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372 U.S. 734
83 S.Ct. 1033
10 L.Ed.2d 100
Raymond DOWNUM, Petitioner,v.UNITED STATES.
No. 489.
Argued March 20, 1963.
Decided April 22, 1963.
Richard Tinsman, San Antonio, Texas, for petitioner.
William A. Geoghegan, Cincinnati, Ohio, for respondent.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
This case, involving a federal prosecution for stealing from the mail and forging and uttering checks so stolen, presents a question under the Double Jeopardy Clause of the Fifth Amendment '* * * nor shall any person be subject for the same offence to be twice put in jeopardy of life or limb * * *.' Petitioner and three others were charged in an indictment containing eight counts. The codefendants pleaded guilty, petitioner being tried alone before a jury and convicted on all but Counts 1 and 2, which did not apply to him. The claim of double jeopardy arose as follows:
2
On the morning of April 25, 1961, the case was called for trial and both sides announced ready. A jury was selected and sworn and instructed to return at 2 p.m. When it returned, the prosecution asked that the jury be discharged because its key witness on Counts 6 and 7 was not present—one Rutledge, who was the payee on the checks involved in those counts. Petitioner moved that Counts 6 and 7 be dismissed for want of prosecution and asked that the trial continue on the rest of the counts. This motion was denied and the judge discharged the jury over petitioner's objection. Two days later when the case was called again and a second jury impaneled, petitioner pleaded former jeopardy. His plea was overruled, a trial was had, and he was found guilty. The Court of Appeals affirmed, 5 Cir., 300 F.2d 137; and we granted the petition for certiorari because of the seeming conflict between this decision and Cornero v. United States, 48 F.2d 69, 74 A.L.R. 797, from the Ninth Circuit. 371 U.S. 811, 83 S.Ct. 54, 9 L.Ed.2d 54.
3
The present case was one of a dozen set for call during the previous week, and those cases involved approximately 100 witnesses. Subpoenas for all of them, including Rutledge, had been delivered to the marshal for service. The day before the case was first called, the prosecutor's assistant checked with the marshal and learned that Rutledge's wife was going to let him know where her husband was, if she could find out. No word was received from her and no follow-up was made. The prosecution allowed the jury to be selected and sworn even though one of its key witnesses was absent and had not been found.
4
From United States v. Perez, 9 Wheat. 579, 6 L.Ed. 165, decided in 1824, to Gori v. United States, 367 U.S. 364, 81 S.Ct. 1523, 6 L.Ed.2d 901, decided in 1961, it has been agreed that there are occasions when a second trial may be had although the jury impaneled for the first trial was discharged without reaching a verdict and without the defendant's consent. The classic example is a mistrial because the jury is unable to agree. United States v. Perez, supra; Logan v. United States, 144 U.S. 263, 298, 12 S.Ct. 617, 628, 36 L.Ed. 429; Dreyer v. Illinois, 187 U.S. 71, 85—86, 23 S.Ct. 28, 32—33, 47 L.Ed. 79; Keerl v. Montana, 213 U.S. 135, 29 S.Ct. 469, 53 L.Ed. 734. In Wade v. Hunter, 336 U.S. 684, 69 S.Ct. 834, 93 L.Ed. 974, the tactical problems of an army in the field were held to justify the withdrawal of a court-martial proceeding and the commencement of another one on a later day. Discovery by the judge during a trial that a member or members of the jury were biased pro or con one side has been held to warrant discharge of the jury and direction of a new trial. Wade v. Hunter, supra, 336 U.S. 689, 69 S.Ct. 837, 93 L.Ed. 974; Simmons v. United States, 142 U.S. 148, 12 S.Ct. 171, 35 L.Ed. 968; Thompson v. United States, 155 U.S. 271, 15 S.Ct. 73, 39 L.Ed. 146. At times the valued right of a defendant to have his trial completed by the particular tribunal summoned to sit in judgment on him may be subordinated to the public interest—when there is an imperious necessity to do so. Wade v. Hunter, supra, 336 U.S. 690, 69 S.Ct. 837—838, 93 L.Ed. 974. Differences have arisen as to the application ofthe principle. See Brock v. North Carolina, 344 U.S. 424, 73 S.Ct. 349, 97 L.Ed. 456; Green v. United States, 355 U.S. 184, 188, 78 S.Ct. 221, 223—224, 2 L.Ed.2d 199. Harassment of an accused by successive prosecutions or declaration of a mistrial so as to afford the prosecution a more favorable opportunity to convict are examples when jeopardy attaches. Gori v. United States, supra, 367 U.S. 369, 81 S.Ct. 1526—1527, 6 L.Ed.2d 901. But those extreme cases do not mark the limits of the guarantee. The discretion to discharge the jury before it has reached a verdict is to be exercised 'only in very extraordinary and striking circumstances,' to use the words of Mr. Justice Story in United States v. Coolidge, 25 Fed.Cas. 622, 623. For the prohibition of the Double Jeopardy Clause is 'not against being twice punished, but against being twice put in jeopardy.' United States v. Ball, 163 U.S. 662, 669, 16 S.Ct. 1192, 1194, 41 L.Ed. 300. The jury first selected to try petitioner and sworn was discharged because a prosecution witness had not been served with a summons and because no other arrangements had been made to assure his presence. That witness was essential only for two of the six counts concerning petitioner. Yet the prosecution opposed petitioner's motion to dismiss those two counts and to proceed with a trial on the other four counts—a motion the court denied. Here, as in Wade v. Hunter, supra, 336 U.S. at 691, 69 S.Ct. at 838, 93 L.Ed. 974, we refuse to say that the absence of witnesses 'can never justify discontinuance of a trial.' Each case must turn on its facts. On this record, however, we think what was said in Cornero v. United States, supra, states the governing principle. There a trial was first continued because prosecution witnesses were not present, and when they had not been found at the time the case was again called, the jury was discharged. A plea of double jeopardy was sustained when a second jury was selected, the court saying:
5
'The fact is that, when the district attorney impaneled the jury without first ascertaining whether or not his witnesses were present, he took a chance. While their absence might have justified a continuance of the case in view of the fact that they were under bond to appear at that time and place, the question presented here is entirely different from that involved in the exercise of the sound discretion of the trial court in granting a continuance in furtherance of justice. The situation presented is simply one where the district attorney entered upon the trial of the case without sufficient evidence to convict. This does not take the case out of the rule with reference to former jeopardy. There is no difference in principle between a discovery by the district attorney immediately after the jury was impaneled that his evidence was insufficient and a discovery after he had called some or all of his witnesses.' 48 F.2d at 71, 74 A.L.R. 797.
6
That view, which has some support in the authorities,1 is in our view the correct one. We resolve any doubt 'in favor of the liberty of the citizen, rather than exercise what would be an unlimited, uncertain, and arbitrary judicial discretion.'2 This means that the judgment below must be and is reversed.
7
Reversed.
8
Mr. Justice CLARK, with whom Mr. Justice HARLAN, Mr. Justice STEWART and Mr. Justice WHITE join, dissenting.
9
The Court in applying the rule of Cornero v. United States, 48 F.2d 69, 74 A.L.R. 797 (C.A.9th Cir., 1931), says that 'the valued right of a defendant to have his trial completed by the particular tribunal summoned to sit in judgment on him may be subordinated to the public interest—when there is an imperious necessity to do so.' (Emphasis supplied.) The Court of Appeals was urged to adopt the Cornero rule, but it refused. Applying that rule here, the Court orders the conviction reversed and petitioner set free.*
10
In Wade v. Hunter, 336 U.S. 684, 69 S.Ct. 834, 93 L.Ed. 974 (1949), this Court refused to follow the Cornero rule, which was characterized as holding that the absence of witnesses was not such an 'imperious' or 'urgent necessity' as to come within the recognized exception to the double jeopardy provision. Id., at 691, 69 S.Ct. at 838, 93 L.Ed. 974. The Court said:
11
'We are asked to adopt the Cornero rule under which petitioner contends the absence of witnesses can never justify discontinuance of a trial. Such a rigid formula is inconsistent with the guiding principles of the Perez decision (United States v. Perez, 9 Wheat. 579, 6 L.Ed. 165 (1824)) to which we adhere. Those principles command courts in considering whether a trial should be terminated without judgment to take 'all circumstances into account' and thereby forbid the mechanical application of an abstract formula. The value of the Perez principles thus lies in their capacity for informed application under widely different circumstances, without injury to the defendants or to the public interest.' Ibid.
12
I adhere to Wade v. Hunter, which in short holds that 'a trial can be discontinued when particular circumstances manifest a necessity for so doing, and when failure to discontinue would defeat the ends of justice.' Id., at 690, 69 S.Ct. at 838, 93 L.Ed. 974.
13
In order to apply the principles of Wade v. Hunter, it is necessary that the facts be recalled. On Wednesday or Thursday of the week preceding trial, some 12 cases, including petitioner's were set by the court for the following Monday. This was, in the words of the trial judge, 'very short notice.' Transcript of Record, p. 18. Subpoenas were issued by the District Attorney's office for approximately 100 witnesses and placed in the hands of the marshal. The petitioner's case was No. 10 on the list, and the prosecutor stated that he did not foresee that it would be reached on Tuesday, the second day of the week's hearings. The prosecutor's office was shorthanded, one of the assistants being in the military service. The prosecutor who had been assigned to petitioner's case had learned from the marshal the previous day that the wife of a Mr. Rutledge, who was the key witness in petitioner's case, would inform them of her husband's whereabouts, if she should learn of it. Since the prosecutor was trying another case on the Tuesday morning that petitioner's case was called, he was unable immediately to contact the marshal and determine whether Mr. Rutledge was present, and he announced ready for trial without ascertaining this. The jury for petitioner's case was selected and then excused until 2 p.m., and the prosecutor proceeded to complete the hearing of his other case before noon. Then, upon checking with the marshal's office during the noon recess, the prosecutor discovered that Rutledge was not present. He immediately informed the judge in his chambers, and upon the opening of the afternoon session defense counsel was advised in open court that the key witness of the Government was not available and the case would have to go over a couple of days. A defense motion to dismiss two of the six counts in the indictment—those on which Rutledge was the key witness—on the ground of lack of prosecution and proceed to trial on the remaining counts was denied by the court, and the jury was discharged—all over objections from the defense. Two days later the case was called and the petitioner interposed his plea of double jeopardy. Thereafter, a second jury was impaneled, and petitioner was tried and found guilty on all counts.
14
The first jury had never begun to act in this case. Petitioner was never formally arraigned in the presence of the first jury, nor was any evidence presented or heard for or against him at that time, nor was he required to put on any defense. In addition, the second jury having been impaneled two days later, there was no continued or prolonged anxiety, nor was the petitioner caused any additional expense or embarrassment, deprived of any right or prejudiced in any way. Neither has petitioner contended that one jury was more or less favorable than the other.
15
The conclusions of the trial court and the Court of Appeals indicate that they viewed the circumstances in which the prosecutor found himself as having resulted from excusable oversight. There is no indication that the prosecutor's explanation was a mere cover for negligent preparation or that his action was in any way deliberate. There is nothing in the record that even suggests that the circumstances were used by the prosecutor for the purpose of securing a more favorable jury or in any way to take advantage of or to harass the petitioner. Indeed, it appears to be just one of those circumstances which often creep into a prosecutor's life as a result of inadvertence when many cases must be handled during a short trial period.
16
We can of course visualize other ways of handling the situation. The judge might have held the first jury together, rather than discharging them, until Mr. Rutledge's attendance could have been obtained. But this, viewed prospectively from the moment the court acted, would have tied up 12 men on the panel for an indefinite period and disrupted the calendar for the entire week, if not longer. It is entirely understandable that the trial judge was concerned with his calendar. Moreover, even if a two-day continuance in the above manner—holding the first jury—were later held improper on appeal from the trial court's judgment, the petitioner could then be retried after suffering not only the time and expense of one full trial but also the disclosure of his defense. Nor is the claim of petitioner that the Government should have proceeded on the other counts of the indictment, which he claims did not require the testimony of Rutledge, any more tenable. This not only would have required two trials but also might raise the legal proposition that the prosecution on the remaining two counts was barred. While ordinarily the other four counts might have been sufficient to support a maximum sentence, the prosecutor might well have had good reason, in addition to the obvious preference for one rather than two trials, for wanting all counts considered in one proceeding. The indictment charged the petitioner with forging and passing government checks and conspiring with two codefendants, who pleaded guilty, to commit those acts. Rutledge was the payee of some of the checks and might well have been an important, though not the key, witness with reference to the conspiracy. In fact, the prosecutor expressed to the trial court his opinion that, under the entire indictment, he could not safely go to trial without the attendance of Rutledge. Transcript of Record, pp. 19 20.
17
As I see the problem, the issue is whether the action of the prosecutor in failing to check on the presence of his witness before allowing a jury to be sworn was of such moment that it constituted a deprival of the petitioner's rights and entitled him to a verdict of acquittal without any trial on the merits. Obviously under the facts here he suffered no such deprivation. Ever since Perez this Court has recognized that the 'ends of public justice' must be considered in determining such a question. 9 Wheat., at 580, 6 L.Ed. 165. In this light I cannot see how this Court finds that the trial judge abused his discretion in affording the Government a two-day period in which to bring forward its key witness who, to its surprise, was found to be temporarily absent. I believe that the 'ends of public justice,' to which Mr. Justice Story referred in Perez, require that the Government have a fair opportunity to present the people's case and obtain adjudication on the merits, rather than that the criminal be turned free because of the harmless oversight of the prosecutor.
1
In United States v. Watson, 28 Fed.Cas. 499, 500—501, the court ruled as follows:
'The illness of the district attorney, it not appearing by the minutes that such illness occurred after the jury was sworn, or that it was impossible for the assistant district attorney to conduct the trial, and the motion to put off the case for the term being made by such assistant, cannot be regarded as creating a manifest necessity for withdrawing a juror. So, too, as to the absence of witnesses for the prosecution, it does not appear by the minutes that such absence was first made known to the law officers of the government after the jury was sworn, or that it occurred under such circumstances as to create a plain and manifest necessity justifying the withdrawing of a juror. The mere illness of the district attorney, or the mere absence of witnesses for the prosecution, under the circumstances disclosed by the record in this case, is no ground upon which, in the exercise of a sound discretion, a court can, on the trial of an indictment, properly discharge a jury, without the consent of the defendant, after the jury has been sworn and the trial has thus commenced. To admit the propriety of the exercise of the discretion on such grounds would be to throw open the door for the indulgence of caprice and partiality by the court, to the possible and probable prejudice of the defendants. When the trial of an indictment has been commenced by the swearing of the jury, the defendant is in their charge, and is entitled to a verdict of acquittal if the case on the part of the prosecution is, for any reason, not made out against him, unless he consents to the discharging of the jury without giving a verdict, or unless there is such a legal necessity for discharging them as would, if spread on the record, enable a court of error to say that the discharge was proper.' And see United States v. Shoemaker, 27 Fed.Cas. 1067.
2
United States v. Watson, supra, note 1, 28 Fed.Cas. p. 501.
*
Both Cornero and United States v. Watson, 28 Fed.Cas. 499 (D.C.S.D.N.Y.1868), which the Court says supports Cornero, are entirely distinguishable on their facts. In Cornero the Government sought a five-day continuance because its witnesses could not be found. This was followed by a mistrial and then two years later a second trial, as contrasted with a mere two-day delay in the instant case before a second jury was impaneled and the trial begun. It could therefore be said realistically that the Government proceeded at the first trial in Cornero without its evidence and that the retrial after two years was an harassment. Moreover, subpoenas in Cornero had neither been issued nor served, while here the subpoena had been issued but, for reasons which the trial court thought justifiable, it had not been served. In Watson the Court granted an eight-day continuance after the jury was sworn, on the ground that the District Attorney was ill and government witnesses were absent. Upon resumption of the trial the prosecutor asked that the case go off for the term because of the continued illness of the District Attorney. In holding that these circumstances did not warrant the discharge of the jury the Court observed that the illness of the District Attorney did not appear to have occurred after the jury was sworn, that apparently the government officers had not first learned of the absence of witnesses after the jury had been sworn, and that it was not shown that it was impossible for the Assistant District Attorney to conduct the trial. Nor was there any indication in Watson that subpoenas had been issued.
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372 U.S. 714
83 S.Ct. 1022
10 L.Ed.2d 84
The COLORADO ANTI-DISCRIMINATION COMMISSION et al., Petitioners,v.CONTINENTAL AIR LINES, INC. Marlon D. GREEN, Petitioner, v. CONTINENTAL AIR LINES, INC.
Nos. 146 and 492.
Argued March 28, 1963.
Decided April 22, 1963.
[Syllabus intentionally omitted]
T. Raber Taylor and Floyd B. Engeman, Denver, Colo., for petitioners.
Howard H. Jewel, Asst. Atty. Gen., for State of California, as amicus curiae, by special leave of Court.
Shirley A. Siegel, New York City, for State of New York, as amicus curiae, by special leave of Court.
Patrick M. Westfeldt, Denver, Colo., for respondent.
[Amicus Curiae from pages 715-716 intentionally omitted]
Mr. Justice BLACK delivered the opinion of the Court.
1
Petitioner Marlon D. Green, a Negro, applied for a job as a pilot with respondent Continental Air Lines, Inc., an interstate air carrier. His application was submitted at Continental's headquarters in Denver, Colorado, and was later considered and rejected there. Green then made complaint to the Colorado Anti-Discrimination Commission that Continental had refused to hire him because he was a Negro. The Colorado Anti-Discrimination Act of 1957 provides that it is an unfair employment practice for an employer 'to refuse to hire, to discharge, to promote or demote, or to discriminate in matters of compensation against, any person otherwise qualified, because of race, creed, color, national origin or ancestry.'1 After investigation and efforts at conciliation, the Commission held extensive hearings and found as a fact 'that the only reason that the Complainant was not selected for the training school was because of his race.'2 The Commission ordered Continental to cease and desist from such discriminatory practices and to 'give to the Complainant the first opportunity to enroll in its training school in its next course * * *.' On review the District Court in and for the City and County of Executive Orders. The Supreme Court Denver set aside the Commission's findings and dismissed Green's complaint. It held that the Anti-Discrimination Act could not 'constitutionally be extended to cover the hiring of flight crew personnel of an interstate air carrier' because it would impose an undue burden upon commerce in violation of Art. I, § 8, cl. 3, of the United States Constitution, which gives Congress power 'To regulate Commerce * * * among the several States * * *,' and because the field of law concerning racial discrimination in the interstate operation of carriers is preempted by the Railway Labor Act,3 the Civil Aeronautics Act of 1938,4 and Federal Executive Orders. The Supreme Court of Colorado affirmed the judgment of dismissal but discussed only the question of whether the Act as applied placed an undue burden on commerce, concluding that it did. 149 Colo. 259, 368 P.2d 970 (1962). The obvious importance of even partial invalidation of a state law designed to prevent the discriminatory denial of job opportunities prompted us to grant certiorari. 371 U.S. 809, 83 S.Ct. 26, 9 L.Ed.2d 52 (1962).
2
First. Continental argues that the State Supreme Court decision rested on an independent and adequate nonfederal ground. For that argument, it relies on the trial court's statement 'that the Colorado legislature was not attempting to legislate concerning problems involving interstate commerce' and the statement of the Supreme Court of Colorado that:
3
'The only question resolved was that of jurisdiction. The trial court determined that the act was inapplicable to employees of those engaged in interstate commerce, and the judgment was based exclusively on that ground.' 149 Colo., at 265, 368 P.2d, at 973.
4
We reject this contention. The trial court itself did not rest on this ground. Instead, it clearly and unequivocally stated that the case presented a constitutional question of whether the Act could legally be applied to interstate operations. Nor did the Supreme Court of Colorado rely on this ground. It interpreted the trial court's opinion as having held that the Act was invalid insofar as it regulated interstate air carriers. The Court further stated that the question was whether the Act could be applied to interstate carriers, which it answered by concluding that under the Federal Constitution the State Legislature had no power to deal with such matters. We are satisfied that the courts below rested their judgments on their interpretation of the United States Constitution and the preemptive effect of federal statutes and Executive Orders.
5
Second. In holding that the Colorado statute imposed an undue burden on commerce, the State Supreme Court relied on the principle, first stated in Cooley v. Board of Wardens of the Port of Philadelphia, 12 How. 299, 13 L.Ed. 996, that States have no power to act in those areas of interstate commerce which by their nature require uniformity of regulation, even though Congress has not legislated on the subject.5 The State Court read two prior decisions of this Court, Hall v. DeCuir, 95 U.S. 485, 24 L.Ed. 547 (1878), and Morgan v. Virginia, 328 U.S. 373, 66 S.Ct. 1050, 90 L.Ed. 1317 (1946), as having established that the field of racial discrimination by an interstate carrier must be free from diverse state regulation and governed uniformly, if at all, by Congress. We do not believe those cases stated so encompassing a rule. The line separating the powers of a State from the exclusive power of Congress is not always distinctly marked; courts must examine closely the facts of each case to determine whether the dangers and hardships of diverse regulation justify foreclosing a State from the exercise of its traditional powers. This was emphatically pointed out in Hall v. DeCuir, supra, the very case upon which Continental chiefly relies:
6
'Judges not unfrequently differ in their reasons for a decision in which they concur. Under such circumstances it would be a useless task to undertake to fix an arbitrary rule by which the line must in all cases be located. It is far better to leave a matter of such delicacy to be settled in each case upon a view of the particular rights involved.' 95 U.S., at 488, 24 L.Ed. 547.
7
The circumstances in Hall v. DeCuir were that a Louisiana law forbidding carriers to discriminate on account of race or color had been applied so as to hold a steamboat owner liable for damages for assigning a colored passenger to one cabin rather than another. This was held to violate the Commerce Clause, but only after a careful analysis of the effects of the law on that carrier and its passengers. Among other things, the Court pointed out that if each of the 10 States bordering the Mississippi River were free to regulate the carrier and to provide for its own passengers and freight, the resulting confusion would produce great inconvenience and unnecessary hardships. The Court concluded that:
8
'Commerce cannot flourish in the midst of such embarrassments. No carrier of passengers can conduct his business with satisfaction to himself or comfort to those employing him, if on one side of a State line his passengers, both white and colored, must be permitted to occupy the same cabin, and on the other be kept separate. Uniformity in the regulations by which he is to be governed from one end to the other of his route is a necessity in his business * * *.' 95 U.S., at 489, 24 L.Ed. 547.
9
After the same kind of analysis, the Court in Morgan v. Virginia, supra, held that a Virginia law requiring segregation of motor carrier passengers, including those on interstate journeys, infringed the Commerce Clause because uniform regulation was essential. The Court emphasized the restriction on the passengers' freedom to choose accommodations and the inconvenience of constantly requiring passengers to shift seats. As in Hall v. DeCuir, the Court explicitly recognized the absence of any one, sure test for deciding these burden-on-commerce cases. It concluded, however, that the circumstances before it showed that there would be a practical interference with carrier transportation if diverse state laws were permitted to stand. The importance of a particularized inquiry into the existence of a burden on commerce is again illustrated by Bob-Lo Excursion Co. v. Michigan, 333 U.S. 28, 68 S.Ct. 358, 92 L.Ed. 455 (1948), where the Court had before it a state statute requiring common carriers to serve all people alike regardless of color. The Court upheld the law as applied to steamships transporting patrons between Michigan and Canada. Following the rule that each case must be adjudged on its particular facts, the Court concluded that neither Hall nor Morgan was 'comparable in its facts, whether in the degree of localization of the commerce involved; in the attenuating effects, if any, upon the commerce * * *; or in any actual probability of conflicting regulations by different sovereignties.' 333 U.S., at 39, 68 S.Ct. at 364.
10
We are not convinced that commerce will be unduly burdened if Continental is required by Colorado to refrain from racial discrimination in its hiring of pilots in that State. Not only is the hiring within a State of an employee, even for an interstate job, a much more localized matter than the transporting of passengers from State to State6 but more significantly the threat of diverse and conflicting regulation of hiring practices is virtually nonexistent. In Hall and in Morgan the Court assumed the validity both of state laws requiring segregation and of state laws forbidding segregation. Were there a possibility that a pilot hired in Colorado could be barred solely because of his color from serving a carrier in another State, then this case might well be controlled by our prior holdings. But under our more recent decisions7 any state or federal law requiring applicants for any job to be turned away because of their color would be invalid under the Due Process Clause of the Fifth Amendment and the Due Process and Equal Protection Clauses of the Fourteenth Amendment. The kind of burden that was thought possible in the Hall and Morgan cases, therefore, simply cannot exist here. It is, of course, possible that States could impose such onerous, harassing, and conflicting conditions on an interstate carrier's hiring of employees that the burden would hamper the carrier's satisfactory performance of its functions. But that is not this case. We hold that the Colorado statute as applied here to prevent discrimination in hiring on account of race does not impose a constitutionally prohibited burden upon interstate commerce.
11
Third. Continental argues that federal law has so pervasively covered the field of protecting people in interstate commerce from racial discrimination that the States are barred from enacting legislation in this field. It is not contended, however, that the Colorado statute is in direct conflict with federal law,8 that it denies rights granted by Congress,9 or that it stands as an obstacle to the full effectiveness of a federal statute.10 Rather Continental argues that:
12
'When Congress has taken the particular subject-matter in hand, coincidence is as ineffective as opposition, and a state law is not to be declared a help because it attempts to go farther than Congress has seen fit to go.'11
13
But this Court has also said that the mere 'fact of identity does not mean the automatic invalidity of State measures.'12 To hold that a state statute identical in purpose with a federal statute is invalid under the Supremacy Clause, we must be able to conclude that the purpose of the federal statute would to some extent be frustrated by the state statute. We can reach no such conclusion here.
14
Continental relies first on the Civil Aeronautics Act of 1938,13 now the Federal Aviation Act of 1958,14 and its broad general provisions for forbidding air carriers to subject any particular person to 'any unjust discrimination or any undue or unreasonable prejudice or disadvantage in any respect whatsoever'15 and requiring 'The promotion of adequate, economical, and efficient service by air carriers at reasonable charges, without unjust discriminations, undue preferences or advantages, or unfair or destructive competitive practices * * *.'16 This is a familiar type of regulation, aimed primarily at rate discrimination injurious to shippers, competitors, and localities.17 But we may assume, for present purposes, that these provisions prohibit racial discrimination against passengers and other customers18 and that they protect job applicants or employees from discrimination on account of race. The Civil Aeronautics Board and the Administrator of the Federal Aviation Agency have indeed broad authority over flight crews of air carriers,19 much of which has been exercised by regulations.20 Notwithstanding this broad authority, we are satisfied that Congress in the Civil Aeronautics Act of 1938 and its successor had no express or implied intent to bar state legislation in this field and that the Colorado statute, at least so long as any power the Civil Aeronautics Board may have remains 'dormant and unexercised,'21 will not frustrate any part of the purpose of the federal legislation.22
15
There is even less reason to say that Congress, in passing the Railway Labor Act23 and making certain of its provisions applicable to air carriers, intended to bar States from protecting employees against racial discrimination. No provision in the Act even mentions discrimination in hiring. It is true that in several cases we have held that the exclusive bargaining agents authorized by the Act must not use their powers to discriminate against minority groups whom they are supposed to represent.24 And we have held that employers too may be enjoined from carrying out provisions of a discriminatory bargaining agreement.25 But the duty the Act imposes is one of fair representation and it is imposed upon the union. The employer is merely prohibited from aiding the union in breaching its duty. Nothing in the Railway Labor Act or in our cases suggests that the Act places upon an air carrier a duty to engage only in fair nondiscriminatory hiring practices. The Act has never been used for that purpose, and we cannot hold it bars Colorado's Anti-Discrimination Act.
16
Finally, we reject the argument that Colorado's Anti-Discrimination Act cannot constitutionally be enforced because of Executive Orders requiring government contracting agencies to include in their contracts clauses by which contractors agree not to discriminate against employees or applicants because of their race, religion, color, or national origin.26 The District Court purported to take judicial notice that 'a certificated commercial carrier by air (such as respondent) is obligated to and in fact does transport United States mail under contract with the United States Government.' The Government answers that in fact it has no contract with Continental and that, while 49 U.S.C. § 1375 requires air lines to carry mail, it does not forbid discrimination on account of race or compel the execution of a contract subject to Executive Orders. We do not rest on this ground alone, however, nor do we reach the question of whether an Executive Order can foreclose state legislation. It is impossible for us to believe that the Executive intended for its orders to regulate air carrier discrimination among employees so pervasively as to preempt state legislation intended to accomplish the same purpose.
17
The judgment of the Supreme Court of Colorado is reversed and the cause is remanded for further proceedings not inconsistent with this opinion.
18
It is so ordered.
19
Reversed and remanded with directions.
1
Colo.Rev.Stat.Ann. (Supp.1960) § 80—24—6.
2
The Commission also found that Continental was 'guilty of a discriminatory and unfair employment practice in requiring on its application form, the racial identity of the applicant and the requirement of a photo to be attached to the application,' contrary to the Commission's regulation.
3
44 Stat. 577, as amended, 45 U.S.C. §§ 151—188.
4
52 Stat. 973, as amended, 49 U.S.C. (1952 ed.) §§ 401—722, now Federal Aviation Act of 1958, 72 Stat. 731, 49 U.S.C. §§ 1301 1542.
5
It is not claimed in this case that the Colorado Act discriminated against interstate commerce, see, e.g., Best & Co. v. Maxwell, 311 U.S. 454, 61 S.Ct. 334, 85 L.Ed. 275 (1940), or that it places a substantial economic burden on Continental, see, e.g., Bibb v. Navajo Freight Lines, 359 U.S. 520, 79 S.Ct. 962, 3 L.Ed.2d 1003 (1959).
6
See, e.g., California v. Thompson, 313 U.S. 109, 61 S.Ct. 930, 85 L.Ed. 1219 (1941); Erie R. Co. v. Williams, 233 U.S. 685, 34 S.Ct. 761, 58 L.Ed. 1155 (1914).
7
E.g., Brown v. Board of Education, 347 U.S. 483. 74 S.Ct. 686, 98 L.Ed. 873 (1954); Bolling v. Sharpe, 347 U.S. 497, 74 S.Ct. 693, 98 L.Ed. 884 (1954); Bailey v. Patterson, 369 U.S. 31, 82 S.Ct. 549, 7 L.Ed.2d 512 (1962).
8
See McDermott v. Wisconsin, 228 U.S. 115, 33 S.Ct. 431, 57 L.Ed. 754 (1913).
9
See, e.g., United Mine Workers v. Arkansas Oak Flooring Co., 351 U.S. 62, 76 S.Ct. 559, 100 L.Ed. 941 (1956).
10
See, e.g., Hill v. Florida ex rel. Watson, 325 U.S. 538, 65 S.Ct. 1373, 89 L.Ed. 1782 (1945); Hines v. Davidowitz, 312 U.S. 52, 61 S.Ct. 399, 85 L.Ed. 581 (1941).
11
Charleston & W.C.R. Co. v. Varnville Furniture Co., 237 U.S. 597, 604, 35 S.Ct. 715, 717, 59 L.Ed. 1137 (1915).
12
California v. Zook, 336 U.S. 725, 730, 69 S.Ct. 841, 843, 93 L.Ed. 1005 (1949).
13
52 Stat. 973, as amended, 49 U.S.C. (1952 ed.) §§ 401 722.
14
The Civil Aeronautics Act of 1938 was substantially reenacted by the Federal Aviation Act of 1958, 72 Stat. 731, 49 U.S.C. §§ 1301—1542. Some of the powers and duties of the Civil Aeronautics Board were transferred to the Administrator of the Federal Aviation Agency.
15
49 U.S.C. (1952 ed.) § 484(b), now 49 U.S.C. § 1374(b).
16
49 U.S.C. (1952 ed.) § 402(c), now 49 U.S.C. § 1302(c).
17
Compare Interstate Commerce Act § 3(1), 49 U.S.C. § 3(1).
18
See Fitzgerald v. Pan American World Airways, 229 F.2d 499 (C.A.2d Cir., 1956); United States v. City of Montgomery, 201 F.Supp. 590 (M.D.Ala.1962); cf. Henderson v. United States, 339 U.S. 816, 70 S.Ct. 843, 94 L.Ed. 1302 (1950); Mitchell v. United States, 313 U.S. 80, 61 S.Ct. 873, 85 L.Ed. 1201 (1941).
19
See 49 U.S.C. (1952 ed.) §§ 552, 559, now 49 U.S.C. §§ 1422, 1429.
20
See, e.g., 14 CFR §§ 20.40, 20.42—20.45, 20.121, 21.1, 40.300.
21
Bethlehem Steel Co. v. New York State Labor Rel. Bd., 330 U.S. 767, 775, 67 S.Ct. 1026, 1031, 91 L.Ed. 1234 (1947). See Parker v. Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed. 315 (1943); H. P. Welch Co. v. New Hampshire, 306 U.S. 79, 59 S.Ct. 438, 83 L.Ed. 500 (1939).
22
If the federal authorities seek to deal with discrimination in hiring practices and their power to do so is upheld that would raise questions not presented here. Compare California v. Thompson, 313 U.S. 109, 61 S.Ct. 930, 85 L.Ed. 1219 (1941), with California v. Zook, 336 U.S. 725, 69 S.Ct. 841, 93 L.Ed. 1005 (1949).
23
44 Stat. 577, as amended, 45 U.S.C. §§ 151—188.
24
See, e.g., Conley v. Gibson, 355 U.S. 41, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957); Steele v. Louisville & Nashville R. Co., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173 (1944).
25
See, e.g., Brotherhood of R. Trainmen v. Howard, 343 U.S. 768, 775, 72 S.Ct. 1022, 1026, 96 L.Ed. 1283 (1952).
26
Executive Order No. 10479, 18 Fed.Reg. 4899 (Aug. 13, 1953), Executive Order No. 10557, 19 Fed.Reg. 5655 (Sept. 3, 1954), both revoked and superseded by Executive Order No. 10925, 26 Fed.Reg. 1977 (March 6, 1961).
| 910
|
373 U.S. 61
83 S.Ct. 1053
10 L.Ed.2d 195
Ford T. JOHNSON, Jr.,v.STATE OF VIRGINIA.
No. 715.
April 29, 1963.
PER CURIAM.
1
The petition for a writ of certiorari is granted, the judgment of the Supreme Court of Appeals of Virginia is reversed, and the case is remanded for proceedings not inconsistent with this opinion.
2
The petitioner, Ford T. Johnson, Jr., was convicted of contempt of the Traffic Court of the City of Richmond, Virginia, and appealed his conviction to the Hustings Court, where he was tried without a jury and again convicted. The Supreme Court of Appeals of Virginia refused to grant a writ of error on the ground that the judgment appealed from was 'plainly right,' but the Chief Justice of that court stayed execution of the judgment pending disposition of this petition for certiorari.
3
The evidence at petitioner's trial in the Hustings Court is summarized in an approved statement of facts. According to this statement, the witnesses for the State testified as follows: The petitioner, a Negro, was seated in the Traffic Court in a section reserved for whites, and when requested to move by the bailiff, refused to do so. The judge then summoned the petitioner to the bench and instructed him to be seated in the right-hand section of the courtroom, the section reserved for Negroes. The petitioner moved back in front of the counsel table and remained standing with his arms folded, stating that he preferred standing and indicating that he would not comply with the judge's order. Upon refusal to obey the judge's further direction to be seated, the petitioner was arrested for contempt. At no time did he behave in a boisterous or abusive manner, and there was no disorder in the courtroom. The State, in its Brief in Opposition filed in this Court, concedes that in the section of the Richmond Traffic Court reserved for spectators, seating space 'is assigned on the basis of racial designation, the seats on one side of the aisle being for use of Negro citizens and the seats on the other side being for the use of white citizens.'
4
It is clear from the totality of circumstances, and particularly the fact that the petitioner was peaceably seated in the section reserved for whites before being summoned to the bench, that the arrest and conviction rested entirely on the refusal to comply with the segregated seating requirements imposed in this particular courtroom. Such a conviction cannot stand, for it is no longer open to question that a State may not constitutionally require segregation of public facilities. See, e.g., Brown v. Board of Education, 347 U.S. 483, 74 S.Ct. 686, 98 L.Ed. 873; Mayor and City Council of Baltimore v. Dawson, 350 U.S. 877, 76 S.Ct. 133, 100 L.Ed. 774; Turner v. Memphis, 369 U.S. 350, 82 S.Ct. 805, 7 L.Ed.2d 762. State-compelled segregation in a court of justice is a manifest violation of the State's duty to deny no one the equal protection of its laws.
