Opinion ID: 415475
Heading Depth: 2
Heading Rank: 1

Heading: The Authority of a CCO in the Case it Addresses

Text: 15 The CCOs to which Schlefer seeks access--those interpreting provisions of the 1916 Shipping Act, and the 1920 and 1936 Merchant Marine Acts--are written and received in circumstances that establish them as definitive rulings on the legal questions they decide. First, a close and complete look at hierarchical relations within the Agency reveals that the Chief Counsel has authority effectively to give the legal advice furnished in CCOs the force of internal Agency law. Second, in practice, requesting officials always follow the advice given. 16 Intra-agency memoranda from subordinate to superior on an agency ladder are likely to be more deliberative in character than documents emanating from superior to subordinate. NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 155, 95 S.Ct. 1504, 1518, 44 L.Ed.2d 29 (1975); Renegotiation Board v. Grumman Aircraft Engineering Corp., 421 U.S. 168, 184-85 & n. 22, 95 S.Ct. 1491, 1500-01 & n. 22, 44 L.Ed.2d 57 (1975); Arthur Andersen & Co. v. IRS, 679 F.2d 254, 259 (D.C.Cir.1982); Brinton v. Department of State, 636 F.2d 600, 605 (D.C.Cir.1980), cert. denied, 452 U.S. 905, 101 S.Ct. 3030, 69 L.Ed.2d 405 (1981); Taxation With Representation, supra, 646 F.2d at 679-81; Coastal States, supra, 617 F.2d at 868. The converse is equally true. We therefore turn first to the division of authority between the Chief Counsel and officials who seek advice in construing the three Acts of interest to Schlefer. Our consideration looks beneath formal lines of authority to the reality of the decisionmaking process in question. 17 Formally, decisionmaking power is delegated from the head of the Maritime Administration to subordinate officials who act as primary decisionmakers. 7 These officials are not required to solicit the Chief Counsel's views before arriving at a decision. 8 If advice is sought, it is ordinarily communicated from the Office of the Chief Counsel to the requesting official, who retains initial decisionmaking authority. 9 But the contention that the Chief Counsel is wholly without authority to make substantive decisions binding upon the agency, Brief for Appellees at 6, is superficial. Even if correct as a formal matter, the statement is subject to an overriding qualification. 18 At the time a CCO is sought, the requesting official does have decisionmaking authority. With respect to decisions that involve the interpretation of the three Acts of interest to Schlefer, however, the Chief Counsel and requesting officials ultimately occupy a superior-subordinate relationship. When an Agency official makes a decision that interprets any of these three Acts, the decision must subsequently receive legal clearance from the Chief Counsel. The Chief Counsel will not clear action that is inconsistent with a CCO issued earlier to a requesting official. 10 In the end, the Chief Counsel decides questions of statutory interpretation; Agency action that depends on statutory interpretation does not occur without Chief Counsel approval. 11 19 The contours of the Chief Counsel's authority are clearly set out in Maritime Administrative Order 22-1, (MAO 22-1), J.A. 32-40, which describes the functions and duties of the Office of the Chief Counsel. The Order explicitly refers to the three Acts Schlefer specified in his FOIA request. 12 The Chief Counsel and his or her delegates are directed to approve, to give legal clearance to, or to review as to form and legality, matters arising under those Acts. 13 Other more general sections of MAO 22-1 that make no explicit reference to the three Acts, but nevertheless might require the Chief Counsel to issue a CCO interpreting those Acts, also grant decision-making authority to the Chief Counsel. 14 The current Chief Counsel concedes that legal clearance of Agency action contrary to the advice of a CCO would be granted only if the Chief Counsel or his staff determined that the reasoning in the CCO was wrong. See J.A. 51-52. 20 Our view of the overriding importance of the Chief Counsel's clearance authority is reinforced by the three sample CCO summaries included in the record, J.A. 43-45, which the Agency accepts as typical, J.A. 29. All three appear to involve decisions for which, according to our reading of MAO 22-1, legal clearance by the Office of the Chief Counsel would be required. The first summary, J.A. 43, addresses an application for a loan under section 509, or mortgage insurance under Title XI, of the Merchant Marine Act, 1936. 15 Under MAO 22-1 sections 3.02(1) and 3.03(1), neither the loan nor the mortgage insurance could be granted without legal clearance from the Office of the Chief Counsel. 16 The second, J.A. 44, involves the disposition of capital construction funds under section 607(c) of the 1936 Merchant Marine Act, 46 U.S.C. Sec. 1177(c). 17 Agency action on such a matter would require Office of the Chief Counsel legal clearance under MAO 22-1 section 3.02(1). The third, J.A. 45, addresses a section of the 1936 Merchant Marine Act, that was repealed in 1970. But it too appears to raise a question that would require Chief Counsel legal clearance. 21 The tone of CCOs themselves reflects the authority with which they are written. The examples included in the record are peremptory legal opinions or directives from the Chief Counsel, written with a clearly implied expectation that they are to be followed. In a 1939 CCO by Chief Counsel Farbach, for example, three prior Chief Counsel pronouncements are invoked with phrases such as: On February 19, 1937, the Acting [Chief] Counsel ... held ... and On November 20, 1937, the [Chief] Counsel ruled ... J.A. 6-7 (emphasis supplied). Holdings and rulings are not indicative of deliberative or advisory statements. 22 Finally, the Chief Counsel's ultimate decisionmaking authority on matters of statutory construction is confirmed by the practices and expressions of requesting officials and Chief Counsels. Neither the current nor any prior Chief Counsel whose testimony appears in the record could point to any instance in which a requesting official declined to follow the advice contained in a CCO that construed any of the three Acts of interest to Schlefer. 18 The conduct and statements of several Chief Counsels are equally revealing. In a June 1939 typical CCO, cited in full at J.A. 5-9, Chief Counsel Farbach was asked to construe one of the Acts by an Agency official who proposed his own disposition of the question raised. The proposal did not meet with Farbach's approval. Farbach reached his own, different conclusion and directly notified the affected outsider of the decision reached in the matter. The requesting official, whose proposal had been rejected, was apparently the last to learn of the outcome of the case. More recent Chief Counsels share similar views of their role. The Chief Counsel for the period 1970-73 stated that an Agency officer receiving a CCO was expected to act consistently with the advice given. In those rare instances where an officer proposed to take an action in direct conflict with the advice given, the [Chief] Counsel's office did not grant legal clearance for that action. J.A. 75. When asked if action contrary to the advice of a CCO would receive legal clearance, the 1978-79 Chief Counsel admitted: I do not recollect a situation in which I rendered a ... [CCO] which ever went back to an official or to the Assistant Secretary in which he adopted a different reasoning or solution. J.A. 65-66. The current Chief Counsel concedes that of the approximately ten CCOs prepared during his tenure none has been disobeyed by the requesting officials. J.A. 53-54. 23 In light of this record, the Agency has failed to demonstrate that the Chief Counsel merely advises requesting officials on matters of statutory interpretation. The district court's statement that each Agency official is free to accept, reject or attempt to modify the opinion he receives, J.A. 90, measured against attentive and close review of the record, inaccurately characterizes this case. While officials outside the Office of the Chief Counsel might endeavor to have the Chief Counsel modify or reconsider a CCO, officials who simply rejected CCOs dealing with the three Acts in question here would be indulging in a futile gesture. Such gestures are never in fact made.