Opinion ID: 240284
Heading Depth: 1
Heading Rank: 4

Heading: State Tax Escalation Cases

Text: 71 These cases raise the question of the collectibility of increases in the Texas State Production Tax as provided under automatic rate increase escalation provisions in the contracts. Thus they present, in dramatic fashion, the question so vigorously argued by all petitioners on the propriety of the regulation forbidding escalation clauses. The Court in arriving at a decision, presumably on the merits, completely bypasses this question. If, as my discussion indicates, that order may be invalid, then the Commission had no right in these cases to forbid Continental Oil Company from collecting the increase from its effective date (September 1, 1954). (I do not decide this question since I think it too important to determine until we, as a Court, reach it for deliberative joint judgment.) Moreover, the Court's opinion in emphasizing the fact that there was no proof in the record of discrimination in favor of other companies under like situations overlooks the fact that the petition for rehearing, declined by the Commission, raised those facts and that charge. When it was overruled, I am at a loss to understand how the petitioner could have made any proof. Finally, while the transmutations of the order and the change of dates from September 15 to October 1 and December 1 as set forth in the opinion is accurate, it seems to me that the whole Act imposes on the Commission the necessity of having some reasonable basis for its actions. Conceding, for the moment, that there was intended significance in what appears to me to be inadvertent scrivener errors made under circumstances of understandable and almost hysterical pressure, I would have considerable doubt that a Commission may say to one Texas producer that if the application is filed on October 1, the increase can relate to September 1, but if it is filed on October 2 or November 29, it may not. Not a single reason has yet been advanced to justify that differentiation, and it is evident from the fact that the 174 Orders finally extended filing dates to December 1, that the Commission did not articulately do this because of some administrative necessity. Finally, since the Court does reach some of the merits here, I can find in the record no basis for assuming that the sales involved in these contracts were within the jurisdiction of the Commission. Such findings and evidence is necessary. Securities Exchange Commission v. Chenery Corp., 318 U.S. 80, 63 S.Ct. 454, 87 L.Ed. 626; Stark v. Wickard, 321 U.S. 288, 64 S.Ct. 559, 88 L.Ed. 733; see also, Panhandle Eastern Pipe Line Co. v. Public Service Commission, 332 U.S. 507, 512, 68 S.Ct. 190, 92 L.Ed. 128, 135. 72 I have written at such length as my views in all cases because I think these many troublesome legal questions are begging for a Judge's answer. What the answers will be, I do not known. But the Commission by its 174 Orders and action in the individual cases has presented cases ready and ripe for adjudication. 73 We shut ourselves off from life if we think that that which has had the gas business in such turbulence has, as yet, no effect or impact. 74 I therefore respectfully dissent. Notes:  Editorial note: This opinion was prepared and filed as a separate opinion in each of the following cases: No. 15320. Magnolia Petroleum Company v. Federal Power Commission, 236 F.2d 785; No. 15321. The Ohio Oil Company v. Federal Power Commission, 236 F.2d 785; No. 15352. The Superior Oil Company v. Federal Power Commission, 236 F.2d 785; No. 15354. Wesley West v. Federal Power Commission, 236 F.2d 785; No. 15471. Gulf Oil Corporation and Gulf Refining Company v. Federal Power Commission, 236 F.2d 812; No. 15470. The Texas Company v. Federal Power Commission, 236 F.2d 813; No. 15461. Union Oil Company of California and Louisiana Land and Exploration Company v. Federal Power Commission, 236 F.2d 816; No. 15704. Humble Oil & Refining Company v. Federal Power Commission, 236 F.2d 819; No. 15627. Stanolind Oil & Gas Company v. Federal Power Commission, 236 F.2d 824; No. 15678. Continental Oil Company v. Federal Power Commission, 236 F.2d 827; No. 15799. Hunt Oil Company v. Federal Power Commission, 236 F.2d 828; No. 15928. Hunt Oil Company v. Federal Power Commission, 236 F.2d 828; No. 15832. Ralph B. Shank, Trustee for Nelson Bunker Hunt Trust Estate, v. Federal Power Commission, 236 F.2d 830; No. 15749. Roy Lee, Trustee for Hassie Hunt Trust, v. Federal Power Commission, 236 F.2d 835; No. 15706 through No. 15721 (16 cases) Continental Oil Company v. Federal Power Commission, 236 F.2d 839. 