5
Reversed and remanded.
| 12
|
373 U.S. 33
83 S.Ct. 1059
10 L.Ed.2d 172
BROTHERHOOD OF LOCOMOTIVE ENGINEERS et al., Petitioners,v.LOUISVILLE AND NASHVILLE RAILROAD COMPANY.
No. 94.
Argued Feb. 21, 1963.
Decided April 29, 1963.
Harold C. Heiss, Cleveland, Ohio, for petitioners.
John P. Sandidge, Louisville, Ky., for respondent.
Mr. Justice STEWART delivered the opinion of the Court.
1
The respondent railroad company dismissed an employee named Humphries on the ground that he had assaulted two fellow employees. His union, the Brotherhood of Locomotive Firemen and Enginemen, protested the discharge. The customary grievance procedures on the property were invoked, but to no avail. To enforce its demand that Humphries be reinstated, the union threatened to call a strike. Before a strike was actually called, the respondent submitted the dispute to the National Railroad Adjustment Board, pursuant to § 3 First (i) of the Railway Labor Act.1 The Adjustment Board sustained the employee's claim for reinstatement in the following brief order:
2
'Claim sustained with pay for time lost as the rule is construed on the property.'
3
The respondent reinstated Humphries, and, for the purpose of computing his pay for lost time, it asked him to submit a record of the outside income he had earned during the period which followed his dismissal. Humphries and his union resisted this demand for information, claiming that the Adjustment Board's award entitled him to full pay for the time lost, without deduction for outside income.
4
Several conferences were called to discuss this dispute. When the respondent refused to accede to the union's interpretation of the award's lost-time provision, the union again threatened to call a strike. To forestall the impending work stoppage, the respondent twice petitioned the Adjustment Board to resolve the dispute as to the amount due Humphries under the award, asking the Board first for a clarification of its earlier order and then submitting the disputed issue for resolution in a separate de novo proceeding. The Adjustment Board refused to entertain either petition, stating in its second order that 'The matter must be judged res judicata' in light of the original Adjustment Board decision dealing with the Humphries controversy.
5
After the respondent had submitted the dispute for the second time to the Adjustment Board, the union set a definite strike deadline. The respondent then brought the present lawsuit in a Federal District Court, requesting injunctive relief against the threatened strike. After the Adjustment Board proceedings were completed, the court issued the injunction, holding that under the Railway Labor Act the union could not legally strike for the purpose of enforcing its interpretation of the Board's money award, but must instead utilize the judicial enforcement procedure provided by § 3 First (p) of the Act.2 190 F. Supp. 829. The Court of Appeals for the Sixth Circuit affirmed, 297 F.2d 608, and we granted certiorari to consider an obviously substantial question affecting the administration of the Railway Labor Act. 370 U.S. 908, 82 S.Ct. 1255, 8 L.Ed.2d 403. For the reasons stated in this opinion, we conclude that the District Court and the Court of Appeals correctly decided the issues presented, and we accordingly affirm the judgment before us.
6
The statute governing the central issue in this case is § 3 First of the Railway Labor Act, covering so-called 'minor disputes.'3 The present provisions of § 3 First were added to the Act in 1934.4 The historical background of these provisions has been described at length in previous opinions of this Court. See Elgin, J. & E.R. Co. v. Burley, 325 U.S. 711, 65 S.Ct. 1282, 89 L.Ed. 1886; Brotherhood of R. R. Trainmen v. Chicago R. & I.R. Co., 353 U.S. 30, 77 S.Ct. 635, 1 L.Ed.2d 622; Union Pacific R. Co. v. Price, 360 U.S. 601, 79 S.Ct. 1351, 3 L.Ed.2d 1460. As explained in detail in those opinions, the 1934 amendments were enacted because the scheme of voluntary arbitration contained in the original Railway Labor Act5 had proved incapable of achieving peaceful settlements of grievance disputes. To arrive at a more efficacious solution, Congress, at the behest of the several interests involved, settled upon a new detailed and comprehensive statutory grievance procedure.
7
Subsections (a) to (h) of § 3 First create the National Railroad Adjustment Board and define its composition and duties.6 Subsection (i) provides that it shall be the duty of both the carrier and the union to negotiate on the property concerning all minor disputes which arise; failing adjustment by this means, 'the disputes may be referred by petition of the parties or by either party to the appropriate division of the Adjustment Board * * *.'7 Subsection (l) directs the appointment of a neutral referee to sit on the Adjustment Board in the event its regular members are evently divided.8 Subsection (m) makes awards of the Adjustment Board 'final and binding upon both parties to the dispute, except insofar as they shall contain a money award.' It further directs the Adjustment Board to entertain a petition for clarification of its award if a dispute should arise over its meaning.9 And finally, subsections (o) and (p) describe the manner in which Adjustment Board awards may be enforced, providing for the issuance of an order by the Board itself and for judicial action to enforce such orders.10
8
The several decisions of this Court interpreting § 3 First have made it clear that this statutory grievance procedure is a mandatory, exclusive, and comprehensive system for resolving grievance disputes. The right of one party to place the disputed issue before the Adjustment Board, with or without the consent of the other, has been firmly established. Brotherhood of R.R. Trainmen v. Chicago R. & I.R. Co., 353 U.S., at 34, 77 S.Ct., at 637. And the other party may not defeat this right by resorting to some other forum. Thus, in Order of Ry. Conductors of America v. Southern R. Co., 339 U.S. 255, 70 S.Ct. 585, 94 L.Ed. 811, the Court held that a state court could not take jurisdiction over an employer's declaratory judgment action concerning an employee grievance subject to § 3 First, because, 'if a carrier or a union could choose a court instead of the Board, the other party would be deprived of the privilege conferred by § 3, First (i) * * * which provides that after negotiations have failed 'either party' may refer the dispute to the appropriate division of the Adjustment Board.' Id., at 256—257, 70 S.Ct., at 586. See Slocum v. Delaware, L. & W.R. Co., 339 U.S. 239, 70 S.Ct. 577, 94 L.Ed. 795. Similarly, an employee is barred from choosing another forum in which to litigate claims arising under the collective agreement. Pennsylvania R. Co. v. Day, 360 U.S. 548, 552—553, 79 S.Ct. 1322, 1324—1325, 3 L.Ed. 1422. A corollary of this view has been the principle that the process of decision through the Adjustment Board cannot be challenged collaterally by methods of review not provided for in the statute. In Union Pacific R. Co. v. Price, 360 U.S. 601, 79 S.Ct. 1351, 3 L.Ed.2d 1460, the Court held that an employee could not resort to a common law action for wrongful discharge after the same claim had been rejected on the merits in a proceeding before the Adjustment Board. The decision in that case was based upon the conclusion that, when invoked, the remedies provided for in § 3 First were intended by Congress to be the complete and final means for settling minor disputes. 360 U.S., at 616—617, 79 S.Ct., at 1359. See also, Washington Terminal Co. v.Boswell, 75 U.S.App.D.C. 1, 124 F.2d 235 (per Rutledge, J.), aff'd by an equally divided court, 319 U.S. 732, 63 S.Ct. 1430, 87 L.Ed. 1694.
9
Of even more particularized relevance to the issue now before us is this Court's decision in Brotherhood of R.R. Trainmen v. Chicago R. & I.R. Co., supra. There the railroad had submitted several common grievances to the Adjustment Board pursuant to § 3 First (i). The union had resisted the submission, and called a strike to enforce its grievance demands. The Court held that the strike violated those provisions of the Act making the minor dispute procedures compulsory on both parties. In an opinion which reviewed at length the legislative history of the 1934 amendments, the Court concluded that this history entirely supported the plain import of the statutory language—that Congress had intended the grievance procedures of § 3 First to be a compulsory substitute for economic self-help, not merely a voluntary alternative to it. For this reason, the Court concluded that the Norris-LaGuardia LaGuardia Act, 29 U.S.C. §§ 101—115, was not a bar to injunctive relief against strikes called in support of grievance disputes which had been submitted to the National Railroad Adjustment Board.11
10
It is against this pattern of decisions that we must evaluate the petitioners' claim that the District Court in the present case was wrong in enjoining the threatened strike. The claim, simply stated, is that the power to issue injunctions recognized by the Chicago River decision is limited to those situations in which a strike is called during the proceedings before the Adjustment Board. Once a favorable award has been rendered, say the petitioners, the union becomes free to enforce the award as it will—by invoking the judicial enforcement procedures of § 3 First (p), or by resorting to economic force. The right to strike, it is argued, is necessary to achieve 'the congressional policy of requiring carriers and their employees to settle grievances by the collective bargaining process.'
11
The broad premise of the petitioners' argument—that Congress intended to permit the settlement of minor disputes through the interplay of economic force—is squarely in conflict with the basic teaching of Chicago River. After a detailed analysis of the historic background of the 1934 Act, the Court there determined that 'there was general understanding between both the supporters and the opponents of the 1934 amendment that the provisions dealing with the Adjustment Board were to be considered as compulsory arbitration in this limited field.' 353 U.S., at 39, 77 S.Ct., at 640.
12
The petitioners' narrower argument—that, at the least, strikes may be permitted after the Adjustment Board makes an award is likewise untenable under the circumstances of this case. We do not deal here with non-money awards, which are made 'final and binding' by § 3 First (m).12 The only portion of the award which presently remains unsettled is the dispute concerning the computations of Humphries' 'time lost' award, an issue wholly separable from the merits of the wrongful discharge issue. This, then, is clearly a controversy concerning a 'money award,' as to which decisions of the Adjustment Board are not final and binding.13 Instead, the Act provides a further step in the settlement process. If the carrier does not comply with the award, or with the employee's or union's interpretation of it, § 3 First (p) authorizes the employee to bring an action in a Federal District Court to enforce the award.14 The lawsuit is to 'proceed in all respects as other civil suits,' but the findings and order of the Adjustment Board are to be regarded as 'prima facie evidence' of the facts stated in the complaint. The employee is excused from the costs of suit, and, in addition, is awarded attorney's fees if he prevails. The total effect of these detailed provisions is to provide a carefully designed procedure for reviewing money awards, one which will achieve the reviewing function without any significant expense to the employee or his union. See Washington Terminal Co. v. Boswell, supra.
13
The express provision for this special form of judicial review for money awards, both in subsection (m) and again in subsection (p), makes it clear that Congress regarded this procedure as an integral part of the Act's grievance machinery. Congress has, in effect, decreed a two-step grievance procedure for money awards, with the first step, the Adjustment Board order and findings, serving as the foundation for the second. Money awards against carriers cannot be made final by any other means. To allow one of the parties to resort to economic self-help at this point in the process would violate this direct statutory command. It would permit that party to withdraw at will from the process of settlement which Congress has expressly required both parties to follow. In addition, it would obviously render the earlier parts of the grievance procedure totally meaningless.
14
A strike in these circumstances would therefore be no less disruptive of the explicit statutory grievance procedure than was the strike enjoined in the Chicago River case. Consequently, the reasons which, in that case, required accommodating the more generalized provisions of the Norris-LaGuardia Act apply with equal force to the present case.15 We hold that the District Court was not in error in issuing the injunction.
15
Affirmed.
16
Mr. Justice BLACK dissents.
17
Mr. Justice GOLDBERG, with whom Mr. Justice DOUGLAS joins, dissenting.
18
This Court's decision in the Chicago River case, Brotherhood of R.R. Trainmen v. Chicago R. & I.R. Co., 353 U.S. 30, 77 S.Ct. 635, 1 L.Ed.2d 622, holds that strikes are excluded pending grievance proceedings over 'minor disputes' before the Adjustment Board. Though this is all that Chicago River holds, the Court today impliedly reads it to mean and, indeed, there is language in Chicago River to the effect that Congress is to be taken as having elected in favor of a comprehensive and wholly exclusive system of compulsory arbitration and as having outlawed all use of economic force in the form of a strike at any stage of a 'minor dispute' which is subject to consideration by the Adjustment Board. The logic of Chicago River is that 'final and binding' awards of the Adjustment Board are enforceable in favor of, or against, either the employer railroad, the union, or the grievant employee in the federal courts. Given the premises of Chicago River, it must follow that such enforcement proceedings are governed by federal law as declared by this Court in cases such as United Steelworkers of America v. American Mfg. Co., 363 U.S. 564, 80 S.Ct. 1343, 4 L.Ed.2d 1403, United Steelworkers of America, AFL-CIO v. Warrior & Gulf Co., 363 U.S. 574, 80 S.Ct. 1347, 4 L.Ed.2d 1409, andUnited Steelworkers of America v. Enterprise, etc., Corp., 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424, and, of course, that the merits of such awards are not subject to de novo consideration upon a petition for judicial enforcement. See International Ass'n of Machinists, AFL-CIO v. Central Airlines, 372 U.S. 682, 83 S.Ct. 956.
19
Here, however, unlike Chicago River, the Adjustment Board proceedings have ended; moreover, we are dealing not with a nonmoney award which is made specifically 'final and binding' by the statute, but with a money award which, as the majority recognizes, is governed by different considerations and is treated differently in the statute itself. A money award by the Board is expressly declared by the Act not to be 'final and binding.' The enforcement machinery contained in subsection (p) of the Act—which the Court's opinion inferentially suggests is confined to money awards, and which I would expressly declare to be so limited1 contemplates for such awards not that limited type of review applicable to 'final and binding' nonmoney awards, but a de novo trial before the court, subject only to the limitation, as the statute requires, that the findings of fact of the Board shall constitute 'prima facie' evidence. Under such circumstances, the logic of Chicago River in excluding strikes in favor of an exclusive scheme of 'compulsory arbitration' seems to me to have no application, for here we are dealing with nonfinal and nonbinding awards, the direct antithesis of a compulsory arbitration scheme.
20
In addition, the Court's opinion leads to what seems to me to be a wholly anomalous result plainly never intended by Congress. What was merely expressed as dicta in Union Pac. R. Co. v. Price, 360 U.S. 601, 79 S.Ct. 1351, 3 L.Ed.2d 1460, is apparently reinforced by today's holding. In Price, the Court said, though the question was not before it, that a strike against an Adjustment Board award denying a money claim of a grievant could be enjoined in the federal courts under the rationale of Chicago River. See 360 U.S., at 611, n. 10, 79 S.Ct., at 1357. The Court here holds that a strike to enforce a money award favorable to the claimant is forbidden even when the carrier refuses to abide thereby. In so holding, the Court cites Price with apparent approval and its language supports the result declared by the Price dicta. Thus, as of today, it appears even more clearly that a grievant filing a money claim which is denied by the Adjustment Board is finally bound by the result and may neither bring an independent suit on his claim (the holding of Price2), nor, presumably, utilize economic pressure, i.e., the strike, in support of his claim (the purport of the Price dicta and the thrust of today's holding), nor even seek further judicial review of the merits of his claim since the literal language of subsection (p) applies only to awards in the claimant's favor. The carrier will have no reason to seek further judicial review because the award is favorable to it and both the unsuccessful grievant and the union are without effective means to prevent its enforcement. Thus, under today's opinion and the prior cases cited therein, the grievant whose money claim is denied by the Board is wholly without further remedy or recourse.
21
Such complete foreclosure of a losing money claimant would be less objectionable were it not for the wholly disparate consequences obtaining as a result of today's decision when it is the carrier who loses on a money claim before the Board. If this occurs, the carrier is free to refuse to comply, as it did here; since today's opinion forecloses other avenues of relief to the successful grievant and his union, the carrier, by such recalcitrance, can compel a suit to enforce the award under subsection (p), which requires an entire retrial of the issues in court. During this lengthy procedure and, presumably, even at its conclusion, the grievant and the union will be left without economic or other recourse. The net result, therefore, is that on all money claims, the award of the Board is 'final and binding,' and not subject to further review or other challenge, if the claimant loses, but it is subject to de novo review and trial at the sole behest of the employer, if the employer loses. And in either case, apparently, the union is completely foreclosed even from using its most traditional weapon, the strike. I cannot believe that Congress intended such an unevenhanded application of the statute. Nor can I believe, as the Court holds, that Congress could have contemplated that the protection of the right to strike afforded by the Norris-LaGuardia Act was being rescinded in favor of such an inadequate and unfair procedure as the Court declares the Act to have created.
22
Absent a willingness to permit equally broad de novo review to a grievant whose money claim is denied by the Board,3 a reading of the statute which admittedly seems contrary to literal words of subsection (p), the only interpretation which provides a semblance of fairness in this situation is one which interprets congressional intent to be that, in money-claim cases at least, the right to strike—while perhaps suspended during Adjustment Board proceedings—is available either if the Board decides for the claimant and the carrier does not comply, or if the Board decides for the carrier and the claimant does not acquiesce. This at least would not leave the entire balance in money cases in favor of the carrier.
23
The suggested result is in no way foreclosed by Chicago River, which did not treat of the difference between enforcement of money and nonmoney awards once made, nor by Price, since that case did not deal with the right to strike, and is distinguishable on the ground that there, having once resorted to the Adjustment Board, the losing grievant could not, under traditional election-of-remedy principles, relitigate the same issues afresh by bringing an independent, unrelated common-law action in another forum.4
24
My ultimate view, therefore, is that Congress—whatever its intent with respect to impliedly repealing the Norris-LaGuardia Act in nonmoney cases in which the Board's decision is expressly made final and binding—cannot fairly be deemed to have intended such a repeal in money-award cases, in which the Board's decisions are expressly not final and binding. The legislative history is not merely uninstructive as to today's result; it clearly demonstrates that Congress never focused on or considered the problem here raised, or even recognized the anomaly today's opinion in part effects and in part portends. Notwithstanding, the Court has read Congress as intending allowance of what in Chicago River was described as an injunction which 'strips labor of its primary weapon without substituting any reasonable alternative.' 353 U.S., at 41, 77 S.Ct., at 640. To impute so drastic a result without any clear indication that it was intended seems to me to be unwarranted.
25
I reach these conclusions reluctantly since I believe that arbitration of grievances is, in general, a salutary policy in the field of labor-management relations and contributes substantially to industrial peace. Wholly apart from questions as to the general desirability of compulsory arbitration, the results flowing from Chicago River would, in these terms, be commendable, assuming that the normally cumbersome and slow procedures of the Adjustment Board could be expedited to achieve the efficacy and efficiency typical of private labor arbitrations and essential to success of the process. The court procedure under subsection (p) of the Act, which today is made an integral, if not mandatory, part of the statutory grievance machinery, will, however, only increase the already undue delay in resolution of grievances.5 Moreover, the de novo nature of the requisite court trial on review under subsection (p) runs directly contrary to the best view of the treatment to be judicially accorded such awards. See, e.g., United Steelworkers of America v. Enterprise, etc., Corp., supra, 363 U.S., 596—599, 80 S.Ct., 1360—1362. These latter considerations do not themselves compel my conclusion here, however, for standing alone they are the result of policy determinations which, in this instance, either have already been made by, or are more properly committed to, Congress as direct consequences of the literal statutory scheme. They are, nonetheless, relevant factors in appraising the propriety and wisdom of the Court's construction of the statute and its estimate of the intention of its framers.
26
Thus, with all deference, I must respectfully dissent from today's opinion since, though neither mandated by this Court's prior holdings nor supported, much less compelled, by specific congressional intent, it creates additional exceptions to the Norris-LaGuardia Act protections and does so in a fashion which effects, in my view, an unfair imbalance, if not outright clear advantage, in favor of the carrier and against the employee and his union.
1
'(i) The disputes between an employee or group of employees and a carrier or carriers growing out of grievances or out of the interpretation or application of agreements concerning rates of pay, rules, or working conditions, including cases pending and unadjusted on June 21, 1934, shall be handled in the usual manner up to and including the chief operating officer of the carrier designated to handle such disputes; but, failing to reach an adjustment in this manner, the disputes may be referred by petition of the parties or by either party to the appropriate division of the Adjustment Board with a full statement of the facts and all supporting data bearing upon the disputes.' 45 U.S.C. § 153 First (i).
2
'(p) If a carrier does not comply with an order of a division of the Adjustment Board within the time limit in such order, the petitioner, or any person for whose benefit such order was made, may file in the District Court of the United States for the district in which he resides or in which is located the principal operating office of the carrier, or through which the carrier operates, a petition setting forth briefly the causes for which he claims relief, and the order of the division of the Adjustment Board in the premises. Such suit in the District Court of the United States shall proceed in all respects as other civil suits, except that on the trial of such suit the findings and order of the division of the Adjustment Board shall be prima facie evidence of the facts therein stated, and except that the petitioner shall not be liable for costs in the district court nor for costs at any subsequent stage of the proceedings, unless they accrue upon his appeal, and such costs shall be paid out of the appropriation for the expenses of the courts of the United States. If the petitioner shall finally prevail he shall be allowed a reasonable attorney's fee, to be taxed and collected as a part of the costs of the suit. The district courts are empowered, under the rules of the court governing actions at law, to make such order and enter such judgment, by writ of mandamus or otherwise, as may be appropriate to enforce or set aside the order of the division of the Adjustment Board.' 45 U.S.C. § 153 First (p).
3
There can be no doubt that the controversy over the amount of the 'time lost' award is a minor dispute, because it involves 'the interpretation or application' of the collective agreement between the railroad and the union. See note 1, supra. See also, Elgin, J. & E.R. Co. v. Burley, 325 U.S. 711, 65 S.Ct. 1282, 89 L.Ed. 1886; Brotherhood of R. R. Trainmen v. Chicago R. & I.R. Co., 353 U.S. 30, 77 S.Ct. 635, 1 L.Ed.2d 622.
4
48 Stat. 1185, 1189 (1934).
5
44 Stat. 577, 578 (1926).
6
45 U.S.C. § 153 First (a)—(h).
7
See note 1, supra.
8
45 U.S.C. § 153 First (l).
9
'(m) The awards of the several divisions of the Adjustment Board shall be stated in writing. A copy of the awards shall be furnished to the respective parties to the controversy, and the awards shall be final and binding upon both parties to the dispute, except insofar as they shall contain a money award. In case a dispute arises involving an interpretation of the award, the division of the Board upon request of either party shall interpret the award in the light of the dispute.' 45 U.S.C. § 153 First (m).
10
'(o) In case of an award by any division of the Adjustment Board in favor of petitioner, the division of the Board shall make an order, directed to the carrier, to make the award effective and, if the award includes a requirement for the payment of money, to pay to the employee the sum to which he is entitled under the award on or before a day named.' 45 U.S.C. § 153 First (o).
The language of § 3 First (p) is set out in note 2, supra.
11
'(The Norris-LaGuardia Act was designed primarily) to prevent the injunctions of the federal courts from upsetting the natural interplay of the competing economic forces of labor and capital. Rep. LaGuardia * * * recognized that the machinery of the Railway Labor Act channeled these economic forces, in matters dealing with railway labor, into special processes intended to compromise them. Such controversies, therefore, are not the same as those in which the injunction strips labor of its primary weapon without substituting any reasonable alternative.' 353 U.S., at 40—41, 77 S.Ct., at 640—641. Cf. Manion v. Kansas City Terminal R. Co., 353 U.S. 927, 77 S.Ct. 706, 1 L.Ed.2d 722, which held that injunctive relief is not available if the processes of the Railway Labor Act have not actually been invoked. Compare Sinclair Refining Co. v. Atkinson, 370 U.S. 195, 210—212, 82 S.Ct. 1328, 1336—1337, 8 L.Ed.2d 440.
12
See note 9, supra.
13
See note 9, supra.
14
See note 2, supra.
15
See note 11, supra.
1
A common sense and practical reading of the statutory provisions seems to me to compel the conclusion that subsection (p) is confined in its application to money claims. Subsection (m) makes all nonmoney awards 'final and binding' and any reading of subsection (p) which allowed de novo review of the merits of such awards would be directly contradictory to the effect expressly accorded to them. Moreover, subsection (o) provides that if the claimant wins, the Board shall enter an 'order, directed to the carrier, to make the award effective' and that, in cases involving a money award, such order shall require payment by a day certain. Such detailed direction with respect to the money-award order would appear exclusively complementary to the provision in subsection (p), the immediately succeeding section, which provides for the de novo review only in cases in which a losing carrier does not comply with the award 'within the time limit in such order.' (The relevant subsections of the Act are set out in notes 2, 9, and 10, of the Court's opinion, ante, pp. 35, 37.
2
See also Pennsylvania R. Co. v. Day, 360 U.S. 548, 79 S.Ct. 1322, 3 L.Ed.2d 1422.
3
Cf. United States v. Interstate Commerce Comm., 337 U.S. 426, 69 S.Ct. 1410, 93 L.Ed. 1451.
4
In fact, the manner in which the Court in Price distinguished its earlier decision in Moore v. Illinois Central R. Co., 312 U.S. 630, 61 S.Ct. 754, 85 L.Ed. 1089, suggests this very rationale. See 360 U.S., at 609, n. 8, 79 S.Ct., at 1355.
5
While the Adjustment Board handles and disposes of an impressive number of cases each year, the backlog of pending disputes is immense. During its 1962 fiscal year, a total of 997 cases were disposed of by decision and 383 cases were withdrawn. During the same period, however, 1,873 new cases were docketed. The total of 1,380 cases thus removed from the docket during the year still fell almost 500 cases short of equalling the number of new grievances filed. At the end of the year, the Board had still pending before it some 6,461 cases, of which only 1,679 had been heard. By way of comparison, though there were 4,948 cases pending at the end of fiscal year 1958, only 415 of these had not been heard. In only one of the past five fiscal years has the Board even come close to maintaining an equilibrium in its backlog by being able to dispose of almost as many cases as were docketed during the period. Twenty-eighth Annual Report of the National Mediation Board for fiscal year ended June 30, 1962, pp. 59, 86.
| 67
|
373 U.S. 57
83 S.Ct. 1052
10 L.Ed.2d 191
STATE OF HAWAII, Plaintiff,v.Kermit GORDON.
No. 12 Original.
Argued April 15, 1963.
Decided April 29, 1963.
Bert T. Kobayashi, Honolulu, Hawaii, and Dennis G. Lyons, Washington, D.C., for plaintiff.
Wayne G. Barnett, Washington, D.C., for defendant.
PER CURIAM.
1
Section 5(e) of the Hawaii Statehood Act, 73 Stat. 4, 48 U.S.C. (Supp. II, 1960), pp. 1257—1261, provides that within five years from the date Hawaii is admitted to the Union federal agencies having control over land or properties retained by the United States under § 5(c) and (d) of the Act shall report to the President as to the 'continued need for such land or property, and if the President determines that the land or property is no longer needed by the United States it shall be conveyed to the State of Hawaii.' The President designated the Director of the Bureau of the Budget to perform his functions thereunder. The Director thereafter, pursuant to an opinion of the Attorney General, 42 Op.Atty.Gen. (No. 4), concluded, and so advised federal agencies, that the lands referred to in § 5(e) do not include lands obtained by the United States through purchase, condemnation or gift but are limited to lands which at one time belonged to Hawaii and were ceded to the United States or acquired in exchange therefor.
2
Hawaii filed this original action against the Director, under Art. III, § 2, of the Constitution of the United States, seeking to obtain an order requiring him to withdraw this advice to the federal agencies, determine whether a certain 203 acres of land in Hawaii acquired by the United States through condemnation was land or properties 'needed by the United States' and, if not needed, to convey this land to Hawaii. We have concluded that this is a suit against the United States and, absent its consent, cannot be maintained by the State. The general rule is that relief sought nominally against an officer is in fact against the sovereign if the decree would operate against the latter. E.g., Dugan v. Rank, 372 U.S. 609, 83 S.Ct. 999 (1963); Malone v. Bowdoin, 369 U.S. 643, 82 S.Ct. 980, 8 L.Ed.2d 168 (1962); Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 69 S.Ct. 1457, 93 L.Ed. 1628 (1949). Here the order requested would require the Director's official affirmative action, affect the public administration of government agencies and cause as well the disposition of property admittedly belonging to the United States. The complaint is therefore dismissed. Oregon v. Hitchcock, 202 U.S. 60, 26 S.Ct. 568, 50 L.Ed. 935 (1906).
3
Dismissed.
4
Mr. Justice WHITE took no part in the consideration or decision of this case.
| 910
|
373 U.S. 59
83 S.Ct. 1050
10 L.Ed.2d 193
Robert Galloway WHITE, Petitioner,v.STATE OF MARYLAND.
No. 600.
Argued April 16, 1963.
Decided April 29, 1963.
Fred E. Weisgal, Baltimore, Md., for petitioner.
Robert F. Sweeney, Baltimore, Md., for respondent.
PER CURIAM.
1
Petitioner, who was sentenced to death while his codefendant was given life, appealed to the Maryland Court of Appeals which affirmed his conviction. 227 Md. 615, 177 A.2d 877. We granted certiorari 'limited to the point of law raised in Hamilton v. Alabama, 368 U.S. 52, 82 S.Ct. 157, 7 L.Ed.2d 114.' See 371 U.S. 909, 83 S.Ct. 259, 9 L.Ed.2d 169.
2
Petitioner was arrested on May 27, 1960, and brought before a magistrate on May 31, 1960, for a preliminary hearing. But that hearing was postponed and not actually held until August 9, 1960. At that time petitioner was not yet represented by a lawyer. When arraigned at that preliminary hearing he pleaded guilty. That Maryland calls the 'arraignment' was first held September 8, 1960; but since petitioner was not represented by counsel, his arraignment was postponed and counsel appointed for him on September 9, 1960. He was finally arraigned on November 25, 1960, and entered pleas of 'not guilty' and 'not guilty by reason of insanity.' At his trial the plea of guilty made at the preliminary hearing on August 9, 1960, was introduced in evidence.* Since he did not have counsel at the time of the preliminary hearing, he argued that Hamilton v. Alabama, supra, applied. The Court of Appeals disagreed, saying that arraignment in Alabama is 'a critical stage in a criminal proceeding' where rights are preserved or lost (368 U.S. 53—54, 82 S.Ct. 158), while under Maryland law there was 'no requirement (nor any practical possibility under our present criminal procedure) to appoint counsel' for petitioner at the preliminary hearing * * * nor was it necessary for appellant to enter a plea at that time.' 227 Md., at 625, 177 A.2d, at 882.
3
Whatever may be the normal function of the 'preliminary hearing' under Maryland law, it was in this case as 'critical' a state as arraignment under Alabama law. For petitioner entered a plea before the magistrate and that plea was taken at a time when he had no counsel.
4
We repeat what we said in Hamilton v. Alabama, supra, at 55, 82 S.Ct. at 159 that we do not stop to determine whether prejudice resulted: 'Only the presence of counsel could have enabled this accused to know all the defenses available to him and to plead intelligently.' We therefore hold that Hamilton v. Alabama governs and that the judgment below must be and is reversed.
5
Reversed.
*
Although petitioner did not object to the introduction of this evidence at the trial (227 Md., at 619—620, 177 A.2d, at 879), the rationale of Hamilton v. Alabama, supra, does not rest, as we shall see, on a showing of prejudice.
| 01
|
373 U.S. 1
83 S.Ct. 1068
10 L.Ed.2d 148
Charles Edward SANDERS, Petitioner,v.UNITED STATES.
No. 202.
Argued Feb. 25, 1963.
Decided April 29, 1963.
[Syllabus from pages 1-2 intentionally omitted]
Fred M. Vinson, Jr., Washington, D.C., for petitioner.
Miss Beatrice Rosenberg, Washington, D.C., for respondent.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
We consider here the standards which should guide a federal court in deciding whether to grant a hearing on a motion of a federal prisoner under 28 U.S.C. § 2255.1
2
Under that statute, a federal prisoner who claims that his sentence was imposed in violation of the Constitution or laws of the United States may seek relief from the sentence by filing a motion in the sentencing court stating the facts supporting his claim. '(A) prompt hearing' on the motion is required '(u)nless the motion and the files and records of the case conclusively show that the prisoner is entitled to no relief * * *.' The section further provides that '(t)he sentencing court shall not be required to entertain a second or successive motion for similar relief on behalf of the same prisoner.'
3
The petitioner is serving a 15-year sentence for robbery of a federally insured bank in violation of 18 U.S.C. § 2113(a). He filed two motions under § 2255. The first alleged no facts but only bare conclusions in support of his claim. The second, filed eight months after the first, alleged facts which, if true, might entitle him to relief. Both motions were denied, without hearing, by the District Court for the Northern District of California. On appeal from the denial of the second motion, the Court of Appeals for the Ninth Circuit affirmed. 297 F.2d 735. We granted leave to proceed in forma pauperis and certiorari. 370 U.S. 936, 82 S.Ct. 1592, 8 L.Ed.2d 806.
4
On January 19 ,1959, petitioner was brought before the United States District Court for the Northern District of California, and was handed a copy of a proposed information charging him with the robbery. He appeared without counsel. In response to inquiries of the trial judge, petitioner stated that he wished to waive assistance of counsel and to proceed by information rather than indictment;2 he signed a waiver of indictment, and then pleaded guilty to the charge in the information. On February 10 he was sentenced. Before sentence was pronounced, petitioner said to the judge: 'If possible, your Honor, I would like to go to Springfield or Lexington for addiction cure. I have been using narcotics off and on for quite a while.' The judge replied that he was 'willing to recommend that.' On January 4, 1960, petitioner, appearing pro se, filed his first motion. He alleged no facts but merely the conclusions that (1) the 'Indictment' was invalid, (2) 'Appellant was denied adequate assistance of Counsel as guaranteed by the Sixth Amendment,' and (3) the sentencing court had 'allowed the Appellant to be intimidated and coerced into intering (sic) a plea without Counsel, and any knowledge of the charges lodged against the Appellant.' He filed with the motion an application for a writ of habeas corpus ad testificandum requiring the prison authorities to produce him before the court to testify in support of his motion. On February 3 the District Court denied both the motion and the application. In a memorandum accompanying the denial, the court explained that the motion, 'although replete with conclusions, sets forth no facts upon which such conclusions can be founded. For this reason alone, this motion may be denied without a hearing.' Nevertheless, the court stated further that the motion 'sets forth nothing but unsupported charges, which are completely refuted by the files and records of this case. Since the motion and the files and records of the case conclusively show that the prisoner is entitled to no relief, no hearing on the motion is necessary.' No appeal was taken by the petitioner from this denial.
5
On September 8 petitioner, again appearing pro se, filed his second motion. This time he alleged that at the time of his trial and sentence he was mentally incompetent as a result of narcotics administered to him while he was held in the Sacramento County Jail pending trial. He stated in a supporting affidavit that he had been confined in the jail from on or about January 16, 1959, to February 18, 1959; that during this period and during the period of his 'trial' he had been intermittently under the influence of narcotics; and that the narcotics had been administered to him by the medical authorities in attendance at the jail because of his being a known addict. The District Court denied the motion without hearing, stating: 'As there is no reason given, or apparent to this Court, why petitioner could not, and should not, have raised the issue of mental incompetency at the time of his first motion, the Court will refuse, in the exercise of its statutory discretion, to entertain the present petition.' (Footnote omitted.) The court also stated that 'petitioner's complaints are without merit in fact.' On appeal from the order denying this motion, the Court of Appeals for the Ninth Circuit affirmed. 297 F.2d 735 (1961). The Court of Appeals said in a per curiam opinion: 'Where, as here, it is apparent from the record that at the time of filing the first motion the movant knew the facts on which the second motion is based, yet in the second motion set forth no reason why he was previously unable to assert the new ground and did not allege that he had previously been unaware of the significance of the relevant facts, the district court, may, in its discretion, decline to entertain the second motion.' 297 F.2d, at 736—737.
6
We reverse. We hold that the sentencing court should have granted a hearing on the second motion.
I.
7
The statute in terms requires that a prisoner shall be granted a hearing on a motion which alleges sufficient facts to support a claim for relief unless the motion and the files and records of the case 'conclusively show' that the claim is without merit. This is the first case in which we have been called upon to determine what significance, in deciding whether to grant a hearing, the sentencing court should attach to any record of proceedings on prior motions for relief which may be among the files and records of the case, in light of the provision that: 'The sentencing court shall not be required to entertain a second or successive motion for similar relief on behalf of the same prisoner.' This provision has caused uncertainty in the District Courts, see Bistram v. United States, 180 F.Supp. 501 (D.C.D.N.Dak.), aff'd, 283 F.2d 1 (C.A.8th Cir., 1960), and has provoked a conflict between circuits: with the decision of the Court of Appeals for the Ninth Circuit in the instant case, compare, e.g., Juelich v. United States, 300 F.2d 381 (C.A.5th Cir., 1962); Smith v. United States, 106 U.S.App.D.C. 169, 270 F.2d 921 (1959). We think guidelines to the proper construction of the provision are to be found in its history.
