Document: 367 U.S. 374 81 S.Ct. 1554 6 L.Ed.2d 908 UNITED STATES, Petitioner,v.George E. SHIMER. No. 392. Argued April 27, 1961. Decided June 12, Mr. Wayne G. Barnett, Washington, D.C., for petitioner. Edward Davis, Philadelphia, Pa., submitted on brief, respondent. Justice HARLAN delivered the opinion of Court. 1 The United States brought this action in Eastern District Pennsylvania to recover from Shimer, theories subrogation and indemnity, an amount $4,000 which Veterans' Administration, as guarantor a loan made him by Excelsior Saving Fund Loan Association, had paid that institution. 2 relevant facts, stipulated parties, are these: In 1948 World War II veteran, borrowed $13,000 secured mortgage upon residential realty Shimer purchased with proceeds. At Shimer's request pursuant Title III Servicemen's Readjustment Act 1944, amended 1945,1 granted maximum guarantee loan—that is, lesser or 4/13 indebtedness outstanding at any particular time.2 Both 'Home (now 38 U.S.C.A. § 1801 et seq.). Administration certificate guaranty, specified rights parties would be governed Regulations effect date guaranty. defaulted 1948, 1949 Excelsior, mortgagee, notified his default obtained judgment foreclosing then debt excess $13,000.3 After property was sheriff's sale $250, it entire guaranty present against Shimer. 3 Court Appeals, chose rely exclusively Administration's alleged right indemnity accordingly does not press its claim here theory subrogation. Appeals held entitled recover, reaching result applying well-established principle surety law both agree recognized Congress when passed III: guarantor, could principal, obligated pay behalf. Turning state determine extent obligation court below considered under been released further liability time guarantee, after foreclosure sale. 276 F.2d 792. Under Deficiency Judgment Act4 mortgagee who purchases mortgaged execution proceedings cannot deficiency unless until obtains determination fair market value credits unsatisfied liability. When, eventuated case, fails bring proceeding purpose within six months sale, debtor permanently discharged. 4 We certiorari, 364 889, 221, 5 186, pass contentions that: (1) application is inconsistent prescribed agency charged administering Act; (2) these authorized federal enactment; (3) arises favor proper payment obligations guarantor. I. promulgated make clear they were intended create uniform system determining operation displace law. Section 36.4321, 12 Fed.Reg. 8344, subsection (a)5 implements 'pro rata' requirements 500(b) statute, Note 2, supra, establishes procedure computing can, 506 demand have applied unpaid default.6 instance agreed such $4,000. However, we informed Solicitor General allowed encouraged delay collecting all events may lead government offset taken place. potential subrogee some portion proceeds possible offset. Accordingly, waited collect This (b) 36.4321 provides 'Credits accruing * security subsequent computation (pursuant (a) supra), prior submission (guaranty) claim' shall reduction 'the payable no event exceed remaining balance indebtedness.' It point (the foreclosure) sale.' method also Regulations, indeed spelled out 36.4320, 13 7739—7741, great detail there can little doubt administrative intent should provide exclusive procedure.7 substance, section every case least realized credited. specifies way require credit more than received thereby protect itself very risk designed alleviate—the having good simply because sold inadequate price judicial Administrator 'specify advance minimum credited borrower account sold.' must reduce before has option, however, selling amount. If, specify holder (mortgagee) net *.' effect, then, scheme set up measure assurance what regards property. terms case: With $13,000, full retain worth less $9,000. If $10,000 $250 $3,000 or, matter precisely, realize $1,000 off claimed default. if regarded he (which did not) (or 'upset price') debt. less, option reconvey valuation Administration. 7 protection, while remedy same abuses directed, course, procedures do obligate purchase judicially determined value. regulatory scheme, complete detail, whole source protection interests was, extent, meant law.8 II. 8 think establishing procedures.9 regard important recall scope our review this. More half-century ago declared 'where committed head department certain duties requiring exercise discretion, thereon, whether involve questions fact, will reviewed courts exceeded authority clearly wrong.' Bates & Guild Co. v. Payne, 194 106, 108—109, 24 595, 597, 48 L.Ed. 894. admonition consistently followed whenever decision meaning reach statute involved reconciling conflicting policies, understanding force statutory policy given situation depended ordinary knowledge respecting matters subjected regulations. See, e.g., National Broadcasting States, 319 190, 63 997, 87 1344; Labor Relations Board Hearst Publications, Inc., 322 111, 64 851, 88 1170; Republic Aviation Corp. Board, 324 793, 65 982, 89 1372; Securities Exchange Comm. Chenery Corp., 332 194, 67 1575, 1760, 91 1995; Seven-Up Bottling Co., 344 344, 73 287, 97 377. 