1 If our decisions and Amerada Petroleum Corporation v. Federal Power Commission, 10 Cir., 231 F.2d 461, stand, there is no review of these substantial questions in sight, for Federal Power Commission v. Union Producing Company, 97 U.S.App.D.C. 223, 230 F.2d 36; Gulf Oil Corporation v. Federal Power Commission, 97 U.S.App.D.C. 227, 230 F.2d 40, foreclose the equity injunction. During the four days' argument of these cases, I vainly sought from anyone or all of the battery of advocates for the Commission, even a hypothetical situation in which some gas producer involved in some situation could have some significant review. Apparently some slight character of review is given to the State Tax Escalation Cases (note 2, infra), but in the setting of the approach of nonreviewability in the fundamental jurisdictional situations and the complete bypassing of those problems (though present) in this one group, it indicates to me that in fact no review is really recognized even there. 2 For convenience I group and refer to the cases in these categories: I. Order No. 174 Cases: No. 15320, Magnolia Petroleum Company, 236 F.2d 785; No. 15321, The Ohio Oil Company, 236 F.2d 785; No. 15352, The Superior Oil Company, 236 F.2d 785; No. 15354, Wesley West, 236 F.2d 785; No. 15471, Gulf Oil Corporation and Gulf Refining Company, 236 F.2d 812; No. 15470, The Texas Company, 236 F.2d 813; No. 15461, Union Oil Company of California and Louisiana Land and Exploration Company, 236 F.2d 816. II. Suspension cases: No. 15704, Humble Oil & Refining Company, 236 F.2d 819; No. 15627, Stanolind Oil & Gas Company, 236 F.2d 824; No. 15678, Continental Oil Company, 236 F.2d 827; No. 15799, Hunt Oil Company, 236 F.2d 828; No. 15298, Hunt Oil Company, 236 F.2d 828; No. 15461, Union Oil Company of California, Louisiana Land and Exploration Company, 236 F.2d 816. III. Abandonment Cases; No. 15832, Shank, Trustee, 236 F.2d 830; No. 14749, Roy Lee, Trustee, 236 F.2d 835. IV. State Tax Escalation Cases: Nos. 15706 through 15721, Continental Oil Company, 236 F.2d 839 This division is for convenient, orderly presentation, but the entire opinion applies to all of the cases without regard to topical or category subdivisions. 3 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. Columbia Broadcasting System, Inc., v. United States, supra, at 316 U.S. 425, 62 S.Ct. 1204, 86 L.Ed. 1575. The regulations here prescribe rules which govern the contractual relationships between the stations and the networks.    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. Id., at 316 U.S. 417, 62 S.Ct. 1200, 86 L.Ed. 1571. Here the Commission exercised its rule-making power by adopting regulations whose operation is not made subject to future administrative determinations, save only as the Commission may be called on to decide in any given case whether a station's contract with a network is within the regulations. The regulations' applicability to all who are within their terms does not depend upon future administrative action. Instead they operate to control such action and to determine in advance the rights of others affected by it.    Id., at 316 U.S. 420, 62 S.Ct. 1202, 86 L. Ed. 1573 Federal Communications Com. v. American Broadcasting Co., 347 U.S. 284, 74 S. Ct. 593, 98 L.Ed. 699, reviewed and enjoined similar general regulations applicable to all. See also, Joint Anti-Fascist Refugee Committee v. McGrath, 341 U.S. 123, 71 S.Ct. 624, 95 L.Ed. 817. 4 Section 21(b), 15 U.S.C.A. § 717t(b): Any person who willfully and knowingly violates any rule, regulation, restriction, condition, or order made or imposed by the Commission under authority of this act, shall, in addition to any other penalties provided by law, be punished upon conviction thereof by a fine of not exceeding $500 for each and every day during which such offense occurs. [Italics mine.] 5 Mr. Justice Frankfurter's dissent in Columbia, supra, 316 U.S. 429, 433, 434, 62 S.Ct. 1206, 1208, 86 L.Ed. 1577, 1580, characterized the prior cases of reviewability, In each one the force of the law either through criminal prosecution or injunction or fine or some other judicial remedy could immediately be brought to bear to enforce the command of the administrative agency. His comment analyzing United States v. Berwind-White Coal Mining Co., 274 U.S. 564, 47 S.Ct. 727, 71 L.Ed. 1204, as well as the other cases, United States v. Baltimore & Ohio Railroad Co., 293 U.S. 454, 55 S.Ct. 268, 79 L.Ed. 587; American Telephone & Telegraph Co. v. United States, 299 U.S. 232, 57 S.Ct. 170, 81 L.Ed. 142; Interstate Commerce Commission v. Goodrich Transit Co., 224 U.S. 194, 32 S.Ct. 436, 56 L.Ed. 729; Chicago, R. I. & P. R. Co. v. United States, 284 U.S. 80, 52 S.Ct. 87, 76 L.Ed. 177; Rochester Telephone Corp. v. United