8
At common law, the denial by a court or judge of an application for habeas corpus was not res judicata. King v. Suddis, 1 East 306, 102 Eng.Rep. 119 (K.B.1801); Burdett v. Abbot, 14 East 1, 90, 104 Eng.Rep. 501, 535 (K.B.1811); Ex parte Partington, 13 M. & W. 679, 153 Eng.Rep. 284 (Ex.1845); Church, Habeas Corpus (1884), § 386; Ferris and Ferris, Extraordinary Legal Remedies (1926), § 55.3 'A person detained in custody might thus proceed from court to court until he obtained his liberty.' Cox v. Hakes, 15 A.C. 506, 527 (H.L., 1890).4 That this was a principle of our law of habeas corpus as well as the English was assumed to be the case from the earliest days of federal habeas corpus jurisdiction. Cf. Ex parte Burford, 3 Cranch 448, 2 L.Ed. 495 (Chief Justice Marshall). Since then, it has become settled in an unbroken line of decisions. Ex parte Kaine, 3 Blatchf. 1, 5—6 (Mr. Justice Nelson in Chambers); In re Kaine, 14 How. 103, 14 L.Ed. 345; Ex parte Cuddy, 40 F. 62, 65 (Cir.Ct.S.D.Cal.1889) (Mr. Justice Field); Frank v. Mangum, 237 U.S. 309, 334, 35 S.Ct. 582, 590, 59 L.Ed. 969; Salinger v. Loisel, 265 U.S. 224, 230, 44 S.Ct. 519, 521, 68 L.Ed. 989; Waley v. Johnston, 316 U.S. 101, 62 S.Ct. 964, 86 L.Ed. 1302; United States ex rel. Accardi v. Shaughnessy, 347 U.S. 260, 263, n. 4, 74 S.Ct. 499, 501, 98 L.Ed. 681; Heflin v. United States, 358 U.S. 415, 420, 79 S.Ct. 451, 454, 3 L.Ed.2d 407 (opinion of Mr. Justice Stewart) (dictum); Powell v. Sacks, 303 F.2d 808 (C.A.6th Cir., 1962). Indeed, only the other day we remarked upon 'the familiar principle that res judicata is inapplicable in habeas proceedings.' Fay v. Noia, 372 U.S. 391, 423, 83 S.Ct. 822, 840.
9
It has been suggested, see Salinger v. Loisel, supra, 265 U.S., at 230—231, 44 S.Ct., at 521—522, 68 L.Ed. 989, that this principle derives from the fact that at common law habeas corpus judgments were not appealable. But its roots would seem to go deeper. Conventional notions of finality of litigation have no place where life or liberty is at stake and infringement of constitutional rights is alleged. If 'government (is) always (to) be accountable to the judiciary for a man's imprisonment,' Fay v. Noia, supra, 375 U.S., at 402, 83 S.Ct., at page 829, access to the courts on habeas must not be thus impeded. The inapplicability of res judicata to habeas, then, is inherent in the very role and function of the writ.
10
A prisoner whose motion under § 2255 is denied will often file another, sometimes many successive motions. We are aware that in consequence the question whether to grant a hearing on a successive motion can be troublesome—particularly when the motion is prepared without the assistance of counsel and contains matter extraneous to the prisoner's case. But the problem is not new, and our decisions under habeas corpus have identified situations where denial without hearing is proper even though a second or successive application states a claim for relief. One such situation is that involved in Salinger v. Loisel, supra. There, a first application for habeas corpus had been denied, after hearing, by one District Court, and the denial was affirmed by the Court of Appeals. The prisoner then filed subsequent applications, all identical to the first, in a different District Court. We indicated that the subsequent applications might properly have been denied simply on the basis that the first denial had followed a full hearing on the merits. We there announced a governing principle; while reaffirming the inapplicability of res judicata to habeas, we said: 'each application is to be disposed of in the exercise of a sound judicial discretion guided and controlled by a consideration of whatever has a rational bearing on the propriety of the discharge sought. Among the matters which may be considered, and even given controlling weight, are * * * a prior refusal to discharge on a like application.' 265 U.S., at 231, 44 S.Ct., at 521, 68 L.Ed. 989. The Court quoted approvingly from Mr. Justice Field's opinion in Ex parte Cuddy, supra, 40 F. at 66: "The action of the court or justice on the second application will naturally be affected to some degree by the character of the court or officer to whom the first application was made, and the fullness of the consideration given to it." 265 U.S., at 231—232, 44 S.Ct., at 522, 68 L.Ed. 989. The petitioner's successive applications were properly denied because he sought to retry a claim previously fully considered and decided against him. Similarly, nothing in § 2255 requires that a sentencing court grant a hearing on a successive motion alleging a ground for relief already fully considered on a prior motion and decided against the prisoner.
11
Another such situation is that which was presented in Wong Doo v. United States, 265 U.S. 239, 44 S.Ct. 524, 68 L.Ed. 999. In Wong Doo the prisoner in his first application for habeas corpus tendered two grounds in support of his position. A hearing was held but the petitioner offered no proof of his second ground, even though the return to the writ had put it in issue. Relief was denied and the denial affirmed by the Circuit Court of Appeals. Later, he filed a second application relying exclusively on the second ground. Relief was denied. We upheld the denial: 'The petitioner had full opportunity to offer proof of (the second ground) at the hearing on the first petition, and, if he was intending to rely on that ground, good faith required that he produce the proof then. To reserve the proof for use in attempting to support a later petition, if the first failed, was to make an abusive use of the writ of habeas corpus. No reason for not presenting the proof at the outset is offered. It has not been embodied in the record, but what is said of it there and in the briefs shows that it was accessible all the time.' 265 U.S., at 241, 44 S.Ct., at 525, 68 L.Ed. 999. Similarly, the prisoner who on a prior motion under § 2255 has deliberately withheld a ground for relief need not be heard if he asserts that ground in a successive motion; his action is inequitable—an abuse of the remedy—and the court may in its discretion deny him a hearing.
12
The interaction of these two principles—a successive application on a ground heard and denied on a prior application, and abuse of the writ—was elaborated in Price v. Johnston, 334 U.S. 266, 287—293, 68 S.Ct. 1049, 1061—1064, 92 L.Ed. 1356. The petitioner had for the first time in his fourth application alleged the knowing use of perjured testimony by the prosecution. But the Court held that regardless of the number of prior applications, the governing principle announced in Salinger v. Loisel could not come into play because the fourth application relied on a ground not previously heard and determined. Wong Doo was distinguished on the ground that there the proof had been 'accessible at all times' to the petitioner, which demonstrated his bad faith, 334 U.S., at 289, 68 S.Ct., at 92 L.Ed. 1356; in Price, by contrast, for aught the record disclosed petitioner might have been justifiably ignorant of newly alleged facts or unaware of their legal significance. The case also decided an important procedural question with regard to abuse of remedy as justification for denial of a hearing, namely, that the burden is on the Government to plead abuse of the writ. '(I)f the Government chooses not to deny the allegation (of knowing use of perjured testimony) or to question its sufficiency and desires instead to claim that the prisoner has abused the writ of habeas corpus, it rests with the Government to make that claim with clarity and particularity in its return to the order to show cause.' Id., at 292, 68 S.Ct., at 1063, 92 L.Ed. 1356. The Court reasoned that it would be unfair to compel the habeas applicant, typically unlearned in the law and unable to procure legal assistance in drafting his application, to plead an elaborate negative.
13
Very shortly after the Price decision, as part of the 1948 revision of the Judicial Code, the Court's statement in Salinger of the governing principle in the treatment of a successive application was given statutory form. 28 U.S.C. § 2244.5 There are several things to be observed about this codification.
14
First, it plainly was not intended to change the law as judicially evolved. Not only does the Reviser's Note disclaim any such intention, but language in the original bill which would have injected res judicata into federal habeas corpus was deliberately eliminated from the Act as finally passed. See S.Rep.No.1559, 80th Cong., 2d Sess. 9; Moore, Commentary on the United States Judicial Code (1949), 436—438. Moreover, if construed to derogate from the traditional liberality of the writ of habeas corpus, see pp. 7—8, supra, § 2244 might raise serious constitutional questions.6 Cf. Fay v. Noia, supra, 372 U.S., at 406, 83 S.Ct., at page 831.
15
Second, even with respect to successive applications on which hearings may be denied because the ground asserted was previously heard and decided, as in Salinger, § 2244 is faithful to the Court's phrasing of the principle in Salinger, and does not enact a rigid rule. The judge is permitted, not compelled, to decline to entertain such an application, and then only if he 'is satisfied that the ends of justice will not be served' by inquiring into the merits.
16
Third, § 2244 is addressed only to the problem of successive applications based on grounds previously heard and decided. It does not cover a second or successive application containing a ground 'not theretofore presented and determined,' and so does not touch the problem of abuse of the writ. In Wong Doo, petitioner's second ground had been presented but not determined on his prior application; § 2244 would be inapplicable in such a situation. On the other hand, § 2244 was obviously not intended to foreclose judicial application of the abuse-of-writ principle as developed in Wong Doo and Price.
17
Section 2255 of the Judicial Code, under which the instant case arises, is of course also a product of the 1948 revision enacted, in the language of the Reviser's Note, to provide 'an expeditious remedy for correcting erroneous sentences (of federal prisoners) without resort to habeas corpus.' It will be noted that although § 2255 contains a parallel provision to § 2244, there is an apparent verbal discrepancy. Under § 2255, it is enough, in order to invoke the court's discretion to decline to reach the merits, that the prisoner is seeking 'similar relief' for the second time. This language might seem to empower the sentencing court to apply res judicata virtually at will, since even if a second motion is predicated on a completely different ground from the first, the prisoner ordinarily will be seeking the same 'relief.' Note, 59 Yale L.J. 1183, 1188, n. 24 (1950). But the language cannot be taken literally. In United States v. Hayman, 342 U.S. 205, 72 S.Ct. 263, 96 L.Ed. 232, the prisoner vigorously contended that § 2255 was an unconstitutional suspension of the writ of habeas corpus.7 The Court avoided the constitutional question by holding that § 2255 was as broad as habeas corpus:
18
'This review of the history of Section 2255 shows that it was passed at the instance of the Judicial Conference to meet practical difficulties that had arisen in administering the habeas corpus jurisdiction of the federal courts. Nowhere in the history of Section 2255 do we find any purpose to impinge upon prisoners' rights of collateral attack upon their convictions. On the contrary, the sole purpose was to minimize the difficulties encountered in habeas corpus hearings by affording the same rights in another and more convenient forum.' 342 U.S. at 219, 72 S.Ct., at 272, 96 L.Ed. 232. (Emphasis supplied.) Accord, United States v. Morgan, 346 U.S. 502, 511, 74 S.Ct. 247, 252—253, 98 L.Ed. 248; Smith v. United States, 88 U.S.App.D.C. 80, 187 F.2d 192 (1950); Heflin v. United States, 358 U.S. 415, 421, 79 S.Ct. 451, 454—455, 3 L.Ed.2d 407 (opinion of Mr. Justice Stewart).
19
As we said just last Term, 'it conclusively appears from the historic context in which § 2255 was enacted that the legislation was intended simply to provide in the sentencing court a remedy exactly commensurate with that which had previously been available by habeas corpus in the court of the district where the prisoner was confined.' Hill v. United States, 368 U.S. 424, 427, 82 S.Ct. 468, 471, 7 L.Ed.2d 417.
20
Plainly, were the prisoner invoking § 2255 faced with the bar of res judicata, he would not enjoy the 'same rights' as the habeas corpus applicant, or 'a remedy exactly commensurate with' habeas. Indeed, if he were subject to any substantial procedural hurdles which made his remedy under § 2255 less swift and imperative than federal habeas corpus, the gravest constitutional doubts would be engendered, as the Court in Hayman implicitly recognized. And cf. p. 11-12, supra. We therefore hold that the 'similar relief' provision of § 2255 is to be deemed the material equivalent of § 2244. See Smith v. United States, 106 U.S.App.D.C. 169, 173, 270 F.2d 921, 925 (1959); Longsdorf, The Federal Habeas Corpus Acts Original and Amended, 13 F.R.D. 407, 424 (1953). We are helped to this conclusion by two further considerations.
21
First, there is no indication in the legislative history to the 1948 revision of the Judicial Code that Congress intended to treat the problem of successive applications differently under habeas corpus than under the new motion procedure; and it is difficult to see what logical or practical basis there could be for such a distinction.
22
Second, even assuming the constitutionality of incorporating res judicata in § 2255, such a provision would probably prove to be completely ineffectual, in light of the further provision in the section that habeas corpus remains available to a federal prisoner if the remedy by motion is 'inadequate or ineffective.' A prisoner barred by res judicata would seem as a consequence to have an 'inadequate or ineffective' remedy under § 2255 and thus be entitled to proceed in federal habeas corpus—where, of course, § 2244 applies. See Smith v. United States, supra, 106 U.S.App.D.C., at 174, 270 F.2d, at 926.
II.
23
We think the judicial and statutory evolution of the principles governing successive applications for federal habeas corpus and motions under § 2255 has reached the point at which the formulation of basic rules to guide the lower federal courts is both feasible and desirable. Compare Townsend v. Sain, 372 U.S. 293, 310, 83 S.Ct. 745. Since the motion procedure is the substantial equivalent of federal habeas corpus, we see no need to differentiate the two for present purposes. It should be noted that these rules are not operative in cases where the second or successive application is shown, on the basis of the application, files, and records of the case alone, conclusively to be without merit. 28 U.S.C. §§ 2243, 2255. In such a case the application should be denied without a hearing.
24
A. SUCCESSIVE MOTIONS ON GROUNDS PREVIOUSLY HEARD AND DETERMINED.
25
Controlling weight may be given to denial of a prior application for federal habeas corpus or § 2255 relief8 only if (1) the same ground presented in the subsequent application was determined adversely to the applicant on the prior application, (2) the prior determination was on the merits, and (3) the ends of justice would not be served by reaching the merits of the subsequent application.
26
(1) By 'ground,' we mean simply a sufficient legal basis for granting the relief sought by the applicant. For example, the contention that an involuntary confession was admitted in evidence against him is a distinct ground for federal collateral relief. But a claim of involuntary confession predicated on alleged psychological coercion does not raise a different 'ground' than does one predicated on alleged physical coercion. In other words, identical grounds may often be proved by different factual allegations. So also, identical grounds may often be supported by different legal arguments, cf. Wilson v. Cook, 327 U.S. 474, 481, 66 S.Ct. 663, 667, 90 L.Ed. 793; Dewey v. Des Moines, 173 U.S. 193, 198, 19 S.Ct. 379, 380—381, 43 L.Ed. 665, or be couched in different language, United States v. Jones, 194 F.supp. 421 (D.C.D.Kan.1961) (dictum), aff'd mem., 297 F.2d 835 (C.A.10th Cir., 1962), or vary in immaterial respects, Stilwell v. United States Marshals, 192 F.2d 853 (C.A.4th Cir., 1951) (per curiam). Should doubts arise in particular cases as to whether two grounds are different or the same, they should be resolved in favor of the applicant.
27
(2) The prior denial must have rested on an adjudication of the merits of the ground presented in the subsequent application. See Hobbs v. Pepersack, 301 F.2d 875 (C.A.4th Cir., 1962). This means that if factual issues were raised in the prior application, and it was not denied on the basis that the files and records conclusively resolved these issues, an evidentiary hearing was held. See Motley v. United States, 230 F.2d 110 (C.A.5th Cir., 1956); Hallowell v. United States, 197 F.2d 926 (C.A.5th Cir., 1952).
28
(3) Even if the same ground was rejected on the merits on a prior application, it is open to the applicant to show that the ends of justice would be served by permitting the redetermination of the ground. If factual issues are involved, the applicant is entitled to a new hearing upon showing that the evidentiary hearing on the prior application was not full and fair; we canvassed the criteria of a full and fair evidentiary hearing recently in Townsend v. Sain, supra, and that discussion need not be repeated here. If purely legal questions are involved, the applicant may be entitled to a new hearing upon showing an intervening change in the law or some other justification for having failed to raise a crucial point or argument in the prior application. Two further points should be noted. first, the foregoing enumeration is not intended to be exhaustive; the test is 'the ends of justice' and it cannot be too finely particularized. Second, the burden is on the applicant to show that, although the ground of the new application was determined against him on the merits on a prior application, the ends of justice would be served by a redetermination of the ground.
29
B. THE SUCCESSIVE APPLICATION CLAIMED TO BE AN ABUSE OF REMEDY.
30
No matter how many prior applications for federal collateral relief a prisoner has made, the principle elaborated in Subpart A, supra, cannot apply if a different ground is presented by the new application. So too, it cannot apply if the same ground was earlier presented but not adjudicated on the merits. In either case, full consideration of the merits of the new application can be avoided only if there has been an abuse of the writ or motion remedy; and this the Government has the burden of pleading. See p. 11, supra.
31
To say that it is open to the respondent to show that a second or successive application is abusive is simply to recognize that 'habeas corpus has traditionally been regarded as governed by equitable principles. United States ex rel. Smith v. Baldi, 344 U.S. 561, 573, 73 S.Ct. 391, 397, 97 L.Ed. 549 (dissenting opinion). Among them is the principle that a suitor's conduct in relation to the matter at hand may disentitle him to the relief he seeks. Narrowly circumscribed, in conformity to the historical role of the writ of habeas corpus as an effective and imperative remedy for detentions contrary to fundamental law, the principle is unexceptionable.' Fay v. Noia, supra, 372 U.S., at 438, 83 S.Ct., at 848. Thus, for example, if a prisoner deliberately withholds one of two grounds for federal collateral relief at the time of filing his first application, in the hope of being granted two hearings rather than one or for some other such reason, he may be deemed to have waived his right to a hearing on a second application presenting the withheld ground. The same may be true if, as in Wong Doo, the prisoner deliberately abandons one of his grounds at the first hearing. Nothing in the traditions of habeas corpus requires the federal courts to tolerate needless piecemeal litigation, to entertain collateral proceedings whose only purpose is to vex, harass, or delay.
32
We need not pause over the test governing whether a second or successive application may be deemed an abuse by the prisoner of the writ or motion remedy. The Court's recent opinions in Fay v. Noia, supra, 372 U.S., at 438—440, 83 S.Ct., at 848, 849, and Townsend v. Sain, supra, 372 U.S., at 317, 83 S.Ct., at 760, 761, deal at length with the circumstances under which a prisoner may be foreclosed from federal collateral relief. The principles developed in those decisions govern equally here.
33
A final qualification, applicable to both A and B of the foregoing discussion, is in order. The principles governing both justifications for denial of a hearing on a successive application are addressed to the sound discretion of the federal trial judges. Theirs is the major responsibility for the just and sound administration of the federal collateral remedies, and theirs must be the judgment as to whether a second or successive application shall be denied without consideration of the merits. Even as to such an application, the federal judge clearly has the power—and, if the ends of justice demand, the duty—to reach the merits. Cf. Townsend v. Sain, supra, 372 U.S., at 312, 318, 83 S.Ct. 293. We are confident that this power will be soundly applied.
III.
34
Application of the foregoing principles to the instant case presents no difficulties. Petitioner's first motion under § 2255 was denied because it stated only bald legal conclusions with no supporting factual allegations. The court had the power to deny the motion on this ground, see Wilkins v. United States, 103 U.S.App.D.C. 322, 258 F.2d 416 (1958), although the better course might have been to direct petitioner to amend his motion, see Stephens v. United States, 246 F.2d 607 (C.A.10th Cir., 1957) (per curiam). But the denial, thus based, was not on the merits. It was merely a ruling that petitioner's pleading was deficient. To be sure, the district judge stated in a footnote to his memorandum: 'The Court has reviewed the entire file * * * which includes the previous proceeding, and a transcript of the proceedings at the time petitioner entered his plea, and * * * is of the view that petitioner's complaints are without merit in fact.' But the 'files and records of the case,' including the transcript, could not 'conclusively show' that the claim alleged in the second motion entitled the petitioner to no relief. The crucial allegation of the second motion was that petitioner's alleged mental incompetency was the result of administration of narcotic drugs during the period petitioner was held in the Sacramento County Jail pending trial in the instant case. However regular the proceedings at which he signed a waiver of indictment, declined assistance of counsel, and pleaded guilty might appear from the transcript, it still might be the case that petitioner did not make an intelligent and understanding waiver of his constitutional rights. See Machibroda v. United States, 368 U.S. 487, 82 S.Ct. 510, 7 L.Ed.2d 473; Moore v. Michigan, 355 U.S. 155, 78 S.Ct. 191, 2 L.Ed.2d 167; Commonwealth of Pennsylvania ex rel. Herman v. Claudy, 350 U.S. 116, 76 S.Ct. 223, 100 L.Ed. 126; Taylor v. United States, 193 F.2d 411 (C.A. 10th Cir., 1952). Cf. Von Moltke v. Gillies, 332 U.S. 708, 68 S.Ct. 316, 92 L.Ed. 309. For the facts on which petitioner's claim in his second application is predicated are outside the record. This is so even though the judge who passed on the two motions was the same judge who presided at the hearing at which petitioner made the waivers, and the later hearing at which he was sentenced. Whether or not petitioner was under the influence of narcotics would not necessarily have been apparent to the trial judge. Petitioner appeared before him without counsel and but briefly. That the judge may have thought that he acted with intelligence and understanding in responding to the judge's inquiries cannot 'conclusively show,' as the statute requires, that there is no merit in his present claim. Cf. Machibroda v. United States, supra, 368 U.S. at 495, 82 S.Ct., at 514, 7 L.Ed.2d 473. If anything, his request before sentence that the judge send him to a hospital 'for addiction cure' cuts the other way. Moreover, we are advised in the Government's brief that the probation officer's report made to the judge before sentence (the report is not part of the record in this Court) disclosed that petitioner received medical treatment for withdrawal symptoms while he was in jail prior to sentencing.
35
On remand, a hearing will be required. This is not to say, however, that it will automatically become necessary to produce petitioner at the hearing to enable him to testify. Not every colorable allegation entitles a federal prisoner to a trip to the sentencing court. Congress, recognizing the administrative burden involved in the transportation of prisoners to and from a hearing in the sentencing court, provided in § 2255 that the application may be entertained and determined 'without requiring the production of the prisoner at the hearing.' This does not mean that a prisoner can be prevented from testifying in support of a substantial claim where his testimony would be material. However, we think it clear that the sentencing court has discretion to ascertain whether the claim is substantial before granting a full evidentiary hearing. In this connection, the sentencing court might find it useful to appoint counsel to represent the applicant. Cf. Coppedge v. United States, 369 U.S. 438, 446, 82 S.Ct. 917, 921—922, 8 L.Ed.2d 21. Also, it will be open to the respondent to attempt to show that petitioner's failure to claim mental incompetency in his first motion was an abuse of the motion remedy, within the principles of Wong Doo and Price v. Johnston, disentitling him to a hearing on the merits. We leave to the District Court, in its sound discretion, the question whether the issue of abuse of the motion remedy, if advanced by respondent, or the issue on the merits, can under the circumstances be tried without having the prisoner present. As we said only last Term:
36
'What has been said is not to imply that a movant (under § 2255) must always be allowed to appear in a district court for a full hearing if the record does not conclusively and expressly belie his claim, no matter how vague, conclusory, or palpably incredible his allegations may be. The language of the statute does not strip the district courts of all discretion to exercise their common sense. Indeed, the statute itself recognizes that there are times when allegations of facts outside the record can be fully investigated without requiring the personal presence of the prisoner. Whether the petition in the present case can appropriately be disposed of without the presence of the petitioner at the hearing is a question to be resolved in the further proceedings in the District Court.
37
'There will always be marginal cases, and this case is not far from the line. But the specific and detailed factual assertions of the petitioner, while improbable, cannot at this juncture be said to be incredible. If the allegations are true, the petitioner is clearly entitled to relief. * * *' Machibroda v. United States, supra, 368 U.S., at 495—496, 82 S.Ct., at 514, 7 L.Ed.2d 473. (Footnote omitted.)
38
The need for great care in criminal collateral procedure is well evidenced by the instant case. Petitioner was adjudged guilty of a crime carrying a heavy penalty in a summary proceeding at which he was not represented by counsel. Very possibly, the proceeding was constitutionally adequate. But by its summary nature, and because defendant was unrepresented by counsel, a presumption of adequacy is obviously less compelling than it would be had there been a full criminal trial. Moreover, the nature of the proceeding was such as to preclude direct appellate review. In such a case it is imperative that a fair opportunity for collateral relief be afforded. An applicant for such relief ought not to be held to the niceties of lawyers' pleadings or be cursorily dismissed because his claim seems unlikely to prove meritorious. That his application is vexatious or repetitious, or that his claim lacks any substance, must be fairly demonstrated.
39
Finally, we remark that the imaginative handling of a prisoner's first motion would in general do much to anticipate and avoid the problem of a hearing on a second or successive motion. The judge is not required to limit his decision on the first motion to the grounds narrowly alleged, or to deny the motion out of hand because the allegations are vague, conclusional, or inartistically expressed. He is free to adopt any appropriate means for inquiry into the legality of the prisoner's detention in order to ascertain all possible grounds upon which the prisoner might claim to be entitled to relief. Certainly such an inquiry should be made if the judge grants a hearing on the first motion and allows the prisoner to be present. The disposition of all grounds for relief ascertained in this way may then be spread on the files and records of the case. Of course, to the extent the files and records 'conclusively show' that the prisoner is entitled to no relief on any such grounds, no hearing on a second or successive motion, to the extent of such grounds, would be necessary.
40
The judgment of the Court of Appeals is reversed and the case is remanded to the District Court for a hearing consistent with this opinion.
41
It is so ordered.
42
Mr. Justice WHITE concurs in the result.
43
Mr. Justice HARLAN, whom Mr. Justice CLARK joins, dissenting.
44
This case, together with Townsend v. Sain, 372 U.S. 293, 83 S.Ct. 745, and Fay v. Noia, 372 U.S. 391, 83 S.Ct. 822, form a trilogy of 'guideline' decisions in which the Court has undertaken to restate the responsibilities of the federal courts in federal post-conviction proceedings. Sain and Noia relate to federal habeas corpus proceedings arising out of state criminal convictions. The present case involves successive § 2255 applications (and similar habeas corpus proceedings under § 2244, which the Court finds sets the pattern for § 2255) arising out of federal convictions.
45
The over-all effect of this trilogy of pronouncements is to relegate to a back seat, as it affects state and federal criminal cases finding their way into federal post-conviction proceedings, the principle that there must be some end to litigation.
46
While, contrary to the Court, I think the District Court's denial without hearing of a second § 2255 application in this case was entirely proper in the circumstances shown by the record, the more serious aspect of the Court's opinion is the impact it is likely to have in curbing the ability of the Federal District Courts to cope efficiently, as well as fairly, with successive applications by federal prisoners,1 the number of which will doubtless increase as a result of what is said today. The net of it is that the Court has come forth with a new § 2255 of its own which bears little resemblance to the statute enacted by Congress. And in the process the Court has even gone so far as to suggest that any tampering with its new composition may run afoul of the Constitution.
I.
47
At the outset, there is one straw man that should be removed from this case. The Court is at great pains to develop the theme that denial of a prisoner's application for collateral relief is not res judicata. But the Government recognizes, as indeed it must in view of the decisions, that strict doctrines of res judicata do not apply in this field. The consequences of injustice—loss of liberty and sometimes loss of life—are far too great to permit the automatic application of an entire body of technical rules whose primary relevance lies in the area of civil litigation.
48
This is not to suggest, however, that finality, as distinguished from the particular rules of res judicata, is without significance in the criminal law. Both the individual criminal defendant and society have an interest in insuring that there will at some point be the certainty that comes with an end to litigation, and that attention will ultimately be focused not on whether a conviction was free from error but rather on whether the prisoner can be restored to a useful place in the community. It is with this interest in mind, as well as the desire to avoid confinements contrary to fundamental justice, that courts and legislatures have developed rules governing the availability of collateral relief.
49
Thus it has long been recognized that not every error that may have occurred at a criminal trial may be raised in collateral proceedings. For many years after the Constitution was adopted, and even down to the present century, such proceedings were generally confined to matters of personal and subject matter jurisdiction. Cf. Fay v. Noia, 372 U.S. 391, 450—455, 83 S.Ct. 822, 853 (dissenting opinion of this writer). And while the scope of collateral review has expanded to cover questions of the kind raised by petitioner here, the Court has consistently held that neither habeas corpus nor its present federal counterpart § 2255 is a substitute for an appeal. See, e.g., Sunal v. Large, 332 U.S. 174, 67 S.Ct. 1588, 91 L.Ed. 1982; Hill v. United States, 368 U.S. 424, 82 S.Ct. 468, 7 L.Ed.2d 417; see also, e.g., Franano v. United States, 8 Cir., 303 F.2d 470.
50
Similarly, the Court has held that not all questions that were or could have been raised in an initial application for collateral relief must necessarily be entertained if raised in a successive application. A District Court, for example, has discretion to deny a successive application if the claim asserted was heard and determined on a prior application, Salinger v. Loisel, 265 U.S. 224, 44 S.Ct. 519, 68 L.Ed. 989. Indeed the Court has stated that it would be an abuse of discretion to entertain a second application if the claim raised had been raised before, a hearing had been held, and no proof in support of the claim had been offered at the hearing. Wong Doo v. United States, 265 U.S. 239, 44 S.Ct. 524, 68 L.Ed. 999. And in the same year that § 2255 was adopted, the decision in Price v. Johnston, 334 U.S. 266, 68 S.Ct. 1049, 92 L.Ed. 1356, made it clear that a successive application could be denied for abuse of the remedy even if the prisoner's claim had not been raised in any prior application, unless there were some acceptable excuse for the failure to do so.
51
It is in light of this history that § 2255, and the related § 2244, dealing with successive applications for writs of habeas corpus, must be considered. Concern with existing and potential abuse of the remedy by prisoners who made a pastime of filing collateral proceedings led to proposals that successive applications for habeas corpus on grounds previously available would be wholly barred, except in the form of petitions for rehearing to the same judge, and that applications under what became § 2255 would have to be submitted within one year after discovery of the facts or a change in the law. E.g., H.R. 4232, 79th Cong., 1st Sess.; H.R. 6723, 79th Cong., 2d Sess. These proposals were rejected in favor of the traditional discretion exercised by courts with respect to successive applications, and it was made clear that this discretion extended to a case in which an applicant asserted for the first time a ground that could have been raised before. Thus the final wording of § 2244 provided that the court shall not be required to entertain a petition
52
'* * * if it appears that the legality of such detention has been determined * * * on a prior application * * * and the petition presents no new ground not theretofore presented and determined * * *.' (Emphasis added.)
53
The word 'new,' a word ignored by the Court in its discussion of this provision, is of cardinal importance. A memorandum by Circuit Judge Stone, adopted in a Senate Report (S.Rep.No. 1527, 80th Cong., 2d Sess.), noted that two of the purposes of an earlier version cf. this provision were 'to compel petitioner to state in his petition all of the grounds for the writ then known to him' and 'to afford unlimited opportunity to present any grounds which petitioner may thereafter discover at any time.' (Emphasis added.) This latter purpose was 'brought about by allowing presentation of a subsequent petition based upon 'new' grounds 'not theretofore presented and determined."2 Thus a 'new ground,' within the meaning of § 2244, is one that has not previously been asserted and had not previously been known. The Court is manifestly in error in its conclusion, ante, pp. 11—13, that the discretion provided for in § 2244 is limited to petitions relying on grounds previously heard and decided.
54
Although the wording of § 2255 is more general, it is clearly directed to the same end:
55
'The sentencing court shall not be required to entertain a second or successive motion for similar relief on behalf of the same prisoner.'
56
The 'relief' sought is the setting aside of the sentence; the statute contains no reference to the nature of the grounds urged in support of the motion, and there can be little doubt that the discretion vested in the court was intended to extend to cases in which a particular ground was urged for the first time.
57
Further, it would appear from the language of § 2255—the 'sentencing court' is not 'required to entertain' successive motions—that the court was given discretion to deny a second motion, on grounds of abuse, on its own initiative and without waiting for the Government to raise the point in its return. The provision, to this extent, departed from the rule of pleading declared in the year of its adoption in Price v. Johnston, supra, 334 U.S., at 292, 68 S.Ct., at 1063, 92 L.Ed. 1356—that in habeas corpus applications, 'it rests with the Government to make that claim (of abuse) with clarity and particularity in its return to the order to show cause.' Such a departure was amply justified by the fact that on a § 2255 motion, unlike a habeas corpus application, the prisoner's claim is presented to the sentencing court (usually the trial judge himself), which has ready access to the record of the original conviction and of the prior motions. Moreover, Congress could certainly have reasonably concluded, as did the dissenters in Price, that:
58
'It is not too much to ask the petitioner to state, however informally, that this * * * petition is based on newly discovered matter, or, in any event, on a claim that he could not fairly have been asked to bring to the court's attention in his * * * prior petitions. Such a requirement certainly does not narrow the broad protection which the writ * * * serves.' 334 U.S., at 294,3 68 S.Ct., at 1064, 92 L.Ed. 1356.
59
The Court in Price held only that the burden is on the Government to plead abuse of the writ; the burden of proving an adequate excuse was explicitly placed on the prisoner:
60
'Once a particular abuse has been alleged, the prisoner has the burden of answering that allegation and of proving that he has not abused the writ.' 334 U.S., at 292, 68 S.Ct., at 1063, 92 L.Ed. 1356.
61
The Court today, however, leaves the crucial question of burden of proof up in the air. If it means to suggest that this burden also rests with the Government, then it is going far beyond the holding of the sharply divided Court in Price. The relevant facts on the question of abuse would almost always lie within the exclusive possession of the prisoner, and any evidentiary burden placed on the Government would therefore be one that it could seldom meet.
62
It is startling enough that the Government may now be required to establish, in a collateral attack on a prior conviction, that a successive application is an abuse of the remedy. It is at least equally startling to learn that the question whether or not there has been abuse of the remedy may turn on whether the prisoner had 'deliberately' withheld the ground now urged or had 'deliberately' abandoned it at some earlier stage. Ante, p. 18. The established concept of inexcusable neglect is apparently in the process of being entirely eliminated from the criminal law, cf. Fay v. Noia, 372 U.S. 391, 83 S.Ct. 822, and the standard that seems to be taking its place will, I am afraid, prove wholly inadequate and in the long run wholly unsatisfactory.
63
I must also protest the implication in the Court's opinion that every decision of this Court in the field of habeas corpus even one like Price v. Johnston, dealing with a purely procedural question on which reasonable men surely may differ—has become enshrined in the Constitution because of the guarantee in Article I against suspension of the writ. This matter may perhaps be brought back into proper perspective by noting again that at the time of the adoption of the Constitution, and for many years after-ward, a claim of the kind asserted by Price, or asserted here by petitioner, was not cognizable in habeas corpus at all. See p. 25, supra.
II.
64
Section 2255, read against the back-ground of this Court's decisions and the history of the related provision § 2244, is surely designed to vest in the District Court a sound discretion to deny a successive motion, on its own initiative, for abuse of the remedy. At the very least, this exercise of discretion should be upheld in a case in which there has been no adequate explanation of the earlier failure to make the claim and in which the whole record, including that of the prior motion, casts substantial doubts on the merit of that claim. This is such a case.
65
In the affidavit filed in support of his second motion, the petitioner asserted that he 'did not understand trial proceeding owing to his mental incompetency cause(d) by the administration of a drug.' The judge who denied this motion was the same judge who presided at the trial, and the record not only shows that the judge took pains to make certain Sanders was aware of all of his rights but also indicates that Sanders did indeed understand the nature of the proceedings. After the judge explained at some length Sanders' right to force the Government to proceed by indictment, the following questions were asked:
66
'Having in mind all that I have told you do you wish to have the matter heard by the grand jury?
67
'The Defendant. No, your honor, I waive it.
68
'The Court. I didn't hear that.
69
'The Defendant. I waive that right.
70
'The Court. You waive that right?
