Document: 377 U.S. 235 84 S.Ct. 1236 12 L.Ed.2d 268 MASSACHUSETTS TRUSTEES OF EASTERN GAS AND FUEL ASSOCIATES, Petitioners,v.UNITED STATES. No. 137. Argued Feb. 24, 1964. Decided May 25, J. Franklin Fort, Washington, D.C., for petitioner. Wayne G. Barnett, respondent. Mr. Justice HARLAN delivered the opinion of Court. 1 This case presents claim that Maritime Commission exceeded its statutory authority under § 5 Merchant Ship Sales Act 1946, 60 Stat. 43, as amended, 50 U.S.C.App. 1738, by 2 (1) including in contract with petitioners1 bareboat charter ships a sliding scale required payment to Government more than 50% certain excess profits and 3 (2) using threat termination character arrangement compel agreement divide calendar year 1947 into separate periods purpose computing such profits. 4 Because considerable number suits are pending lower courts which will turn on resolution these issues, because conflict among circuits first issue,2 we brought here. 375 809, 46, 11 47. For reasons follow, affirm judgment below upholding power act it did. I. The Marine Act, 1936, 49 1985, 46 U.S.C. §§ 1101—1294, provided government vessels private enterprise. Section 709(a) 2010, incorporated reference 1946 5(c), provided: 6 'Every made pursuant provisions this title shall provide whenever, at end any subsequent execution charter, cumulative net voyage (after hire reserved charterer's fair reasonable overhead expenses applicable operation chartered vessels) exceed 10 per centum annum capital necessarily employed business vessels, charterer pay over Commission, additional hire, one-half profit annum: Provided, That so accounted not be included calculation years.' 7 During World War II, operations merchant marine were disrupted fleets reduced losses requisition. Meanwhile many constructed operations. Congress means supra, sought ensure post war rehabilitation having sell or surplus war-built vessels. was instructed 'so far practicable consistent policies (to), give preference * applicants purchase' charter.3 5(b), set out standards follow chartering vessels: 8 'The vessel section fixed rate determines but, except upon affirmative vote less four members 15 sales price (computed date charter). (R)ates differ from specified subsection prevailing world market rates similar use determined Commission.' 9 As already indicated, 5(c) charters Act. Prior Commission's exercising Shipping Administration interests an interim basis; followed lines specifying 'basic hire' equaled 15% 'additional 10% annual return period Special Charter Committee considered best way implement Existing rentals believed too low higher thought necessary promote policy encouraging rather charters. A majority preferred profit-sharing firm rental, since former would permit both charterers adapt fluctuating market, without imposing greater risk loss charterers. adopted basic suggestion decided charge, addition rental price, average up $100 day, 75% next $200 90% above $300 day. standard ('SHIPSALESDEMISE 303') incorporating provisions, Eastern dated October 1, 1946. Market conditions allowed high earned eight months 1947. terminate existing charters, privileged do days' notice, but agreed if accepted Adden um providing, other things, commencing September signed Addendum able, result, offset incurred latter part against before 1. did attempt litigate rights until had completed all payments agreement. In 1955 filed personam libel recovery money paid profits-sharing 'Foreign Trade Addendum.' It asserted sets maximum well minimum sharing precluded altering 5(b). claimed further that, even existed, apparent reliance 5(b) renders nugatory. Finally, argued conflicted mandate accounting profits, abused privilege threatening agreements those refusing accept split-year arrangement. All contentions rejected owner court, Court Appeals affirming District Court, 202 F.Supp. 297; 210 822, thorough opinion, 312 F.2d 214. 13 Preliminarily observe view take find unnecessary consider Government's alternative ground affirmance: doctrine waiver precludes challenging terms once benefited cannot seek overturn regards unfavorable.4 II. 14 question is whether light 709(a), impose if, so, failure articulate particular basis action vitiates validity set. We approach problem three general interpretative guides, point favor. Some weight due interpretation agency entrusted administration statute. See, e.g., United States v. Zucca, 351 91, 96, 76 671, 100 L.Ed. 964; Kern River Co. States, 257 147, 153—154, 42 60, 66 175. successive extensions vessels,5 face sliding-scale practice, certainly controlling, particularly does appear ever advertently addressed itself invalidity scale; they do, however, strengthen some extent conclusions regarding powers. 1947, following subcommittee hearings,6 House Fisheries, H.R.Rep. 725, 80th Cong., 1st Sess. (1947), recommended extension, subsequently enacted, 61 190, 191, 'with understanding dry-cargo recapture immediately increased, thus purchase ships.' P. 2. Congressional reports prior another 81st Sess., (1949); S.Rep. 55, (1949), stated: 'It contemplat d continue sell, operate accordance procedures (according Report) change present policy.' (The Senate Report reads 'any changes now effective.') Further, congressional encourage sale ships, contained 7(a) there initial presumption intended should have establish commensurate making attractive purchase, instead shipowners. Needless say, 'interpretative aids,' neither singly nor conjunction, could lead affirmance here clear contradicted requirements However, with, lend support to, what believe most sensible framework. 