States, 307 U.S. 125, 59 S. Ct. 754, 83 L.Ed. 1147, involving specific penalties for violation of regulations, is significant: Since the order of the Commission commanded carriers to take specified actions, and since the failure to comply with the order would bring immediate legal sanctions, the order was held reviewable. Id. at 316 U.S. 434-436, 62 S. Ct. 1208, 1209, 86 L.Ed. 1580, 1581 6 The key to the majority's misreading of Columbia is found, I think, in the preoccupation in the Magnolia opinion (No. 15320) with some supposed peculiar difference between a Section 402(a), Title 47 U.S.C.A. § 402, Urgent Deficiencies Act, October 22, 1913, 38 St.L. 208, 219, Chap. 32, and a Section 402(b) review which, for all practical purposes, is the same as Section 19(b) here. Significantly, Mr. Justice Frankfurter in his Columbia dissent completely ignored that point and in neither of the dissents in Frozen Food Express or Storer is it even mentioned as a valid basis for distinction. In Storer, of course, it was our precise situation — a statutory review by the Court of Appeals. In 402(a) and (b) and in 19(b), the requirement of an Order and the basis for reviewability is substantially the same. Scripps-Howard Radio, Inc., v. Federal Communication Commission, 316 U.S. 4, 15, 16, 62 S.Ct. 875, 882, 86 L.Ed. 1229, 1237, It is urged that the orders reviewable under § 402(a)    are intrinsically different from those reviewable under § 402(b). But while the two sections route appeals to different courts, the differentiation was in large measure the product of Congressional solicitude for the convenience of litigants. It had no relation to the scope of the judicial function which the courts were called upon to perform   . As the legislative history of the Act plainly shows, Congress provided the two roads to judicial review only to save a licensee the inconvenience of litigating an appeal in Washington   . See also, Philadelphia Co. v. S. E. C., 82 U.S.App.D.C. 335, 164 F. 2d 889, at page 897, certiorari denied 333 U.S. 828, 68 S.Ct. 452, 92 L.Ed. 1113, subsequent proceedings 84 U.S. App.D.C. 73, 175 F.2d 808, reversed as moot 337 U.S. 901, 69 S.Ct. 1047, 93 L. Ed. 1715 Amshoff v. United States, 7 Cir., 228 F.2d 261, certiorari denied 351 U.S. 939, 76 S.Ct. 836, under the Hobbs Act, 5 U.S.C.A. § 1031 et seq., likewise reviewed, over the Administrator's contention that no definitive order had been entered, a general regulation which had the effect (as does much of the 174 Orders here) of repudiating an old and adopting a new administrative substantive policy. The majority's emphasis (Magnolia 15320) on the requirement for, A transcript of the record upon which the order complained of was entered and the usual situation of an order, of a definitive character dealing with the merits of a proceeding before the Commission and resulting from a hearing upon evidence and supported by findings appropriate to the case, Federal Power Commission v. Metropolitan Edison Co., 304 U.S. 375, 58 S.Ct. 963, 82 L.Ed. 1408    cannot, by a bootstrap-lifting process, defeat reviewability. The absence of a hearing, the receipt of evidence, the making of findings which is the very basis of much of the attack cannot thus be turned into a deficiency making it unreviewable, National Coal Association v. Federal Power Comm., 89 U.S.App.D.C. 135, 191 F.2d 462, 466; Saxton Coal Mining Co. v. National Bituminous Coal Comm., 68 App.D.C. 245, 96 F.2d 517; American Sumatra Tobacco Corp. v. S. E. C., 68 App.D.C. 77, 93 F. 2d 236; Philadelphia Co. v. S. E. C., supra; see also, Columbia Oil & Gasoline Corp. v. S. E. C., 3 Cir., 134 F.2d 265, 267. And, of course, where validity of regulation presents question of law on the face of the orders or regulations a record of evidence is not needed, see discussion of cases under II, Suspension Cases, infra. 7 § 154.91 `Independent producer' as that term is used in these Rules means any person as defined in the Natural Gas Act who is engaged in the production or gathering of natural gas and who transports natural gas in interstate commerce or sells natural gas in interstate commerce for resale, but who is not primarily engaged in the operation of an interstate pipeline. [Italics mine] 8 Original Order 174 in the prefatory portions stated: The decision of the United States Supreme Court on June 7, 1954, in Phillips Petroleum Co. v. [State of] Wisconsin, (347 U.S. 672, 74 S.Ct. 794, 98 L.Ed. 1035) holds that persons engaged in the production and gather of natural gas but which also transport natural gas in interstate commerce or make sales in interstate commerce for resale are `natural gas companies' subject to all the requirements of the Natural Gas Act.    