71
'The Defendant. Yes.
72
'The Court. You understand you do have the right, though?
73
'The Defendant. Yes.
74
'The Court. And you now want to proceed without indictment and by way of information?
75
'The Defendant. Yes.'
76
In response to further questions, Sanders said he was acting freely and voluntarily. He then signed a waiver of indictment and after the information was read to him, pleaded guilty.
77
Sentencing followed some three weeks after, and about one year later Sanders filed a § 2255 motion alleging, inter alia, that the court had allowed him to be 'intimidated and coerced into intering (sic) a plea without Counsel, and any knowledge of the charges.' This motion was denied on the merits, not simply for insufficiency, the trial judge correctly stating that the charges were 'completely refuted by the files and records of this case.'
78
The motion before us now was filed some nine months after the initial application. In addition to commenting that he was 'not required to entertain a second motion for similar relief,' the trial judge said that he had 'reviewed the entire file' and was 'of the view that petitioner's complaints are without merit in fact.' In support of this conclusion, in addition to whatever inferences the judge may properly have drawn from his own observation of Sanders at the trial, there is:
79
(1) the record of the original trial, which strongly indicates that, contrary to his sworn allegation, petitioner did understand precisely what was going on and responded promptly and intelligently;
80
(2) an initial application under § 2255 which not only failed to mention the claim now urged—a lack of mental competence to understand—but indeed advanced a wholly inconsistent claim that the court allowed him to be 'intimidated and coerced' into pleading guilty; and (3) a second application, not filed for another nine months, without any explanation why a point which was obviously known to petitioner before, and which would so clearly have been relevant, had not previously been raised.
81
In the light of the whole record, including the prior application, the second motion rested on an assertion of fact that was highly suspect, if not self-refuting. If the assertion had been made in the initial application, or if a valid excuse had been offered for the failure to do so, a hearing would doubtless have been necessary. But to require a hearing under the present circumstances, and to tell the trial court that it has abused its discretion, is to sanction manifest abuse of the remedy.
III.
82
I seriously doubt the wisdom of these 'guideline' decisions. They suffer the danger of pitfalls that usually go with judging in a vacuum. However carefully written, they are apt in their application to carry unintended consequences which once accomplished are not always easy to repair. Rules respecting matters daily arising in the federal courts are ultimately likely to find more solid formulation if left to focused adjudication on a case-by-case basis, or to the normal rule-making processes of the Judicial Conference, rather than to ex cathedra pronouncements by this Court, which is remote from the arena.
83
In dealing with cases of this type, I think we do better to confine ourselves to the particular issues presented, and on that basis I would affirm the judgment of the Court of Appeals.
1
Section 2255 provides:
'A prisoner in custody under sentence of a court established by Act of Congress claiming the right to be released upon the ground
that the sentence was imposed in violation of the Constitution or laws of the United States, or that the court was without jurisdiction to impose such sentence, or that the sentence was in excess of the maximum authorized by law, or is otherwise subject to collateral attack, may move the court which imposed the sentence to vacate, set aside or correct the sentence.
'A motion for such relief may be made at any time.
'Unless the motion and the files and records of the case conclusively show that the prisoner is entitled to no relief, the court shall cause notice thereof to be served upon the United States attorney, grant a prompt hearing thereon, determine the issues and make findings of fact and conclusions of law with respect thereto. If the court finds that the judgment was rendered without jurisdiction, or that the sentence imposed was not authorized by law or otherwise open to collateral attack, or that there has been such a denial or infringement of the constitutional rights of the prisoner as to render the judgment vulnerable to collateral attack, the court shall vacate and set the judgment aside and shall discharge the prisoner or resentence him or grant a new trial or correct the sentence as may appear appropriate.
'A court may entertain and determine such motion without requiring the production of the prisoner at the hearing.
'The sentencing court shall not be required to entertain a second or successive motion for similar relief on behalf of the same prisoner.
'An appeal may be taken to the court of appeals from the order entered on the motion as from a final judgment on application for a writ of habeas corpus.
'An application for a writ of habeas corpus in behalf of a prisoner who is authorized to apply for relief by motion pursuant to this section, shall not be entertained if it appears that the applicant has failed to apply for relief, by motion, to the court which setenced him, or that such court has denied him relief, unless it also appears that the remedy by motion is inadequate or ineffective to test the legality of his detention.'
2
Petitioner makes no claim that the procedure employed by the District Court was not adequate to advise him of his constitutional rights to assistance of counsel, grand jury indictment, and trial by jury.
3
'This case has already been before the Court of Queen's Bench, on the return of a habeas corpus, and before my Lord Chief Baron at chambers, on a subsequent application for a similar writ. In both instances the discharge was refused. The defendant, however, has a right to the opinion of every court as to the propriety of his imprisonment, and therefore we have thought it proper to examine attentively the provisions of the statute, without considering ourselves as concluded by these decisions.' Ex parte Partington, supra, 13 M. & W., at 683—684, 153 Eng. Rep., at 286.
4
See also Church, supra, § 389. The traditional English practice has recently been curtailed by statute. Administration of Justice Act, 1960, 8 & 9 Eliz. II, c. 65, § 14(2).
5
Section 2244 provides:
'No circuit or district judge shall be required to entertain an application for a writ of habeas corpus to inquire into the detention of a person pursuant to a judgment of a court of the United States, or of any State, if it appears that the legality of such detention has been determined by a judge or court of the United States on a prior application for a writ of habeas corpus and the petition presents no new ground not theretofore presented and determined, and the judge or court is satisfied that the ends of justice will not be served by such inquiry.'
6
Article I, § 9, cl. 2, of the Federal Constitution provides: 'The Privilege of the Writ of Habeas Corpus shall not be suspended, unless when in Cases of Rebellion or Invasion the public Safety may require it.'
7
The Court of Appeals in Hayman had held § 2255 unconstitutional. 187 F.2d 456 (C.A.9th Cir., 1950), amended, id., at 471 (1951). The same position had been taken in a Note in the Yale Law Journal, 'Section 2255 of the Judicial Code: The Threatened Demise of Habeas Corpus,' 59 Yale L.J. 1183 (1950). In this Court, a powerful constitutional attack was mounted by respondent's assigned counsel, Mr. Paul A. Freund.
8
The discussion in this opinion relates, of course, solely to the problem of successive applications for federal collateral relief. For the principles which govern where the prior application is not for federal collateral relief, see Fay v. Noia, supra, and Townsend v. Sain, supra.
1
According to the reports of the Administrative Office of the United States Courts, 538 § 2255 proceedings were commenced in 1960, 560 in 1961, and 546 in 1962. Annual Report of the Director, 1960, p. 231; id., 1961, p. 239; Preliminary Annual Report of the Director, 1962, Division of Procedural Studies and Statistics, p. 23. The Government, in referring to these figures in its brief, has stated that even they 'do not * * * appear to be complete in light of the Department's experience with petitions for writs of certiorari in this Court.'
2
The memorandum of Circuit Judge Stone was written at a time when the proposal was to bar successive applications except in the form of petitions for rehearing to the same judge that had passed on the prior application. But the language in issue here, defining those applications considered to be successive, i.e., those presenting 'no new ground not theretofore presented and determined,' was the same as that contained in § 2244 as ultimately enacted.
3
It seems clear that the actual decision in Price v. Johnston could not have entered into Congress' deliberations on §§ 2244 and 2255, since the decision was handed down only one month before formal enactment, and well after study and formulation of the proposals.
| 01
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373 U.S. 49
83 S.Ct. 1054
10 L.Ed.2d 184
Andre MAXIMOV, Trustee, Petitioner,v.UNITED STATES.
No. 240.
Argued March 28, 1963.
Decided April 29, 1963.
David A. Lindsay, New York City, for petitioner.
Louis F. Claiborne, New Orleans, La., for respondent.
Mr. Justice GOLDBERG delivered the opinion of the Court.
1
The question in this case is whether an American trust whose beneficiaries are British subjects and residents and which retains capital gains income realized in this country is exempt from federal income tax on such gains by virtue of a provision of the Income Tax Convention between the United States of America and the United Kingdom, April 16, 1945, 60 Stat. 1377, 1384, which exempts capital gains of a 'resident of the United Kingdom.' Certiorari was granted, 371 U.S. 810, 83 S.Ct. 41, 9 L.Ed.2d 53, to resolve a conflict between the decision of the Court of Appeals for the Second Circuit, 299 F.2d 565, denying the exemption to the domestic trust, the petitioner in this case, and the decision of the Court of Appeals for the Ninth Circuit in American Trust Co. v. Smyth, 247 F.2d 149, granting the exemption to a domestic trust under similar circumstances.
I.
2
The petitioner, represented here by its successor trustee, Maximov, a citizen and resident of the United States, is a private trust created under Connecticut law in 1947 by an inter vivos deed executed by the grantor, a resident and citizen of the United Kingdom. A lifetime interest in trust income was retained by the grantor, his wife was named contingent successor income beneficiary for her life, and their children were designated as contingent remaindermen. All of the beneficiaries were citizens and residents of the United Kingdom at the times here relevant.
3
The trust, which is administered in the United States, realized capital gains income upon the sale of certain of its assets during 1954 and 1955. In accordance with controlling Connecticut law, which the trust instrument expressly makes applicable, these gains were treated as accretions to corpus and were not distributed. Pursuant to United States income tax provisions applicable to trusts in general, the gains were reported as part of the trust's income on federal fiduciary tax returns filed by the trustee for the years in question and the appropriate amount of tax paid thereon.
4
Asserting exemption from United States tax under the Convention, the trustee filed claims for refund which were disallowed by the Internal Revenue Service. The trustee then brought this suit in the Federal District Court seeking recovery of the tax attributable to the capital gains. Motions for summary judgment were filed both by the petitioner and by the government. The District Court denied the Government's motion and entered judgment for the petitioner in the full amount of the tax, holding, upon the authority of the Smyth case, supra, that the petitioner was entitled to exemption under the treaty. The Court of Appeals for the Second Circuit reversed and denied the petitioner's claim of exemption under the Convention. In so doing, the Second Circuit expressly rejected the reasoning adopted, and result reached, by the Ninth Circuit in Smyth.
5
We conclude that the interpretation of the relevant provisions of the Convention adopted by the Second Circuit in this case is the one more consonant with its language, purpose and intent. Accordingly, we affirm the judgment of the Court of Appeals below, denying the exemption.
II.
6
Under United States tax laws, a trust, like the petitioner trust, is treated as a separate taxable entity, apart from its beneficiaries. §§ 641, 7701(a)(1), (14), Int.Rev.Code of 1954. And, under appropriate provisions of the Internal Revenue Code, trust income neither distributed nor otherwise taxable directly to the beneficiaries is taxable to the trust entity. See §§ 641—668, Int.Rev.Code of 1954. Under these statutory concepts of taxability, the gains here in question are properly includable in, and taxable as, gross income of the petitioner. Whatever basis there may be, therefore, for relieving the trust from tax must be found in the words or implications of the Convention.
7
In asserting freedom from liability for United States income tax on its realized and retained capital gains, the petitioner trust relies on Article XIV of the Convention, which provides:
8
'A resident of the United Kingdom not engaged in trade or business in the United States shall be exempt from United States tax on gains from the sale or exchange of capital assets.'
9
The petitioner itself is a United States trust established in this country, governed by the laws of one of our States and administered here by an American trustee. It is plainly not a 'resident of the United Kingdom,' the class to which exemption under Article XIV is expressly limited. It argues, however, that the purposes and objectives of the treaty require that we disregard its identity as a separate taxable entity and measure the application of the exemptive provision by the economic impact of the tax which would otherwise be imposed. The petitioner thus says that since the real burden of the tax falls upon its beneficiaries, all of whom are residents of the United Kingdom and objects of the treaty protections, the treaty should be read as exempting the trust from the tax asserted by the United States. Mindful that it is a treaty we are construing, and giving the Convention all proper effect, we cannot, and do not, either read its language or conceive its purpose as encompassing, much less compelling, so significant a deviation from normal word use or domestic tax concepts.
10
The plain language of the Convention does not afford any support to the petitioner's argument in favor of disregarding the trust entity. In fact, the very words of the treaty impel a contrary reading. The exemption provided by Article XIV applies in terms only to a 'resident of the United Kingdom' and Article II(1)(g) defines such a resident as 'any person (other than a citizen of the United States or a United States corporation) who is resident in the United Kingdom for the purposes of United Kingdom tax and not resident in the United States for the purposes of United States tax.' The word 'person' is not defined in the treaty and we are referred by Article II(3) of the Convention, therefore, to the domestic tax law of the country applying the treaty, in this case the United States, to determine its meaning.1 Under United States tax law, and apparently under British law as well, the term 'person' includes a trust. Int.Rev.Code of 1954, § 7701(a)(1); see Harvard Law School, World Tax Series, Taxation in the United Kingdom, 5/3.4, p. 127 (1957). Thus, it appears quite clearly that, within the meaning of the Convention, the petitioner trust is a separate 'person' and distinct tax entity, apart from its beneficiaries. Since the petitioner meets neither of the definitional tests of the treaty it is not resident in the United Kingdom for purposes of that signatory's tax and is a resident in the United States for purposes of this country's tax—it plainly is not a 'resident of the United Kingdom' exempted from United States tax by the Convention.
11
Apparently recognizing the impediments of the language of the exemptive provision interpreted in accordance with its terms and pursuant to the standards set out in the treaty itself, the petitioner asserts that equality of tax treatment was the objective of the treaty and that furtherance of this objective compels adoption of its theory that exemption must be accorded whenever the burden of the tax would diminish such equality. Since, in general terms at least, the United Kingdom imposes no tax on capital gains, says the petitioner, no similar tax should be imposed by the United States here.
12
The immediate and compelling answer to this contention is that, as already noted, the language of the Convention itself not only fails to support the petitioner's view, but is contrary to it. Moreover, it is particularly inappropriate for a court to sanction a deviation from the clear import of a solemn treaty between this Nation and a foreign sovereign, when, as here, there is no indication that application of the words of the treaty according to their obvious meaning effects a result inconsistent with the intent or expectations of its signatories. It appears from the relevant materials instructive as to the intent of the parties to the Convention that the general purpose of the treaty was not to assure complete and strict equality of tax treatment—a virtually impossible task in light of the different tax structures of the two nations—but rather, as appears from the preamble to the Convention itself, to facilitate commercial exchange through elimination of double taxation resulting from both countries levying on the same transaction or profit; an additional purpose was the prevention of fiscal evasion.2 Certainly, neither of these purposes requires the granting of relief in the situation here presented. There is concededly no imposition of a double tax on the gains of the petitioner, since neither it nor its beneficiaries are taxed thereon under United Kingdom law. See Harvard Law School, World Tax Series, Taxation in the United Kingdom, 9/8.1, 10/7.2, pp. 277, 307—308. Moreover, no impairment of, or obstacle to, trade or commercial intercourse is threatened in the context of this case, and considerations of fiscal evasion are not here involved.
13
Even to the extent that one purpose of the Convention was to secure a measure of equality of tax treatment, it is apparent from the face of the treaty itself that no invariable or inflexible equality was sought or intended. In fact, the treaty creates some inequalities of treatment. For example, the very exemption provided by Article XIV, on which the petitioner relies, is limited in its application to United Kingdom residents who are not 'engaged in trade or business in the United States.' Thus, not even all United Kingdom residents are immune from capital gains taxation in this country, though United States residents doing business or conducting a trade in the United Kingdom would receive the full benefit of the absence of a general capital gains tax there. It appears that the treaty did not represent an attempt to equalize all disparities in tax treatment between its signatories. To the extent that complete equality was intended, it was specifically provided. We cannot, in such a context, read the treaty to accord unintended benefits inconsistent with its words and not compellingly indicated by its implications.3 To say that we should give a broad and efficacious scope to a treaty does not mean that we must sweep within the Convention what are legally and traditionally recognized to be domestic taxpayers not clearly within its protections; we would not expect the United Kingdom to exempt similarly recognized British taxpayers not lucidly intended to be freed of its taxes.
14
This, of course, does not mean that the treaty fails to provide bilateral benefits to residents of both the United States and the United Kingdom. A resident of the United Kingdom realizing capital gains in this country is appropriately protected and exempt, and the Congress has adopted provisions fully implementing the operative dimensions of the treaty. The Internal Revenue Code contains sections designed to give effect to exemptions of this type and to assure consistency with tax treaty obligations in general. See, e.g., Int.Rev.Code of 1954, §§ 894, 7852(d). Our interpretation affords every benefit negotiated for by the parties to the Convention on behalf of their respective residents and prevents an unintended tax windfall to a private party. The language and purposes of the treaty are amply served by adhering to its clear import limiting exemption to 'residents of the United Kingdom' falling within the exemptive purview. The petitioner, a resident American trust, is properly subject to United States income tax on its retained capital gains. Accordingly, the judgment below is affirmed.
15
Affirmed.
1
Article II(3) of the Convention provides:
'In the application of the provisions of the present Convention by one of the Contracting Parties any term not otherwise defined shall, unless the context otherwise requires, have the meaning which it has under the laws of that Contracting Party relating to the taxes which are the subject of the present Convention.'
2
The preamble recites that the parties desired 'to conclude a Convention for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income.' See also Hearings before a Subcommittee of the Committee on Foreign Relations, on Conventions With Great Britain and Northern Ireland Respecting Income and Estate Taxes, S. Exec. Docs. D and E, 79th Cong., 1st Sess. 1—2.
3
Treatment of the petitioner trust as a taxable entity for purposes of construing the treaty exemption and imposition of liability for tax on its undistributed capital gains is not only mandated by the terms of the treaty itself, the apparent intention of its signatories, and the context in which negotiated, but is consistent with long-standing administrative practice and regulations, see T.D. 5569, 1947—2 Cum.Bull. 100, § 7.519(c), and with the administrative interpretation accorded many other United States tax conventions limiting such exemptions to items of income distributed or otherwise normally directly taxable to the trust beneficiaries. See, e.g., Australia, T.D. 6108, 1954—2 Cum.Bull. 614, § 501.10; Belgium, T.D. 6160, 1956—1 Cum.Bull. 815, § 504.119; Switzerland, T.D. 6149, 1955—2 Cum.Bull. 814, § 509.121.
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373 U.S. 96
83 S.Ct. 1175
10 L.Ed.2d 224
Nathan WILLNER, Petitioner,v.COMMITTEE ON CHARACTER AND FITNESS, etc.
No. 140.
Argued Feb. 21, 1963.
Decided May 13, 1963.
Henry Waldman, New York City, for petitioner.
Daniel M. Cohen, New York City, for respondent.
Opinion of the Court by Mr. Justice DOUGLAS, announced by Mr. Justice BLACK.
1
Petitioner passed the New York bar examinations in 1936 but has not yet been admitted to practice. The present case is the latest in a long series of proceedings whereby he seeks admission.
2
Under New York law the Appellate Division of the State Supreme Court of each of the four Judicial Departments has power to admit applicants to the Bar. Once the State Board of Bar Examiners certifies that an applicant has passed the examination (or that an examination has been dispensed with), the Appellate Division shall admit him to practice 'if it shall be satisfied that such person possesses the character and general fitness requisite for an attorney and counsellor-at-law.' Judiciary Law, § 90(1)(a), McKinney's Consol.Laws, c. 30.
3
The Appellate Division is required by Rule 1 of the New York Rules of Civil Practice to appoint a committee of not less than three practicing lawyers 'for the purpose of investigating the character and fitness' of applicants. 'Unless otherwise ordered by the appellate division, no person shall be admitted to practice' without a favorable certificate from the Committee. Ibid. Provision is made for submission by the applicant to the Committee of 'all the information and data required by the committee and the Appellate Division justices.' Ibid. If an applicant has once applied for admission and failed to obtain a certificate of good character and fitness, he must obtain and submit 'the written consent' of the Appellate Division to a renewal of his application. Ibid.
4
The papers of an applicant for admission to the Bar are required by Rule 1(g) of the Rules of Civil Practice to be kept on file in the Office of the Clerk of the Appellate Division.
5
The Court of Appeals pursuant to its rule-making authority (Judiciary Law, § 53(1)) has promulgated Rules for the Admission of Attorneys and Counsellors-at-Law, Judiciary Law Appendix which provide, inter alia, that every applicant must produce before the Committee 'evidence that he possesses the good moral character and general fitness requisite for an attorney and counsellor-at-law' (Rule VIII—1), and that justices of the Appellate Division shall adopt 'such additional rules for ascertaining the moral and general fitness of applicants as to such justices may seem proper.' Rule VIII—4.
6
The Appellate Division to which petitioner has made application has not promulgated any 'additional rules' under Rule VIII—4. Its Character and Fitness Committee consists of 10 members; and that Committee, we are advised, has not published or provided any rules of procedure.
7
The statute provides that 'all papers, records and documents' of applicants 'shall be sealed and be deemed private and confidential,' except that 'upon good cause being shown, the justices of the appellate division * * * are empowered, in their discretion, by written order, to permit to be divulged all or any part of such papers, records and documents.' Judiciary Law, § 90(10). And for that purpose they may make such rules 'as they may deem necessary.' Ibid.
8
But New York does not appear to have any procedure whereby an applicant for admission to the Bar is served with an order to show cause by the Appellate Division before he is denied admission nor any other procedure that gives him a hearing prior to the court's adverse action.1
9
The present case started with a petition by Willner to the Appellate Division seeking leave to file a de novo application which alleged the following:
10
Willner had been certified by the State Board of Bar Examiners as having passed the bar examinations in 1936, and the Committee in 1938, after several hearings, filed with the Appellate Division its determination that it was not satisfied and could not 'certify that the applicant possesses the character and general fitness requisite for an attorney and counsellor-at-law.' In 1943 Willner applied to the Appellate Division for an order directing the Committee to review its 1938 determination. This motion was denied without opinion. Willner in 1948 again petitioned the Appellate Division for a reexamination of his application, and for permission to file a new application. The Appellate Division permitted him to file a new application. Upon the filing of that application, the Committee conducted two hearings in 1948 and, by a report in 1950, refused to certify him for the second time. In 1951 Willner again made application to the Appellate Division for an order directing, inter alia, the Committee to furnish him with statements of its reasons for its refusal to certify him or that a referee be appointed to hear and report on the question of his character and fitness. This application was denied without opinion. In 1954 Willner filed a fourth application with the Appellate Division requesting leave to file an application for admission. This was denied without opinion. The Court of Appeals refused leave to appeal, and this Court denied certiorari. 348 U.S. 955, 75 S.Ct. 445, 99 L.Ed. 746. In 1960 Willner filed a fifth application with the Appellate Division, which application was denied without opinion.
11
The present petition further alleged that Willner has been a member in good standing of the New York Society of Certified Public Accountants and of the American Institute of Accountants since 1951 and that he has been admitted to practice before the Tax Court and the Treasury Department since 1928. Petitioner alleged that in connection with his hearings before the Committee on his 1937 application he was shown a letter containing various adverse statements about him from a New York attorney; that a member of the Committee promised him a personal confrontation with that attorney; but that the promise was never kept. Petitioner also alleged that he had been involved in litigation with another lawyer who had as his purpose 'to destroy me'; that the secretary of the Committee was taking orders from that lawyer and that two members of the Committee were 'in cahoots' with that lawyer.
12
The Appellate Division denied the petition without opinion and denied leave to appeal to the Court of Appeals. Willner thereupon sought leave to appeal to the Court of Appeals and in an affidavit in support of his motion stated, 'I was never afforded the opportunity of confronting my accusers, of having the accusers sworn and cross-examining them, and the opportunity of refuting the accusations and accusers.' The Court of Appeals granted leave to appeal and the Clerk of that Court obtained from the Clerk of the Appellate Division the file in the case. Willner, in his brief before the Court of Appeals, argued he had been denied his constitutional rights in that he had been denied confrontation of his accusers and that, in spite of the repeated attempts, he could not be sure of the Committee's reasons for refusing to certify him for admission. The Court of Appeals, after oral argument, affirmed the order without opinion. 11 N.Y.2d 866, 227 N.Y.S.2d 682, 182 N.E.2d 288. Thereafter, at Willner's request, the Court of Appeals amended its remittitur to recite that
13
'Upon the appeal herein there was presented and necessarily passed upon a question under the Constitution of the United States, viz.: Appellant contended that he was denied due process of law in violation of his constitutional rights under the Fifth and Fourteenth Amendments of the Constitution. The Court of Appeals held that appellant was not denied due process in violation of such constitutional rights.'
14
We granted certiorari, 370 U.S. 934, 82 S.Ct. 1587, 8 L.Ed.2d 805.
15
The issue presented is justiciable. 'A claim of a present right to admission to the bar of a state and a denial of that right is a controversy.' In re Summers, 325 U.S. 561, 568, 65 S.Ct. 1307, 1312, 89 L.Ed. 1795. Moreover, the requirements of procedural due process must be met before a State can exclude a person from practicing law. 'A State cannot exclude a person from the practice of law or from any other occupation in a manner or for reasons that contravene the Due Process or Equal Protection Clause of the Fourteenth Amendment.' Schware v. Board of Bar Examiners, 353 U.S. 232, 238—239, 77 S.Ct. 752, 756, 1 L.Ed.2d 796. As the Court said in Ex parte Garland, 4 Wall. 333, 379, 18 L.Ed. 366, the right is not 'a matter of grace and favor.' We are not here concerned with grounds which justify denial of a license to practice law, but only with what procedural due process requires if the license is to be withheld. This is the problem which Chief Justice Taft adverted to in Goldsmith v. United States Board of Tax Appeals, 270 U.S. 117, 46 S.Ct. 215, 70 L.Ed. 494, involving an application of a certified public accountant to practice before the Board of Tax Appeals. Chief Justice Taft writing for the Court said:
16
'We think that the petitioner having shown by his application that being a citizen of the United States and a certified public accountant under the laws of a state, he was within the class of those entitled to be admitted to practice under the board's rules, he should not have been rejected upon charges of his unfitness without giving him an opportunity by notice for hearing and answer. The rules adopted by the board provide that 'the board may in its discretion deny admission, suspend or disbar any person.' But this must be construed to mean the exercise of a discretion to be exercised after fair investigation, with such a notice, hearing and opportunity to answer for the applicant as would constitute due process.' Id., p. 123, 46 S.Ct. p. 217.
17
We have emphasized in recent years that procedural due process often requires confrontation and cross-examination of those whose word deprives a person of his livelihood. See Greene v. McElroy, 360 U.S. 474, 492, 496—497, 79 S.Ct. 1400, 1411, 1413, 3 L.Ed.2d 1377, and cases cited.2 That view has been taken by several state courts when it comes to procedural due process and the admission to practice law. Coleman v. Watts, Fla., 81 So.2d 650; Application of Burke, 87 Ariz. 336, 351 P.2d 169; In re Crum, 103 Or. 296, 204 P. 948; Moity v. Louisiana State Bar Ass'n, 239 La. 1081, 121 So.2d 87. Cf. Brooks v. Laws, 92 U.S.App.D.C. 367, 208 F.2d 18, 33 (concurring opinion). We think the need for confrontation is a necessary conclusion from the requirements of procedural due process in a situation such as this. Cf. Greene v. McElroy, supra; Cafeteria and Restaurant Workers Union, Local 473 v. McElroy, 367 U.S. 886, 81 S.Ct. 1743, 6 L.Ed.2d 1230.
18
This result is sought to be avoided in several ways. First, it is said that the Committee's action is merely advisory, that it is an investigator not a trier of facts, since under § 90 of the Judiciary Law it is the Appellate Division that ultimately must be convinced of an applicant's good character. The answer is that '(u)nless otherwise ordered by the Appellate Division' (New York Rules of Civil Practice, Rule 1(d)), a favorable certificate from the Committee is requisite to admission by the Appellate Division; and where, as here, the Appellate Division has held no hearings of its own to determine an applicant's character, the role of the Committee is more than that of a mere investigator.
19
Second, it is said that petitioner has sought relief too late. But the Court of Appeals did not reject his petition on that ground. Instead, it stated that it 'necessarily' ruled on the constitutional issue 'presented.' We can only conclude that the Court of Appeals would have found it 'unnecessary' to pass upon any constitutional question if under state law some other ground had existed for denying petitioner relief. See Cincinnati P.B.S. & P. Packet Co. v. Bay, 200 U.S. 179, 182, 26 S.Ct. 208, 50 L.Ed. 428; Lynumn v. Illinois, 372 U.S. 528, 535—536, 83 S.Ct. 917, 921, 9 L.Ed.2d 922.
20
Third, it is said that the record shows that petitioner was not rejected on the basis of ex parte statements but on the basis of his own statements to the Committee. If the Court of Appeals reached this conclusion, the only constitutional question which was presented and which it could have 'necessarily' passed on was whether petitioner was denied due process by not being informed of and allowed to rebut the bases for either the Committee's or the Appellate Division's failure to find his good character. It does not appear from the record that either the Committee or the Appellate Division, at any stage in these proceedings, ever apprised petitioner of its reasons for failing to be convinced of his good character. Petitioner was clearly entitled to notice of and a hearing on the grounds for his rejection either before the Committee or before the Appellate Division. Goldsmith v. Board of Tax Appeals, supra; cf. In re Oliver, 333 U.S. 257, 273, 68 S.Ct. 499, 507, 92 L.Ed. 682. There seems no question but that petitioner was apprised of the matters the Committee was considering.
21
'But a 'full hearing'—a fair and open hearing—requires more than that. * * * Those who are brought into contest with * * * Government in a quasijudicial proceeding aimed at the control of their activities are entitled to be fairly advised of what the Government proposes and to be heard upon its proposals before it issues its final command.' Morgan v. United States, 304 U.S. 1, 18—19, 58 S.Ct. 773, 776, 82 L.Ed. 1129.
22
Petitioner had no opportunity to ascertain and contest the bases of the Committee's reports to the Appellate Division, and the Appellate Division gave him no separate hearing. Yet, '(t)he requirements of fairness are not exhausted in the taking or consideration of evidence, but extend to the concluding parts of the procedure as well as to the beginning and intermediate steps.' Id., at 20, 58 S.Ct. at 777. Cf. Gonzales v. United States, 348 U.S. 407, 414, 75 S.Ct. 409, 413, 99 L.Ed. 467.
23
If the Court of Appeals based its decision on the ground that denying petitioner the right of confrontation did not violate due process, we also hold that it erred for the reasons earlier stated. But because respondent has asserted that the ex parte statements involved in this case played no part in any of the decisions below, we have searched the record to assess this contention. It shows that the Committee had several complaints against petitioner. The various intra-Committee memoranda and reports to the Appellate Division contained in this record support the conclusion that the Committee did in fact rely on these complaints, at least to some extent, in reaching its determinations. And there is no indication in the record that any of the Appellate Division's orders were based solely on petitioner's own statements. Thus, despite respondent's assurances that the Committee never bases its final action on ex parte statements, we cannot say that the Court of Appeals erred in concluding that this constitutional question was 'necessarily' decided.
24
We hold that petitioner was denied procedural due process when he was denied admission to the Bar by the Appellate Division without a hearing on the charges filed against him before either the Committee or the Appellate Division.
25
Reversed.
26
Mr. Justice GOLDBERG, whom Mr. Justice BRENNAN and Mr. Justice STEWART join, concurring.
27
I concur in the opinion and judgment of the Court believing, as I do, that under all of the circumstances here the petitioner was denied procedural due process which the Constitution demands be accorded by the States to applicants for admission to the bar. No conflict exists between constitutional requisites and exaction of the highest moral standards from those who would practice law. See Schware v. Board of Bar Examiners, 353 U.S. 232, 238—239, 77 S.Ct. 752, 755—756, 1 L.Ed.2d 796. Certainly lawyers and courts should be particularly sensitive of, and have a special obligation to respect, the demands of due process. This special awareness, however, does not alter our essential function or duty. In reviewing state action in this area, as in all others, we look to substance, not to bare form, to determine whether constitutional minimums have been honored.
28
The New York admissions procedures described in the opinion of the Court are fairly characteristic of those prevalent throughout the country. In general, they contemplate that an applicant for admission who has successfully passed the bar examination will file an application before a court-appointed committee of lawyers which conducts an inquiry into his moral character and on the basis thereof recommends the grant or denial of admission by the court. Committee proceedings are often informal and, for the protection of the candidate, are generally not publicized. Committee members are usually unpaid and serve in fulfillment of their obligation to the profession and as officers of the court. They perform an indispensable and very often thankless task. While the vast majority of candidates are approved without difficulty, in exceptional cases, such as this, either information supplied by the applicant himself or material developed in the course of the committee's investigation gives rise to questions concerning the applicant's moral character.
29
The constitutional requirements in this context may be simply stated: in all cases in which admission to the bar is to be denied on the basis of character, the applicant, at some stage of the proceedings prior to such denial, must be adequately informed of the nature of the evidence against him and be accorded an adequate opportunity to rebut this evidence. As I understand the opinion of the Court, this does not mean that in every case confrontation and cross-examination are automatically required. It must be remembered that we are dealing, at least at the initial stage of proceedings, not with a court trial, but with a necessarily much more informal inquiry into an applicant's qualifications for admission to the bar. The circumstances will determine the necessary limits and incidents implicit in the concept of a 'fair' hearing. Thus, for example, when the derogatory matter appears from information supplied or confirmed by the applicant himself, or is of an undisputed documentary character disclosed to the applicant, and it is plain and uncontradicted that the committee's recommendation against admission is predicated thereon and reasonably supported thereby, then neither the committee's informal procedures, its ultimate recommendations, nor a court ruling sustaining the committee's conclusion may be properly challenged on due process grounds, provided the applicant has been informed of the factual basis of the conclusion and has been afforded an adequate opportunity to reply or explain. Of course, if the denial depends upon information supplied by a particular person whose reliability or veracity is brought into question by the applicant, confrontation and the right of cross-examination should be afforded. Since admission to the bar is ultimately a matter for the courts, there is ample power to compel attendance of witnesses as required.
30
Application of these principles of this case leads me to concur in the Court's opinion and judgment. The record here, to say the least, is complex, muddled, and in many respects unsatisfactory. We are dealing with an applicant who first applied for admission 25 years ago. Comparison of his applications with facts later confirmed by the petitioner himself suggests a lack of complete candor in dealing with the committee. While this failure to disclose, along with other more recently occurring matters here present, might have supported a refusal to certify the petitioner's character, there are present additional elements which indicate that the committee may have been motivated in its conclusion by charges made against the petitioner by certain informants, the evaluation of which would necessarily depend upon estimates of credibility. The record is not clear whether the petitioner actually requested an opportunity to confront and cross-examine these informants at the time of his first application in the late 1930's. It is plain, however, that he now seeks that opportunity and there is no indication that the state court considered the claim to be untimely. Moreover, at no point are we or the petitioner specifically advised by any finding of the committee or of the state courts as to the precise basis of denial to him of either his original or renewed applications for admission or his requests for reconsideration thereof. In substance, therefore, as the case reaches us, we are confronted with circumstances which, upon sifting, may or may not support the denial of admission to the bar. And our difficulties are compounded by the amended remittitur of the New York Court of Appeals which is fairly susceptible to the reading given it in the Court's opinion—that confrontation is not constitutionally required in a bar admission case such as this in which the character committee appears to have relied, at least in part, for its adverse recommendation upon contradicted information supplied by informers whose credibility was challenged by the applicant. The net result to me, therefore, is that this case, whatever it started out to be, has become one in which due process requires either de novo consideration of the petitioner's application or an orderly sorting out of the issues and an articulated and constitutionally grounded decision on the merits of the petitioner's claims to admission. New York procedures are, I am sure, adequate to effect the proper result upon remand.
31
Mr. Justice HARLAN, whom Mr. Justice CLARK joins, dissenting.
32
The majority and concurring opinions bear witness to the difficulty the Court has had divining from this messy and opaque record whether the case in truth presents a substantial federal question. Obviously much influenced by the amended remittitur of the Court of Appeals, the Court considers that the state courts have held that an applicant for membership in the New York Bar may be denied admission without having had the opportunity at any stage to confront persons whose unfavorable information may have led the Character Committee to refuse to certify the candidate's 'character and fitness.'