16 According 1936 statute: 17 '(T)he *.' (Emphasis added.) provides: 18 makes contention language limits rate. argues 'rate' normal sense 'fixed.' short answer perfectly speak based percentage no 'fixing' contingent Certainly (subject exception relevant here) reflects intent preclude developing types patterns. nothing justify strait-jacketing, proscribing development patterns serving 19 position exclusive provision, prohibits might otherwise sustained proper exercise somewhat arguable. asserts written share import altered adoption Significance placed Congress' word 'shall,' phrase 'not than,' fixing obligation 20 when passed, situations, 707(a), 2009, competitive bidding individual cases.7 Since offered afford only assessing 'the highest monthly hire,' bidders propose arrangements. Under system, primary unreasonably favorable system. context, plausibly urged raise Indeed, argue hat time, after ex proprio vigore conferred beyond prescribed 50%. question, therefore, carried statute whole. 21 First, may noted 'shall' plainly denotes minimum; one same time On hand, linguistic necessity denote maximum; can also 25% more. While, recognizing this, mean suggest standing alone read establishing minimum, significant section's inconsistent conclusion percentages permissible. expected always absolutely precise formulations. When brings forward new enactment drafted different context response circumstances policies, likelihood imprecision increased. great breadth discretion apparently given expressed concern discourage sales, very slow fetter flexibility implement, effective way, Viewing integrated whole, refuse inhibit resort characterized arid literalism.8 22 conclude, negate authority. passing, below, reached assumed conclusion. See Dichman, Wright & Pugh, Inc., D.C.N.Y., 144 922, 926; East Harbor Trading Corp., 190 245, 249; American Mail Line, Ltd., D.C.Wash., 213 152, 163; Eastport Steamship 216 649, 653—654. But see President Lines, D.C.Cal., 224 187, 190—191. Export 290 925, 930, 153 Ct. l. 201, 208—209. 23 suffices assertion purport relied 709 alone. notes added respecting imposed clause ('Form 303'), charge 'Form 203', implementation unembellished been appeared form. 203' 303' provision hire'—the percent price—was clauses E, C(1), 12. accordingly concludes equated 709(a). Citing cases holding grounds invoked validate administrative has fact insufficient requisite procedural safeguards, see, Securities Exchange Comm'n Chenery 332 194, 196, 67 1575, 1760, 91 1995; Bell 366 393, 412—413, 81 1230, 365; Burlington Truck Inc. 371 156, 167—168, 83 239, 207, indicate aspect void. entirely source least arguable inclusion within supposition unnecessary, deal agree regard irrelevant. 24 slightest assuming apprized correct authority, party substance, distinguished wording.' 297, 305. seriously challenge determination. Although alleges hesitated increase passed agencies result contractual subcharter, assert likewise explicitly referred subcharter appearing record indicates on. 25 No doubt cast anything require hearing kind procedure (except price). authorize deviations provides, course, criteria propriety deviation. supposed 'consistent Act' (at price) rates. plain instituted seems patently determination varied attention stablishing scale. 26 factors inapposite supported principles facts considered, undertaken, responsible body. These aimed assuring determinations mind manner; mistake body clearly bearing used substance decision reached, instance (assuming mistake), extension cited advance serve. imposition authorized implicitly legal significance. 27 claims scheme accounting. provides equal division 'charter equates Commission' Without attempting impossible task reading method accounting, charter' includes profits; charges computed, entitled remaining How work easily seen hypothesize acquire 100% Instead achieving goal, compute plus (the amount 709(a)). then receive consequence retain total effect limiting arrangements effected employed; (instead prohibit completely 5(b)). 28 compelled anomalous result. synonymous highly doubtful draftsmen spell carefully relationship justice whole framework limit regardless hire. Even Eastern's acceptable, reason why reach If requires turned better say full rendering superfluous, conclude extends incremental amount. argument performs dual function; allocates distributes think o perform role; s taken charter,' impediment taking contrary strained enunciated therein. III. 29 discouragement resulting sent telegrams August informing them intention contracts, parties 14. stated able conditions. 20, terms, computed separately voyages terms; suffered post-August voyages, treated unit purposes. Addendum' invalid insofar purported two periods. create contract, accomplish improper 30 untenable. There explicit limitation computation 'at year,' indirectly restriction. could, terminated rechartered sought. notification disingenuous achieve evidenced contracts were, fact, 15. states 'treated purposes constituted accord significance simply through formalities contract. 31 Affirmed. Hereafter 'Eastern.' Compare 214, Ct.Cl. 201; 922; 152; 187. 7(b), 44, 1740. press recover running limitations voluntary Commission. defenses pleaded during hearing; reserves right remand event reversal. 191; 62 38; 63 9; 349. 1950, abolished function transferred Secretary Commerce, 64 308; 1276, 1277. Hearings Subcommittee Sales, Charters, Lay-ups, (1947). 714 2011, 1204, negotiated essential trade routes successfully developed. contains Had envisioned similarity relevance later bidding, alter setting contemplated intimate between legislative history confirms taken. disapprove safeguards undermine make profitable legislators irrelevant, undisputed issue concerns structure circumscription discretion, believes Congress, desirability individually kinds

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