In the Commission's brief in No. 15471, Gulf Oil Corporation, pages 1 to 3:    These orders [174] stem directly from the decision of the Supreme Court in Phillips Petroleum Co. v. [State of] Wisconsin    in which that court held that the Commission has jurisdiction over independent producers which engage `in the sale in interstate commerce of natural gas for resale, and that such a company' is a `natural gas company within the meaning of that term as defined in the Natural Gas Act' (347 U.S. at page 677, 74 S.Ct. at page 796). By these orders the Commission    promulgated general rules and regulations to be applicable to natural-gas companies which were also independent producers subject to Commission jurisdiction under the Act.    the Supreme Court held in Phillips Petroleum Co. v. [State of] Wisconsin,    that sales in interstate commerce for resale by producers and gatherers to interstate pipeline companies do not come within the `production or gathering' exemption, but that producers and gatherers making such sales also are `natural-gas companies' under the Act, and the Commission has the authority to regulate such sales. The Commission's brief in Magnolia No. 15320, page 4:    the Supreme Court on June 7, 1954, held that the Commission had jurisdiction over sales of natural gas in interstate commerce for resale, including such sales in the area of production and gathering  . This extreme view of the Phillips decision was successfully pressed by the the Commission in Federal Power Comm. v. J. M. Huber, D.C.D.N.J., 133 F.Supp. 479 (now on appeal Third Circuit). 9 In the Phillips case, 347 U.S. at page 678, 74 S.Ct. at page 797, 98 L.Ed. at pages 1045-1046, the court reaffirms the previous cases on Section 1(b): In Federal Power Commission v. Panhandle Eastern Pipeline Co., 337 U.S. 498, 505, 69 S.Ct. 1251, 1256, 93 L.Ed. 1499, we observed that the `natural and clear meaning' of the phrase `production or gathering of natural gas' is that it encompasses `the producing properties and gathering facilities of a natural-gas company.' Similarly, in Colorado Interstate Gas Co. v. Federal Power Comm., 324 U.S. 581, 598, 65 S.Ct. 829, 837, 89 L.Ed. 1206 we stated that `(t)ransportation and sale do not include production or gathering', and indicated that the `production or gathering' exemption applies to the physical activities, facilities, and properties used in the production and gathering of natural gas. Id., 324 U.S. at pages 602-603, 65 S.Ct. at page 839. See also, Federal Power Comm. v. Hope Natural Gas Co., 320 U.S. 591, 612-615, 64 S.Ct. 281, 292-294, 88 L.Ed. 333 [350-352]; Peoples Natural Gas Co. v. Federal Power Comm., 75 U.S.App.D.C. 235, 127 F.2d 153; cf. United States v. Public Utilities Comm., 345 U.S. 295, 307-311, 73 S.Ct. 706, 713-716, 97 L.Ed. 1020.    10 Order 174 A, Section 154.92, (a) Every independent producer who, on or since June 7, 1954, has engaged in the interstate    sale of natural gas subject to the jurisdiction of the Commission shall on or before October 1, 1954, [subsequently changed to December 1, 1954] file with the Commission rate schedules, as defined in Section 154.93 hereof, setting forth the terms and conditions of service and all rates and charges for such    sale effective on June 7, 1954.    (b) Every independent producer who, subsequent to the effective date of these rules, proposes to initiate an interstate    sale   to an existing or new customer shall file with the Commission not less than 30 days nor more than 60 days    a rate schedule   . 11 Section 4(c) of the Act: Under such rules and regulations as the Commission may prescribe, every natural-gas company shall file with the Commission, within such time    and in such form as the Commission may designate, and shall keep open in convenient form and place for public inspection, schedules showing all rates and charges for any transportation or sale subject to the jurisdiction of the Commission   . [Italics mine.] Whatever may be the juridical metaphysics, e. g., Douglas v. County of Pike, 101 U.S. 677, 25 L.Ed. 968; Norton v. Shelby County, 118 U.S. 425, 6 S.Ct. 1121, 30 L.Ed. 178, of what the 1954 Phillips decision did to a 1938 Act, it is plain that the Commission never claimed that it had the right to or was regulating these independent producers, Columbian Fuel Corporation, 2 FPC 200; Fin-Ker Oil and Gas Production Co., 6 FPC 92; Chicago Corporation, 6 FPC 98; Phillips Petroleum Co., 10 FPC 246, and to suggest now that on the birth of Phillips, the general regulations covering interstate transmission pipeline companies applied automatically to these individual producers lacks genuine substance. 