33
It would take a great deal to persuade me that either of these experienced and respected New York courts has been guilty of such a questionable constitutional holding. In light of the record, I do not believe that either the Court of Appeals' affirmance or its amended remittitur by any means points to the interpretation which this Court now places on the action of that court. In my view the more reasonable, and correct, interpretation is that the Court of Appeals simply held that, in light of what had gone before,1 the Appellate Division's refusal to entertain petitioner's last de novo application for admission—the eighth proceeding before that court—involved no abuse of its discretion under Rule 1 of the New York Rules of Civil Practice. More particularly, in these prior proceedings no confrontation claim was raised until 1954—some 16 years after the original denial of admission—during which period the matter had already been before the Appellate Division five times (note 1, supra).2
34
So interpreting the Court of Appeals' action, I do not think this case presents a substantial federal question—no more so than did the petition for certiorari which was filed here in 1955, raising this same confrontation question in almost the same context of prior proceedings, and which this Court then denied. In re Willner, 348 U.S. 955, 75 S.Ct. 445, 99 L.Ed. 746.
35
Now that plenary consideration has shed more light on this case than in the nature of things was affirded at the time the petition for certiorari was acted upon, I think the proper course is to dismiss the writ as improvidently granted.
1
In New Jersey the Committee on Character and Fitness is directed by Rule 1:20—6(a) of the Supreme Court Rules to take the following steps in case of an adverse report:
'If the committee believes that an applicant is not of fit character or has not served a satisfactory clerkship, it shall promptly notify the applicant of its intention to file an adverse report as to his moral character or clerkship and of the time, not less than 5 days, within which the applicant may file with the committee a written request for a hearing. If the applicant does not request a hearing within the time fixed by the committee, it shall promptly notify him of its action and file its report with the court for appropriate action by it. If the applicant requests a hearing within the time fixed by the committee, it shall promptly notify him of the time and place of the hearing. The hearing shall be conducted in private and in a formal manner. A complete stenographic record shall be kept and to this end an official court reporter of the county, assigned by the supervising court reporter for that purpose, shall serve the committee and prepare, without additional compensation, such transcripts as may be ordered by it. A transcript may be ordered by the applicant at his own expense. The committee shall submit a report of its findings and conclusions to the court, with a copy to the applicant, for appropriate action by it. An applicant aggrieved by the determination of the committee may, on notice to the committee, petition the court for relief.'
Rule 1:20—6(b) goes on to provide:
'The Board of Bar Examiners, subject to the approval of the court, shall prescribe the procedures to be followed by the committees on character and fitness in the performance of their duties under paragraph (a) of this rule.'
2
Cf. Cafeteria Workers v. McElroy, 367 U.S. 886, 81 S.Ct. 1743, 6 L.Ed.2d 1230, where only 'the opportunity to work at one isolated and specific military installation' was involved. Id., at 896, 81 S.Ct., at 1749.
1
The chronology of events was in substance this: The Appellate Division, upon the Character Committee's refusal to certify the applicant, orginally denied admission in 1938. Refusal of certification had followed petitioner's appearance before the Committee at which, among other things, he had been informed and interrogated about complaints received from two lawyers, Wieder and Dempsey. (Wieder charged that petitioner had not completed his required 'clerkship,' having been discharged from Wieder's office for unsatisfactory performance before the end of the clerkship period. Dempsey's complaint related to certain litigation involving petitioner and one of Dempsey's clients, in which petitioner had been charged with fraud in connection with accountancy services performed for the client.) Apart from these ex parte charges, petitioner in his return to the Committee's written questionnaire had (1) stated that he had not been connected with any law offices, although in a later interview he had informed the Committee that he had in fact been employed in Weider's office for a short time; (2) stated that he had served 'no clerkship,' although he had subsequently informed the Committee of the filing of a certificate of clerkship with the Court of Appeals in Albany; (3) failed to disclose the aforementioned suit brought against him by Dempsey's client; (4) failed to disclose an annulment suit that had been brought against him by his 16-year-old wife, later
stating that he had omitted this information because 'Some people consider it a heinous offense'; and (5) failed to include six other suits or judgments against him among those listed in the questionnaire. The Committee characterized petitioner's demeanor as one of 'general evasiveness.'
Although he made no contemporary effort to obtain review of the original denial of admission, petitioner thereafter sought to attack it before the Appellate Division on four successive occasions during the years 1943—1951—all to no avail. Again, he sought no review of any of these proceedings, one of which involved a de novo hearing before the Character Committee, and in none does he appear to have raised the confrontation claim now made here.
Lack of confrontation seems to have been asserted for the first time in 1954, when petitioner again unsuccessfully moved the Appellate Division for a leave to file a de novo application for admission. Leave to appeal to the New York Court of Appeals, sought then for the first time, was denied, and this Court in turn denied certiorari. 348 U.S. 955, 75 S.Ct. 445, 99 L.Ed. 746.
Finally in 1960 and 1961 petitioner twice more unsuccessfully moved the Appellate Division for leave to file a de novo application for admission, the latter proceeding being the one presently before the Court.
2
In his petition initiating the present proceeding petitioner alleged that during the interviews held in connection with his original application the Chairman of the Character Committee promised him 'a confrontation.' The record, however, discloses no such episode. Indeed at the third Committee hearing in 1938 petitioner was asked whether he had anything further to present and he responded simply by referring to one of the affidavits submitted on his behalf purporting to refute the Wieder charge (note 1, supra). He made no request for confrontation.
| 34
|
373 U.S. 179
83 S.Ct. 1151
10 L.Ed.2d 278
David NAMET, Petitioner,v.UNITED STATES.
No. 134.
Argued March 18, 1963.
Decided May 13, 1963.
John H. Fitzgerald, Chelsea, Mass., for petitioner.
Stephen J. Pollak, Washington, D.C., for respondent.
Mr. Justice STEWART delivered the opinion of the Court.
1
The petitioner was convicted by a jury on two counts of violating the federal wagering tax law, §§ 4411 and 4412 of the Internal Revenue Code of 1954, 26 U.S.C. §§ 4411, 4412. His conviction was affirmed by the Court of Appeals for the First Circuit, 301 F.2d 314. The petitioner contends that his conviction should have been reversed because at his trial the prosecutor was permitted to ask two witnesses incriminating questions concerning their relationship with the petitioner, with the knowledge that the witnesses would invoke their privilege against self-incrimination. We granted certiorari to resolve an asserted conflict with decisions in other circuits. 371 U.S. 858, 83 S.Ct. 115, 9 L.Ed.2d 97.
2
The theory of the prosecution's case was that the petitioner had operated a small gambling ring in Chelsea, Massachusetts. His method of operation, according to the Government's theory, was to visit several neighborhood stores at regular times each day for the purpose of collecting betting receipts and paying off winning bets. One of the shops he visited was a variety store owned by Irving and Annette Kahn.
3
Informations charging violations of the federal wagering tax laws were filed against the petitioner and the Kahns on the same day. All three were represented by the same lawyer, John H. Fitzgerald, and all three pleaded not guilty. On the day of the petitioner's trial, the Kahns changed their pleas to guilty. Because they had previously told government investigators that the petitioner had collected the wagers made in their store and had personally settled accounts with them, the Kahns were subpoenaed to appear at the petitioner's trial.
4
In his opening statement to the jury, the prosecuting attorney stated that he had reason to believe 'a husband and wife' would testify against the petitioner. Upon the completion of the opening statement, Mr. Fitzgerald approached the bench, and the following colloquy took place:
5
'Mr. FITZGERALD: Your Honor, it is my understanding that the United States Attorney is going to attempt to use the Kahns as witnesses.
6
'Now, keeping in mind that they are defendants, that they are entitled not to testify in their own case—
7
'The COURT: They have pleaded guilty.
8
'MR. FITZGERALD: I know that, your Honor, but still I didn't waive any Constitutional privileges in their behalf.
9
'The COURT: I think the law is that they have no Constitutional privileges after they have pleaded.
10
'MR. FITZGERALD: Your Honor, further that they are under investigation by the Internal Revenue Department as far as their income taxes are concerned, and everything else.
11
'The COURT: Well, I haven't seen them take the stand yet, and if they claim the Fifth, I will rule on it then.'
12
After brief testimony by the first government witness, the United States called Annette Kahn. Mr. Fitzgerald repeated his objection for the record, but made no further arguments.1 Mrs. Kahn then testified to her name, her address, the ownership of the store, and her acquaintance with the petitioner. She refused to answer whether she and her husband had 'some type of business relationship' with the petitioner. An extended colloquy at the bench ensued. The court eventually concluded that Mrs. Kahn's plea of guilty to the charge of engaging in the business of accepting wagers deprived her of the right to refuse to testify about her own gambling activity. But the court also ruled that she did not have to testify about any dealings with third persons since she was still, at least theoretically, subject to prosecution for conspiracy, or possibly bribery. Mr. Fitzgerald made no new objections or arguments during this colloquy. To the contrary, he appeared to acquiesce in the questioning of Mrs. Kahn in open court once he had managed to work out a convenient means for advising her when to assert her privilege against self-incrimination.2
13
The questioning of Mrs. Kahn was resumed after a brief recess. The prosecuting attorney began a line of questioning designed to determine whether Mrs. Kahn had known of the gambling tax requirement before the date of her arrest. Mr. Fitzgerald objected, on the ground that the questions were not material. Another conference at the bench was held, in which the prosecuting attorney explained that his purpose was to show that Mrs. Kahn was not in danger of a conspiracy charge. The court sustained Mr. Fitzgerald's objection to the materiality of the questions. The interrogation was then discontinued.
14
After another recess, the Government resumed the presentation of its case by calling its other witnesses. Their testimony established the following case for the prosecution: The petitioner had been under surveillance by the government agents for one month. They had observed him following the same route twice a day, stopping for a few minutes in each of several variety and cigar stores. During the petitioner's afternoon round, the pockets in his coat became progressively more bulging, inferentially with material gathered in each of the stores. Petitioner returned home with the material. No persons were seen to enter his home between his arrival after the afternoon round and his departure the next morning for the morning round. Expert testimony was introduced showing that the petitioner's activities were consistent with those of a principal in a gambling operation. The afternoon visits during which his pockets became filled, it was testified, indicated a pick-up of the day's betting slips, and the morning visits would fit a pattern of 'setting-up' the store owners to pay off the previous day's winning bets. The absence of any apparent contact with other persons after the petitioner's afternoon round would indicate that he himself was acting as banker for the enterprise, and was not passing the money on to another principal. The final ingredient of the Government's case was certain material found during a search of the petitioner's home. This consisted of 'slips of number pool wagers,' 'daily double horse bet slips,' and over $1,000 cash in bills of small denominations. The gambling slips were identified by experts as those normally held by the 'bookie' rather than by the bettor.
15
One of the key issues which developed during this part of the case was the question of whether the places regularly visited by the petitioner were, in fact, known gambling establishments. The court sustained objections by Mr. Fitzgerald to such testimony by government agents, on the ground that the agents coudl not testify to events observed when the petitioner was not present.
16
The Government then called Irving Kahn to the stand. No objection was made. Mr. Kahn testified voluntarily that he owned the store in question, and that he was acquainted with the petitioner. After being directed to answer by the court, he testified that he had had dealings with the petitioner. And, when a second claim of privilege was overruled, he also testified that he had accepted wagers in his store. In the questioning which followed, the witness testified that the petitioner did come to his store 'a couple of times a week,' but denied that the petitioner came every day in the morning and afternoon.
17
In the course of this interrogation the witness was asked a total of only four questions to which his refusal to answer was sustained.3 At no time during this questioning did Mr. Fitzgerald object to the questions on behalf of the petitioner, nor did he request any instructions regarding the inferences the jury might draw from these refusals to answer. Indeed, counsel attempted in his closing argument to utilize that part of Irving Kahn's testimony which had contradicted the Government's evidence about the regularity of the petitioner's visits. The closing arguments for the Government contained no references to the Kahns' refusal to answer, and the jury was not told that the Kahns had been arrested or charged together with the petitioner.
18
The court's instructions to the jury contained the following statement with regard to the Kahns' testimony:
19
'Nor should any inference be drawn against him because the Kahns refused to testify, unless it would be a logical inference that would appeal to you as having a direct bearing upon the defendant's guilt.'
20
Mr. Fitzgerald made no objection whatever to this part of the instructions.
21
In turning to the petitioner's argument that his conviction must be set aside because of the circumstances described, we emphasize at the outset what this case does not involve. No constitutional issues of any kind are presented. The petitioner does not claim any infringement of his Fifth Amendment privilege against self-incrimination.4 He does not contend that the Kahns were in any way prejudiced by their assertion of this constitutional privilege.5 All that this case involves, in short, is a claim of evidentiary trial error.
22
The petitioner's principal contention is that reversible error was committed in permitting the Government to question the Kahns after it was known that they were going to claim their privilege not to incriminate themselves. It is said that when a witness is asked whether he participated in criminal activity with the defendant, a refusal to answer based on the privilege against self-incrimination tends to imply to the jury that a truthful answer would be in the affirmative. This inference, the petitioner argues, cannot properly be used as evidence against a criminal defendant. To support this argument, the petitioner relies on dicta in several federal cases and upon the decision in United States v. Maloney, 262 F.2d 535, in which the Court of Appeals for the Second Circuit said, 'Such refusals (to testify) have been uniformly held not to be a permissible basis for inferring what would have been the answer, although logically they are very persuasive.' Id., 262 F.2d at 537.6
23
None of the several decisions dealing with this question suggests that reversible error is invariably committed whenever a witness claims his privilege not to answer. Rather, the lower courts have looked to the surrounding circumstances in each case, focusing primarily on two factors, each of which suggests a distinct ground of error. First, some courts have indicated that error may be based upon a concept of prosecutorial misconduct, when the Government makes a conscious and flagrant attempt to build its case out of inferences arising from use of the testimonial privilege. This seems to have been one of the principal reasons underlying the finding of reversible error in United States v. Maloney, supra. In that case, the prosecution admitted knowing that two of its key witnesses could validly invoke the privilege against self-incrimination and intended to do so. The prosecutor nevertheless called and questioned them. The court also found that the Government's closing argument attempted to make use of the adverse inferences from their refusals to testify. See also United States v. Tucker, 3 Cir., 267 F.2d 212. A second theory seems to rest upon the conclusion that, in the circumstances of a given case, inferences from a witness' refusal to answer added critical weight to the prosecution's case in a form not subject to cross-examination, and thus unfairly prejudiced the defendant. This theory seems also to have been present to some extent in the Maloney decision, where the court noted that the challenged inferences were the only corroboration for dubious and interested testimony by the Government's chief witness. 262 F.2d, at 536—537. On the other hand, courts have failed to find reversible error when such episodes were 'no more than minor lapses through a long trial.' United States v. Hiss, 185 F.2d 822, 832 (C.A.2d Cir.). See also United States v. Amadio, 215 F.2d 605, 614 (C.A.7th Cir.). And even when the objectionable inferences might have been found prejudicial, it has been held that instructions to the jury to disregard them sufficiently cured the error.7
24
The petitioner appears to contend that error was committed under both theories. He stresses the fact that the prosecutor had advance notice of the Kahns' intention to invoke the Fifth Amendment, but questioned them nevertheless. He also argues that the inferences from the Kahns' refusals to testify were crucial to the Government's case, pointing out that the rest of the Government's evidence against the petitioner was entirely circumstantial.
25
We need not pass upon the correctness of the several lower court decisions upon which the petitioner relies,8 for we think that even within the basic rationale of those cases reversible error was not committed in this case. In the first place, the record does not support any inference of prosecutorial misconduct. It is true, of course, that Mr. Fitzgerald announced that the Kahns would invoke their testimonial privilege if questioned. But certainly the prosecutor need not accept at face value every asserted claim of privilege, no matter how frivolous. In this case, the prosecutor initially did not believe that the Kahns could properly invoke their privilege against self-incrimination, reasoning with some justification that their plea of guilty to the gambling charge would erase any testimonial privileges as to that conduct. His view of the law was supported by substantial authority, cf. Reina v. United States, 364 U.S. 507, 513, 81 S.Ct. 260, 264, 5 L.Ed.2d 249, and was in fact upheld by the trial judge. Although it was later ruled that the guilty plea did not render all of the Kahns' conduct immune from further prosecution, thus making testimony as to that conduct privileged, there remained an independent and quite proper reason to call the Kahns as witnesses. Both Mr. and Mrs. Kahn possessed nonprivileged information that could be used to corroborate the Government's case. They could, and did, testify that they knew the petitioner, that he did frequently visit their variety store, and that they themselves had engaged in accepting wagers. The Government had a right to put this evidence before the jury.
26
Moreover, the bulk of Mrs. Kahn's interrogation, including the only question involving privileged information, occurred before the court ruled that she had a limited testimonial privilege. Although Mr. Kahn was called to the stand somewhat later, there had developed, at that time, still another clearly permissible reason for calling him. The court's rulings during the questioning of the intervening witnesses had prevented the Government from introducing most of the evidence it had planned to use to show that the stores on the petitioner's daily route were engaged in gambling. Mr. Kahn had pleaded guilty to accepting wagers, and under the District Court's prior ruling his testimony that he had accepted wagers in his store was clearly not privileged. He did so testify, after the court directed him to answer. In the course of eliciting this and other relevant testimony, the prosecutor asked only four questions held to be privileged.
27
We cannot find that these few lapses, when viewed in the context of the entire trial, amounted to planned or deliberate attempts by the Government to make capital out of witnesses' refusals to testify. We are particularly reluctant to fasten such motives on the Government's conduct when, as here, defense counsel not only failed to object on behalf of the defendant, but in many instances actually acquiesced in the procedure as soon as the rights of the witnesses were secured.
28
Nor can we find that the few invocations of privilege by the Kahns were of such significance in the trial that they constituted reversible error even in the absence of prosecutorial misconduct. The effect of these questions was minimized by the lengthy nonprivileged testimony which the Kahns gave. They testified about the conduct of gambling operations in their store, as well as their general association with the petitioner. Once these facts were admitted by the Kahns themselves, after government agents had testified to the petitioner's daily visits, a natural and completely permissible inference could be drawn linking the petitioner's visits with the admitted gambling operation. Thus the present case is not one, like Maloney, in which a witness' refusal to testify is the only source, or even the chief source, of the inference that the witness engaged in criminal activity with the defendant. In this case the few claims of testimonial privilege were at most cumulative support for an inference already well established by the nonprivileged portion of the witness' testimony.
29
It should be borne in mind that nothing in this case presents the issue whether the petitioner would have been entitled to instructions or other curative devices9 if he had asked for them. No such requests were ever made. Far from it, Mr. Fitzgerald impliedly accepted the Kahns' testimony and attempted to use it on behalf of the petitioner in his argument to the jury. The petitioner would have us hold that even in these circumstances the court committed reversible error because it did not, sua sponte, take some affirmative action. We see no reason to require such extravagant protection against errors which were not obviously prejudicial and which the petitioner himself appeared to disregard.10
30
There remains for consideration a question concerning the correctness of the court's instruction on the subject of the Kahns' refusals to testify. This issue was nowhere mentioned in the petition for certiorari in this Court, and under our rules it is not before us.11 Even if it were, we could not find that the instruction amounted to reversible error on the facts of this case. No objection was ever made to this instruction, even though counsel for the petitioner did object to other aspects of the charge. Thus, we are not concerned with whether the instruction was right, but only whether, assuming it was wrong, it was a plain error or defect 'affecting substantial rights' under Rule 52(b) of the Federal Rules of Criminal Procedure.12 What has been said concerning the very limited effect of any inferences arising from the Kahns' refusals to testify makes it clear that this brief passage in the charge could not have affected any substantial rights of the petitioner.
31
Affirmed.
32
Mr. Justice BLACK, with whom Mr. Justice DOUGLAS concurs, dissenting.
33
I believe it was error for the trial court to permit the prosecuting attorney in the presence of the jury to ask questions which he well knew the witnesses would refuse to answer on the ground of self-incrimination. And I cannot conclude that this error was not prejudicial to the defendant. Certainly the prosecutor must have thought the refusals to answer would help the State's case; otherwise, he would not have asked the questions that he knew would not be answered. One need only glance at the questions set out in note 3 of the majority opinion to see that, as people ordinarily reason, the jury would have inferred that the witnesses refused to answer so that they would not have to admit that they had been engaged in violating the gambling laws with the defendant. Indeed, a part of the court's charge, to which no exception was taken, left the jury free to infer this defendant's guilt from the refusal of the Kahns to answer the questions.* To my way of thinking, this is an unfair way of getting convictions and should not be condoned by the Court's treating these questions as minor lapses or by its speculation as to how good or bad the motives of the prosecutor were. Nor can I agree that the defendant either disregarded or acquiesced in the trial court's erroneously permitting the jury to be influenced by the witnesses' claim of privilege. Even before the witnesses were put on the stand by the prosecutor, defendant's counsel warned the court and the prosecutor that the privilege would be claimed, and later, when examination of the witnesses had begun, the court acknowledged not only the right to claim the Fifth Amendment's privilege under the circumstances but also the court's intention to sustain the claim if made. The court nevertheless allowed the Government to proceed with its examination, during which the jury heard the witnesses claim, and the court sustain, their privilege in refusing to answer several questions put to them. True counsel for defendant later tried, as any good lawyer would, to turn this bad situation to his advantage by referring to it. But this took place after the trial court had permitted the poisonous questions to be asked over the original objections. This was not acquiescence in error. I would reverse.
1
'MR. FITZGERALD: Your Honor, may the record show that I object to the use of this witness.
'The COURT: All right, it may be noted.'
2
'MR. FITZGERALD: Your Honor, may I stand beside her while she testifies, being her counsel?
'The COURT: Well, I would rather have you not stand beside her, because that could impress the jury.
'But ask the questions slowly, and you can take your objection each time.
'MR. FITZGERALD: Your Honor, if I should rise in my chair, may that be taken that she pleads the Fifth Amendment?
'The COURT: Yes. Now, the question pending is what?'
3
'Can you tell us what those dealings (the witness' dealings with the petitioner) were?'
'And were you paid a commission on all the bets you took in your variety store?'
'Who did you accept the bets for that you took in your variety store?'
'Did you ever take bets for the defendant David Namet?'
4
The petitioner did not take the stand. The court's instruction concerning this fact was as follows:
'* * * you must not draw any inference from the fact that the defendant himself did not take the stand. He doesn't have to. He can sit mute and stand or fall upon the Government's case. Or he may take the stand as he wishes. But from the fact that he didn't take it, you should not draw any inference against him.'
5
Cf. Grunewald v. United States, 353 U.S. 391, 415—424, 77 S.Ct. 963, 979—984, 1 L.Ed.2d 931; Konigsberg v. State Bar, 353 U.S. 252, 77 S.Ct. 722, 1 L.Ed.2d 810.
6
See United States v. Tucker, 3 Cir., 267 F.2d 212, 215; United States v. Gernie, 2 Cir., 252 F.2d 664; United States v. Romero, 2 Cir., 249 F.2d 371; United States v. Cioffi, 2 Cir., 242 F.2d 473; United States v. Amadio, 7 Cir., 215 F.2d 605; United States v. Hiss, 2 Cir., 185 F.2d 822; Weinbaum v. United States, 9 Cir., 184 F.2d 330; United States v. 5 Cases, etc., 2 Cir., 179 F.2d 519. See generally 86 A.L.R.2d Ann. 1443.
7
See, e.g., United States v. Gernie, 252 F.2d 664 (C.A.2d Cir.); Weinbaum v. United States, 184 F.2d 330 (C.A.9th Cir.). See also United States v. Maloney, supra, 262 F.2d at 538.
8
See generally Grunewald v. United States, 353 U.S. 391, 415—426, 77 S.Ct. 963, 979—985, 1 L.Ed.2d 931; Stewart v. United States, 366 U.S. 1, 81 S.Ct. 941, 6 L.Ed.2d 84.
9
The Government has suggested that in appropriate circumstances the defendant may be entitled to request a preliminary screening of the witness' testimony, outside the hearing of the jury.
10
Finding, as we do, that this case involves neither misconduct by the prosecution nor inferences of material importance, we need not pass upon the holding in United States v. Maloney, supra, that a failure to give proper curative instructions when such elements are present constitutes plain error.
11
The issue was brought to this Court's attention in the Government's memorandum in reply to the petition.
Rule 23, par. 1(c) of the Supreme Court Rules provides, 'Only the questions set forth in the petition or fairly comprised therein will be considered by the court.'
12
Rule 30 provides, in pertinent part: 'No party may assign as error any portion of the charge or omission therefrom unless he objects thereto before the jury retires to consider its verdict, stating distinctly the matter to which he objects and the grounds of his objection. Opportunity shall be given to make the objection out of the hearing of the jury.'
Rule 52 provides:
'(a) Harmless Error. Any error, defect, irregularity or variance which does not affect substantial rights shall be disregarded.
'(b) Plain Error. Plain errors or defects affecting substantial rights may be noticed although they were not brought to the attention of the court.'
*
'Nor should any inference be drawn against him (petitioner) because the Kahns refused to testify, unless it would be a logical inference that would appeal to you as having a direct bearing upon the defendant's guilt.'
| 01
|
373 U.S. 238
83 S.Ct. 1265
10 L.Ed.2d 321
William SMITH, Jr., Petitioner,v.STATE OF MISSISSIPPI.
No. 667.
Argued April 30, 1963.
Decided May 13, 1963.
Morris B. Abram. Atlanta, Ga., for petitioner.
G. Garland Lyell, Jr., Jackson, Miss., for respondent.
PER CURIAM.
1
The petitioner was convicted of rape by a jury in the Circuit Court of Madison County, Mississippi, and sentenced to death. The conviction was affirmed by the Supreme Court of Mississippi. Miss., 139 So.2d 857. We granted petitioner's motion for leave to proceed in forma pauperis, and his petition for certiorari which presented several claims of alleged denial of rights secured to him by the Fourteenth Amendment. 371 U.S. 939, 83 S.Ct. 323, 9 L.Ed.2d 274. After oral argument and study of the record, we have reached the conclusion that the record is not sufficient to permit decision of his constitutional claims. The writ is therefore dismissed as improvidently granted, without prejudice to an application for federal habeas corpus relief under 28 U.S.C. § 2241 after exhaustion of any state remedies still open to him. See 28 U.S.C. § 2254; Fay v. Noia, 372 U.S. 391, 435, 83 S.Ct. 822, 847, 9 L.Ed.2d 837.
2
Upon the effective date of our action today, the stay of execution granted October 5, 1962, by MR. JUSTICE BLACK expires of its own terms. We see no reason, however, to continue the stay in effect. Although the Mississippi Supreme Court, see Miss., 145 So.2d 688, reserved to the State the right, upon this Court's disposition of the writ of certiorari, to apply for an order fixing a new execution date, we assume that that court will not act on application of the State without affording petitioner an opportunity to pursue with due diligence any available state remedies and, if necessary, the remedy in federal habeas corpus.
3
Writ dismissed.
| 89
|
373 U.S. 206
83 S.Ct. 1185
10 L.Ed.2d 297
Frederico Marin GUTIERREZ, Petitioner,v.WATERMAN STEAMSHIP CORP.
No. 229.
Argued March 21, 1963.
Decided May 13, 1963.
Rehearing Denied June 17, 1963.
See 374 U.S. 858, 83 S.Ct. 1863.
Harvey B. Nachman, San Juan, P.R., for petitioner.
Antonio M. Bird, San Juan, P.R., for respondent.
Mr. Justice WHITE delivered the opinion of the Court.
1
Petitioner, a longshoreman unloading the S.S. Hastings at Ponce, Puerto Rico, slipped on some loose beans spilled on the dock and suffered personal injuries. He subsequently filed a libel against the Hastings, claiming damages for injuries caused by the ship's unseaworthiness and by the negligence of its owner, the respondent corporation. The case was tried in admiralty before the United States District Court for the District of Puerto Rico, and the court found the following facts relevant in the present posture of the case. 193 F.Supp. 894.
2
The cargo of beans was packed in broken and defective bags, some of which were being repaired by coopers aboard the ship during unloading. Beans spilled out of the bags during unloading, including some from one bag which broke open during unloading, and the scattering of beans about the surface of the pier created a dangerous condition for the longshoremen who had to work there. The shipowner knew or should have known that injury was likely to result to persons who would have to work around the beans spilled from the defective bags, and it was negligent in allowing cargo so poorly stowed or laden to be unloaded. Petitioner fell on the beans and injured himself, and such injuries were proximately caused by the respondent's negligence and the unseaworthiness of its cargo or cargo containers.
3
Although petitioner filed his libel over a year after the analogous Puerto Rican statute of limitations ran,1 the court found that the delay was excusable and that no prejudice to respondent was occasioned by the delay, since it had access at all times to its and the stevedore's2 records which contained the relevant facts and since all the potential witnesses were available and produced at trial. Accordingly, the trial court entered a money judgment of some $18,000 for petitioner.
4
Respondent appealed to the United States Court of Appeals for the First Circuit, which reversed with directions to dismiss the action. 301 F.2d 415. It held that respondent had not been negligent, as a matter of law, because it 'had neither control of nor even a right to control' the pier. The court also stated that petitioner did not prove what particular beans he slipped on, and that the ones responsible for his fall might have come from a bag that 'for all that appears' may have been dropped and broken open due to some third party's negligence. As for seaworthiness, the court held that the shipowner was not responsible for the lading or cargo containers, stating: 'The very fact that unseaworthiness obligations are 'awesome,' * * * suggests that they should not be handled with prodigality. We are unwilling to recognize one here.' Finally, it reversed the conclusion below as to laches, since the availability to respondent of the witnesses when the libel was filed was not as advantageous to it as would have been an opportunity to examine them at an earlier date. That this was prejudicial, the court concluded, was shown by the fact that the witnesses' testimony was at variance with respondent's records of the ship's unloading. Petitioner sought certiorari from this adverse judgment and we brought the case here, 371 U.S. 810, 83 S.Ct. 40, 9 L.Ed.2d 53, to resolve the apparently troublesome question as to the shipowner's liability for his torts which have impacts on shore. We have concluded that the judgment of the Court of Appeals must be reversed with respect to each of the three headings involved.
I.
5
At the outset we are met with an issue which is said to be jurisdictional. Counsel for respondent candidly admits failure to raise the point below, but as is our practice we will consider this threshold question before reaching the merits. McGrath v. Kristensen, 340 U.S. 162, 167—168, 71 S.Ct. 224, 228, 95 L.Ed. 173; Ford Motor Co. v. Department of Treasury, 323 U.S. 459, 467, 65 S.Ct. 347, 352, 89 L.Ed. 389; Matson Nav. Co. v. United States, 284 U.S. 352, 359, 52 S.Ct. 162, 165, 76 L.Ed. 336 (admiralty case); Grace v. American Cent. Ins. Co., 109 U.S. 278, 283, 3 S.Ct. 207, 209, 27 L.Ed. 932; Hope Ins. Co. of Providence v. Boardman, 5 Cranch 57, 3 L.Ed. 36; see Wheeldin v. Wheeler, 371 U.S. 812, 83 S.Ct. 58, 9 L.Ed.2d 54; Brown Shoe Co. v. United States, 370 U.S. 294, 305—306, 83 S.Ct. 1502, 1512—1513, 8 L.Ed.2d 510.
6
Respondent contends that it is not liable, at least in admiralty, because the impact of its alleged lack of care or unseaworthiness was felt on the pier rather than aboard ship. Whatever validity this proposition may have had until 1948, the passage of the Extension of Admiralty Jurisdiction Act, 62 Stat. 496, 46 U.S.C. § 740, swept it away when it made vessels on navigable water liable for damage or injury 'notwithstanding that such damage or injury be done or consummated on land.' Respondent and the carrier amici curiae would have the statute limited to injuries actually caused by the physical agency of the vessel or a particular part of it—such as when the ship rams a bridge or when its defective winch drops some cargo onto a longshoreman. Cf. Strika v. Netherlands Ministry of Traffic, 185 F.2d 555 (C.A.2d Cir.); Hagans v. Farrell Lines, 237 F.2d 477 (C.A.3d Cir.). Nothing in the legislative history supports so restrictive an interpretation of the statutory language. There is no distinction in admiralty between torts committed by the ship itself and by the ship's personnel while operating it, any more than there is between torts 'committed' by a corporation and by its employees. And ships are libeled as readily for an unduly bellicose mate's assault on a crewman, see Boudoin v. Lykes Brothers Steamship Co., 348 U.S. 336, 339—340, 75 S.Ct. 382, 384—385, 99 L.Ed. 354; The Rolph, 299 F. 52 (C.A.9th Cir.), or for having an incompetent crew or master, see Keen v. Overseas Tankship Corp., 194 F.2d 515, 517 (C.A.2d Cir.), as for a collision. Various farfetched hypotheticals are raised, such as a suit in admiralty for an ordinary automobile accident involving a ship's officer on ship business in port, or for someone's slipping on beans that continue to leak from these bags in a warehouse in Denver. We think it sufficient for the needs of this occasion to hold that the case is within the maritime jurisdiction under 46 U.S.C. § 740 when, as here, it is alleged that the shipowner commits a tort3 while or before the ship is being unloaded, and the impact of which is felt ashore at a time and place not remote from the wrongful act.
II.
7
As indicated, supra, the trial court found respondent negligent in allowing the beans to be unloaded in their defective bagging, when it knew or should have known that injury was likely to result to persons having to work about the beans that might, and did, spill. There was substantial evidence to support these findings. Witnesses testified that beans spilled out of broken bags throughout unloading, and this is corroborated by respondent's records of the unloading which stated that bags of beans were found torn at the time of discharging and some of them were re-coopered. Moreover, the trial court was entitled to infer that respondent should have known of the defective condition of the bagging when the bean bags were leaking while still in the ship, when beans spilled out of the bags throughout unloading, and when coopers were sent aboard to repair the torn bagging. To be sure, there is some conflict between details of the testimony and respondent's records of the unloading, but the trial court was entitled to believe the one rather than the other. As for the possibility that the beans petitioner slipped on may have come from some other source, such as 'for all that appears' a third party, it is sufficient to note that the trial court was not plainly erroneous in not so believing.
8
The force of these fact findings is not lessened by the contention that respondent did not control the pier or have 'even a right to control that locus,' 301 F.2d, at 416. We doubt that respondent had no license to go upon the pier at which it was docked and clean up the loose beans, if it had wanted to; the beans were its cargo that it was unloading onto the pier. But we may put this aside, since control of the impact zone is not essential for negligence. The man who drops a barrel out of his loft need not control the sidewalk to be liable to the pedestrian whom the barrel hits. See Byrne v. Boadle, 2 H. & C. 722 (Exch.). And the same holds for the man who spills beans out his window, on which the pedestrian slips. Respondent allowed the cargo to be discharged in dangerous and defective bagging, from which beans were leaking before discharge of the cargo began. It had an absolute and nondelegable duty of care toward petitioner not to create this risk to him, which it failed to meet. When this lack of care culminated in petitioner's injury, respondent became legally liable to compensate him for the harm.
III.
9
The trial court also found unseaworthiness in the condition of the bagging. Two questions are raised in this connection: (1) whether the use of defective cargo containers constitutes unseaworthiness, and (2) whether the shipowner's warranty of seaworthiness extends to longshoremen on the pier who are unloading the ship's cargo.
10
The first question is not one of first impression, for it was decided in petitioner's favor in Atlantic & Gulf Stevedores, Inc. v. Ellerman Lines, Ltd., 369 U.S. 355, 82 S.Ct. 780, 7 L.Ed.2d 798. There a longshoreman was injured when a bale of burlap cloth fell on him because the metal bands wrapped about the bales, cf. Cotton-Tie Co. v. Simmons, 106 U.S. 89, 1 S.Ct. 52, 27 L.Ed. 79, broke while the bales were being hoisted with a hook and winch. The trial court charged the jury that 'if you find that the bands of the bale were defective, were inadequate, or insufficient * * * then you might find the defendants liable under the doctrine of unseaworthiness.' Id., at 361, n. 3, 82 S.Ct., at 784. The charge became critical in the posture of the case before this Court because the Court of Appeals had reversed the portion of the judgment in favor of the stevedore on the shipowner's claim for indemnity because both had been negligent, in the Court of Appeals' view of the jury's special findings. This Court reinstated the original judgment because 'there is a view of the case that makes the jury's answers to special interrogatories consistent,' namely, on the matter covered by the proper charge on unseaworthiness, and therefore the interrogatories 'must be resolved that way * * * (to avoid) a collision with the Seventh Amendment.' Id., at 364, 82 S.Ct., at 786. That unseaworthiness could be predicated upon the defectiveness of the metal bands wrapped around and used to contain the burlap cargo was thus essential to the disposition of the case.
