Ct. 545
1 L.Ed.2d 583
Luis Alvara CEBALLOS (y Arboleda), Petitioner,v.Edward J. SHAUGHNESSY, District Director of the Immigration and Naturalization Service at the Port of New York.
No. 71.
Argued Jan. 16 and 17, 1957.
Decided March 11, 1957.
Mr. Sidney Kansas, New York City, for the petitioner.
Mr. Oscar H. Davis, Washington, D.C., for the respondent.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
This declaratory judgment action was brought by petitioner, in March 1955 in the District Court for the Southern District of New York, to obtain a judgment against the District Director of Immigration declaring that petitioner was eligible for suspension of deportation and restraining the Director from taking him into custody for deportation.1 The District Court dismissed the complaint, without reaching the merits, upon the procedural ground 'that the Attorney General (of the United States) and/or the Commissioner (of Immigration) are indispensable parties to the instant action.'2 The Court of Appeals for the Second Circuit affirmed, not only for the reason given by the District Court, but also upon the ground that, because the petitioner is 'an alien who 'has made application' to be relieved from military service,' he is debarred from citizenship as a matter of law and 'hence is not eligible for an order suspending deportation.'3 This Court granted certiorari.4
2
Deportation proceedings had been instituted because petitioner had entered the United States on April 2, 1951, on a temporary visa and remained beyond the period for which he was admitted. Petitioner was found deportable but was given permission to depart voluntarily, in lieu of deportation. Petitioner's timely application for suspension of deportation under § 19(c) of the Immigration Act of 1917, as amended,5 was denied by the Immigration and Naturalization Service because it found that petitioner did not satisfy a prerequisite for the application of that section—eligibility for naturalization. His ineligibility was based on a finding that in August 1943 petitioner, as a citizen and subject of Colombia, then a World War II neutral, applied under § 3(a) of the Selective Training and Service Act of 1940, as amended, for relief from service with the United States armed forces. Section 3(a) provided that 'any person who makes such application shall thereafter be debarred from becoming a citizen of the United States.'6
3
The petitioner was admitted to the United States for permanent residence in February 1942, during World War II. On June 16, 1943, he executed Selective Service System Form DSS 304, 'Alien's Personal History and Statement,' which gave the alien a choice of inserting 'do' or 'do not' in the statement: 'I * * * object to service in the land or naval forces of the United States.' The petitioner inserted the word 'do.' The form contained this notice:
4
'* * * If you are a citizen or subject of a neutral country, and you do not wish to serve in the land or naval forces of the United States, you may apply to your local board for Application by Alien for Relief from Military Service (Form 301) which, when executed by you and filed with the local board, will relieve you from the obligation to serve in the land or naval forces of the United States, but will also debar you from thereafter becoming a citizen of the United States.'7
5
On August 26, 1943, the petitioner executed Form DSS 301, 'Application by Alien for Relief from Military Service.' The form contained the following paragraph:
6
'I do hereby make application to be relieved from liability for training and service in the land or naval forces of the United States, under the Selective Training and Service Act of 1940, as amended, in accordance with the act of Congress, approved December 20, 1941. I understand that the making of this application to be relieved from such liability will debar me from becoming a citizen of the United States. * * *'8
7
Selective Service Regulations required the local board to follow prescribed formalities to place a neutral applying for relief from service in Class IV—C and to notify the alien of the classification.9 The board did not comply with these regulations in petitioner's case. Its first formal action was taken after the Selective Service System notified the board, on December 20, 1943, that Colombia, on November 26, 1943, had changed its neutral status to that of a cobelligerent with the United States. On January 27, 1944, five months after the petitioner filed the Form DSS 301, the board notified the petitioner that he was classified I—A, available for military service, and ordered him to report for preinduction physical examination. He reported as ordered, but failed to pass the physical examination and, on March 2, 1944, was reclassified IV—F, physically defective.
8
The petitioner argues that neither the Attorney General nor the Commissioner of Immigration is a necessary party to this action. The respondent offers no argument in opposition. We hold that neither the Attorney General nor the Commissioner is a necessary party. This Court in Shaughnessy v. Pedreiro, 349 U.S. 48, 75 S.Ct. 591, 99 L.Ed. 868, held that determination of the question of indispensability of parties is dependent, not on the nature of the decision attacked, but on the ability and authority of the defendant before the court to effectuate the relief which the alien seeks. In this case the petitioner asks to have the order of deportation suspended and to restrain the District Director from deporting him. Because the District Director is the official who would execute the deportation, he is a sufficient party. It is not a basis for distinction of Pedreiro that suspension of deportation, rather than deportation itself, is involved in this action.10
9
The petitioner's argument on the merits challenges the holding of the Court of Appeals that the execution and filing of Form DSS 301 had the effect as a matter of law of debarring him from becoming a citizen of the United States. He contends that debarment could result only if the local board affirmatively granted the relief applied for by classifying him IV—C on its records and giving him notice of its action. We hold that the petitioner's voluntary act of executing and filing, and allowing to remain on file, the legally sufficient application Form DSS 301 effected his debarment from citizenship under § 3(a).11 The explicit terms of the section debar the neutral alien 'who makes such application' for immunity from military service.
10
Legislative history shows this to be the effect contemplated by Congress.12 This same construction has been adopted in the few court decisions which refer to the section,13and administrative construction has consistently given the section this meaning.14 The neutral alien in this country during the war was at liberty to refuse to bear arms to help us win the struggle, but the price he paid for his unwillingness was permanent debarment from United States citizenship.
11
The petitioner argues that in any event § 315 of the Immigration and Nationality Act of 1952,15 and not s 3(a) of the Selective Training and Service Act of 1940, governs this case. Section 315 of the 1952 Act enacts a two-pronged requirement for the determination of permanent ineligibility for citizenship: the alien must be one 'who applies or has applied for exemption,' and also one who 'is or was relieved or discharged from such training or service on such ground.' That section has no application here. The 1952 law had not been enacted when the petitioner applied for relief from deportation in 195116 and by its terms is expressly made inapplicable to proceedings for suspension of deportation under § 19 of the Immigration Act of 1917 pending, as here, on the effective date of the 1952 law.17
12
Affirmed.
1
The action was instituted pursuant to § 10 of the Administrative Procedure Act, 60 Stat. 243, 5 U.S.C. § 1009, 5 U.S.C.A. § 1009, and the general jurisdictional provision of the Immigration and Nationality Act of 1952, 66 Stat. 230, 8 U.S.C. § 1329, 8 U.S.C.A. § 1329.
2
130 F.Supp. 30, 31.
3
229 F.2d 592, 593.
4
351 U.S. 981, 76 S.Ct. 1047, 100 L.Ed. 1495.
5
Section 19(c) of the Immigration Act of 1917, as amended, provided in pertinent part:
'In the case of any alien * * * who is deportable under any law of the United States and who has proved good moral character for the preceding five years, the Attorney General may (1) permit such alien to depart the United States to any country of his choice at his own expense, in lieu of deportation; or (2) suspend deportation of such alien if he is not ineligible for naturalization * * * if he finds (a) that such deportation would result in serious economic detriment to a citizen * * * who is the spouse * * * or minor child of such deportable alien * * *.' 39 Stat. 889, as amended, 54 Stat. 671, 62 Stat. 1206, 8 U.S.C. (1946 ed., Supp. V) § 155, now 8 U.S.C.A. § 1251.
6
Section 3(a) of the Selective Training and Service Act of 1940, as amended, provided in pertinent part:
'Except as otherwise provided in this Act, every male citizen of the United States, and every other male person residing in the United States, who is between the ages of eighteen and forty-five * * * shall be liable for training and service in the land or naval forces of the United States: Provided, That any citizen or subject of a neutral country shall be relieved from liability for training and service under this Act if, prior to his induction into the land or naval forces, he has made application to be relieved from such liability in the manner prescribed by and in accordance with rules and regulations prescribed by the President, but any person who makes such application shall thereafter be debarred from becoming a citizen of the United States * * *.' 54 Stat. 885, as amended, 55 Stat. 845, 56 Stat. 1019, 50 U.S.C.App. (1940 ed., Supp. II) § 303(a), now 50 U.S.C.A.Appendix, § 454(a).
7
This form was authorized by Selective Service System Order No. 75, 7 Fed.Reg. 3424.
8
This form was authorized by Selective Service System Order No. 54, 7 Fed.Reg. 1104.
9
32 CFR, 1943 Cum.Supp., § 622.43(b); 32 CFR, 1943 Cum.Supp., § 623.1; 32 CFR, 1943 Cum.Supp., § 623.61.
10
The Court of Appeals made that distinction and held that not Pedreiro but its decision in De Pinho Vaz v. Shaughnessy, 2 Cir., 208 F.2d 70, controlled. 229 F.2d at page 593.
11
The petitioner's claim that he executed the application in the belief that he was required to do so to obtain assignment to a Latin American contingent of the United States Army was rejected, after hearing, by the Immigration and Naturalization Service. In fact, the Board of Immigration Appeals found that petitioner 'fully understood the legal consequences of his action and that he was not duly influenced by other considerations.' Cf. Moser v. United States, 341 U.S. 41, 71 S.Ct. 553, 95 L.Ed. 729.
12
This appears in both the House and Senate Reports. The House Report states:
'* * * In the case of citizens or subjects of any neutral country, special provision is made to enable them, upon application, to be relieved from the liability for service, but the making of such application will debar them from becoming citizens of the United States. * * *' (Emphasis added.) H.R.Rep. No. 1508, 77th Cong., 1st Sess. 4.
The Senate Report states:
'* * * Under the bill reported by the committee, aliens would be liable whether or not they had declared their intention to become citizens. However, aliens who are citizens or subjects of a neutral country would be relieved of liability upon making application in the manner prescribed by the President, but the making of such application will debar them from ever becoming citizens of the United States. * * *' (Emphasis added.) S.Rep. No. 915, 77th Cong., 1st Sess. 2.
13
Mannerfrid v. United States, 2 Cir., 200 F.2d 730; Navarro v. Landon, D.C., 108 F.Supp. 922; see Machado v. McGrath, 90 U.S.App.D.C. 70, 74, 193 F.2d 706, 710. See McGrath v. Kristensen, 340 U.S. 162, 172, 71 S.Ct. 224, 230, 95 L.Ed. 173: 'By the terms of the statute, that bar only comes into existence when an alien resident liable for service asks to be relieved.' (Emphasis added.) See Moser v. United States, 341 U.S. 41, 45, 71 S.Ct. 553, 555, 95 L.Ed. 729: Section 3(a) 'imposed the condition that neutral aliens residing here who claimed such immunity would be debarred from citizenship.' (Emphasis added.)
14
See quotations from Forms DSS 304 and DSS 301 in text. And see, Selective Service Regulations, § 622.43, effective March 16, 1942, 7 Fed.Reg. 2087. Section 622.43, as revised, effective October 1, 1943, 8 Fed.Reg. 13672, read: '* * * (a) In Class IV—C shall be placed any registrant: * * * (2) Who is an alien and who is a citizen or subject of a neutral country * * * and who * * * files with his local board an Application by Alien for Relief from Military Service (Form 301) * * *.'
15
The Immigration and Nationality Act of 1952, § 315, provides:
'(a) Notwithstanding the provisions of section 405(b) of this Act, any alien who applies or has applied for exemption or discharge from training or service in the Armed Forces or in the National Security Training Corps of the United States on the ground that he is an alien, and is or was relieved or discharged from such training or service on such ground, shall be permanently inligible to become a citizen of the United States.
'(b) The records of the Selective Service System or of the National Military Establishment shall be conclusive as to whether an alien was relieved or discharged from such liability for training or service because he was an alien.' 66 Stat. 242, 8 U.S.C. § 1426, 8 U.S.C.A. § 1426.
16
The 1952 law became effective in December 1952.
17
The Immigration and Nationality Act of 1952, § 405(a), provides:
'Nothing contained in this Act, unless otherwise specifically provided therein, shall be construed * * * to affect * * * proceedings * * * brought, * * * or existing, at the time this Act, shall take effect; but as to all such * * * proceedings, * * * the statutes or parts of statutes repealed by this Act are, unless otherwise specifically provided therein, hereby continued in force and effect. * * * An application for suspension of deportation under section 19 of the Immigration Act of 1917, as amended * * * which is pending on the date of enactment of this Act, shall be regarded as a proceeding within the meaning of this subsection.' 66 Stat. 280, 8 U.S.C. § 1101, note 8 U.S.C.A. § 1101, note.
| 12
|
352 U.S. 567
77 S.Ct. 529
1 L.Ed.2d 563
UNITED STATES of America, Appellant,v.INTERNATIONAL UNION UNITED AUTOMOBILE, AIRCRAFT AND AGRICULTURAL IMPLEMENT WORKERS OF AMERICA (UAW-CIO).
No. 44.
Argued Dec. 3 and 4, 1956.
Decided March 11, 1957.
Solicitor General J. Lee Rankin, Washington, D.C., for the appellant.
Mr. Joseph L. Rauh, Jr., Washington, D.C., for the appellee.
Mr. Justice FRANKFURTER delivered the opinion of the Court.
1
The issues tendered in this case are the construction and, ultimately, the constitutionality of 18 U.S.C. § 610, 18 U.S.C.A. § 610, an Act of Congress that prohibits corporations and labor organizations from making 'a contribution or expenditure in connection with' any election for federal office. This is a direct appeal by the Government from a judgment of the District Court for the Eastern District of Michigan dismissing a four-count indictment that charged appellee, a labor organization, with having made expenditures in violation of that law. Appellee had moved to dismiss the indictment on the grounds (1) that it failed to state an offense under the statute and (2) that the provisions of the statute 'on their face and as construed and applied' are unconstitutional. The district judge held that the indictment did not allege a statutory offense and that he was therefore not required to rule upon the constitutional questions presented. D.C., 138 F.Supp. 53. The case came here, 351 U.S. 904, 76 S.Ct. 697, 100 L.Ed. 1440, under the Criminal Appeals Act of 1907, as amended, 18 U.S.C. § 3731, 18 U.S.C.A. § 3731.
2
It is desirable at the outset to quote the statute in its entirety:
3
'It is unlawful for any national bank, or any corporation organized by authority of any law of Congress, to make a contribution or expenditure in connection with any election to any political office, or in connection with any primary election or political convention or caucus held to select candidates for any political office, or for any corporation whatever, or any labor organization to make a contribution or expenditure in connection with any election at which Presidential and Vice Presidential electors or a Senator or Representative in, or a Delegate or Resident Commissioner to Congress are to be voted for, or in connection with any primary election or political convention or caucus held to select candidates for any of the foregoing offices, or for any candidate, political committee, or other person to accept or receive any contribution prohibited by this section.
4
'Every corporation or labor organization which makes any contribution or expenditure in violation of this section shall be fined not more than $5,000; and every officer or director of any corporation, or officer of any labor organization, who consents to any contribution or expenditure by the corporation or labor organization, as the case may be, and any person who accepts or receives any contribution, in violation of this section, shall be fined not more than $1,000 or imprisoned not more than one year, or both; and if the violation was willful, shall be fined not more than $10,000 or imprisoned not more than two years, or both.
5
'For the purposes of this section 'labor organization' means any organization of any kind, or any agency or employee representation committee or plan, in which employees participate and which exist for the purpose, in whole or in part, of dealing with employers concerning grievances, labor disputes, wages, rates of pay, hours of employment, or conditions of work.' 18 U.S.C. § 610, 18 U.S.C.A. § 610, taken from the Act of June 23, 1947, 61 Stat. 136, 159.
6
Appreciation of the circumstances that begot this statute is necessary for its understanding, and understanding of it is necessary for adjudication of the legal problems before us. Speaking broadly, what is involved here is the integrity of our electoral process, and, not less, the responsibility of the individual citizen for the successful functioning of that process. This case thus raises issues not less than basic to a democratic society.
7
The concentration of wealth consequent upon the industrial expansion in the post-Civil War era had profound implications for American life. The impact of the abuses resulting from this concentration gradually made itself felt by a rising tide of reform protest in the last decade of the nineteenth century. The Sherman Law, 15 U.S.C.A. §§ 1—7, 15 note was a response to the felt threat to economic freedom created by enormous industrial combines. The income tax law of 1894, 28 Stat. 509, reflected congressional concern over the growing disparity of income between the many and the few.
8
No less lively, although slower to evoke federal action, was popular feeling that aggregated capital unduly influenced politics, an influence not stopping short of corruption. The matter is not exaggerated by two leading historians:
9
'The nation was fabulously rich but its wealth was gravitating rapidly into the hands of a small portion of the population, and the power of wealth threatened to undermine the political integrity of the Republic.' 2 Morison and Commager, The Growth of the American Republic (4th ed. 1950), 355.
10
In the '90's many States passed laws requiring candidates for office and their political committees to make public the sources and amounts of contributions to their campaign funds and the recipients and amounts of their campaign expenditures. The theory behind these laws was that the spotlight of publicity would discourage corporations from making political contributions and would thereby end their control over party policies. But these state publicity laws either became dead letters or were found to be futile. As early as 1894, the soberminded Elihu Root saw the need for more effective legislation. He urged the Constitutional Convention of the State of New York to prohibit political contributions by corporations:
11
'The idea is to prevent * * * the great railroad companies, the great insurance companies, the great telephone companies, the great aggregations of wealth from using their corporate funds, directly or indirectly, to send members of the legislature to these halls in order to vote for their protection and the advancement of their interests as against those of the public. It strikes at a constantly growing evil which has done more to shake the confidence of the plain people of small means of this country in our political institutions than any other practice which has ever obtained since the foundation of our Government. And I believe that the time has come when something ought to be done to put a check to the giving of $50,000 or $100,000 by a great corporation toward political purposes upon the understanding that a debt is created from a political party to it.' Quoted in Hearings before House Committee on Elections, 59th Cong., 1st Sess. 12; see Root, Addresses on Government and Citizenship (Bacon and Scott ed. 1916), 143.
12
Concern over the size and source of campaign funds so actively entered the presidential campaign of 1904 that it crystallized popular sentiment for federal action to purge national politics of what was conceived to be the pernicious influence of 'big money' campaign contributions. A few days after the election of 1904, the defeated candidate for the presidency said:
13
'The greatest moral question which now confronts us is, Shall the trusts and corporations be prevented from contributing money to control or aid in controlling elections?' Quoted, Hearings, supra, at 56.
14
President Theodore Roosevelt quickly responded to this national mood. In his annual message to Congress on December 5, 1905, he recommended that:
15
'All contributions by corporations to any political committee or for any political purpose should be forbidden by law; directors should not be permitted to use stockholders' money for such purposes; and, moreover, a prohibition of this kind would be, as far as it went, an effective method of stopping the evils aimed at in corrupt practices acts.' 40 Cong.Rec. 96.
16
Grist was added to the reformers' mill by the investigation of the great life insurance companies conducted by the Joint Committee of the New York Legislature, the Armstrong Committee, under the guidance of Charles Evans Hughes. The Committee's report, filed early in 1906, revealed that one insurance company alone had contributed almost $50,000 to a national campaign committee in 1904 and had given substantial amounts in preceding presidential campaigns. The Committee concluded:
17
'Contributions by insurance corporations for political purposes should be strictly forbidden. Neither executive officers nor directors should be allowed to use the moneys paid for purposes of insurance in support of political candidates or platforms. * * * Whether made for the purpose of supporting political views or with the desire to obtain protection for the corporation, these contributions have been wholly unjustifiable. In the one case executive officers have sought to impose their political views upon a constituency of divergent convictions, and in the other they have been guilty of a serious offense against public morals. The frank admission that moneys have been obtained for use in State campaigns upon the expectation that candidates thus aided in their election would support the interests of the companies, has exposed both those who solicited the contributions and those who made them to severe and just condemnation.' Report of the Joint Committee of the Senate and Assembly of the State of New York Appointed to Investigate the Affairs of Life Insurance Companies, 397 (1906).
18
Less than a month later the Committee on Elections of the House of Representatives began considering a number of proposals designed to cleanse the political process. Some bills prohibited political contributions by certain classes of corporations; some merely required disclosure of contributions; and others made bribery at elections a federal crime. The feeling of articulate reform groups was reflected at a public hearing held by the Committee. Perry Belmont, leader of a nation-wide organization advocating a federal publicity bill, stated:
19
'* * * this thing has come to the breaking point. We have had enough of it. We don't want any more secret purchase of organizations, which nullifies platforms, nullifies political utterances and the pledges made by political leaders in and out of Congress.' Hearings before House Committee on Elections, 59th Cong., 1st Sess. 12.
20
This view found strong support in the testimony of Samuel Gompers, President of the American Federation of Labor, who said, with respect to the publicity bill:
21
'Whether this bill meets all of the needs may be questioned; that is open to discussion; but the necessity for some law upon the subject is patent to every man who hopes for the maintenance of the institutions under which we live. It is doubtful to my mind if the contributions and expenditures of vast sums of money in the nominations and elections for our public offices can continue to increase without endangering the endurance of our Republic in its purity and in its essence.
22
'* * * If the interests of any people are threatened by corruption in our public life or corruption in elections, surely it must of necessity be those, that large class of people, whom we for convenience term the wageworkers.
23
'I am not in a mood, and never am, to indulge in denunciations or criticism, but it does come to me sometimes that one of the reasons for the absence of legislation of a liberal or sympathetic or just character, so far as it affects the interest of the wage earners of America, can be fairly well traced with the growth of the corruption funds and the influences that are in operation during elections and campaigns * * *. I am under the impression that the patience of the American workingmen is about exhausted—
24
'* * * (If) we are really determined that our elections shall be free from the power of money and its lavish use and expenditure without an accounting to the conscience and the judgment of the people of America, we will have to pass some measure of this kind.' Id., at 28—31.
25
President Roosevelt's annual message of 1906 listed as the first item of congressional business a law prohibiting political contributions by corporations. 41 Cong.Rec. 22. Shortly thereafter, in 1907, Congress provided:
26
'That it shall be unlawful for any national bank, or any corporation organized by authority of any laws of Congress, to make a money contribution in connection with any election to any political office. It shall also be unlawful for any corporation whatever to make a money contribution in connection with any election at which Presidential and Vice-Presidential electors or a Representative in Congress is to be voted for or any election by any State legislature of a United States Senator.' 34 Stat. 864.
27
As the historical background of this statute indicates, its aim was not merely to prevent the subversion of the integrity of the electoral process. Its underlying philosophy was to sustain the active, alert responsibility of the individual citizen in a democracy for the wise conduct of government.
28
This Act of 1907 was merely the first concrete manifestation of a continuing congressional concern for elections 'free from the power of money.' (See statement of Samuel Gompers, supra.) The 1909 Congress witnessed unsuccessful attempts to amend the Act to proscribe the contribution of anything of value and to extend its application to the election of state legislatures. The Congress of 1910 translated popular demand for further curbs upon the political power of wealth into a publicity law that required committees operating to influence the results of congressional elections in two or more States to report all contributions and disbursements and to identify contributors and recipients of substantial sums. That law also required persons who spent more than $50 annually for the purpose of influencing congressional elections in more than one State to report those expenditures if they were not made through a political committee. 36 Stat. 822. At the next session that Act was extended to require all candidates for the Senate and the House of Representatives to make detailed reports with respect to both nominating and election campaigns. The amendment also placed maximum limits on the amounts that congressional candidates could spend in seeking nomination and election, and forbade them from promising employment for the purpose of obtaining support. 37 Stat. 25. And in 1918 Congress made it unlawful either to offer or to solicit anything of value to influence voting. 40 Stat. 1013.
29
This Court's decision in Newberry v. United States, 256 U.S. 232, 41 S.Ct. 469, 65 L.Ed. 913, invalidating federal regulation of Senate primary elections, led to the Federal Corrupt Practices Act of 1925, 43 Stat. 1070, 2 U.S.C.A. § 241 et seq., a comprehensive revision of existing legislation. The debates preceding that Act's passage reveal an attitude important to an understanding of the course of this legislation. Thus, Senator Robinson, one of the leaders of the Senate, said:
30
'We all know * * * that one of the great political evils of the time is the apparent hold on political parties which business interests and certain organizations seek and sometimes obtain by reason of liberal campaign contributions. Many believe that when an individual or association of individuals makes large contributions for the purpose of aiding candidates of political parties in winning the elections, they expect, and sometimes demand, and occasionally, at least, receive, consideration by the beneficiaries of their contributions which not infrequently is harmful to the general public interest. It is unquestionably an evil which ought to be dealt with, and dealt with intelligently and effectively.' 65 Cong.Rec. 9507—9508.
31
One of the means chosen by Congress to deal with this evil was § 313 of the 1925 Act, which strengthened the 1907 statute (1) by changing the phrase 'money contribution' to 'contribution' (§ 302(d) defined 'contribution' broadly); (2) by extending the prohibition on corporate contributions to the election to Congress of Delegates and Resident Commissioners; and (3) by penalizing the recipient of any forbidden contribution as well as the contributor.
32
When, in 1940, Congress moved to extend the Hatch Act, 53 Stat. 1147, which was designed to free the political process of the abuses deemed to accompany the operation of a vast civil administration, its reforming zeal also led Congress to place further restrictions upon the political potentialities of wealth. Section 20 of the law amending the Hatch Act made it unlawful for any 'political committee,' as defined in the Act of 1925, to receive contributions of more than $3,000,000 or to make expenditures of more than that amount in any calendar year. And § 13 made it unlawful 'for any person, directly or indirectly, to make contributions in an aggregate amount in excess of $5,000, during any calendar year, or in connection with any campaign for nomination or election, to or on behalf of any candidate for an elective Federal office' or any committee supporting such a candidate. The term 'person' was defined to include any committee, association, organization or other group of persons. 54 Stat. 767. In offering § 13 from the Senate floor Senator Bankhead said:
33
'We all know that money is the chief source of corruption. We all know that large contributions to political campaigns not only put the political party under obligation to the large contributors, who demand pay in the way of legislation, but we also know that large sums of money are used for the purpose of conducting expensive campaigns through the newspapers and over the radio; in the publication of all sorts of literature, true and untrue; and for the purpose of paying the expenses of campaigners sent out into the country to spread propaganda, both true and untrue.' 86 Cong.Rec. 2720.
34
The need for unprecedented economic mobilization propelled by World War II enormously stimulated the power of organized labor and soon aroused consciousness of its power outside its ranks. Wartime strikes gave rise to fears of the new concentration of power represented by the gains of trade unionism. And so the belief grew that, just as the great corporations had made huge political contributions to influence governmental action or inaction, whether consciously or unconsciously, the powerful unions were pursuing a similar course, and with the same untoward consequences for the democratic process. Thus, in 1943, when Congress passed the Smith-Connally Act to secure defense production against work stoppages, contained therein was a provision extending to labor organizations, for the duration of the war, § 313 of the Corrupt Practices Act. 57 Stat. 163, 167. The testimony of Congressman Landis, author of this measure, before a subcommittee of the House Committee on Labor makes plain the dominant concern that evoked it:
35
'The fact that a hearing has been granted is a high tribute to the ability of the Labor Committee to recognize the fact that public opinion toward the conduct of labor unions is rapidly undergoing a change. The public thinks, and has a right to think, that labor unions, as public institutions, should be granted the same rights and no greater rights than any other public group. My bill seeks to put labor unions on exactly the same basis, insofar as their financial activities are concerned, as corporations have been on for many years.
36
'* * * One of the matters upon which I sensed that the public was taking a stand opposite to that of labor leaders was the question of the handling of funds of labor organizations. The public was aroused by many rumors of huge war chests being maintained by labor unions, of enormous fees and dues being extorted from war workers, of political contributions to parties and candidates which later were held as clubs over the head of high Federal officials.
37
'* * * The source of much of the national trouble today in the coal strike situation is that ill-advised political contribution of another day (referring, apparently, to the reported contribution of over $400,000 by the United Mine Workers in the 1936 Campaign, see S.Rep.No. 151, 75th Cong., 1st Sess.). If the provision of my bill against such an activity has (sic) been in force when that contribution was made, the Nation, the administration, and the labor unions would be better off.' Hearings before a Subcommittee of the House Committee on Labor on H.R. 804 and H.R. 1483, 78th Cong., 1st Sess. 1, 2, 4.
38
Despite § 313's wartime application to labor organizations Congress was advised of enormous financial outlays said to have been made by some unions in connection with the national elections of 1944. The Senate's Special Committee on Campaign Expenditures investigated, inter alia, the role of the Political Action Committee of the Congress of Industrial Organizations. The Committee found 'no clear-cut violation of the Corrupt Practices Act on the part of the Political Action Committee' on the ground that it had made direct contributions only to candidates and political committees involved in state and local elections and federal primaries, to which the Act did not apply, and had limited its participation in federal elections to political 'expenditures,' as distinguished from 'contributions' to candidates or committees. S.Rep.No.101, 79th Cong., 1st Sess. 23. The Committee also investigated, on complaint of Senator Taft, the Ohio C.I.O. Council's distribution to the public at large of 200,000 copies of a pamphlet opposing the reelection of Senator Taft and supporting his rival. In response to the C.I.O.'s assertion that this was not a proscribed 'contribution' but merely an 'expenditure of its own funds to state its position to the world, exercising its right of free speech * * *.' the Committee requested the Department of Justice to bring a test case on these facts. Id., at 59. It also recommended extension of § 313 to cover primary campaigns and nominating conventions. Id., at 81. A minority of the Committee, Senators Ball and Ferguson, advocated further amendment of § 313 to proscribe 'expenditures' as well as 'contributions' in order to avoid the possibility of emasculation of the statutory policy through a narrow judicial construction of 'contributions.' Id., at 83.
39
The 1945 Report of the House Special Committee to Investigate Campaign Expenditures expressed concern over the vast amounts that some labor organizations were devoting to politics:
40
'The scale of operations of some of these organizations is impressive. Without exception, they operate on a Nation-wide basis; and many of them have affiliated local organizations. One was found to have an annual budget for 'educational' work approximating $1,500,000, and among other things regularly supplies over 500 radio stations with 'briefs for broadcasters.' Another, with an annual budget of over $300,000 for political 'education,' has distributed some 80,000,000 pieces of literature, including a quarter million copies of one article. Another, representing an organized labor membership of 5,000,000, has raised $700,000 for its national organizations in union contributions for political 'education' in a few months, and a great deal more has been raised for the same purpose and expended by its local organizations.' H.R.Rep. No. 2093, 78th Cong., 2d Sess. 3.
41
Like the Senate Committee, it advocated extension of § 313 to primaries and nominating conventions, id., at 9, and noted the existence of a controversy over the scope of 'contribution.' Id., at 11. The following year the House Committee made a further study of the activities of organizations attempting to influence the outcome of federal elections. It found that the Brotherhood of Railway Trainmen and other groups employed professional political organizers, sponsored partisan radio programs and distributed campaign literature. H.R.Rep. No. 2739, 79th Cong., 2d Sess. 36 37. It concluded that:
42
'The intent and purpose of the provision of the act prohibiting any corporation or labor organization making any contribution in connection with any election would be wholly defeated if it were assumed that the term 'making any contribution' related only to the donating of money directly to a candidate, and excluded the vast expenditures of money in the activities herein shown to be engaged in extensively. Of what avail would a law be to prohibit the contributing direct to a candidate and yet permit the expenditure of large sums in his behalf? 'The committee is firmly convinced, after a thorough study of the provisions of the act, the legislative history of the same, and the debates on the said provisions when it was pending before the House, that the act was intended to prohibit such expenditures.' Id., at 40.
43
Accordingly, to prevent further evasion of the statutory policy, the Committee attached to its recommendation that the prohibition of contributions by labor organizations be made permanent the additional proposal that the statute
44
'be clarified so as to specifically provide that expenditures of money for salaries to organizers, purchase of radio time, and other expenditures by the prohibited organizations in connection with elections, constitute violations of the provisions of said section, whether or not said expenditures are with or without the knowledge or consent of the candidates.' Id., at 46. (Italics omitted.)
45
Early in 1947 the Special Committee to Investigate Senatorial Campaign Expenditures in the 1946 elections, the Ellender Committee, urged similar action to 'plug the existing loophole,' S.Rep. No. 1, Part 2, 80th Cong., 1st Sess. 38—39, and Senator Ellender introduced a bill to that effect.
46
Shortly thereafter, Congress again acted to protect the political process from what it deemed to be the corroding effect of money employed in elections by aggregated power. Section 304 of the labor bill introduced into the House by Representative Hartley in 1947, like the Ellender bill, embodied the changes recommended in the reports of the Senate and House Committees on Campaign Expenditures. It sought to amend § 313 of the Corrupt Practices Act to proscribe any 'expenditure' as well as 'any contribution,' to make permanent § 313's application to labor organizations and to extend its coverage to federal primaries and nominating conventions. The Report of the House Committee and Education and Labor, which considered and approved the Hartley bill, merely summarized § 304, H.R.Rep. No. 245, 80th Cong., 1st Sess. 46, and this section gave rise to little debate in the House. See 93 Cong.Rec. 3428, 3522. Because no similar measure was in the labor bill introduced by Senator Taft, the Senate as a whole did not consider the provisions of § 304 until they had been adopted by the Conference Committee. In explaining § 304 to his colleagues, Senator Taft, who was one of the conferees, said:
47
'I may say that the amendment is in exactly the same words which were recommended by the Ellender committee, which investigated expenditures by Senators in the last election. * * * In this instance the words of the Smith-Connally Act have been somewhat changed in effect so as to plug up a loophole which obviously developed, and which, if the courts had permitted advantage to be taken of it, as a matter of fact, would absolutely have destroyed the prohibition against political advertising by corporations. If 'contribution' does not mean 'expenditure,' then a candidate for office could have his corporation friends publish an advertisement for him in the newspapers every day for a month before election. I do not think the law contemplated such a thing, but it was claimed that it did, at least when it applied to labor organizations. So all we are doing here is plugging up the hole which developed, following the recommendation by our own Elections Committee, in the Ellender bill.' 93 Cong.Rec. 6439.
48
After considerable debate, the conference version was approved by the Senate, and the bill subsequently became law despite the President's veto. It is this section of the statute that the District Court held did not reach the activities alleged in the indictment.
49
On review under the Criminal Appeals Act of a district court judgment dismissing an indictment on the basis of statutory interpretation, this Court must take the indictment as it was construed by the district judge. United States v. Borden Co., 308 U.S. 188, 60 S.Ct. 182, 84 L.Ed. 181. The court below summarized the allegations of the indictment at the outset of its opinion:
50
'Here the specific charge is that the 'expenditure' violation came in connection with the selection of candidates for a senator and representatives to the United States Congress during the 1954 primary and general elections. It is alleged that defendant paid a specific amount from its general treasury fund to Luckoff and Wayburn Productions, Detroit, Michigan, to defray the costs of certain television broadcasts sponsored by the Union from commercial television station WJBK.
51
'It is charged that the broadcasts urged and endorsed selection of certain persons to be candidates for representatives and senator to the Congress of the United States and included expressions of political advocacy intended by defendant to influence the electorate and to affect the results of the election.
52
'It is further charged that the fund used came from the Union's dues, was not obtained by voluntary political contributions or subscriptions from members of the Union, and was not paid for by advertising or sales.' 138 F.Supp. 54.
53
Thus, for our purposes, the indictment charged appellee with having used union dues to sponsor commercial television broadcasts designed to influence the electorate to select certain candidates for Congress in connection with the 1954 elections.
54
To deny that such activity, either on the part of a corporation or a labor organization, constituted an 'expenditure in connection with any (federal) election' is to deny the long series of congressional efforts calculated to avoid the deleterious influences on federal elections resulting from the use of money by those who exercise control over large aggregations of capital. More particularly, this Court would have to ignore the history of the statute from the time it was first made applicable to labor organizations. As indicated by the reports of the Congressional Committees that investigated campaign expenditures, it was to embrace precisely the kind of indirect contribution alleged in the indictment that Congress amended § 313 to proscribe 'expenditures.' It is open to the Government to prove under this indictment activity by appellee that, except for an irrelevant difference in the medium of communication employed, is virtually indistinguishable from the Brotherhood of Railway Trainmen's purchase of radio time to sponsor candidates or the Ohio C.I.O.'s general distribution of pamphlets to oppose Senator Taft. Because such conduct was claimed to be merely 'an expenditure (by the union) of its own funds to state its position to the world,' the Senate and House Committees recommended and Congress enacted, as we have seen, the prohibition of 'expenditures' as well as 'contributions' to 'plug the existing loophole.'
55
Although not entitled to the same weight as these carefully considered committee reports, the Senate debate preceding the passage of the Taft-Hartley Act, 29 U.S.C.A. § 141 et seq., confirms what these reports demonstrate. A colloquy between Senator Taft and Senator Pepper dealt with the problem confronting us:
56
'Mr. Pepper. Does what the Senator has said in the past also apply to a radio speech? If a national labor union, for example, should believe that it was in the public interest to elect the Democratic Party instead of the Republican Party, or vice versa, would it be forbidden by this proposed act to pay for any radio time, for anybody to make a speech that would express to the people the point of view of that organization?
57
'Mr. Taft. If it contributed its own funds to get somebody to make the speech, I would say they would violate the law.
58
'Mr. Pepper. If they paid for the radio time?
59
'Mr. Taft. If they are simply giving the time, I would say not; I would say that is in the course of their regular business.
60
'Mr. Pepper. What I mean is this: I was not assuming that the radio station was owned by the labor organization. Suppose that in the 1948 campaign, Mr. William Green, as president of the American Federation of Labor, should believe it to be in the interest of his membership to go on the radio and support one party or the other in the national election, and should use American Federation of Labor funds to pay for the radio time. Would that be an expenditure which is forbidden to a labor organization under the statute?
61
'Mr. Taft. Yes.' 93 Cong.Rec. 6439.
62
The discussion that followed, while suggesting that difficult questions might arise as to whether or not a particular broadcast fell within the statute, buttresses the conclusion that § 304 was understood to proscribe the expenditure of union dues to pay for commercial broadcasts that are designed to urge the public to elect a certain candidate or party.1
63
United States v. C.I.O., 335 U.S. 106, 68 S.Ct. 1349, 92 L.Ed. 1849, presented a different situation. The decision in that case rested on the Court's reading of an indictment that charged defendants with having distributed only to union members or purchasers an issue, Vol. 10, No. 28, of 'The CIO News,' a weekly newspaper owned and published by the C.I.O. That issue contained a statement by the C.I.O. president urging all members of the C.I.O. to vote for a certain candidate. Thus, unlike the union-sponsored political broadcast alleged in this case, the communication for which the defendants were indicted in C.I.O. was neither directed nor delivered to the public at large. The organization merely distributed its house organ to its own people. The evil at which Congress has struck in § 313 is the use of corporation or union funds to influence the public at large to vote for a particular candidate or a particular party.
64
Our holding that the District Court committed error when it dismissed the indictment for having failed to state an offense under the statute implies no disrespect for 'the cardinal rule of construction, that where the language of an act will bear two interpretations, equally obvious, that one which is clearly in accordance with the provisions of the Constitution is to be preferred.' Knights Templars' & Masons' Life Indemnity Co. v. Jarman, 187 U.S. 197, 205, 23 S.Ct. 108, 111, 47 L.Ed. 139. The case before us does not call for its application. Here only one interpretation may be fairly derived from the relevant materials. The rule of construction to be invoked when constitutional problems lurk in an ambiguous statute does not permit disregard of what Congress commands.
65
Appellee urges that if, as we hold, 18 U.S.C. § 610, 18 U.S.C.A. § 610, embraces the activity alleged in the indictment, it offends several rights guaranteed by the Constitution.2 The Government replies that the actual restraint upon union political activity imposed by the statute is so narrowly limited that Congress did not exceed its powers to protect the political process from undue influence of large aggregations of capital and to promote individual responsibility for democratic government. Once more we are confronted with the duty of being mindful of the conditions under which we may enter upon the delicate process of constitutional adjudication.
66
The impressive lesson of history confirms the wisdom of the repeated enunciation, the variously expressed admonition, of self-imposed inhibition against passing on the validity of an Act of Congress 'unless absolutely necessary to a decision of the case.' Burton v. United States, 196 U.S. 283, 295, 25 S.Ct. 243, 245, 49 L.Ed. 482.3 Observance of this principle makes for the minimum tension within our democratic political system where 'Scarcely any question arises * * * which does not become, sooner or later, a subject of judicial debate.' 1 De Tocqueville, Democracy in America (4th Am. ed. 1843), 306.
67
The wisdom of refraining from avoidable constitutional pronouncements has been most vividly demonstrated on the rare occasions when the Court, forgetting 'the fallibility of the human judgment,'4 has departed from its own practice. The Court's failure in Dred Scott v. Sandford, 19 How. 393, 15 L.Ed. 691, 'to take the smooth handle for the sake of repose' by disposing of the case solely upon 'the outside issue' and the effects of its attempt 'to settle the agitation' are familiar history.5 Dred Scott does not stand alone. These exceptions have rightly been characterized as among the Court's notable 'self-inflicted wounds.' Charles Evans Hughes, The Supreme Court of the United States, 50.
68
Clearly in this case it is not 'absolutely necessary to a decision,' Burton v. United States, supra, (196 U.S. 283, 25 S.Ct. 245) to canvass the constitutional issues. The case came here under the Criminal Appeals Act because the District Court blocked the prosecution on the ground that the indictment failed to state an offense within § 313 of the Corrupt Practices Act. Our reversal of the district judge's erroneous construction clears the way for the prosecution to proceed.
69
Refusal to anticipate constitutional questions is peculiarly appropriate in the circumstances of this case. First of all, these questions come to us unillumined by the consideration of a single judge—we are asked to decide them in the first instance. Again, only an adjudication on the merits can provide the concrete factual setting that sharpens the deliberative process especially demanded for constitutional decision. Finally, by remanding the case for trial, it may well be that the Court will not be called upon to pass on the questions now raised. Compare United States v. Petrillo, 332 U.S. 1, 9 et seq., 67 S.Ct. 1538, 1542, 91 L.Ed. 1877, with the subsequent adjudication on the merits in United States v. Petrillo, D.C., 75 F.Supp. 176.
70
Counsel are prone to shape litigation, so far as it is within their control, in order to secure comprehensive rulings. This is true both of counsel for defendants and for the Government. Such desire on their part is not difficult to appreciate. But the Court has its responsibility. Matter now buried under abstract constitutional issues may, by the elucidation of a trial, be brought to the surface, and in the outcome constitutional questions may disappear. Allegations of the indictment hypothetically framed to elicit a ruling from this Court or based upon misunderstanding of the facts may not survive the test of proof. For example, was the broadcast paid for out of the general dues of the union membership or may the funds be fairly said to have been obtained on a voluntary basis? Did the broadcast reach the public at large or only those affiliated with appellee? Did it constitute active electioneering or simply state the record of particular candidates on economic issues? Did the union sponsor the broadcast with the intent to affect the results of the election? As Senator Taft repeatedly recognized in the debate on § 304, prosecutions under the Act may present difficult questions of fact. See 352 U.S. 585—587, note 1, 77 S.Ct. 538, 539, note 1. We suggest the possibility of such questions, not to imply answers to problems of statutory construction, but merely to indicate the covert issues that may be involved in this case.
71
Enough has been said to justify withholding determination of the more or less abstract issues of constitutional law. Because the District Court's erroneous interpretation of the statute led it to stop the prosecution prematurely, its judgment must be reversed and the case must be remanded to it for further proceedings not inconsistent with this opinion.
72
Reversed and remanded.
73
Mr. Justice DOUGLAS, with whom the CHIEF JUSTICE and Mr. Justice BLACK join, dissenting.