12 It should be borne in mind that questions of this type stated in emphatic terms are not to be taken as a conclusion that such Governmental supervision is wrong or invalid, or that the regulation is. We are here concerned only with an analysis of the Court's theme that Order 174 has no effect upon, does not require action by, these petitioning gas producers 13 Section 154.94 (Order 174 A): The operation of any provision of the rate schedule providing for future or periodic changes in the rate, charge, classification, or service after June 7, 1954, or the effective date of any rate schedule for initial service after June 7, 1954, shall constitute a change in rate schedule. Substantially the same provision is contained in Section 154.94(c) of Order 174 B except that this Section has been made even more specifically applicable to price changes provided for in an initial rate schedule. In addition, Order 174 B, Section 157.25, condemns, in advance, escalator clauses in producer contracts submitted in support of applications for Certificates which would, of course, affect interstate transmission pipeline companies, since long-term contracts for their essential gas reserves which have heretofore contained escalation clauses (see note 14 infra) could no longer contain them. This is thus a radical departure on a wide front from former substantive policies. 14 Reference hereto the Suspension Cases, and particularly Stanolind (No. 15627) and Continental Oil Co. (No. 15678), involving as they do gas from the Woodlawn Field, Texas, removes this from the dreaded vacuum. The Federal Power Commission in the Mississippi River Fuel Corporation case (Docket G-1281, et al.) in 1952 stated: The most important matter presented for consideration in the instant Mississippi certificate proceedings concerns the adequacy of the gas supply showing made by Mississippi in support of its proposed system expansion. The importance of an adequate gas supply showing has been stressed by the Commission in certificate proceedings, since every certificate of public convenience and necessity under the Natural Gas Act must be based upon appropriate findings, among others, that the applicant for such certificate is `able and willing properly to do the acts and to perform the service proposed.' `An adequate gas supply', as the Commission stated in its Opinion No. 230 and Order of June 24, 1952, In the Matter of Northern Natural Gas Company, Docket No. G-1618   , `is the bedrock upon which such findings must be grounded.' `A gas supply can be considered adequate,' as the Commission further stated in the Northern case, supra, `only if the volume available is sufficient to meet the demand requirements for the service proposed, if such volume is assured over a sufficient period of years to justify the expenditures required for the construction of the proposed pipe-line project, and if that assurance of a continuing supply of natural gas meets the requirements of public convenience and necessity Generally, a supply of natural gas should be assured for a period approximating fifteen to twenty years, dependent upon the particular facts involved, if the pipeline project is to be economically sound and in the public interest and if the natural-gas company is to be in position to meet its obligations to investors and provide dependable service to consumers.' The Commission then recited that they had previously found Mississippi's supplies inadequate but allowed additional time to correct it. Acquisition of additional reserves is approved:    At the 1952 hearings Mississippi showed that it had entered into additional gas purchase contracts, covering the purchase of gas in the    Woodlawn gas fields in Texas   . These contracts are for primary terms of 20 years and provide prices ranging between 10.88¢ and 12.46¢ per Mcf    at the beginning of their terms, and thereafter higher prices are specified.    Another Suspension Case, Union Oil (No. 15461), involves suspension of escalated rates under a long-term contract with Transcontinental Pipe Line Company resulting from a renegotiation of the contract long prior to June 7, 1954, made primarily to meet the objections of the Federal Power Commission in Dockets No. G-2367 and G-4185 (see opinions No. 279 and 280, December 1954, March 1955, respectively) to sufficiency of gas reserves. After restudy of the gas supply reserves showed them to be 16.6 to 17.9 years, Transcontinental's application for certificate to build and finance facilities costing approximately $40,000,000.00 to compete for the rich New York market area was approved. 