Legal Document

339 U.S. 667 70 Supreme Court Reporter 876 94 L.Ed. 1194 SKELLY OIL CO. et al.v.PHILLIPS PETROLEUM Number 221. Argued Dec. 9, 1949. Decided June 5, 1950. Mr. Charles L. Black, Austin, Tex., for petitioners. Harry D. Turner, Oklahoma City, Okl., respondent. [Argument of Counsel from page 668 intentionally omitted] Justice FRANKFURTER delivered the opinion Court. 1 In 1945, Michigan-Wisconsin Pipe Line Company sought Federal Power Commission a certificate public convenience and necessity, required by § 7(c) Natural Gas Act, 52 Statutes-at-Large 825, as amended, 15 United States Code KF62 717f(c), Annotated KF65 U5 construction operation pipe line to carry natural gas Texas Michigan Wisconsin. A prerequisite such is adequate reserves gas. To obtain these entered into an agreement with Phillips Petroleum on December 11, whereby latter undertook make available Hugoton Field, sprawling over Kansas, Texas, which it produced or purchased others. had contracted petitioners, Skelly Oil Company, Stanolind Magnolia purchase them in Field resale Michigan-Wisconsin. Each contract provided that 'in event shall fail secure before (October 1, 1946) necessity its line, Seller (a petitioner) have right terminate this written notice Buyer (Phillips) at any time after 1946, but issuance certificate.' The legal significance provision core litigation. 2 Commission, response application Michigan-Wisconsin, November 30, ordered 'A be hereby issued applicant (Michigan-Wisconsin), upon terms conditions order,' listing among there no transportation sale means sanctioned facilities until all necessary authorizations were obtained State Wisconsin communities proposed served, should approval Securities Exchange plan financing, file schedule reasonable rates, not used Detroit Ann Arbor except due regard rights duties Panhandle Eastern intervened established service areas, set forth supplemental order. It was also fifteen days issue order notify whether 'as herein acceptable it.' Finally, Commission's purposes computing within applications rehearing could filed, 'the date deemed opinions, referred herein, whichever may later.' 5 F.P.C. 953, 954, 956. 3 News action released actual content made 2, 1946. Petitioners severally, gave termination their contracts ground received necessity. Thereupon brought suit against petitioners District Northern Oklahoma. Alleging 'within meaning said Act contracts' been prior petitioners' attempt contracts, they invoked Declaratory Judgment declaration still effect binding parties thereto.' Motions dropped party plaintiff sustained, motions dismiss complaint want jurisdiction denied. case then went merits, decreed between 'effectively terminated each remain (sic) full force effect.' Appeals Tenth Circuit affirmed, 174 Reporter, 2nd Series 89, we here, 338 846, 88, because raises sharp form question like 'arises under Constitution, laws treaties States,' 28 1331, so enable Courts give declaratory relief Act. 48 955, now 2201, 2201. 4 '(T)he procedural only.' Aetna Life insurance company Hartford, Conn. versus Haworth, 300 227, 240, 57 461, 463, 81 617, 108 American Law Reports 1000. Congress enlarged range remedies federal courts did extend jurisdiction. When concerned are power inferior entertain litigation restricted area Constitution Acts confine them, 'jurisdiction' kinds issues entrance courts. Jurisdiction sense altered Prior court would only if asked immediately enforceable remedy money damages injunction, given requisites jurisdiction, diversity, foundation resort allowed way recognizing plaintiff's even though immediate enforcement asked. But requirements jurisdiction—the limited subject matters alone authorized adjudicate—were impliedly repealed modified. See Great Lakes Dredge & Dock Huffman, 319 293, 300, 63 1070, 1074, 87 1407; Colegrove Green, 328 549, 551 552, 66 1198, 1199, 90 1432. If specific performance bring theory asserting right. And simple reason 'arise' law governing contracts. Whatever claim able urge injected anticipation defense asserted 'Not every emerging proof basis suit.' Gully First National Bank Meridian, 299 109, 115, 96, 99, 70; compare 1257, 1331. Ever since Metcalf City Watertown, 128 586, 589, 9 173, 174, 32 543, has settled doctrine where 'upon sole determination depends some nature, must appear, outset, bill suing, character.' 'a suggestion one other will up does arising those laws.' Tennessee Union Planters' Bank, 152 454, 464, 14 654, 657, 38 511. itself present 'unaided anything alleged avoidance defenses thought defendant interpose.' Taylor Anderson, 234 74, 75—76, 34 724, 58 1218; Louisville Nashville R. Mottley, 211 149, 152, 29 42, 43, 53 126. 6 These decisions reflect current jurisdictional legislation March 3, 1875, 18 470, first entrusted lower wide cases 'arising Laws States, Treaties.' U.S.Const. Article III, 2. 'The change accordance general policy acts, manifest face, often recognized court, circuit (which became Courts) States.' supra, 462, 657. Arkansas Kansas Coal Co., 183 185, 188, 22 47, 48, 46 144, pages 112—114, 97, 98. With exceptions relevant, narrowed opportunities courts, more careful than earlier enforcing limitations. 113, 7 observant restrictions indulge formalism sterile technicality. turn vast indubitably law, vindicated State-created, merely anticipated derived law. Not unduly swell volume embarrass courts—and potential review—in local involved, either decide doubtful questions hold pending disposition sanction suits because, case, artful pleading anticipates based contravene whole trend Congress, disregard effective functioning judicial system distort purpose Developments Law—Declaratory Judgments—1941—1949, 62 Harv.L.Rev. 787, 802—803 (1949). Since matter controversy judgment * States' cannot sustained score diversity citizenship, proceedings dismissed. 