74
We deal here with a problem that is fundamental to the electoral process and to the operation of our democratic society. It is whether a union can express its views on the issues of an election and on the merits of the candidates, unrestrained and unfettered by the Congress. The principle at stake is not peculiar to unions. It is applicable as well to associations of manufacturers, retail and wholesale trade groups, consumers' leagues, farmers' unions, religious groups and every other association representing a segment of American life and taking an active part in our political campaigns and discussions. It is as important an issue as has come before the Court, for it reaches the very vitals of our system of government.
75
Under our Constitution it is We The People who are sovereign. The people have the final say. The legislators are their spokesmen. The people determine through their votes the destiny of the nation. It is therefore important—vitally important—that all channels of communication be open to them during every election, that no point of view be restrained or barred, and that the people have access to the views of every group in the community.
76
In United States v. C.I.O., 335 U.S. 106, 144, 68 S.Ct. 1349, 1368, 92 L.Ed. 1849, Mr. Justice Rutledge spoke of the importance of the First Amendment rights—freedom of expression and freedom of assembly—to the integrity of our elections. 'The most complete exercise of those rights,' he said, 'is essential to the full, fair and untrammeled operation of the electoral process. To the extent they are curtailed the electorate is deprived of information knowledge and opinion vital to its function.'
77
What the Court does today greatly impairs those rights. It sustains an indictment charging no more than the use of union funds for broadcasting television programs that urge and endorse the selection of certain candidates for the Congress of the United States. The opinion of the Court places that advocacy in the setting of corrupt practices. The opinion generates an environment of evildoing and points to the oppressions and misdeeds that have haunted elections in this country.
78
Making a speech endorsing a candidate for office does not, however, deserve to be identified with antisocial conduct. Until today political speech has never been considered a crime. The making of a political speech up to now has always been one of the preferred rights protected by the First Amendment. It usually costs money to communicate an idea to a large audience. But no one would seriously contend that the expenditure of money to print a newspaper deprives the publisher of freedom of the press. Nor can the fact that it costs money to make a speech—whether it be hiring a hall or purchasing time on the air—make the speech any the less an exercise of First Amendment rights. Yet this statute, as construed and applied in this indictment, makes criminal any 'expenditure' by a union for the purpose of expressing its views on the issues of an election and the candidates. It would make no difference under this construction of the Act whether the union spokesman made his address from the platform of a hall, used a sound truck in the streets, or bought time on radio or television. In each case the mere 'expenditure' of money to make the speech is an indictable offense. The principle applied today would make equally criminal the use by a union of its funds to print pamphlets for general distribution or to distribute political literature at large.
79
Can an Act so construed be constitutional in view of the command of the First Amendment that Congress shall make no law that abridges free speech or freedom of assembly?
80
The Court says that the answer on the constitutional issue must await the development of the facts at the trial.
81
It asks, 'Did the broadcast reach the public at large or only those affiliated with appellee?' But the size of the audience has heretofore been deemed wholly irrelevant to First Amendment issues. One has a right to freedom of speech whether he talks to one person or to one thousand. One has a right to freedom of speech not only when he talks to his friends but also when he talks to the public. It is startling to learn that a union spokesman or the spokesman for a corporate interest has fewer constitutional rights when he talks to the public than when he talks to members of his group.
82
The Court asks whether the broadcast constituted 'active electioneering' or simply stated 'the record of particular candidates on economic issues.' What possible difference can it make under the First Amendment whether it was one or the other? The First Amendment covers the entire spectrum. It protects the impassioned plea of the orator as much as the quiet publication of the tabulations of the statistician or economist. If there is an innuendo that 'active electioneering' by union spokesmen is not covered by the First Amendment, the opinion makes a sharp break with our political and constitutional heritage.
83
The Court asks, 'Did the union sponsor the broadcast with the intent to affect the results of the election?' The purpose of speech is not only to inform but to incite to action. As Mr. Justice Holmes said in his dissent in Gitlow v. People of State of New York, 268 U.S. 652, 673, 45 S.Ct. 625, 632, 69 L.Ed. 1138, 'Every idea is an incitement. It offers itself for belief and if believed it is acted on unless some other belief outweighs it or some failure of energy stifles the movement at its birth.' To draw a constitutional line between informing the people and inciting or persuading them and to suggest that one is protected and the other not by the First Amendment is to give constitutional dignity to an irrelevance. Any political speaker worth his salt intends to sway voters. His purpose to do so cannot possibly rob him of his First Amendment rights, unless we are to reduce that great guarantee of freedom to the protection of meaningless mouthings of ineffective speakers.
84
Finally, the Court asks whether the broadcast was 'paid for out of the general dues of the union membership or may the funds be fairly said to have been obtained on a voluntary basis.' Behind this question is the idea that there may be a minority of union members who are of a different political school than their leaders and who object to the use of their union dues to espouse one political view. This is a question that concerns the internal management of union affairs. To date, unions have operated under a rule of the majority. Perhaps minority rights need protection. But this way of doing it is, indeed, burning down the house to roast the pig. All union expenditures for political discourse are banned because a minority might object.
85
When the exercise of First Amendment rights is tangled with conduct which government may regulate, we refuse to allow the First Amendment rights to be sacrificed merely because some evil may result. Our insistence is that the regulatory measure be 'narrowly drawn' to meet the evil that the government can control. Cantwell v. State of Connecticut, 310 U.S. 296, 311, 60 S.Ct. 900, 906; 84 L.Ed. 1213. Or as the Court said in De Jonge v. State of Oregon, 299 U.S. 353, 364—365, 57 S.Ct. 255, 260, 81 L.Ed. 278, when speaking of First Amendment rights, '* * * the legislative intervention can find constitutional justification only by dealing with the abuse. The rights themselves must not be curtailed.'
86
If minorities need protection against the use of union funds for political speech-making, there are ways of reaching that end without denying the majority their First Amendment rights.1
87
First Amendment rights are not merely curtailed by the construction of the Act which the Court adopts. Today's ruling abolishes First Amendment rights on a wholesale basis. Protection of minority groups, if any, can be no excuse. The Act is not 'narrowly drawn' to meet that abuse.
88
Some may think that one group or another should not express its views in an election because it is too powerful, because it advocates unpopular ideas, or because it has a record of lawless action. But these are not justifications for withholding First Amendment rights from any group—labor or corporate. Cf. United States v. Rumely, 345 U.S. 41, 73 S.Ct. 543, 97 L.Ed. 770. First Amendment rights are part of the heritage of all persons and groups in this country. They are not to be dispensed or withheld merely because we or the Congress thinks the person or group is worthy or unworthy.
89
These constitutional questions are so grave that the least we should do is to construe this Act, as we have in comparable situations, United States v. C.I.O., supra; United States v. Rumely, 345 U.S. 41, 73 S.Ct. 543, 97 L.Ed. 770; United States v. Harriss, 347 U.S. 612, 74 S.Ct. 808, 98 L.Ed. 989, to limit the word 'expenditure' to activity that does not involve First Amendment rights.2
90
The Act, as construed and applied, is a broadside assault on the freedom of political expression guaranteed by the First Amendment. It cannot possibly be saved by any of the facts conjured up by the Court. The answers to the questions reserved are quite irrelevant to the constitutional questions tendered under the First Amendment.
91
I would affirm the judgment dismissing the indictment.
1
'Mr. Barkley. Suppose a certain corporation, for instance, the corporation that makes Bayer aspirin, or Jergens lotion, or any other well-advertised product, employes a commentator to talk about various things, winding up with an advertisement of the product, and suppose that the radio commentator from day to day takes advantage of his employment or his sponsorship to make comments which are calculated to influence the opinions of men or women as to political candidates. Would the corporation sponsoring the particular commentator be violating the law?
'Mr. Taft. I should have to know the exact facts. If, for instance, apart from commentators and the radio, and taking the case of a paid advertisement, suppose a corporation advertises its products, and that every day for 2 weeks before the election it advertises a candidate. I should say that would be a violation of the law. I would say the same thing probably would be true of a radio broadcast of that kind, under certain circumstances, but I think I should like to know the exact facts before expressing an opinion.
'Mr. Barkley. In the case of a commentator who is paid to advertise a certain product, and who in the course of his 15 minutes on the radio may also seek to influence votes, the sponsor may say, either before or after the broadcast, that he is not responsible for what the commentary says; yet he is paying the commentator for his broadcast. Would that still be a violation of law, although the sponsor might excuse himself or attempt to excuse himself by saying he was not responsible for the opinions expressed by the commentator?
'Mr. Taft. I think there are all degrees. It would be for a court to decide. I think as a matter of fact, if that had happened under the old law, there would have been the same question.
'I want to make the point that we are not raising any new questions here. Those same questions could have been raised with respect to corporations during the past 25 years. It is a question of fact: Was the corporation using its money to influence a political election?
'Mr. Magnuson. Let us consider the teamsters. Suppose they have a weekly radio program, as, indeed, they have had for a long time back. Or let us say the AFL has such a radio program.
Let us assume I am running for office and they ask me to be a guest on their program. Suppose I talk on the subject of labor and do not advocate my own candidacy. Nevertheless I am on that program. My name is being advertised and I am being heard by many thousands of people. Would that be an unlawful contribution to my candidacy?
'Mr. Taft. If a labor organization is using the funds provided by its members through payment of union dues to put speakers on the radio for Mr. X against Mr. Y, that should be a violation of the law.
'Mr. Magnuson. They are not paying me anything. They have asked me to be a guest.
'Mr. Taft. I understand, but they are paying for the time on the air. Of course, in each case there is a question of fact to be decided. I cannot answer various hypotheses without knowing all the circumstances. But in each case the question is whether or not a union or a corporation is making a contribution or expenditure of funds to elect A as against B. Labor unions are supposed to keep out of politics in the same way that corporations are supposed to keep out of politics.' 93 Cong.Rec. 6439—6440.
'Mr. Taylor. * * * Take the matter of a radio program sponsored by either a union or a corporation. I think the AFL or the CIO, one or the other, has a news commentator who comments on the news. Could he comment on political candidates favorably or unfavorably?
'Mr. Taft. If the General Motors Corp. had a man speaking on the radio every week to advocate the election of a Republican or a Democratic Presidential candidate, the corporation ought to be punished, and it would be punished under the law. Labor organizations should be subject to the same rule.
'Mr. Taylor. That is altogether different. It is a more subtle thing. When a commentator is broadcasting the news every day he can do a lot more good or harm to a man by coloring his broadcast and presenting it in the guise of a news commentary than he could openly.
'Mr. Taft. The Senator is right. It is a question of fact which would have to be raised in every case. Is it a contribution to a candidate or is it not? Possibly a knock is a boost sometimes. That argument might well be made by a person who was taking part in an election.' 93 Cong.Rec. 6447.
2
'* * * if such an expenditure is prohibited by 18 U.S.C. § 610, the statute violates the provisions of the Constitution of the United States in that the statute (i) abridges freedom of speech and of the press and the right peaceably to assemble and to petition; (ii) abridges the right to choose senators and representatives guaranteed by Article I, § 2 and the Seventeenth Amendment; (iii) creates an arbitrary and unlawful classification and discriminates against labor organizations in violation of the Fifth Amendment, and (iv) is vague and indefinite and fails to provide a reasonably ascertainable standard of guilt in violation of the Fifth and Sixth Amendments.' Brief for appellee, pp. 2—3.
3
Cases are collected in the opinion of Mr. Justice Brandeis in Ashwander v. Tennessee Valley Authority, 297 U.S. 288, 345 et seq., 56 S.Ct. 466, 482, 80 L.Ed. 688.
4
'It must be evident to any one that the power to declare a legislative enactment void is one which the judge, conscious of the fallibility of the human judgment, will shrink from exercising in any case where he can conscientiously and with due regard to duty and official oath decline the responsibility.' 1 Cooley, Constitutional Limitations (8th ed.), 332.
5
A letter written by Mr. Justice Catron to President Buchanan shortly before the decision was handed down reveals an attitude happily exceptional:
'Will you drop (Mr. Justice) Grier a line, saying how necessary it is—& how good the opportunity is, to settle the agitation by an affirmative decision of the Supreme Court, the one way or the other. He ought not to occupy so doubtful a ground as the outside issue—that admitting the constitutionality of the Mo. Comp. line of 1820, still, as no domicile was acquired by the negro at Ft. Snelling, & he returned to Missouri, he was not free. He has no doubt about the question on the main contest, but has been persuaded to take the smooth handle for the sake of repose.' 10 Works of James Buchanan 106.
1
There are alternative measures appropriate to cure this evil which Congress has seen in the expenditure of union funds for political purposes. The protection of union members from the use of their funds in supporting a cause with which they do not sympathize may be cured by permitting the minority to withdraw their funds from that activity. The English have long required labor unions to permit a dissenting union member to refuse to contribute funds for political purposes. Trade Union Act, 1913, 2 & 3 Geo. V, c. 30; Trade Disputes and Trade Unions Act, 1927, 17 & 18 Geo. V, c. 22; Trade Disputes and Trade Unions Act, 1946, 9 & 10 Geo. VI, c. 52.
2
If Congress is of the opinion that large contributions by labor unions to candidates for office and to political parties have had an undue influence upon the conduct of elections, it can prohibit such contributions. And, in expressing their views on the issues and candidates, labor unions can be required to acknowledge their authorship and support of those expressions. Undue influence, however, cannot constitutionally form the basis for making it unlawful for any segment of our society to express its views on the issues sues of a political campaign.
| 23
|
353 U.S. 30
77 S.Ct. 635
1 L.Ed.2d 622
BROTHERHOOD OF RAILROAD TRAINMEN, etc., et al., Petitioners,v.CHICAGO RIVER and INDIANA RAILROAD COMPANY et al.
No. 313.
Argued Feb. 26, 1957.
Decided March 25, 1957.
Mr. William C. Wines, Chicago, Ill., for petitioners.
Mr. Walter J. Cummings, Jr., Chicago, Ill., for respondents.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
We are asked to interpret that provision of the Railway Labor Act1 which created the National Railroad Adjustment Board for the resolution of minor grievances in the event that the parties were unable to settle them by negotiation. The ultimate question is whether a railway labor organization can resort to a strike over matters pending before the Adjustment Board.2
2
The Chicago River and Indiana Railroad Company operates the switching and yard facilities at the Chicago stockyards. A segment of the employees of the River Road were represented by the Brotherhood of Railroad Trainmen. A collective bargaining agreement between the Brotherhood and the River Road was in existence throughout the period covered by this case. The present disagreement arises from an accumulation of twenty-one grievances of members of the Brotherhood against the carrier. Nineteen of these were claims for additional compensation, one was a claim for reinstatement to a higher position, and one was for reinstatement in the employ of the carrier. When negotiations failed, the Brotherhood called a strike. Because of the serious nature of the impending work stoppage, the National Mediation Board proffered its services. The mediator was unsuccessful, and upon his withdrawal, the River Road submitted the controversy to the Adjustment Board. The Brotherhood promptly issued a strike call for four days later.
3
The River Road then sought relief from a District Court. Because of the threatened irreparable injury to the carrier, its employees and the 600 industries and 27 railroads served by it, the complaint prayed for a preliminary injunction, and ultimately a permanent injunction, against a strike by the Brotherhood over the grievances pending before the Adjustment Board. A temporary restraining order was issued, but that order was vacated and the complaint dismissed upon the finding by the district judge that the Norris-LaGuardia Act, 29 U.S.C.A. §§ 101—115, was applicable and that the court lacked jurisdiction to grant the relief requested. The Court of Appeals for the Seventh Circuit reversed. 229 F.2d 926. A permanent injunction was accordingly entered by the District Court and affirmed by the Seventh Circuit. We granted certiorari in order to resolve an important question concerning interpretation and application of the Railway Labor Act.3 352 U.S. 865, 77 S.Ct. 97, 1 L.Ed.2d 73.
4
The grievances for which redress is sought by the Brotherhood are admittedly 'minor disputes' as that phrase is known in the parlance of the Railway Labor Act. These are controversies over the meaning of an existing collective bargaining agreement in a particular fact situation, generally involving only one employee. § 2, Sixth.4 They may be contrasted with 'major disputes' which result when there is disagreement in the bargaining process for a new contract. § 2, Seventh.5 See Elgin, J. & E.R. Co. v. Burley, 325 U.S. 711, 722—724, 65 S.Ct. 1282, 1289, 1290, 89 L.Ed. 1886.
5
The first step toward settlement of either kind of dispute is negotiation and conference between the parties. Section 3, First (i)6 provides that—
6
'The disputes between an employee or group of employees and a carrier or carriers growing out of grievances or out of the interpretation or application of agreements concerning rates of pay, rules, or working conditions * * * shall be handled in the usual manner up to and including the chief operating officer of the carrier designated to handle such disputes * * *.' If the parties are unable to reach an agreement, the section continues—
7
'* * * but, failing to reach an adjustment in this manner, the disputes may be referred by petition of the parties or by either party to the appropriate division of the (National Railroad) Adjustment Board with a full statement of the facts and all supporting data bearing upon the disputes.'
8
Section 3, First (m)7 declares that—
9
'The awards of the several divisions of the Adjustment Board * * * shall be final and binding upon both parties to the dispute * * *.'
10
This language is unequivocal. Congress has set up a tribunal to handle minor disputes which have not been resolved by the parties themselves. Awards of this Board are 'final and binding upon both parties.' And either side may submit the dispute to the Board. The Brotherhood suggests that we read the act to mean only that an Adjustment Board has been organized and that the parties are free to make use of its procedures of they wish to; but that there is no compulsion on either side to allow the Board to settle a dispute if an alternative remedy, such as resort to economic duress, seems more desirable.8 Such an interpretation would render meaningless those provisions in the Act which allow one side to submit a dispute to the Board, whose decision shall be find and binding on both sides. If the Brotherhood is correct, the Adjustment Board could act only if the union and the carrier were amenable to its doing so. The language of § 3, First, reads otherwise and should be literally applied in the absence of a clear showing of a contrary or qualified intention of Congress.
11
Legislative history of the provisions creating the National Railroad Adjustment Board reinforces the literal interpretation of the Act. The present law is a composite of two major pieces of legislation. Most of the basic framework was adopted in 1926.9 In 1934, after eight years of experience, the statute was amended, and in that amendment the Adjustment Board was born.10
12
The distinction between 'major disputes' and 'minor disputes' was found in the 1926 statute. Above the level of negotiation and conference, each was to follow a separate procedure. Section 3, First,11 of that Act called upon carriers or groups of carriers and their employees to agree to the formation of boards of adjustment, composed equally of representatives of labor and management, to resolve the 'minor disputes.' If this step were unsuccessful, these disputes along with the 'major disputes' became a function of the Board of Mediation, predecessor of the National Mediation Board.
13
The obvious lack of any compulsion toward a settlement of disputes was a basic characteristic of the Act and proved to be a major weakness in the procedures for handling 'minor disputes.' As stated in the Report of the House of Representatives Committee on Interstate and Foreign Commerce, after hearings on the 1934 amendment: 'In many instances * * * the carriers and the employees have been unable to reach agreements to establish such boards (of adjustment).' H.R.Rep. No. 1944, 73d Cong., 2d Sess. 3. This was not the only weakness, however. 'Many thousands of these (minor) disputes have been considered by boards established under the Railway Labor Act; but the boards have been unable to reach a majority decision, and so the proceedings have been deadlocked.' Ibid.
14
This condition was in market contrast to the declared purpose of the 1926 Act '* * * to settle all disputes, whether arising out of the application of * * * agreements or otherwise, in order to avoid any interruption to commerce or to the operation of any carrier growing out of any dispute between the carrier and the employee thereof.' § 2, First.12 The Report continued:
15
'These unadjusted disputes have become so numerous that on several occasions the employees have resorted to the issuance of strike ballots and threatened to interrupt interstate commerce in order to secure an adjustment. This has made it necessary for the President of the United States to intervene and establish an emergency board to investigate the controversies. This condition should be corrected in the interest of industrial peace and of uninterrupted transportation service.' Ibid.
16
The means chosen to correct this situation are the present provisions of § 3, First, concerning the National Railroad Adjustment Board. The Board was set up by Congress, making it unnecessary for the parties to agree to establish their own boards.13 In case of a deadlock on the Adjustment Board, which continued the policy of equal representation of labor and management, the appropriate division is allowed to select a neutral referee to sit with them and break the tie. If the division cannot agree even on a referee, the Act provides that one shall be appointed by the National Mediation Board.14 Thus was the machinery built for the disposition of minor grievances.
17
The change was made with the full concurrence of the national railway labor organizations. Commissioner Joseph B. Eastman, Federal Coordinator of Transportation and principal draftsman of the 1934 bill, complimented the unions on conceding the right to strike over 'minor disputes' in favor of the procedures of the Adjustment Board:
18
'The willingness of the employees to agree to such a provision is, in my judgment, a very important concession and one of which full advantage should be taken in the public interest. I regard it as, perhaps, the most important part of the bill.'15
19
Asked if the Act made it a matter of discretion whether disputes would be submitted to the Adjustment Board, he replied in the negative. It was, he said, a matter of duty—
20
'* * * and it is my understanding that the employees in the case of these minor grievances—and that is all that can be dealt with by the adjustment board—are entirely agreeable to those provisions of the law.
21
'I think that is a very important concession on their part. * * * (T)his law is in effect an agreement on the part of the parties to arbitrate all of these minor disputes.'16
22
The chief spokesman for the railway labor organizations was George M. Harrison. He appeared as chairman of the legislative committee of the Railway Labor Executives' Association before both the House of Representatives and the Senate Committee. This Association comprised the twenty-one standard railway labor groups, including the Brotherhood of Railroad Trainmen. He testified before the House Committee:
23
'So, out of all that experience and recognizing the character of the services given to the people of this country by our industry and how essential it is to the welfare of the country, these organizations have come to the conclusion that in respect to these minor-grievance cases that grow out of the interpretation and/or application of the contracts already made that they can very well permit those disputes to be decided, * * * by an adjustment board.'17
24
Later, before the Senate Committee, he declared:
25
'Grievances are instituted against railroad officers' actions, and we are willing to take our chances with this national board because we believe, out of our experience, that the national board is the best and most efficient method of getting a determination of these many controversies that arise on these railroads between the officers and the employees.
26
'These railway labor organizations have always opposed compulsory determination of their controversies. * * * (W)e are now ready to concede that we can risk having our grievances go to a board had get them determined, and that is a contribution that these organizations are willing to make.'18
27
The voice of labor was not unanimous in this concession. The representative of the International Brotherhood of Teamsters vehemently objected to the adoption of § 3, First.
28
'We are unalterably opposed to paragraph M, * * * (which) brings about compulsory arbitration and prevents the use of the only weapon in the hands of organized labor. We believe that a very dangerous precedent would be established with the passage of this paragraph, and to the best of our knowledge it is the first time that any such measure has been enacted by the Congress of the United States.'19
29
This record is convincing that there was general understanding between both the supporters and the opponents of the 1934 amendment that the provisions dealing with the Adjustment Board were to be considered as compulsory arbitration in this limited field. Our reading of the Act is therefore confirmed, not rebutted, by the legislative history.
30
The only question which remains is whether the federal courts can compel compliance with the provisions of the Act to the extent of enjoining a union from striking to defeat the jurisdiction of the Adjustment Board. The Brotherhood contends that the Norris-LaGuardia Act20 has withdrawn the power of federal courts to issue injunctions in labor disputes. That limitation, it is urged, applies with full force to all railway labor disputes as well as labor controversies in other industries.
31
We hold that the Norris-LaGuardia Act cannot be read alone in matters dealing with railway labor disputes. There must be an accommodation of that statute and the Railway Labor Act so that the obvious purpose in the enactment of each is preserved. We think that the purposes of these Acts are reconcilable.
32
In adopting the Railway Labor Act, Congress endeavored to bring about stable relationships between labor and management in this most important national industry. It found from the experience between 1926 and 1934 that the failure of voluntary machinery to resolve a large number of minor disputes called for a strengthening of the Act to provide an effective agency, in which both sides participated, for the final adjustment of such controversies. Accumulation of these disputes had resulted in the aggregate being serious enough to threaten disruption of transportation. Hence, with the full consent of the brotherhoods, the 1934 amendment became law.
33
The Norris-LaGuardia Act, on the other hand, was designed primarily to protect working men in the exercise of organized, economic power, which is vital to collective bargaining. The Act aimed to correct existing abuses of the injunctive remedy in labor disputes. Federal courts had been drawn into the field under the guise either of enforcing federal statutes, principally the Sherman Act, or through diversity of citizenship jurisdiction. In the latter cases, the courts employed principles of federal law frequently at variance with the concepts of labor law in the States where they sat. Congress acted to prevent the injunctions of the federal courts from upsetting the natural interplay of the competing economic forces of labor and capital. Rep. LaGuardia, during the floor debates on the 1932 Act, recognized that the machinery of the Railway Labor Act channeled these economic forces, in matters dealing with railray labor, into special processes intended to compromise them.21 Such controversies, therefore, are not the same as those in which the injunction strips labor of its primary weapon without substituting any reasonable alternative.22
34
In prior cases involving railway labor disputes, this Court has authorized the use of injunctive relief to vindicate the processes of the Railway Labor Act. Virginia R. Co. v. System Federation No. 40, 300 U.S. 515, 57 S.Ct. 592, 81 L.Ed. 789, was an action by the union to enjoin compliance with the Act's provisions for certification of a bargaining representative. The question raised was whether a federal court could issue an injunction in a labor dispute. The Court held:
35
'It suffices to say that the Norris-LaGuardia Act can affect the present decree only so far as its provisions are found not to conflict with those of § 2, Ninth, of the Railway Labor Act, (45 U.S.C.A. § 152, subd. 9), authorizing the relief which has been granted. Such provisions cannot be rendered nugatory by the earlier and more general provisions of the Norris-LaGuardia Act.' Id., 300 U.S. at page 563, 57 S.Ct. at page 607.
36
In Brotherhood of Railroad Trainmen v. Howard, 343 U.S. 768, 72 S.Ct. 1022, 96 L.Ed. 1283, and other similar cases,23 the Court held that the specific provisions of the Railway Labor Act take precedence over the more general provisions of the Norris-LaGuardia Act.
37
'Our conclusion is that the District Court has jurisdiction and power to issue necessary injunctive orders (to enforce compliance with the requirements of the Railway Labor Act) notwithstanding the provisions of the Norris-LaGuardia Act.' Id., 343 U.S. at page 774, 72 S.Ct. at page 1025.
38
This is a clear situation for the application of that principle.24
39
The Brotherhood has cited several cases in which it has been held that the Norris-LaGuardia Act's ban on federal injunctions is not lifted because the conduct of the union in unlawful under some other statute.25 We believe that these are inapposite to this case. None involved the need to accommodate two statutes, when both were adopted as a part of a pattern of labor legislation.
40
The judgment of the Court of Appeals must be affirmed.
41
It is so ordered.
42
Affirmed.
43
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
1
44 Stat. 577, as amended, 45 U.S.C. §§ 151—188, 45 U.S.C.A. §§ 151—188.
2
The relationship of labor and management in the railroad industry has developed on a pattern different from other industries. The fundamental premises and principles of the Railway Labor Act are not the same as those which form the basis of the National Labor Relations Act, 49 Stat. 449, as amended 29 U.S.C. § 151 et seq., 29 U.S.C.A. § 151 et seq. It is one of those differences which underlies the controversy in this case.
3
In addition to the importance of the question, there was a conflict in the decisions of the Courts of Appeals. Brotherhood of Railroad Trainmen v. Central of Georgia R. Co., 229 F.2d 901, decided by the Fifth Circuit, came to a conclusion contrary to that of the Seventh Circuit in this case. Certiorari had been granted in both cases, 352 U.S. 865, 77 S.Ct. 90, 1 L.Ed.2d 73, but we dismissed the writ in the Central of Georgia controversy upon a suggestion of mootness. 352 U.S. 995, 77 S.Ct. 554.
4
45 U.S.C. § 152, Sixth, 45 U.S.C.A. § 152, subd. 6.
5
45 U.S.C. § 152, Seventh, 45 U.S.C.A. § 152, subd. 7.
6
45 U.S.C. § 153, First (i), 45 U.S.C.A. § 153, subd. 1(i).
7
45 U.S.C. § 153, First (m), 45 U.S.C.A. § 153, subd. 1(m).
8
The Brotherhood does not discuss this interpretation in the event that the union had referred the dispute to the Adjustment Board, as is normally the case in grievance disputes, and the carrier was recalcitrant. It is to be doubted that the Brotherhood would support allowing carriers the same right to defeat the jurisdiction of the Adjustment Board that it claims for itself. The statutory language, however, would support no distinction.
9
44 Stat. 577.
10
48 Stat. 1185.
11
44 Stat. 578—579.
12
44 Stat. 577—578.
13
Section 2, Second, authorizes carriers or groups of carriers and their employees to agree to the establishment of system, group or regional boards of adjustment similar to those in the 1926 Act. These boards can have jurisdiction co-extensive with that of the National Board, but the existence of the latter insures against accumulation of disputes through ineffectiveness of the local boards.
14
'Minor disputes' were eliminated from the functions of the Mediation Board by the 1934 amendment. However, that Board can still become involved in a 'minor dispute' case if 'any labor emergency is found by it to exist at any time.' § 5, First, 45 U.S.C. § 155, First, 45 U.S.C.A. § 155, subd. 1. Such was the fact in this case when the threatened strike presented an emergency situation. The Mediation Board enters these cases solely on its own motion, however. It cannot be called into the dispute by either or both of the parties or by an employee or group of employees as is true for disputes not within the jurisdiction of the Adjustment Board.
15
Hearings before House of Representatives Committee on Interstate and Foreign Commerce on H.R. 7650, 73d Cong., 2d Sess. 47.
16
Id., at 58, 60.
17
Id., at 81—82.
18
Hearings before Senate Committee on Interstate Commerce on S. 3266, 73d Cong., 2d Sess. 33, 35.
19
Hearings before House of Representatives Committee, supra, note 15, at 118.
20
47 Stat. 70, as amended, 29 U.S.C. §§ 101—115, 29 U.S.C.A. §§ 101—115.
21
75 Cong.Rec. 5499, 5503—5504.
22
The Adjustment Board cannot entertain a case on its own motion. Its processes must be invoked by one or both of the parties. In this case, the River Road filed the grievances with the Board before seeking an injunction. Cf. the exhaustion of remedies provisions in § 8 of the Norris-LaGuardia Act. 29 U.S.C. § 108, 29 U.S.C.A. § 108.
23
Graham v. Brotherhood of L.F. & E., 338 U.S. 232, 70 S.Ct. 14, 94 L.Ed. 22; Tunstall v. Brotherhood of L.F. & E., 323 U.S. 210, 65 S.Ct. 235, 89 L.Ed. 187; Steele v. Louisville & N.R. Co., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173. See also Rolfes v. Dwellingham, 8 Cir., 198 F.2d 591.
24
The Norris-LaGuardia Act has been held to prevent the issuance of an injunction in a railway labor case involving a 'major dispute.' Brotherhood of Railroad Trainmen v. Toledo, P. & W.R. Co., 321 U.S. 50, 64 S.Ct. 413, 88 L.Ed. 534. In such a case, of course, the Railway Labor Act does not provide a process for a final decision like that of the Adjustment Board in a 'minor dispute' case.
25
Milk Wagon Drivers' Union, etc. v. Lake Valley Farm Products, Inc., 311 U.S. 91, 61 S.Ct. 122, 85 L.Ed. 63; East Texas Motor Freight Lines v. International Brotherhood of Teamsters, 5 Cir., 163 F.2d 10; cf., Mead, Inc., v. International Brotherhood of Teamsters, 1 Cir., 217 F.2d 6; In re Third Avenue Transit Corp., 2 Cir., 192 F.2d 971; Carter v. Herrin Motor Freight Lines, Inc., 5 Cir., 131 F.2d 557; Wilson & Co. v. Birl, 3 Cir., 105 F.2d 948.
| 67
|
353 U.S. 26
77 S.Ct. 607
1 L.Ed.2d 618
SAN DIEGO BUILDING TRADES COUNCIL et al., Petitioners,v.J. S. GARMON et al.
No. 50.
Argued Jan. 16, 1957.
Decided March 25, 1957.
Mr. Charles P. Scully, San Francisco, Cal., for petitioners.
Mr. James W. Archer, San Diego, Cal., for respondents.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
Respondents are a partnership, operating two retail lumber yards in San Diego County, California. In the year before this proceeding began they purchased more than $250,000 worth of material from outside of California for resale at retail. Petitioner unions asked them to sign a contract including a union shop provision. Respondents refused on the ground that it would be a violation of the National Labor Relations Act to sign such a contract before a majority of their employees had selected a union as their collective bargaining agent. The unions commenced peaceful picketing to enforce their demand. About a week later respondents filed suit in the Superior Court for an injunction and damages, alleging that they were in interstate commerce and that the contract sought by the unions would violate the Act.1 On the same day respondents filed with the National Labor Relations Board's regional office a petition asking that the question of the representation of their employees be resolved. The Regional Director dismissed the petition. The unions nevertheless pressed their claim that the National Board had exclusive jurisdiction.2 After a hearing the Superior Court entered an order enjoining the unions from picketing or exerting secondary pressure in support of their demand for a union shop agreement unless and until one or another of the unions had been designated as the collective bargaining representative of respondents' employees. It also awarded respondents $1,000 damages. The California Supreme Court affirmed.3 We granted certiorari. 351 U.S. 923, 76 S.Ct. 782. Recognizing that respondents' business affected interstate commerce, it concluded that the Board's declination, in pursuance of its announced jurisdictional policy, to handle respondents' representation petition left the state courts free to act.4 On the merits the court said:
2
'The assertion of economic pressure to compel an employer to sign the type of agreement here involved is an unfair labor practice under section 8(b)(2) of the (National Labor relations) act. * * * Concerted labor activities for such a purpose thus were unlawful under the federal statute, and for that reason were not privileged under the California law.'5
3
What we have said in Guss v. Utah Labor Relations Board, 353 U.S. 1, 77 S.Ct. 598, and Amalgamated Meat Cutters, Etc. v. Fairlawn Meats, Inc., 353 U.S. 20, 77 S.Ct. 604, is applicable here, and those cases control this one in its major aspects. Respondents, however, argue that the award of damages must be sustained under United Construction Workers, etc. v. Laburnum Construction Corp., 347 U.S. 656, 74 S.Ct. 833, 98 L.Ed. 1025. We do not reach this question. The California Supreme Court leaves us in doubt, but its opinion indicates that it felt bound to 'apply' or in some sense follow federal law in this case. There is, of course, no such compulsion. Laburnum sustained an award of damages under state tort law for violent conduct. We cannot know that the California could would have interpreted its own state law to allow an award of damages in this different situation. We therefore vacate the judgment and remand the case to the Supreme Court of California for proceedings not inconsistent with this opinion and the opinions in Guss v. Utah Labor Relations Board, supra, and Amalgamated Meat Cutters, etc. v. Fairlawn Meats, Inc., supra.
4
Vacated and remanded.
5
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
6
For dissenting opinion of Mr. Justice BURTON and Mr. Justice CLARK, see 353 U.S. 1, 77 S.Ct. 609.
1
Section 8(a)(3) allows an employer to enter into a union security agreement of the type petitioners here were seeking only if the union is the bargaining representative of his employees. 61 Stat. 140, 29 U.S.C. § 158(a) (3), 29 U.S.C.A. § 158(a)(3).
2
They also maintained that by not appealing the regional director's decision respondents had failed to exhaust their remedies under the National Act. On our view of the case, we need not consider this contention.
3
45 Cal.2d 657, 291 P.2d 1.
4
Petitioners' interstate purchases fall below the standards of retail stores. See Amalgamated Meat Cutters, Etc. v. Fairlawn Meats, Inc., 353 U.S. 23, 77 S.Ct. 605, note 4. The Board draws no distinction in the application of its jurisdictional standards between representation and unfair labor practice cases. C. A. Braukman, 94 N.L.R.B. 1609, 1611.
5
45 Cal.2d at page 666, 291 P.2d at page 7.
| 910
|
353 U.S. 43
77 S.Ct. 613
1 L.Ed.2d 631
Leona PEAK, Petitioner,v.UNITED STATES of America.
No. 491.
Argued Feb. 28, 1957.
Decided March 25, 1957.
Mr. John S. Wrinkle, Chattanooga, Tenn., for the petitioner.
Mr. George S. Leonard, Washington, D.C., for the respondent.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
Petitioner instituted this suit in the District Court in 1954 to recover the proceeds of a National Service Life Insurance policy. Petitioner's son, the insured, has been missing since disappearing from his army unit in 1943. The complaint alleges that, prior to the insured's disappearance, his condition was one of 'general debility and weakness and despondency,' and that he had become totally and permanently disabled as a result of certain 'diseases, ailments and injuries.' The complaint further avers that the insured had died in 1943, and that his total and permanent disability during the time the policy was in force entitled him to waiver of premiums on the policy.
2
The District Court dismissed the complaint, holding that the insured would, under the allegations of the complaint, be presumed to be dead as of 1950, and that the policy had lapsed in the interim. 138 F.Supp. 810. The Court of Appeals affirmed. 229 F.2d 503. It held that the complaint contained no allegations which would entitle the trier of fact to conclude that the insured had died at a time when the policy continued in force. Id., 504. We granted certiorari. 352 U.S. 822, 77 S.Ct. 69, 1 L.Ed.2d 47.
3
Respondent urges that the insured's death must be presumed to have occurred in 1950, at the end of seven years' unexplained absence, when this policy had long lapsed for failure to pay premiums. In the alternative, it is argued that, if the petitioner's claim is founded on the insured's death in 1943, it is barred by the six-year statute of limitations, 38 U.S.C. § 445, 38 U.S.C.A. § 445. We hold that, under the allegations in this complaint, petitioner is entitled to take her case to a jury.
4
Congress has provided in 38 U.S.C. § 810, 38 U.S.C.A. § 810 that a presumption of death shall arise upon the continued and unexplained absence of the insured for a period of seven years. Where proof of the insured's death must rest primarily upon his unexplained absence, suit may not be maintained, as a practical matter, prior to the expiration of the statutory seven-year period. Petitioner's cause of action, therefore, 'accrued' at the time when, under § 810, she might have successfully maintained her suit, and that is the date from which the six-year statute of limitations should be computed.
5
Moreover, nothing in the provision of § 810 that the death of the insured 'as of the date of the expiration of such period my * * * be considered as sufficiently proved' precludes the beneficiary from introducing further evidence from which the jury might conclude that the insured's presumed death occurred at an earlier date when the policy was still in force. United States v. Willhite, 4 Cir., 219 F.2d 343.* The jury might so conclude here, if petitioner can prove the allegations of the complaint concerning the insured's frail health and disability of other relevant facts. The presumption leaves it open to prove the precise time of the death, as the statute does not purpose to create a conclusive presumption that the insured died at the end of the seven-year period. To compute the six-year limitation period from the date which the trier of fact establishes as the date of death would be to say that the beneficiary's right to recover had expired before she could have successfully prosecuted a lawsuit to enforce that right. It is only where the beneficiary proves merely the fact of the insured's seven years' unexplained absence that the statute establishes the presumption of death as of the end of that period. The 'contingency on which the claim is founded,' as used in 38 U.S.C. § 445, 38 U.S.C.A. § 445, must, therefore, mean and end of the seven-year period when the presumption of death arose.
6
That seems to us to be the common sense of the matter; and common sense often makes good law.
7
Furthermore the allegations of permanent and total disability at the time of disappearance of the insured, if proved, would bring the petitioner within the premium waiver provisions of 38 U.S.C. § 802(n), 38 U.S.C.A. § 802(n). Since the claim was filed by petitioner within one year subsequent to the presumed date of death, it should be considered as including the lesser claim of premium waiver. Hence, even though the jury found the actual date of death to be later than 1943, the coverage of the policy might continue. As we read the complaint, this alternative cause of action would also not have accrued until 1950; and the six-year statute of limitations had not run when this suit was brought.
8
The judgment of the Court of Appeals is reversed and the case is remanded to the District Court for trial.
9
Reversed.
10
Mr. Justice WHITTAKER took no part in the consideration of decision of this case.
11
Mr. Justice HARLAN, whom Mr. Justice FRANKFURTER and Mr. Justice BURTON join, concurring in part and dissenting in part.
12
Petitioner sues to recover death benefits under a National Service Life Insurance Policy on the life of her son, a draftee in the United States Army. The case is before us only on the complaint, whose substantial allegations are these: The insured disappeared from his post in the Army on or about July 30, 1943, and has not been heard of since. At the time of this disappearance, for some time before, and continuously thereafter until his death, the insured suffered from 'cholera, nervous trouble, mental trouble, St. Vitus Dance, generally debility and weakness and despondency,' which prevented him from pursuing any gainful occupation and entitled him to a waiver of premiums on the policy, and 'to have said policy continue in full force and effect until his death.' It is then alleged that by reason of the insured's disappearance and ailments 'the law presumes and (petitioner) avers that he died on or about July 30, 1943, and while the policy was in full force and effect and . . . that on or about July 30, 1950, at the expiration of said seven years' petitioner became entitled to the policy proceeds. Petitioner finally alleges that she made 'due application' to the Veterans Administration for the policy proceeds and 'to have said insurance contract construed as being in full force and effect at the time of assured's death,' but that her application was refused by the Administration on July 18, 1951.
13
Actions on life insurance policies issued under the National Service Life Insurance Act are governed by a six-year statute of limitations.1 Section 610 of the Act, 38 U.S.C. § 810, 38 U.S.C.A. § 810, abolishes all state law presumptions of death in connection with these policies, and substitutes a statutory presumption of death at the expiration of seven years' unexplained absence.2 And § 602(n) of the Act, 38 U.S.C. § 802(n), 38 U.S.C.A. § 802(n), provides for waiver of premiums under certain conditions, upon applications under certain conditions, in one year after the insured's death.3
14
The Court of Appeals affirmed the dismissal of the complaint for insufficiency and also held the action barred by limitations.4 This Court holds the complaint sufficient and the action not barred.
15
If petitioner can prove that the policy was still in force in 1950, the date when death is presumed under 38 U.S.C. § 810, 38 U.S.C.A. § 810, her suit is clearly timely and she is entitled to recover. I agree with the Court that, liberally read, the complaint states facts which should allow her so to prove.
16
Assuming, however, that the policy was no longer in force in 1950, I think the suit is barred by limitations, and I must dissent from this aspect of the Court's holding. The insured disappeared in 1943. Petitioner alleges that death occurred in 1943, as indeed she must, since we now assume that the policy expired soon thereafter. But if death occurred in 1943, the cause of action accrued at that time, and is therefore barred after six years; and suit was not brought until 1954. Yet petitioner asks us to hold that for the purposes of the statute of limitations we use the presumption of § 810, that death occurs at the expiration of a continued seven-year period of absence, in order to postpone the accrual of a cause of action necessarily founded on a death allegedly occurring at the beginning of the seven years. I do not understand how we can accept any such theory. Congress has provided that the suit must be brought within six years after the cause of action accrued, and that the cause accrues on the 'happening of the contingency on which the claim is founded.'5 The contingency which here starts the running of the statute is clearly the death of the insured. United States v. Towery, 306 U.S. 324, 59 S.Ct. 522, 83 L.Ed. 678. If the insured died in 1943, as the petitioner avers, she should have brought suit within six years thereafter, before 1949. For petitioner is relying on actual death, not the presumed death provided for by Congress in cases of disappearances. She cannot rely on the latter, for Congress has unequivocally stated that the presumption created by seven years' unexplained absence is that the insured died at the end of that period, and the policy was then, by hypothesis, no longer in effect.6
17
The dilemma petitioner faces is clearly self-inflicted. Congress has provided a fair choice. If petitioner can prove death in 1943, as she must if the policy expired then, she has six years within which to bring suit to prove it. If, on the other hand, petitioner has no proof of actual death at all, she must merely keep the policy alive by payment of premiums or application for waiver until the end of seven years, and she then has six more years in which to sue on the basis of presumed death at the end of the seven-year period.