11
The holding in Ellerman is consistent with earlier decisions.4 Seaworthiness is not limited, of course, to fitness for travel on the high seas; it includes fitness for loading and unloading. Seas Shipping Co. v. Sieracki, 328 U.S. 85, 66 S.Ct. 872, 90 L.Ed. 1099. It has already been held that when cargo is stowed unsafely in the hold a longshoreman injured thereby may recover for unseaworthiness. E.g., Rich v. Ellerman & Bucknall S.S. Co., 278 F.2d 704, 706 (C.A.2d Cir.); Curtis v. A. Garcia y Cia., 241 F.2d 30, 33—34 (C.A.3d Cir.); Palazzolo v. Pan-Atlantic S.S. Corp., 211 F.2d 277, 279 (C.A.2d Cir.), aff'd on other grounds, 350 U.S. 124, 134, 76 S.Ct. 232, 237, 100 L.Ed. 133; see Morales v. City of Galveston, 370 U.S. 165, 170, 82 S.Ct. 1226, 1229, 8 L.Ed.2d 412 (dictum).5 And in at least one case it has been held that a longshoreman could recover for injuries caused by a 'latent defect' in a cargo crate which broke when the longshoreman stood on it. Reddick v. McAllister Lighterage Line, 258 F.2d 297, 299 (C.A.2d Cir.).
12
These cases all reveal a proper application of the seaworthiness doctrine, which is in essence that things about a ship, whether the hull, the decks, the machinery, the tools furnished, the stowage, or the cargo containers, must be reasonably fit for the purpose for which they are to be used. See Mitchell v. Trawler Racer, Inc., 362 U.S. 539, 550, 80 S.Ct. 926, 4 L.Ed.2d 941; Morales v. City of Galveston, 370 U.S. 165, 169, 172, 82 S.Ct. 1226, 1229, 1230 (dissenting opinion). A ship that leaks is unseaworthy; so is a cargo container that leaks. When the shipowner accepts cargo in a faulty container or allows the container to become faulty, he assumes the responsibility for injury that this may cause to seamen or their substitutes on or about the ship. Beans belong inside their containers, and anyone should know, as the trial court found, that serious injury may result if they get out of their containers and get underfoot. These bean bags were unfit and thus unseaworthy.
13
The second question is one of first impression in this Court, although other federal courts have already recognized that the case law compels this conclusion. Strika v. Netherlands Ministry of Traffic, 185 F.2d 555 (C.A.2d Cir.); Robillard v. A. L. Burbank & Co., 186 F.Supp. 193 (S.D.N.Y.); see Pope & Talbot, Inc., v. Cordray, 258 F.2d 214, 218 (C.A.9th Cir.). In Strika, while the longshoreman was working on the dock, use of an improper wire cable caused a hatch cover to fall on him. Building on such cases as O'Donnell v. Great Lakes Dredge & Dock Co., 318 U.S. 36, 63 S.Ct. 488, 87 L.Ed. 596, where seamen recovered under the Jones Act for injuries due to the owner's negligence despite their being ashore at the time, and Sieracki, supra, where longshoremen aboard ship doing seamen's tasks were permitted to recover for unseaworthiness, the court held that the tort of unseaworthiness arises out of a maritime status or relation and is therefore 'cognizable by the maritime (substantive) law whether it arises on sea or on land.' Accordingly, the court permitted recovery for unseaworthiness. See also Hagans v. Farrell Lines, 237 F.2d 477 (C.A.3d Cir.), where the point was assumed in a case involving a longshoreman on the pier struck with sacks of beans when a defective winch did not brake properly.
14
In Robillard, supra, a longshoreman was injured when, because of unseaworthy stowage and overladen drafts, he was struck by some cargo that was knocked off the deck onto the pier. The court found 'the logic of these authorities * * * (Sieracki, Strika, etc.) ineluctable' and allowed recovery in unseaworthiness while denying it in negligence.
15
We agree with this reading of the case law and hold that the duty to provide a seaworthy ship and gear, including cargo containers, applies to longshoremen unloading the ship whether they are standing aboard ship or on the pier.
IV.
16
Finally, we have concluded that the ruling of the trial court on laches is not plainly erroneous and should not have been reversed. The test of laches is prejudice to the other party. Gardner v. Panama R. Co., 342 U.S. 29, 30—31, 72 S.Ct. 12, 13, 96 L.Ed. 31; Cities Service Oil Co. v. Puerto Rico Lighterage Co., 305 F.2d 170, 171 (C.A.1st Cir.) (both unreasonable delay and consequent prejudice). The trial court, having heard the witnesses testify, concluded that there was no prejudice. The Court of Appeals had no warrant to reverse this finding as plainly erroneous merely because in some way it might have been more advantageous to respondent to question the witnesses sooner than it did.6 Nor can prejudice be inferred from a variance between the witnesses' testimony and respondent's written records of the unloading. The trial court which heard the witnesses was the proper judge of which evidence was credible; that records differ from testimony here does not mean that respondent was prejudiced by delay—it means that respondent was 'prejudiced' by the fact finder's refusal to believe its evidence and no more.
17
The Court of Appeals erred in setting the judgment of the District Court aside. The judgment of the Court of Appeals is reversed and the case remanded to the District Court for further proceedings consistent with this opinion.
18
It is so ordered.
19
Judgment of Court of Appeals reversed and case remanded to District Court with directions.
20
Mr. Justice HARLAN (dissenting).
21
The decision in this case has importance in admiralty law beyond what might appear on the surface. It marks another substantial stride toward the development by this Court of a doctrine that a shipowner is an insurer for those who perform any work on or around a ship subject to maritime jurisdiction. While my primary disagreement with the Court goes to its holding on unseaworthiness, I am also unable to agree with its views on the negligence issue.
I.
22
The shipowner's duty with respect to seaworthiness is a duty to furnish a vessel that is reasonably fit for its intended use one that is staunch and strong, that is fitted out with all proper equipment and in good order, and that carries a sufficient and competent crew and complement of officers. Gilmore and Black, The Law of Admiralty, 158. As developed by this Court in cases involving injury to seamen and dock workers, the duty has become absolute and has been found to reach even transitory conditions arising after the outset of the voyage. See Mitchell v. Trawler Racer, Inc., 362 U.S. 539, 80 S.Ct. 926, 4 L.Ed.2d 941. But, except for the few unpersuasive instances noted in this opinion, the obligation has remained one relating essentially to the ship and its appurtenances. See id., at 550, 80 S.Ct. at 933. Although the doctrine has been extended in my view, quite questionably—to equipment brought on board by a stevedore, see Alaska S.S. Co. v. Petterson, 347 U.S. 396, 74 S.Ct. 601, 98 L.Ed. 798,1 the shipowner has not been deemed an insurer of the condition of the cargo. His duty with respect to cargo has been to see that it is stowed in a manner that does not make the ship itself an unsafe place to work. See, e.g., Palazzolo v. Pan-Atlantic S.S. Corp., 2 Cir., 211 F.2d 277; Curtis v. A. Garcia y Cia., 3 Cir., 241 F.2d 30; Rich v. Ellerman & Bucknall S.S. Co., 2 Cir., 278 F.2d 704; Carabellese v. Naviera Aznar, S.A., 2 Cir., 285 F.2d 355.2
23
The Court, however, has concluded that it is bound by the determination last Term, in Atlantic & Gulf Stevedores, Inc., v. Ellerman Lines, Ltd., 369 U.S. 355, 82 S.Ct. 780, 7 L.Ed.2d 798, to hold that defective cargo may in and of itself render the shipowner liable for unseaworthiness. I must admit that some language in that case (369 U.S., at 364, 82 S.Ct., at 786) does appear to stand for this proposition. But I think it fair to suggest that it was negligence, not unseaworthiness, on which attention was focused there—indeed unseaworthiness was neither briefed nor argued. At all events I am frank to say that in concurring in the result in that case, unseaworthiness as a distinct issue entirely eluded me, as it evidently did the dissenters, who interpreted the majority opinion as suggesting that the jury's finding was premised on a negligent failure to inspect the cargo containers. See 369 U.S., at 365, 82 S.Ct. at 786. Moreover, the case cited by the Ellerman Court in support of its unseaworthiness conclusion, Weyerhaeuser S.S. Co. v. Nacirema Operating Co., 355 U.S. 563, 78 S.Ct. 438, 2 L.Ed.2d 491, did not even touch upon such an issue. So casual a determination should not be blindly accepted as fastening on the law of admiralty such a far-reaching innovation. At least it should not preclude us from considering the question anew when it is now fully and squarely presented.3
24
The Court's decision after Ellerman, in Morales v. City of Galveston, 370 U.S. 165, 82 S.Ct. 1226, 8 L.Ed.2d 412, is the strongest evidence that Ellerman was not regarded as establishing the fundamental change in the law of unseaworthiness for which it is now cited. In Morales, a longshoreman working in the hold of a ship had been injured by the fumes emanating from grain that had been improperly treated with an excessive amount of a chemical insecticide. The grain in question had been found to be 'contaminated,' although not due to the fault or with the knowledge of the city or the shipowner, and the question before this Court was whether the longshoreman could recover for unseaworthiness. The Court sustained the conclusion of the lower courts that he could not, because under the circumstances the absence of a forced ventilation system in the hold did not constitute unseaworthiness.
25
'What caused injury in the present case, however, was not the ship, its appurtenances, or its crew, but the isolated and completely unforeseeable introduction of a noxious agent from without. The trier of the facts ruled, under proper criteria, that the Grelmarion (the ship) was not in any manner unfit for the service to which she was to be put, and we cannot say that his determination was wrong.' 370 U.S., at 171, 82 S.Ct., at 1230.
26
The crucial point for present purposes is that both the majority and the dissenting opinions in Morales viewed the issue in terms of the seaworthiness of the ship: whether or not it should have had a forced ventilation system in the hold. Nowhere was it even suggested that liability for unseaworthiness could arise solely by virtue of the defective state of the cargo itself, even though its contaminated and unsafe condition had clearly been established and was not in dispute. Thus the Court in Morales unanimously ignored the possibility of a doctrine which the Court today concludes was squarely established less than three months earlier, in Ellerman.4
II.
27
In order to conclude that the respondent shipowner was negligent in the circumstances presented here, it was necessary for the trier of fact to find that the respondent knew or should have known of the defective condition of the bags being unloaded. It is doubtful that such a finding was made by the trial judge in this case—the closest he came was the statement that the shipowner was negligent in permitting broken and weakened bags to be discharged 'when it knew or should have known that injury was likely to result.' This finding passes over the basic question: whether respondent had notice, or constructive notice, of the condition of the bags themselves.
28
Even assuming for present purposes that the necessary finding as to notice was made, I believe that the judgment on negligence cannot be sustained, for there is no evidence whatever to support such a finding. The evidence in the record, including the landing report, relates only to the stevedore company's knowledge of the condition of the bags. There is nothing to suggest that any agent or employee of the respondent was or should have been in the area, or knew or should have known of the condition of the cargo at the time of unloading.5 And of course there is no basis in law for charging the shipowner with responsibility for any negligence on the part of the stevedore company.
29
Whether from the standpoint of negligence or unseaworthiness I see no basis for the holding in this case. Presumably the result reached by the Court would be the same—at least consistency demands that it should be the same—if this accident had occurred on the dock while the beans were being loaded rather than unloaded. Yet in neither case is there warrant for holding the shipowner to have breached any obligation, for in neither case does it own or control the place where the accident occurred and in neither case is the ship's equipment, property, or crew in any way responsible, with or without fault, for the injury.
30
Accordingly, I would affirm.
1
Petitioner's injury was covered by the Puerto Rico Workmen's Compensation Act, under which suits must be instituted within a year following the date of the final decision in the case by the Manager of the State Insurance Fund. Puerto Rico Laws Ann. § 11:32.
2
The stevedore was Waterman Dock Company, a wholly owned subsidiary of respondent Waterman Steamship Company.
3
The question of whether the warranty of seaworthiness extends to longshoremen on the dock is considered, infra, at p. 213-214.
4
The Ellerman case was cited with approval in the later decision, Morales v. City of Galveston, 370 U.S. 165, 170, 82 S.Ct. 1226, 1229, and the majority of the Court in Morales, with one exception, joins the majority here. Morales, of course, did not involve the unseaworthiness of cargo containers, but rather that of a ship's hold.
5
But see Carabellese v. Naviera Aznar, S.A., 285 F.2d 355 (C.A.2d Cir.) (top-heavy crate of machinery).
6
We note that respondent admits in its brief that 'petitioner's witnesses were available * * *, that the payroll records of the stevedore indicated the potential eyewitnesses, that the accident report filed by the stevedore named the witnesses and formed part of the record of the State Insurance Fund, that respondent produced evidence indicating the cargo damaged prior to and at the time of the discharge, that medical records indicating treatment and the names of the treating physicians were available, and that the respondent took petitioner's deposition and submitted interrogatories * * *.' Moreover, the record indicates that respondent never bothered to interview the petitioner's witnesses Roman or Cintron before trial, despite the fact that petitioner's answers to interrogatories named them. And respondent does not contradict petitioner's contention that respondent chose not to interview any of the witnesses even though it had their names through discovery. In such circumstances it is hardly appropriate for respondent to claim prejudice for want of an opportunity to interview the witnesses sooner. In this connection it should be noted that the accident occurred October 21, 1956; the analogous statute of limitations ran out November 30, 1957; the libel was filed January 9, 1959; trial began March 21, 1960—so that as much time elapsed between filing the action and trial, when respondent failed to interview the witnesses, as elapsed during the period of alleged laches.
1
A 6—3 unexplicated per curiam.
2
The result in Reddick v. McAllister Lighterage Line, 2 Cir., 258 F.2d 297, the only other Court of Appeals case cited by the majority, is consistent with these decisions, for all three judges in Reddick agreed that the finding of unseaworthiness could be sustained on the basis of improper stowage. Two of the judges said, but only alternatively, that the finding could 'also be predicated on the latent defect in the cargo-crate.' 258 F.2d at 299. (Emphasis added.)
3
I do not attach significance to the fact that in Ellerman the Court was asked in a petition for rehearing to reconsider whether cargo can itself be unseaworthy. Petitioners for rehearing lie within the broad discretion of the Court and are almost never granted. Indeed, this petition for rehearing serves principally to underscore the fact that the point had not been briefed, argued, or apparently even considered by the parties as germane to the case prior to its decision.
4
The Court in Morales cited Ellerman, along with several other cases, only for the proposition that a ship might be unseaworthy because '(t)he method of loading her cargo, or the manner of its stowage, might be improper.' 370 U.S., at 170, 82 S.Ct., at 1230. Such a proposition, of course, is wholly different from the one for which Ellerman is cited today.
5
The coopers sent aboard were employed by the stevedore company, not the steamship company.
| 78
|
373 U.S. 193
83 S.Ct. 1168
10 L.Ed.2d 288
A. J. WHIPPLE et al., Petitioners,v.COMMISSIONER OF INTERNAL REVENUE.
No. 305.
Argued March 26, 27, 1963.
Decided May 13, 1963.
Rehearing Denied June 17, 1963.
See 374 U.S. 858, 83 S.Ct. 1863.
Charles Dillingham, Houston, Tex., for petitioners.
Solicitor Gen., Archibald Cox, Washington, D.C., for respondent.
Mr. Justice WHITE delivered the opinion of the Court.
1
Section 23(k)(1) of the Internal Revenue Code of 19391 provides for the deduction in full of worthless debts other than nonbusiness bad debts while § 23(k)(4) restricts nonbusiness bad debts to the treatment accorded losses on the sale of short-term capital assets.2 The statute defines a nonbusiness bad debt in part as 'a debt * * * other than a debt the loss from the worthlessness of which is incurred in the taxpayer's trade or business.' § 23(k)(4). The question before us is whether petitioner's activities in connection with several corporations in which he holds controlling interests can themselves be characterized as a trade or business so as to permit a debt owed by one of the corporations to him to be treated within the general rule of § 23(k)(1) as a 'business' rather than a 'nonbusiness' bad debt.
2
Prior to 1941 petitioner was a construction superintendent and an estimator for a lumber company but during that year and over the next several ones he was instrumental in forming and was a member of a series of partnerships engaged in the construction or construction supply business. In 1949 and 1950 he was an original incorporator of seven corporations, some of which were successors to the partnerships, and in 1951 he sold his interest in the corporations along with his equity in five others in the rental and construction business, the profit on the sales being reported as long-term capital gains. In 1951 and 1952 he formed eight new corporations, one of which was Mission Orange Bottling Co. of Lubbock, Inc., bought the stock of a corporation known as Mason Root Beer3 and acquired an interest in a related vending machine business. From 1951 to 1953 he also bought and sold land, acquired and disposed of a restaurant and participated in several oil ventures.
3
On April 25, 1951, petitioner secured a franchise from Mission Dry Corporation entitling him to produce, bottle, distribute and sell Mission beverages in various counties in Texas. Two days later he purchased the assets of a soleproprietorship in the bottling business and conducted that business pursuant to his franchise as a sole proprietorship. On July 1, 1951, though retaining the franchise in his own name, he sold the bottling equipment to Mission Orange Bottling Co. of Lubbock, Inc., a corporation organized by petitioner as mentioned, of which he owned approximately 80% of the shares outstanding.4 In 1952 he purchased land in Lubbock and erected a bottling plant thereon at a cost of $43,601 and then leased the plant to Mission Orange for a 10-year term at a prescribed rental. Depreciation was taken on the new bottling plant on petitioner's individual tax returns for 1952 and 1953.
4
Petitioner made sizable cash advances to Mission Orange in 1952 and 1953, and on December 1, 1953, the balance due him, including $25,502.50 still owing from his sale of the bottling assets to the corporation in July 1951, totaled $79,489.76. On December 15, 1953, petitioner advanced to Mission Orange an additional $48,000 to pay general creditors and on the same day received a transfer of the assets of the corporation with a book value of $70,414.66. The net amount owing to petitioner ultimately totaled $56,975.10, which debt became worthless in 1953 and is in issue here. During 1951, 1952 and 1953 Mission Orange made no payments of interest, rent or salary to petitioner although he did receive such income from some of his other corporations.5
5
Petitioner deducted the $56,975.10 debt due from Mission Orange as a business bad debt in computing his 1953 taxable income. The Commissioner, claiming the debt was a nonbusiness bad debt, assessed deficiencies. The Tax Court, after determining that petitioner in 1953 was not in the business of organizing, promoting, managing or financing corporations, of bottling soft drinks or of general financing and money lending, sustained the deficiencies. A divided Court of Appeals affirmed, 5 Cir., 301 F.2d 108, and upon a claim of conflict6 among the Courts of Appeals, we granted certiorari. 371 U.S. 875, 83 S.Ct. 146, 9 L.Ed.2d 113.
I.
6
The concept of engaging in a trade or business as distinguished from other activities pursued for profit is not new to the tax laws. As early as 1916, Congress, by providing for the deduction of losses incurred in a trade or business separately from those sustained in other transactions entered into for profit, § 5, Revenue Act of 1916, c. 463, 39 Stat. 756, distinguished the broad range of income or profit producing activities from those satisfying the narrow category of trade or business. This pattern has been followed elsewhere in the Code. See, e.g., § 23(a)(1) and (2) (ordinary and necessary expenses); § 23(e) (1) and (2) (losses); § 23(l)(1) and (2) (depreciation); § 122(d)(5) (net operating loss deduction). It is not surprising, therefore, that we approach the problem of applying that term here with much writing upon the slate.
7
In Burnet v. Clark, 287 U.S. 410, 53 S.Ct. 207, 77 L.Ed. 397 (1932), the long-time president and principal stockholder of a corporation in the dredging business endorsed notes for the company which he was forced to pay. These amounts were deductible by him in the current year under the then existing law, but to carry over the loss to later years it was necessary for it to have resulted from the operation of a trade or business regularly carried on by the taxpayer. The Board of Tax Appeals denied the carry-over but the Court of Appeals for the District of Columbia held otherwise on the grounds that the taxpayer devoted all of his time and energies to carrying on the business of dredging and that he was compelled by circumstances to endorse the company's notes in order to supply it with operating funds.7 This Court in turn reversed and reinstated the judgment of the Board of Tax Appeals, since '(t)he respondent was employed as an officer of the corporation; the business which he conducted for it was not his own. * * * The unfortunate endorsements were no part of his ordinary business, but occasional transactions intended to preserve the value of his investment in capital shares. * * * A corporation and its stockholders are generally to be treated as separate entities.' A similar case, Dalton v. Bowers, 287 U.S. 404, 53 S.Ct. 205, 77 L.Ed. 389, decided the same day, applied the same principles.8
8
A few years later the same problem arose in another context. A taxpayer with large and diversified investment holdings, including a substantial but not controlling interest in the du Pont Company, obtained a block of stock of that corporation for distribution to its officers in order to increase their management efficiency. The taxpayer, as a result, became obligated to refund the annual dividends and taxes thereon and these amounts he sought to deduct as ordinary and necessary expenses paid or incurred in the carrying on of a trade or business pursuant to § 23(a) of the Revenue Act of 1928. The Court, Deputy v. du Pont, 308 U.S. 488, 60 S.Ct. 363, 84 L.Ed. 416 (1940), assuming arguendo that the taxpayer's activities in investing and managing his estate were a trade or business, nevertheless denied the deduction because the transactions 'had their origin in an effort by that company to increase the efficiency of its management' and 'arose out of transactions which were intended to preserve his investment in the corporation * * *. The well established decisions of this Court do not permit any such blending of the corporation's business with the business of its stockholders.' 308 U.S., at 494, 60 S.Ct., at 366, 84 L.Ed. 416. Reliance was placed upon Burnet v. Clark and Dalton v. Bowers, supra.
9
The question assumed in du Pont was squarely up for decision in Higgins v. Commissioner, 312 U.S. 212, 61 S.Ct. 475, 85 L.Ed. 783 (1941). Here the taxpayer devoted his time and energies to managing a sizable portfolio of securities and sought to deduct his expenses incident thereto as incurred in a trade or business under § 23(a). The Board of Tax Appeals, the Court of Appeals for the Second Circuit and this Court held that the evidence was insufficient to establish taxpayer's activities as those of carrying on a trade or business. 'The petitioner merely kept records and collected interest and dividends from his securities, through managerial attention for his investments. No matter how large the estate or how continuous or extended the work required may be, such facts are not sufficient as a matter of law to permit the courts to reverse the decision of the Board.' 312 U.S., at 218, 61 S.Ct., at 478, 85 L.Ed. 783.
10
Such was the state of the cases in this Court when Congress, in 1942, amended the Internal Revenue Code in respects crucial to this case. In response to the Higgins case and to give relief to Higgins type taxpayers, see H.R.Rep. No. 2333, 77th Cong., 2d Sess. 46, § 23(a) was amended not by disturbing the Court's definition of 'trade or business' but by following the pattern that had been established since 1916 of '(enlarging) the category of incomes with reference to which expenses were deductible,' McDonald v. Commissioner, 323 U.S. 57, 62, 65 S.Ct. 96, 98, 89 L.Ed. 68; United States v. Gilmore, 372 U.S. 39, 45, 83 S.Ct. 623, 627, 9 L.Ed.2d 570, to include expenses incurred in the production of income.
11
At the same time, to remedy what it deemed the abuses of permitting any worthless debt to be fully deducted, as was the case prior to this time, see H.R.Rep. No. 2333, 77th Cong., 2d Sess. 45, Congress restricted the full deduction under § 23(k) to bad debts incurred in the taxpayer's trade or business9 and provided that 'nonbusiness' bad debts were to be deducted as short-term capital losses. Congress deliberately used the words 'trade or business,' terminology familiar to the tax laws, and the respective committees made it clear that the test of whether a debt is incurred in a trade or business 'is substantially the same as that which is made for the purpose of ascertaining whether a loss from the type of transaction covered by section 23(e) is 'incurred in trade or business' under paragraph (1) of that section.' H.R.Rep.No. 2333, 77th Cong., 2d Sess. 76—77; S.Rep.No. 1631, 77th Cong., 2d Sess. 90. Section 23(e)(1), of course, was a successor to the old § 5 of the Revenue Act of 1916 under which it had long been the rule to distinguish between activities in a trade or business and those undertaken for profit. The upshot was that Congress broadened § 23(a) to reach income producing activities not amounting to a trade or business and conversely narrowed § 23(k) to exclude bad debts arising from these same sources.
12
The 1942 amendment of § 23(k), therefore, as the Court has already noted, Putnam v. Commission, 352 U.S. 82, 90—92, 77 S.Ct. 175, 179—180, 1 L.Ed.2d 144, was intended to accomplish far more than to deny full deductibility to the worthless debts of family and friends. It was designed to make full deductibility of a bad debt turn upon its proximate connection with activities which the tax laws recognized as a trade or business, a concept which falls far short of reaching every income or profit making activity.
II.
13
Petitioner, therefore, must demonstrate that he is engaged in a trade or business, and lying at the heart of his claim is the issue upon which the lower courts have divided and which brought the case here: That where a taxpayer furnishes regular services to one or many corporations, an independent trade or business of the taxpayer has been shown. But against the background of the 1942 amendments and the decisions of this Court in the Dalton, Burnet, du Pont and Higgins cases, petitioner's claim must be rejected.
14
Devoting one's time and energies to the affairs of a corporation is not of itself, and without more, a trade or business of the person so engaged. Though such activities may produce income, profit or gain in the form of dividends or enhancement in the value of an investment, this return is distinctive to the process of investing and is generated by the successful operation of the corporation's business as distinguished from the trade or business of the taxpayer himself. When the only return is that of an investor, the taxpayer has not satisfied his burden of demonstrating that he is engaged in a trade or business since investing is not a trade or business and the return to the taxpayer, though substantially the product of his services, legally arises not from his own trade or business but from that of the corporation. Even if the taxpayer demonstrates an independent trade or business of his own, care must be taken to distinguish bad debt losses arising from his own business and those actually arising from activities peculiar to an investor concerned with, and participating in, the conduct of the corporate business.
15
If full-time service to one corporation does not alone amount to a trade or business, which it does not, it is difficult to understand how the same service to many corporations would suffice. To be sure, the presence of more than one corporation might lend support to a finding that the taxpayer was engaged in a regular course of promoting corporations for a fee or commission, see Ballantine, Corporations (rev. ed. 1946), 102, or for a profit on their sale, see Giblin v. Commissioner, 227 F.2d 692 (C.A.5th Cir.), but in such cases there is compensation other than the normal investor's return, income received directly for his own services rather than indirectly through the corporate enterprise, and the principles of Burnet, Dalton, du Pont and Higgins are therefore not offended. On the other hand, since the Tax Court found, and the petitioner does not dispute, that there was no intention here of developing the corporations as going businesses for sale to customers in the ordinary course, the case before us inexorably rests upon the claim that one who actively engages in serving his own corporations for the purpose of creating future income through those enterprises is in a trade or business. That argument is untenable in light of Burnet, Dalton, du Pont and Higgins, and we reject it.10 Absent substantial additional evidence,11 furnishing management and other services to corporations for a reward not different from that flowing to an investor in those corporations is not a trade or business under § 23(k)(4). We are, therefore, fully in agreement with this aspect of the decision below.
III.
16
With respect to the other claims by petitioner, we are unwilling to disturb the determinations of the Tax Court, affirmed by the Court of Appeals, that petitioner was not engaged in the business of money lending, of financing corporations, of bottling soft drinks or of any combination of these since we cannot say they are clearly erroneous. See Commissioner of Internal Revenue v. Duberstein, 363 U.S. 278, 289 291, 80 S.Ct. 1190, 1198—1200, 4 L.Ed.2d 1218. Nor need we consider or deal with those cases which hold that working as a corporate executive for a salary may be a trade or business. E.g., Trent v. Commissioner, 291 F.2d 669 (C.A.2d Cir.).12 Petitioner made no such claim in either the Tax Court or the Court of Appeals and, in any event, the contention would be groundless on this record since it was not shown that he has collected a salary from Mission Orange or that he was owed one. Moreover, there is no proof (which might be difficult to furnish where the taxpayer is the sole or dominant stockholder) that then loan was necessary to keep his job or was otherwise proximately related to maintaining his trade or business as an employee. Compare Trent v. Commissioner, supra.
17
We are more concerned, however, with the evidence as to petitioner's position as the owner and lessor of the real estate and bottling plant in which Mission Orange did business. The United States does not dispute the fact that in this regard petitioner was engaged in a trade or business13 but argues that the loss from the worthless debt was not proximately related to petitioner's real estate business. While the Tax Court and the Court of Appeals dealt separately with assertions relating to other phases of petitioner's case, we do not find that either court disposed of the possibility that the loan to Mission Orange, a tenant of petitioner, was incurred in petitioner's business of being a landlord. We take no position whatsoever on the merits of this matter but remand the case for further proceedings in the Tax Court.
18
Vacated and remanded.
19
Mr. Justice DOUGLAS dissents.
1
The 1954 Code provision, § 166, is substantially identical to that in the 1939 Code with respect to the problem here. Preceding the enactment of the 1954 Code, there were statements from witnesses urging an express provision for the full bad debt deduction in circumstances such as these to overturn contrary lower court decisions like Commissioner of Internal Revenue v. Smith, 203 F.2d 310 (C.A.2d Cir.), Hearings before the House Committee on Ways and Means on Forty Topics Pertaining to the General Revision of the Internal Revenue Code, 83d Cong., 1st Sess. (pt. 3), 1519—1525, and bills introduced for that purpose, H.R. 3165 and H.R. 4853, 83d Cong., 1st Sess. The provision finally enacted, however, was one without these suggested modifications.
2
In general, short-term capital losses are deductible only to the extent of the gains from the sale or exchange of capital assets, plus the taxable income of the taxpayer or $1,000, whichever is smaller. § 117(d)(2). See also § 1211(b), 1954 Code.
3
This corporation owned a franchise to distribute Mason root beer which petitioner bottled at the Mission Orange plant in Lubbock. Mason Root Beer failed in 1953 and petitioner's return for that year, the same one as involved in this suit, reflects a $3,300 loss on the stock and a $53.33 nonbusiness bad debt from that corporation.
4
At the time Mission Orange was organized petitioner was issued 88% of the outstanding shares. The charter was amended in December of 1952 to authorize additional capital stock which, when subsequently issued, reduced his interest in the corporation to 77%. Sometime before the end of 1953, petitioner increased his holdings to about 79.5% of the outstanding shares.
5
He collected interest totaling $1,680.15 in 1951, $2,285.35 in 1952 and $1,747.59 in 1953; rental income of $15,570.78 in 1952 and $12,225.19 in 1953; and salaries totaling $29,400 for 1952 and $33,450 for 1953.
6
See note 10, infra.
7
The lower court relied in part upon the test of trade or business announced in Wasburn v. Commissioner, 8 Cir., 51 F.2d 949, 953:
'A party may have investments in corporate stock, have no particular occupation, and live on the return of his investments. That would not constitute business under the statute in question. He may, however, take such an active part in the management of the enterprise in which he has investments as to amount to the carrying on of a business.'
8
Dalton v. Bowers involved a taxpayer, owning all the stock of the debtor corporation, who argued that his trade or business was carrying on a comprehensive enterprise of exploiting his own inventions through corporations organized for limited purposes and that these personal activities transcended the separate corporate entities. As in Burnet, however, these contentions were rejected.
'He treated (his corporation) as something apart from his ordinary affairs, accepted credits for salaries as an officer, claimed loss to himself because of loans to it which had become worthless, and caused it to make returns for taxation distinct from his own. Nothing indicates that he regarded the corporation as his agent with authority to contract or act in his behalf. Ownership of all the stock is not enough to show that creation and management of the corporation was a part of his ordinary business. Certainly, under the general rule for tax purposes, a corporation is an entity distinct from its stockholders * * *.' 287 U.S., at 410, 53 S.Ct., at 206, 77 L.Ed. 389.
9
'The character of the debt for this purpose is not controlled by the circumstances attending its creation or its subsequent acquisition by the taxpayer or by the use to which the borrowed funds are put by the recipient, but is to be determined rather by the relation which the loss resulting from the debt's becoming worthless bears to the trade or business of the taxpayer. If that relation is a proximate one in the conduct of the trade or business in which the taxpayer is engaged at the time the debt becomes worthless, the debt is not a nonbusiness debt for the purposes of this amendment.' H.R.Rep. No. 2333, 77th Cong., 2d Sess. 77; S.Rep. No. 1631, 77th Cong., 2d Sess. 90. Treasury Regulations 118, § 39.23(k)—6(b), adopts substantially this language of the Committee Reports as the test to be applied under § 23(k).
10
To the extent that they hold or contain statements to the contrary, we disapprove of such cases as Maytag v. United States, 153 Ct.Cl. 622, 289 F.2d 647 (Ct.Cl.); Mays v. Commissioner, 272 F.2d 788 (C.A.6th Cir.); Commissioner v. Stokes' Estate, 200 F.2d 637 (C.A.3d Cir.); Foss v. Commissioner, 75 F.2d 326 (C.A.1st Cir.); Washburn v. Commissioner, 51 F.2d 949 (C.A.8th Cir.); Sage v. Commissioner, 15 T.C. 299; Campbell v. Commissioner, 11 T.C. 510; and Cluett v. Commissioner, 8 T.C. 1178.
11
Compare Maloney v. Spencer, 172 F.2d 638 (C.A.9th Cir.), and Dorminey v. Commissioner, 26 T.C. 940.
12
See under § 122 (net operating loss carry-over) Folker v. Johnson, 230 F.2d 906 (C.A.2d Cir.); Overly v. Commissioner, 243 F.2d 576 (C.A.3d Cir.); Batzell v. Commissioner, 266 F.2d 371 (C.A.4th Cir.); Roberts v. Commissioner, 258 F.2d 634 (C.A.5th Cir.); Pierce v. United States, 254 F.2d 885 (C.A.9th Cir.). But cf., McGinn v. Commissioner, 76 F.2d 680, 99 A.L.R. 564 (C.A.9th Cir.); Hughes v. Commissioner, 38 F.2d 755 (C.A.10th Cir.). See under § 23(a) (1) (ordinary and necessary expenses of trade or business) Schmidlapp v. Commissioner, 96 F.2d 680, 118 A.L.R. 297 (C.A.2d Cir.); Noland v. Commissioner, 269 F.2d 108, 111 (C.A.4th Cir.).
13
Although petitioner received no rental payments from Mission Orange, there was rent owing to him under the 10-year-lease-agreement.
| 1112
|
373 U.S. 221
83 S.Ct. 1139
10 L.Ed.2d 308
NATIONAL LABOR RELATIONS BOARD, Petitioner,v.ERIE RESISTOR CORPORATION et al.
No. 288.
Argued Feb. 18 and 19, 1963.
Decided May 13, 1963.
Norton J. Come, Washington, D.C., for petitioner.
John G. Wayman, Pittsburgh, Pa., for respondents.
Mr. Justice WHITE delivered the opinion of the Court.
1
The question before us is whether an employer commits an unfair labor practice under § 8(a)1 of the National Labor Relations Act, 61 Stat. 136, 29 U.S.C. § 158, when he extends a 20-year seniority credit to strike replacements and strikers who leave the strike and return to work. The Court of Appeals for the Third Circuit in this case joined the Ninth Circuit, National Labor Relations Board v. Potlatch Forests, Inc., 189 F.2d 82 (and see National Labor Relations Board v. Lewin-Mathes Co., 285 F.2d 329, from the Seventh Circuit), to hold that such super-seniority awards are not unlawful absent a showing of an illegal motive on the part of the employer. 303 F.2d 359. The Sixth Circuit, Swarco, Inc., v. National Labor Relations Board, 303 F.2d 668, and the National Labor Relations Board are of the opinion that such conduct can be unlawful even when the employer asserts that these additional benefits are necessary to continue his operations during a strike. To resolve these conflicting views upon an important question in the administration of the National Labor Relations Act, we brought the case here. 371 U.S. 810, 83 S.Ct. 48, 9 L.Ed.2d 53.