9 need only consider authorization 36.4320(a)(4) 'If upset price) would, regulations consistent much have, addition, accepted benefits local tended guarantor's loss price. Thus, specific reference Act, nothing inherently illogical about providing price' device adding that, situations where technique used Administrator, assessment mortgagee. chosen take advantage laws like Pennsylvania. choice represents reasonable accommodation policies agency's care disturb appears legislative history one sanctioned. 10 doubtless true broadly stated, enable veterans obtain loans them foreclosure, veteran veteran's indebtedness, equally adopted included provisions furthered second purposes. ample indications operate substantial equivalent down price, order induce prospective mortgagee-creditors 100% financing home.10 allowable view effective reconciliation twofold ends might accomplished partial adoption State 11 assure mortgagee-creditor able either fulla mount sell For example, knew keep property, recovering paid. faced hands $9,000 secure residual (after total $13,000). precisely assume insisted lent Presumably therefore willing accept Administrator's exchange payment. contrast, whose subject additional cost risk, neither required litigate fact it, absorb error difference between estimate Thus assessed $10,000, resulting left place unrequited loan, whereas stand loan.11 say lender prefer guaranteed applicable. Nor unreasonably sacrificed Government's relying preserve interchangeability specifying subtract protecting places own financial resources behind debtor-veteran forced reimburse considers retains 14 ends, first, making payment, and, second, unnecessary And since find antagonistic accommodation, hold valid 504 (note 9, supra). III. 15 Respondent's final contention even though nevertheless t him. argued, circumstances these, over mortgagee's rights. proceeded suit. 16 Prior amendment 1945 assumed concomitants relationship follow mere Government indemnity. Restatement Law Security, 104; Decisions Affairs, 625, Vol. 1, p. 1154. amendments explicit due thereupon 'shall subrogated guaranty.' 17 argued amendment, negative implication, overruled rejected previously independent but surely carrying implication too far. Congress, without problem discussion relieve direct amounts properly behalf Not waiver normal burdensome route recovery deprive occasions limited law, yet protected Relief convert into grant aid. But 'home loan' outright grants, rather cash (S. 1767, 78th Cong., 2d Sess.) credit, returning servicemen. 18 Moreover, recognition merely failure lender's principal incompatible background general drawn. Leslie Compton, 103 Kan. 92, 172 P. 1015, L.R.A.1918F, 706. Indeed, already ruled barred 19 reasons, constrained construction lower courts, including two below, affords See Cir., 792; McKnight 259 540; Jones, 155 F.Supp. 52; Gallardo, 154 373; Henderson, 121 343. 20 Finally, untenable respondent's argument applicable Regulation support 36.4323(e), 2123, provided: 'Any liabilities insured act constitute owing veteran.' declaratory surety's customary consent principal. 104. unaffected defenses available guarantor.12 simpson,S uretyship, 227; Stearns, Suretyship, 284. certainly indicates depart rule guaranties Administration.13 21 reversed remanded opinion. 22 so ordered. 23 remanded. BLACK DOUGLAS affirm reasons stated 58 Stat. 291, 59 626 (now) 'Sec. 500. Any person served active military naval service September 16, 1940, termination war eligible title. ten years purposes, compliance provisions, title, automatically title exceeding fifty per centum loan: Provided, That aggregate real-estate *. '(b) Loans conditions thereto, limitations issued 504: decrease increase pro rata consequently open consideration remand Purdon's Pa.Stat., Tit. §§ 2621.1—2621.11. 36.4321(a) part: 'Computation claims; accountings. Subject limitation originally guaranteed, percentage computed later decree 1816, 1817) provides: 'In notify exent 36.4320 (whose length intricacy impracticable spreading opinion) particulars generally clarified dates wording light 36.4300 Applicability. part thereto each automatic otherwise insured, publication thereof Federal Register, quaranteed legal vested thereunder impaired.' (Emphasis added.) 8342. conclusion fortified 36.4320(d) specifically excludes waives type guarantors lenders seemed fit other section. Subdivision (d) bid lawful decree, legally required. successful bidder required, govern purposes ultimate insurance. adjustment reason bid.' 212(a), 1804) 'The promulgate rules amended, necessary appropriate delegate subordinate employees issue certificates, evidence, functions hereunder.' H.R.Rep. 1418, Sess., pp. 3, 9; Hearings Subcommittee Senate Committee Finance H.R. 3749, 79th 1st 31—33 (General Omar Bradley). return became liable (i.e., see notes 6, supra) administration respondent Administrator. particularly form predecessor 2123. earlier Regulation, 12655, '(a) creditor

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