Evening star., 1934-05-24
CARL FORD BAN
UPHELD BY COURT
IN DEALERS SUIT
Motor Makers Fight on
N. R. A. Bars Products,
0'Donoghue Rules.
PRESIDENTS EMERGENCY
POWER BASIS OF VERDICT
Decision, Rendered in Case of
Bethesda Firm, Will
Be Appealed.

Declaring Henry Ford is "thwarting
the national recovery act and defying
the Government to enforce it against
his company" Justice Daniel w.
ODonoghue ruled in District Supreme
Court today that Federal agencies
cannot be compelled to buy Ford
products The Northwest Motor Co.,
complainant In the case, noted an
appeal.
The national recovery act is an
emergency act, granting wide, sweep
ing powers to the Executive" the
judge continued.
1T would seem unreasonable that
the President should be compelled to
contract with any company, no mat
ter how wealthy or how powerful. if
that company is thwarting the recov-
cry act and defying the Government
to enforce it. 1t is not reasonable that
the Government should be required to
deal with any company blocking this
great act Of national recovery"
Answers Company Suit.
Two suits filed by the Northwest Co.
Of Bethesda, Md, to compel the De-
partments Of Agriculture and Interior
to accept their bids on approximately
1000 Ford trucks and automobiles,
were involved in the decision.
The plaintiff contended its bid was
the lowest submitted and that it was
rejected solely because they could not
furnish certificate that the Ford
company was complying with the
Presidents code of fair competition.
The bid was rejected under author
ity of an executive order by President
Roosevelt, decreeing that no bids
should be awarded any retailer unless
he could certify that the manufacturer
OF his product was complying and
would continue to comply with the
code.
Counsel for the Bethesda company
attacked this executive order, con-
tending the President had usurped his
powers and that the order was un-
constitutional because it amounted to
legislation by the Executive. Justice
ODonoghue pointed out, however,
that both parties conceded the recov-
cry act itself was constitutional and
expressed the opinion that the execu-
tive order based on the act was rea-
sonable and valid. He pointed out
tha ra1ointiF
not entitled to submit a bid because
there was no affirmative statement
that both the local concern and the
Ford company are complying with
the code requirements.
Draws Enemy Analogy.
Justice O'Donoghue at one point
drew an analogy between the Ford
company and an alien enemy, indi-
eating his belief that the Government
could not be required to purchase
goods from an acceptable retailer who
had received them from an alien
enemy
The Government was represented by
Hammond Chaffetz, special assistant
to the Attorney General. He based his
argument on the following four points:
That this suit was in effect an ac-
ton against the United States. which
cannot be sued without its consent.
That the plaintiff has no legal right
upon which to base the action.
That the executive order is valid
That an executive officer of the
Government has sufficient discretion
to say money appropriated for recovery
purposes shall not be spent in dealing
with persons who will not cooperate
in the recovery movement.
Cites U. S. Requirements.
Chaffetz concluded with the asser-
tion that ANY person seeking to bene-
fit by trading with the Government
must assure the Government that his
product will be manufactured in full
compliance with the recovery act.
"Only under these circumstances
will the $4,000, 900, 900 appropriated for
the recovery drive be spent to their
| advantage" he said.
Attorney Joseph T. Sherier. appear
ing for the Northwest Co. pointed out
that acceptance of the Ford bid by the
Government would save the tax
payers approximately $4,000 in each
transaction"
This statement was based on the
assertion in the petition that the
bids by the Ford agency were about
$4,000 lower than those by the
Chevrolet Motor Co., the nearest
competitor. In view of todays rul-
ing, however, the bids will be awarded
the Chevrolet concern,
Past Decisions Cited.
Sherier contended that under the
law a Government official, once low
bid has been submitted and opened,
has no discretion, but must award
the contract to the low bidder. He
asserted that all of the past opinions
of the Attorney General and the
Controller of the Currency are that
it is the plain duty of a Government
official to accept the lowest respon-
sible bid
AS a result, he said, the official has
nothing to do but perform a purely
administrative duty, and a suit to
compel the exercise of such duty is
not suit against the United States.
He also asserted the President did
not, through an executive order, have
power to make the recovery act ap-
plicable to the United States. Sherier
declared Congress intended the act to
apply to industrial corporations and
not to the Federal Government.