2
Erie Resistor Corporation and Local 613 of the International Union of Electrical Radio and Machine Workers were bound by a collective bargaining agreement which was due to expire on March 31, 1959. In January 1959, both parties met to negotiate new terms but, after extensive bargaining, they were unable to reach agreement. Upon expiration of the contract, the union, in support of its contract demands, called a strike which was joined by all of the 478 employees in the unit.2
3
The company, under intense competition and subject to insistent demands from its customers to maintain deliveries, decided to continue production operations. Transferring clerks, engineers and other nonunit employees to production jobs, the company managed to keep production at about 15% to 30% of normal during the month of April. On May 3, however, the company notified the union members that it intended to begin hiring replacements and that strikers would retain their jobs until replaced. The plant was located in an area classified by the United States Department of Labor as one of severe unemployment and the company had in fact received applications for employment as early as a week or two after the strike began.
4
Replacements were told that they would not be laid off or discharged at the end of the strike. To implement that assurance, particularly in view of the 450 employees already laid off on March 31, the company notified the union that it intended to accord the replacements some form of super-seniority. At regular bargaining sessions between the company and union, the union made it clear that, in its view, no matter what form the super-seniority plan might take, it would necessarily work an illegal discrimination against the strikers. As negotiations advanced on other issues, it became evident that super-seniority was fast becoming the focal point of disagreement. On May 28, the company informed the union that it had decided to award 20 years'3 additional seniority both to replacements and to strikers who returned to work, which would be available only for credit against future layoffs and which could not be used for other employee benefits based on years of service. The strikers, at a union meeting the next day, unanimously resolved to continue striking now in protest against the proposed plan as well.
5
The company made its first official announcement of the super-seniority plan on June 10, and by June 14, 34 new employees, 47 employees recalled from layoff status and 23 returning strikers had accepted production jobs. The union, now under great pressure, offered to give up some of its contract demands if the company would abandon super-seniority or go to arbitration on the question, but the company refused. In the following week, 64 strikers returned to work and 21 replacements took jobs, bringing the total to 102 replacements and recalled workers and 87 returned strikers. When the number of returning strikers went up to 125 during the following week, the union capitulated. A new labor agreement on the remaining economic issues was executed on July 17, and an accompanying settlement agreement was signed providing that the company's replacement and job assurance policy should be resolved by the National Labor Relations Board and the federal courts but was to remain in effect pending final disposition.
6
Following the strike's termination, the company reinstated those strikers whose jobs had not been filled (all but 129 were returned to their jobs). At about the same time, the union received some 173 resignations from membership. By September of 1959, the production unit work force had reached a high of 442 employees, but by May of 1960, the work force had gradually slipped back to 240. Many employees laid off during this cut back period were reinstated strikers whose seniority was insufficient to retain their jobs as a consequence of the company's super-seniority policy.
7
The union filed a charge with the National Labor Relations Board alleging that awarding super-seniority during the course of the strike constituted an unfair labor practice and that the subsequent layoff of the recalled strikers pursuant to such a plan was unlawful. The Trial Examiner found that the policy was promulgated for legitimate economic reasons,4 not for illegal or discriminatory purposes, and recommended that the union's complaint be dismissed. The Board could not agree with the Trial Examiner's conclusion that specific evidence of subjective intent to discriminate against the union was necessary to finding that super-seniority granted during a strike is an unfair labor practice. Its consistent view, the Board said, had always been that super-seniority, in circumstances such as these, was an unfair labor practice. The Board rejected the argument that super-seniority granted during a strike is a legitimate corollary of the employer's right of replacement under National Labor Relations Board v. Mackay Radio & Tel. Co., 304 U.S. 333, 58 S.Ct. 904, 82 L.Ed. 1381, and detailed at some length the factors which to it indicated that 'superseniority is a form of discrimination extending far beyond the employer's right of replacement sanctioned by Mackay, and is, moreover, in direct conflict with the express provisions of the Act prohibiting discrimination.' Having put aside Mackay, the Board went on to deny 'that specific evidence of Respondent's discriminatory motivation is required to establish the alleged violations of the Act,' relying upon Radio Officers Union of Commercial Telegraphers Union, A.F.L. v. National Labor Relations Board, 347 U.S. 17, 74 S.Ct. 323, 98 L.Ed. 455; Republic Aviation Corp. v. National Labor Relations Board, 324 U.S. 793, 65 S.Ct. 982, 89 L.Ed. 1372, and Local 357, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America v. National Labor Relations Board, 365 U.S. 667, 81 S.Ct. 835, 6 L.Ed.2d 11. Moreover, in the Board's judgment, the employer's insistence that its overriding purpose in granting super-seniority was to keep its plant open and that business necessity justified its conduct was unacceptable since 'to excuse such conduct would greatly diminish, if not destroy, the right to strike guaranteed by the Act, and would run directly counter to the guarantees of Sections 8(a)(1) and (3) that employees shall not be discriminated against for engaging in protected concerted activities.'5 Accordingly, the Board declined to make findings as to the specific motivation of the plan or its business necessity in the circumstances here.
8
The Court of Appeals rejected as unsupportable the rationale of the Board that a preferential seniority policy is illegal however motivated.
9
'We are of the opinion that inherent in the right of an employer to replace strikers during a strike is the concomitant right to adopt a preferential seniority policy which will assure the replacements some form of tenure, provided the policy is adopted SOLELY to protect and continue the business of the employer. We find nothing in the Act which proscribes such a policy. Whether the policy adopted by the Company in the instant case was illegally motivated we do not decide. The question is one of fact for decision by the Board.' 303 F.2d, at 364.
10
It consequently denied the Board's petition for enforcement and remanded the case for further findings.
11
We think the Court of Appeals erred in hold that, in the absence of a finding of specific illegal intent, a legitimate business purpose is always a defense to an unfair labor practice charge. Cases in this Court dealing with unfair labor practices have recognized the relevance and importance of showing the employer's intent or motive to discriminate or to interfere with union rights. But specific evidence of such subjective intent is 'not an indispensable element of proof of violation.' Radio Officers Union of Commercial Telegraphers Union,A.F.L. v. National Labor Relations Board, 347 U.S. 17, 44, 74 S.Ct. 323, 98 L.Ed. 455. 'Some conduct may by its very nature contain the implications of the required intent; the natural foreseeable consequences of certain action may warrant the inference. * * * The existence of discrimination may at times be inferred by the Board, for 'it is permissible to draw on experience in factual inquiries." Local 357, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America v. National Labor Relations Board, 365 U.S. 667, 675, 81 S.Ct. 835, 839, 6 L.Ed.2d 11.
12
Though the intent necessary for an unfair labor practice may be shown in different ways, proving it in one manner may have far different weight and far different consequences than proving it in another. When specific evidence of a subjective intent to discriminate or to encourage or discourage union membership is shown, and found, many otherwise innocent or ambiguous actions which are normally incident to the conduct of a business may, without more, be converted into unfair labor practices. National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U.S. 1, 46, 57 S.Ct. 615, 628, 81 L.Ed. 893 (discharging employees); Associated Press v. National Labor Relations Board, 301 U.S. 103, 132, 57 S.Ct. 650, 655, 81 L.Ed. 953 (discharging employees); Phelps Dodge Corp. v. National Labor Relations Board, 313 U.S. 177, 61 S.Ct. 845, 85 L.Ed. 1271 (hiring employees). Compare National Labor Relations Board v. Brown-Dunkin Co., 10 Cir., 287 F.2d 17, with National Labor Relations Board v. Houston Chronicle Publishing Co., 5 Cir., 211 F.2d 848 (subcontracting union work); and Fiss Corp., 43 N.L.R.B. 125, with Jacob H. Klotz, 13 N.L.R.B. 746 (movement of plant to another town). Such proof itself is normally sufficient to destroy the employer's claim of a legitimate business purpose, if one is made, and provides strong support to a finding that there is interference with union rights or that union membership will be discouraged. Conduct which on its face appears to serve legitimate business ends in these cases is wholly impeached by the showing of an intent to encroach upon protected rights. The employer's claim of legitimacy is totally dispelled.6
13
The outcome may well be the same when intent is founded upon the inherently discriminatory or destructive nature of the conduct itself. The employer in such cases must be held to intend the very consequences which foreseeably and inescapably flow from his actions and if he fails to explain away, to justify or to characterize his actions as something different than they appear on their face, an unfair labor practice charge is made out. Radio Officers Union of Commercial Telegraphers Union, A.F.L. v. National Labor Relations Board, supra. But, as often happens, the employer may counter by claiming that his actions were taken in the pursuit of legitimate business ends and that his dominant purpose was not to discriminate or to invade union rights but to accomplish business objectives acceptable under the Act. Nevertheless, his conduct does speak for itself—it is discriminatory and it does discourage union membership and whatever the claimed overriding justification may be, it carries with it unavoidable consequences which the employer not only foresaw but which he must have intended. As is not uncommon in human experience, such situations present a complex of motives and preferring one motive to another is in reality the far more delicate task, reflected in part in decisions of this Court,7 of weighing the interests of employees in concerted activity against the interest of the employer in operating his business in a particular manner and of balancing in the light of the Act and its policy the intended consequences upon employee rights against the business ends to be served by the employer's conduct.8 This essentially is the teaching of the Court's prior cases dealing with this problem and, in our view, the Board did not depart from it.
14
The Board made a detailed assessment of super-seniority and, it its experienced eye, such a plan had the following characteristics:
15
(1) Super-seniority affects the tenure of all strikers whereas permanent replacement, proper under Mackay, affects only those who are, in actuality, replaced. It is one thing to say that a striker is subject to loss of his job at the strike's end but quite another to hold that in addition to the threat of replacement, all strikers will at best return to their jobs with seniority inferior to that of the replacements and of those who left the strike.
16
(2) A super-seniority award necessarily operates to the detriment of those who participated in the strike as compared to nonstrikers.
17
(3) Super-seniority made available to striking bargaining unit employees as well as to new employees is in effect offering individual benefits to the strikers to induce them to abandon the strike.
18
(4) Extending the benedfits of super-seniority to striking bargaining unit employees as well as to new replacements deals a crippling blow to the strike effort. At one stroke, those with low seniority have the opportunity to obtain the job security which ordinarily only long years of service can bring, while conversely, the accumulated seniority of older employees is seriously diluted. This combination of threat and promise could be expected to undermine the strikers' mutual interest and place the entire strike effort in jeopardy. The history of this strike and its virtual collapse following the announcement of the plan emphasize the grave repercussions of super-seniority.
19
(5) Super-seniority renders future bargaining difficult, if not impossible, for the collective bargaining representative. Unlike the replacement granted in Mackay which ceases to be an issue once the strike is over, the plan here creates a cleavage in the plant continuing long after the strike is ended. Employees are henceforth divided into two camps: those who stayed with the union and those who returned before the end of the strike and thereby gained extra seniority. This breach is reemphasized with each subsequent layoff and stands as an ever-present reminder of the dangers connected with striking and with union activities in general.
20
In the light of this analysis, super-seniority by its very terms operates to discriminate between strikers and non-strikers, both during and after a strike, and its destructive impact upon the strike and union activity cannot be doubted. The origin of the plan, as respondent insists, may have been to keep production going and it may have been necessary to offer super-seniority to attact replacements and induce union members to leave the strike. But if this is true, accomplishment of respondent's business purpose inexorably was contingent upon attracting sufficient replacements and strikers by offering preferential inducements to those who worked as opposed to those who struck. We think the Board was entitled to treat this case as involving conduct which carried its own indicia of intent and which is barred by the Act unless saved from illegality by an overriding business purpose justifying the invasion of union rights. The Board concluded that the business purpose asserted was insufficient to insulate the super-seniority plan from the reach of § 8(a)(1) and § 8(a)(3), and we turn now to a review of that conclusion.
21
The Court of Appeals and respondent rely upon Mackay as precluding the result reached by the Board but we are not persuaded. Under the decision in that case an employer may operate his plant during a strike and at its conclusion need not discharge those who worked during the strike in order to make way for returning strikers. It may be, as the Court of Appeals said, that 'such a replacement policy is obviously discriminatory and may tend to discourage union membership.' But Mackay did not deal with super-seniority, with its effects upon all strikers, whether replaced or not, or with its powerful impact upon a strike itself. Because the employer's interest must be deemed to outweigh the damage to concerted activities caused by permanently replacing strikers does not mean it also outweighs the far greater encroachment resulting from super-seniority in addition to permanent replacement.
22
We have no intention of questioning the continuing vitality of the Mackay rule, but we are not prepared to extend it to the situation we have here. To do so would require us to set aside the Board's considered judgment that the Act and its underlying policy require, in the present context, giving more weight to the harm wrought by super-seniority than to the interest of the employer in operating its plant during the strike by utilizing this particular means of attracting replacements. We find nothing in the Act or its legislative history to indicate that super-seniority is necessarily an acceptable method of resisting the economic impact of a strike, nor do we find anything inconsistent with the result which the Board reached. On the contrary, these sources are wholy consistent with, and lend full support to, the conclusion of the Board.
23
Section 79 guarantees, and § 8(a)(1) protects from employer interference the rights of employees to engage in concerted activities, which, as Congress as indicated, H.R.Rep. No. 245, 80th Cong., 1st Sess. 26, include the right to strike. Under § 8(a)(3), it is unlawful for an employer by discrimination in terms of employment to discourage 'membership in any labor organization,' which includes discouraging participation in concerted activities, Radio Officers Union of Commercial Telegraphers Union, A.F.L. v. National Labor Relations Board, 347 U.S. 17, 39—40, 74 S.Ct. 323, 335, 98 L.Ed. 455, such as a legitimate strike. National Labor Relations Board v. Wheeling Pipe Line, Inc., 8 Cir., 229 F.2d 391; Republic Steel Corp. v. National Labor Relations Board, 3 Cir., 114 F.2d 820. Section 1310 makes clear that although the strike weapon is not an unqualified right, nothing in the Act except as specifically provided is to be construed to interfere with this means of redress, H.R.Conf.Rep. No. 510, 80th Cong., 1st Sess. 59, U.S.Code Congressional Service 1947, p. 1135, and § 2(3)11 preserves to strikers their unfilled positions and status as employees during the pendency of a strike. S.Rep. No. 573, 74th Cong., 1st Sess. 6.12 This repeated solicitude for the right to strike is predicated upon the conclusion that a strike when legitimately employed is an economic weapon which in great measure implements and supports the principles of the collective bargaining system.13
24
While Congress has from time to time revamped and redirected national labor policy, its concern for the integrity of the strike weapon has remained constant. Thus when Congress chose to qualify the use of the strike, it did so by prescribing the limits and conditions of the abridgment in exacting detail, e.g., §§ 8(b)(4), 8(d), by indicating the precise procedures to be followed in effecting the interference, e.g., § 10(j), (k), (l); §§ 206—210, Labor Management Relations Act, and by preserving the positive command of § 13 that the right to strike is to be given a generous interpretation within the scope of the labor Act. The courts have likewise repeatedly recognized and effectuated the strong interest of federal labor policy in the legitimate use of the strike. International Union of United Automobile, Aircraft and Agr. Implement Workers of America, CIO v. O'Brien, 339 U.S. 454, 70 S.Ct. 781, 94 L.Ed. 978; Amalgamated Ass'n of St. Elec. Ry. & Motor Coach Employees of America, Division 998 v. Wisconsin Employment Rel. Bd., 340 U.S. 383, 71 S.Ct. 359, 95 L.Ed. 364; National Labor Relations Board v. Remington Rand, Inc., 2 Cir., 130 F.2d 919; Cusano v. National Labor Relations Board, 3 Cir., 190 F.2d 898; cf. Sinclair Ref. Co. v. Atkinson, 370 U.S. 195, 82 S.Ct. 1328, 8 L.Ed.2d 440.
25
Accordingly, in view of the deference paid the strike weapon by the federal labor laws and the devastating consequences upon it which the Board found was and would be precipitated by respondent's inherently discriminatory super-seniority plan, we cannot say the Board erred in the balance which it struck here. Although the Board's decisions are by no means immune from attack in the courts as cases in this Court amply illustrate, e.g., National Labor Relations Board v. Babcock & Wilcox Co., 351 U.S. 105, 76 S.Ct. 679, 100 L.Ed. 975; National Labor Relations Board v. United Steelworkers, 357 U.S. 357, 78 S.Ct. 1268, 2 L.Ed.2d 1383; National Labor Relations Board v. Insurance Agents, 361 U.S. 477, 80 S.Ct. 419, 4 L.Ed.2d 454, its findings here are supported by substantial evidence, Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456, its explication is not inadequate, irrational or arbitrary, compare Phelps Dodge Corp. v. National Labor Relations Board, 313 U.S. 177, 196—197, 61 S.Ct. 845, 853—854, 85 L.Ed. 1271; National Labor Relations Board v. United Steelworkers, supra, and it did not exceed its powers or venture into an area barred by the statute. Compare National Labor Relations Board v. Insurance Agents, supra. The matter before the Board lay well within the mainstream of its duties. It was attempting to deal with an issue which Congress had placed in its hands and '(w)here Congress has in the statute given the Board a question to answer, the courts will give respect to that answer.' National Labor Relations Board v. Insurance Agents, supra, 361 U.S. at 499, 80 S.Ct. at 433. Here, as in other cases, we must recognize the Board's special function of applying the general provisions of the Act to the complexities of industrial life. Republic Aviation Corp. v. National Labor Relations Board, 324 U.S. 793, 798, 65 S.Ct. 982, 985, 89 L.Ed. 1372; Phelps Dodge Corp. v. National Labor Relations Board, supra, 313 U.S. at 194, 61 S.Ct. at 852, and of '(appraising) carefully the interests of both sides of any labormanagement controversy in the diverse circumstances of particular cases' from its special understanding of 'the actualities of industrial relations.' National Labor Relations Board v. United Steelworkers, supra, 357 U.S. at 362 363, 78 S.Ct. at 1271. 'The ultimate problem is the balancing of the conflicting legitimate interests. The function of striking that balance to effectuate national labor policy is often a difficult and delicate responsibility, which the Congress committed primarily to the National Labor Relations Board, subject to limited judicial review.' National Labor Relations Board v. Truck Drivers Local Union, 353 U.S. 87, 96, 77 S.Ct. 643, 648, 1 L.Ed.2d 676.
26
Consequently, because the Board's judgment was that the claimed business purpose would not outweigh the necessary harm to employee rights—a judgment which we sustain—it could properly put aside evidence of respondent's motive and decline to find whether the conduct was or was not prompted by the claimed business purpose. We reverse the judgment of the Court of Appeals and remand the case to that court since its review was a limited one and it must now reach the remaining questions before it, including the propriety of the remedy which at least in part turns upon the Board's construction of the settlement agreement as being no barrier to an award not only of reinstatement but of back pay as well.14
27
Reversed and remanded.
28
Mr. Justice HARLAN, concurring.
29
I agree with the Court that the Board's conclusions respecting this 20-year 'superseniority' plan were justified without inquiry into the respondents' motives. However, I do not think that the same thing would necessarily be true in all circumstances, as for example with a plan providing for a much shorter period of extra seniority. Being unsure whether the Court intends to hold that the Board has power to outlaw all such plans, irrespective of the employer's motives and other circumstances, or only to sustain its action in the particular circumstances of this case, I concur in the judgment.
1
'Sec. 8(a). It shall be an unfair labor practice for an employer—
'(1) to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in section 7;
'(3) by discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization; * * *
'(5) to refuse to bargain collectively with the representatives of his employees, subject to the provisions of section 9(a).'
2
In addition to these employees, 450 employees in the unit were on layoff status.
3
The figure of 20 years was developed from a projection, on the basis of expected orders, of what the company's work force would be following the strike. As of March 31, the beginning of the strike, a male employee needed seven years' seniority to avoid layoff and a female employee nine years'.
4
The Examiner had relied upon the company's employment records for his conclusion that the replacement program was ineffective until the announcement of the super-seniority awards. The General Counsel, to show that such a plan was not necessary for that purpose, pointed to the facts that the company had 300 unprocessed job applications when the strike ended, that the company declared to the union that it could have replaced all the strikers and that the company did not communicate its otherwise well-publicized policy to replacements before they were hired but only after they accepted jobs.
5
In addition, the Board held that continued insistence on this or a similar proposal as a condition to negotiating an agreement constituted a refusal to bargain in good faith under § 8(a)(5). See National Labor Relations Board v. Wooster Division of Borg-Warner Corp., 356 U.S. 342, 78 S.Ct. 718, 2 L.Ed.2d 823.
The Board also concluded that on May 29, when the union voted to continue striking in protest against the superseniority plan, the strike was converted into an unfair labor practice strike. All strikers not replaced at that date, the Board held, were entitled to reinstatement as of the date of their unconditional abandonment of the strike regardless of replacements. See National Labor Relations Board v. Pecheur Lozenge Co., 2 Cir., 209 F.2d 393.
6
Accordingly, those cases holding unlawful a super-seniority plan prompted by a desire on the part of the employer to penalize or discriminate against striking employees, Ballas Egg Products v. National Labor Relations Board, 6 Cir., 283 F.2d 871; National Labor Relations Board v. California Date Growers Ass'n, 9 Cir., 259 F.2d 587; Olin Mathieson Chem. Corp. v. National Labor Relations Board, 4 Cir., 232 F.2d 158, aff'd per curiam, 352 U.S. 1020, 77 S.Ct. 587, are explainable without reaching the considerations present here.
7
See, e.g., National Labor Relations Board v. Mackay Radio & Tel. Co., 304 U.S. 333, 58 S.Ct. 904, 82 L.Ed. 1381; Republic Aviation Corp. v. National Labor Relations Board, 324 U.S. 793, 65 S.Ct. 982, 89 L.Ed. 1372; National Labor Relations Board v. Babcock & Wilcox Co., 351 U.S. 105, 76 S.Ct. 679, 100 L.Ed. 975; National Labor Relations Board v. Truck Drivers Local Union, 353 U.S. 87, 77 S.Ct. 643, 1 L.Ed.2d 676.
8
In a variety of situations, the lower courts have dealt with and rejected the approach urged here that conduct otherwise unlawful is automatically excused upon a showing that it was motivated by business exigencies. Thus, it has been held that an employer cannot justify the discriminatory discharge of union members upon the ground that such conduct is the only way to induce a rival union to remove a picket line and permit the resumption of business, National Labor Relations Board v. Star Publishing Co., 9 Cir., 97 F.2d 465, or rearrange the bargaining unit because of an expected adverse effect on production, Allis-Chalmers Mfg. Co. v. National Labor Relations Board, 7 Cir., 162 F.2d 435, or defend a refusal to bargain in good faith on the ground that unless the employer's view prevails dire consequences to the business will follow, National Labor Relations Board v. Harris, 5 Cir., 200 F.2d 656, or refuse exclusive recognition to a union for fear that such recognition will bring reprisals from rival unions. McQuay-Norris Mfg. Co. v. National Labor Relations Board, 7 Cir., 116 F.2d 748, cert. denied, 313 U.S. 565, 61 S.Ct. 843, 85 L.Ed. 1524; National Labor Relations Board v. National Broadcasting Co., 2 Cir., 150 F.2d 895, or discriminate in his business operations against employees of rival unions or without union affiliation solely in order to keep peace in the plant and avoid disruption of business, Wilson & Co., Inc. v. National Labor Relations Board, 8 Cir., 123 F.2d 411; National Labor Relations Board v. Hudson Motor Car Co., 6 Cir., 128 F.2d 528; National Labor Relations Board v. Gluek Brewing Co., 8 Cir., 144 F.2d 847; National Labor Relations Board v. Oertel Brewing Co., 6 Cir., 197 F.2d 59; National Labor Relations Board v. McCatron, 9 Cir., 216 F.2d 212, cert. denied, 348 U.S. 943, 75 S.Ct. 365, 99 L.Ed. 738; National Labor Relations Board v. Richards, 3 Cir., 265 F.2d 855. See also Idaho Potato Growers v. National Labor Relations Board, 9 Cir., 144 F.2d 295; Cusano v. National Labor Relations Board, 3 Cir., 190 F.2d 898; National Labor Relations Board v. Industrial Cotton Mills, 4 Cir., 208 F.2d 87, 45 A.L.R.2d 880, cert. denied, 347 U.S. 935, 74 S.Ct. 630, 98 L.Ed. 1086. Indeed, many employers doubtless could conscientiously assert that their unfair labor practices were not malicious but were prompted by their best judgment as to the interests of their business. Such good-faith motive itself, however, has not been deemed an absolute defense to an unfair labor practice charge.
9
'Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to refrain from any or all of such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 8(a)(3).'
10
'Nothing in this Act, except as specifically provided for herein, shall be construed so as either to interfere with or impede or diminish in any way the right to strike, or to affect the limitations or qualifications on that right.'
11
'The term 'employee' * * * shall include any individual whose work has ceased as a consequence of, or in connection with, any current labor dispute or because of any unfair labor practice, and who has not obtained any other regular and substantially equivalent employment * * *.'
12
This concern for the maintenance of the status prevailing before the strike has had its most recent manifestation in the 1959 amendments to the National Labor Relations Act. Congress there withdrew the ban inserted by the Taft-Hartley amendment disqualifying replaced strikers from voting in union elections. Now, employees not entitled to reinstatement can, under regulations promulgated by the Board, exercise their pre-strike voting rights. See § 9(c) (3); S.Rep. No. 187, 86th Cong., 1st Sess. 32—33, U.S.Code Congressional and Administrative News 1959, p. 2318.
13
'Labor unions * * * were organized out of the necessities of the situation. A single employee was helpless in dealing with an employer. He was dependent ordinarily on his daily wage for the maintenance of himself and family. If the employer refused to pay him the wages that he thought fair, he was nevertheless unable to leave the employ and to resist arbitrary and unfair treatment. Union was essential to give laborers opportunity to deal on equality with their employer. They united to exert influence upon him and to leave him in a body in order by this inconvenience to induce him to make better terms with them. They were withholding their labor of economic value to make him pay what they thought it was worth. The right to combine for such a lawful purpose has in many years not been denied by any court. The strike became a lawful instrument in a lawful economic struggle or competition between employer and employees as to the share or division between them of the joint product of labor and capital.'
American Steel Foundries v. Tri-City Central Trades Council, 257 U.S. 184, 209, 42 S.Ct. 72, 78, 66 L.Ed. 189, quoted in Staff Report for Senate Committee on Education and Labor, 74th Cong., 1st Sess., Comparison of S. 2926 (73d Cong.) and S. 1958 (74th Cong.) 20. See also, Remarks of Senator Wagner before Senate Committee on Education and Labor, 73d Cong., 2d Sess., Hearings on S. 2926, 10—11:
'It has been urged that the bill places a premium on discord by declaring that none of its provisions shall impair the right to strike. On the contrary, nothing would do more to alienate employee cooperation and to promote unrest than a law which did not make it clear that employees could refrain from working if that should become their only redress.'
Ramarks of Senator Taft, 93 Cong.Rec. 3835 (1947):
'That means that we recognize freedom to strike when the question involved is the improvement of wages, hours, and working conditions, when a contract has expired and neither side is bound by a contract. We recognize that right in spite of the inconvenience, and in some cases perhaps danger, to the people of the United States which may result from the exercise of such right. * * * We have considered the question whether the right to strike can be modified. I think it can be modified in cases which do not involve the basic question of wages, prices, and working conditions. * * * So far as the bill is concerned, we have proceeded on the theory that there is a right to strike and that labor peace must be based on free collective bargaining. We have done nothing to outlaw strikes for basic wages, hours, and working conditions after proper opportunity for mediation.'
14
'We do not agree with Respondent's contention that the Union in its strike settlement agreement of July 17 waived all rights for these employees. The settlement agreement provided, inter alia: 'The Company's replacement and job assurance policy to be resolved by the NLRB and the Federal Courts and to remain in effect pending final disposition.' It is clear that this agreement was intended merely as an interim settlement pending legal determination of the employees' rights. In any event, we would not in our discretion honor a private settlement which purported to deny to employees the rights guaranteed them by the Act. Cf. Wooster Division of Borg-Warner Corporation, 121 NLRB 1492, 1495.' Erie Resistor Corp., 132 N.L.R.B. 621, 631 n. 31.
| 67
|
373 U.S. 64
83 S.Ct. 1201
10 L.Ed.2d 202
HALLIBURTON OIL WELL CEMENTING COMPANY, Appellant,v.James S. REILY, Collector of Revenue, State of Louisiana.
No. 24.
Reargued Dec. 3, 1962.
Decided May 13, 1963.
Rehearing Denied June 17, 1963.
See 374 U.S. 858, 83 S.Ct. 1861.
Benjamin B. Taylor, Jr., Baton Rouge, La., for appellant.
Chapman L. Sanford, Baton Rouge, La., for appellee.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
The sole issue before us is whether the Louisiana use tax, as applied to the appellant, discriminates against interstate commerce in violation of the Commerce Clause of the Constitution.
2
The Louisiana sales and use taxes follow the basic pattern approved by this Court in Henneford v. Silas Mason Co., 300 U.S. 577, 57 S.Ct. 524, 81 L.Ed. 814. Louisiana Revised Statutes, Tit. 47, § 302, LSA, provides for the imposition of a tax '(a)t the rate of two per centum (2%) of the sales price of each item or article of tangible personal property when sold at retail in this state * * *.'1 It imposes another tax '(a)t the rate of two per centum (2%) of the cost prices of each item or article of tangible personal property when the same is not sold but is used * * * in this state * * *.'2 This latter tax, commonly known as a use tax, is to be reduced by the amount of any similar sales or use tax paid on the item in a different State. La.Rev.Stat.Ann. § 47:305. As noted by the Louisiana Supreme Court below and approved in Silas Mason, the purpose of such a sales-use tax scheme is to make all tangible property used or consumed in the State subject to a uniform tax burden irrespective of whether it is acquired within the State, making it subject to the sales tax, or from without the State, making it subject to a use tax at the same rate. The appellant admits the validity of such a scheme. It contends, however, that in this case Louisiana has departed from the norm of tax equality and imposes on the appellant a greater tax burden solely because the property it uses in Louisiana is brought from out-of-state. The difference in tax burden is admitted by the appellee.
3
The facts were stipulated by the parties. The appellant is engaged in the business of servicing oil wells in a number of oil producing States, including Louisiana. Its business requires the use of specialized equipment including oil well cementing trucks and electrical well logging trucks. These trucks and their equipment are not generally available on the retail market, but are manufactured by the appellant at its principal place of business in Duncan, Oklahoma. The raw materials and semifinished and finished articles necessary for the manufacture of these units are acquired on the open market by the appellant and assembled by its employees. The completed units are tested at Duncan and then assigned to specific field camps maintained by the appellant. The assignment is permanent unless better use of the unit can be made at another camp. None of these units is manufactured or held for sale to third parties.
4
Between January 1, 1952, and May 31, 1955, the appellant shipped new and used units of its specialized equipment to field camps in Louisiana. In its Louisiana tax returns filed for these years, the appellant calculated and paid use taxes upon the value of the raw materials and semifinished and finished articles used in manufacturing the units. The appellant did not include in its calculations the value of labor and shop overhead attributable to assembling the units. It is admitted that this cost factor would not have been taxed had the appellant assembled its units in Louisiana rather than in Oklahoma. The stipulation of facts stated:
5
'If Halliburton had purchased its materials, operated its shops, and incurred its Labor and Shop Overhead expenses at a location within the State of Louisiana, there would have been a sales tax due to the State of Louisiana upon the cost of materials purchased in Louisiana and a Use Tax on materials purchased outside of Louisiana; but there would have been no Louisiana sales tax or use tax due upon the Labor and Shop Overhead.'
6
Nevertheless, in September 1955, the Louisiana Collector of Revenue, the appellee, assessed a deficiency of $36,238.43 in taxes, including interest, on the labor and shop overhead cost of assembling the units. The Collector held that this was required by the language of the use tax section of the statute which levies the 2% use tax on the 'cost price' of the item, 'cost price' being defined in an earlier section as the actual cost without deductions on account of 'labor or service cost, * * * or any other expenses whatsoever.' La.Rev.Stat.Ann. § 47:301(3).
7
Also during this period, the appellant purchased 14 oil well cementing service units from the Spartan Tool and Service Company of Houston, Texas. Spartan was not regularly engaged in the sale of such equipment and made the sale after deciding to liquidate its oil well servicing business. The appellant transferred these units to Louisiana. On one other occasion, the appellant purchased an airplane from the Western Newspaper Union of New York, a company not regularly engaged in the business of selling airplanes. The appellant acquired the plane for use in Louisiana. No Louisiana use tax was declared or paid subsequent to the transfer of these items to Louisiana. It is admitted in the stipulation of facts that had these acquisitions been made within Louisiana, they would have not been taxed. This is occasioned by the fact that the sales tax section of the statute applies only to sales made at retail and not to isolated sales by those not regularly engaged in the business of selling the item involved. Nevertheless, the Collector assessed a deficiency of $4,404.22 on the value of these items since the use tax on goods imported from out-of-state contains no equivalent distinction between isolated and retail sales.
8
The appellant paid the deficiency under protest and brought an action in the Louisiana District Court for the Nineteenth District for a refund pursuant to La.Rev.Stat.Ann. § 47:1576, alleging that this unequal tax burden is a discrimination against interstate commerce. The District Court found the assessment discriminatory. On appeal, the Louisiana Supreme Court reversed, holding that since no unreasonable distinctions or classifications had been drawn in the Louisiana sales and use tax statute, the incidental discrepancy in tax burden did not amount to a discrimination against interstate commerce. 241 La. 67, 127 So.2d 502. On appeal to this Court, we noted probable jurisdiction. 368 U.S. 809, 82 S.Ct. 60, 7 L.Ed.2d 19. The case was first argued during the October Term 1961. We subsequently ordered it reargued. 369 U.S. 835, 82 S.Ct. 865, 7 L.Ed.2d 841.
I.
9
This is another in a long line of cases attacking state taxation as unduly burdening interstate commerce. As this Court stated in Best & Co. v. Maxwell, 311 U.S. 454, 455—456, 61 S.Ct. 334, 335, 85 L.Ed. 275: 'In each case it is our duty to determine whether the statute under attack, whatever its name may be, will in its practical operation work discrimination against interstate commerce.' This concern with the actuality of operation, a dominant theme running through all state taxation cases, extends to every aspect of the tax operations. Thus, in Nippert v. Richmond, 327 U.S. 416, 66 S.Ct. 586, 90 L.Ed. 760, the City of Richmond placed a fixed fee and earnings tax on itinerant solicitors of sales within the city. On its face, the ordinance applied to in-state as well as out-of-state distributors doing business by means of itinerant solicitors. The Court noted, however, the very fact that a distributor is out-of-state makes his use of, and dependence on, solicitors more likely. Thus, 'the very difference between interstate and local trade, taken in conjunction with the inherent character of the tax, makes equality of application as between those two classes of commerce, generally speaking, impossible.' 327 U.S. at 432, 66 S.Ct. at 594. The Court concluded that the tax was 'discriminatory in favor of the local merchant as against the out-of-state one.' 327 U.S. at 431, 66 S.Ct. at 593. Considered in isolation, the Louisiana use tax is discriminatory; it was intended to apply primarily to goods acquired out-of-state and used in Louisiana.3 If it stood alone, it would be invalid. However, a proper analysis must take 'the whole scheme of taxation into account.' Galveston, H. & S.A.R. Co. v. Texas, 210 U.S. 217, 227, 28 S.Ct. 638, 640, 52 L.Ed. 1031; Gregg Dyeing Co. v. Query, 286 U.S. 472, 479—480, 52 S.Ct. 631, 634, 76 L.Ed. 1232. Thus, in Best & Co. v. Maxwell, supra, the Court compared the solicitation tax with the equivalent tax on local retail merchants before finding it discriminatory. 311 U.S., at 456. See Memphis Steam Laundry Cleaner, Inc., v. Stone, 342 U.S. 389, 394—395, 72 S.Ct. 424, 427, 96 L.Ed. 436; cf. Phillips Chemical Co. v. Dumas School District, 361 U.S. 376, 80 S.Ct. 474, 4 L.Ed.2d 384.
10
When Henneford v. Silas Mason Co., 300 U.S. 577, 57 S.Ct. 524, 81 L.Ed. 814, reached this Court on appeal, the Court considered the Washington use tax in the context of the tax scheme of which it was a part, as a 'compensating tax' intended to complement the state sales tax. So considered, the Court concluded: 'Equality is the theme that runs through all the sections of the statute. * * * No one who uses property in Washington after buying it at retail is to be exempt from a tax upon the privilege of enjoyment except to the extent that he has paid a use or sales tax somewhere.' The use tax is 'upon one activity or incident,' and the sales tax is 'upon another, but the sum is the same when the reckoning is closed.' The burden on the out-of-state acquisition 'is balanced by an equal burden where the sale is strictly local.' 300 U.S., at 583—584, 57 S.Ct. at 527.