15 It is doubtful that Government (Administrators) should ever be permitted, in insulating their actions from judicial review, to assert that the citizen must run the bold course of defiance as a means of testing legality. Most rules of conduct having the force of law are not self-executing but require judicial or administrative action to impose their sanctions with respect to particular individuals. Unlike an administrative order or a court judgment adjudicating the rights of individuals, which is binding only on the parties to the particular proceeding, a valid exercise of the rule-making power is addressed to and sets a standard of conduct for all to whom its terms apply. It operates as such in advance of the imposition of sanctions upon any particular individual. It is common experience that men conform their conduct to regulations by governmental authority so as to avoid the unpleasant legal consequences which failure to conform entails.    Columbia Broadcasting System, supra, 316 U.S. at page 418, 62 S.Ct. at page 1201, 86 L. Ed. at page 1571 16 This is what the producers sought to do in the Abandonment Cases (Lee, Trustee 15749; Shank, Trustee 15832), but which, for nearly two years, the Commission has thus far prohibited 17 Section 4(e), Whenever any such new schedule is filed the Commission shall have authority    to enter upon a hearing concerning the lawfulness of such rate,    pending such hearing    may suspend the operation of    such rate   . At any hearing involving a rate or charge sought to be increased, the burden of proof to show that the increased rate or charge is just and reasonable shall be upon the natural-gas company,   . 18 United States v. Bethlehem Steel Corp., 315 U.S. 289, 298, 62 S.Ct. 581, 586, 86 L.Ed. 855, 862: The Master and the courts below, however, treated these clauses as non-severable; to do otherwise would call for departure from accepted principles of the law of contract. Whether a number of promises constitute one contract or more than one is to be determined by inquiring `whether the parties assented to all of the promises as a single whole, so that there would have been no bargain whatever, if any promise or set of promises were struck out.' Williston on Contracts, Rev.Ed., § 863, and cases there cited. 19 The powers of the Commission are defined by §§ 4(e) and 5(a). The basic power of the Commission is that given it by § 5(a) to set aside and modify any rate or contract   . It is simply the power to review rates and contracts made in the first instance by natural gas companies and, if they are determined to be unlawful, to remedy them. Section 5 (a) would of its own force apply to all the rates of a natural gas company, whether long-established or newly changed, but in the latter case the power is further implemented by § 4(e). All that § 4(e) does, however, is to add to this basic power, in the case of a newly changed rate or contract    the further powers (1) to preserve the status quo    by suspending its operation    and (2) thereafter to make its order retroactive, by means of the refund procedure   . United Gas Pipeline Co. v. Mobile Gas Corp., supra [350 U.S. 332, 76 S.Ct. 379]. [Italics by the Court.] 20 The Commission's letter report May 4, 1956, to Senator Gore revealed 191 cases involving annual increases (not including state tax increases) of $18,737,482.00 in which escalation rate increases have been suspended and hearing or decision is pending. Presumably, at least 5/12ths (5 months maximum suspension period) of this is an irretrievable loss to producers even though the Commission ultimately approves the increased rate. Apparently only 39 cases have been disposed of involving $3,218,297.00 annual increases, and the Examiner's reports and Commission decisions thereon submitted as typical examples of the Administrative problems indicate the complex matters which an applicant must face and perhaps shoulder in showing the proposed increase to be just and reasonable, e. g., is a fair price to be determined by the going price in the field? By invested capital, and if so, upon what basis, per well, or field, or unit? By a desired rate of return and if so, what percentage and upon what base? 21 Section 157.23(a): Every independent producer of natural gas who, on or since June 7, 1954, has engaged in the interstate    sale of natural gas subject to the jurisdiction of the Commission    shall    file with the Commission an application   . (b) No independent producer of natural gas shall,    engage in any new service with respect to the    interstate    sale of such natural gas for resale in interstate commerce    without approval of the Commission, evidenced by a certificate of public convenience and necessity    The contents of the applications are carefully prescribed concerning exhibits, technical data required, etc 22 