18
The Court says that 'to compute the six-year limitation period from the date which the trier of fact establishes as the date of death would be to say that the beneficiary's right to recover had expired before she could have successfully prosecuted a lawsuit to enforce that rights.' I understand neither the logic nor the policy of this argument. Surely in every lawsuit on a life insurance policy the statute of limitations runs from the date of death and yet the date of death is something to be proved in the lawsuit itself. In fact I can think of no litigation in which the statute of limitations does not run from the time the cause of action accrues and the plaintiff need not prove at trial both that there is a cause of action and that it accrued within the period of limitations. Why is it unfair to say to a plaintiff who must prove a 1943 death that she must prove it within six years thereafter? Not only is it unlikely that plaintiff will be in a better position to prove a 1943 death in 1954 than she was in 1949, but the whole essence of the policy behind statutes of limitations runs counter to any such assumption.
19
It is argued that such a result would be harsh, in that a beneficiary should be left free to prove in the same action either actual or presumed death, and that proof of actual death may not turn up until after six years have passed; yet a beneficiary must wait seven before suing on the basis of presumed death.7 But this is only another way of urging that the statute of limitations be waived every time a plaintiff has difficulty in collecting proof during the period given by the statute. And it has been the consistent opinion of this Court that limitations, particularly against the United States, may not be tolled, without statutory authorization, merely because a plaintiff might not be in a position to carry the burden of proof within the statutory period. McIver v. Ragan, 2 Wheat. 25, 4 L.Ed. 175; McMahon v. United States, 342 U.S. 25, 72 S.Ct. 17, 96 L.Ed. 26; Pillsbury v. United Engineering Co., 342 U.S. 197, 72 S.Ct. 223, 96 L.Ed. 225; Unexcelled Chemical Corp. v. United States, 345 U.S. 59, 73 S.Ct. 580, 57 L.Ed. 821.
20
Important considerations of policy buttress that opinion. Hereafter in every case of disappearance a beneficiary may, without keeping the policy alive, wait thirteen years before using on the policy, and may allege and prove that death occurred thirteen years theretofore. Surely in the intervening years there will have been loss of evidence due to the death of some witnesses, clouding in the recollection of others, and loss of records. In fact in this very case the Government is now put to the task of meeting numerous allegations with respect to the insured's physical and mental condition, the circumstances of his disappearance, all in 1943, and his likely movements after disappearance. The whole purpose of the statute of limitations, it seems to me, is to save litigants the burdensome effort of having to collect and meet such stale evidence. The Court overrides that policy today in order to give one plaintiff, whose case has human appeal, a chance to recover. Thus is bad law made.
*
That was the view even before the presumption of death at the end of seven years' absence was codified. In Davie v. Briggs, 97 U.S. 628, 634, 24 L.Ed. 1086, the Court said, 'If it appears in evidence that the absent person, within the seven years, encountered some specific peril, or within that period came within the range of some impending or immediate danger, which might reasonably be expected to destroy life, the court or jury may infer that life ceased before the expiration of the seven years.'
1
38 U.S.C. § 445, 38 U.S.C.A. § 445, so far as pertinent here, provides: 'No suit * * * on United States Government life (coverted) insurance shall be allowed under this section unless the same shall have been brought within six years after the right accrued for which the claim is made: Provided, That for the purposes of this section it shall be deemed that the right accrued on the happening of the contingency on which the claim is founded * * *.'
2
'No State law providing for presumption of death shall be applicable to claims for National Service Life Insurance. If evidence satisfactory to the Administrator is produced establishing the fact of the continued and unexplained absence of any individual from his home and family for a period of seven years, during which period no evidence of his existence has been received, the death of such individual as of the date of the expiration of such period may, for the purposes of this subchapter, be considered as sufficiently proved.'
3
'Upon application by the insured and under such regulations as the Administrator may promulgate, payment of premiums on such insurance may be waived during the continuous total disability of the insured, which continues or has continued for six or more consecutive months, if such disability commenced (1) subsequent to the date of his application for insurance, (2) while the insurance was in force under premium-paying conditions, and (3) prior to the insured's sixtieth birthday * * *. Provided further, That in any case in which the Administrator finds that the insured's failure to make timely application for waiver of premiums or his failure to submit satisfactory evidence of the existence or continuance of total disability was due to circumstances beyond his control, the Administrator may grant waiver or continuance of waiver of premiums: And provided further, That in the event of death of the insured without filing application for waiver, the beneficiary, within one year after the death of the insured or August 1, 1946, whichever be the later, or, if the beneficiary be insane or a minor, within one year after removal of such legal disability, may file application for waiver with evidence of the insured's right to waiver under this section. * * *'
4
229 F.2d 503.
5
38 U.S.C. § 445, 38 U.S.C.A. § 445.
6
At common law seven years' unexplained absence raised a presumption as to the fact of death but none as to the time of death. Davie v. Briggs, 97 U.S. 628, 634, 24 L.Ed. 1086. Congress, however, in 38 U.S.C. § 810, 38 U.S.C.A. § 810, did not adopt the common-law rule enunciated in Davie v. Briggs, the statute declaring that death is presumed to have occurred at the end of the period of absence.
7
I see no reason why a beneficiary, uncertain as to whether he should rely on actual or presumed death, cannot protect himself by keeping the policy in force and filing his complaint within six years of the insured's disappearance. See Fed.Rules Civ.Proc., rule 8(e)(2), 28 U.S.C.A. I think it untenable to suggest that such a complaint would be demurrable as prematurely brought.
| 78
|
353 U.S. 20
77 S.Ct. 604
1 L.Ed.2d 613
AMALGAMATED MEAT CUTTERS AND BUTCHER WORKMEN OF NORTH AMERICA, LOCAL NO. 427, AFL, et al., Petitioners,v.FAIRLAWN MEATS, Inc.
No. 41.
Argued Jan. 16, 1957.
Decided March 25, 1957.
[Syllabus from 21 intentionally omitted]
Mr. Mozart G. Ratner, Chicago, Ill., for petitioners.
Mr. Stanley Denlinger, Akron, Ohio, for respondent.
[Amicus curiae information intentionally omitted]
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
Respondent operates three meat markets in the vicinity of Akron, Ohio. All of its sales are intrastate, but of its purchases in one year totaling not quite $900,000, slightly more than $100,000 worth came from outside Ohio directly and as much or more indirectly. Petitioner union, after an unsuccessful attempt to organize respondent's employees, asked respondent for recognition as their bargaining agent and for a union shop contract. When respondent refused to enter into such a contract, the union picketed respondent's stores and put some secondary pressure on its suppliers. Upon respondent's complaint, the Court of Common Pleas enjoined the union from picketing respondent, from trespassing upon respondent's premises and from exerting secondary pressure on the suppliers. Petitioners objected throughout that the jurisdiction of the National Labor Relations Board was exclusive. On appeal, the Ohio Court of Appeals (99 Ohio App. 517, 135 N.E.2d 692) found that respondent's business was 'purely of a local character' and interstate commerce, therefore, was not burdened or obstructed. The Court of Appeals held that the union's picketing was unlawful according to Ohio policy, and it continued in effect the injunction granted by the Court of Common Pleas.1 The Ohio Supreme Court dismissed an appeal 'for the reason that no debatable constitutional question is involved.'2 We granted certiorari, 351 U.S. 922, 76 S.Ct. 779.
2
We do not agree that respondent's interstate purchases were so negligible that its business cannot be said to affect interstate commerce within the meaning of § 2(7) of the National Labor Relations Act.3 Cf. National Labor Relations Board v. Denver Building & Construction Trades Council, 341 U.S. 675, 683—685, 71 S.Ct. 943, 948—949, 95 L.Ed. 1284. In this case, unlike Guss v. Utah Labor Relations Board, 353 U.S. 1, 77 S.Ct. 598, and San Diego Building Trades Council v. Garmon, 353 U.S. 26, 77 S.Ct. 607, no effort was made to invoke the jurisdiction of the National Labor Relations Board. Although the extent of respondent's interstate activity seems greater even than that in building Trades Council v. Kinard Constitruction Co., 346 U.S. 933, 74 S.Ct. 373, 98 L.Ed. 423, we will assume that this is a case where it was obvious that the Board would decline jurisdiction.4
3
On this view of the case, our decision in Guss v. Utah Labor Relations Board, 353 U.S. 1, 77 S.Ct. 598, controls. If the proviso to § 10(a) of the National Labor Relations Act, 29 U.S.C.A. § 160(a) operates to exclude state labor boards from disputes within the National Board's jurisdiction in the absence of a cession agreement, it must also exclude state courts. See Garner v. Teamsters, Etc., Union, 346 U.S. 485, 491, 74 S.Ct. 161, 166, 98 L.Ed. 228. The conduct here restrained—an effort by a union not representing a majority of his employees to compel an employer to agree to a union shop contract—is conduct of which the National Act has taken hold. § 8(b)(2), 61 Stat. 141, 29 U.S.C. § 158(b)(2), 29 U.S.C.A. § 158(b)(2). Garner v. Teamsters, etc., Union, supra, teaches that in such circumstances a State cannot afford a remedy parallel to that provided by the Act.
4
It is urged in this case and its companions, however, that state action should be permitted within the area of commerce which the National Board has elected not to enter when such action is consistent with the policy of the National Act. We stated our belief in Guss v. Utah Labor Relations Board, 353 U.S. 10, 11, 77 S.Ct. 603, that 'Congress has expressed its judgment in favor of uniformity.' We add that Congress did not leave it to state labor agencies, to state courts or to this Court to decide how consistent with federal policy state law must be. The power to make that decision in the first instance was given to the National Labor Relations Board, guided by the language of the proviso to § 10(a). This case is an excellent example of one of the reasons why, it may be, Congress was specific in its requirement of uniformity. Petitioners here contend that respondent was guilty of what would be unfair labor practices under the National Act and that the outcome of proceedings before the National Board would, for that reason, have been entirely different from the outcome of the proceedings in the state courts. Without expressing any opinion as to whether the record bears out its factual contention, we note that the opinion of the Ohio Court of Appeals takes no account of the alleged unfair labor practice activity of the employer. Thus, it cannot be said with certainty whether the state court's decree is consistent with the National Act.
5
One final point remains to be considered. At two of respondent's stores, located in suburban shopping centers, the picketing occurred on land owned by or leased to respondent though open to the public for access to the stores. As one of the reasons for finding the picketing unlawful, the Court of Appeals recited this fact, and 'trespassing upon plaintiff's property' is one of the activities specifically enjoined. Whether a State may frame and enforce an injunction aimed narrowly at a trespass of this sort is a question that is not here. Here the unitary judgment of the Ohio court has based on the erroneous premise that it had power to reach the union's conduct in its entirety. Whether its conclusion as to the mere act of trespass would have been the same outside of the context of petitioner's other conduct we cannot know. The judgment therefore is vacated and the case remanded for proceedings not inconsistent with this opinion.
6
Vacated and remanded.
7
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
8
For dissenting opinion of Mr. Justice BURTON and Mr. Justice CLARK, see 353 U.S. 1, 77 S.Ct. 609.
1
99 Ohio App. 517, 135 N.E.2d 689.
2
164 Ohio St. 285, 130 N.E.2d 237.
3
61 Stat. 138, 29 U.S.C. § 152(7), 29 U.S.C.A. § 152(7).
4
The Board's current standards for asserting jurisdiction over retail stores call for annual direct imports from out of state of $1,000,000 or indirect imports of $2,000,000. Hogue & Knott Supermarkets, 110 N.L.R.B. 543. We leave aside the question whether the presence of secondary pressure on respondent's suppliers would have affected the Board's decision whether to take jurisdiction.
| 910
|
353 U.S. 1
77 S.Ct. 609
1 L.Ed.2d 601
P. S. GUSS, Doing Business as Photo Sound Products Manaufacturing Company, Appellant,v.UTAH LABOR RELATIONS BOARD.
No. ___.
March 25, 1957.
[Syllabus intentionally omitted]
Mr. Peter W. Billings, Salt Lake City, Utah, for appellant.
Mr. E. R. Callister, Atty. Gen., of Utah, Salt Lake City, Utah, for appellee.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
The question presented by this appeal and by Amalgamated Meat Cutters, etc. v. Fairlawn Meats, Inc., 353 U.S. 20, 77 S.Ct. 604, and San Diego Building Trades Council v. Garmon, 353 U.S. 26, 77 S.Ct. 607, is whether Congress, by vesting in the National Labor Relations Board jurisdiction over labor relations matters affecting interstate commerce, has completely displaced state power to deal with such matters where the Board has declined or obviously would decline to exercise its jurisdiction but has not ceded jurisdiction pursuant to the proviso to § 10(a) of the National Labor Relations Act.1 It is a question we left open in Building Trades Council v. Kinard Construction Co., 346 U.S. 933, 74 S.Ct. 373, 98 L.Ed. 423.
2
Some background is necessary for an understanding of this problem in federal-state relations and how it assumed its present importance. Since it was first enacted in 1935, the National Labor Relations Act2 has empowered the National Labor Relations Board 'to prevent any person from engaging in any unfair labor practice * * * (defined by the Act) affecting commerce.'3 By this language and by the definition of 'affecting commerce' elsewhere in the Act,4 Congress meant to reach to the full extent of its power under the Commerce Clause. National Labor Relations Board v. Fainblatt, 306 U.S. 601, 606—607, 59 S.Ct. 668, 672, 83 L.Ed. 1014. The Board, however, has never exercised the full measure of its jurisdiction. For a number of years, the Board decided case-by-case whether to take jurisdiction. In 1950, concluding that 'experience warrants the establishment and announcement of certain standards' to govern the exercise of its jurisdiction, Hollow Tree Lumber Co., 91 N.L.R.B. 635, 636, the Board published standards, largely in terms of yearly dollar amounts of interstate inflow and outflow.5 In 1954, a sharply divided Board, see Breeding Transfer Co., 110 N.L.R.B. 493, revised the jurisdictional standards upward.6 This Court has never passed and we do not pass today upon the validity of any particular declination of jurisdiction by the Board or any set of jurisdictional standards.7
3
How many labor disputes the Board's 1954 standards leave in the 'twilight zone' between exercised federal jurisdiction and unquestioned state jurisdiction is not known.8 In any case, there has been recently a substantial volume of litigation raising the question stated at the beginning of this opinion, of which this case is an example.9
4
Appellant, doing business in Salt Lake City, Utah, manufactures specialized photographic equipment for the Air Force on a contract basis. To fulfill his government contracts he purchased materials from outside Utah in an amount 'a little less than $50,000.' Finished products were shipped to Air Force bases, one within Utah and the others outside. In 1953 the United Steelworkers of America filed with the National Labor Relations Board a petition for certification of that union as the bargaining representative of appellant's employees. A consent election was agreed to, the agreement reciting that appellant was 'engaged in commerce within the meaning of Section 2(6), (7) of the National Labor Relations Act.' The union won the election and was certified by the National Board as bargaining representative. Shortly thereafter the union filed with the National Board charges that appellant had engaged in unfair labor practices proscribed by § 8(a)(1), (3) and (5) of the Act.10 Meanwhile, on July 15, 1954, the Board promulgated its revised jurisdictional standards. The Board's Acting Regional Director declined to issue a complaint. He wrote on July 21:
5
'Further proceedings are not warranted, inasmuch as the operations of the Company involved are predominantly local in character, and it does not appear that it would effectuate the policies of the Act to exercise jurisdiction.'
6
The union thereupon filed substantially the same charges with the Utah Labor Relations Board, pursuant to the Utah Labor Relations Act.11 Appellant urged that the State Board was without jurisdiction of a matter within the jurisdiction of the National Board. The State Board, however, found it had jurisdiction and concluded on the merits that appellant had engaged in unfair labor practices as defined by the Utah Act. It granted relief through a remedial order. On a Writ of Review, the Utah Supreme Court affirmed the decision and order of the state administrative agency.12 We noted probable jurisdiction. 352 U.S. 817, 77 S.Ct. 65.
7
On these facts we start from the following uncontroverted premises:
8
(1) Appellant's business affects commerce within the meaning of the National Labor Relations Act and the National Labor Relations Board had jurisdiction. National Labor Relations Board v. Fainblatt, supra.
9
(2) The National Act expressly deals with the conduct charged to appellant which was the basis of the state tribunals' actions. Therefore, if the National Board had not declined jurisdiction, state action would have been precluded by our decision in Garner v. Teamsters Union, 346 U.S. 485, 74 S.Ct. 161, 98 L.Ed. 228.
10
(3) The National Board has not entered into any cession agreement with the Utah Board pursuant to § 10(a) of the National Act.
Section 10(a) provides:
11
'The Board is empowered, as hereinafter provided, to prevent any person from engaging in any unfair labor practice (listed in Section 8) affecting commerce. This power shall not be affected by any other means of adjustment or prevention that has been or may be established by agreement, law, or otherwise: Provided, That the Board is empowered by agreement with any agency of any State or Territory to cede to such agency jurisdiction over any cases in any industry (other than mining, manufacturing, communications, and transportation except where predominantly local in character) even though such cases may involve labor disputes affecting commerce, unless the provision of the State or Territorial statute applicable to the determination of such cases by such agency is inconsistent with the corresponding provision of this Act or has received a construction inconsistent therewith.' (Emphasis added.)
12
The proviso to § 10(a), italicized in the quotation above, was one of the Taft-Hartley amendments to the National Labor Relations Act. Timing and a reference in one of the committee reports indicate that it was drafter in response to the decision of this Court in Bethlehem Steel Co. v. New York State Labor Relations Board, 330 U.S. 767, 67 S.Ct. 1026, 91 L.Ed. 1234.13 In Bethlehem foremen in an enterprise affecting commerce petitioned the New York State Labor Relations Board for certification as a bargaining unit. At that time the National Board was declining, as a matter of policy, to certify bargaining units composed of foremen. The Court held that the federal policy against certifying foremen's units must prevail. However, it took occasion to discuss the efforts of the two boards to avoid conflicts of jurisdiction.
13
'The National and State Boards have made a commendable effort to avoid conflict in this overlapping state of the statutes. We find nothing in their negotiations, however, which affects either the construction of the federal statute or the question of constitutional power insofar as they are involved in this case, since the National Board made no concession or delegation of power to deal with this subject. The election of the National Board to decline jurisdiction in certain types of cases, for budgetary or other reasons presents a different problem which we do not now decide.' Id., 330 U.S. at page 776, 67 S.Ct. at page 1031.
14
Three Justices were led to concur specially, because, as it was stated for the three:
15
'I read * * * (the Court's opinion) to mean that it is beyond the power of the National Board to agree with State agencies enforcing laws like the Wagner Act to divide, with due regard to local interests, the domain over which Congress had given the National Board abstract discretion but which, practically, cannot be covered by it alone. If such cooperative agreements between State and National Boards are barred because the power which Congress has granted to the National Board ousted or superseded State authority, I am unable to see how State authority can revive because Congress has seen fit to put the Board on short rations.' Id., 330 U.S. at page 779, 67 S.Ct. at page 1032.
16
Thus, if the opinion of the Court did not make manifest, the concurring opinion did, that after Bethlehem there was doubt whether a state board could act either after a formal cession by the National Board or upon a declination of jurisdiction 'for budgetary or other reasons.' When we read § 10(a) against this background we find unconvincing the argument that Congress meant by the proviso only to meet the first problem, i.e., cession of jurisdiction over cases the National Board would otherwise handle.
17
The proviso is directed at least equally to the type of cases which the Board might decline 'for budgetary or other reasons' to hear as to the type of cases it might wish to cede to the States for policy reasons—if, indeed, there is any difference between the two classes. Cases in mining, manufacturing, communications and transportation can be ceded only where the 'industry' is 'predominantly local in character.' In other industries, which Congress might have considered to be more or less typically local, it put no such limitation on the Board's power. The Senate Committee spelled the matter out:
18
'The proviso which has been added to this subsection (§ 10(a)) permits the National Board to allow State labor-relations boards to take final jurisdiction of cases in borderline industries (i.e., border line insofar as interstate commerce is concerned), provided the State statute conforms to national policy.'14
19
The Committee minority agreed as to the purpose of the proviso and agreed 'with the majority that it is desirable thus to clarify the relations between the National Labor Relations Board and the various agencies which States have set up to handle similar problems.'15
20
We hold that the proviso to § 10(a) is the exclusive means whereby States may be enabled to act concerning the matters which Congress has entrusted to the National Labor Relations Board. We find support for our holding in prior cases in this Court. In Amalgamated Ass'n of St. Elec. Ry. & Motor Coach Employees v. Wisconsin Board, 340 U.S. 383, 397—398, 71 S.Ct. 359, 367, 95 L.Ed. 364, the Court said:
21
'The legislative history of the 1947 Act refers to the decision of this Court in Bethlehem Steel Co. v. New York State Labor Relations Board, 1947, 330 U.S. 767, 67 S.Ct. 1026, 91 L.Ed. 1234, and, in its handling of the problems presented by that case, Congress demonstrated that it knew how to cede jurisdiction to the states. Congress knew full well that its labor legislation 'preempts the field that the act covers insofar as commerce within the meaning of the act is concerned' and demonstrated its ability to spell out with particularity those areas in which it desired state regulation to be operative.' (Footnotes omitted.)
22
In a footnote to the first sentence quoted above the Court cited § 10(a) and described its authorization to cede jurisdiction only where the state law is consistent with the national legislation as insuring 'that the national labor policy will not be thwarted even in the predominantly local enterprises to which the proviso applies.' Id., 71 S.Ct. 367, note 23. See also Algoma Plywood & Veneer Co. v. Wisconsin Board, 336 U.S. 301, 313, 69 S.Ct. 584, 590, 93 L.Ed. 691; People of State of California v. Zook, 336 U.S. 725, 732, 69 S.Ct. 841, 844, 93 L.Ed. 1005.
23
Our reading of § 10(a) forecloses the argument based upon such cases as H. P. Welch Co. v. New Hampshire, 306 U.S. 79, 59 S.Ct. 438, 83 L.Ed. 500, and Missouri Pacific R. Co. v. Larabee Flour Mills Co., 211 U.S. 612, 29 S.Ct. 214, 53 L.Ed. 352, that 'where federal power has been delegated but lies dormant and unexercised,' Bethlehem Steel Co. v. New York State Labor Relations Board, supra, 330 U.S. at page 775, 67 S.Ct. at page 1031, the States' power to act with respect to matters of local concern is not necessarily superseded. But in each case the question is one of congressional intent. Compare H. P. Welch Co. v. New Hampshire, supra, with Napier v. Atlantic Coast Line R. Co., 272 U.S. 605, 47 S.Ct. 207, 71 L.Ed. 432. And here we find not only a general intent to pre-empt the field but also the proviso to § 10(a), with its inescapable implication of exclusiveness.
24
We are told by appellee that to deny the State jurisdiction here will create a vast no-man's-land, subject to regulation by no agency or court. We are told by appellant that to grant jurisdiction would produce confusion and conflicts with federal policy. Unfortunately, both may be right. We believe, however, that Congress has expressed its judgment in favor of uniformity. Since Congress' power in the area of commerce among the States is plenary, its judgment must be respected whatever policy objections there may be to creation of a no-man's-land.
25
Congress is free to change the situation at will. In 1954 the Senate Committee on Labor and Public Welfare recognized the existence of a no-man's-land and proposed an amendment which would have empowered state courts and agencies to act upon the National Board's declination of jurisdiction.16 The National Labor Relations Board can greatly reduce the area of the no-man's-land by reasserting its jurisdiction and, where States have brought their labor laws into confromity with federal policy, by ceding jurisdiction under § 10(a).17 The testimony given by the Chairman of the Board before the Appropriations Committees shortly before the 1954 revisions of the jurisdictional standards indicates that its reasons for making that change were not basically budgetary. They had more to do with the Board's concept of the class of cases to which it should devote its attention.18
26
The judgment of the Supreme Court of Utah is
27
Reversed.
28
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
29
Mr. Justice BURTON, whom Mr. Justice CLARK joins, dissenting.
30
I believe the Court is mistaken in its interpretation of the proviso which Congress added to § 10(a) of the National Labor Relations Act in 1947.1 It is my view that the proviso was added merely to make it clear that the National Labor Relations Board had the power, by making specific agreements, to cede jurisdiction to state or territorial agencies over certain labor disputes. Congress sought thereby to facilitate state cooperation in the supervision of labor practices affecting interstate commerce. The Court is not justified in interpreting this action as evidencing an unexpressed and sweeping termination of the States' pre-existing power to deal with labor matters over which the Board, for budgetary or other administrative reasons, has declined, or obviously would decline, to exercise its full jurisdiction.
31
The Labor Acts of 1935 and 1947 granted to the Board extensive jurisdiction over labor controversies affecting interstate commerce but neither Act required the Board to assert at all times the full measure of its jurisdiction. In each Act the first sentence of § 10(a) 'empowered,' but did not direct, the Board to prevent unfair labor practices. Likewise, the first sentence of § 10(b) granted the 'power,' instead of imposing the duty, to issue complaints upon receipt of appropriate charges.2 The Board is not a court whose jurisdiction over violations of private rights must be exercised. It is an administrative agency whose function is to adjudicate public rights in a manner that will effectuate the policies of the Act. See Amalgamated Utility Workers v. Consolidated Edison Co., 309 U.S. 261, 60 S.Ct. 561, 84 L.Ed. 738.
32
From the beginning, budgetary limitations and other administrative considerations have prevented the Board from exercising jurisdiction over all cases in which interstate commerce was affected. Congress knew this when, in 1947, it left unchanged the discretionary language of § 10 and added the proviso to § 10(a). Congress has consistently refrained from appropriating funds sufficient to permit the Board to entertain all complaints within its jurisidction. In recent years Congress has repeatedly recognized the Board's jurisdictional practice.3 In National Labor Relations Board v. Denver Bldg. & Trades Council, 341 U.S. 675, 684, 71 S.Ct. 943, 949, 95 L.Ed. 1284, this Court said that 'Even when the effect of activities on interstate commerce is sufficient to enable the Board to take jurisdiction of a complaint, the Board sometimes properly declines to do so, stating that the policies of the Act would not be effectuated by its assertion of jurisdiction in that case.' Courts of Appeals have approved the Board's practice4 and none of the parties to the instant cases question it.
33
Unless restricted by the proviso added to § 10(a), there is title doubt that the States have the necessary power to act in labor controversies within their borders, even when interstate commerce is affected, provided the Federal Government has not occupied the field and the National Board has not taken jurisdiction. Where the Board has declined, or obviously would decline, to take jurisdiction, then federal power lies 'dormant and unexercised.' Bethlehem Steel Co. v. New York State Labor Relations Board, 330 U.S. 767, 775, 67 S.Ct. 1026, 1031, 91 L.Ed. 1234. Unless the proviso stands in their way, the States may then exercise jurisdiction since their action will not conflict with the Board's administration of the Act.5 Substantive provisions of the Act may limit the action of the States. See United Mine Workers v. Arkansas Oak Flooring Co., 351 U.S. 62, 75, 76 S.Ct. 559, 566, 100 L.Ed. 941. But the States are not deprived of all power to act.6
34
By this decision the Court restricts the power of the State to those labor disputes over which the National Board expressly cedes its jurisdiction to the appropriate state agencies. However, the proviso's requirements are so highly restrictive that not a single cession has been made under it.7 The result of this decision is the creation of an extensive no man's land within which no federal or state agency or court is empowered to deal with labor controversies. It is difficult to believe that Congress, sub silentio, intended to take such a step backward in the field of labor relations.
35
The immediate occasion that led to the enactment of the proviso throws light on its proper interpretation. That occasion was this Court's decision in the Bethlehem case, supra, where it was held that a State Board did not have jurisdiction to certify a union of foremen as a collective-bargaining agency because the National Board, by asserting general jurisdiction over foremen's unions, had occupied the field.8 Although an agreement had been negotiated between the National Board and the State Board ceding jurisdiction over certain labor matters, this Court concluded that the agreement did not cede jurisdiction over foremen's unions. Three Justices decried certain overtones they found in the opinion of the Court to the effect that the National Board lacked authority to cede jurisdiction over predominantly local labor matters by agreement with state agencies. It was to clarify the power of the National Board to make such a cession that the proviso was added to § 10(a).
36
While the proviso thus evidenced a congressional purpose to encourage state action, there is no indication that it was intended to wipe out, by implication, the States' recognized power to act when the National Board declined to take jurisdiction. Neither the language of the proviso nor its legislative history discloses a conscious congressional intent to eliminate state authority when the National Board has declined to act. Unequivocal legislative history would be necessary to sustain a conclusion that Congress intended such a drastic result. In the Bethlehem case, supra, the Court did not question the authority of the States to act when the Board, for budgetary or other administrative reasons, declined to exercise its full jurisdiction. The Court expressly refrained from passing on that question9 but three Justices said that they found in the opinion of the Court a 'suggestion that the National Board's declination of jurisdiction 'in certain types of cases, for budgetary or other reasons' might leave room for the State in those situations * * *.' 330 U.S., at page 778, 67 S.Ct. at page 1032.
37
As a matter of fact, in 1947, nearly 40 States lacked labor agencies and comprehensive labor legislation.10 Obviously, those States were ineligible to take advantage of the proviso. It is hard to imagine that Congress meant to make the proviso the exclusive channel for state jurisdiction when so many States would be automatically excluded from using it. The full mission of the proviso was to supply the National Board with express authority to cede jurisdiction over labor disputes by agreement where, as a matter of deliberate judgment, it concluded that due regard for local interests made that course desirable. The Board's jurisdictional yardsticks always have reflected its need to distribute its limited resources so as best to effectuate the policies of the Act. The Board does not 'cede' jurisdiction when it declines to exercise its full jurisdiction; it merely allows the States to exercise their pre-existing authority.11
38
The Court's interpretation of the proviso is contrary to the established practice of the States and of the National Board, as well as to the considered position taken by the Board as amicus curiae. Congress has demonstrated a continuing and deep interest in providing governmental machinery for handling labor controversies. The creation by it of a large, unsupervised no man's land flies in the face of that policy. Due regard for our federal system suggests that all doubts on this score should be resolved in favor of a conclusion that would not leave the States powerless when the federal agency declines to exercise its jurisdiction. As three Justices said in the Bethlehem case, supra:
39
'Since Congress can, if it chooses, entirely displace the States to the full extent of the far-reaching Commerce Clause, Congress needs no help from generous judicial implications to achieve the supersession of State authority. To construe federal legislation so as not needlessly to forbid preexisting State authority is to respect our federal system. Any indulgence in construction should be in favor of the States, because Congress can speak with drastic clarity whenever it chooses to assure full federal authority, completely displacing the States.' 330 U.S., at page 780, 67 S.Ct. at page 1033.
40
I would sustain the jurisdiction of the respective States in these cases.
1
61 Stat. 146, 29 U.S.C. § 160(a), 29 U.S.C.A. § 160(a).
2
49 Stat. 449, as amended, 61 Stat. 136, 29 U.S.C. § 151 et seq., 29 U.S.C.A. § 151 et seq.
3
§ 10(a), 49 Stat. 453, left unchanged in this particular by the Taft-Hartley amendments, 61 Stat. 146, 29 U.S.C. § 160(a), 29 U.S.C.A. § 160(a).
4
'The term 'affecting commerce' means in commerce, or burdening or obstructing commerce or the free flow of commerce, or having led or tending to lead to a labor dispute burdening or obstructing commerce or the free flow of commerce.' § 2(7), 49 Stat. 450, left unchanged by the Taft-Hartley amendments, 61 Stat. 138, 29 U.S.C. § 152(7), 29 U.S.C.A. § 152(7).
5
The NLRB's Press Release of October 6, 1950, can be found at 26 LRR Man. 50.
6
The NLRB's Press Release of July 15, 1954, can be found at 34 LRR Man. 75.
7
But see National Labor Relations Board v. Denver Building & Construction Trades Council, 341 U.S. 675, 684, 71 S.Ct. 943, 949, 95 L.Ed. 1284.
8
Members of the Board disagreed as to the impact of the revision. See Breeding Transfer Co., 110 N.L.R.B. 493, 498—500, 506—508.
9
Among the cases in which courts have sustained state jurisdiction where the Board declines or would decline jurisdiction are Garmon v. San Diego Building Trades Council, 45 Cal.2d 657, 291 P.2d 1; Building Trades Council v. Bonito, 71 Nev. 84, 280 P.2d 295; Hammer v. Local 211, United Textile Workers, 34 N.J.Super. 34, 111 A.2d 308; Dallas General Drivers v. Jax Beer Co., Tex.Civ.App., 276 S.W.2d 384. On the other side are Retail Clerks etc., v. Your Food Stores, 10 Cir., 225 F.2d 659; Universal Car & Service Co. v. International Assn. of Machinists, 35 LRR Man. 2087 (Mich.Cir.Ct.); New York State Labor Board v. Wags Transportation System, Sup., 130 N.Y.S.2d 731, affirmed 284 App.Div. 883, 134 N.Y.S.2d 603.
10
61 Stat. 140, 141, 29 U.S.C. § 158(a)(1, 3, 5), 29 U.S.C.A. § 158(a)(1, 3, 5).
11
Utah Code Ann.1953, 34—1—1 through 34—1—15.
12
5 Utah 2d 68, 296 P.2d 733.
13
The Bethlehem decision was handed down April 7, 1947. The proviso to § 10(a) first appeared when S. 1126, which contained the substance of what was to become the Taft-Hartley Act, was reported out of committee April 17. See S.Rep. No. 105, Pt. 2, 80th Cong., 1st Sess. 38.
14
S.Rep. No. 105, 80th Cong., 1st Sess. 26.
15
S.Rep. No. 105, Pt. 2, 80th Cong., 1st Sess. 38. The minority members also said, 'We think the clarification of relations between the Federal and State boards contemplated under section 10(a) a wise solution to a complex problem.' Id., at 41. See also S.Rep. No. 986, 80th Cong., 2d Sess. 30—31.
16
'The effect * * * of the Board's policy of refusing to assert its jurisdiction has been to create a legal vacuum or no-man's land with respect to cases over which the Board, in its discretion, has refused to assert jurisdiction. In these cases the situation seems to be that the Board will not assert jurisdiction, the States are forbidden to do so, and the injured parties are deprived of any forum in which to seek relief.' S.Rep. No. 1211, 83d Cong., 2d Sess. 18. The minority agreed that 'When the Federal Board refuses to take a case within its jurisdiction, the State agencies or courts are nevertheless without power to take jurisdiction, since the dispute is covered by the Federal act, even though the Federal Board declines to apply the act. There is thus a hiatus—a no man's land—in which the Federal Board declines to exercise its jurisdiction and the State agencies and courts have no jurisdiction.' Id., Pt. 2, P. 14. The Committee's bill, S. 2650, was recommitted. 100 Cong.Rec. 6203.
17
The National Labor Relations Board has informed us in its brief amicus curiae in these cases that it has been unable, because of the conditions prescribed by the proviso to § 10(a), to consummate any cession agreements.
18
Hearings before Subcommittee of House Committee on Appropriations, Department of Labor and Related Independent Agencies, 83d Cong., 20 Sess. 309, 315, 323.
1
Section 10(a) of the National Labor Relations Act of 1935, 49 Stat. 453, was amended by the Labor Management Relations Act of 1947 by the addition of the proviso shown below:
'Sec. 10(a) The Board is empowered, as hereinater provided, to prevent any person from engaging in any unfair labor practice (listed in section 8) affecting commerce. This power shall not be affected by any other means of adjustment or prevention that has been or may be established by agreement, law, or otherwise: Provided, That the Board is emplowered by agreement with any agency of any State or Territory to cede to such agency jurisdiction over any cases in any industry (other than mining, manufacturing, communications, and transportation except where predominantly local in character) even though such cases may involve labor disputes affecting commerce, unless the provision of the State or Territorial statute applicable to the determination of such cases by such agency is inconsistent with the corresponding provision of this Act or has received a construction inconsistent therewith.' 61 Stat. 146, 29 U.S.C. § 160(a), 29 U.S.C.A. § 160(a).
2
'(b) Whenever it is charged that any person has engaged in or is engaging in any such unfair labor practice, the Board or any agent or agency designated by the Board for such purposes, shall have power to issue and cause to be served upon such person a complaint stating the charges in that respect, the containing a notice of hearing before the Board or a member thereof, or before a designated agent or agency, at a place therein fixed, not less than five days after the serving of said complaint * * *.' 49 Stat. 453, 61 Stat. 146, 29 U.S.C. § 160(b), 29 U.S.C.A. § 160(b).
3
See Report of the Joint Committee on Labor-Management Relations, S.Rep. No. 986, Pt. 3, 80th Cong., 2d Sess. 11—15; S.Rep. No. 99, 81st Cong., 1st Sess. 40; H.R.Rep. No. 1852, 81st Cong., 2d Sess. 10; Hearings before Senate Committee on Labor and Public Welfare on S. 249, Pt. 1, 81st Cong., 1st Sess. 175—177; Hearings before Senate Committee on Expenditures in the Executive Departments on S.Res. 248, 81st Cong., 2d Sess. 40, 120.
4
E.g., Optical Workers' Union Local 24859 v. National Labor Relations Board, 5 Cir., 227 F.2d 687; Local Union No. 12, Progressive Mine Workers of America v. National Labor Relations Board, 7 Cir., 189 F.2d 1; Haleston Drug Stores v. National Labor Relations Board, 9 Cir., 187 F.2d 418. See National Labor Relations Board v. Indiana & Michigan Electric Co., 318 U.S. 9, 18 19, 63 S.Ct. 394, 87 L.Ed. 579. The Board discusses its jurisdictional practice in Breeding Transfer Co., 110 N.L.R.B. 493. See also, Note, Discretionary Administrative Jurisdiction of the NLRB Under the Taft-Hartley Act, 62 Yale L.J. 116 (1952).
5
'* * * The care we took in the Garner Case (Garner v. Teamsters, Chauffers & halpers, 346 U.S. 485, 74 S.Ct. 161, 98 L.Ed. 228) to demonstrate the existing conflict between state and federal administrative remedies in that case was, itself, a recognition that if no conflict had existed, the state procedure would have survived.' United Construction Workers, etc. v. Laburnum Construction Corp., 347 U.S. 656, 665, 74 S.Ct. 833, 838, 98 L.Ed. 1025. See also, Weber v. Anheuser-Busch, Inc., 348 U.S. 468, 479—480, 75 S.Ct. 480, 487, 99 L.Ed. 546.
6
See Southern Pacific Co. v. Arizona ex rel. Sullivan, 325 U.S. 761, 65 S.Ct. 1515, 89 L.Ed. 1915; Terminal Railroad Ass'n v. Brotherhood of Railroad Trainmen, 318 U.S. 1, 63 S.Ct. 420, 87 L.Ed. 571; H. P. Welch Co. v. New Hampshire, 306 U.S. 79, 59 S.Ct. 438, 83 L.Ed. 500; Northwestern Bell Telephone Co. v. Nebraska State Railway Commission, 297 U.S. 471, 56 S.Ct. 536, 80 L.Ed. 810; Missouri Pacific R. Co. v. Larable Flour Mills Co., 211 U.S. 612, 29 S.Ct. 214, 53 L.Ed. 352.
7
The National Labor Relations Board in its brief filed in these cases states that—
'It should be noted here that the Board has been unable, because of the prescribed conditions, to consummate any such agreements. Congress has been aware of this situation and considered the feasibility of deleting these conditions in order to reduce the tremendous volume of cases brought before the Board. S.Rep.No. 986, JointCommittee Report, 80th Cong., 2d Sess., 31 (1948). Congress, however, has taken no action in this regard. The advocates of federal preemption argue from this post-legislative history that Congress has thereby manifested its intent to preclude State action in the absence of cession by the Board. Precisely what inference may be drawn from such Congressional inaction is, in our judgment, wholly speculative.'
8
'* * * It (the National Board) made clear that its refusal to designate foremen's bargaining units was a determination and an exercise of its discretion to determine that such units were not appropriate for bargaining purposes. Maryland Drydock Co., 49 N.L.R.B. 733. We cannot, therefore, deal with this as a case where federal power has been delegated but lies dormant and unexercised.
'* * * The federal board has jurisdiction of the industry in which these particular employers are engaged and has asserted control of their labor relations in general. It asserts, and rightfully so, under our decision in the Packard case, supra (Packard Motor Car Co. v. N.L.R.B., 330 U.S. 485, 67 S.Ct. 789, 91 L.Ed. 1040), its power to decide whether these foremen may constitute themselves a bargaining unit. We do not believe this leaves room for the operation of the state authority asserted.' 330 U.S., at pages 775, 776, 67 S.Ct. at page 1031.
9
'The National and State Boards have made a commendable effort to avoid conflict in this overlapping state of the statutes. We find nothing in their negotiations, however, which affects either the construction of the federal statute or the question of constitutional power insofar as they are involved in this case, since the National Board made no concession or delegation of power to deal with this subject. The election of the National Board to decline jurisdiction in certain types of cases, for budgetary or other reasons presents a different problem which we do not now decide.' 330 U.S., at page 776, 67 S.Ct. at page 1031.
10
In 1947 only 11 States had comprehensive labor statutes. Of those, eight had established an administrative procedure for the adjudication of unfair labor practices while three had left these matters to conventional law-enforcement agencies—prosecuting attorneys and regular courts. See Killingsworth, State Labor Relations Acts (1948), 1—3, 111—112. Labor legislation in the other 37 States was fragmentary. Killingsworth said of these laws 'that they are aimed exclusively at one or a few union practices, place few or no restrictions on employers, and do not attempt to establish a comprehensive labor relations policy.' Id., at 3.
11
When in 1954 the Board revised upward its jurisdictional yardsticks, it stated that 'a desire to establish broader State jurisdiction is in no wise a factor in our decision.' Breeding Transfer Co., 110 N.L.R.B. 493, 497.
| 910
|
353 U.S. 72
77 S.Ct. 618
1 L.Ed.2d 652
UNITED STATES of America, ex rel. Anastasios HINTOPOULOS, et ux., Petitioners,v.Edward J. SHAUGHNESSY, District Director of Immigration and NaturalizationService at the Port of New York.
No. 205.
Argued March 4, 1957.
Decided March 25, 1957.
Mr. Jay Nicholas Long, New York City, for petitioner.
Mr. Maurice A. Roberts, Washington, D.C., for respondent.
Mr. Justice HARLAN delivered the opinion of the Court.
1
This is a habeas corpus proceeding to test the validity of an order of the Board of Immigration Appeals denying petitioners' request for suspension of deportation.
