Court Opinion

ID: 9471453
Source: CourtListenerOpinion
Date Created: 2023-08-05 03:33:01.215585+00
Date Added: 2024-06-11T17:42:25.209644
License: Public Domain

WALD, Circuit Judge,
dissenting:
Recognizing that the panel arrives at an efficient result in approving the 10:00 a.m. delegation by two members of complete Board authority to one member for an indefinite period in anticipation of the 10:15 a.m. resignation of the only other member, I nonetheless conclude that what occurred in this case simply does not comport with what the statute says, and that the breadth of its sanctioning by the panel establishes a dangerous precedent.
There is no dispute that section 4 of the Railway Labor Act provides for the following in the first paragraph: a three-person National Mediation Board (not a single administrator); that vacancies shall not impair the powers nor affect the duties of the Board nor of the remaining members; and, immediately following the “vacancies” provision, that two members in office shall constitute a quorum for the transaction of the business of the Board. 45 U.S.C. § 154, First (1976).
So far, so good. It seems clear enough, and I believe the majority agrees, that two members must be present to transact the business of the three-person Board. Vacancies will not impair the Board’s functions so long as there are two members to transact business. The section additionally provides that in the event a member’s term runs out before a successor is qualified, he or she shall continue in office until a successor takes over. 45 U.S.C. § 154, First (1976). By this latter provision, Congress meant to ensure that the balanced structure of the Board could be maintained even if there were delays in the President’s appointment and the Senate’s approval of a new Board member.
Several paragraphs later, the section provides for the delegation by Board order of “any portion” (not the whole) of Board business to a single member “or to an em*1346ployee or employees” of the Board.1 The Board “by its order” can “amend, modify, supplement, or rescind any such assignment or reference.” All such delegation orders remain in effect until otherwise ordered by the Board. 45 U.S.C. § 154, Fourth (1976).
My colleagues read this delegation power to permit the conferring upon one member of all the Board’s authority for an indefinite period until such time as a second member shall take office. They feel that this delegation power overrides the quorum provision, which they say is confined only to Board business transacted at Board, meetings, not to Board business transacted by a member pursuant to a Board delegation.2 I, on the other hand, find the results of such an interpretation to be convoluted, potentially dangerous in terms of accountability, and contrary to the nature of the animal that Congress thought it was creating.3 Cognizant of the limbo into which Board business has been thrown—twice in its history—when a majority of its three members resigned or left office before their successors were qualified, I nevertheless believe we are standing the statutory scheme on its head by sanctioning such an open-ended delegation procedure. I believe that Congress, recognizing the recurrent nature of the problem and the inadequacy of its past efforts to deal with it, should now make specific provision for the circumstance where two out of three members resign from the Board before their successors are qualified.
These are my reasons: I will not belabor them with extensive citations because the propositions seem self-evident. When a quorum of the Board by order makes a delegation, that delegation ceases to exist when the quorum no longer exists. This is well-established in corporation law, see 2 Fletcher Cyclopedia Corporations § 421, at 2709-71 (perm. ed. 1982), and there is no indication that such a fundamental agency principle was meant to be abrogated by Congress in this statute. Section 4 itself specifically says that the Board (i.e., a quorum) at any time can amend or rescind any such assignment and can rescind any order issued by its delegate. But, in my colleagues’ view of the statute, those powers to rescind either the delegation or the delegate’s order are wiped out. For after the second member leaves office, the Board has no ability to rescind or amend the reference, no matter how the single member performs or does not perform his duties. Nor can it modify or revoke any order, no matter how unwise that order might be. There is no self-correction mechanism at all under their scheme, for no matter what the single member does, at least until a new member takes office, his delegation continues. It is an understatement to say this does not comport with any rules by which *1347corporations or agencies normally operate. Cf. Restatement (Second) of Agency §§ 120,122 (1957) (“[t]he death of the principal or loss of its capacity to act terminates the authority of the agent without notice to him”); 2 Fletcher, supra, § 504, at 514 (“[delegated authority ceases upon the resignation of the officer who delegated such authority”).
Perhaps, under the majority’s expansive reading of the delegation powers, a single member entrusted with the entire powers of the Board, including the power to delegate or amend the delegation, can amend or rescind his own delegation. While this is no help should he misbehave, it does raise an interesting question about any future delegations he might make. The delegation provision specifically allows for delegation to Board employees. Under my colleagues’ interpretation of vacancies and open-ended delegations, I see no impediment to the single member delegating all or some of the Board business to an employee, and himself retiring, leaving a headless ship altogether. I do not suggest this is likely, but the mere possibility illustrates that Congress surely did not mean to let one member by delegation function as the Board indefinitely.
The reality is there is no Board once two members resign. There is no quorum, no power to delegate or keep a delegation in effect, amend or rescind it.4 It is inconvenient and unfortunate that this is so, and provision should be made in the statute for interim appointments or the like. But we should not attempt to convolute the statutory scheme to assure that the show goes on. By so doing, we invite potential abuses both in delayed appointments, and in unaccountable concentrations of authority in the future. More importantly, we do not follow Congress’ intent as to the process that supplicants to the Board are due.
As for any problems caused by the possible invalidity of actions taken by member Harris during the ten months that he was the sole member of the Board, I agree with the majority that we can bar attacks on such actions by applying our holding prospectively.5 See Maj.Op. at n. 32 and cases cited therein; see also Buckley v. Valeo, 424 U.S. 1, 142, 96 S.Ct. 612, 693, 46 L.Ed.2d 659 (1976) (per curiam) (“[Federal Election] Commission’s inability to exercise certain powers because of the method by which its members have been selected should not affect the validity of the Commission’s administrative actions and determinations to date”). In this case, the overriding public interest in assuring certainty of Board decisions and in protecting third parties’ reliance on them, justifies such a prospective application. The practicalities of the immediate situation thus do not preclude a hold*1348ing by this court that indefinite delegations of all the Board’s powers to a single member are not authorized by the present statute.