Order No. 174 A provided: Section 157.28 No independent producer as defined in Section 154.91 of these rules shall abandon any sale, transportation or service, subject to the jurisdiction of the Commission, being rendered on or since June 7, 1954, without the express permission and approval of the Commission first had and obtained   . In Order No. 174 B this was changed by substituting the words of Section 7 (b) of the Act and adding the proviso:  Provided, however, That nothing herein shall be construed as interfering or as intended to interfere with or to prevent compliance by a natural-gas company with valid conservation orders of a State agency relating to the production or gathering of natural gas. The Abandonment Cases before us and other administrative action taken indicates that in the administrative application by the Commission there is no difference between 174 B and 174 A for sales are considered service rendered by    such facilities and abandonment of a sales contract by an Independent Producer is forbidden: see J. M. Huber Corp. and Northern Natural Gas Co. v. J. M. Huber Corp., Dockets No. G-4326 and G-4957, Federal Power Commission v. J. M. Huber Corp., D.C. N.J., 133 F.Supp. 479; J. M. Huber Corp. v. Federal Power Commission, 3 Cir., 236 F.2d 550; Skelly Oil Co. and Lone Star Gas Co. v. Skelly Oil Co., Dockets No. G-5380 and G-5260; Argo Oil Corp., et al., Dockets No. G-6810, G-6811, G-2591 and G-2950. 23 The command to apply for a certificate is found in Section 7(c). Its opening sentence restricts it to the completion of proposed facilities: No natural-gas company or person which will be a natural-gas company upon completion of any proposed construction or extension shall engage in the transportation or sale of natural gas   . (Italics mine.) This was the amendment of February 7, 1942, Public Law No. 444, 77th Congress, Chapter 49, Second Session [H.R. 5249], 56 Stat. 83. In its original form the Act required a certificate only when a company was entering a market in which natural gas is already being served by another natural-gas company    As investors and promoters were unwilling to risk the building of a line unless the statutory condition were met, it resulted in invariable hearings to prove the negative. The amendment was sought by the Commission to require certificates in the case of all construction, see hearings on H.R. 5249, 77th Congress, page 15 et seq. 24 Section 7(b), No natural-gas company shall abandon all or any portion of its facilities subject to the jurisdiction of the Commission, or any service rendered by means of such facilities   . [Italics mine.] 25 The Act originated in H.R. 5423, 74th Congress, as amendments to the Public Utility Act of 1935, 15 U.S.C.A. § 79 et seq., with a facilities provision identical with Section 7(b) (see hearings H.R. 5423, 74th Congress, 1st Session, pages 32, 44, § 305(b)); the next bill, H.R. 11662, 74th Congress, 2nd Session, contained no prohibition on abandonment and representatives of the State Commissioners proposed an amendment that, No gas company    shall discontinue service   , but this was rejected and language of present § 7(b) was used. In the 75th Congress, 1st Session, on H.R. 4008, efforts by the New York Public Service Commission to obtain an amendment, No natural gas company shall abandon service to any of its customers    failed, and H.R. 6586, 75th Congress, 1st Session, which became the Act, contained the language now found in § 7(b). The Committee report, No. 709, 75th Congress, 1st Session, stated, Subsection (b) requires approval of the Commission by any natural gas company desirous of abandoning any or all of its facilities subject to the jurisdiction of the Commission   . 26 By letter, June 17, 1955, from Chairman Kuykendall, Federal Power Commission, to Chairman of the Senate Committee on Interstate and Foreign Commerce, amendment of Section 7(b) was proposed to make clear    that the Commission is authorized to pass upon the proposed abandonment of any sales in interstate commerce for resale by independent producers. See hearings, 84th Congress, 1st Session, on S. 712 et al., pages 1234, 1235. No such bill was passed. Apparently the Commission has sought from Congress legislation designed to impose a general service obligation, see hearings, 80th Congress, H.R. 4051, pages 99, 100, 428-430, 461-462, and has sought to amend Section 7(b), see Annual Reports 1951 at page 145; 1952 page 152; 1953 page 155; 1954 page 170 27 The Commission's Order forbidding the transfer of leases was reversed: The Commission seeks to distinguish between the activities of production and gathering, such as drilling, spacing wells, or collecting gas, and the facilities, such as reserves and gas leases, used therefor and argues that only the former were excluded from the coverage of the Act.    