8 As Magnolia, corporation, different situation presented. Delaware citizenship. qualified do business appointed agent process prevailing statute. Okla.Stat.Ann. tit. 18, 452. claimed proceeding arise consent sued. This contention rejected below, reexamine applied Under Neirbo Bethlehem Shipbuilding Corp., 308 165, 60 153, 84 167, 1437, venue properly laid Oklahoma; immaterial. Therefore, reach merits. They relate two matters: (1) clause permitting 'issuance' necessity' Commission; (2) satisfied Magnolia's despite phraseology 'certificate identic phrase equated term statute problem proper what constitutes 7(c). So viewing matter, held requirement contract, therefore terminal period timely. 10 recalled three parts: (A) stated Michigan-Wisconsin"; (B) imposed certain grant, order; (C) 'For course reasoning concluded statutory can briefly summarized. relied grammatical argument tense subsequently 'issuing necessity,' e.g., 37; conditional nature impair efficacy 7(e) 'to attach exercise granted thereunder require'; connecting order's defined securing relevant 11 We persuaded rest decision analysis led conclusion. need linger long court; weight bear. Of course, considerable administrative discretion when fairly 'issued.' Section 16 717o, provides 'Orders manner prescribe.' surely defining seeking reconsideration aggrieved person substance bosom Commission. Knowledge extent manifest. Here notice. 12 rule distinguishes 'adoption' 'issuance.'1 However, usage, having 'issued' particular fact 'adoption.' See, Louisiana 813, 897; cf. Pacific Elec. 824, 901. restriction Part Contract finds support face There nothing indicate apply entire 19 717r, allows thirty order' makes review. 323. 13 distributive scope, varying contexts examined, occasion single uniform content. Whether here fact, finding respected unless clearly erroneous. found piece paper dated day agreed executive session known. leaves untouched ought darkness pronounce question. truncated treatment underlie record. Considering dispose involve important concerning regulatory implications importance private litigants naturally enough wholly represent neither below nor benefit experience illumination agency Act,2 administration justice requires our discretionary reviewing 'require further just circumstances.' 2106; Honeyman Hanan, 14, 25, 350, 355, 476. Accordingly, think vacate remand sending back explore, through ways appropriate, bare. Kennedy Silas Mason 334 249, 68 1031, 92 1347. impact both Even language 7(c), scope independent same words, settings, mean thing. Compare Holmes Towne Eisner, 245 418, 158, 372, L.R.A.1918D, 254, his dissent Eisner Macomber, 252 189, 219, 40 197, 64 521, 1570. Parties necessarily endow statute, particularly variant meanings Standard California Johnson, 316 481, 483, 1168, 1169, 86 1611. context 717 seq., irrelevant. remanding foreclose inquiry.3 respect vacated cause remanded inconsistent opinion. Stanolind, reverse directions 17 ordered. directions; reversed directions. BLACK agrees affirm judgment. 20 DOUGLAS took part consideration case. 21 Chief VINSON, whom BURTON joins, dissenting part. N Immigration Nationality Decisions concur Court's directs dismissal Stanolind. real doubts all, interpretation body. unnecessary holds question, any, not, therefore, attach. While result one, am prepared time. 23 forced vacation Magnolia. that, petitioner, affirmed. decides erred holding adopted stating Applicant, order, *.' express intention alternative grounds. First, suggested while issuing 'adopted' Second, 30 rehearing, precludes 30. Neither grounds, my judgment, supports 24 first, argued Appeals, true rules provide text mimeographed mailed proceeding. usually follows 'adopted.' postponement far informed, postpone running 30-day who standing ask rehearing. 25 uniformly refers adoption 'issued.'1 when, 12, 1947, referring 'order necessity.' Furthermore, 26 'On Saturday, granting, conditions, covenience Company. During members came wording Fuquay, secretary exact text. directed release immediately.' 27 Following adjournment day, sent telegram proceeding, informing 'Commission today Opinion Order, Docket G.—669, certificate, Company.' On releases press announcing taken Skelly, very well granting later date—for parties. distinguished That view, indicated takes few get orders fairness parties, begin run orders, text, available, abeyance second short answer. 31 paragraph says. understand thus Computation time, indicated, relation certificate. intended whatever computation crucial (of necessity).' By inclusion dependent agency, obvious construed reference statutes practices concluded.2 see reason, proceedings. Appeals. Rule 13(b) Rules Practice Procedure provides: 'In involving Office Secretary mails delivers copies (full text) attorneys record, public, earlier. Commission.' Regulations 1.13(b). deposition light point. previous Cum.Supp. 50.75. 13(c) dates otherwise specifically orders.' 1.13(c). effectiveness §§ 717s, 717t. discuss bearing qualifying formally called 'certificate' precisely practice shed helpful light. conclusions stated: although containing act. defendants, together compels conclusion contemplation contracts.' suggests sentence focusing meaning. law:

Classification Label: 8