. In usual parlance, portion means “a: a part of a whole ... b: a limited amount or quantity.” Webster’s Third New Int’l Dictionary 1768 (1976).

. I note that only by a strained interpretation and indeed insertion of “missing” words can the majority comfortably circumscribe the authority of the Board to delegate. “Vacancies” must mean “one or two [but not three] vacancies”—although the Board as an institution exists even if it cannot act for lack of a quorum if two members resign, it ceases to exist as an institution if three members resign; if delegation is to a Board member, the vacancy clause gives effect to the delegation, while if the delegation is to an employee, it is invalid, despite the words of the delegation clause which treat Board members and employees identically. See Maj.Op., text at n. 31.

. The majority notes that the delegation provision was modelled after that used in a 1933 amendment to the Interstate Commerce Act, Act of Feb. 28, 1933, ch. 136, 47 Stat. 1368. See Maj.Op., text at nn. 23 & 24. The history of that amendment unambiguously indicates that Congress never intended, and in fact feared, removing delegated functions from Commission accountability. See 76 Cong.Rec. 4540-41 (1933) (remarks of Reps. Stafford and Rayburn) (discretion of employee delegate limited by Commission review). The purpose of the delegation provision in that amendment was merely to relieve the Commission from “passpng] personally upon a multitude of matters which are of comparatively little importance, but yet cannot be disposed of as a matter of routine.” H.R.Rep. No. 1900, 72d Cong., 2d Sess. 1 (1933); S.Rep. No. 1291, 72d Cong., 2d Sess. 1-2 (1933). Clearly, the majority’s reading of the delegation provision falls well outside this limited efficiency-minded purpose.

. David B. Lilly Co. v. United States, 571 F.2d 546, 215 Ct.Cl. 572 (1978), is the only faintly analogous precedent, and I read that case as supportive of this proposition. The plaintiff in Lilly attacked the validity of Renegotiation Board orders because they were issued after three Board members’ resignations left the Board with an insufficient number of members to constitute a quorum. The Court of Claims, in a 3 to 2 decision, held the order valid because the deliberative process was complete before the Board members resigned, and “the overall preparation of the [order] form is standard and ministerial, hence capable of delegation.” Id. 571 F.2d at 549-50. Implicit in this holding is that nonministerial decision making functions as fundamental as issuing orders are not delegable to less than a quorum of the whole Board.

. Even when a court applies a new rule of law prospectively only, it generally applies the rule to the case before it. See, e.g., Northern Pipeline Construction Co. v. Marathon Pipe Line Co., 458 U.S. 50, 102 S.Ct. 2858, 2880, 73 L.Ed.2d 598 (1982); Chevron Oil Co. v. Huson, 404 U.S. 97, 92 S.Ct. 349, 30 L.Ed.2d 296 (1971) (refusing to apply retroactively an interpretation of Outer Continental Shelf Lands Act announced and applied in Rodriguez v. Aetna Casualty & Surety Co., 395 U.S. 352, 89 S.Ct. 1835, 23 L.Ed.2d 360 (1969)); Johnson v. New Jersey, 384 U.S. 719, 86 S.Ct. 1772, 16 L.Ed.2d 882 (1966) (refusing to apply retroactively constitutional interpretations regarding confessions announced and applied in Escobedo v. Illinois, 378 U.S. 478, 84 S.Ct. 1758, 12 L.Ed.2d 977 (1964), and Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966)); but cf. Buckley v. Valeo, 424 U.S. at 142, 96 S.Ct. at 693 (validating rules promulgated by improperly constituted commission and holding that they apply to parties in suit). Thus, although I agree with the majority that my view of the merits should apply prospectively only, it would still affect the outcome in this case.