In Colorado Interstate Gas Co. v. Federal Power Commission, 324 U.S. 581, 603, 65 S.Ct. 829, 839, 89 L.Ed. 1206, we said that this phrase comprehended the producing properties and gathering facilities of a natural-gas company. We now adhere to this natural and clear meaning of the words and their obvious expression of congressional intent. Of course leases are an essential part of production.    The Federal Power Commission leans heavily upon § 7 (b)   . The argument here is that since natural gas is the `lifeblood' of a pipe-line system, a company by disposing of its gas reserves, unhampered by Commission control, may render itself unable to continue service; consequently abandonment of facilities and service without the consent of the Commission will result. The argument begs the question. The section, like those above, covers only `facilities subject to the jurisdiction of the Commission.' Federal Power Commission v. Panhandle Eastern Pipe Line Co., supra, at 337 U.S. 504-509, 69 S.Ct. 1256, 93 L.Ed. 1504-1507. And see Colorado Interstate Gas Co. v. Federal Power Commission, supra, Interstate Natural Gas Co. v. Federal Power Commission, 331 U.S. 682, 67 S.Ct. 1482, 91 L.Ed. 1742; Federal Power Commission v. Hope Natural Gas Co., 320 U.S. 591, 64 S.Ct. 281, 88 L.Ed. 333, approved expressly in the Phillips decision 28 Federal Power Commission v. Hope Natural Gas Co., supra; State Corporation Commission of Kansas v. Federal Power Commission, 8 Cir., 215 F.2d 176; Hope Natural Gas Co. v. Federal Power Commission, 4 Cir., 134 F.2d 287, 310, The Natural Gas Act shows clearly that it was the intention of Congress to give the Commission    regulatory power as to future rates; but there is no indication of any intention to clothe it with judicial or quasi-judicial powers with respect to past charges or practices, such as was vested in the Interstate Commerce Commission   . As the Commission itself says, it was not given authority to fix rates for the past or to award reparations on account of past rates. 29 To the familiar lament from the Commission, the Court stated at 201 F.2d 572: We are not impressed with the argument that we are without jurisdiction in the premises   . The commission argues that the order which we are asked to review is not a definitive or final order   ; but our power to review is not limited to final orders.    The order which we are asked to review is therefore sufficiently distinct from the general subject of the litigation and sufficiently final and definitive to justify us in exercising the power of review vested in us by the statute. 30 The same objection was made: Reviewability is thus not strictly limited to final orders.    And, reviewability extends to an order issued by the Commission which finally determines the legal rights of the parties with respect to matters within the scope of review. See Atlantic Seaboard Corp. v. Federal Power Commission, 4 Cir., 201 F.2d 568;   . The orders sought to be reviewed here do not deal with the merits of the proceedings before the Commission in the sense that they were entered upon evidence concerning the reasonableness of the rates. They do not purport to finally determine Phillips' wholesale rates. That matter is left to a conventional hearing in these proceedings. But the orders do purport to establish with finality the wholesale rates which Phillips was authorized to charge Michigan on June 7, 1954    the legal consequences which attach to these orders have conclusive effect upon the rights and duties of Phillips as an independent producer    and they are therefore reviewable. 227 F.2d at page 474 31 See Amarillo-Borger Express v. United States, D.C.N.D.Tex., 138 F.Supp. 411, expressly approved and followed in Long Island Railroad Co. v. United States, D.C. E.D.N.Y., 140 F.Supp. 823 (statutory three-judge courts), in which an illegal revocation of a suspension order by the Interstate Commerce Commission was enjoined. The extensive materials dealt with under the Administrative Procedure Act raises considerable doubt in my mind that the Court's action here, in rejecting the Administrative Procedure Act, is correct. Of course, reviewability depends on the statutes and not what the parties say they invoke. See footnotes 2, 3 and 4, United States v. Storer Broadcasting Co., supra 32 On the review, if granted, there would be a substantial question whether the Commission had the right to reject, as they did, one or more of these filings. Mississippi River Fuel Corp. v. Federal Power Commission, 3 Cir., 202 F.2d 899 On Petition for Rehearing 75