2
Petitioners are husband and wife, both aliens. Prior to 1951 both worked as seamen on foreign vessels. In July 1951 the wife lawfully entered the United States as a crew member of a ship in a United States port. Being pregnant, she sought medical advice; subsequently she decided in the interest of her health to stay ashore. A month later, on the next occasion his ship arrived in the United States, her husband joined her; he also failed to leave on the expiration of his limited lawful stay.1 In November 1951 their child was born; the child is, of course, an American citizen by birth. In January 1952 petitioners voluntarily disclosed their illegal presence to the Immigration Service and applied for suspension of deportation under § 19(c) of the Immigration Act of 1917, which provides, in part:
3
'In the case of any alien * * * who is deportable under any law of the United States and who has proved good moral character for the preceding five years, the Attorney General may * * * suspend deportation of such alien if he is not ineligible for naturalization * * * if he finds (a) that such deportation would result in serious economic detriment to a citizen or legally resident alien who is the spouse, parent, or minor child of such deportable alien * * *.'2
4
Deportation proceedings were instituted in May 1952 and a hearing was held. On the undisputed facts both aliens were found deportable. As to the issue of suspension of deportation, the Hearing Officer, while finding petitioners eligible for such relief, denied the request, stating as follows:
5
'Both respondents have applied for suspension of deportation on the ground of the economic detriment that would befall their minor son in the event they were deported. * * * Both disclaim having a criminal record anywhere and both allege that they have been persons of good moral character. Evidence of record would tend to corroborate their testimony in this respect. Their only income is from the employment of the male respondent on two jobs * * *. Their joint assets consist of savings in the sum of about $500 and their furniture and other personal property which they value at $1500. While it would seem that their son * * * would suffer economically if his parents should be deported, it is not believed that as a matter of administrative discretion the respondents' applications for suspension of deportation should be granted. They have been in the United States for a period of less than one year. They have no relatives in this country other than each other and their son. To grant both this form of relief upon the accident of birth in the United States of their son would be to deprive others, who are patiently awaiting visas under their already oversubscribed quotas. It is noted also that neither respondent reported his and her presence in the United States at any time until January, 1952 when they filed applications for suspension of deportation just two months after the birth of their child. * * *'
6
The Board of Immigration Appeals heard petitioners' appeal, and on March 18, 1954, upheld the Hearing Officer's recommendation and denied suspension of deportation. The Board stated:
7
'It is obvious that the American citizen infant child is dependent upon the alien parents for economic support, care and maintenance. Documentary and other evidence establish good moral character for the requisite period. The aliens have no connection with subversive groups.
8
'As stated above, we have, in the instant case, a family consisting of two alien parents illegally residing in the United States and one American citizen child, age about two and one-half years. These respondents have been in the United States for a period of less than three years. Both arrived in this country as seamen. they have no other dependents or close family ties here. The record indicates that the male respondent may be able to obtain work as a Greek seaman and earn about $85 monthly.
9
'Notwithstanding the Fact that * * * the deportation of these respondents would result in a serious economic detriment to an American citizen infant child, the granting or withholding of maximum discretionary relief depends on the factors and merits in each individual case, and is a matter of administrative discretion. We have carefully examined the facts and circumstances in the instant case and we find that the granting of the maximum relief is not warranted by the record in the case. * * *'
10
Petitioners thereupon moved for reconsideration. On May 5, 1954, the Board denied the motion, stating:
11
'Counsel's motion sets forth no matters of which we were unaware at the time our previous decision was rendered. It is crystal clear that Congress intended to greatly restrict the granting of suspension of deportation by the change of phraseology which was used in Section 244(a) of the Immigration and Nationality Act (of 1952) as well as the Congressional comment at the time this provision was enacted.3 We indicated in our previous order that the deportation of the respondents would result in a serious economic detriment to their citizen minor child, and we do not question that the respondents have established the statutory requirements for suspension of deportation * * *.
12
'Upon our further review of the cases of the two respondents, we adhere to our rpevious decision that suspension of deportation should be denied as a matter of administrative discretion * * *.'
13
Taken into custody for deportation, petitioners instituted the present habeas corpus proceeding, alleging that the Board abused its discretion in denying their application for suspension of deportation. The District Court dismissed the writ, 133 F.Supp. 433, and the Court of Appeals, one judge dissenting, affirmed, 2 Cir., 233 F.2d 705. We granted certiorari. 352 U.S. 819, 77 S.Ct. 53, 1 L.Ed.2d 45.
14
We do not think that there was error in these proceedings. It is clear from the record that the Board applied the correct legal standards in deciding whether petitioners met the statutory prerequisites for suspension of deportation. The Board found that petitioners met these standards and were eligible for relief. But the statute does not contemplate that all aliens who meet the minimum legal standards will be granted suspension. Suspension of deportation is a matter of discretion and of administrative grace, not mere eligibility; discretion must be exercised even though statutory prerequisites have been met.4
15
Nor can we say that it was abuse of discretion to withhold relief in this case. The reasons relied on by the Hearing Officer and the Board—mainly the fact that petitioners had established no roots or ties in this country—were neither capricious nor arbitrary.
16
Petitioners urge that the Board applied an improper standard in exercising its discretion when, in its opinion on rehearing, it took into account the congressional policy underlying the Immigration and Nationality Act of 1952, the latter being concededly inapplicable to this case. We cannot agree with this contention. The second opinion makes clear that the Board still considered petitioners eligible for suspension under the 1917 Act5 and denied relief solely as a matter of discretion. And we cannot say that it was improper or arbitrary for the Board to be influenced, in exercising that discretion, by its views as to congressional policy as manifested by the 1952 Act. Section 19(c) does not state what standards are to guide the Attorney General in the exercise of his discretion. Surely it is not unreasonable for him to take cognizance of present-day conditions and congressional attitudes, any more than it would be arbitrary for a judge, in sentencing a criminal, to refuse to suspend sentence because contemporary opinion, as exemplified in recent statutes, has increased in rigour as to the offense involved. This conclusion is fortified by the fact that § 19(c) provides for close congressional supervision over suspensions of deportation. In every case where suspension for more than six months is granted a report must be submitted to Congress, and if thereafter Congress does not pass a concurrent resolution approving the suspension of deportation, the alien must then be deported.6 In other words, every such suspension must be approved by Congress, and yet petitioners would have us hold that the Attorney General may not take into account the current policies of Congress in exercising his discretion. This we cannot do.
17
There being no error, the judgment is affirmed.
18
Affirmed.
19
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
20
Mr. Justice DOUGLAS, with whom Mr. Justice BLACK concurs, dissenting.
21
This case, on its face, seems to be an instance of a deportation which would 'result in serious economic detriment to a citizen,' as those words are used in § 19(c) of the Immigration Act of 1917.
22
The citizen is a five-year-old boy who was born here and who, therefore, is entitled to all the rights, privileges, and immunities which the Fourteenth Amendment bestows on every citizen. A five-year-old boy cannot enjoy the educational, spiritual, and economic benefits which our society affords unless he is with his parents. His parents are lawabiding and self-supporting. From this record it appears that they are good members of the community. They do not seem to have done anything illegal or antisocial that should penalize their American son.
23
It would seem, therefore, that the maintenance of this young American citizen in a home in America is the way to effectuate the policy of the 1917 Act.
24
The Board did not treat the case that way. Instead it imported into the 1917 Act the standard prescribed by the 1952 Act, which concededly is inapplicable here. That was the error which led Judge Frank to dissent below. 2 Cir., 233 F.2d 705, 709, 710. I think Judge Frank was right. Prevailing congressional policy on the approval or disapproval of suspension orders in nowise affects the standards prescribed for administrative action under the 1917 Act.
25
The Board erroneously followed irrelevant standards instead of exercising its discretion under the applicable statute, viz. § 19(c) of the 1917 Act.
1
Under certain conditions alien crewmen are permitted to enter the United States for periods not exceeding 29 days. See 8 U.S.C. §§ 1281—1287, 8 U.S.C.A. §§ 1281—1287.
2
8 U.S.C. (1946 ed., Supp. V) § 155(c), now 8 U.S.C.A. § 1254(a).
3
Section 244 of the 1952 Act, 8 U.S.C. § 1254(a), 8 U.S.C.A. § 1254(a), provides, in pertinent part: 'As hereinafter prescribed in this section, the Attorney General may, in his discretion, suspend deportation * * * in the case of an alien who—
'(5) * * * has been physically present in the United States for a continuous period of not less than ten years * * * and proves that during all of such period he has been and is a person of good moral character; has not been served with a final order of deportation * * * and is a person whose deportation would, in the opinion of the Attorney General, result in exceptional and extremely unusual hardship to the alien or to his spouse, parent, or child, who is a citizen or an alien lawfully admitted for permanent residence.'
A report of the Senate Judiciary Committee on this provision states: 'The bill accordingly establishes a policy that the administrative remedy should be available only in the very limited category of cases in which the deportation of the alien would be unconscionable. Hardship or even unusual hardship to the alien or to his spouse, parent, or child is not sufficient to justify suspension of deportation. * * *' S.Rep. No. 1137, 82d Cong., 2d Sess. 25. (Footnote not in original.)
4
United States ex rel. Kaloudis v. Shaughnessy, 2 Cir., 180 F.2d 489; United States ex rel. Adel v. Shaughnessy, 2 Cir., 183 F.2d 371. Cf. Jay v. Boyd, 351 U.S. 345, 76 S.Ct. 919, 100 L.Ed. 1242.
5
Petitioners would clearly be ineligible for suspension under the 1952 Act. See note 3, supra.
6
The statute provides: 'If the deportation of any alien is suspended under the provisions of this subsection for more than six months, a complete and detailed statement of the facts and pertinent provisions of law in the case shall be reported to the Congress with the reasons for such suspension. These reports shall be submitted on the 1st and 15th day of each calendar month in which Congress is in session. If during the session of the Congress at which a case is reported, or prior to the close of the session of the Congress next following the session at which a case is reported, the Congress passes a concurrent resolution stating in substance that it favors the suspension of such deportation, the Attorney General shall cancel deportation proceedings. If prior to the close of the session of the Congress next following the session at which a case is reported, the Congress does not pass such a concurrent resolution, the Attorney General shall thereupon deport such alien in the manner provided by law * * *.' 8 U.S.C. (1946 ed., Supp. V) § 155(c).
| 12
|
353 U.S. 53
77 S.Ct. 623
1 L.Ed.2d 639
Albert ROVIARO, Petitioner,v.UNITED STATES of America.
No. 58.
Argued Dec. 11, 1956.
Decided March 25, 1957.
Mr. Maurice J. Walsh, Chicago, Ill., for petitioner.
Mr. James W. Kanpp, Washington, D.C., for respondent.
Mr. Justice BURTON delivered the opinion of the Court.
1
This case concerns a conviction for violation of the Narcotic Drugs Import and Export Act, as amended.1 The principal issue is whether the United States District Court committed reversible error when it allowed the Government to refuse to disclose the identity of an undercover employee who had taken a material part in bringing about the possession of certain drugs by the accused, had been present with the accused at the occurrence of the alleged crime, and might be a material witness as to whether the accused knowingly transported the drugs as charged. For the reasons hereafter stated, we hold that, under the circumstances here present, this was reversible error.
2
In 1955, in the Northern District of Illinois, petitioner, Albert Roviaro, was indicted on two counts by a federal grand jury. The first count charged that on August 12, 1954, at Chicago, Illinois, he sold heroin to one 'John Doe' in violation of 26 U.S.C. § 2554(a), 26 U.S.C.A. § 2554(a). The second charged that on the same date and in the same city he 'did then and there fraudulently and knowingly receive, conceal, buy and facilitate the transportation and concealment after importation of . . . heroin, knowing the same to be imported into the United States contrary to law; in violation of Section 174, Title 21, United States Code.'
3
Before trial, petitioner moved for a bill of particulars requesting, among other things, the name, address and occupation of 'John Doe.' The Government objected on the ground that John Doe was an informer and that his identity was privileged. The motion was denied.
4
Petitioner, who was represented by counsel, waived a jury and was tried by the District Court. During the trial John Doe's part in the charged transaction was described by government witnesses, and counsel for petitioner, in cross-examining them, sought repeatedly to learn John Doe's identity. The court declined to permit this cross-examination and John Doe was not produced, identified, or otherwise made available. Petitioner was found guilty on both counts and was sentenced to two years' imprisonment and a fine of $5 on each count, the sentences to run concurrently.2 The Court of Appeals sustained the conviction, holding that the concurrent sentence was supported by the conviction on Count 2 and that the trial court had not abused its discretion in denying petitioner's requests for disclosure of Doe's identity. 7 Cir., 229 F.2d 812. We granted certiorari, 351 U.S. 936, 76 S.Ct. 834, 100 L.Ed. 1464, in order to pass upon the propriety of the nondisclosure of the informer's identity and to consider an alleged conflict with Portomene v. United States, 5 Cir., 221 F.2d 582; United States v. Conforti, 7 Cir., 200 F.2d 365; and Sorrentino v. United States, 9 Cir., 163 F.2d 627.
5
At the trial, the Government relied on the testimony of two federal narcotics agents, Durham and Fields, and two Chicago police officers, Bryson and Sims, each of whom knew petitioner by sight. On the night of August 12, 1954, these four officers met at 75th Street and Prairie Avenue in Chicago with an informer described only as John Doe.3 Doe and his Cadillac car were searched and no narcotics were found. Bryson secreted himself in the trunk of Doe's Cadillac, taking with him a device with which to raise the trunk lid from the inside. Doe then drove the Cadillac to 70th Place and St. Lawrence Avenue, followed by Durham in one government car and Field and Sims in another. After an hour's wait, at about 11 o'clock, petitioner arrived in a Pontiac, accompanied by an unidentified man. Petitioner immediately entered Doe's Cadillac, taking a front seat beside Doe. They then proceeded by a circuitous route to 74th Street near Champlain Avenue. Both government cars trailed the Cadillac but only the one driven by Durham managed to follow it to 74th Street. When the Cadillac came to a stop on 74th Street, Durham stepped out of his car onto the sidewalk and saw petitioner alight from the Cadillac about 100 feet away. Durham saw petitioner walk a few feet to a nearby tree, pick up a small package, return to the open right front door of the Cadillac, mack a motion as if depositing the package in the car, and then wave to Doe and walk way. Durham went immediately to the Cadillac and recovered a package from the floor. He signaled to Bryson to come out of the trunk and then walked down the street in time to see petitioner re-enter the Pontiac, parked nearby, and ride away.
6
Meanwhile, Bryson, concealed in the trunk of the Cadillac, had heard a conversation between John Doe and petitioner after the latter had entered the car. He heard petitioner greet John Doe and direct him where to drive. At one point, petitioner admonished him to pull over to the curb, cut the motor, and turn out the lights so as to lose a 'tail.' He then told him to continue 'further down.' Petitioner asked about money Doe owed him. He advised Doe that he had brought him 'three pieces this time.' When Bryson heard Doe being ordered to stop the car, he raised the lid of the trunk slightly. After the car stopped, he saw petitioner walk to a tree, pick up a package, and return toward the car. He heard petitioner say, 'Here it is,' and 'I'll call you in a couple of days.' Shortly thereafter he heard Durham's signal to come out and emerged from the trunk to find Durham holding a small package found to contain three glassine envelopes containing a white powder.
7
A field test of the powder having indicated that it contained an opium derivative, the officers, at about 12:30 a.m., arrested petitioner at his home and took him, along with Doe, to Chicago police headquarters. There petitioner was confronted with Doe, who denied that he knew or had ever seen petitioner.4 Subsequent chemical analysis revealed that the powder contained heroin.
I.
8
Petitioner contends that the trial court erred in upholding the right of the Government to withhold the identity of John Doe. He argues that Doe was an active participant in the illegal activity charged and that, therefore, the Government could not withhold his identity, his whereabouts, and whether he was alive or dead at the time of trial.5 The Government does not defend the nondisclosure of Doe's identity with respect to Count 1, which charged a sale of heroin to John Doe, but it attempts to sustain the judgment on the basis of the conviction on Count 2, charging illegal transportation of narcotics.6 It argues that the conviction on Count 2 may properly be upheld since the identity of the informer, in the circumstances of this case, had no real bearing on that charge and is therefore privileged.
9
What is usually referred to as the informer's privilege is in reality the Government's privilege to withhold from disclosure the identity of persons who furnish information of violations of law to officers charged with enforcement of that law. Scher v. United States, 305 U.S. 251, 254, 59 S.Ct. 174, 176, 83 L.Ed. 151; In re Quarles and Butler, 158 U.S. 532, 15 S.Ct. 959, 39 L.Ed. 1080; Vogel v. Gruaz, 110 U.S. 311, 316, 4 S.Ct. 12, 14, 28 L.Ed. 158. The purpose of the privilege is the furtherance and protection of the public interest in effective law enforcement. The privilege recognizes the obligation of citizens to communicate their knowledge of the commission of crimes to law-enforcement officials and, by preserving their anonymity, encourages them to perform that obligation.
10
The scope of the privilege is limited by its underlying purpose. Thus, where the disclosure of the contents of a communication will not tend to reveal the identity of an informer, the contents are not privileged.7 Likewise, once the identity of the informer has been disclosed to those who would have cause to resent the communication, the privilege is no longer applicable.8
11
A further limitation on the applicability of the privilege arises from the fundamental requirements of fairness. Where the disclosure of an informer's identity, or of the contents of his communication, is relevant and helpful to the defense of an accused, or is essential to a fair determination of a cause, the privilege must give way.9 In these situations the trial court may require disclosure and, if the Government withholds the information, dismiss the action.10 Most of the federal cases involving this limitation on the scope of the informer's privilege have arisen where the legality of a search without a warrant is in issue and the communications of an informer are claimed to establish probable cause. In these cases the Government has been required to disclose the identity of the informant unless there was sufficient evidence apart from his confidential communication.11
12
Three recent cases in the Courts of Appeals have involved the identical problem raised here—the Government's right to withhold the identity of an informer who helped to set up the commission of the crime and who was present at its occurrence. Portomene v. United States, 5 Cir., 221 F.2d 582; United States v. Conforti, 7 Cir., 200 F.2d 365; Sorrentino v. United States, 9 Cir., 163 F.2d 627. In each case it was stated that the identity of such an informer must be disclosed whenever the informer's testimony may be relevant and helpful to the accused's defense.12
13
We believe that no fixed rule with respect to disclosure is justifiable. The problem is one that calls for balancing the public interest in protecting the flow of information against the individual's right to prepare his defense. Whether a proper balance renders nondisclosure erroneous must depend on the particular circumstances of each case, taking into consideration the crime charged, the possible defenses, the possible significance of the informer's testimony, and other relevant factors.
II.
14
The materiality of John Doe's possible testimony must be determined by reference to the offense charged in Count 2 and the evidence relating to that count. The charge is in the language of the statute. It does not charge mere possession; it charges that petitioner did 'fraudulently and knowingly receive, conceal, buy and facilitate the transportation and concealment after importation of * * * heroin, knowing the same to be imported into the United States contrary to law. * * *' While John Doe is not expressly mentioned, this charge, when viewed in connection with the evidence introduced at the trial, is so closely related to John Doe as to make his identity and testimony highly material.
15
It is true that the last sentence of subdivision (c) of § 2 authorizes a conviction when the Government has proved that the accused possessed narcotics, unless the accused explains or justifies such possession.13 But this statutory presumption does not reduce the offense to one of mere possession or shift the burden of proof; it merely places on the accused, at a certain point, the burden of going forward with his defense.14 The fact that petitioner here was faced with the burden of explaining or justifying his alleged possession of the heroin emphasizea his vital need for access to any material witness. Otherwise, the burden of going forward might become unduly heavy.
16
The circumstances of this case demonstrate that John Doe's possible testimony was highly relevant and might have been helpful to the defense. So far as petitioner knew, he and John Doe were alone and unobserved during the crucial occurrence for which he was indicted. Unless petitioner waived his constitutional right not to take the stand in his own defense, John Doe was his one material witness. Petitioner's opportunity to cross-examine Police Officer Bryson and Federal Narcotics Agent Durham was hardly a substitute for an opportunity to examine the man who had been nearest to him and took part in the transaction. Doe had helped to set up the criminal occurrence and had played a prominent part in it. His testimony might have disclosed an entrapment. He might have thrown doubt upon petitioner's identity or on the identity of the package. He was the only witness who might have testified to petitioner's possible lack of knowledge of the contents of the package that he 'transported' from the tree to John Doe's car. The desirability of calling John Doe as a witness, or at least interviewing him in preparation for trial, was a matter for the accused rather than the Government to decide.
17
Finally, the Government's use against petitioner of his conversation with John Doe while riding in Doe's car particularly emphasizes the unfairness of the nondisclosure in this case. The only person, other than petitioner himself, who could controvert, emplain or amplify Bryson's report of this important conversation was John Doe. Contradiction or amplification might have borne upon petitioner's knowledge of the contents of the package or might have tended to show an entrapment.
18
This is a case where the Government's informer was the sole participant, other than the accused, in the transaction charged. The informer was the only witness in a position to amplify or contradict the testimony of government witnesses. Moreover, a government witness testified that Doe denied knowing petitioner or ever having seen him before. We conclude that, under these circumstances, the trial court committed prejudicial error in permitting the Government to withhold the identity of its undercover employee in the face of repeated demands by the accused for his disclosure.15
19
Petitioner also presents a claim of error arising out of a controversy over the correctness of an entry, made on the envelope containing the heroin, to the effect that the heroin had been found by Bryson. The undisputed testimony of the officers was that the heroin had been found by Durham and handed by him to Bryson who, in turn, handed it to Fields who made the erroneous entry. On the basis of this discrepancy, petitioner sought to obtain Durham's written report to the Federal Narcotics Bureau concerning the case. Although this discrepancy dealt with the relatively minor matter of who had first found the package, it also reflected upon the credibility of Durham and Fields, two of the Government's principal witnesses. However, in view of the decision we have reached on other grounds, we deem it unnecessary to determine whether the denial of this request, even if erroneous, was prejudicial to petitioner.
20
The judgment of the Court of Appeals is reversed and the case is remanded to the District Court for proceedings not inconsistent with this opinion.
21
Reversed and remanded.
22
Mr. Justice BLACK and Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
23
Mr. Justice CLARK, dissenting.
24
It is with regret that I dissent from the opinion of the Court, not because I am alone, but for the reason that I have been unable to convince the majority of the unsoundness of its conclusion on the facts here and the destructive effect which that conclusion will have on the enforcement of the narcotic laws. The short of it is that the conviction of a self-confessed dope peddler is reversed because the Government refused to furnish the name of its informant whose identity the undisputed evidence indicated was well known to the peddler. Yet the Court reverses on the ground of 'unfairness' because of the Government's failure to perform this fruitless gesture. In my view this does violence to the common understanding of what is fair and just.
25
First, it is well to remember that the illegal traffic in narcotic drugs poses a most serious social problem. One need only read the newspapers to gauge its enormity. No crime leads more directly to the commission of other offenses. Moreover, it is a most difficult crime to detect and prove. Because drugs come in small pills or powder and are readily packaged in capsules or glassine containers, they may be easily concealed. They can be carried on the person or even in the body crevasses where detection is almost impossible. Enforcement is, therefore, most difficult without the use of 'stool pigeons' or informants. Their use has long had the approval of the courts. To give them protection governments have always followed a policy of nondisclosure of teir identities. Experience teaches that once this policy is relaxed—even though the informant be dead—its effectiveness is destroyed. Once an informant is known the drug traffickers are quick to retaliate. Dead men tell no tales. The old penalty of tongue removal, once visited upon the informer Larunda, has been found obsolete.
26
Of course where enforcement of a non-disclosure policy deprives an accused of a fair trial it must either be relaxed or the prosecution must be foregone. The Government is fully aware of this dilemma and solves it every day by foregoing prosecutions in many cases where evidence essential to the defense would require disclosure. But this is not such a case.
27
In note 8 of the majority opinion, supra, the Court makes much of testimony of a police officer that the informant, while at the police station, 'denied knowing, or ever having seen, petitioner.' I submit that this testimony is taken out of its proper setting. The informant was in custody when petitioner was arrested and the two were taken to the police station where each was kept in custody overnight. There, while in custody, they were interrogated together about the occurrences leading up to the arrests. The federal officer present at the time was questioned at the trial in regard to informant's answers at the station:
28
'Q. As a matter of fact, (the informant) said he did not have a transaction with him, didn't he, in Roviaro's presence? A. Do you want the entire conversation?
29
'Q. Isn't what I asked you a fact? A. No, sir. He didn't deny it.
30
'Q. Didn't (the informant) say he didn't even know him? A. Yes, sir; at first he did.'1
31
In proper context this merely shows that the informant was carrying out a pretense that he too was arrested, was involved, and was not 'squealing.' In fact, officer Bryson attempted in his testimony to explain the 'purpose' of the informant in so answering but was prevented by petitioner's counsel.
32
Moreover, the uncontradicted evidence is that the petitioner knew the informant and had associated with him for some time. Two officers testified that they had seen petitioner on June 22, 1954, enter the informant's car on Michigan Avenue in Chicago. Another saw informant and petitioner enter the latter's home together on June 28, only six weeks prior to the events in question here. Further testimony shows that the informant was indebted to the petitioner, that the petitioner had telephoned several times to informant's home and 'at the place,' that petitioner was going to call again in a couple of days after the date of his arrest, and that he entered informant's car on the night of the arrest and drove around with him for several miles. The Court asserts that the conversation between the informant and petitioner while on this ride 'emphasizes the unfairness of the nondisclosure in this case.' But if we limit the officer's testimony to the statements of petitioner alone, the testimony would prove the intimacy of the acquaintance between petitioner and the informant. It would show that petitioner directed the informant to the cache and admonished him to turn out the car lights because of a 'tail'; that petitioner knew how to reach informant by telephone and had tried to phone him; that he had brought him 'three pieces this time,' indicating prior sales; that informant was indebted to him; that when they approached the cache he directed the informant to stop the car; and that finally when he returned with the narcotics, petitioner said 'Here it is, I'll call you in a couple of days.' All of this testimony was admissiable against petitioner whether the informant was available or not or whether the was dead or alive. It proves beyond question that the two were closely acquainted. For the Court to conclude in the face of such a record that petitioner did not know the informant is to me fantastic.
33
But this is not all. The petitioner has not mentioned a single substantial ground essential to his defense which would make it necessary for the Government to name the informer. The Court mentions that there might have been entrapment. Petitioner not only failed to claim entrapment but his counsel appears to have rejected any suggestion of it in open court. I submit the Court should not raise it for him here. It should be noted that petitioner's counsel stated in open court that petitioner knew the informant and believed he was dead.2 Were there necessity to establish informant's identity or, if dead, his death, petitioner could easily have done so.3
34
In truth, it appears that petitioner hoped that the Government would not furnish the name for, if the informant was dead as he believed, petitioner's ground was cut from under him. If the informant was living he knew that even though his testimony was favorable it would not be sufficient to overcome the presumption of the statute. In fact, a casual reading of the record paints a piecture of one vainly engaging in trial tactics rather than searching for real defenses—shadowboxing with the prosecution in a baseless attempt to get a name that he already had but in reality hoping to get a reversible error that was nowhere else in sight. We should not encourage such tactics.
35
In light of these facts the rule announced by the Court in note 8 of the opinion should be applied, i.e., that the trial 'court's failure to require disclosure would not be prejudicial even if erroneous. See Sorrentino v. United States, 9 Cir., 163 F.2d 627.'
36
The position of the Court is that since the trial judge made no finding that petitioner knew the informant, the Government cannot successfully assert harmless error. It is true that the Court made no finding other than that of guilt. But this general finding is entitled to the support of every reasonable presumption. It would be reasonable to assume that the trial judge declined to order the disclosure because petitioner's counsel had said in open court that he knew the identity of the informant. Furthermore, petitioner has made no showing of how he was harmed by the nondisclosure—indeed he introduced no evidence of anything.
37
I come now to the necessary proof required for a finding of guilt under Count 2. All that is necessary here is proof of possession of unstamped narcotics, such as heroin. The direct, uncontroverted evidence of possession, as well as transportation, is in the record. Two officers, one a local policeman and the other a regular federal narcotics agent, saw petitioner when he had in his hand a pckage containing heroin. The package was unstamped. A third officer saw petitioner leave the scene of his crime, get into his car, and ride away. The identification by each of the three is positive and stands uncontradicted. Under the Narcotic Drugs Act, 65 Stat. 767, 21 U.S.C. § 174, 21 U.S.C.A. § 174, this alone is prima facie evidence of guilt. Petitioner did not rebut it. In this connection it is well to point out petitioner's statement soon after his arrest. The officers asked him: 'Are you going to take this (rap) by yourself or are you going to name your connection?' Petitioner replied that they were wasting their time—'There's no use asking me about anybody else. * * * I don't want to get anybody else in trouble. You got me. I've stood up twice before and I can stand up again. Besides that, you've got to convict me anyhow.' (Emphasis added.) In view of this, I submit that there is no question of guilt involved here.
38
Feeling as I do that the opinion of the Court seriously jeopardizes the privilege of the Government in cases involving informers, that their use in narcotic cases is an absolute necessity in the proper administration of the narcotic laws, and that the disclosure required here today is not only unessential to the petitioner's defense but on the other hand undermines a long-standing policy necessary to the successful enforcement of the narcotic laws, I respectfully dissent.
1
'(c) Whoever fraudulently or knowingly imports or brings any narcotic drug into the United States or any territory under its control or jurisdiction, contrary to law, or receives, conceals, buys, sells, or in any manner facilitates the transportation, concealment, or sale of any such narcotic drug after being imported or brought in, knowing the same to have been imported contrary to law, or conspires to commit any of such acts in violation of the laws of the United States, shall be fined not more than $2,000 and imprisoned not less than two or more than five years. * * *
'Whenever on trial for a violation of this subdivision (§ 2(c)) the defendant is shown to have or to have had possession of the narcotic drug, such possession shall be deemed sufficient evidence to authorize conviction unless the defendant explains the possession to the satisfaction of the jury.' 65 Stat. 767, 768, 21 U.S.C. § 174, 21 U.S.C.A. § 174.
2
The judgment of conviction provided for a $5 fine on 'each' count, to 'run concurrently.' The Government stated, during the argument before this Court, that this judgment has been construed administratively as imposing only one $5 fine. We therefore assume, without so deciding, that the judgment imposed a fully concurrent sentence.
3
Durham, Bryson and Sims, among them, testified that Doe was an 'informer' and a 'special employee' who had been known to the federal agents for several years.
4
Police Officer Bryson testified as follows:
'Q. Well, did he (John Doe) say anything with reference to an acquaintanceship or any prior association with this man (petitioner) or any transaction with this man?
'A. Well, he said he didn't know the Defendant here. He said he had never seen him before.'
5
The following colloquy occurred between Chester E. Emanuelson, the government counsel, and Maurice J. Walsh, petitioner's counsel:
'Mr. Emanuelson: * * *
'The reason we do not want to reveal his (Doe's) name is that there are other matters that are pending. I have been told—I know of one myself—and the cases hold that we do not have to reveal the former's name. Now, if there is some reason—
'Mr. Walsh: Well, is there any activity of the informer which will be curtailed by reason of the disclosure of his name? Would you answer that?
'Mr. Emanuelson: Any activities?
'Mr. Walsh: Yes.
'Mr. Emanuelson: From this point forward, no.
'Mr. Walsh: Is there any occasion upon which he will be called to testify?
'Mr. Emanuelson: No.'
In a later colloquy Mr. Emanue'son stated: '(A)s I understand it, the reason his (Doe's) name has not been disclosed is because he is acting as a Government employee in other cases and it would help other persons in other matters that are pending.'
6
Since the concurrent sentence did not exceed that which lawfully might be imposed under a single count, the judgment may be affirmed if the conviction on either count is valid. Pinkerton v. United States, 328 U.S. 640, 641—642, n. 1, 66 S.Ct. 1180, 1181, 90 L.Ed. 1489; Hirabayashi v. United States, 320 U.S. 81, 85, 63 S.Ct. 1375, 1378, 87 L.Ed. 1774; Abrams v. United States, 250 U.S. 616, 619, 40 S.Ct. 17, 18, 63 L.Ed. 1173; Claassen v. United States, 142 U.S. 140, 146—147, 12 S.Ct. 169, 170, 35 L.Ed. 966.
7
Foltz v. Moore McCormack Lines, 189 F.2d 537, 539—540; VIII Wigmore, Evidence (3d ed. 1940), § 2374(1); A.L.I., Model Code of Evidence (1942), Rule 230. But cf. In re Quarles and Batler, 158 U.S. 532. 15 S.Ct. 959, 39 L.Ed. 1080; Vogel v. Gruaz, 110 U.S. 311, 316, 4 S.Ct. 12, 14, 28 L.Ed. 158.
8
Sorrentino v. United States, 9 Cir., 163 F.2d 627, 629; Pihl v. Morris, 319 Mass. 577, 578—580, 66 N.E.2d 804, 805—806; Commonwealth v. Congdon, 265 Mass. 166, 174—175, 165 N.E. 467, 470; Regina v. Candy, cited 15 M. & W. 175; VIII Wigmore, Evidence (3d ed. 1940), § 2374(2).
The record contains several intimations that the identity of John Doe was known to petitioner and that John Doe died prior to the trial. In either situation, whatever privilege the Government might have had would have ceased to exist, since the purpose of the privilege is to maintain the Government's channels of communication by shielding the identity of an informer from those who would have cause to resent his conduct. The Government suggests that if petitioner knew John Doe's identity, the court's failure to require disclosure would not be prejudicial even if erroneous. See Sorrentino v. United States, 9 Cir., 163 F.2d 627. However, any indications that petitioner, at the time of the trial, was aware of John Doe's identity are contradicted by the testimony of Officer Bryson that John Doe at police headquarters denied knowing, or ever having seen, petitioner. The trial court made no factual finding that petitioner knew Doe's identity. On this record we cannot assume that John Doe was known to petitioner, and, if alive, available to him as a witness. Nor can we conclude that John Doe died before the trial.
9
See, e.g., Scher v. United States, 305 U.S. 251, 59 S.Ct. 174, 83 L.Ed. 151; Wilson v. United States, 3 Cir., 59 F.2d 390; Centoamore v. State, 105 Neb. 452, 181 N.W. 182. Early decisions established that the scope of the privilege was in the discretion of the trial judge. Disclosure was compelled when he found it 'material to the ends of justice. * * *' Regina v. Richardson, 3 F. & F. 693, 694 (1863). See also, Marks v. Beyfus, L.R. 25 Q.B.D. 494, 498 (1890). In the Scher case, supra, 305 U.S. at page 254, 59 S.Ct. at page 176, this Court said that 'public policy forbids disclosure of an informer's identity unless essential to the defense, as, for example, where this turns upon an officer's good faith.'
10
See United States v. Coplon, 2 Cir., 185 F.2d 629, 638; United States v. Andolschek, 2 Cir., 142 F.2d 503, 506.
11
E.g., Scher v. United States, supra; United States v. Li Fat Tong., 2 Cir., 152 F.2d 650; Wilson v. United States, supra; United States v. Keown, D.C., 19 F.Supp. 639.
12
In the Portomene case, supra, the accused was charged with two sales of narcotics to an informer. The accused took the stand, denied selling narcotics, and testified that the person he believed to be the informer had a grudge against him. The Fifth Circuit held that disclosure was essential to the defense.
In the Conforti case, supra, the accused was charged with possession of counterfeit notes. Agents overheard the informer make arrangements with the accused, saw the informer meet the accused and a package transferred, and then received from the informer a package containing counterfeit money. The Seventh Circuit stated that the accused would have been entitled to disclosure of the informer's identity if a proper demand had been made at the trial.
In the Sorrentino case, supra, the accused was charged with both sale and possession of narcotics. Government agents saw the accused go into a house with the informer after arrangements for a sale had been overheard, and the informer later turned over narcotics to the agents. The Ninth Circuit stated that the accused was entitled to disclosure under these circumstances, but the conviction was affirmed on the ground that the record demonstrated that the accused knew the identity of the informer.
See also, Crosby v. State, 90 Ga.App. 63, 82 S.E.2d 38.
13
See n. 1, supra, where the material part of the statutory provision is quoted in full.
14
Casey v. United States, 276 U.S. 413, 418, 48 S.Ct. 373, 374, 72 L.Ed. 632; United States v. Chiarelli, 7 Cir., 192 F.2d 528, 531; Stoppelli v. United States, 9 Cir., 183 F.2d 391; Landsborough v. United States, 6 Cir., 168 F.2d 486.
Petitioner contends that the Government in all cases must make a further affirmative showing that the accused knew that its failure to do so here entitles him that its failure to do so here ntitles him to an acquittal. That contention, however, has been decided against petitioner in the cases cited above.
15
Thus far we have dealt largely with the trial court's refusal, at the trial, to require disclosure of the informer's identity. In view of the Government's exclusive reliance here upon Count 2, we have considered this question only with respect to that count. However, we think that the court erred also in denying, prior to the trial, petitioner's motion for a bill of particulars, insofar as it requested John Doe's identity and address. Since Count 1 was then before the court and expressly charged petitioner with a sale of heroin to John Doe, it was evident from the face of the indictment that Doe was a participant in and a material witness to that sale. Accordingly, when his name and address were thus requested, the Government should have been required to supply that information or suffer dismissal of that count.
1
On petitioner's objection this testimony was subsequently stricken. However, police officer Bryson during cross-examination provided substantially this same testimony and the inadvertence of the Government in failing to object permitted it to stand.
2
The record discloses the following colloquy between petitioner's counsel, Mr. Walsh, and the court:
'Mr. Walsh: Your Honor, this is the point, actually: He has testified that John Doe (the informant) was present at 11th and State Street with the Defendant. We know that person, We know that person. That person is dead, as I understand it.
'By Mr. Walsh: (Cross-examination of agent Durham).
'Q. I will ask him if the person as a matter of fact was not Tebbil Holmes?
'Q. Isn't the informer's name, or the person you contend is an informer, who has been mentioned by the prosecutor as an informer—isn't his name Tebbil Holmes?'
3
A death certificate, State File No. 1665, Dist. No. 16.10, on file at the Bureau of Vital Statistics, Cook County Clerk's Office, 130 N. Wells St., Chicago, Illinois, indicates that a Tevell Holmes, Sr., died in Chicago on January 17, 1955.
| 01
|
353 U.S. 87
77 S.Ct. 643
1 L.Ed.2d 676
NATIONAL LABOR RELATIONS BOARD, Petitioner,v.
TRUCK DRIVERS LOCAL UNION NO. 449, INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN and HELPERS of AMERICA, A.F.L.
No. 103.
Argued Jan. 17 and 22, 1957.
Decided April 1, 1957.
[Syllabus from pages 87-88 intentionally omitted]
Mr. Dominick L. Manoli, Washington, D.C., for the petitioner.
Mr. Thomas P. McMahon, Buffalo, N.Y., for the respondent.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
The question presented by this case is whether the nonstruck members of a multi-employer bargaining association committed an unfair labor practice when, during contract negotiations, they temporarily locked out their employees as a defense to a union strike against one of their members which imperiled the employers' common interest in bargaining on a group basis.
2
The National Labor Relations Board determined that resort to the temporary lockout was not an unfair labor practice in the circumstances.1 The Court of Appeals for the Second Circuit reversed.2 This Court granted certiorari3 to consider this important question of the construction of the amended National Labor Relations Act,4 and also to consider an alleged conflict with decisions of Courts of Appeals of other circuits.5
3
Eight employers in the linen supply business in and around Buffalo, New York, comprise the membership of the Linen and Credit Exchange. For approximately 13 years, the Exchange and the respondent Union, representing the truck drivers employed by the members, bargained on a multi-employer basis and negotiated successive collective bargaining agreements signed by the Union and by the eight employers. Sixth days before such an agreement was to expire on April 30, 1953, the Union gave notice of its desire to open negotiations for changes.6
4
The Exchange and the Union began negotiations some time before April 30, but the negotiations carried past that date and were continuing on May 26, 1953, when the Union put into effect a 'whipsawing' plan7 by striking and picketing the plant of one of the Exchange members, Frontier Linen Supply, Inc. The next day, May 27, the remaining seven Exchange members laid off their truck drivers after notifying the Union that the layoff action was taken because of the Frontier strike, advising the Union that the laid-off drivers would be recalled if the Union withdrew its picket line and ended the strike. Negotiations continued without interruption, however, until a week later when agreement was reached upon a new contract which the Exchange members and the Union approved and signed. Thereupon the Frontier strike was ended, the laid-off drivers were recalled, and normal operations were resumed at the plants of all Exchange members.
5
The Union filed with the National Labor Relations Board an unfair labor practice charge against the seven employers, alleging that the temporary lockout interfered with its rights guaranteed by § 7, thereby violating § 8(a) (1) and (3) of the Act.8 A complaint issued, and, after hearing, a trial examiner found the employers guilty of the unfair labor practice charged. The Board overruled the trial examiner, finding that 'the more reasonable inference is that, although not specifically announced by the Union, the strike against the one employer necessarily carried with it an implicit threat of future strike action against any or all of the other members of the Association,' with the 'calculated purpose' of causing 'successive and individual employer capitulations.'9 The Board therefore found that 'in the absence of any independent evidence of antiunion motivation, * * * the Respondent's (sic) action in shutting their plants until termination of the strike at Frontier was defensive and privileged in nature, rather than retaliatory and unlawful.'10 The Board, citing Leonard v. National Labor Relations Board, 9 Cir., 205 F.2d 355, concluded 'that a strike by employees against one employer-member of a multiemployer bargaining unit constitutes a threat of strike action against the other employers, which threat, per se, constitutes the type of economic or operative problem at the plants of the nonstruck employers which legally justifies their resort to a temporary lockout of employees.'11
6
The Court of Appeals agreed 'that the Board reasonably inferred' a threat of strike action against the seven employers because there were 'no peculiar facts concerning the Union's relations with that single member.'12 The Court of Appeals thus implicitly found that the only reason for the strike against Frontier was the refusal of the Exchange to meet the Union's demands. But the court held that a temporary lockout of employees on a 'mere threat of, or in anticipation of, a strike,'13 could be justified only if there were unusual economic hardship, and because 'the stipulated facts show no economic justification for the lockout, * * * the lockout of nonstriking employees constituted an interference with their statutory right to engage in concerted activity in violation of § 8(a)(1) of the Act, and also constituted discrimination in the hire and tenure of employment of the employees because of the Union's action, thereby discouraging membership in the Union in violation of § 8(a)(3) of the Act.'14
7
Although, as the Court of Appeals correctly noted, there is no express provisions in the law either prohibiting or authorizing the lockout, the Act does not make the lockout unlawful per se. Legislative history of the Wagner Act, 49 Stat. 449, indicates that there was no intent to prohibit strikes or lockouts as such.15 The unqualified use of the term 'lock-out' in several sections of the Taft-Hartley Act16 is statutory recognition that there are circumstances in which employers may lawful resort to the lockout as an economic weapon. This conclusion is supported by the legislative history of the Act.17
8
We are not concerned here with the cases in which the lockout has been held unlawful because designed to frustrate organizational efforts, to destroy or undermine bargaining representation, or to evade the duty to bargain.18 Nor are we called upon to define the limits of the legitimate use of the lockout.19 The narrow question to be decided is whether a temporary lockout may lawfully be used as a defense to a union strike tactic which threatens the destruction of the employers' interest in bargaining on a group basis.
9
The Court of Appeals rejected the preservation of the integrity of the multiemployer bargaining unit as a justification for an employer lockout.20 The court founded this conclusion upon its interpretation of the Taft-Hartley Act and its legislative history. After stating that '(m)ulti-employer bargaining has never received the express sanction of Congress,' the court reasoned that because at the time of the enactment of the Taft-Hartley Act the Board had never 'gone to the extreme lengths to which it now seeks to go in order to maintain the 'stability of the employer unit," Congress cannot be said to have given legislative approval to the present Board action.21 The court concluded that 'Congress must have intended that such a radical innovation be left open for consideration by the joint committee it set up under § 402 of the Act (29 U.S.C.A. § 192) to study, among other things, 'the methods and procedures for best carrying out the collective-bargaining processes, with special attention to the effects of industrywide or regional bargaining upon the national economy."22
10
We cannot subscribe to this interpretation. Multi-employer bargaining long antedated the Wagner Act, both in industries like the garment industry, characterized by numerous employers of small work forces, and in industries like longshoring and building construction, where workers change employers from day to day or week to week. This basis of bargaining has had its greatest expansion since enactment of the Wagner Act because employers have sought through group bargaining to match increased union strength.23 Approximately four million employees are now governed by collective bargaining agreements signed by unions with thousands of employer associations.24 At the time of the debates on the Taft-Hartley amendments, proposals were made to limit or outlaw multi-employer bargaining. These proposals failed of enactment. They were met with a storm of protest that their adoption would tend to weaken and not strengthen the process of collective bargaining and would conflict with the national labor policy of promoting industrial peace through effective collective bargaining.25
11
The debates over the proposals demonstrate that Congress refused to interfere with such bargaining because there was cogent evidence that in many industries the multi-employer bargaining basis was a vital factor in the effectuation of the national policy of promoting labor peace through strengthened collective bargaining. The inaction of Congress with respect to multi-employer bargaining cannot be said to indicate an intention to leave the resolution of this problem to future legislation. Rather, the compelling conclusion is that Congress intended 'that the Board should continue its established administrative practice of certifying multi-employer units, and intended to leave to the Board's specialized judgment the inevitable questions concerning multi-employer bargaining bound to arise in the future.'26
12
Although the Act protects the right of the employees to strike in support of their demands, this protection is not so absolute as to deny self-help by employers when legitimate interests of employees and employers collide.27 Conflict may arise, for example, between the right to strike and the interest of small employers in preserving multi-employer bargaining as a means of bargaining on an equal basis with a large union and avoiding the competitive disadvantages resulting from nonuniform contractual terms. The ultimate problem is the balancing of the conflicting legitimate interests. The function of striking that balance to effectuate national labor policy is often a difficult and delicate responsibility, which the Congress committed primarily to the National Labor Relations Board, subject to limited judicial review.28
13
The Court of Appeals recognized that the National Labor Relations Board has legitimately balanced conflicting interests by permitting lockouts where economic hardship was shown.29 The court erred, however, in too narrowly confining the exercise of Board discretion to the cases of economic hardship. We hold that in the circumstances of this case the Board correctly balanced the conflicting interests in deciding that a temporary lockout to preserve the multiemployer bargaining basis from the disintegration threatened by the Union's strike action was lawful.
14
Reversed.
15
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
1
109 N.L.R.B. 447.
2
231 F.2d 110.
3
352 U.S. 818, 77 S.Ct. 36, 1 L.Ed.2d 44.
4
61 Stat. 136, 29 U.S.C. § 141 et seq., 29 U.S.C.A. § 141 et seq.
5
National Labor Relations Board v. Continental Baking Co., 8 Cir., 221 F.2d 427; National Labor Relations Board v. Spalding Avery Lumber Co., 8 Cir., 220 F.2d 673; Leonard v. National Labor Relations Board, 9 Cir., 197 F.2d 435; Id., 9 Cir., 205 F.2d 355; Morand Bros. Beverage Co. v. National Labor Relations Board, 7 Cir., 190 F.2d 576.
6
The contract contained an automatic renewal clause requiring notice of a desire to change the contract to be given 60 odays before the expiration date. The notice was also in conformity with § 8(d) of the Act. 61 Stat. 140, 29 U.S.C. § 158, 29 U.S.C.A. § 158.
7
'Whipsawing' is the process of striking one at a time the employer members of a multi-employer association.
8
Section 7 provides in pertinent part:
'Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection * * *.' 61 Stat. 140, 29 U.S.C. § 157, 29 U.S.C.A. § 157.
Section 8 provides in pertinent part:
'(a) It shall be an unfair labor practice for an employer—
'(1) to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 7;
'(3) by discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization * * *.' 61 Stat. 140, 29 U.S.C. § 158, 29 U.S.C.A. § 158.
9
109 N.L.R.B., at 448.
10
109 N.L.R.B., at 448. The Board relied upon the decision of the Court of Appeals for the Ninth Circuit in Leonard v. National Labor Relations Board, 205 F.2d 355, 357—358, wherein the court stated: '* * * the right of the employers to lock out temporarily all the employees is no more than equal to the right of the union of all the employees to call out the employees of one after another of the * * * (employers) in the whipsawing manner * * *.'
11
109 N.L.R.B., at pp. 448—449.
12
231 F.2d at page 112.
13
Id., at page 113.
14
231 F.2d at page 118.
15
See, e.g., explanation of the bill by Senator Walsh, Chairman of the Senate Committee on Education and Labor, 79 Cong.Rec. 7673.
16
61 Stat. 140, 29 U.S.C. § 157(d)(4), 29 U.S.C.A. § 158(d)(4) (no resort to 'strike or lock-out' during 60-day notice period); 61 Stat. 153, 29 U.S.C. § 173(c), 29 U.S.C.A. § 173(c) (Director of Mediation Service to seek to induce parties to settle dispute peacefully 'without resort to strike, lock-out, or other coercion'); 61 Stat. 155, 29 U.S.C. § 176, 29 U.S.C.A. § 176 (appointment of board of inquiry by President when 'threatened or actual strike or lock-out' creates a national emergency); 61 Stat. 155, 29 U.S.C. § 178, 29 U.S.C.A. § 178 (power to enjoin 'strike or lock-out' in case of national emergency).
17
H.R.Rep. No. 245, 80th Cong., 1st Sess. 21—22, 70, 82; S.Rep. No. 105, 80th Cong., 1st Sess. 24; S.Rep. No. 105, pt. 2, 80th Cong., 1st Sess. 21; H.R.Conf.Rep. No. 510, 80th Cong., 1st Sess. 34—35. See also, e.g., 93 Cong.Rec. 1827—1828, 3835.
18
E.g., National Labor Relations Board v. Wallick, 3 Cir., 198 F.2d 477; National Labor Relations Board v. Somerset Classics, Inc., 2 Cir., 193 F.2d 613; Olin Industries, Inc., Winchester Repeating Arms Co. Division v. National Labor Relations Board, 5 Cir., 191 F.2d 613; cf. Associated Press v. National Labor Relations Board, 301 U.S. 103, 57 S.Ct. 650, 81 L.Ed. 953.
19
We thus find it unnecessary to pass upon the question whether, as a general proposition, the employer lockout is the corllary of the employees' statutory right to strike.
20
As previously noted, the Board decision is based in part on a finding that the preservation of employer solidarity justifies a lockout as a defense to a whipsaw strike.
21
231 F.2d at pages 117—118.
22
231 F.2d at page 118.
The opinion of the Court of Appeals may be interpreted as rejecting employer solidarity as a justification for a lockout on the ground that the Union strike constituted a withdrawal by the Union from the multi-employer bargaining unit. The Court of Appeals vigorously argued that a union should be accorded the same freedom of voluntary withdrawal from a multi-employer bargaining unit as the Board has accorded to individual employers. But that question is not presented by this case, and we expressly reserve decision until it is properly before us. The facts here clearly show that the Union strike was not an attempt to withdraw from the multi-employer bargaining unit. On the contrary, the Union continued to carry on negotiations with the Exchange until as agreement was reached and signed.
23
Bahrs, The San Francisco Employers' Council; Chamberlain, Collective Bargaining, 178—179, 180, 182; Freidin, The Taft-Hartley Act and Multi-Employer Bargaining, 4—5; Garrett and Tripp, Management Problems Implicit In Multi-Employer Bargaining, 2—3; Kerr and Randall, Collective Bargaining in the Pacific Coast Pulp and Paper Industry, 3—4; Pierson, Multi-Employer Bargaining, 35—36; Wolman, Industry-Wide Bargaining.
24
79 Monthly Labor Review 805 (1956).
Based on collective bargaining agreements on file with the Bureau of Labor Statistics in 1951, approximately 80% of the unionized employees in the laundry industry were represented under multiemployer employer bargaining. B.L.S.Rep. No. 1 (1953), Collective Bargaining Structures: The Employer Bargaining Unit, 10.
25
Hearings before Senate Committee on Labor and Public Welfare on S. 55 et al., 80th Cong., 1st Sess. 427—428, 1012—1017, 1032—1037, 1055—1057, 1162—1165, 2018—2019, 2370—2371; S.Rep. No. 105, pt. 2, 80th Cong., 1st Sess. 6—8; Hearings before House Committee on Education and Labor on H.R. 8 et al., 80th Cong., 1st Sess. 552—553, 1552—1554, 3024—3026; 93 Cong.Rec. 1834—1844, 4030 4031, 4443—4444, 4581—4587, 4674—4676.
26
231 F.2d at page 121 (dissenting opinion).
27
National Labor Relations Board v. Mackay Radio & Telegraph Co., 304 U.S. 333, 58 S.Ct. 904, 82 L.Ed. 1381; National Labor Relations Board v. Continental Baking Co., 8 Cir., 221 F.2d 427; National Labor Relations Board v. Spalding Avery Lumber Co., 8 Cir., 220 F.2d 673; Leonard v. National Labor Relations Board, 9 Cir., 197 F.2d 435; Id., 9 Cir., 205 F.2d 355; Morand Bros. Beverage Co. v. National Labor Relations Board, 7 Cir., 190 F.2d 576; Betts Cadillac Olds, Inc., 96 N.L.R.B. 268; International Shoe Co., 93 N.L.R.B. 907; Duluth Bottling Association, 48 N.L.R.B. 1335.
28
National Labor Relations Board v. Babcock & Wilcox Co., 351 U.S. 105, 76 S.Ct. 679, 100 L.Ed. 975; Republic Aviation Corp. v. National Labor Relations Board, 324 U.S. 793, 65 S.Ct. 982, 89 L.Ed. 1372; Phelps Dodge Corp. v. National Labor Relations Board, 313 U.S. 177, 61 S.Ct. 845, 85 L.Ed. 1271.
In Phelps Dodge, the Court said:
'* * * There is an area plainly covered by the language of the Act and an area no less plainly without it. But in the nature of things Congress could not catalogue all the devices and stratagems for circumventing the policies of the Act. Nor could it define the whole gamut of remedies to effectuate these policies in an infinite variety of specific situations. Congress met these difficulties by leaving the adaptation of means to end to the empiric process of administration. The exercise of the process was committed to the Board, subject to limited judicial review. Because the relation of remedy to policy is peculiarly a matter for administrative competence, courts must not enter the allowable area of the Board's discretion and must guard against the danger of sliding unconsciously from the narrow confines of law into the more spacious domain of policy. On the other hand, the power with which Congress invested the Board implies responsibility—the responsibility of exercising its judgment in employing the statutory powers.' 313 U.S. at page 194, 61 S.Ct. at page 852.
29
Betts Cadillace Olds, Inc., 96 N.L.R.B. 268; International Shoe Co., 93 N.L.R.B. 907; Duluth Bottling Association, 48 N.L.R.B. 1335.
| 67
|
353 U.S. 98
77 S.Ct. 652
1 L.Ed.2d 683
UNITED STATES of America, Petitioner,v.The OHIO POWER COMPANY.
No. 312.
Decided April 1, 1957.
PER CURIAM.
1
On June 11, 1956, we unanimously vacated sua sponte our order of December 5, 1955, 350 U.S. 919, 76 S.Ct. 192, 100 L.Ed. 805, denying the timely petition for rehearing in this case, 351 U.S. 980, 76 S.Ct. 1044, 100 L.Ed. 1495, so that this case might be disposed of consistently with the companion cases of United States v. Allen-Bradley Co., 352 U.S. 306, 77 S.Ct. 343, 1 L.Ed.2d 347, and National Lead Co. v. Commissioner, 352 U.S. 313, 77 S.Ct. 347, 1 L.Ed.2d 352, in which we had granted certiorari the same day, viz. June 11, 1956. 351 U.S. 981, 76 S.Ct. 1052, 100 L.Ed. 1496. If there is to be uniformity in the application of the principles announced in those two companion cases, the judgment below in the instant case cannot stand. Accordingly we now grant the petition for rehearing, vacate the order denying certiorari, grant the petition for certiorari, and reverse the judgment of the Court of Claims on the authority of United States v. Allen-Bradley Co., supra, and National Lead Co. v. Commissioner, supra.
2
We have consistently ruled that the interest in finality of litigation must yield where the interests of justice would make unfair the strict application of our rules. This policy finds expression in the manner in which we have exercised our power over our own judgments, both in civil and criminal cases. Clark v. Manufacturers Trust Co., 337 U.S. 953, 69 S.Ct. 1525, 93 L.Ed. 1754; Goldbaum v. United States, 347 U.S. 1007, 74 S.Ct. 861, 98 L.Ed. 1132; Banks v. United States, 347 U.S. 1007, 74 S.Ct. 861, 98 L.Ed. 1132; McFee v. United States, 347 U.S. 1007, 74 S.Ct. 862, 98 L.Ed. 1132; Remmer v. United States, 348 U.S. 904, 75 S.Ct. 288, 99 L.Ed. 710; State of Florida ex rel. Hawkins v. Board of Control, 350 U.S. 413, 76 S.Ct. 464, 100 L.Ed. 486; Boudoin v. Lykes Bros. S.S. Co., 350 U.S. 811, 76 S.Ct. 38, 100 L.Ed. 727; Cahill v. New York, N.H. & H.R. Co., 351 U.S. 183, 76 S.Ct. 758, 100 L.Ed. 1075; Achilli v. United States, 352 U.S. 1023, 77 S.Ct. 588.
3
Reversed.
4
Mr. Justice BRENNAN and Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
5
Mr. Justice HARLAN, whom Mr. Justice FRANKFURTER and Mr. Justice BURTON join, dissenting.
6
The Court's action in overturning the judgment of the Court of Claims in this case, nearly a year and a half after we denied certiorari, and despite the subsequent denial of two successive petitions for rehearing, is so disturbing a departure from what I conceive to be sound procedure that I am constrained to dissent.
7
This is a tax case involving the right of the War Production Board to certify that only part of the actual cost of wartime facilities, constructed by a taxpayer at the instance of the Government, was necessary in the national defense and hence subject to accelerated amortization under § 124(f) of the Internal Revenue Code of 1939.1 Claiming that the War Production Board had no power to certify less than the full cost of such facilities, the Ohio Power Company sued the Government in the Court of Claims to recover an alleged overpayment of taxes, asserting that it was entitled to accelerated amortization of the full cost of wartime facilities which it had constructed, and not merely of that part of the cost which the War Production Board had certified as necessary in the interest of national defense. The Court of Claims, sustaining this contention, entered judgment in favor of the taxpayer on March 1, 1955.2
8
On August 12, 1955, the Government petitioned for certiorari, its time for filing having been duly extended. We denied the petition on October 17, 1955. 350 U.S. 862, 76 S.Ct. 104, 100 L.Ed. 765. On November 10, 1955, the Government filed a timely petition for rehearing, requesting that its consideration be deferred until the case of Commissioner of Internal Revenue v. National Lead Co.,3 involving this same tax question, had been decided by the Court of Appeals for the Second Circuit. We denied this petition on December 5, 1955. 350 U.S. 919, 76 S.Ct. 192, 100 L.Ed. 805. On February 14, 1956, the Court of Appeals decided National Lead in favor of the Government,4 and on April 3, 1956, the Court of Claims, in Allen-Bradley Co. v. United States,5 decided the same tax question favorable to the taxpayer, as it had already done in the Ohio Power case. This, then, provided the Government with the 'conflict' which had been lacking at the time when the Court denied its petition for certiorari in the present case. On this basis the Government, on May 3, 1956, petitioned for certiorari in Allen-Bradley,6 and at the same time petitioned for leave to file a second petition for rehearing in the Ohio Power case. On May 28, 1956, the Court denied that petition because it was both long out of time and 'consecutive,'7 351 U.S. 958, 76 S.Ct. 844, 100 L.Ed. 1480, and thus for the third time refused to take the case. Nevertheless, two weeks thereafter, on June 11, 1956, the Court, incident to its grants of certiorari in the Allen-Bradley and National Lead cases, vacated sua sponte its order of December 5, 1955 denying the Government's original timely petition for rehearing in the Ohio Power case. 351 U.S. 980, 76 S.Ct. 1044, 100 L.Ed. 1495. And today the Court grants that petition, some 16 months after it had originally been denied, and reverses the Court of Claims' judgment in favor of the taxpayer.
I.
9
In my opinion, today's order reversing the Court of Claims violates our own Rules. That order is based upon the Court's order of June 11, 1956, which vacated the order of December 5, 1955 denying the Government's first petition for rehearing of the denial of certiorari. This June 11 order thus purported to continue consideration of the original petition for rehearing, which is now granted. Under our Rules, I think the order of June 11 was improvidently issued.8 Had the Government, just prior to June 11, 1956, petitioned to vacate the order of December 5, 1955, the petition would have violated Rule 58 of our Revised Rules, whether considered as, in effect, a petition for rehearing of that order, in which case it would have been out of time, or as a petition for rehearing of the original denial of certiorari, in which case it would have been both out of time and 'consecutive.'9 To say that the order of June 11 could escape Rule 58 because it was made on the Court's initiative seems to me to involve the most hypertechnical sort of reasoning.
10
If we are to follow our Rules the order of June 11, and with it today's order, must fall, for this litigation must be considered to have been closed on December 5, 1955, when the Court denied the Government's first petition for rehearing.
II.
11
Rule 58, by marking the end of a case in this Court, is intended to further the law's deep-rooted policy that adjudication must at some time become final. I think we should follow it. Prior to 1948, the outside limit of rules of finality in the federal courts was the end of the term, because, except for the extraordinary writs, federal courts were considered to have no power to deal with their judgments after the end of the term at which they were rendered. Bronson v. Schulten, 104 U.S. 410, 415, 26 L.Ed. 797. In 1948 Congress abolished the 'end of term' rule by a statute, 28 U.S.C. § 452, 28 U.S.C.A. § 452,10 which was expressly made applicable to this Court. 28 U.S.C. § 451, 28 U.S.C.A. § 451. The effect of § 452 was to leave the federal courts untrammeled in establishing their own rules of finality. But the history of § 452 indicates that the courts were to have no power to re-examine their judgments otherwise than in accordance with their established rules or statutes. Section 452 was modeled on Rule 6(c) of the Federal Rules of Civil Procedure, 28 U.S.C.A.11 See the Reviser's Note to § 452, 28 U.S.C., p. 4142, 28 U.S.C.A. p. 463. As originally promulgated in 1938, Rule 6(c) had referred only to the 'expiration of a term' and not to its 'continued existence.' In 1944 this Court held that a District Court had inherent power to vacate a judgment and enter a new one, with the effect of extending a party's right to appeal, notwithstanding such action was not authorized by any rule of the District Court, because the term had not yet expired. Hill v. Hawes, 320 U.S. 520, 524, 64 S.Ct. 334, 336, 88 L.Ed. 283. Thereafter, Rule 6(c) was amended to provide that the 'continued existence or expiration' of the term should not affect the power of a court. The purpose was 'to prevent reliance upon the continued existence of a term as a source of power to disturb the finality of a judgment upon grounds other than those stated in these rules.' Advisory Committee on Rules of Civil Procedure, Report of Proposed Amendments to Rules, H.R.Doc. No. 473, 80th Cong., 1st Sess. 50 (1946). The 'continued existence or' language of amended Rule 6(c) was taken bodily into § 452.
12
The history of § 452 thus casts grave doubt, to say the least, on the power of the Court to do what it has done in this case, for its action was certainly not taken 'upon grounds * * * stated in (its) rules.'12 I recognize that § 452 does not prevent the Court from changing its Rules, but if the statute means what its history suggests, such changes should be made on a general and not ad hoc basic, lest cases which are alike be treated differently.13
13
This Court, however, has never faced the problems raised by § 452, but has proceeded on the assumption that the statute does not affect the Court's inherent power over its judgments; in other words, that by resorting to such power the Court may affect judgments by action which would otherwise be out of time under the Rules. If that view be correct, it follows that finality of adjudication in this Court ultimately depends on the Court's self-restraint. That, and the doubtful meaning of § 452, seem to me in any event to argue strongly against departures from Rule 58—the only Rule of finality in this Court—except in rare instances. I now turn to the question of whether this is such a case.
III.
14
The past practice of the Court shows that its inherent powers have always been exercised most sparingly. Thus, prior to enactment of § 452 in 1948, the Court, so far as I can discover, had never in its history departed from the 'end of term' rule by granting a petition for rehearing after the end of the term at which a judgment had been rendered.14 Between 1948 and the effective date of Rule 58 (July 1, 1954), one of whose purposes was to tighten the rules ending litigation in this Court, I can find only four cases in which untimely relief was granted: Clark v. Manufacturers Trust Co., 337 U.S. 953, 69 S.Ct. 1525, 93 L.Ed. 1754, vacated and remanded sub nom. McGrath v. Manufacturers Trust Co., 338 U.S. 241, 70 S.Ct. 4, 94 L.Ed. 31; Goldbaum v. United States, 347 U.S. 1007, 74 S.Ct. 861, 98 L.Ed. 1132; 348 U.S. 905, 75 S.Ct. 311, 99 L.Ed. 710; Banks v. United States, 347 U.S. 1007, 74 S.Ct. 861, 98 L.Ed. 1132; 348 U.S. 905, 75 S.Ct. 311, 99 L.Ed. 710; McFee v. United States, 347 U.S. 1007, 74 S.Ct. 862, 98 L.Ed. 1132; 348 U.S. 905, 75 S.Ct. 311, 99 L.Ed. 710.15 Of these only Clark bears any similarity to this case.16 Goldbaum, Banks and McFee were criminal 'net worth' tax cases in which the Court, sua sponte, restored the cases to the docket pending decision of Holland v. United States, 348 U.S. 121, 75 S.Ct. 127, 99 L.Ed. 150, the cases thereafter being remanded for reconsideration in light of Holland. I need hardly say that the granting of untimely relief in criminal cases presents considerations not found in civil cases.
15
Of particular significance here is what has happened since Rule 58 became effective. From then until today I have discovered but three cases in which the Court has granted rehearing out of time, all involving situations quite dissimilar to that presented here: Remmer v. United States, 348 U.S. 904, 75 S.Ct. 288, 99 L.Ed. 710; McNally v. Teets, 352 U.S. 886, 77 S.Ct. 134, 1 L.Ed.2d 92; Achilli v. United States, 352 U.S. 1023, 77 S.Ct. 588.17 Remmer was a criminal case which had been remanded to the lower court for further proceedings, and where the petition for rehearing raised questions which could again be brought to this Court on certiorari; rehearing thus served to avoid the delay and expense of further intermediate proceedings below, and hardly could be claimed to conflict with the policy of finality. McNally, also a criminal case, simply involved clarification of the Court's earlier order denying certiorari, in order to make clear that it covered two judgments below against the petitioner instead of only one. For lack of such a clarification, the petitioner's application for habeas corpus had been denied by a federal district court on the ground that, having failed to petition for certiorari from one of the two state decisions against him, he had not fully exhausted his state remedies. Achilli presented the same features as Remmer, in that it was a criminal case presenting a question that could again be raised in proceedings below and then brought to this Court in due course on certiorari. Indeed, exactly that happened in the Achilli case: petitioner, not anticipating this Court's willingness to reconsider its original denial of certiorari, raised the same question a second time before the District Court, obtained a new decision, and petitioned successfully for certiorari. 353 U.S. 909, 77 S.Ct. 669. The net effect of the Court's untimely order, therefore, was to bring here more quickly a question that would arrive eventually in any case. Three other cases during this period, though not arising on petition for rehearing, may be considered to have involved out-of-time action by the Court: People of State of Florida ex rel. Hawkins v. Board of Control, 350 U.S. 413, 76 S.Ct. 464, 100 L.Ed. 486; Boudoin v. Lykes Bros. S.S. Co., 350 U.S. 811, 76 S.Ct. 38, 100 L.Ed. 727, and Cahill v. New York, N.H. & H.R. Co., 351 U.S. 183, 76 S.Ct. 758, 100 L.Ed. 1075. All of them, however, involved the correction of errors in the Court's own mandates, and not, as here, the overturning of another court's decision that had long since been permitted to become final.
16
The other side of the coin is also illuminating. I find that since 1948 there have been some 191 untimely applications for rehearing, or the equivalent,18 as against only 10 instances of untimely action, 6 in response to applications and 4 on the Court's initiative. Since the adoption of Rule 58 in 1954, the Court has been asked on 40 occasions to grant rehearing out of time of orders denying certiorari,19 and, with the exception of McNally v. Teets and Achilli v. United States, supra, cases that may fairly be described as unique, and that are certainly unlike this one, each time it has refused. In 13 of the 40 cases, relief was denied despite the claimed development of a conflict. See Fraver v. Studebaker Corp., 348 U.S. 939, 75 S.Ct. 354, 99 L.Ed. 736; Powell v. United States, 348 U.S. 939, 75 S.Ct. 357, 99 L.Ed. 736; Cowles Pub. Co. v. National Labor Relations Board, 348 U.S. 960, 75 S.Ct. 448, 99 L.Ed. 749; Jones v. Lykes Bros. S.S. Co., 348 U.S. 960, 75 S.Ct. 447, 99 L.Ed. 749; Lopiparo v. United States, 349 U.S. 969, 75 S.Ct. 879, 99 L.Ed. 1290; Mondakota Gas Co. v. Montana-Dakota Utilities Co., 349 U.S. 969, 75 S.Ct. 878, 99 L.Ed. 1290; Zientek v. Reading Co., 350 U.S. 960, 76 S.Ct. 345, 100 L.Ed. 834; Preferred Ins. Co. v. United States, 351 U.S. 990, 76 S.Ct. 1044, 100 L.Ed. 1502; International Molders & Foundry Workers, etc. v. Western Foundry Co., 352 U.S. 860, 77 S.Ct. 22, 1 L.Ed.2d 70; Fairmont Aluminum Co. v. Commissioner, 352 U.S. 913, 77 S.Ct. 144, 1 L.Ed.2d 120; Bernstein v. United States, 352 U.S. 977, 77 S.Ct. 351, 1 L.Ed.2d 330; Mekolichick v. United States, 352 U.S. 977, 77 S.Ct. 351, 1 L.Ed.2d 330; Consolidated Edison Co. of New York, Inc., v. United States, 352 U.S. 1019, 77 S.Ct. 552.20
17
This history of past practice justifies the assertion that the Court has exercised its inherent power with a sharp eye to the 'principle that litigation must at some definite point be brought to an end,' Federal Trade Commission v. Minneapolis-Honeywell Regulator Co., 344 U.S. 206, 213, 73 S.Ct. 245, 249, 97 L.Ed. 245, and, in recent years at least, has acted only where it felt that the interests of justice plainly outweighed considerations of finality.
18
What about this case? There is nothing to distinguish it from any other suit for a money judgment in which a conflict turns up long after certiorari and rehearing have been denied. The most that can be said in justification of the Court's action is that otherwise Ohio Power would not have to pay taxes which Allen-Bradley and National Lead must pay as a result of the much later decisions in their cases. Yet the Court twice faced and rejected that very possibility many months ago, (1) when it denied the Government's timely petition for rehearing, despite the request that consideration of it be deferred until the Court of Appeals had decided the National Lead case, and (2) when it denied the Government's second, and untimely, petition for rehearing in the face of the conflict with National Lead. And in any event, this is surely not the kind of injustice that warrants overriding the policy of finality of adjudication. What has happened here is commonplace; indeed it arises in every instance where the Court grants certiorari to settle any but the most recent conflict. Perhaps out-of-time action may be justified in some instances where the time interval between a finally decided case and a subsequent contrary decision of this Court is short. But we do not have that situation here, where more than 15 months elapsed between the denial of certiorari in Ohio Power (October 17, 1955) and our decisions in Allen-Bradley and National Lead (January 22, 1957), and where in the interval the Court had twice denied rehearing, with the very factors before it which are now said to justify its present action. If the rules of finality are to have real significance in this Court, I submit that by every token the taxpayer here was entitled to believe that its had been irrevocably closed.
19
There is an additional reason why this case should not now be reopened. Had this case come to us from the Tax Court, our Court would have had no power to do what it has done, it being well established that when certiorari has been denied the power of this Court to affect decision of the Tax Court ends with the denial of a petition for rehearing, or, where no such petition has been filed, with the running of the 25-day period within which rehearing may be sought. Internal Revenue Code of 1939, § 1140, now Internal Revenue Code of 1954, § 7481(2)(B), 26 U.S.C.A. § 7481(2)(B); R. Simpson & Co. v. Commissioner, 321 U.S. 225, 64 S.Ct. 496, 88 L.Ed. 688; and see Helvering v. Northern Coal Co., 293 U.S. 191, 55 S.Ct. 3, 79 L.Ed. 281. It is an odd circumstance that the Court should have reaffirmed this rule only a few weeks ago. Lasky v. Commissioner, 352 U.S. 1027, 77 S.Ct. 594. The undesirability of according different treatment to tax cases arising from different sources scarcely requires comment. For me, this consideration alone is a sufficient reason for denying relief in this case.
20
For the reasons given I must dissent. I can think of nothing more unsetting to lawyers and litigants, and more disturbing to their confidence in the evenhandedness of the Court's processes, than to be left in the kind of uncertainty which today's action engenders, as to when their cases may be considered finally closed in this Court.
1
54 Stat. 998—1003, as amended, 26 U.S.C. §§ 23(t), 124, 26 U.S.C.A. §§ 23(t), 124.
2
131 Ct.Cl. 95, 129 F.Supp. 215.
3
230 F.2d 161.
4
Ibid.
5
134 Ct.Cl. 800.
6
On May 29, 1956, National Lead Company likewise filed its petition for certiorari to the Court of Appeals for the Second Circuit in the case which it had lost.
7
Rule 58, par. 2, of this Court's Revised Rules, 28 U.S.C.A., provides: 'A petition for rehearing of orders on petitions for writs of certiorari may be filed with the clerk * * * subject to the requirements respecting time * * * as provided in paragraph 1 of this rule.' Paragraph 1 of Rule 58 provides: 'A petition for rehearing of judgments or decisions other than those denying or granting certiorari, may be filed with the clerk * * * within twenty-five days after judgment or decision, unless the time is shortened or enlarged by the court or a justice thereof.' There was, of course, no enlargement of the time here. Paragraph 4 of Rule 58 provides: 'Consecutive petitions for rehearings, and petitions for rehearing that are out of time under this rule, will not be received.'
8
The writer of this opinion, and those who join him, share in the responsibility for the issuance of the order of June 11.
9
Under the old Rules, it was not thought possible to petition for rehearing of a denial of rehearing. Such petitions were treated as miscaptioned untimely petitions for rehearing of the original order. Presumably the same practice obtains under the Revised Rules. Otherwise, an endless procession of 'timely' petitions for rehearing could be filed, one every 25 days ad infinitum.
10
So far as pertinent, § 452 provides: 'The continued existence or expiration of a term of court in no way affects the power of the court to do any act or take any proceeding.'
11
'The period of time provided for the doing of any act or the taking of any proceeding is not affected or limited by the continued existence or expiration of a term of court. The continued existence or expiration of a term of court in no way affects the power of a court to do any act or take any proceeding in any civil action which has been pending before it.'
12
Textwriters have disagreed as to the effect of § 452. Compare Wiener, The Supreme Court's New Rules, 68 Harv.L.Rev. 20, 84—86 (1954), with Stern & Gressman, Supreme Court Practice (2d ed. 1954), 349, 355.
13
It may be suggested that, because this Court has no rules comparable to Fed.Rules Civ.Proc., 60(a) and (b), permitting applications for subsequent changes in judgments to be made on various grounds, it would be unfortunate to construe § 452 as prohibiting this Court from exercising inherent power to correct judgments out of time for such things as fraud, mistake, and clerical error. To my way of thinking, it would be preferable to meet this problem by adding to our Rules, rather than by making ad hoc exceptions to Rule 58. The latter course, I fear, is bound to lead to the sort of thing that has happened in this case, leaving litigants in uncertainty as to when they may safely consider their cases closed in this Court.
14
See Charles Elmore Cropley, Report of Survey by the Clerk of Rules and Practice in Relation to Petitions for Rehearing, Prepared by Direction of the Chief Justice, with Suggestions and Supporting Data (January 7, 1947).
15
See also People of State of California v. Zook, 337 U.S. 921, 69 S.Ct. 1152, 93 L.Ed. 1729, in which a motion for leave to file a petition for rehearing out of time was granted, apparently on grounds of excusable neglect, and the petition was simultaneously denied; and Land v. Dollar, 341 U.S. 737, 738, 71 S.Ct. 987, 988, 95 L.Ed. 1331, in which a belated 'motion for leave to file a motion for reconsideration' of a denial of certiorari was continued on the docket. The motion was ultimately withdrawn. 344 U.S. 807, 73 S.Ct. 4.
16
Clark involved questions under the Trading with the Enemy Act, an untimely petition for rehearing of the denial of certiorari being granted because of a subsequently arising conflict. Unlike the present case, there was no other pending case through which the question could be settled by this Court for the future, because the 'conflict' case was never appealed. See McGrath v. E. J. Lavino & Co., D.C., 91 F.Supp. 786, 787. More recently the Court has consistently denied belated petitions for rehearing based upon claimed subsequent conflicts. See the cases cited 353 U.S. 108, 109, 77 S.Ct. 657, 658, infra, and particularly Mondakota Gas Co. v. Montana-Dakota Utilities Co., 349 U.S. 969, 75 S.Ct. 878, 99 L.Ed. 1290, where the Court denied leave to file an untimely petition for rehearing even though the decision below had been expressly disapproved by an intervening and controlling decision of this Court. See Parissi v. Telechron, Inc., 349 U.S. 46, 47, 75 S.Ct. 577, 99 L.Ed. 867.
The Clark case is not a persuasive precedent on any of the legal questions involved in this case, because for all that appears neither side called the attention of the Court to the then recent enactment of § 452 and its possible restrictive effects on prior rules relating to rehearings.
17
Cf. Born v. Laube, 348 U.S. 932, 75 S.Ct. 336, 99 L.Ed. 730; Bernstein v. United States, 352 U.S. 977, 77 S.Ct. 351, 1 L.Ed.2d 330; Mekolichick v. United States, 352 U.S. 977, 77 S.Ct. 351, 1 L.Ed.2d 330; Cliett v. Scott, 353 U.S. 918, 77 S.Ct. 661, in which the Court simultaneously granted motions for leave to file petitions for rehearing out of time, and denied the petitions for rehearing. See also Smith v. United States, 353 U.S. 921, 77 S.Ct. 678.
18
The count includes untimely petitions for rehearing, successive petitions for rehearing, motions for leave to file petitions for rehearing, motions for leave to file successive petitions for rehearing, and motions and petitions for reconsideration of denial of rehearing or of leave to file petitions for rehearing. See 335 U.S. 838 (two cases), 855, 864 (six cases), 888, 894 (two cases), 899, 900 (69 S.Ct. 12, 14, 77, 123, 130, 124, 232, 242, 294, 298); 336 U.S. 911, 915 (four cases), 921, 929 (two cases), 932 (two cases), 941, 955, 963, 971 (69 S.Ct. 513, 599, 600, 601, 636, 654, 736, 737, 744, 875, 885, 929); 337 U.S. 911, 920, 921 (two cases), 934, 950 (three cases), 953 (two cases), 961 (five cases) (69 S.Ct. 1050, 1151, 1152, 1493, 1512, 1513, 1501, 1525, 1526, 1525, 1521, 1529, 1530); 338 U.S. 841 (four cases), 863, 882, 889, 939, 940, 953 (70 S.Ct. 33, 34, 35, 36, 96, 149, 181, 338, 478); 339 U.S. 906, 916, 926, 936, 950, 954, 972, 973 (three cases), 992 (two cases) (70 S.Ct. 513, 559, 608, 661, 798, 837, 983, 984, 985, 986, 1018, 1007); 340 U.S. 846, 848, 898, 907, 918, 939, 940 (71 S.Ct. 13, 11, 237, 276, 348, 480); 341 U.S. 917, 928, 933, 937, 956 (four cases) (71 S.Ct. 733, 795, 801, 854, 1010, 1012, 1013); 342 U.S. 842, 844, 856, 874, 880, 895, 899 (two cases), 907 (two cases), 915 (72 S.Ct. 22, 23, 71, 104, 171, 198, 228, 233, 289, 297, 357); 343 U.S. 917 (two cases), 931, 932, 952, 959 (two cases), 989 (three cases) (72 S.Ct. 645, 649, 756, 1040, 1054, 1070, 1078); 344 U.S. 848, 849, 850 (two cases), 882, 905 (73 S.Ct. 4, 5, 48, 173, 286); 345 U.S. 914, 931 (two cases), 937 (two cases), 945, 960, 961, 971, 1003, 1004 (73 S.Ct. 651, 787, 786, 798, 827, 935, 942, 1113, 1129, 1141); 346 U.S. 841, 843 (two cases, total of three petitions), 880 (three cases), 881, 904, 905 (two cases), 917, 918 (74 S.Ct. 19, 17, 117, 118, 130, 216 228, 276); 347 U.S. 908 (two cases), 911 (two cases), 924 (three cases), 940, 1007 (three cases), 1021 (74 S.Ct. 426, 429, 474, 473, 512, 511, 520, 626, 861, 862, 860); 348 U.S. 851 (two cases), 853 (two cases), 889, 904, 932, 939 (three cases), 940, 960 (two cases) (75 S.Ct. 18, 19, 20, 202, 288, 336, 354, 357, 358, 448, 447); 349 U.S. 917, 925, 918, 969 (two cases) (75 S.Ct. 603, 657, 870, 878, 879); 350 U.S. 413, 811, 854, 856, 919, 920, 955, 960, 976 (76 S.Ct. 464, 37, 41, 40, 199, 200, 341, 345, 429); 351 U.S. 183, 915 (two cases), 928, 929, 958, 990 (76 S.Ct. 758, 693, 701, 778, 777, 844, 1044); 352 U.S. 860, 861 (four cases), 886, 913, 950, 977 (two cases), 1019, 1023 (77 S.Ct. 22, 26, 28, 134, 144, 324, 351); 353 U.S. 918, 921, 77 S.Ct. 661, 670, 678.
19
See 348 U.S. 851 (two cases), 853 (two cases), 889, 932, 939 (three cases), 940, 960 (two cases) (75 S.Ct. 18, 19, 20, 202, 336, 354, 357, 358, 448, 447); 349 U.S. 917, 925, 948, 969 (two cases) (75 S.Ct. 603, 657, 870, 878, 879); 350 U.S. 854, 920, 955, 960, 976 (76 S.Ct. 41, 200, 341, 345, 429); 351 U.S. 915 (two cases), 928, 929, 958, 990 (76 S.Ct. 693, 701, 778, 777, 844, 1044); 352 U.S. 860, 861 (three cases), 886, 913, 977 (two cases), 1019, 1023 (77 S.Ct. 22, 26, 27, 28, 134, 144, 351); 353 U.S. 918, 921, 77 S.Ct. 661, 670, 678.
20
As to Bernstein and Mekolichick, see note 17, supra.
| 89
|
353 U.S. 81
77 S.Ct. 649
1 L.Ed.2d 671
Gordon P. HAYNES and Essie M. Haynes, Petitioners,v.UNITED STATES of America.
No. 257.
Argued March 5, 1957.
Decided April 1, 1957.
Mr.
John H. Hudson, Atlanta, Ga., for the petitioners.
Mr. Hilbert P. Zarky, Washington, D.C., for the respondent.
Mr. Justice BLACK delivered the opinion of the Court.
1
In 1949, the petitioner, Gordon P. Haynes, became sick and unable to work while employed by the Southern Bell Telephone and Telegraph Company. At that time the company had in effect a comprehensive 'Plan for Employees' Pensions, Disability Benefits and Death Benefits.' This plan had been in force since 1913 when it was adopted by Southern Bell and other companies in the American Telephone and Telegraph Company system. A written copy of the plan, which was prepared much like an insurance policy, was given every person upon his initial employment by the company. Among other things, the plan provided that Southern Bell 'undertakes in accordance with these Regulations, to provide for the payment of definite amounts to its employees when they are disabled by accident or sickness.' Under the plan every employee was entitled, after two years' service with Southern Bell, to receive 'sickness disability benefits' when he missed work because of illness. These payments began on the eighth calendar day of absence due to illness. The amount and duration of payments were set out with specificity and varied with the length of service. For example, employees who had worked for Southern Bell from two to five years were entitled to full pay for four weeks and one-half pay for nine additional weeks; employees who had been with the company for more than twenty-five years were entitled to full pay for fifty-two weeks. The company reserved the right to change or terminate the plan but agreed that no changes would be made which affected 'the rights of any employee, without his consent, to any benefit or pension to which he may have previously become entitled hereunder.'
2
Under the plan petitioner was paid $2,100 in sickness disability benefits during 1949. Since he had been an employee of the company for more than twenty-five years this was the full equivalent of what he would have received had he been working. The Government collected $318.44 income tax on petitioner's sickness benefits. He brught this action for a refund contending that these receipts were not taxable because of § 22(b)(5) of the 1939 Internal Revenue Code which exempted from taxable income 'amounts received through accident or health insurance * * * as compensation for personal injuries or sickness.'1 The District Court held that the payments received by petitioner on account of sickness were not taxable and directed a refund. The Court of Appeals reversed, accepting the Government's contention that Southern Bell's plan was not 'health insurance' but a 'wage continuation plan.' 5 Cir., 233 F.2d 413. In Epmeier v. United States, 199 F.2d 508, the Seventh Circuit held that disability payments under a plan similar to Southern Bell's were not taxable. Because of this conflict we granted certiorari, 352 U.S. 820, 77 S.Ct. 60, 1 L.Ed.2d 46.
3
The crucial question is whether the Southern Bell plan should be treated as 'health insurance' within the meaning of § 22(b)(5). Broadly speaking, health insurance is an undertaking by one person for reasons satisfactory to him to indemnify another for losses caused by illness. We believe that the Southern Bell disability plan comes within this meaning of health insurance.
4
If Southern Bell had purchased from a commercial insurance company health insurance that provided its employees with precisely the same kind of protection promised under its own plan, the Government concedes that the payments received by ailing employees from the commercial company would not have been taxable. Nevertheless it argues that Southern Bell's plan should not be treated as 'health insurance' because the employees paid no fixed periodic premiums, there was no definite fund created to assure payment of the disability benefits, and the amount and duration of the benefits varied with the length of service.2 We do not believe that these facts remove the plan from the general category of health insurance. The payment of premiums in a fixed amount at regular intervals is not a necessary element of insurance. Similarly there is no necessity for a definite fund set aside to meet the insurer's obligations. And the fact that the amount and duration of benefits increased with the length of time that an employee worked for Southern Bell reflected the added value to the company of extra years of experience and service. Apparently the Government relies on these facts primarily to show that Southern Bell's plan did not contain features which would be present in the normal commercial insurance contract. The Government, however, offers no persuasive reason why the term 'health insurance' in § 22(b)(5) should be limited to the particular forms of insurance conventionally made available by commercial companies. Certainly there is nothing in the language of § 22(b)(5) which compels this limitation.
5
There is no support in the legislative history for the Government's argument that Congress intended to restrict the exemption provided in § 22(b)(5) to 'conventional modes of insurance' and not to include employer disability plans. For reasons deemed satisfactory, Congress, since 1918, has chosen not to tax receipts from health and accident insurance contracts.3 The language of § 22(b)(5) appeared in the Revenue Act of 1918 and has reappeared without relevant change in all succeeding revenue acts up to 1954.4 The term 'health insurance' was not defined in any of these acts or in any of the committee reports. There has been no uniform administrative practice which can be drawn upon to support the narrow meaning of § 22(b)(5) now urged by the Government. Administrative rulings since 1918 appear to have regularly vacillated between holding receipts under company disability plans taxable and holding that they are not taxable.5 Under these circumstances we see no reason why the term 'health insurance' in § 22(b)(5) should not be given its broad general meaning. See Helvering v. Le Gierse, 312 U.S. 531, 61 S.Ct. 646, 85 L.Ed. 996.
6
The judgment of the Court of Appeals is reversed and the judgment of the District Court which held that petitioner was entitled to a refund is affirmed.
7
It is so ordered.
8
Affirmed.
9
Mr. Justice BURTON and Mr. Justice HARLAN dissent for the reasons stated in the opinion of the Court of Appeals, 233 F.2d 413. See also, Moholy v. United States, 9 Cir., 235 F.2d 562; I.R.C., 1954, §§ 104—106, 26 U.S.C.A. §§ 104—106, and the accompanying report, H.R.Rep.No. 1337, 83d Cong., 2d Sess. 15, A32 A35.
10
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
1
26 U.S.C. § (1952 ed.) § 22(b)(5), 26 U.S.C.A. § 22(b)(5).
2
The Government points to several other aspects of the Southern Bell plan as demonstrating that it is not 'health insurance.' After consideration of the Government's contentions in this respect we find they are without merit.
3
In Epmeier v. United States, 199 F.2d 508, 511, the Seventh Circuit was of the opinion that: 'The provisions of Section 22(b)(5) undoubtedly were intended to relieve a taxpayer who has the misfortune to become ill or injured, of the necessity of paying income tax upon insurance benefits received to combat the ravages of disease or accident.'
4
Section 22(b)(5) can be traced to § 213(b)(6) of the Revenue Act of 1918, 40 Stat. 1066. In §§ 104, 105 and 106 of the 1954 Internal Revenue Code, 26 U.S.C. (Supp. III) §§ 104—106, 26 U.S.C.A. §§ 104—106, Congress again exempted amounts received through health insurance. However these new provisions limited the exclusion for receipts similar to those involved here to a maximum of $100 per week. We do not accept the Government's contention that the enactment of §§ 104—106 shows that Congress in 1918, and in succeeding revenue measures, intended to distinguish between conventional commercial insurance and an employer's plan like that of Southern Bell's.
5
T.D. 2747, 20 Treas.Dec.Int.Rev. 457 (1918); G.C.M. 23511, Cum.Bull. 86 (1943); I.T. 4000, 1 Cum.Bull. 21 (1950); I.T. 4015, 1 Cum.Bull. 23 (1950); I.T. 4107, 2 Cum.Bull. 73 (1952); Rev.Rul. 208, 1953—2 Cum.Bull. 102. For a discussion of the difficulties of the American Telephone and Telegraph Company's system because of the shifting administrative practice see Hearings before House Committee on Ways and Means on Forty Topics Pertaining to the General Revision of the Internal Revenue Code, 83d Cong., 1st Sess. 363.
| 1112
|
353 U.S. 138
77 S.Ct. 699
1 L.Ed.2d 709
William BENZ et al., Petitioners,v.COMPANIA NAVIERA HIDALGO, S.A., a Corporation.
No. 204.
Argued March 6, 1957.
Decided April 8, 1957.
Mr.
Kneland C. Tanner, Portland, Or., for petitioners.
Mr. John D. Mosser, Portland, Or., for respondent.
Mr. Justice CLARK delivered the opinion of the Court.
1
While the petitioners in this diversity case present several questions, the sole one decided is whether the Labor Management Relations Act of 19471 applies to a controversy involving damages resulting from the picketing of a foreign ship operated entirely by foreign seamen under foreign articles while the vessel is temporarily in an American port. We decide that it does not, and therefore do not reach other questions raised by the parties.
2
The S.S. Riviera on September 3, 1952, sailed into harbor at Portland, Oregon, for repairs, to load a cargo of wheat, and to complete an insurance survey. It was owned by respondent, a Panamanian corporation, and sailed under a Liberian flag. The crew was made up entirely of nationals of countries other than the United States, principally German and British. They had agreed to serve on a voyage originating at Bremen, Germany, for a period of two years, or until the vessel returned to a European port. A British form of articles of agreement was opened at Bremen. The conditions prescribed by the British Maritime Board were incorporated into the agreement, including wages and hours of employment, all of which were specifically set out. The crew further agreed to obey all lawful commands of the Master of the Riviera in regard to the ship, the stores, and the cargo, whether on board, in boats, or on shore.
3
On or about September 9, 1952, the members of the crew went on strike on board the vessel and refused to obey the orders of the Master. They demanded that their term of service be reduced, their wages be increased, and more favorable conditions of employment be granted.2 They refused to work, demanding their back pay and transportation or its cost to their ports of engagement. The Master told the crew to continue their work or they would be discharged. When they declined to work he discharged them and ordered them to leave the ship, which they refused to do. This situation continued until September 26, 1952, when the striking crewmen left the vessel pursuant to an order of the United States District Court entered in a possessory libel filed by the respondent. The crew had picketed the vessel from September 9, 1952, when the strike began, until September 26, when they left the ship. On September 15, 1952, they had designated the Sailors' Union of the Pacific as their collective bargaining representative. The striking crew or others acting for them continued the picketing from September 26, 1952, until they withdrew the picket line on October 13, 1952. The Sailors' Union of the Pacific began picketing the Riviera on October 14 and continued to do so until restrained by an injunction issued in an action for injunctive relief and damages filed against it and its principal representatives by the respondent. Two days later Local 90 of the National Organization of Masters, Mates and Pilots of America set up a picket line at the Riviera which was maintained until December 8, 1952. This picketing was stopped by a writ issued against that union and its representatives in the second action for injunction and damages filed by respondent and consolidated here. On December 10, 1952, another picket line was established at the vessel. It was maintained this time by the Atlantic and Gulf Coast District, S.I.U.,3 until it too was enjoined on December 12 in a third action filed by the respondent in which the prayer likewise was for an injunction and damages. These three cases have been consolidated for consideration here. All of the picketing was peaceful.
4
The ship sailed in December 1952. In June 1953, the injunction orders were vacated on appeal to the Court of Appeals and were ordered dismissed as moot. The cases were returned to the District Court for trial on the damage claims. 9 Cir., 205 F.2d 944. The ship had not returned to an American port at the time of trial in 1954. At the trial the court found that the purpose of the picketing 'was to compel the (respondent) to re-employ' the striking members of the crew for a shorter term and at more favorable wage rates and conditions than those agreed upon in the articles. The court further found that as a result of the picketing the employees of the firms repairing and loading the vessel refused to cross the picket line and the ship was forced to stand idly by without repairs or cargo, all to the damage of respondent. The unions and their representatives contended that the trial court was without jurisdiction because the Labor Management Relations Act had pre-empted the field. However, the trial court entered judgment for damages against the three unions as well as their principal representatives. The judgments were based on a common-law theory that the picketing was for an unlawful purpose under Oregon law. The court found that respondent had no remedy under the Labor Management Relations Act because that Act 'is concerned solely with the labor relations of American workers between American concerns and their employees in the United States, and it is not intended to, nor does it cover a dispute between a foreign ship and its foreign crew.' The Court of Appeals thought that United Construction Workers, Affiliated with United Mine Workers of America v. Laburnum Construction Corp., 1954, 347 U.S. 656, 74 S.Ct. 833, 98 L.Ed. 1025, governed, but that Oregon law did not permit recovery against the unions since they were unincorporated associations. 9 Cir., 233 F.2d 62.4 This, in effect, left the judgments standing against the individual representatives of the unions, the petitioners here. We granted certiorari in order to settle the important question of jurisdiction 352 U.S. 889, 77 S.Ct. 125, 1 L.Ed.2d 84.
5
It should be noted at the outset that the dispute from which these actions sprang arose on a foreign vessel. It was between a foreign employer and a foreign crew operating under an agreement made abroad under the laws of another nation. The only American connection was that the controversy erupted while the ship was transiently in a United States port and American labor unions participated in its picketing.
6
It is beyond question that a ship voluntarily entering the territorial limits of another country subjects itself to the laws and jurisdiction of that country. Wildenhus' Case, 1887, 120 U.S. 1, 7 S.Ct. 385, 30 L.Ed. 565. The exercise of that jurisdiction is not mandatory but discretionary. Often, because of public policy or for other reasons, the local sovereign may exert only limited jurisdiction and sometimes none at all. Cunard S.S. Co. v. Mellon, 1923, 262 U.S. 100, 43 S.Ct. 504, 67 L.Ed. 894. It follows that if Congress had so chosen, it could have made the Act applicable to wage disputes arising on foreign vessels between nationals of other countries when the vessel comes within our territorial waters. The question here therefore narrows to one of intent of the Congress as to the coverage of the Act.
7
The parties point to nothing in the Act itself or its legislative history that indicates in any way that the Congress intended to bring such disputes within the coverage of the Act. Indeed the District Court found to the contrary, specifically stating that the Act does not 'cover a dispute between a foreign ship and its foreign crew.' The Court of Appeals, though not passing on the question, noted that 'It may well be that American laws should not be construed to apply, without some more explicit Congressional indication than we are able to find in the National Labor Relations Act, as amended, to situations with as many points of foreign contact as the situation at bar.' 233 F.2d at page 65.
8
Our study of the Act leaves us convinced that Congress did not fashion it to resolve labor disputes between nationals of other countries operating ships under foreign laws.5 The whole background ground of the Act is concerned with industrial strife between American employers and employees. In fact, no discussion in either House of Congress has been called to our attention from the thousands of pages of legislative history that indicates in the least that Congress intended the coverage of the Act to extend to circumstances such as those posed here. It appears not to have even occurred to those sponsoring the bill. The Report made to the House by its Committee on Education and Labor and presented by the coauthor of the bill, Chairman Hartley, stated that 'the bill herewith reported has been formulated as a bill of rights both for American workingmen and for their employers.' The report declares further that because of the inadequacies of legislation 'the American workingman has been deprived of his dignity as an individual,' and that it is the purpose of the bill to correct these inadequacies. (Emphasis added.) H.R.Rep. No. 245, 80th Cong., 1st Sess. 4. What was said inescapably describes the boundaries of the Act as including only the workingmen of our own country and its possessions.
9
The problem presented is not a new one to the Congress. In the Seamen's Act of March 4, 1915, 38 Stat. 1164, the Congress declared it unlawful to pay a seaman wages in advance and specifically declared the prohibition applicable to foreign vessels 'while in waters of the United States.' Id., at 1169, as amended, 46 U.S.C. § 599(e), 46 U.S.C.A. § 599(e). In Sandberg v. McDonald, 1918, 248 U.S. 185, 39 S.Ct. 84, 63 L.Ed. 200, this Court construed the Act as not covering advancements 'when the contract and payment were made in a foreign country where the law sanctioned such contract and payment * * *. Had Congress intended to make void such contracts and payments a few words would have stated that intention, not leaving such an important regulation to be gathered from implication.' Id., 248 U.S. at page 195, 39 S.Ct. at page 86. The Court added that 'such sweeping and important requirement is not found specifically made in the statute.' Ibid. See also Neilson v. Rhine Shipping Co., 1918, 248 U.S. 205, 39 S.Ct. 89, 63 L.Ed. 208. In 1920 Congress amended § 4 of the Seamen's Act of 1915, and granted to every seaman on a vessel of the United States the right to demand one-half of his then earned wages at every port the vessel entered during a voyage. 41 Stat. 1006, 46 U.S.C. § 597, 46 U.S.C.A. § 597. The section was made applicable to 'seamen on foreign vessels while in harbors of the United States, and the courts of the United States shall be open to such seamen for its enforcement.' This Court in Strathearn Steamship Co. v. Dillon, 1920, 252 U.S. 348, 40 S.Ct. 350, 64 L.Ed. 607, upheld the applicability of the section to a British seaman on a British vessel under British articles. The Court pointed out:
10
'taking the provisions of the act as the same are written, we think it plain that it manifests the purpose of Congress to place American and foreign seamen on an equality of right in so far as the privileges of this section are concerned, with equal opportunity to resort to the courts of the United States for the enforcement of the act. Before the amendment * * * the right to recover one-half the wages could not be enforced in face of a contractual obligation to the contrary. Congress, for reasons which it deemed sufficient, amended the act so as to permit the recovery upon the conditions named in the statute.' Id., 252 U.S. at page 355, 40 S.Ct. at page 352.
11
In 1928, Jackson v. S.S. Archimedes, 275 U.S. 463, 48 S.Ct. 164, 72 L.Ed. 374, was decided by this Court. It involved advance payments made by a British vessel to foreign seamen before leaving Manchester on her voyage to New York and return. It was contended that the advances made in Manchester were illegal and void. That there was 'no intention to extend the provisions of the statute,' the Court said, 'to advance payments made by foreign vessels while in foreign ports, is plain. This Court had pointed out in the Sandberg case, supra, that such a sweeping provision was not specifically made in the statute * * *.' Id., 275 U.S. at page 470, 48 S.Ct. at page 166. Soon thereafter several proposals were made in Congress designed to extend the coverage of the Seamen's Act so as to prohibit advancements made by foreign vessels in foreign ports. A storm of diplomatic protest resulted. Great Britain, Italy, Sweden, Norway, Denmark, the Netherlands, Germany, and Canada all joined in vigorously denouncing the proposals.6 In each instance the bills died in Congress.
12
And so here such a 'sweeping provision' as to foreign applicability was not specified in the Act.7 The seamen agreed in Germany to work on the foreign ship under British articles. We cannot read into the Labor Management Relations Act an intent to change the contractual provisions made by these parties. For us to run interference in such a delicate field of international relations there must be present the affirmative intention of the Congress clearly expressed. It alone has the facilities necessary to make fairly such an important policy decision where the possibilities of international discord are so evident and retaliative action so certain. We, therefore, conclude that any such appeal should be directed to the Congress rather than the courts.
13
Affirmed.
14
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
15
Mr. Justice DOUGLAS, dissenting.
16
The case involves a contest between American unions and a foreign ship. The foreign ship came to Portland, Oregon, to load a cargo of wheat for carriage to India. The crew members were paid about one-third the amount of cash wages that are paid to American seamen on American vessels carrying grain to the Orient. This foreign ship is in competition with those American vessels.
17
American unions, therefore, have a interest in the working conditions and wages of the seamen aboad this foreign vessel. Their interest is in the re-employment of the foreign crew at better wages and working conditions. And they peacefully picketed the foreign vessel to further that interest.
18
The judgment we sustain today is one in damages against members of the American union who engaged in that peaceful picketing. It is for conduct precisely regulated by the Taft-Hartley Act.
19
If, as the District Court found, the purpose of the picketing was to prevent the repairing and loading of the foreign vessel, the question then arises whether the peaceful picketing was not a secondary boycott condemned by § 303(a)(1) of the Act.
20
If the purpose of the peaceful picketing was to force the foreign vessels to bargain with one of the American unions without any of them being first certified as the representative of the seamen, the question arises whether that was not a violation of § 303(a)(2) of the Act.
21
If either § 303(a)(1) or § 303(a)(2) was violated, then the injured person may sue in the federal courts for damages, as provided in § 303(b). The Court bases its decision that the Act is inapplicable on the conclusion that the underlying controversy was between the foreign vessel and its crew. It intimates, however, that the Act would apply if this suit had been brought by the American independent contractors whose employees refused to cross the picket line, although the identical conduct by the American unions were involved. But, even if we assume arguendo that the foreign vessel would not be subject to the regulatory provisions of the Act, it could nonetheless sue under § 303(b) to get protection from any unfair labor practice condemned by the Act. That is indeed the force of our ruling in Local Union No. 25 of International Brotherhood of Teamsters, etc. v. New York, N.H. & H.R. Co., 350 U.S. 155, 160—161, 76 S.Ct. 227, 230—231, 100 L.Ed. 166.
22
The Labor Board has asserted jurisdiction over unions that bring their pressures to bear on vessels of foreign registry. (In the matter of Sailors' Union of the Pacific, 92 N.L.R.B. 547), at the same time that it has declined to assume jurisdiction over the foreign vessel.1 Id., pp. 560—561.
23
If there is to be peace along the waterfront and a full and free flow of commerce as declared in § 1 of the Act, these American unions should be subject only to disciplinary action by the federal agencies to whom Congress has entrusted the job of law enforcement.2 Only by applying those centralized controls can we avoid the 'diversities and conflicts likely to result from a variety of local procedures and attitudes toward labor controversies.' Garner v. Teamsters, Chaufferus & Helpers Local Union, 346 U.S. 485, 490, 74 S.Ct. 161, 166, 98 L.Ed. 228.
24
There is no hiatus in the federal regulatory scheme as was true in United Construction Workers, Affiliated with United Mine Workers of America v. Laburnum Construction Corp., 347 U.S. 656, 74 S.Ct. 833, 98 L.Ed. 1025. The facts alleged in the complaint, if true, might constitute unfair labor practices under the Act; and Congress has provided, as against American unions, both an administrative remedy and a remedy by way of damages. I see no answer therefore to the conclusion that state law has been pre-empted by federal law within the meaning of our decision in Weber v. Anheuser-Busch Inc., 348 U.S. 468, 75 S.Ct. 480, 99 L.Ed. 546.
25
If American unions or their members are to be mulcted in damages for unfair labor practices affecting commerce, Congress has provided the way in which it shall be done.
1
61 Stat. 136, 29 U.S.C. § 141, 29 U.S.C.A. § 141.
2
The demands were first transmitted to the Master on September 7, 1952, by a person identifying himself as a delegate of the Sailors' Union of the Pacific. None of the crew belonged to that union. At 3 a.m. on September 8, 1952, the same party and some of the crew members called on the Master in his cabin. They demanded that he come to the crew's quarters and bargain with them on wages and conditions on the ship. This demand was refused. While claim was made that filthy conditions existed aboard and contaminated food was served, the court, after hearing evidence and personally inspecting the vessel, found to the contrary. There is no issue here as to these findings.
3
None of the crew were members of any of the three unions involved in the intermittent picketing.
4
A cross-petition for certiorari was filed for a review of this question. The petition was denied. Compania Naviera Hidalgo, S.A. v. Benz, 352 U.S. 890, 77 S.Ct. 126, 1 L.Ed. 85.
5
Petitioners rely on two cases to bolster their argument that the Act applies to a foreign dispute such as the one here. We need only say that these cases are inapposite, without, of course, intimating any view as to their result. First petitioners seek support in Sailors' Union of the Pacific, AFL and Moore Dry Dock Co., 92 N.L.R.B. 547 (1950). That case, however, was brought to the Board by an American employer, the owner of the drydock, claiming that the picketing by an American Sailors' Union was of the drydock and constituted a secondary boycott and therefore an unfair labor practice. The Board in its opinion gave no indication that it felt that the Taft-Hartley Act was intended to apply to a dispute involving employment aboard a foreign vessel. In fact, in a forerunner of that same case, Compania Maritima Sansoc Limitada, Case No. 20—RC—809, May 1, 1950, CCH NLRB Decisions, 1950—1951, 10,081, a petition to represent employees on a Panamanian vessel manned by foreign seamen, and owned by a Panama corporation, the majority of whose stockholders were citizens of foreign countries, was dismissed on the ground that the internal economy of a vessel of foreign registry and ownership was involved. The Board thus made it clear that it would not assume jurisdiction when a foreign vessel was involved. It did assume jurisdiction in the later dispute because that dispute was between an American employer and an American union.
The second case on which petitioners rely is Norris Grain Co. v. Seafarers' International Union, 1950, 232 Minn. 91, 46 N.W.2d 94. There a suit for an injunction was brought by the American owner of a grain elevator in Duluth, Minn., charging an American union and its affiliate with a secondary boycott by picketing, not of a foreign vessel, but of the grain elevator. Though a Canadian union (affiliated with the American union) was joined as a defendant, the action ran between an American plaintiff-employer and an American defendant-union. There was no claim by the foreign vessel owner against a union.
6
1 U.S. Foreign Rel.: 1928 at 830—838 (Dept.State 1942); id.: 1929 at 1005—1009 (Dept.State 1943); id.: 1931 at 808—814 (Dept.State 1946); id.: 1932 at 959—960 (Dept.State 1948).
7
As far back as 1856 this Court was faced with a related problem. In Brown v. Duchesne, 1857, 19 How. 183, 60 U.S. 183, 15 L.Ed. 595, in construing our patent laws which were silent as to their coverage of foreign ships in our ports, the Court held that Congress had expressed no intention of subjecting the use of improvements on foreign vessels stopping at our ports to our patent laws. In this regard the Court said: 'We think these laws ought to be construed in the spirit in which they were made—that is, as founded in justice—and should not be strained by technical constructions to reach cases which Congress evidently could not have contemplated, without departing from the principle upon which they were legislating, and going far beyond the object they intended to accomplish.' Id., 60 U.S. at page 197.
1
The Sailors' Union of the Pacific picketed the main gate of a San Francisco shipyard, where a ship of foreign registry and ownership was undergoing repairs, after the owner of the vessel refused to recognize the union as exclusive representative of the crew. After the picketing began, the union filed, with the Board's Regional Office, a petition to be certified as the representative of the vessel's crew. As noted by the Court, the Board's Regional Director administratively dismissed the petition, 'inasmuch as the internal economy of a vessel of foreign registry and ownership is involved.' The Board sustained the Regional Director's action on the ground that it had no jurisdiction over the foreign owner of the vessel. The Board, however, assumed jurisdiction over an unfair labor practice complaint, issued against the union by the same Regional Director, charging that the picketing violated § 8(b)(4) (A) of the Act.
2
That was the conclusion of the Minnesota Supreme Court in a situation similar to this one. An American union and a Canadian union picketed the dock of an American grain company to prevent the loading and unloading of vessels owned by a Canadian company, which had served notice that it would cease to recognize the Canadian union as bargaining representative for its crews. In a suit by the grain company against both unions, the Minnesota Supreme Court concluded that the state courts had no jurisdiction over the dispute which was governed by the Federal Act. 'This action is directed not against the relationship between the Canadian Company and its employes or its relationship with the Canadian Union, but against acts of defendants done in the United States, and neither seeks to regulate the relationship between the Canadian Company and its employes or the Canadian Company and the Canadian Union.' Norris Grain Co. v. Seafarers' International Union, 232 Minn. 91, 109, 46 N.W.2d 94, 104.
| 67
|
353 U.S. 112
77 S.Ct. 685
1 L.Ed.2d 693
UNITED STATES of America, Petitioner,v.UNION PACIFIC RAILROAD CO.
No. 97.
Argued Jan. 23, 1957.
Decided April 8, 1957.
Mr. J. Lee Rankin, Sol. Gen., Washington, D.C., for petitioner.
Mr. William W. Clary, Los Angeles, Cal., for respondent.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
This is an action brought in the District Court by the United States to enjoin the Union Pacific Railroad Company from drilling for oil and gas on 'the right of way' granted it by § 2 of the Act of July 1, 1862, 12 Stat. 489, 491, for the construction of a railroad and telegraph line. The claim of the United States is that 'the right of way' granted by the Act is not a grant that includes mineral rights. The District Court's decision was adverse to the United States. 126 F.Supp. 646. The Court of Appeals affirmed. 230 F.2d 690. The case is here on a petition for a writ of certiorari which we granted in view of the public importance of the question presented. 352 U.S. 818, 77 S.Ct. 34, 1 L.Ed.2d 44.
2
The 'right of way' which was granted by § 2 of the Act was 'for the construction of said railroad and telegraph line.' As an aid to the construction of the railroad, 'every alternate section of public land' on each side of the road was also granted. § 3. Section 3 further provided 'That all mineral lands shall be excepted from the operation of this act * * *.' (Italics added.)
3
On the face of the Act it would seem that the use of the words 'the right of way' describes a lesser interest than the grant of 'public land.' Moreover, this right of way was granted Union Pacific 'for the construction of said railroad and telegraph line.' § 2. That purpose is not fulfilled when the right of way is used for other purposes. See Northern Pacific R. Co. v. Townsend, 190 U.S. 267, 271, 23 S.Ct. 671, 672, 47 L.Ed. 1044. It would seem that, whatever may be the nature of Union Pacific's interest in the right of way, drilling for oil on or under it is not a railroad purpose within the meaning of § 2 of the Act.1
4
It would also seem from the words of the Act that, whatever rights may have been included in 'the right of way,' mineral rights were excepted by reason of the proviso in § 3 excepting 'mineral lands.' The exception of 'mineral lands,' as applied to the right of way, may have been an inept way of reserving mineral rights. The right of way certainly could not be expected to take all the detours that might be necessary were it to avoid all lands containing minerals. But that the proviso applies to § 2 as well as to § 3 is plain. While the grant of 'the right of way' is made by § 2 and the exception of 'mineral lands' is contained in § 3, the exception extends not merely to § 3 but to the entire Act.
5
It is said that the exception in § 3 was in terms made applicable to the entire Act merely to leave no doubt that land grants to other railroads, contained in §§ 9, 13 and 14 of the Act, were not to include 'mineral lands.' But the exception in § 3 is not limited merely to a few enumerated sections any more than it is limited to § 3. The proviso makes sense if it is read to reserve all mineral rights under the right of way, as well as to reserve mineral lands in the alternate sections of public land granted in aid of the construction of the road. Indeed, we can see no other way to construe it if it is to apply, as it does, not merely to § 3, but to the entire Act, including § 2 which grants the right of way.
6
The reservation of the mineral resources of these public lands for the United States was in keeping with the policy of the times. The gold strike in California in 1848 made the entire country conscious of the potential riches underlying the western part of the public domain. The method of asserting federal control over mineral lands was not finally settled until the Act of July 26, 1866, 14 Stat. 251, prescribed the procedure by which mineral lands could be acquired. But meanwhile—from 1849 to 1866—the federal policy was clear. As the Court said in Ivanhoe Mining Co. v. Keystone Consolidated Mining Co., 102 U.S. 167, 26 L.Ed. 126, the federal policy during this interim period was to reserve mineral lands, not to grant them. The policy was found to be so 'uniform' in this interim period (id., 102 U.S. page 175) that the Court, in construing an 1853 Act governing public lands in California, held that a grant to California did not include mineral lands, although they were not specifically excepted.
7
The case is much stronger here, for 'mineral lands' are specifically reserved. It is, therefore, wholly in keeping with the federal policy that prevailed in 1862, when the present right of way was granted, to construe 'mineral lands' to include mineral resources under the right of way. For it was the mineral riches in the public domain that Congress sedulously sought to preserve until it formulated the special procedure by which all mineral resources were to be administered. In United States v. Sweet, 245 U.S. 563, 38 S.Ct. 193, 62 L.Ed. 473, Mr. Justice Van Devanter, our foremost expert on public land law, discussed this policy at length and cited in support of this federal policy the very Act we have under consideration in the present case. Id., 245 U.S. at page 569, note 1, 38 S.Ct. at page 194, note 3. And see Barden v. Northern Pacific R. Co., 154 U.S. 288, 317—318, 14 S.Ct. 1030, 1034, 38 L.Ed. 992. We would have to forget history and read legislation with a jaundiced eye to hold that when Congress granted only a right of way and reserved all 'mineral lands' it nonetheless endowed the railroad with the untold riches underlying the right of way. Such a construction would run counter to the established rule that land grants are construed favorably to the Government, that nothing passes except what is conveyed in clear language, and that if there are doubts they are resolved for the Government, not against it. Caldwell v. United States, 250 U.S. 14, 20—21, 39 S.Ct. 397, 398, 63 L.Ed. 816. These are the reasons we construe 'mineral lands' as used in § 3 of the Act to include mineral rights in the right of way granted by § 2.
8
The system which Congress set up to effectuate its policy of reserving mineral resources in the alternate sections of public land granted by § 3 was by way of an administrative determination, prior to issuance of a patent, of the mineral or nonmineral character of the lands. Patents were not issued to land administratively determined to constitute mineral lands. And, the administrative determination was final. Burke v. Southern Pacific R. Co., 234 U.S. 669, 34 S.Ct. 907, 58 L.Ed. 1527. Such an administrative system was obviously inappropriate to the right of way granted by § 2. The land needed for the right of way was not acquired through the issuance of a patent, but by the filing of a map showing the definite location of the road, followed by its actual construction. Northern Pacific R. Co. v. Townsend, supra, 190 U.S. at page 270, 23 S.Ct. at page 672.
9
A provision for prior administrative determination of which land in the path of the right of way constituted mineral lands would have been inappropriate for another reason. As already noted, the route of the railroad had to be determined by engineering considerations which could not allow for the extensive detours that the avoidance of land containing minerals would make necessary.
10
Because the administrative system, by which the exception of 'mineral lands' was administered in relation to the lands granted by § 3, is inappropriate to the right of way granted by § 2, we are urged to conclude that the exception of 'mineral lands' in § 3 was not intended to apply to § 2. But, construing the grant in § 2 favorably to the Government, as we must, we cannot conclude that Congress meant the policy it expressed, by excepting 'mineral lands' in § 3, to be inapplicable to § 2 in the face of its admonition that the exception is applicable to the entire Act. Nor can we conclude that, because the administrative system, by which mineral resources in the grant of land under § 3 were reserved, was inappropriate to § 2, Congress did not intend appropriate measures to reserve minerals under the right of way granted by § 2. We cannot assume that the Thirty-seventh Congress was profligate in the face of its express purpose to reserve mineral lands.
11
To be sure, Congress later on designed a more precise and articulated system for the separation of subsoil rights from the other rights in the western lands. See, for example, the Act of March 3, 1909, 35 Stat. 844, 30 U.S.C.A. § 81. It would have been better draftsmanship, if, in referring to § 2, Congress had used the words 'mineral rights' instead of 'mineral lands.' Yet it will not do for us to tell the Congress 'We see what you were driving at but you did not use choice words to describe your purpose.'
12
Some reliance is placed on a line of decisions of the Court which describe the rights of way under early railroad land grants as limited fees. These cases were, for the most part, controversies between the railroad and third persons and involved problems so remote from the present one as to be inapt as citations. For example, the leading case raised the question whether third parties could establish valid homesteads on the railroad right of way after the right of way had been located and the tracks laid. Northern Pacific R. Co. v. Townsend, supra. An answer in favor of the railroad on the ground that it had a limited fee could hardly be an adjudication concerning the ownership of mineral resources underlying the right of way in a contest between the United States and the railroad. In only one of the cases cited was the United States a party; and in that case the question did not involve mineral rights but jurisdiction over a person transporting liquor. If the right of way was Indian Country when it crossed an Indian reservation, then a violation of the liquor laws had occurred. The Court held that the right of way was not Indian Country and said in passing that the right of way constituted the fee in the land. Clairmont v. United States, 225 U.S. 551, 556, 32 S.Ct. 787, 788, 56 L.Ed. 1201. We do not stop to examine the other cases2 using like language to describe the railroad's right of way, because in none of them was there a contest between the United States and the railroad-grantee over any mineral rights underlying the right of way. The most that the 'limited fee' cases decided was that the railroads received all surface rights to the right of way and all rights incident to a use for railroad purposes.
13
Great reliance is placed on Great Northern R. Co. v. United States, 315 U.S. 262, 62 S.Ct. 529, 86 L.Ed. 836, for the view that the grant of a right of way in the year 1862 was the grant of a fee interest. In that case we noted that a great shift in congressional policy occurred in 1871: that after that period only an easement for railroad purposes was granted, while prior thereto a right of way with alternate sections of public land along the right of way had been granted. In the latter connection we said, 'When Congress made outright grants to a railroad of alternate sections of public lands along the right of way, there is little reason to suppose that it intended to give only an easement in the right of way granted in the same act.' Id., 315 U.S. at page 278, 62 S.Ct. at page 536. But we had no occasion to consider in the Great Northern case the grant of a right of way with the reservation of 'mineral lands.' The suggestion that a right of way may at times be more than an easement was made in an effort to distinguish the earlier 'limited fee' cases. To complete the distinction, Mr. Justice Murphy with his usual discernment added, 'None of the cases involved the problem of rights to subsurface oil and minerals.' Id., 315 U.S. 278, 62 S.Ct. 536.
14
The latter statement goes to the heart of the matter. There are no precedents which give the mineral rights to the owner of the right of way as against the United States. We would make a violent break with history if we construed the Act of 1862 to give such a bounty. We would, indeed, violate the language of the Act itself. To repeat, we cannot read 'mineral lands' in § 3 as inapplicable to the right of way granted by § 2 and still be faithful to the standard which governs the construction of a statute that grants a part of the public domain to private interests.
15
Reversed.
16
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
17
Mr. Justice FRANKFURTER, whom Mr. Justice BURTON and Mr. Justice HARLAN join, dissenting.
18
This is a suit by the United States to restrain respondent railroad company from removing oil and gas from the land forming respondent's right of way and to quiet title to those mineral deposits in the United States. The controversy arises out of the Act of July 1, 1862, 12 Stat. 489, the purpose of which is described by its title 'An Act to aid in the Construction of a Railroad and Telegraph Line from the Missouri River to the Pacific Ocean, and to secure to the Government the Use of the same for Postal, Military, and Other Purposes.' The Government claimed that § 2 of that Act, in granting respondent's predecessor in title 'the right of way through the public lands' for the construction of a railroad, did not vest the railroad with any interest in the underlying minerals. The District Court for the District of Wyoming granted judgment for respondent. It held that the Act of 1862 'granted to Union Pacific a fee simple determinable, sometimes called a base, qualified or limited fee, of the lands contained within the right of way, subject only to an implied condition of reverter in the event that Union Pacific ceases to use the right of way,' and that this gave Union Pacific sole right to the underlying minerals, which had not been reserved by the United States. 126 F.Supp. 646. The Court of Appeals for the Tenth Circuir affirmed this judgment. 230 F.2d 690.
Section 2 of the Act of 1862 provides:
19
'And be it further enacted, That the right of way through the public lands be, and the same is hereby, granted to said company for the construction of said railroad and telegraph line; and the right, power, and authority is hereby given to said company to take from the public lands adjacent to the line of said road, earth, stone, timber, and other materials for the construction thereof; said right of way is granted to said railroad to the extent of two hundred feet in width on each side of said railroad where it may pass over the public lands, including all necessary grounds for stations, buildings, workshops, and depots, machine shops, switches, side tracks, turntables, and water stations. The United States shall extinguish as rapidly as may be the Indian titles to all lands falling under the operation of this act and required for the said right of way and grants hereinafter made.'
20
As additional aid toward construction of the line, § 3 granted the railroad five alternate sections of public land per mile on each side of the road, with the qualification that 'all mineral lands shall be excepted from the operation of this act.' And §§ 5 and 11 provided for the issuance to the company, upon its completion of a prescribed number of miles of track, of United States bonds of an aggregate value of not less than $16,000 nor more than $48,000 per mile, depending on the difficulty of the terrain. Two years later, Congress amended the Act to double the number of alternate sections of land granted in aid of construction, 13 Stat. 356.
21
This Act of 1862 was one of a series of statutes providing assistance to individually named railroads to promote their construction. The Act of July 2, 1864, 13 Stat. 365, gave an even greater amount of land to the Northern Pacific Railroad Company, and in 1866 other Acts were passed for the benefit of the St. Joseph and Denver City Railroad Company, 14 Stat. 210; the Kansas and Neosho Valley Railroad Company, 14 Stat. 236; the California and Oregon Railroad Company, 14 Stat. 239; the southern branch of the Union Pacific Company, 14 Stat. 289; and the Atlantic and Pacific Railroad Company, 14 Stat. 292. Each of these statutes contained a grant substantially identical with that made by § 2 of the Act of 1862, the object of our immediate concern.
22
Section 2 was, on the face of it, a specific grant contained in a specific statute designed to achieve a specific, contemporaneous goal—construction of a railroad. Unlike constitutional provisions such as the Due Process Clause or enactments such as the Sherman Law, 15 U.S.C.A. §§ 1—7, 15 note, that embody a felt rather than defined purpose and necessarily look to the future for the unfolding of their content, making of their judicial application an evolutionary process nourished by relevant changing circumstances, a specific grant like § 2 does not gain meaning from time. Its scope today is what it was in 1862, and the judicial task is to ascertain what content was conveyed by that section in 1862. Did the Thirty-seventh Congress grant the entire present interest, the fee, in the land forming the right of way, or did it convey merely a right of passage, an easement, retaining for the United States all other rights in the land, including the right to its minerals?
23
In a line of decisions going back to St. Joseph & D. C. Railroad Co. v. Baldwin, 103 U.S. 426, 26 L.Ed. 578, this Court has consistently recognized that the Act of 1862 and its companion Acts gave to the railroads the entire present interest in the public lands allocated to them for a right of way. In the Baldwin case, the Court dealt with the grant of the right of way to the St Joseph & Denver Railroad under one of the 1866 statutes, 14 Stat. 210. It stated that
24
'* * * the grant of the right of way * * * contains no reservations or exceptions. It is a present absolute grant, subject to no conditions except those necessarily implied, such as that the road shall be constructed and used for the purposes designed. Nor is there anything in the policy of the government with respect to the public lands which would call for any qualification of the terms.' Id., 103 U.S. at pages 429—430.
25
A similar grant of the right of way, in an 1866 grant to the southern branch of the Union Pacific Company, 14 Stat. 289, was repeatedly characterized in Missouri, K. & T.R. Co. v. Roberts, 152 U.S. 114, 14 S.Ct. 496, 38 L.Ed. 377, as being 'absolute in terms, covering both the fee and possession.' Id., 152 U.S. at page 117, 14 S.Ct. at page 497. In Territory of New Mexico v. United States Trust Co., 172 U.S. 171, 181—182, 19 S.Ct. 128, 132, 43 L.Ed. 407, the Court acknowledged that the term 'right of way' had two distinct meanings: (1) a 'mere right of passage;' and (2) "that strip of land which railroad companies take upon which to construct their roadbed.' That is, the land itself—not a right of passage over it.' The Court held that the right of way granted to the Atlantic & Pacific Railroad by another of the 1866 Acts, 14 Stat. 292, was of the latter class, relying on the Roberts case.
26
Northern Pacific R. Co. v. Townsend, 190 U.S. 267, 23 S.Ct. 671, 47 L.Ed. 1044, made even more plain the Court's review that when Congress in the 1860's granted a railroad right of way it conveyed the entire present interest in the strip of land. This was a suit by the railroad against one whose predecessors in title had, after the road was constructed, begun adverse possession of part of the right of way and had subsequently obtained homestead patents to the section of land over which the road passed. Mr. Justice White began the Court's opinion by stating:
27
'At the outset, we premise that, as the grant of the right of way, the filing of the map of definite location, and the construction of the railroad within the quarter section in question preceded the filing of the homestead entries on such section, the land forming the right of way therein was taken out of the category of public lands subject to pre-e mption and sale, and the land department was therefore without authority to convey rights therein. It follows that the homesteaders acquired no interest in the land within the right of way because of the fact that the grant to them was of the full legal subdivisions.' Id., 190 U.S. at page 270, 23 S.Ct. at page 672.
28
The Court then went on to hold that the right of way granted by the Act of 1864 gave the railroad 'a limited fee, made on an implied condition of reverter in the event that the company ceased to use or retain the land for the purpose for which it was granted' and that to allow private parties to acquire part of this land by adverse possession would defeat Congress' plainly manifested desire that the entire right of way continue to be the grantee's so long as the railroad was maintained.
29
All later opinions of the Court concerning the railroad statutes of the '60's express an undeviating adherence to the scope given to this grant as announced by the Baldwin case, supra, in 1881. E.g., Northern Pacific R. Co. v. Ely, 197 U.S. 1, 6, 25 S.Ct. 302, 303, 49 L.Ed. 639; Clairmont v. United States, 225 U.S. 551, 556, 32 S.Ct. 787, 788, 56 L.Ed. 1201; Union Pacific R. Co. v. Laramie Stock Yards, 231 U.S. 190, 198, 34 S.Ct. 101, 102, 58 L.Ed. 179; Missouri, K. & T.R. Co. v. State of Oklahoma, 271 U.S. 303, 308, 46 S.Ct. 517, 519, 70 L.Ed. 957.
30
This consistent course of construction is bound to give the impression that Congress was rather free-handed in its disposition of the public domain ninety years and more ago. And so it was. We said in Great Northern R. Co. v. United States, 315 U.S. 262, 273, 62 S.Ct. 529, 533, 86 L.Ed. 836:
31
'Beginning in 1850 Congress embarked on a policy of subsidizing railroad construction by lavish grants from the public domain. Typical were the Illinois Central Grant, Act of September 20, 1850, c. 61, 9 Stat. 466; Union Pacific Grant of July 1, 1862, c. 120, 12 Stat. 489; Amended Union Pacific Grant, Act of July 2, 1864, c. 216, 13 Stat. 356; and Northern Pacific Grant, Act of July 2, 1864, c. 217, 13 Stat. 365. This last grant was the largest, involving an estimated 40,000,000 acres. In view of this lavish policy of grants from the public domain it is not surprising that the rights of way conveyed in such land-grant acts have been held to be limited fees. Northern Pacific Ry. Co. v. Townsend, 190 U.S. 267, 23 S.Ct. 671, 47 L.Ed. 1044. Cf. Missouri, K. & T. Ry. Co. v. Roberts, 152 U.S. 114, 14 S.Ct. 496, 38 L.Ed. 377.'1
32
During this period 'there passed into the hands of western railroad promoters and builders a total of 158,293,000 acres, an area almost equaling that of the New England states, New York and Pennsylvania combined.' 'Land Grants,' 9 Encyclopedia of the Social Sciences (1935) 32, 35. The powerful Thaddeus Stevens, himself the proponent of the Northern Pacific bill, spoke with authoritative truthfulness when he said of the House Committee that approved it: 'the committee was willing to give to the company almost any amount (of land) that it thought it could make use of * * *.' in order to induce construction of the railroad. Cong. Globe, 38th Cong., 1st Sess. 1698.2
33
This 'lavish' congressional policy brought results, for in 1869 the much desired transcontinental route was completed. With realization of the goal, however, the mood of uncritical enthusiasm toward railroad enterprises began to veer. The Court summarized the consequences of this shift in popular feeling in the Grant Northern case:
34
'This policy (of 'lavish grants from the public domain') incurred grant public disfavor, which was crystallized in the following resolution adopted by the House of Representatives on March 11, 1872:
35
"Resolved, That in the judgment of this House the policy of granting subsidies in public lands to railroads and other corporations ought to be discontinued, and that every consideration of public policy and equal justice to the whole people requires that the public lands should be held for the purpose of securing homesteads to actual settlers, and for educational purposes, as may be provided by law.' Cong. Globe, 42d Cong., 2d Sess., 1585 (1872). After 1871 outright grants of public lands to private railroad companies seem to have been discontinued. But, to encourage development of the Western vastnesses, Congress had to grant rights to lay track across the public domain, rights which could not be secured against the sovereign by eminent domain proceedings or adverse user. For a time special acts were passed granting to designated railroads simply 'the right of way' through the public lands of the United States. That those acts were not intended to convey any land is inferable from remarks in Congress by those sponsoring the measures. * * *
36
'The burden of this special legislation moved Congress to adopt the general right of way statute now before this Court * * *.' 315 U.S. at pages 273—275, 62 S.Ct. at pages 533—534 (footnotes omitted).
37
The General Right of Way Statute of 1875, 18 Stat. 482, 43 U.S.C.A. § 934 et seq., was significantly different from the Act of 1862 and its companions. It granted the railroads neither alternate sections of public land nor direct financial subsidy. The right of way provided for was half the width of that given by the 1862 and 1864 laws. And § 2 of the Act stated that any railroad whose right of way ran through a canyon, pass or defile 'shall not prevent any other railroad company from the use and occupancy of the said canyon, pass, or defile, for the purposes of its road, in common with the road first located * * *.' Moreover, § 4 required the recipient of each right of way to note its location on the plats in the local land office, and provided that 'thereafter all such lands over which such right of way shall pass shall be disposed of subject to such right of way * * *.'
38
Detailed study of the history of federal right of way legislation led us to conclude in the Great Northern case that a right of way granted by the 1875 Act was an easement and not a limited fee.3 From this it followed that the railroad had no right to the underlying minerals. Basic to the Court's characterization of the right of way as an easement was the recognition that 'Since it (the General Right of Way Statute) was a product of the sharp change in Congressional policy with respect to railroad grants after 1871, it is improbable that Congress intended by it to grant more than a right of passage, let alone mineral riches.' Id., 315 U.S. at page 275, 62 S.Ct. at page 534. The change in congressional policy was found to be reflected in the language of the statute, which strongly suggested the grant of a right of use and occupancy only. Especially persuasive was the provision of § 4 that 'lands over which such right of way shall pass shall be disposed of subject to such right of way.' Id., 315 U.S. at pages 271, 278, 6i S.Ct. at pages 532, 536. Legislative history and substantially contemporaneous administrative construction confirmed this view.4 These strong differentiating factors led the Court to conclude that the line of cases interpreting the lavish pre-1871 grants was not controlling. But no doubt was cast upon the scope to be attributed to those decisions with respect to the Act of 1862 and its associated measures: 'When Congress made outright grants to a railroad of alternate sections of public lands along the right of way, there is little reason to suppose that it intended to give only an easement in the right of way granted in the same act. And in none of those acts was there any provision comparable to that of § 4 of the 1875 Act * * *.' Id., 315 U.S. at page 278, 62 S.Ct. at page 536.
39
The significance of the imposing body of opinions culminating in the Townsend case is not diminished if one acknowledges, as was done in Great Northern, that they did not explicitly decide the rights to minerals. As we have seen, in case after case this Court determined the railroad's interest in the right of way granted by the pre-1871 laws to be a limited fee. This term has a settled meaning—it denotes present ownership of the entire interest in land, an ownership that will continue so long as a stated contingency, leading to a reverter, does not occur. The Court's repeated use of this highly technical term was not inadvertent. In the United States Trust Co. case, for example, in reply to the contention that the Roberts case was not controlling because the distinction between an easement and a fee had not been presented there, the Court said:
40
'* * * The difference between an easement and the fee would not have escaped his (Mr. Justice Field's) attention and that of the whole court, with the inevitable result of committing it to the consequences which might depend upon such difference.' 172 U.S. at page 182, 19 S.Ct. at page 132.
41
The Court then went on to hold that one of the consequences of the railroad's fee interest in the right of way, i.e., its ownership of 'the land itself,' was exemption from state taxation of improvements erected thereon. Another of those consequences, of course, is ownership of the minerals underlying the right of way. Certainly this was acknowledged in Townsend when the Court held that the land forming the right of way was no longer public land and that, consequently, the Land Department was 'without authority to convey rights therein' and those claiming under government patents 'acquired no interest in the land within the right of way.' See 353 U.S. 124, 77 S.Ct. 691. If mineral rights had not been included in the fee, the patents issued by the United States would have conveyed those rights. The legal consequence that mineral rights are embraced in a grant that conveys a limited fee governed the judgment of two federal courts that were called upon to construe a similar grant made to the Illinois Central by the Act of 1850, 9 Stat. 466. United States v. Illinois Central R. Co., 89 F.Supp. 17, affirmed 7 Cir., 187 F.2d 374.5 To argue that the 'limited fee' that the long, unbroken line of cases found in the right of way grant in these enactments of the '60's granted a fee merely in the surface is to palter with language and with our decisions. 'Surface' could not, of course, mean merely the area that is seen by the eye. To say that it means the visual area and an indeterminate depth—x inches or x feet—necessary for support is to ask the Court to rewrite legislation and to cast upon it administrative tasks in order to accomplish a policy that seems desirable a hundred years after Congress acted on a different outlook. No wonder that this Court did not accept such an inadmissible retrospective reading of a statute when the Government pressed it on us in the Great Northern case. See Argument for the United States, 315 U.S. at page 269.
42
The Townsend case also serves to refute the suggestion that the railroad in its use of the right of way is confined to what in 1957 is narrowly conceived to be 'a railroad purpose.' Townsend flatly reaffirmed what its predecessors stated—that the grant should be construed 'as though the land had been conveyed in terms to have and to hold the same so long as it was used for the railroad right of way.' 190 U.S. at page 271, 23 S.Ct. at page 672. The Court recognized that the land could revert to the grantor only in the event that it was used in a manner inconsistent with the operation of the railroad, a situation contrary to that found by the District Court in this case. Had Congress desired to make a more restrictive grant of the right of way, there would have been no difficulty in making the contingency for the land's reversion its use for any purpose other than one appropriately specified. Cf. Caldwell v. United States, 250 U.S. 14, 39 S.Ct. 397, 63 L.Ed. 816; Los Angeles & Salt Lake R. Co. v. United States, 9 Cir., 140 F.2d 436. But, as we have seen, the congressional policy in 1862 was one of liberality, prodigality as it later came to appear, in order to encourage the construction of the railroad. It is inconceivable that the Congress that made generous loans to the Union Pacific and granted it enormous areas of land for resale at substantial gain would have balked at its profitable resort to the minerals underneath the right of way in a manner completely consistent with the satisfactory operation of the railroad. Further support for this view is provided by § 3 of the 1864 amendment to the Act before us. It gave the railroad power to take by eminent domain a two-hundred-foot right of way over privately owned land, and demonstrates that, in granting four-hundred-foot strips of public land to Union Pacific and Northern Pacific Congress pursued a conscious policy of providing these railroads with more land than was necessary merely to provide a site for their construction. As the Baldwin case recognized, 'The right of way for the whole distance of the proposed route was a very important part of the aid given.' 103 U.S. at page 430. Out of respect for the generous policy embodied in pre-1871 legislation, this Court has until today recognized the railroad's right to enjoy its fee interest in the right of way. See Northern Pacific R. Co. v. Smith, 171 U.S. 260, 275—276, 18 S.Ct. 794, 799, 43 L.Ed. 157.
43
It is said that § 3's exception of 'mineral lands' from its grant of alternate sections of public land may also have been an inept way of reserving the rights to the minerals underneath the right of way granted by § 2. This attributes to the 1862 Congress a desire to convey only the fee interest in the surface. Such attribution contradicts the scheme both of the Act itself and of subsequent public land legislation. The Act plainly contemplated, and was interpreted to provide, an administrative determination of the mineral character of the land granted by § 3 prior to the issuance of the patent. Land found to be 'mineral' was not patented but was replaced by other land. If minerals were subsequently found on patented land, they were held to belong to the railroad, and not to the Government, Burke v. Southern Pacific R. Co., 234 U.S. 669, 34 S.Ct. 907, 58 L.Ed. 1527, notwithstanding § 3's exception of 'mineral lands.' Since this exception did not reserve the right to minerals in land that passed under § 3 itself, it is difficult to understand how it could have reserved the right to minerals in land that passed as a right of way under § 2. The fact that the exception was made applicable to the entire Act may be explained without distorting § 2. Sections 9, 13, and 14 of the 1862 Act authorize construction of certain other railroads 'upon the same terms and conditions in all respects as are provided in this act for the construction of the' Union Pacific. By amending § 3's proviso to cover the entire Act, Congress left no doubt that the exception of mineral lands also applied to the land grants made to those other railroads.
44
If Congress had reserved the right to the minerals underlying the thousands of miles of right of way granted by its transcontinental railroad legislation of 1862, 1864 and 1866, it might reasonably be expected that it would have manifested some consciousness of this reservation when, in the Act of July 26, 1866, 14 Stat. 251, it finally settled upon a general federal mineral policy. This is particularly true in view of the fact that the policy determined was not one of zealously reserving the minerals for the Government but one of making the country's mineral riches readily available for immediate development by private interests. Section 1 of the Act provided 'That the mineral lands of the public domain * * * are hereby declared to be free and open to exploration and occupation * * *.' Other sections set forth the conditions for acquiring mineral lands. Yet nowhere in the Act is there intimation of government ownership of the mineral rights now found, for the first time, to have been reserved by Congress in its grants to the railroads in the 1860's.
45
This failure of Congress to provide for disposition of the minerals lying beneath the right of way may not fairly be attributed to oversight. No congressional policy of reserving mineral rights from public land grants was in existence in the 1860's. Such a policy did not begin to evolve until the last decade of the nineteenth century, when Congress reserved the mineral rights to certain lands sold to cities for cemetery and park purposes, 26 Stat. 502, 43 U.S.C.A. § 729. And it received its first general application in the Act of March 3, 1909, 35 Stat. 844, 30 U.S.C.A. § 81, which permitted agricultural entrymen on public lands subsequently found to contain coal deposits to obtain patents to the land, with coal rights reserved to the United States. The novelty of thus separating surface ownership from ownership of the subsoil was made plain by a colloquy in the House debate on this Act:
46
'Mr. Stephens of Texas. I desire to know the difference between this law which the gentleman proposes and the law as it now exists. What change is proposed, and why?
47
'Mr. Mondell (of Wyoming, Chairman of the House Public Lands Committee). * * * This bill simply provides that in any case where, subsequent to the location or the entry, the character of the land has been called into question the entryman may, if he so elect, accept a limited patent. It is the first legislation before Congress providing for a limited patent, or a patent reserving the mineral * * *.
48
'Mr. Stephens of Texas. Is it not a fact that valuable minerals are reserved now to the Government?
49
'Mr. Mondell. No; that is not true. The patent having issued, the patent carries everything in the land with it. * * *
50
'In other words, the patents issued by the Government of the United States heretofore have been patents in fee.' 43 Cong.Rec. 2504.6
51
In 1910 the Act was extended to provide for issuance of patents to lands that were known to contain coal at the time they were settled for agricultural purposes. 36 Stat. 583, 30 U.S.C.A. § 83 et seq. The Surface Patent Act of 1914, 38 Stat. 509, 30 U.S.C.A. § 121 et seq., applied the statutory policy with respect to coal to all withdrawn non-metallic mineral lands. This Act has been described as 'perhaps the first serious attempt, not locally limited, to sever the surface title from the mineral title in disposing of the public domain.' Morrison and De Soto, Oil and Gas Rights, 508. It was followed by the Stock-Raising Homestead Act of 1916, 39 Stat. 862, 43 U.S.C.A. § 291 et seq., which reserved all minerals to the United States while providing for the granting of surface patents. Significantly, in the comprehensive Mineral Leasing Act of 1920, 41 Stat. 437, 30 U.S.C.A. §§ 22, 48, 181 et seq., Congress did what it had not done in 1866—it set forth a plan for the development of the minerals that the 1909—1916 Acts had reserved for the United States.
52
The Thirty-seventh Congress was confronted with what it deemed the pressing need to stimulate the rapid construction of a transcontinental railroad. In the Act of 1862 it offered the Union Pacific luring incentives to attempt this task, which 'many intelligent persons considered insurmountable.' United States v. Union Pacific R. Co., 91 U.S. 72, 80, 23 L.Ed. 224. The specific grant contained in § 2 has long been interpreted as conveying the entire present interest in the land forming the right of way. This body of opinions, written by members of the Court more steeped in public land law and more sensitive to the circumstances of the times than we can possibly be, seems to me to constitute too weighty a construction of § 2 to be now overturned. It is of course the Court's duty to enforce the will of Congress once that has been reasonably ascertained from the language in which Congress expressed its will. But the ascertainment of what Congress meant from what it said, in legislation like that before the Court, does not gain clarity with time so as to displace the uniform construction put by this Court from the beginning, almost eighty years, ago, on what Congress said. The Court cannot in 1957 retrieve what Congress granted in 1862. The hindsight that reveals the Act as lavish or even profligate ought not to influence the Court to narrow the scope of the 1862 grant by reading it in the light of a policy that did not mature until half a century thereafter. As the Court said in a very early construction of the Act before us: 'No argument can be drawn from the wisdom that comes after the fact.' United States v. Union Pacific R. Co., supra, 91 U.S. at page 81.
53
I would affirm the judgment of the Court of Appeals.
1
To that effect are administrative decisions, by officers of the Interior Department dealing with comparable statutes, that a congressional grant of land 'for railroad purposes' does not carry the right to drill for oil or to remove solid minerals. Missouri, Kansas & Texas R. Co., 33 L.D. 470, Act of July 26, 1866, 14 Stat. 289; Missouri, Kansas & Texas R. Co., 34 L.D. 504, Act of February 28, 1902, 32 Stat. 43; Use of Railroad Right of Way for Extracting Oil, 56 I.D. 206, Act of March 3, 1875, 18 Stat. 482, 43 U.S.C.A. § 934 et seq.; Northern Pacific R. Co., 58 I.D. 160, Act of July 2, 1864, 13 Stat. 365.
2
St Joseph & D. C. Railroad Co. v. Baldwin, 103 U.S. 426, 26 L.Ed. 578 (a contest between the owner of the right of way and a settler who took possession before the line was definitely located); Missouri, K. & T.R. Co. v. Roberts, 152 U.S. 114, 14 S.Ct. 496, 38 L.Ed. 377 (a contest between the owner of the right of way and one who claimed the land under a grant from the State); Territory of New Mexico v. United States Trust Co., 172 U.S. 171, 19 S.Ct. 128, 43 L.Ed. 407 (an effort by the State to tax the right of way and structures on it in face of an exemption granted by Congress); Union Pac. R. Co. v. Laramie Stock Yards, 231 U.S. 190, 34 S.Ct. 101, 58 L.Ed. 179 (whether the grant of the right of way was qualified by a later Act of Congress); Rio Grande Western R. Co. v. Stringham, 239 U.S. 44, 36 S.Ct. 5, 60 L.Ed. 136 (a contest between the owner of the right of way and the owner of a placer patent); Choctaw, O & G.R. Co. v. Mackey, 256 U.S. 531, 41 S.Ct. 58i, 65 L.Ed. 1076 (an effort of the owner of the right of way to get an exemption from local taxation for a street improvement that enhanced the value of the railroad use); Missouri, K. & T.R. Co. v. State of Oklahoma, 271 U.S. 303, 46 S.Ct. 517, 70 L.Ed. 957 (the right of the owner of the right of way to compensation for damage suffered by the construction of crossings).
1
The last three sentences quoted were a footnote to the first sentence.
2
When striving to understand the basis for this bountiful congressional policy, it is helpful to recall what this Court said in United States v. Union Pacific R. Co., 91 U.S. 72, 79—80, 23 L.Ed. 224:
'Many of the provisions in the original act of 1862 are outside of the usual course of legislative action concerning grants to railroads, and cannot be properly construed without reference to the circumstances which existed when it was passed. The war of the rebellion was in progress; and, owing to complications with England, the country had become alarmed for the safety of our Pacific possessions. * * * It is true, the threatened danger was happily averted; but wisdom pointed out the necessity of making suitable provision for the future. This could be done in no better way than by the construction of a railroad across the continent. Such a road would bind together the widely separated parts of our common country, and furnish a cheap and expeditious mode for the transportation of troops and supplies. * * *
'* * * Although this road was a military necessity, there were other reasons active at the time in producing an opinion for its completion besides the protection of an exposed frontier. There was a vast unpeopled territory lying between the Missouri and Sacramento Rivers which was practically worthless without the facilities afforded by a railroad for the transportation of persons and property. With its construction, the agricultural and mineral resources of this territory could be developed, settlements made where settlements were possible, and thereby the wealth and power of the United States largely increased; and there was also the pressing want, in time of peace even, of an improved and cheaper method for the transportation of the mails, and of supplies for the army and the Indians.
'It was in the presence of these facts that Congress undertook to deal with the subject of this railroad. The difficulties in the way of building it were great, and by many intelligent persons considered insurmountable.'
These compelling considerations led Congress to offer the Union Pacific Company what Mr. Chief Justice Waite called 'extraordinary inducements.' In re Sinking Fund Cases, 99 U.S. 700, 723, 25 L.Ed. 496, 504.
3
The Great Northern decision departed from the Court's earlier construction of the General Right of Way Statute in Rio Grande Western R. Co. v. Stringham, 239 U.S. 44, 36 S.Ct. 5, 60 L.Ed. 136. The Stringham case, written by Mr. Justice Van Devanter, held, on the basis of the cases dealing with pre-1871 legislation, that right of way granted by the 1875 Act 'is * * * a limited fee, * * * and carries with it the incidents and remedies usually attending the fee.' Id., 239 U.S. at page 47, 36 S.Ct. at page 6.
4
In explaining why the House Public Lands Committee had inserted a clause similar to § 4 of the 1875 Act in a special right of way bill considered in 1872, Congressman Slater stated:
'The point is simply this: the land over which this right of way passes is to be sold subject to the right of way. It simply provides that this right of way shall be an incumbrance upon the land for one hundred feet upon each side of the line of the road; that those who may afterward make locations for settlement shall not interfere with this right of way.
'Mr. Speer, of Pennsylvania. It grants no land to any railroad company?
'Mr. Slater. No, sir.' Cong.Globe, 42d Cong., 2d Sess. 2137.
And in the House debate on the 1875 Act itself, Congressman Hawley said:
'It simply and only gives the right of way. It merely grants to such railroad companies as may be chartered the right to lay their tracks and run their trains over the public lands; it does nothing more.' 3 Cong.Rec. 407.
The earliest administrative construction of the 1875 Act plainly stated that the railroad received an easement rather than a fee. The Land Department circular of January 13, 1888, said:
'The act of March, 3, 1875, (sic) is not in the nature of a grant of lands; it does not convey an estate in fee, either in the 'right of way' or the grounds selected for depot purposes. It is a right of use only, the title still remaining in the United States.' 12 L.D. 423, 428.
5
Apparently this has always been respondent's understanding of the right of way grant, for the District Court found that 'It has long been the practice of the defendant when entering into leases of portions of its right of way to reserve the right to retake possession for mineral operations.'
6
The executive officers who sponsored passage of the 1909 Act recognized that they were advocating a new policy. Secretary of the Interior Garfield's 1907 report to the President stated:
'* * * I can not urge too strongly the need of a change in the policy hitherto adopted by the Government for the disposition of the coal land.
'* * * The experience in other sections of our country and abroad leads me to believe that the best possible method * * * is for the Government to retain the title to the coal, and to lease under proper regulations which will induce development when needed, prevent waste, and prevent monpoly. Such a method permits the separation of the surface from the coal and the unhampered use of the surface for purposes to which it may be adapted.' Report of the Secretary of the Interior 15 (1907), H.R.Doc.No.5, 60th Cong., 1st Sess. 15.
President Theodore Roosevelt's special message to Congress of January 22, 1909, recommended: 'Rights to the surface of the public land should be separated from rights to forests upon it and to minerals beneath it, and these should be subject to separate disposal.' 15 Messages and Papers of the Presidents 7266.
| 78
|
353 U.S. 180
77 S.Ct. 707
1 L.Ed.2d 746
AUTOMOBILE CLUB OF MICHIGAN, Petitioner,v.COMMISSIONER OF INTERNAL REVENUE.
No. 89.
Argued March 6 and 7, 1957.
Decided April 22, 1957.
Rehearing Denied June 3, 1957.
See 353 U.S. 989, 77 S.Ct. 1279.
Messrs. Ellsworth C. Alvord, Washington, D.C., and Raymond H. Berry, Detroit, Mich., for the petitioner.
Mr. John N. Stull, Washington, D.C., for the respondent.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
In 1945, the Commissioner of Internal Revenue revoked his 1934 and 1938 rulings exempting the petitioner from federal income taxes, and retroactively applied the revocation to 1943 and 1944. The Commissioner also determined that prepaid membership dues received by the petitioner should be taken into income in the year received, rejecting the petitioner's method of reporting as income only that part of the dues as was recorded on petitioner's books as earned in the tax year. The Tax Court sustained the Commissioner's determinations,1 and the Court of Appeals for the Sixth Circuit affirmed.2 This Court granted certiorari.3
2
The Commissioner had determined in 1934 that the petitioner was a 'club' entitled to exemption under provisions of the internal revenue laws corresponding to § 101(9) of the Internal Revenue Code of 1939,4 notifying the petitioner that '* * * future returns, under the provisions of section 101(9) * * * will not be required so long as there is no change in your organization, your purposes or methods of doing business.' In 1938, the Commissioner confirmed this ruling in a letter stating: '* * * as it appears that there has been no change in your form of organization or activities which would affect your status the previous ruling of the Bureau holding you to be exempt from filing returns of income is affirmed * * *.' Accordingly the petitioner did not pay federal taxes from 1933 to 1945. The Commissioner revoked these rulings in 1945, however, and directed the petitioner to file returns for 1943 and subsequent years.5 Pursuant to this direction, the petitioner filed, under protest, corporate income and excess profits tax returns for 1943, 1944 and 1945.
3
The Commissioner's earlier rulings were grounded upon an erroneous interpretation of the term 'club' in § 101(9) and thus were based upon a mistake of law. It is conceded that in 1943 and 1944 petitioner was not, in fact or in law, a 'club' entitled to exemption within the meaning of § 101(9), and also that petitioner is subject to taxation for 1945 and subsequent years.6 It is nevertheless contended that the Commissioner had no power to apply the revocation retroactively to 1943 and 1944, and that, in any event, the assessment of taxes against petitioner for 1943 and 1944 was barred by the statute of limitations.
4
The petitioner argues that, in light of the 1934 and 1938 rulings, the Commissioner was equitably estopped from applying the revocation retroactively. This argument is without merit. The doctrine of equitable estoppel is not a bar to the correction by the Commissioner of a mistake of law.7 The decision in Stockstrom v. Commissioner, 88 U.S.App.D.C. 286, 190 F.2d 283, 30 A.L.R.2d 443, to the extent that it holds to the contrary, is disapproved.
5
Petitioner's reliance on H.S.D. Co. v. Kavanagh, 6 Cir., 191 F.2d 831, and Woodworth v. Kales, 6 Cir., 26 F.2d 178, is misplaced because those cases did not involve correction of an erroneous ruling of law. Reliance of Lesavoy Foundation v. Commissioner, 3 Cir., 238 F.2d 589, is also misplaced because there the court recognized the power in the Commissioner to correct a mistake of law, but held that in the circumstances of the case the Commissioner had exceeded the bounds of the discretion vested in him under § 3791(b) of the 1939 Code.8
6
The Commissioner's action may not be disturbed unless, in the circumstances of this case, the Commissioner abused the discretion vested in him by § 3791(b) of the 1939 Code. That section provides:
7
'Retroactivity of regulations or rulings.
8
'The Secretary, or the Commissioner with the approval of the Secretary, may prescribe the extent, if any, to which any ruling, regulation, or Treasury Decision, relating to the internal revenue laws, shall be applied without retroactive effect.'
9
The petitioner contends that this section forbids the Commissioner taking retroactive action. On the contrary, it is clear from the language of the section and its legislative history9 that Congress thereby confirmed the authority of the Commissioner to correct any ruling, regulation or Treasury decision retroactively, but empowered him, in his discretion, to limit retroactive application to the extent necessary to avoid inequitable results.
10
The petitioner, citing Helvering v. R. J. Reynolds Tobacco Co., 306 U.S. 110, 59 S.Ct. 423, 83 L.Ed. 536, argues that resort by the Commissioner to s 3791(b) was precluded in this case because the repeated re-enactments of § 101(9) gave the force of law to the provision of the Treasury regulations relating to that section. These regulations provided that when an organization had established its right to exemption it need not thereafter make a return of income or any further showing with respect to its status unless it changed the character of its operations or the purpose for which it was originally created.10 Helvering v. R. J. Reynolds Tobacco Co. is inapplicable to this case. As stated by the Tax Court: 'The regulations involved there (Helvering v. R. J. Reynolds Tobacco Co.) * * * purported to determine what did or did not constitute gain or loss. The regulations here * * * in nowise purported to determine whether any organization was or was not exempt.'11 These regulations did not provide the exemption or interpret § 101(9), but merely specified the necessary information required to be filed in order that the Commissioner might rule whether or not the taxpayer was entitled to exemption. This is thus not a case of '* * * administrative construction embodied in the regulation(s) * * *' which, by repeated re-enactment of § 101(9), '* * * Congress must be taken to have approved * * * and thereby to have given * * * the force of law.' Helvering v. R. J. Reynolds Tobacco Co., 306 U.S. at pages 114, 115, 59 S.Ct. at page 425.
11
We must, then, determine whether the retroactive action of the Commissioner was an abuse of discretion in the circumstances of this case. The action was the consequence of the reconsideration by the Commissioner, in 1943, of the correctness of the prior rulings exempting automobile clubs, initiated by a General Counsel Memorandum interpreting § 101(9) to be inapplicable to such organizations.12 The Commissioner adopted the General Counsel's interpretation and proceeded to apply it, effective from 1943, indiscriminately to automobile clubs.13 We thus find no basis for disagreeing with the conclusion, reached by both the Tax Court and the Court of Appeals, that the Commissioner, having dealt with petitioner upon the same basis as other automobile clubs, did not abuse his discretion. Nor did the two-year delay in proceeding with the petitioner's case, in these circumstances, vitiate the Commissioner's action.
12
The petitioner's contention that the statute of limitations barred the assessment of deficiencies for 1943 and 1944 is also without merit. Its returns for those years were not filed until October 22, 1945. Within three years, on August 25, 1948, the petitioner and the Commissioner signed consents extending the period to June 30, 1949. The period was later extended to June 20, 1950. Notice of deficiencies was mailed to petitioner on February 20, 1950. The assessments were therefore within time under §§ 275(a) and 276(b)14 unless, as the petitioner asserts, the statute of limitations began to run from the dates when, if there was a duty to file, the statute required filing.15 The petitioner argues that because its omission to file on March 15, 1914, and March 15, 1945, was induced by the Commissioner's 1934 and 1938 rulings, it is only equitable to interpret the statute of limitations as running from those dates in the circumstances of this case. But the express condition prescribed by the Congress was that the statute was to run against the United States from the date of the actual filing of the return, and no action of the Commissioner can change or modify the conditions under which the United States consents to the running of the statute of limitations against it. In Lucas v. Pilliod Lumber Co., 281 U.S. 245, 249, 50 S.Ct. 297, 299, 74 L.Ed. 829, this Court held:
13
'Under the established general rule a statute of limitation runs against the United States only when they assent and upon the conditions prescribed. Here assent that the statute might begin to run was conditioned upon the presentation of a return duly sworn to. No officer had power to substitute something else for the thing specified. * * *'16
14
It is also argued that the Form 990 returns filed by the petitioner in compliance with § 54(f) of the 1939 Code, as amended,17 constituted the filing of returns for the purposes of § 275(a). But the Form 990 returns are merely information returns in furtherance of a congressional program to secure information useful in a determination whether legislation should be enacted to subject to taxation certain tax-exempt corporations competing with taxable corporations.18 Those returns lack the data necessary for the computation and assessment of deficiencies and are not therefore tax returns within the contemplation of § 275(a). Cf. Commissioner of Internal Revenue v. Lane-Wells Co., 321 U.S. 219, 64 S.Ct. 511, 88 L.Ed. 684.
15
The final issue argued concerns the treatment of membership dues and arises because such dues are paid in advance for one year. The dues upon collection are deposited in a general bank account and are not segregated from general funds but are available and are used for general corporate purposes. For bookkeeping purposes, however, the dues upon receipt are credited to an account carried as a liability account and designated 'Unearned Membership Dues.' During the first month of membership and each of the following eleven months one-twelfth of the amount paid is credited to an account designated 'Membership Income.' This method of accounting was followed by petitioner from 1934. The income from such dues reported by petitioner in each of its tax returns for 1943 through 1947 was the amount credited in the year to the 'Membership Income' account. The Commissioner determined that the petitioner received the prepaid dues under a claim of right, without restriction as to their disposition, and therefore the entire amount received in each year should be reported as income. The Commissioner relies upon North American Oil Consolidated v. Burnet, 286 U.S. 417, 424, 52 S.Ct. 613, 615, 76 L.Ed. 1197, where this Court said: 'If a taxpayer receives earnings under a claim of right and without restriction as to its disposition, * * * (it) has received income which (it) is required to return * * *.'
16
The petitioner does not deny that it has the unrestricted use of the dues income in the year of receipt, but contends that its accrual method of accounting clearly reflects its income, and that the Commissioner is therefore bound to accept its method of reporting membership dues. We do not agree. Section 41 of the Internal Revenue Code of 1939 required that '(t)he net income shall be computed * * * in accordance with such method of accounting regularly employed in keeping the books * * * but * * * if the method employed does not clearly reflect the income, the computation shall be made in accordance with such method as in the opinion of the Commissioner does clearly reflect the income. * * *'19 The pro rata allocation of the membership dues in monthly amounts is purely artificial and bears no relation to the services which petitioner may in fact be called upon to render for the member.20 Section 41 vests the Commissioner with discretion to determine whether the petitioner's method of accounting clearly reflects income. We cannot say, in the circumstances here, that the discretionary action of the Commissioner, sustained by both the Tax Court and the Court of Appeals, exceeded permissible limits. See Brown v. Helvering, 291 U.S. 193, 204—205, 54 S.Ct. 356, 361, 78 L.Ed. 725.
17
Affirmed.
18
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
19
Mr. Justice BURTON, whom Mr. Justice CLARK joins, concurring in part and dissenting in part.
20
I join in the Court's opinion insofar as it holds (a) that the Commissioner did not abuse his discretion under § 3791(b) of the Internal Revenue Code of 1939 when, in 1946, he revoked previous rulings exempting petitioner from federal income taxes and directed petitioner to file returns for 1943 and 1944, and (b) that assessment of deficiencies for those years was not barred by the statute of limitations. However, for the reasons stated by Mr. Justice HARLAN, I dissent from the Court's holding that the Commissioner acted within his discretion under § 41 of the Internal Revenue Code of 1939 when he determined, in reliance upon the 'claim of right' doctrine, that petitioner's method of accounting for prepaid membership dues did not clearly reflect its income.
21
Mr. Justice HARLAN, dissenting.
22
I think collection of the 1943 and 1944 taxes, based on the Commissioner's retroactive revocation of his 1934 and 1938 exemption rulings, was barred by the three-year statute of limitations.1 I would hold that the limitations period began to run when the taxpayer, relying on the exemption ruling, duly filed its Form 990 returns2 for the years 1943 and 1944. I see no reason why we should strain to construe 'return' in § 275(a) as excluding an information return when such a return was the only one required of this taxpayer, exempt from taxation at the time, and especially when that construction procedures the inequitable consequences which have resulted here. Section 275(a) should be construed in conjunction with § 276(a),3 which provides that an assessment may be made without regard to the statute of limitations in 'the case of a false or fraudulent return with intent to evade tax or of a failure to file a return * * *.' In my judgment, a taxpayer who files a return on one form rather than another because the Commissioner directs him to do so cannot be charged with the 'failure' contemplated by the statute. See Stockstrom v. Commissioner, 88 U.S.App.D.C. 286, 190 F.2d 283, 30 A.L.R.2d 443; Balkan Nat. Ins. Co. v. Commissioner, 2 Cir., 101 F.2d 75. Commissioner of Internal Revenue v. Lane-Wells Co., 321 U.S. 219, 64 S.Ct. 511, 88 L.Ed. 684, cited by the Court, is inapposite because the taxpayer there was required by applicable statutes and regulations to file two returns and had filed only one. Compare Germantown Trust Co. v. Commissioner, 309 U.S. 304, 60 S.Ct. 566, 84 L.Ed. 770. Under the decision of the Court, the Commissioner may revoke his rulings retroactively so long as his action does not constitute an 'abuse of discretion.' I see no reason why that power should not also be subjected to the three-year limit established by Congress.
23
I also disagree with the Court's holding that the Commissioner may properly tax in the year of receipt the full amount of petitioner's prepaid membership dues. The Commissioner seeks to justify that course under the 'claim of right' doctrine announced in North American Oil Consolidated v. Burnet, 286 U.S. 417, 52 S.Ct. 613, 76 L.Ed. 1197. However, that doctrine, it seems to me, comes into play only in determining whether the treatment of an item of income should be influenced by the fact that the right to receive or keep it is in dispute; it does not relate to the entirely different question whether items that admittedly belong to the taxpayer may be attributed to a taxable year other than that of receipt in accordance with principles of accrual accounting. See Brown v. Helvering, 291 U.S. 193, 54 S.Ct. 356, 78 L.Ed. 725, where these two problems were involved and were treated as distinct. The collection of taxes clearly should not be made to depend on the vicissitudes of litigation with third parties in which the taxpayer may be engaged. That is quite a different thing, however, from holding that the Commissioner may force taxpayers to abandon reasonable and accurate methods of accounting simply because they do not reflect advance receipts as income in the year received. Under § 41 of the Internal Revenue Code of 1939,4 the income of the taxpayer is to be determined 'in accordance with the method of accounting regularly employed in keeping the (taxpayer's) books,' unless 'the method employed does not clearly reflect' the taxpayer's income. Under § 42,5 items of gross income need not be reported in the taxable year in which received by the taxpayer if, 'under methods of accounting permitted under section 41, any such amounts are to be properly accounted for as of a different period.' And it is clear that accrual methods of accounting may be employed. United States v. Anderson, 269 U.S. 422, 46 S.Ct. 131, 70 L.Ed. 347. The Commissioner's own regulations authorize the deferral of income in some instances.6
24
The Court, however, now by-passes the Commissioner's 'claim of right' argument, and rests its decision instead on the ground that the 'pro rata allocation of the membership dues in monthly amounts is purely artificial and bears no relation to the services which petitioner may in fact be called upon to render for the member,' so that it cannot say that in doing what he did the Commissioner exceeded the limits of his discretion. I do not understand this, because the Commissioner does not deny—as, indeed, he could not—that the method of accounting used by the taxpayer reflects its net earnings with considerably greater accuracy than the method he proposes. Nor does he urge that the taxpayer's accounting system defers income in a manner or to an extent that would make the Government unreasonably dependent on the continued solvency of the taxpayer's business. And no other circumstances have been shown which would justify application of the statutory exception.
25
On both of these grounds I would reverse the judgment below.
1
20 T.C. 1033.
2
230 F.2d 585.
3
352 U.S. 817, 77 S.Ct. 32, 1 L.Ed.2d 44.
4
Section 101(9) provided as follows:
'The following organizations shall be exempt from taxation under this chapter—
The earlier statute sections were identical to the 1939 section. 52 Stat. 480 (1938); 49 Stat. 1673 (1936); 48 Stat. 700 (1934); 47 Stat. 193 (1932).
5
The letter of revocation stated that in order to qualify as a club under § 101(9), the '* * * organization should be so composed and its activities be such that fellowship among the members plays a material part in the life of the organization * * *.' It was then stated that the previous rulings were revoked because '(t)he evidence submitted shows that fellowship does not constitute a material part of the life of * * * (petitioner's) organization and that * * * (petitioner's) principal activity is the rendering of commercial services to * * * (its) members.'
6
Petitioner renders various services for its members. Among these are emergency road service when a car is disabled; furnishing maps, road and other travel information; and publishing a monthly magazine containing news of travel and of laws pertaining to the use of automobiles.
7
Keystone Auto. Club v. Commissioner, 3 Cir., 181 F.2d 402; Schafer v. Helvering, 65 App.D.C. 292, 83 F.2d 317, affirmed, 299 U.S. 171, 57 S.Ct. 148, 81 L.Ed. 101; John M. Parker Co. v. Commissioner, 5 Cir., 49 F.2d 254; Southern Maryland Agricultural Fair Ass'n v. Commissioner, 40 B.T.A. 549; Yokohama Ki-Ito Kwaisha, Ltd., 5 B.T.A. 1248; see also, Chattanooga Auto. Club v. Commissioner, (Warren Auto. Club v. Commissioner), 6 Cir., 182 F.2d 551 (by implication); Smyth v. California State Auto. Ass'n, 9 Cir., 175 F.2d 752 (by implication); Automobile Club of St. Paul v. Commissioner, 12 T.C. 1152 (by implication).
8
53 Stat. 467, 26 U.S.C. § 3791(b), 26 U.S.C.A. § 3791(b).
9
H.R.Rep. No. 704, 73d Cong., 2d Sess. 38; S.Rep. No. 558, 73d Cong., 2d Sess. 48.
10
Treas.Reg. 86, Art. 101—1 (1934); Treas.Reg. 94, Art. 101 1 (1936); Treas.Reg. 103, § 19.101—1 (1939).
11
20 T.C. at page 1041.
12
G.C.M. 23688, 1943 Cum.Bull. 283.
13
See, e.g., Chattanooga Auto. Club v. Commissioner, (Warren Auto. Club v. Commissioner), 6 Cir., 182 F.2d 551; Keystone Auto. Club v. Commissioner, 3 Cir., 181 F.2d 402; Smyth v. California State Auto. Ass'n, 9 Cir., 175 F.2d 752; Automobile Club of St. Paul v. Commissioner, 12 T.C. 1152.
14
Section 275(a) provides as follows:
'Except as provided in section 276—
'(a) General rule. The amount of income taxes imposed by this chapter shall be assessed within three years after the return was filed, and no proceeding in court without assessment for the collection of such taxes shall be begun after the expiration of such period.' 53 Stat. 86, 26 U.S.C. § 275(a), 26 U.S.C.A. § 275(a).
Section 276(b) provides as follows:
'(b) Waiver. Where before the expiration of the time prescribed in section 275 for the assessment of the tax, both the Commissioner and the taxpayer have consented in writing to its assessment after such time, the tax may be assessed at any time prior to the expiration of the period agreed upon. The period so agreed upon may be extended by subsequent agreements in writing made before the expiration of the period previously agreed upon.' 53 Stat. 87, 26 U.S.C. § 276(b), 26 U.S.C.A. § 276(b).
15
The 1943 tax return was due on March 15, 1944. The 1944 tax return was due on March 15, 1945.
16
To the extent that the decision in Balkan Nat. Ins. Co. v. Commissioner, 2 Cir., 101 F.2d 75, is to the contrary, it is disapproved.
17
53 Stat. 28, as amended, 58 Stat. 36, 26 U.S.C. § 54(f), 26 U.S.C.A. § 54(f).
18
H.R.Rep. No. 871, 7Th Cong., 1st Sess. 24—25; S.Rep. No. 627, 78th Cong., 1st Sess. 21.
19
53 Stat. 24, 26 U.S.C. § 41, 26 U.S.C.A. § 41.
20
Beacon Publishing Co. v. Commissioner, 10 Cir., 218 F.2d 697, and Schuessler v. Commissioner, 5 Cir., 230 F.2d 722, are distinguishable on their facts. In Beacon, performance of the subscription, in most instances, was, in part, necessarily deferred until the publication dates after the tax year. In Schuessler, performance of the service agreement required the taxpayer to furnish services at specified times in years subsequent to the tax year. In this case, substantially all services are performed only upon a member's demand and the taxpayer's performance was not related to fixed dates after the tax year. We express no opinion upon the correctness of the decisions in Beacon or Schussler.
1
53 Stat. 86, 26 U.S.C. § 275(a), 26 U.S.C.A. § 275(a).
2
58 Stat. 36, 26 U.S.C. § 54(f), 26 U.S.C.A. § 54(f).
3
53 Stat. 87, 26 U.S.C. § 276(a), 26 U.S.C.A. § 276(a).
4
53 Stat. 24, 26 U.S.C. § 41, 26 U.S.C.A. § 41.
5
53 Stat. 24, 26 U.S.C.A. § 42, 26 U.S.C.A. § 42.
6
Regulations 111, §§ 29.22(a)—17(2)(a) (bond premiums), 29.42—4 (long-term contracts). See also I.T. 3369, 1940—1 Cum.Bull. 46 (prepaid subscriptions to periodicals); I.T. 2080, III—2 Cum.Bull. 48 (1924) (advance receipts from sales of tickets for tourist cruises.
| 1112
|
353 U.S. 151
77 S.Ct. 763
1 L.Ed.2d 726
ALLEGHANY CORPORATION et al., Appellants,v.BRESWICK & CO., et al., as Common Stockholders of Alleghany Corporation, etc. BAKER, WEEKS & CO. et al., Appellants, v. BRESWICK & CO. et al. INTERSTATE COMMERCE COMMISSION, Appellant, v. BRESWICK & CO. et al.
Nos. 36, 82, 114.
Argued Jan. 23 and 24, 1957.
Decided April 22, 1957.
Rehearing Denied June 3, 1957.
See 353 U.S. 989, 77 S.Ct. 1278.
Mr. Whitney North Seymour, New York City, for appellant Alleghany corp'n.
Mr. Robert W. Ginnane, Washington, D.C., for the appellant Interstate Commerce Commission.
Mr. Harold H. Levin, New York City, for the appellants Joseph S. Gruss, et al.
Mr. Alexander Kahan, for the appellant Adelaide Neuwirth.
Mr. George Brussel, Jr., New York City, for appellees Breswick & Co. and Myron Neisloss.
Mr. Randolph Phillips, appellee, pro se.
Mr. Justice FRANKFURTER delivered the opinion of the Court.
1
These are direct appeals under 28 U.S.C. § 1253, 28 U.S.C.A. § 1253, from a final judgment of a three-judge District Court for the Southern District of New York setting aside orders of the Interstate Commerce Commission and restraining appellant Alleghany Corporation from issuing a new class of preferred stock that had been approved by the Commission. The case raises numerous questions regarding the jurisdiction and powers of the Commission, especially under § 5 of the Interstate Commerce Act, 49 U.S.C.A. § 5, for the understanding of which a rather detailed statement of the facts is necessary.
2
Section 5(2)(a), in its pertinent portions, provides: 'It shall be lawful with the approval and authorization of the Commission * * * (i) * * * for a person which is not a carrier to acquire control of two or more carriers through ownership of their stock or otherwise; or for a person which is not a carrier and which has control of one or more carriers to acquire control of another carrier through ownership of its stock or otherwise * * *.' 54 Stat. 899, 905. 49 U.S.C. § 5(2)(a), 49 U.S.C.A. § 5(2)(a).1
3
Appellant Alleghany Corporation is a Maryland corporation whose charter provides for extensive powers of investment under no express limitation. After the passage of the Investment Company Act of 1940, 54 Stat. 789, 15 U.S.C. § 80a—1 et seq., 15 U.S.C.A. § 80a—1 et seq., Alleghany registered as an investment company with the Securities and Exchange Commission. In 1944, in connection with an application by the Chesapeake & Ohio Railroad for approval by the Interstate Commerce Commission of acquisition of the property of the Norfolk Terminal & Transportation Company, Alleghany, alleging that it controlled the Chesapeake & Ohio, filed a supplementary application with the Commission joining the Chesapeake & Ohio's application and seeking approval of its own acquisition of control of the Terminal Company through the action of the Chesapeake & Ohio. In 1945, the Commission approved 'acquisition of control' of the Terminal Company by the Chesapeake & Ohio and Alleghany as a transaction within § 5(2) and further found that Alleghany 'shall be considered as a carrier subject to the (reporting and securities) provisions of section 20(1) to (10) and section 20a(2) to (11) of the act (49 U.S.C.A. §§ 20(1—10), 20a(2—11)).' 261 I.C.C. 239, 262.
4
Shortly thereafter, under the provisions of § 3(c)(9) of the Investment Company Act,2 the Securities and Exchange Commission held that Alleghany was no longer an investment company within the meaning of the Investment Company Act. 20 S.E.C. 731.
5
In March, April, and May 1954, several petitions and complaints were filed with the Interstate Commerce Commission by the New York Central Railroad, a stockholder, a protective committee, and bondholder creditors of the Central, assering violations of the law in Alleghany's purchases of New York Central stock. In view of statements by Alleghany and Chesapeake & Ohio officials that Alleghany had disposed of its holdings of Chesapeake stock, that Commission, in June, ordered Alleghany to show cause why the 1945 order providing that Alleghany should be 'considered as a carrier' should not be set aside. Allegheny replied that it would accept an order terminating its control of the Chesapeake & Ohio but requested delay until it could file a new application which, it alleged, would require the Commission's approval and continuance of its status as a noncarrier to be 'considered as a carrier' under the Interstate Commerce Act.
6
The present proceedings were commenced by the filing of such an application by Alleghany and Central—after the ousting of the old Central management in May in a proxy fight. The contents of the application were described fully in the Report of Division 4 of the Commission:
7
'The Cleveland, Cincinnati, Chicago and St. Louis Railway Company (the Big Four), the Louisville & Jeffersonville Bridge and Railroad Company (the Bridge Company or the Jeffersonville), The New York Central Railroad Company, and the Alleghany Corporation * * * on September 20, 1954, jointly applied under section 5(2) of the Interstate Commerce Act * * * for approval and authorization of (1)(a) merger of the properties and franchises of the Jeffersonville into the Big Four for ownership management, and operation; and (b) modification of the lease of January 2, 1930, under which Central, as lessee, operates the property of Big Four, lessor, to give effect to the acquisition of additional property pursuant to the proposed merger of Jeffersonville into Big Four; (2) acquisition by Central and Alleghany, by virtue of their control of Big Four, of control of the properties of Jeffersonville; and (3) continuation of Alleghany's status as a carrier subject to the provisions of section 20(1) to (10), inclusive, and 20a(2) to (11), inclusive, of the act, as provided by section 5(3) thereof.' 290 I.C.C. 725—726.
8
The Big Four already owned all the capital stock of the Jeffersonville. The Big Four itself had ceased to be an operating carrier in 1930; since then the New York Central has operated it as lessee. In addition, the New York Central owns 98.98% of the common, and 86.45% of the preferred, stock of the Big Four.
9
On March 2, 1955, Division 4 of the Commission approved and authorized the merger of the Jeffersonville into the Big Four; approved continued control of the properties and franchises of the Jeffersonville by the Central and Alleghany; modified the lease between the Big Four and the Central; continued Alleghany as a non-carrier to be 'considered as a carrier' subject to the reporting and securities provisions of the Act; and terminated the effective portions of the 1945 order in the Chesapeake & Ohio proceeding. 290 I.C.C. 725.
10
On reconsideration, the whole Commission on May 24, 1955, affirmed the conclusions of Division 4. It held that Alleghany had acquired control over Central; that at the time the present application was filed, Alleghany was in fact 'a person not a carrier which controlled an established system'; that the acquisition of control over the Central was not within § 5(2)'s requirement of Commission approval; that the rearrangement by Central of its ownership or control of its subsidiaries was within § 5(2)'s requirement of approval by the Commission and that Alleghany as the controlling party was a necessary party; and that the terms and conditions of the transactions were fair and reasonable. Rejecting the suggestion of the Securities and Exchange Commission, which had intervened, the whole Commission also held that it had no discretion to yield jurisdiction over Alleghany to the former agency.3 295 I.C.C. 11.
11
Subsequent to their application with respect to the Jeffersonville, Alleghany and Central, on December 17, 1954, filed an application under § 5(2) to 'acquire control' of the Boston & Albany Railroad Company, the Pittsfield and North Adams Railroad Corporation, and the Ware River Railroad Company through purchase by Central of their capital stock. The Central owned a little more than 16% of the Pittsfield's capital stock and none of the capital stock of the other two railroads. It operated the properties of the Boston & Albany, the Pittsfield, and the Ware River under leases due to expire in 1999, 1975, and 2873 respectively. On March 22, 1955, less than three weeks after it had approved the application in the Jeffersonville proceeding, Division 4 of the Commission approved the acquisition of such control by Alleghany and Central. (Opinion not reported.)
12
A third application filed by Alleghany, on February 18, 1955, sought permission from the Commission to issue a new 6% convertible preferred stock pursuant to a charter amendment, approved by all classes of Alleghany's stockholders, that permitted consummation of Alleghany's proposed plan of allowing its outstanding cumulative 5 1/2% preferred stock to be exchanged for the new stock. On May 26, 1955, two days after the whole Commission affirmed Division 4's orders in the Jeffersonville proceeding, Division 4 approved the new stock issue (conditioning its approval on modification of one term), and on June 22, the full Commission denied reconsideration.
13
An action was then brought before a three-judge District Court by minority common stockholders of Alleghany to require the Commission to set aside its order granting Alleghany the status of a non-carrier to be 'considered as a carrier' and its subsequent order approving the new class of preferred stock and to restrain Alleghany from issuing the new preferred stock. The three- judge District Court, convened under the Urgent Deficiencies Act, 28 U.S.C. §§ 1336, 1337, 2321 2325, 28 U.S.C.A. §§ 1336, 1337, 2321—2325, granted first a preliminary injunction, Breswick & Co. v. United States, D.C., 134 F.Supp. 132 (Circuit Judge Hincks, dissenting), and then a permanent injunction setting aside the Commission's order designating Alleghany as a 'carrier' and also its order approving Alleghany's new class of preferred stock, restraining its issue. D.C., 138 F.Supp. 123.4
14
Alleghany moved for a new trial based on the 'acquisition of control' involved in the Boston & Albany proceeding. The District Court held that the Commission's order in that proceeding gave no validity of the orders in the Jeffersonville proceeding because of the Commission's failure to provide specifically in its Boston & Albany order that Alleghany should be 'considered as a carrier.' 138 F.Supp. 138. On appeal here from the final judgment below, we noted probable jurisdiction. 351 U.S. 903, 76 S.Ct. 694, 100 L.Ed. 1440; I.C.C. v. Breswick & Co., 352 U.S. 816, 77 S.Ct. 39, 1 L.Ed.2d 43.
15
Alleghany urges initially that the Commission's orders dealing with its status under the Interstate Commerce Act and dealing with its new preferred stock were not reviewable at the suit of appellees, that appellees had no standing. We find that appellees do have standing to challenge these orders. This is not a case where 'the order under attack does not deal with the interests of investors,' or where the 'injury feared is the indirect harm which may result to every stockholder from harm to the corporation.' Pittsburgh & W. Va. R. Co. v. United States, 281 U.S. 479, 487, 50 S.Ct. 378, 381, 74 L.Ed. 980. The appellees are common stockholders of Alleghany. The new preferred stock issue approved by the Commission is convertible, and under relevant notions of standing, the threatened 'dilution' of the equity of the common stockholders provided sufficient financial interest to give them standing. See American Power & Light Co. v. S.E.C., 325 U.S. 385, 388—389, 65 S.Ct. 1254, 1255—1256, 89 L.Ed. 1683.
16
Having acquired standing to institute proceedings in the District Court by virtue of the threatened financial injury, appellees could also attack the order of the Commission conferring on Alleghany the status of a person not a carrier but to be 'considered as a carrier.' The status order was a source of the threatened financial injury. If the Commission acted out of bounds in decreeing its status order, it had no power to approve the new preferred stock issue and the plaintiffs would be entitled to relief.5
17
This brings us to the substantive issues in the litigation. In the main, these involve the jurisdiction of the Commission under §§ 5(2) and 5(3) of the Act, defining its powers.6 The validity of the status order under § 5(3) turns on compliance with the statutory requirement of § 5(2) of the Commission approval 'for a person which is not a carrier and which has control of one or more carriers to acquire control of another carrier through ownership of its stock or otherwise * * *.' Appellants Alleghany and the Commission contend that the Jeffersonville and the Boston & Albany transactions both support the Commission's assertion of jurisdiction. The District Court disagreed with respect to the former and, as we have seen, 353 U.S. 159, 77 S.Ct. 768, supra, found it unnecessary to pass on the latter.
18
Whether the Jeffersonville transaction met the statutory requirement of § 5(2) raises three questions. (1) Was Commission approval of Alleghany's acquisition of control over Central required? (2) Did Alleghany in fact control Central? (3) Did the Jeffersonville transaction involved an acquisition of control by Alleghany over the properties of the Jeffersonville?
19
The District Court held that whatever control Alleghany had over Central did not fit within the statutory requirement of 'a person which is not a carrier and which has control of one or more carriers' because the Commission had not given the approval necessary for acquisition of control of Central and its subsidiaries, 'two or more carriers.'
20
The Commission and Alleghany contend that Commission approval of the acquisition of a single, integrated system is not necessary. We need not decide this question, however, and intimate no opinion on it, for even if such approval in necessary, the statutory requirement of 'a person which is not a carrier and which has control of one or more carriers' refers to 'control' and not to 'approved control.' There seems to be no reason to read in the word 'approved.' Such a holding would mean that the failure of a company engaging in a transaction requiring Commission approval to apply for that approval would deprive the Commission of jurisdiction. Remedies against a violator are provided by § 5(7), (8), and (9) of the Act. To punish a violator by depriving the Commission of jurisdiction over it would be indeed quixotic. As the Commission points out, the problem would appear clearer were Alleghany contesting, rather than acquiescing in, its jurisdiction.
21
Control in fact then is sufficient to satisfy the requirement of § 5(2). Division 4 of the Commission reported the following:
22
'The capital stock of Central is widely held by the public, but control of its functions reposes in Alleghany and its officers as a result of a proxy contest preceding a stockholders' meeting of May 26, 1954, at which the nominees choosen by Alleghany were elected as Central's board of directors. Alleghany has an undivided half interest in 600,000 shares of Central stock with voting rights to the 600,000 shares under jointventure agreements, and in addition, owns 15,500 shares. The voting rights of Alleghany represent almost 10 percent of the total shares of Central stock outstanding. The chairman of the board of directors of Alleghany, who holds the same position with Central, beneficially owns 100,200 shares of the latter's stock. The president of Alleghany is a director of Central, and beneficially owns 300,100 shares of the latter's stock. A vice president of Alleghany holds a similar position with Central.' 290 I.C.C.A., at 727.
23
Division 4 recognized that 'the present control of the Central system has passed to Alleghany by regular corporate procedures * * *.' Id., at 741.
24
The full Commission reached this conclusion:
25
'The contention that Alleghany does not control the individual directors on Central's board ignores the realities of the situation. Alleghany and its allied interests have succeeded in electing sufficient members of the board to permit them to organize and elect their own officers. Clearly the tenure in office of such directors who permitted this action depends upon their conformance to the views of the stockholders who elected them. In our opinion the power thus reposing in Alleghany constitutes control of Central.' 295 I.C.C. 11, 16.
26
The District Court, however, held that 'if the Commission's opinions contain a conclusion that Alleghany is in control of New York Central, those opinions lack sufficient findings to support that conclusion.' 134 F.Supp at page 147. It noted that the order of Division 4 'discloses the fact that Alleghany's beneficial holdings of the Central stock are less than the combined individual holdings of Kirby, Young, Richardson and the Murchison group,' and concluded that 'the findings do no more than say that Alleghany, with someone else, controls New York Central. They do not even say whether the someone else, alone, has control.' Ibid.
27
We think that the District Court took too restricted a view of what constitutes 'control.' In 1939, in Rochester Telephone Corp. v. United States, 307 U.S. 125, 145—146, 59 S.Ct. 754, 767, 83 L.Ed. 1147, arising under the Federal Communications Act, 48 Stat. 1064, 1065, 47 U.S.C. § 152(b), 47 U.S.C.A. § 152(b), this Court rejected artificial tests for 'control', and left its determination in a particular case as a practican concept to the agency charged with enforcement.7 This was the broad scope designed for 'control' as employed by Congress in the Transportation Act of 1940, 54 Stat. 899—900, 49 U.S.C. § 1(3)(b), 49 U.S.C.A. § 1(3)(b).8 See United States v. Marshall Transport Co., 322 U.S. 31, 38, 64 S.Ct. 899, 903, 88 L.Ed. 1110.
28
That Act also added § 1(3)(b) to the Interstate Commerce Act, providing:
29
'For the purposes of (section) 5 * * * of this Act, where reference is made to control (in referring to a relationship between any person or persons and another person or persons), such reference shall be construed to include actual as well as legal control, whether maintained or exercised through or by reason of the method of or circumstances surrounding organization or operation, through or by common directors, officers, or stockholders, a voting trust or trusts, a holding or investment company or companies, or through or by any other direct or indirect means; and to include the power to exercise control.' 54 Stat. 899—900, 49 U.S.C. § 1(3)(b), 49 U.S.C.A. § 1(3)(b).
Section 1(3)(a) provides:
30
'The term 'person' as used in this part includes an individual, firm, copartnership, corporation, company, association, or joint-stock association; and includes a trustee, receiver, assignee, or personal representative thereof.' 54 Stat. 899, 49 U.S.C. § 1(3)(a), 49 U.S.C.A. § 1(3)(a).
31
The Commission's findings, setting forth the events surrounding the proxy fight for control of Central, the common directors in both, the stockholdings of Alleghany's officers and stockholders in Central, and the sworn statement of Central in the Central-Alleghany application that Central is controlled by Alleghany amply support its conclusion that 'control' of Central was in Alleghany. See footnote 7, supra.
32
The question remains whether the second portion of the statutory requirement of Commission approval 'for a person which is not a carrier and which has control of one or more carriers to acquire control of another carrier through ownership of its stock or otherwise * * *.' Has been met. What constitutes an acquisition of control? The District Court gave this restricted interpretation:
33
'A merger of carriers may involve an acquisition of control by a noncarrier, where, through the merger, the non-carrier acquires control (direct or indirect) of a carrier or carrier property which the non-carrier had previously not controlled; United States v. Marshall Transport Co., 322 U.S. 31, 64 S.Ct. 899, 88 L.Ed. 1110. But where, as in the instant case, the non-carrier (Alleghany) is (according to our assumption, arguendo) already in indirect control of a carrier (Bridge Company), and the merger still leaves the non-carrier in indirect control of such property, no acquisition by the non-carrier results from the merger * * *.' 138 F.Supp. at pages 127—128.9
34
We think that this is too narrow a reading of the statute. Not labels but the nature of the changed relation is crucial in determining whether a rearrangement within a railroad system constitutes an 'acquisition of control' under § 5(2).
35
The Court has already considered twice what constitutes an 'acquisition of control' under the Interstate Commerce Act. In New York Central Securities Corp. v. United States, 287 U.S. 12, 53 S.Ct. 45, 46, 77 L.Ed. 138, the Court interpreted § 5(2) as it read in the Transportation Act of 1920, 41 S.Ct. 456, 481:
36
"Whenever the commission is of opinion * * * that the acquisition, to the extent indicated by the commission, by one of such carriers of the control of any other such carrier or carriers either under a lease or by the purchase of stock or in any other manner not involving the consolidation of such carriers into a single system for ownership and operation, will be in the public interest, the commission shall have authority by order to approve and authorize such acquisition, under such rules and regulations and for such consideration and on such terms and conditions as shall be found by the commission to be just and reasonable in the premises."
37
In that case the order of the Commission permitting the New York Central Railroad to acquire control, by lease, of the railroad systems of the Big Four and the Michigan Central Railroad Companies, was under review. Minority stockholders contended, inter alia, that the Commission could not authorize "acquisition of control" by lease since the Central had already acquired control of both railroads by stock ownership. The Court held that the 'disjunctive phrasing of the statute 'either under a lease or by the purchase of stock' must be read in the light of its obvious purpose and cannot be taken to mean that one method must be exclusive of the other.' 287 U.S., at page 23, 53 S.Ct. at page 47. Nowhere did it intimate that the lease was not an "acquisition of control," even though the Central already had stock ownership control of both railroads. In fact, the refusal to set aside the Commission's order necessarily involved approval of the Commission's finding of an 'acquisition of control,' and the Court further stated:
38
'The public interest is served by economy and efficiency in operation. If the expected advantages are inadequately secured by stock ownership and would be better secured by lease, the statute affords no basis of the contention that the latter may not be authorized although the former exists. The fact that one precedes the other cannot be regarded as determinative if the desired coordination is not otherwise obtainable.' Ibid.
39
The Transportation Acts of 1933, 48 Stat. 211, and 1940, 54 Stat. 898, rewrote § 5 but retained the 'acquisition of control' language, except that the phrase relating to method of acquisition 'under a lease or by the purpose of stock or in any other manner not involving the consolidation of such carriers into a single system'—became, for acquisitions by both carriers and non-carriers, an all-inclusive phrase in the 1940 Act—'through ownership of their stock of otherwise.' These changes do not lessen the authority of the New York Central Securities case in the scope to be given to an "acquisition of control'.' In United States v. Marshall Transport Co., 322 U.S. 31, 64 S.Ct. 899, the Court interpreted § 5, as amended by the 1940 Act, 54 Stat. 899, 905, 49 U.S.C. § 5, 49 U.S.C.A. § 5. The Court held that the non-carrier parent (Union) of a carrier (Refiners) that proposed to purchase the property and franchises of another carrier (Marshall) 'acquired control' of the property and franchises of the vendor and was therefore subject to the Commission's jurisdiction. The substantive issues in that case were of course different from those of the present case, since there had been no prior relation between the non-carrier parent and the vendor-carrier. In reaching its decision, however, the Court was explicit regarding the purpose of § 5:
40
'It is not doubted that if Union, having control of Refiners, sought to acquire stock control of Marshall, Union would be required by § 5(2)(b) to apply for the Commission's authority to do so. But it is said that having control of Refiners, Union may, by procuring Refiners' compliance with the purchase provisions of the statute alone, extend its control indefinitely to other carriers merely by directing the purchase of their property and business by Refiners, without subjecting itself to the jurisdiction of the Commission as provided in § 5(3), so long as Union does not act directly as the purchaser of the property or of a controlling stock interest in such other carriers.
41
'We think that neither the language nor the legislative history of the statute admits of so narrow a construction. Section 5(4) makes it unlawful, without the approval of the Commission as provided by § 5(2)(a), for a person which is not a carrier and which has control of one or more carriers to acquire control of another carrier through ownership of its stock or otherwise. Not only is this language broad enough in terms to embrace the acquisition of control by a non-carrier through the purchase, by a controlled carrier, of the property and business of another carrier, but the legislative history indicates that such was its purpose.' Id., 322 U.S. at pages 36—37, 64 S.Ct. at page 902. See also id., 322 U.S. at pages 37—40, 64 S.Ct. at pages 902—903.
42
In other words, a non-carrier may not gain 'control' over carriers free of Commission regulation merely by operating through subsidiaries.
43
The crux of each inquiry to determine whether there has been an 'acquisition of control' is the nature of the change in relations between the companies whose proposed transaction is before the Commission for approval. Does the transaction accomplish a significant increase in the power of one over the other, for example, an increased voice in management or operation, or the ability to accomplish financial transactions or operational changes with greater legal ease? This is the issue, and not the immediacy or remoteness of the parent from the proposed transaction, for, as we said in the Marshall Transport case, the parent can always, by operating through subsidiaries, make itself more remote. In deciding this type of issue, of course, the finding of the Commission that a given transaction does or does not constitute a significant increase in the power of one company over another is not to be overruled so long as 'there is warrant in the record for the judgment of the expert body * * *.' Rochester Telephone Corp. v. United States, 307 U.S. 125, 146, 59 S.Ct. 754, 764, 83 L.Ed. 1147.
44
The principal issue, therefore, in the Jeffersonville proceeding is not Alleghany's remoteness from, or closeness to, the proposed transaction but rather the nature of the proposed transaction itself. The Big Four, whose stock was largely owned by Central, owned all the stock of the Jeffersonville. (By agreement between the Big Four and the Central, this stock was held by the Central.) The proposal was to merge the Jeffersonville into the Big Four. While the immediate practical effects of the merger on the operation of the Jeffersonville might be small, even minimal, a merger is the ultimate in one company obtaining control over another. So long as the Jeffersonville existed as a separate company, there was always the possibility that the Big Four, through the Central, might sell, or be forced to divest itself of, the Jeffersonville stock, and that the control of the Jeffersonville might thus pass to another railroad. In considering this possibility, it is important to note that the Jeffersonville does not connect physically with the Big Four but connects with it only by virtue of the Big Four's trackage rights over the Baltimore & Ohio, and that the Jeffersonville, with its few miles of track, also connects with the Pennsylvania, Baltimore & Ohio, Louisville & Nashville, Illinois Central, and Chesapeake & Ohio Railroads.
45
The merger of the Jeffersonville into the Big Four virtually precludes any change in the relation of the Jeffersonville lines to the Central system. The Jeffersonville will be no more. In view of this, it cannot reasonably be said that there has been no increase in the power of the Big Four, the Central, and, through its relation with them, Alleghany over the Jeffersonville. While it is not always profitable to analogize 'fact' to 'fiction,' La Fontaine's fable of the crow, the cheese, and the fox demonstrates that there is a substantial difference between holding a piece of cheese in the beak and putting it in the stomach.
46
Denial of power to the Commission to regulate the elimination of the Jeffersonville from the national transportation scene would be a disregard of the responsibility placed on it by Congress to oversee combinations and consolidations of carriers and 'to promote safe, adequate, economical, and efficient service and foster sound economic conditions in transportation and among the several carriers * * *.' and the further requirement that 'All of the provisions of this Act shall be administered and enforced with a view to carrying out the above declaration of policy.' National Transportation Policy, 54 Stat. 899, 49 U.S.C. preceding § 1, 49 U.S.C.A., note preceding section 1. We hold that the Commission was justified in finding that the merger of the Jeffersonville into the Big Four involved an "acquisition of control" of the Jeffersonville by Central and Alleghany within the meaning of § 5(2) of the Act. Since the status order of the Commission is supportable by virtue of the Jeffersonville proceeding, we need not consider the District Court's denial of Alleghany's motion, based on the Boston & Albany proceeding, for a new trial.
47
Several other matters urged by appellees remain to be considered. Appellees contend that Alleghany did not acquire control of any carrier in the Jeffersonville proceeding since the application was made by the Big Four as lessor and the Central as lessee and that therefore the Bir Four was a statutory lessor and not a carrier within § 5. We need not discuss the distinction that appellees seek to assert between lessors and carriers, for the Jeffersonville, the railroad whose control we have held was acquired by Alleghany, was an operating carrier.
48
Appellees also urge that the Marshall Transport case, 322 U.S. 31, 64 S.Ct. 899, 88 L.Ed. 1110, requires dismissal of Alleghany's application because two stockholders, alleged to dominate Alleghany, did not join in the application and therefore in the absence of those two indispensable parties, the Commission had no jurisdiction to proceed. But in the Marshall Transport case, the Commission was refusing to approve a subsidiary's application to acquire control of the property and operating rights of another carrier unless the non-carrier parent submitted itself to the Commission's jurisdiction, and the Court upheld the Commission's power to refuse to approve the application.
49
Although the Court in that case used language of 'jurisdiction,' the problem is not strictly jurisdictional in the sense that if the Commission wrongly decides that corporation or person A does not 'control' non-carrier B (which is 'considered as a carrier') and therefore that A need not join B's application to acquire control of C, the Commission loses jurisdiction over B, the power to regulate B. The Commission's jurisdiction over a non-carrier depends on whether the activities of the non-carrier fall within § 5(2) and (3) and does not depend on the action of the parent. For example, if Alleghany were contending that it could reshuffle the whole Central system without Commission approval, alleging that the Commission had no jurisdiction over it through failure to join two stockholders controlling it in the original status order proceedings, this whole problem would appear in a clearer context. The basis of the Commission's jurisdiction in the present case is Alleghany's status as 'a person which is not a carrier and which has control of one or more carriers,' seeking permission 'to acquire control of another carrier through ownership of its stock or otherwise * * *.' The failure to join two stockholders alleged to control Alleghany does not oust the Commission of jurisdiction. Since that is so, the status order submitting Alleghany to the Commission's jurisdiction cannot be attacked on that basis.
50
Appellees further argue, and the District Court held, 134 F.Supp., at pages 147—149 and 138 F.Supp. at pages 136—137, that under §§ 5(2)(b) and 17(3), appellees were entitled to an evidentiary hearing of some sort in the merger-status order proceeding (as distinguished from the subsequent preferred stock proceeding) even though the Commission had discretion to dispense with a 'public hearing.' Section 5(2)(b), in its relevant portion, provides:
51
'Whenever a transaction is proposed under subparagraph (a) * * * the Commission shall notify the Governor of each State in which any part of the properties of the carriers involved in the proposed transaction is situated, and also such carriers and the applicant or applicants * * * and shall afford reasonable opportunity for interested parties to be heard. * * * a public hearing shall be held in all cases where carriers by railroad are involved unless the Commission determines that a public hearing is not necessary in the public interest. * * *' 54 Stat. 906, as amended, 63 Stat. 485—486, 49 U.S.C. § 5(2)(b), 49 U.S.C.A. § 5(2)(b).
52
Section 17(3) provides, in part, that 'All hearings before the Commission, a division, individual Commissioner, or board shall be public upon the request of any party interested.' 54 Stat. 914, 49 U.S.C. § 17(3), 49 U.S.C.A. § 17(3).
53
We need not determine the bounds of the Commission's power to dispense with, or limit, hearings under § 5(2)(b), for appellees' claim of a right to a hearing in the merger-status order proceeding must fail for another reason—lack of the requisite interest of 'interested parties.'
54
The reference in § 5 to 'interested parties,' like the reference in § 1(20) to 'party in interest,' must be interpreted in accordance with the rules relevant to standing to become parties in proceedings under the Interstate Commerce Act. A hearing under that Act is not like a legislative hearing and 'interest' is not equivalent to 'concern.' It may not always be easy to apply in particular cases the usual formulation of the general principle governing such standing—e.g., 'the complaint must show that plaintiff has, or represents others having, a legal right or interest that will be injuriously affected by the order.' Moffat Tunnel League v. United States, 289 U.S. 113, 119, 53 S.Ct. 543, 545, 77 L.Ed. 1069. In each case, the sufficiency of the 'interest' in these situations must be determined with reference to the particular context in which the party seeks to assert its position.
55
Appellees assert three grounds of interest in the merger-status order proceeding: that they were common stockholders of Alleghany, that the assertion of jurisdiction by the Interstate Commerce Commission would deprive them of the benefits of the Investment Company Act, 54 Stat. 789, 15 U.S.C. § 80a—1 et seq., 15 U.S.C.A. § 80a—1 et seq., and that the proposed preferred stock issue was unfair.
56
The fact that appellees were common stockholders of Alleghany is insufficient 'interest.' The proceeding before the Commission was to determine whether the Jeffersonville-Big Four merger was a transaction requiring Commission approval as an acquisition of control by 'a person which is not a carrier and which has control of one or more carriers' of 'another carrier through ownership of its stock or otherwise * * *.' 54 Stat. 905, 49 U.S.C. § 5(2)(a)(i), 49 U.S.C.A. § 5(2)(a)(i). Unlike the subsequent preferred stock order whose threatened financial injury to appellees was sufficient to confer standing to bring the present proceedings, the merger agreement had no special effect on appellees or on common stockholders of Alleghany. See New York Central Securities Corp. v. United States, 287 U.S. 12, 19—20, 53 S.Ct. 45, 46, 77 L.Ed. 138. Nor did the proposed status order that Alleghany should be 'considered as a carrier' and therefore regulated by the Interstate Commerce Commission by itself pose any individualized threat to the welfare of the appellees.
57
Reliance on the alleged benefits of protection under the Investment Company Act subtly begs the question. Alleghany would be subject to regulation under the Investment Company Act only if the Interstate Commerce Commission lacked jurisdiction to regulate it under § 5 of the Interstate Commerce Act. The fact that there may be another Act that gives appellees greater protection as investors is immaterial to the appellees' right to a hearing in the merger-status order proceeding. The question here is whether the proposed transaction falls within the Interstate Commerce Commission's jurisdiction, not what the consequences will be if it does not. No special threat to appellees arises from the mere assertion of Commission jurisdiction to regulate Alleghany. When subsequent Commission action in approving the Alleghany's new preferred stock issue did present a special threat to appellees, that provided the 'interest' sufficient to attack the Commission's jurisdiction in the present proceeding. But this threat could not retroactively confer upon them the right to a hearing in the mergerstatus order proceeding, in which they had no 'interest.'
58
Appellees' claim that they were entitled to a hearing in the preferred stock proceeding is governed by § 20a(6) of the Act, which provides that 'The Commission may hold hearings, if it sees fit, to enable it to determine its decision upon the application for authority.' 41 Stat. 495, 49 U.S.C. § 20a(6), 49 U.S.C.A. § 20a(6).
59
For all these reasons, the judgment of the District Court must be reversed and the case remanded for consideration by the District Court of appellees' claim, not previously discussed, that the preferred stock issue as approved by the Commission was in violation of the Interstate Commerce Act. This disposition renders it needless to pass on appellees' motion to dismiss in No. 82.
60
Reversed and remanded.
61
Mr. Justice WHITTAKER took no part in the consideration or decision of this case.
62
Mr. Justice DOUGLAS, with whom The CHIEF JUSTICE and Mr. Justice BLACK concur, dissenting.
63
Alleghany Corporation, though not a carrier as that term is used in the Interstate Commerce Act, is subject to supervision by the Interstate Commerce Commission, 49 U.S.C. § 5(3), 49 U.S.C.A. § 5(3), and exempt from the control of the Securities and Exchange Commission under the Investment Company Act of 1940, 15 U.S.C. § 80a—3(c)(9), 15 U.S.C.A. § 80a—3(c)(9), if it has the approval of the Interstate Commerce Commission to 'acquire control of two or more carriers through ownership of their stock or otherwise.' 49 U.S.C. § 5(2) (a)(i), 49 U.S.C.A. § 5(2)(a)(i).
64
'Control' as used in § 5 is defined in § 1(3)(b):
65
'* * * to include actual as well as legal control, whether maintained or exercised through or by reason of the method of or circumstances surrounding organization or operation, through or by common directors, officers, or stockholders, a voting trust or trusts, a holding or investment company or companies, or through or by any other direct or indirect means; and to include the power to exercise control.'
66
'Control' thus means 'actual' as well as 'legal' control and includes the exercise of 'indirect' as well as 'direct' means. It seems obvious, thereofre—so obvious as to be beyond the realm of dispute or argument—that if one has 'actual' control through 'indirect' means and changes the means whereby he commands that power, he has only retained 'control,' not acquired it within the meaning of § 5(3). For one wno has 'control,' as defined, does not acquire it when he merely changes the method or means of its exercise. Yet it is clear that Alleghany did no more than that.
67
Alleghany has control of the New York Central.
68
Most of the stock of the Big Four (Cleveland, Cincinnati, Chicago & St. Louis R. Co.) is owned by Central. The lines of the Big Four are operated by Central as lessee.
69
There is a Bridge Company (the Louisville & Jeffersonville Bridge & R. Co.) whose stock, prior to the transaction about to be discussed, was owned by the Big Four and held by Central under the lease.
70
Alleghany, Central, the Big Four, and the Bridge Company applied to the Interstate Commerce Commission for permission to merge the Bridge Company into the Big Four and for Central thereafter to operate the properties of the Bridge Company under the Big Four lease. The merger was an intra-system rearrangement of properties that did not affect one whit Alleghany's 'control' in the statutory sense of the Bridge Company. Before the merger Alleghany had 'control' of the Bridge Company. It therefore did not 'acquire control' but only retained it as a result of the merger.
71
There was another transaction which Alleghany says caused it to 'acquire control' of a carrier within the meaning of § 5(3) and therefore to have a carrier status under the Interstate Commerce Act. Alleghany and Central applied to the Commission for permission to acquire the stock of Boston & Albany R. Co., Pittsfield & North Adams R. Corp., and Ware River R. Co. Central was operating the properties of those three roads under leases—two of the leases being for 99 years each and one for 999 years. The Commission approved this stock acquisition by Central.
72
There are two reasons why this transaction did not give Alleghany a carrier status. In the first place, § 5(3) gives a noncarrier the status of a carrier only 'to the extent provided by the Commission in such order.' The Commission made no such order in connection with the acquisition of the stock of the three New England carriers.
73
In the second place Alleghany, through Central, had 'actual control' of those three carriers prior to the acquisition of their stock. That 'control' was evident by the long-term leases over the properties of those carriers. Alleghany, therefore, did not 'acquire control' when Central acquired the stock of the three companies. The form of Alleghany's control changed by the stock acquisition. But the financial master of the three New England carriers was the same before Central acquired their stock, as it was afterwards. As stated by the District Court where a noncarrier is 'already in indirect control of a carrier' and the transaction relied upon 'still leaves the non-carrier in indirect control of such property, no acquisition by the non-carrier results from the merger.' 138 F.Supp. 123, 127—128.
74
The court that made that ruling had as one of its members the late Judge Frank, who had no superior when it came to an understanding of the ways of high finance and to an analysis of regulatory measures dealing with it. I see no answer to what Judge Frank and his colleagues concluded on this phase of the case.
75
That view of § 5(2) is plainly reflected in the legislative history. This control over noncarriers who acquired control of carriers was introduced in 1933. Commissioner Eastman pointed out to Congress the evil which was to be remedied—'holding companies have been bringing carriers under common control and hence combining them without any supervision or approval by the commission.'1 The Senate Report stated that the amendment gave the Commission control over holding companies that 'effect consolidations without approval of the commission.'2 To acquire control' within the meaning of § 5(2) means then to put under common control carriers that previously were separate. We would strain to find a construction which would enable holding companies to run for shelter under the Act merely because, within the system they control, there have been corporate rearrangements or readjustments that change the internal structure of the system.
76
Alleghany points with alarm to the loopholes in the law that will be created if it is held that Alleghany did not 'acquire' control in connection with the Bridge Company merger and the acquisition of the stock of the New England carriers. No loopholes will be created. Central could do neither of those two things without the approval of the Commission, since § 5(2)(a) requires Commission approval of many intra-system transactions by carriers. That is the force of the holding in New York Central Securities Corp. v. United States, 287 U.S. 12, 53 S.Ct. 45, 77 L.Ed. 138. The loophole that is created comes from granting Alleghany a carrier status. Then Alleghany escapes the far more rigorous supervision which is imposed on it by the Investment Company Act.
77
The only other means by which Alleghany could have acquired a carrier status was in connection with financial transactions long since liquidated. Alleghany had a carrier status, granted it by the Interstate Commerce Commission, when it acquired the stock of the Chesapeake & Ohio R. Co. and two other carriers. That order, issued in 1945, gave it a carrier status 'unless and until otherwise ordered' by the Commission. That order was terminated by the Commission on May 24, 1955.
78
The approval of the preferred stock issue that is involved in this litigation did not come until later, viz. June 22, 1955. At that time it seems plain that Alleghany had no carrier status and could not obtain one on the basis of the intercorporate transactions on which it relies.
79
I would affirm the judgment below.
1
Section 5(3) provides: 'Whenever a person which is not a carrier is authorized, by an order entered under paragraph (2), to acquire control of any carrier or of two of more carriers, such person thereafter shall, to the extent provided by the Commission in such order, be considered as a carrier subject to such of the following provisions as are applicable to any carrier involved in such acquisition of control: Section 20(1) to (10), inclusive of this part, sections 204(a)(1) and (2) and 220 of part II, and section 313 of part III, (which relate to reports, accounts, and so forth, of carriers), and section 20a(2) to (11), inclusive, of this part, and section 214 of part II, (which relate to issues of securities and assumptions of liability of carriers), including in each case the penalties applicable in the case of violations of such provisions. In the application of such provisions of section 20a of this part and of section 214 of part II, in the case of any such person, the Commission shall authorize the issue or assumption applied for only if it finds that such issue or assumption is consistent with the proper performance of its service to the public by each carrier which is under the control of such person, that it will not impair the ability of any such carrier to perform such service, and that it is otherwise consistent with the public interest.' 54 Stat. 907, 49 U.S.C. § 5(3), 49 U.S.C.A. § 5(3).
2
'Notwithstanding subsections (a) and (b), of this section, none of the following persons is an investment company within the meaning of this title: * * *
'Any company subject to regulation under the Interstate Commerce Act, or any company whose entire outstanding capital stock is owned or controlled by such a company: Provided, That the assets of the controlled company consist substantially of securities issued by companies which are subject to regulation under the Interstate Commerce Act.' 54 Stat. 789, 799, 15 U.S.C. § 80a—3(c) (9), 15 U.S.C.A. § 80a—3(c)(9).
3
On this appeal, the Securities and Exchange Commission, as amicus, took no position on whether the District Court 'correctly construed the relevant provisions of the Interstate Commerce Act or orders of the ICC thereunder; nor on the extent of the jurisdiction of the court below.' The views of the Securities and Exchange Commission were set forth only in relation to issues under the Investment Company Act.
4
After the preliminary injunction was granted, Alleghany moved in the District Court for suspension of the injunction pending appeal to this Court. The two judges who heard the motion divided, and the motion was therefore denied. On application to Circuit Justice Harlan, a stay was granted with respect to that portion of the new preferred stock that had been issued before the District Court's injunction was granted. Breswick & Co. v. United States, 75 S.Ct. 912. The New York Stock Exchange, however, continued to suspend trading in the new preferred stock.
5
See Rochester Telephone Corp. v. United States, 307 U.S. 125, 144, 59 S.Ct. 754, 764, 83 L.Ed. 1147, where the fact that the 'contested order determining the status of the Rochester necessarily and immediately carried direction of obedience to previously formulated mandatory orders addressed generally to all carriers * * * in conjunction with the other orders, made determination of the status of the Rochester a reviewable order of the Commission.' Whether reviewability of a status order, without more, be deemed a matter of standing to review or a matter of finality of administrative action, the basis for decision is the same: has the action of the administrative agency threatened the interests of the complant, whether corporation or, as here, stockholder otherwise qualified to sue, sufficiently to allow attack? (This does not mean of course that the same agency action that allows attack by one allows attack by the other.)
6
A brief summary of the history of § 5 is set forth in St. Joe Paper Co. v. Atlantic Coast Line R. Co., 347 U.S. 298, 315, 74 S.Ct. 574, 583, 98 L.Ed. 710 (appendix).
7
'Investing the (Federal Communications) Commission with the duty to ascertaining 'control' of one company by another (as the basis for the Commission's jurisdiction), Congress did not imply artificial tests of control. This is an issue of fact to be determined by the special circumstances of each case. So long as there is warrant in the record for the judgment of the expert body it must stand. The suggestion that the refusal to regard the New York ownership of only one third of the common stock of the Rochester as conclusive of the former's lack of control of the latter should invalidate the Commission's finding, disregards actualities in such intercorporate relations. Having found that the record permitted the Commission to draw the conclusion that it did, a court travels beyond its province to express concurrence therewith as an original question. 'The judicial function is exhausted when there is found to be a rational basis for the conclusions approved by the administrative body.' Mississippi Valley Barge Line Co. v. United States, 292 U.S. 282, 286—287, 54 S.Ct. 692, 693—694, 78 L.Ed. 1260; Swayne & Hoyt, Ltd. v. United States, 300 U.S. 297, 303, et seq., 57 S.Ct. 478, 480, 81 L.Ed. 659.' 307 U.S., at pages 145—146, 59 S.Ct. at page 764.
8
'This phrase ('control') has been used because it has recently had the benefit of interpretation by the Supreme Court in the case of Rochester Telephone Corp. v. United States, 307 U.S. 125, 59 S.Ct. 754, 83 L.Ed. 1147, decided April 17, 1939.' H.R.Rep. No. 2832, 76th Cong., 3d Sess. 63. (This was the Conference Report.)
9
The United States, which had supported the orders of the Interstate Commerce Commission in the District Court proceedings, on this appeal has taken the position that the judgment of the District Court should be affirmed because the merger of the Jeffersonville into the Big Four did not involve an "acquisition of control" over the Jeffersonville by Alleghany.
1
Hearings, House Committee on Interstate and Foreign Commerce on H.R. 9059, 72d Cong., 1st Sess., p. 250.
2
S.Rep. No. 87, 73d Cong., 1st Sess., p. 1.
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353 U.S. 230
77 S.Ct. 806
1 L.Ed.2d 792
COMMONWEALTH OF PENNSYLVANIA, City of Philadelphia, et al., appellants,v.The BOARD OF DIRECTORS OF CITY TRUSTS OF CITY OF PHILADELPHIA.
No. 769.
Decided April 29, 1957.
Rehearing Denied June 3, 1957.
See 353 U.S. 989, 77 S.Ct. 1281.
Mr.
Thomas D. McBride, Atty. Gen. of Pennsylvania, and Lois G. Forer, Deputy Atty. Gen., Philadelphia, for Commonwealth of Pennsylvania.
Messrs. Abraham L. Freedman and David Berger, Philadelphia, for City of Philadelphia and others.
Messrs. William T. Coleman, Jr., Raymond Pace Alexander, Philadelphia, and Louis Pollak, for appellants Foust and others.
Mr. Owen B. Rhoads, Philadelphia, for appellee.
PER CURIAM.
1
The motion to dismiss the appeal for want of jurisdiction is granted. 28 U.S.C. § 1257(2), 28 U.S.C.A. § 1257(2). Treating the papers whereon the appeal was taken as a petition for writ of certiorari, 28 U.S.C. § 2103, 28 U.S.C.A. § 2103, the petition is granted. 28 U.S.C. § 1257(3), 28 U.S.C.A. § 1257(3). Stephen Girard, by a will probated in 1831, left a fund in trust for the erection, maintenance, and operation of a 'college.' The will provided that the college was to admit 'as many poor white male orphans, between the ages of six and ten years, as the said income shall be adequate to maintain.' The will named as trustee the City of Philadelphia. The provisions of the will were carried out by the State and City and the college was opened in 1848. Since 1869, by virtue of an act of the Pennsylvania Legislature, the trust has been administered and the college operated by the 'Board of Directors of City Trusts of the City of Philadelphia.' Pa.Laws 1869, No. 1258, p. 1276; Purdon's Pa.Stat.Ann., 1957, Tit. 53, § 16365.
2
In February 1954, the petitioners Foust and Felder applied for admission to the college. They met all qualifications except that they were Negroes. For this reason the Board refused to admit them. They petitioned the Orphans' Court of Philadelphia County for an order directing the Board to admit them, alleging that their exclusion because of race violated the Fourteenth Amendment to the Constitution. The State of Pennsylvania and the City of Philadelphia joined in the suit also contending the Board's action violated the Fourteenth Amendment. The Orphans' Court rejected the constitutional contention and refused to order the applicant's admission. In re Girard's Estate, 4 Pa.Dist. & Co.R.2d 671 (Orph.Ct.Philadelphia). This was affirmed by the Pennsylvania Supreme Court. 386 Pa. 548, 127 A.2d 287.
3
The Board which operates Girard College is an agency of the State of Pennsylvania. Therefore, even though the Board was acting as a trustee, its refusal to admit Foust and Felder to the college because they were Negroes was discrimination by the State. Such discrimination is forbidden by the Fourteenth Amendment. Brown v. Board of Education, 347 U.S. 483, 74 S.Ct. 686, 98 L.Ed. 873. Accordingly, the judgment of the Supreme Court of Pennsylvania is reversed and the cause is remanded for further proceedings not inconsistent with this opinion.
4
Reversed and remanded with directions.
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