11
The conclusion is inescapable: equal treatment for in-state and out-of-state taxpayers similarly situated is the condition precedent for a valid use tax on goods imported from out-of-state.
12
The inequality of the Louisiana tax burden between in-state and out-of-state manufacturer-users is admitted. Although the rate is the same, the appellant's tax base is increased through the inclusion of its product's labor and shop overhead. The Louisiana Supreme Court characterized this discrepancy as incidental. However, equality for the purposes of competition and the flow of commerce is measured in dollars and cents, not legal abstractions.4 In this case the 'incidental discrepancy'—the labor and shop overhead for the units in dispute—amounts to $1,547,109.70. The use tax rate in Louisiana is 2% and has risen in some States to 4%.5 The resulting tax inequality is clearly substantial.
13
But even accepting this, the Louisiana Supreme Court concluded that the comparison between in-state and out-of-state manufacturer-users is not the proper way to frame the issue of equality. It stated: 'The proper comparison would be between the use tax on the assembled equipment and a sales tax on the same equipment if it were sold.' On the basis of such a comparison, the out-of-state manufacturer-user is on the same tax footing with respect to the item used as the retailer of a similar item, or the competitor who buys from the retailer rather than manufacture his own. However, such a comparison excludes from consideration, without any explanation, the very in-state taxpayer who is most similarly situated to the appellant, the local manufacturer-user. If the Louisiana Legislature were in fact concerned over any tax break the manufacturer-user obtains, it would surely have made special arrangements to take care of the in-state as well as out-of-state loophole—unless, of course, it intended to discriminate. We can only conclude, therefore, that the proper comparison on the basis of this record is between in-state and out-of-state manufacturer-users. And if this comparison discloses discriminatory effects, it could be ignored only after a showing of adequate justification.
14
While the inequality in question may have been an accident of statutory drafting, it does in fact strike at a significant segment of economic activity and carries economic effects of a type proscribed by many previous cases. The appellant manufactures equipment specially adapted to its oil servicing business. The equipment is expensive; because of its limited and custom production, the labor and shop overhead is necessarily a significant cost factor. Activity of this character is often on the forefront of economic development where equipment and methods have yet to reach the standardization and acceptance necessary for mass production. If Louisiana were the only State to impose an additional tax burden for such out-of-state operations, the disparate treatment would be an incentive to locate within Louisiana; it would tend 'to neutralize advantages belonging to the place of origin.' Baldwin v. G.A.F. Seelig, Inc., 294 U.S. 511, 527, 55 S.Ct. 497, 502, 79 L.Ed. 1032. Disapproval of such a result is implicit in all cases dealing with tax discrimination since a tax which is 'discriminatory in favor of the local merchant,' Nippert v. Richmond, supra, also encourages an out-of-state operator to become a resident in order to compete on equal terms.6 If similar unequal tax structures were adopted in other States, a not unlikely result of affirming here, the effects would be more widespread. The economic advantages of a single assembly plant for the appellant's multistate activities would be decreased for units sent to every State other than the State of residence. At best, this would encourage the appellant to locate his assembly operations in the State of largest use for the units. At worst, it would encourage their actual fractionalization or discontinuance. Clearly, approval of the Louisiana use tax in this case would 'invite a multiplication of preferential trade areas destructive of the very purpose of the Commerce Clause.' Dean Milk Co. v. Madison, 340 U.S. 349, 356, 71 S.Ct. 295, 299, 95 L.Ed. 329.7
15
In light of these considerations we see no reason to depart from the strict rule of equality adopted in Silas Mason, and we conclude that the Louisiana use tax as applied to the appellant's specialized equipment discriminates against interstate commerce.
16
A similar disposition of the tax on the isolated sales follows as a matter of course. The disparate treatment is baldly admitted by the Louisiana Supreme Court: 'The exemption of an isolated sale from the provisions of the sales tax applies strictly to sales within the State of Louisiana; it has no effect whatsoever on any transaction without the state.' The out-of-state isolated sale, it concludes, must therefore be treated 'as if' it were a sale at retail. As the facts of this case indicate, isolated sales involve primarily the acquisition of second-hand equipment from previous users. The effect of the tax is to favor local users who wish to dispose of equipment over out-of-state users similarly situated. Whatever the Louisiana Legislature's reasons for granting such an exemption to this segment of the local second-hand market,8 no attempt has been made to justify it or to show how its purpose would be defeated by extending the same exemption to similar out-of-state transactions.9 We therefore conclude that the use tax on isolated sales in this case departs from the equality required by Silas Mason and discriminates against interstate commerce.
17
Thirty-five States other than Louisiana have sales and use tax statutes. At this juncture, Louisiana, according to the parties, is the only State to adopt the constructions presented for decision in this case. Those few States which have considered these issues at all appear to have rejected the Louisiana position for reasons in accord with our opinion here. Both Ohio and North Dakota have by administrative regulations excluded labor and shop overhead from the tax base of the out-of-state manufacturer-user on the ground that its inclusion might violate the Commerce Clause.10 In Chicago Bridge & Iron Co. v. Johnson, 19 Cal.2d 162, 119 P.2d 945, the California Supreme Court upheld the application of its use tax to an out-of-state manufacturer-user,expressly pointing out that because labor and shop overhead had been excluded from its tax base, the taxpayer was in no different position from its in-state competitor. The parties have been able to find only one state case passing directly on either question. In State v. Bay Towing & Dredging Co., Inc., 265 Ala. 282, 90 So.2d 743, the Alabama Supreme Court held that the instate exemption for isolated sales had to be extended to out-of-state isolated sales to avoid discrimination against interstate commerce.
18
The judgment of the Supreme Court of Louisiana is reversed and the case remanded for further proceedings not inconsistent with this opinion.
19
Reversed and remanded.
20
Mr. Justice BRENNAN, concurring.
21
I fully concur in the opinion of the Court insofar as it treats of isolated sales. It seems clear that Louisiana exempts from sales taxation within the State the purchase of items which, if bought outside the State and brought in, would eventually incur a Louisiana use tax. The equality of treatment which my Brother CLARK finds assured by the credit for taxes already paid to other States seems to me wholly fortuitous. The credit for prior sales or use taxes will avert discrimination in the taxation of casual sales only if the out-of-state purchaser has already paid a sales or use tax equal to or greater than Louisiana's use tax, so that the credit is fully effective. If the purchaser abroad has paid no prior tax, or one of smaller amount, then upon his first use of the article in Louisiana he incurs a tax liability which he would clearly have escaped had he made the identical purchase at an exempted casual sale within the State. No justification for such discrimination has been suggested, and I can think of none beyond a mere possibility of administrative convenience.
22
I also agree that, under the circumstances of this case, the application of Louisiana's use tax statute to appellant is constitutionally impermissible. This result does not, I think, flow from any duty upon the States to ensure absolute equality of economic burden as between sales and use taxpayers. For we have sustained the constitutionality of the sales and compensating use tax system, Henneford v. Silas Mason Co., 300 U.S. 577, 57 S.Ct. 524, 81 L.Ed. 814, even though as a matter of economic fact the out-of-state use taxpayer is likely ultimately to incur a heavier burden than his in-state counterpart, the sales taxpayer. Such a disparity may result, though the rate of taxation upon the two is identical, because the in-state seller is somewhat likelier to absorb some part of the salestax burden than is the out-of-state seller to absorb the burden of the use tax which his customer eventually must pay. Warren and Schlesinger, Sales and Use Taxes: Interstate Commerce Pays Its Way, 38 Col.L.Rev. 49, 70—74 (1938). And we have also intimated, 300 U.S., at 587, that a State may not be constitutionally obliged to credit the amount of sales taxes paid in other States against the use tax it imposes. See Note, 51 Harv.L.Rev. 130, 132—133 (1937). Nevertheless, if the Constitution does not mandate absolute equality of treatment as between in-state and out-of-state sales, it assuredly does forbid discriminatory treatment by the States. Discrimination would result if different rates of taxation were imposed by the State on use and sale, and it is the result here because Louisiana, while it taxes the full value of property assembled without and used but not sold within the State, does not tax the full value of property assembled within the State and used but not sold there.
23
It does not follow, however, nor do I read the Court's opinion as so holding, that as a result of today's decision Louisiana has no option but to adopt the practice of Ohio, North Dakota, and California, see pp. 74—75, supra, and exclude labor and shop overhead from the tax base of the out-of-state manufacturer-user. That might be the case if the sole justification for the use tax were to offset the effect of sales taxes imposed on in-state purchasers, and thereby to deter domestic consumers from seeking to evade the sales tax by purchasing out of state. But we have recognized an alternative justification for the use tax as a levy upon 'the privilege of use after commerce is at an end.' 300 U.S., at 582, 57 S.Ct. at 526; see Hartman, State Taxation of Interstate Commerce (1953), 162 163. Thus Louisiana surely may if it chooses tax appellant's trucks and equipment, when they come to rest in the State, at their full value. Since this alternative is available to Louisiana and any other use-tax State, I fail to see the inevitability of my Brother CLARK's prediction that 'this decision will deprive Louisiana of millions of dollars under its sales tax.' The Court holds no more than that if Louisiana chooses to levy such a use tax it cannot constitutionally exempt in-state manufacturer-users as it now does; it must tax 'the privilege of use' within the State of the property of such users at full value and at the same rates. Nothing in the Court's opinion nor in my view of the case prescribes the particular manner in which Louisiana must obey the Constitution.
24
Mr. Justice CLARK, with whom Mr. Justice BLACK joins, dissenting.
25
The Court strikes down Louisiana's use tax on the ground that it discriminates against out-of-state assemblers of nates against out-of-state assemblers who move their products into the State for use therein. In so doing the Court permits the out-of-state assembler to move his finished product into the State at a tax lower than that exacted upon Louisiana's residents who purchase the identical product within the State. The damage that this decision will do to the tax structure of a State is clearly revealed by the amici curiae briefs filed here. Thomas Jordan, Inc., rents barges to others in Louisiana. They are built by shipyards outside of Louisiana. Jordan claims that when it brings a barge to Louisiana it can only be taxed on the items that went into the barge, not the finished product. Chicago Bridge and Iron Company fabricates steel plates outside of Louisiana and ships them into Louisiana. It claims that its tax should be on the components of the plates. Sperry Rand Corporation, through its subsidiary Remington Rand, manufactures office furniture which it brings into Louisiana and rents to customers. It claims its tax is on the wood, metal, lacquers, etc., going into the furniture. Humble Oil and Refining Co. has Chicago Bridge and Iron Co. fabricate, outside of Louisiana, certain field erected structures for Humble's oil refinery at Baton Rouge and it claims the tax should be on the components of these completed structures. American Can Co. manufactures can manufacturing machinery outside of Louisiana which it ships into Louisiana for its use and it claims the tax should be only on the components of the machines. And, finally, Rosson-Richards Processing Co. wire wraps and coats iron pipe which it transports to Louisiana where the pipe is laid into oil and gas pipelines. It claims the tax is due only on the components of the finished pipe.
26
These claims are predicated on the the proposition that the finished product assembled outside Louisiana pays more tax upon entering Louisiana for use than a like finished product pays when assembled from parts within that State and used by the assembler thereof. But the tax is on the privilege of use after commerce is at an end and the test is whether all persons similarly situated are treated alike. Royster Guano Co. v. Virginia, 253 U.S. 412, 415, 40 S.Ct. 560, 561, 64 L.Ed. 989 (1920). And so it cannot be said that equal protection is denied by a statute which operates alike on all persons and property similarly situated. The fallacy of the Court's holding is that it ignores the incidence of the tax in Louisiana's Tax Act. That incidence is the moment that the product becomes a part of the mass of property within the State. It matters not what happens to the property subsequently. The tax attaches to the property in its form at that specific time. This is true in both the sales and the use tax here. It follows that if the barge, steel plates, office furniture, field erected structures, can manufacturing machinery, wire wrapped pipes and oil well servicing trucks are sold in Louisiana the 2% sales tax is exacted on the completed articles just as it is when they are moved into the State without sale and the use tax of 2% is levied. all persons and like property similarly situated are thus given identical treatment Likewise if Halliburton brought in nuts and bolts and put them together within Louisiana into a truck it would pay the identical tax a resident paid in a similar transaction. Again, if a Louisiana resident bought a completed truck outside his State and brought it into the State as did Halliburton, he would pay the same tax on the property. The result of Louisiana's law is similar to that described in Henneford v. Silas Mason Co., 300 U.S. 577, 584, 57 S.Ct. 524, 527 (1937):
27
'When the account is made up, the stranger from afar is subject to no greater burdens as a consequence of ownership than the dweller within the gates. The one pays upon one activity or incident, and the other upon another, but the sum is the same when the reckoning is closed. Equality exists when the chattel subjected to the use tax is bought in another state and then carried into Washington. It exists when the imported chattel is shipped from the state of origin under an order received directly from the state of destination. In each situation the burden borne by the owner is balanced by an equal burden where the sale is strictly local.'
28
The Court, however, would look beyond the taxable event. It would require the State to trace the nuts and bolts, etc., sold to the resident and tax their ultimate form—a truck—if it wished to tax Halliburton. This, of course, is an impossible burden and from a practical standpoint would not be enforceable. In addition, the Court changes the incidence of the tax as well as the property taxed. Nuts and bolts are not trucks. The incidence of the tax on the former was when they were nuts and bolts and not when they became a truck. They became a part of the mass of property of the State on their sale as nuts and bolts, not trucks.
29
I believe that this decision will deprive Louisiana of millions of dollars under its sales tax.1 Every sizable business concern not having Louisiana facilities to manufacture its own requirements will buy raw materials out of state and have them fabricated outside Louisiana—just as do Halliburton, Jordan, Humble, Chicago Bridge and the other amici—and then bring the finished product into Louisiana for use. Instead of paying a tax on the greater value of the finished product brought into and used in the State they will, under the Court's interpretation, pay only the lesser value of the various components that went into the finished product.
30
As for the isolated sales, the Act specifically provides for a credit on Louisiana use taxes of any like tax equal to or greater than the Louisiana tax which has been paid in another State. La.Rev.Stat.Ann. § 47:305. Property within Louisiana has already been subjected to a sales tax and subsequent sales are exempted. The credit allowed on the use tax for taxes paid in another State on isolated sales of property brought into Louisiana effects the same identical result. As the Supreme Court of Louisiana noted the 'property involved herein has not borne a similar tax in another state,' 241 La. at 91, 127 So.2d at 511, and the taxing authorities have unequivocally represented to this Court that such taxes would be allowed as credits if claimed and proven. I would take the promise of the State's authorities at its face value.2
31
For these, as well as the reasons given in the opinion of the Supreme Court of Louisiana, I would affirm.
1
Emphasis added.
2
Emphasis added.
3
In fact, it was just such isolated consideration that led the trial court in Silas Mason Co. v. Henneford, D.C., 15 F.Supp. 958, 962, rev'd 300 U.S. 577, 57 S.Ct. 524, 81 L.Ed. 814, to strike down the State of Washington use tax.
4
Thus in Memphis Steam Laundry Cleaner, Inc., v. Stone, supra, and Best & Co. v. Maxwell, supra, the Court compared the actual tax bills of the local and out-of-state taxpayers. In the former, the Court found discriminatory a $50 license tax on each truck used by an out-of-state laundry business soliciting and picking up laundry in Mississippi because resident laundries were required to pay only $8 per truck. In the latter, the Court found determinative a similar discrepancy between the $1 tax paid by local merchants and the $250 tax paid by the itinerant solicitor.
5
Michigan, Pennsylvania, and Washington each has 4% sales and use taxes. 2 P—H 1963 Fed.Tax Serv. 13,299.
6
See cases collected in Memphis Steam Laundry Cleaner, Inc., v. Stone, supra, p. 392, n. 7, 72 S.Ct. p. 426.
7
In Dean Milk Co., the City of Madison passed an ordinance requiring milk pasteurization plants to locate within a five mile radius of Madison to ease the problem of local health inspection. The Court held that where there were adequate alternative methods for insuring health standards, the locational requirement was a burden on interstate commerce. The dissent saw no problem in this restriction: 'As a practical matter, so far as the record shows, Dean can easily comply with the ordinance whenever it wants to. Therefore, Dean's personal preference to pasteurize in Illinois, not the ordinance, keeps Dean's milk out of Madison.' 340 U.S., at 357, 71 S.Ct., at 299.
However, this 'personal preference' is the essence of a national unrestricted market. If, before striking down a burden on interstate commerce this Court had to look to the record for economic justifications for Dean's location in Illinois, for the appellant's location in Oklahoma, for single rather than multipasteurization or assembly operations, the free flow of commerce would disappear before our very eyes. Justification for the system is presumed in the Commerce clause itself.
8
The appellee argues that the reason for the exemption is that any item sold in a local isolated sale has already been subjected to either a sales tax if it was originally acquired in Louisiana or a use tax if it was imported, whereas there is no assurance that an item acquired in an out-of-state isolated sale has ever sustained such a tax burden. The appellee further maintains that the taxes here in question could have been reduced by any such previous taxation. If the record supported the appellee's position, it would be carefully considered. However, the appellee has shown us no regulations providing for the deduction of sales or use taxes paid on the item prior to the out-of-state isolated sale; the appellee stated in the stipulation of facts that all evidence showing an isolated sale was irrelevant; and the above-quoted statement of the Louisiana Supreme Court leaves little room for such modification.
9
Although no evidence was presented on the issue, one reason for not taxing local isolated sales and the labor and shop overhead of the local manufacturer-user may be the difficult administrative burden in either calculating or enforcing the tax. However, such a local administrative problem would not justify a different treatment of the similar out-of-state transaction, since the mere extension of the special treatment to the out-of-state transaction would satisfy both the local problem and the Commerce Clause.
We fail to see a similar administrative problem in calculating the appellant's labor and shop overhead, since the tax base under either approach is calculated on the basis of the cost factors recorded in the appellant's books.
10
CCH Ohio State Rep., Cir. No. 18, Mar. 1, 1954, 60371.70; North Dakota Tax Commission, Rules Nos. 55 and 113.
Moreover, as this Court noted in Henneford v. Silas Mason Co., 300 U.S. 577, 581, 57 S.Ct. 524, 526, the State of Washington, recognizing the latent inequality, made special arrangements for the manufacturer-user:
'The tax presupposes everywhere a retail purchase by the user before the time of use. If he has manufactured the chattel for himself, * * * he is exempt from the use tax, whether title was acquired in Washington or elsewhere.'
1
For a like appraisal see Henneford v. Silas Mason Co., supra, at 581, 57 S.Ct. at 526: 'The plan embodied in these provisions is neither hidden nor uncertain. * * * The practical effect * * * is readily perceived. One of its effects must be that retail sellers in Washington will be helped to compete upon terms of equality with retail dealers in other states who are exempt from a sales tax or any corresponding burden. Another effect, or at least another tendency, must be to avoid the likelihood of a drain upon the revenues of the state, buyers being no longer tempted to place their orders in other states in the effort to escape payment of the tax on local sales.'
2
My Brother BRENNAN finds that the tax credit allowed by La.Rev.Stat.Ann. § 47:305 will not avoid inequality of treatment in all situations. I find no cases from Louisiana interpreting this section of the Act, but the appellee tax collector states in his brief that a tax credit is given 'for all similar taxes paid to another state' in order 'to insure perfect equality of the tax burden. * * *' In view of the Louisiana Supreme Court's demonstrated practice of construing the provisions of the use tax so as to avoid unreasonable and discriminatory applications, Fontenot v. S.E.W. Oil Corp., 232 La. 1011, 95 So.2d 638 (1957), I cannot agree with my Brother BRENNAN'S anticipation that unequal treatment will result in future applications of the Act. Cf. Monamotor Oil Co. v. Johnson, 292 U.S. 86, 95—96, 54 S.Ct. 575, 578, 78 L.Ed. 1141 (1934).
| 78
|
373 U.S. 132
83 S.Ct. 1210
10 L.Ed.2d 248
FLORIDA LIME AND AVOCADO GROWERS, INC., et al., Appellants,v.Charles PAUL, Director of the Department of Agriculture of California, et al. Charles PAUL, Director of the Department of Agriculture of California, et al., Appellants, v. FLORIDA LIME AND AVOCADO GROWERS, INC., et al.
Nos. 45, 49.
Argued Jan. 8, 1963.
Decided May 13, 1963.
As Amended May 27, 1963.
Rehearing Denied June 17, 1963.
See 374 U.S. 858, 83 S.Ct. 1861.
[Syllabus from pages 132-133 intentionally omitted]
Isaac E. Ferguson, Van Nuys, Cal., for appellants in No. 45 and for appellees in No. 49.
John Fourt, Sacramento, Cal., for appellees in No. 45 and for appellants in No. 49.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
Section 792 of California's Agricultural Code, which gauges the maturity of avocados by oil content, prohibits the transportation or sale in California of avocados which contain 'less than 8 per cent of oil, by weight * * * excluding the skin and seed.'1 In contrast, federal marketing orders approved by the Secretary of Agriculture gauge the maturity of avocados grown in Florida by standards which attribute no significance to oil content.2 This case presents the question of the constitutionality of the California statute insofar as it may be applied to exclude from California markets certain Florida avocados which, although certified to be mature under the federal regulations, do not uniformly meet the California requirement of 8% of oil.
2
Appellants in No. 45, growers and handlers of avocados in Florida, brought this action in the District Court for the Northern District of California to enjoin the enforcement of § 792 against Florida avocados certified as mature under the federal regulations. Appellants challenged the constitutionality of the statute on three grounds: (1) that under the Supremacy Clause, Art. VI, the California standard must be deemed displaced by the federal standard for determining the maturity of avocados grown in Florida; (2) that the application of the California statute to Florida-grown avocados denied appellants the Equal Protection of the Laws in violation of the Fourteenth Amendment; (3) that its application unreasonably burdened or discriminated against interstate marketing of Florida-grown avocados in violation of the Commerce Clause, Art. I, § 8. A three-judge District Court initially dismissed the complaint. D.C., 169 F.Supp. 774. On direct appeal we held, Florida Lime & Avocado Growers, Inc., v. Jacobsen, 362 U.S. 73, 80 S.Ct. 568, 4 L.Ed.2d 568, that the suit was one for a three-judge court under 28 U.S.C. § 2281, and presented a justiciable controversy to be tried on the merits. After a trial the three-judge court denied an injunction against the enforcement of § 792, on the ground that the proofs did not establish that its application to Florida-grown avocados violated any provision of the Federal Constitution. 197 F.Supp. 780. The District Court held for several reasons that the Supremacy Clause did not operate to displace § 792; no actual conflict existed between the statute and the federal marketing orders; neither the Agricultural Act nor the marketing orders occupied the field to the exclusion of the state statute; and Congress had not ordained that a federal marketing order was to give a license to Florida producers to 'market their avocados without further inspection by the states' after compliance with the federal maturity test. 197 F.Supp., at 787. Rather, the court observed, '(t)he Federal law does not cover the whole field of interstate shipment of avocados' but by necessary implication leaves the regulation of certain aspects of distribution to the States. Further, the District Court found no violation of the Equal Protection Clause because the California statute was applicable on identical terms to Florida and California producers, and was reasonably designed to enforce a traditional and legitimate interest of the State of California in the protection of California consumers. The District Court concluded, finally, that § 792 did not unreasonably burden or discriminate against interstate commerce in out-of-state avocados-that the 8% oil content test served in practice only to keep off California grocers' shelves fruit which was unpalatable because prematurely picked. This holding rested in part on the conclusion that mature Florida fruit had not been shown to be incapable of attaining 8% oil content, since only a very small fraction of Florida avocados of certain varieties in fact failed to meet the California test.3
3
Both parties have brought appeals here from the District Court's judgment: the Florida growers urge in No. 45 that the court erred in not enjoining enforcement of the state statute against Florida-grown avocados; in No. 49 the California state officials appeal on the ground that the action should have been dismissed for want of equity jurisdiction rather than upon the merits. We noted probable jurisdiction of both appeals. 368 U.S. 964, 965, 82 S.Ct. 439, 437, 7 L.Ed.2d 394. We affirm the judgment in the respect challenged by the cross-appeal in No. 49. In No. 45 we agree that appellants have not sustained their challenges to § 792 under the Supremacy and Equal Protection Clauses. However, we reverse and remand for a new trial insofar as the judgment sustains § 792 against appellants' challenge to the statute grounded on the Commerce Clause. We hold that the effect of the statute upon interstate commerce cannot be determined on the record now before us.
4
The California statute was enacted in 1925. Like the federal marketing regulations applicable to appellants, this statute sought to ensure the maturity of avocados reaching retail markets.4 The District Court found on sufficient evidence that before 1925 the marketing of immature avocados had created serious problems in California.5 An avocado, if picked prematurely, will not ripen properly, but will tend to decay or shrivel and become rubbery and unpalatable after purchase. Not only retail consumers but even experienced grocers have difficulty in distinguishing mature avocados from the immature by physical characteristics alone.6 Thus, the District Court concluded, '(t)he marketing of * * * (immature) avocados cheats the consumer' and adversely affects demand for and orderly distribution of the fruit. 197 F.Supp., at 783.
5
The federal marketing regulations were adopted pursuant to the Agricultural Adjustment Act, 7 U.S.C. §§ 601 et seq. The declared purposes of the Act are to restore and maintain parity prices for the benefit of producers of agricultural commodities, to ensure the stable and steady flow of commodities to consumers, and 'to establish and maintain such minimum standards of quality and maturity * * * as well effectuate such orderly marketing of such agricultural commodities as will be in the public interest.' § 2(3), 7 U.S.C. § 602(3). Whenever he finds that it would promote these declared policies, the Secretary is empowered upon notice and hearing to adopt federal marketing orders and regulations for a particular growing area, § 8c(3), (4), 7 U.S.C. § 608c(3), (4). Orders thus proposed by the Secretary become effective only when approved by a majority of the growers or producers concerned, § 8c(8), (9), 7 U.S.C. § 608c(8), (9).
6
In 1954, after proceedings in compliance with the statute, 19 Fed.Reg. 3439, the Secretary promulgated orders governing the marketing of avocados grown in South Florida.7 The orders established an Avocado Administrative Committee, composed entirely of South Florida avocado growers and handlers. 7 CFR § 969.20. This Committee has authority to draft and recommend to the Secretary various marketing regulations governing the quality and maturity of South Florida avocados. The maturity test for the South Florida fruit is based upon a schedule of picking dates, sizes and weights annually drafted and recommended by the Committee and promulgated by the Secretary.8 The regulations forbid picking and shipping of any fruit before the prescribed date, although an exemption from the picking-date schedule may be granted by the Committee.9 The regulations drafted by the Committee and promulgated by the Secretary concern other qualities and physical characteristics of Florida avocados besides maturity. See 22 Fed.Reg. 6205, 7 CFR §§ 51.3050-51.3053, 51.3064. All regulated avocados, including those shipped under picking-date exemptions, must be inspected for compliance with certain quality standards by the Federal-State Inspection Service, a joint authority supervised by the United States and Florida Departments of Agriculture.
7
Almost all avocados commercially grown in the United States come either from Southern California or South Florida. The California-grown varieties are chiefly of Mexican ancestry, and in most years contain at least 8% oil content when mature.10 The several Florida species, by contrast, are of West Indian and Guatemalan ancestry. West Indian avocados, which constitute some 12% of the total Florida production, may contain somewhat less than 8% oil when mature and ready for market. They do not, the District Court found, attain that percentage of oil 'until they are past their prime.' 197 F.Supp., at 783. But that variety need not concern us in this case since the District Court concluded on sufficient evidence that 'poor shipping qualities and short retail store shelf-life' make it commercially unprofitable, regardless of the oil test, to market the variety in California. On the other hand, the Florida hybrid and Guatemalan varieties, which do not encounter such handicaps, may reach maturity before they attain 8% oil content. The District Court concluded, nevertheless, that § 792 did not unreasonably interfere with their marketability since these species 'attain or exceed 8% oil content while in a prime commercial marketing condition,' so that the California test was 'scientifically valid as applied to' these varieties.
8
The experts who testified at the trial disputed whether California's percentage-of-oil test or the federal marketing orders' test of picking dates and minimum sizes and weights was the more accurate gauge of the maturity of avocados.11 In adopting his calendar test of maturity for the varieties grown in South Florida the Secretary expressly rejected physical and chemical tests as insufficiently reliable guides for gauging the maturity of the Florida fruit.12
I.
9
We consider first appellants' challenge to § 792 under the Supremacy Clause. That the California statute and the federal marketing orders embody different maturity tests is clear. However, this difference poses, rather than disposes of the problem before us. Whether a State may constitutionally reject commodities which a federal authority has certified to be marketable depends upon whether the state regulation 'stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress,' Hines v. Davidowitz, 312 U.S. 52, 67, 61 S.Ct. 399, 404, 85 L.Ed. 581. By that test, we hold that § 792 is not such an obstacle; there is neither such actual conflict between the two schemes of regulation that both cannot stand in the same area, nor evidence of a congressional design to preempt the field.
10
We begin by putting aside two suggestions of the appellants which obscure more than aid in the solution of the problem. First, it is suggested that a federal license or certificate of compliance with minimum federal standards immunizes the licensed commerce from inconsistent or more demanding state regulations. While this suggestion draws some support from decisions which have invalidated direct state interference with the activities of interstate, carriers, Castle v. Hayes Freight Lines, Inc., 348 U.S. 61, 75 S.Ct. 191, 99 L.Ed. 68, even in that field of paramount federal concern the suggestion has been significantly qualified, e.g., Huron Portland Cement Co. v. Detroit, 362 U.S. 440, 447-448, 80 S.Ct. 813, 818, 4 L.Ed.2d 852; Kelly v. Washington, 302 U.S. 1, 58 S.Ct. 87, 82 L.Ed. 3; cf. Bradley v. Public Utilities Comm'n, 289 U.S. 92, 53 S.Ct. 577, 77 L.Ed. 1053. That no State may completely exclude federally licensed commerce is indisputable, but that principle has no application to this case.
11
Second, it is suggested that the coexistence of federal and state regulatory legislation should depend upon whether the purposes of the two laws are parallel or divergent. This Court has, on the one hand, sustained state statutes having objectives virtually identical to those of federal regulations, People of State of California v. Zook, 336 U.S. 725, 730-731, 69 S.Ct. 841, 843-844, 93 L.Ed. 1005; cf. De Veau v. Braisted, 363 U.S. 144, 156-157, 80 S.Ct. 1146, 1152-1153, 4 L.Ed.2d 1109; Parker v. Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed. 315; and has, on the other hand, struck down state statutes where the respective purposes were quite dissimilar, First Iowa Hydro-Electric Cooperative v. Federal Power Comm'n, 328 U.S. 152, 66 S.Ct. 906, 90 L.Ed. 1143. The test of whether both federal and state regulations may operate, or the state regulation must give way, is whether both regulations can be enforced without impairing the federal superintendence of the field, not whether they are aimed at similar or different objectives.
12
The principle to be derived from our decisions is that federal regulation of a field of commerce should not be deemed preemptive of state regulatory power in the absence of persuasive reasons-either that the nature of the regulated subject matter permits no other conclusion, or that the Congress has unmistakably so ordained. See, e.g., Huron Portland Cement Co. v. Detroit, supra.
A.
13
A holding of federal exclusion of state law is inescapable and requires no inquiry into congressional design where compliance with both federal and state regulations is a physical impossibility for one engaged in interstate commerce, cf. Union Bridge Co. v. United States, 204 U.S. 364, 399-401, 27 S.Ct. 367, 379-380, 51 L.Ed. 523; Morgan v. Virginia, 328 U.S. 373, 66 S.Ct. 1050, 90 L.Ed. 1317; Bibb v. Navajo Freight Lines, Inc., 359 U.S. 520, 79 S.Ct. 962, 3 L.Ed.2d 1003. That would be the situation here if, for example, the federal orders forbade the picking and marketing of any avocado testing more than 7% oil, which the California test excluded from the State any avocado measuring less than 8% oil content. No such impossibility of dual compliance is presented on this record, however. As to those Florida avocados of the hybrid and Guatemalan varieties which were actually rejected by the California test, the District Court indicated that the Florida growers might have avoided such rejections by leaving the fruit on the trees beyond the earliest picking date permitted by the federal regulations, and nothing in the record contradicts that suggestion. Nor is there a lack of evidentiary support for the District Court's finding that the Florida varieties marketed in California 'attain or exceed 8% oil content while in a prime commercial marketing condition,' even though they may be 'mature enough to be acceptable prior to the time that they reach that content * * *.' 197 F.Supp., at 783. Thus the present record demonstrates no inevitable collision between the two schemes of regulation, despite the dissimilarity of the standards.
B.
14
The issue under the head of the Supremacy Clause is narrowed then to this: Does either the nature of the subject matter, namely the maturity of avocados, or any explicit declaration of congressional design to displace state regulation, require § 792 to yield to the federal marketing orders? The maturity of avocados seems to be an inherently unlikely candidate for exclusive federal regulation. Certainly it is not a subject by its very nature admitting only of national supervision, cf. Cooley v. Board of Port Wardens, 12 How. 299, 319-320, 13 L.Ed. 996. Nor is it a subject demanding exclusive federal regulation in order to achieve uniformity vital to national interests, cf. San Diego Building Trades Council v. Garmon, 359 U.S. 236, 241-244, 79 S.Ct. 773, 777-779, 3 L.Ed.2d 775.
15
On the contrary, the maturity of avocados is a subject matter of the kind this Court has traditionally regarded as properly within the scope of state superintendence. Specifically, the supervision of the readying of foodstuffs for market has always been deemed a matter of peculiarly local concern. Many decades ago, for example, this Court sustained a State's prohibition against the importation of artifically colored oleomargarine (which posed no health problem), over claims of federal preemption and burden on commerce. In the course of the opinion, the Court recognized that the States have always possessed a legitimate interest in 'the protection of (their) people against fraud and deception in the sale of food products' at retail markets within their borders. Plumley v. Massachusetts, 155 U.S. 461, 472, 15 S.Ct. 154, 158, 39 L.Ed. 223. See also Crossman v. Lurman, 192 U.S. 189, 199-200, 24 S.Ct. 234, 237, 238, 48 L.Ed. 401; Hygrade Provision Co. v. Sherman, 266 U.S. 497, 45 S.Ct. 141, 69 L.Ed. 402; Savage v. Jones, 225 U.S. 501, 525-529, 32 S.Ct. 715, 722-724, 56 L.Ed. 1182.
16
It is true that more recently we sustained a federal statute broadly regulating the production of renovated butter. But we were scrupulous in pointing out that a State might nevertheless-at least in the absence of an express contrary command of Congress-confiscate or exclude from market the processed butter which had complied with all the federal processing standards, 'because of a higher standard demanded by a state for its consumers.' A state regulation so purposed was, we affirmed, 'permissible under all the authorities.'13 Cloverleaf Butter Co. v. Patterson, 315 U.S. 148, 162, 62 S.Ct. 491, 499, 86 L.Ed. 754. That distinction is a fundamental one, which illumines and delineates the problem of the present case. Federal regulation by means of minimum standards of the picking, processing, and transportation of agricultural commodities, however comprehensive for those purposes that regulation may be, does not of itself import displacement of state control over the distribution and retail sale of those commodities in the interests of the consumers of the commodities within the State. Thus, while Florida may perhaps not prevent the exportation of federally certified fruit by superimposing a higher maturity standard, nothing in Cloverleaf forbids California to regulate their marketing. Congressional regulation of one end of the stream of commerce does not, ipso facto, oust all state regulation at the other end. Such a displacement may not be inferred automatically from the fact that Congress has regulated production and packing of commodities for the interstate market. We do not mean to suggest that certain local regulations may not unreasonably or arbitrarily burden interstate commerce; we consider that question separately, infra, pp. 152-154. Here we are concerned only whether partial congressional superintendence of the field (maturity for the purpose of introduction of Florida fruit into the stream of interstate commerce) automatically forecloses regulation of maturity by another State in the interests of that State's consumers of the fruit.
17
The correctness of the District Court's conclusion that § 792 was a regulation well within the scope of California's police powers is thus clear. While it is conceded that the California statute is not a health measure, neither logic nor precedent invites any distinction between state regulations designed to keep unhealthful or unsafe commodities off the grocer's shelves, and those designed to prevent the deception of consumers.14 See, e.g., Hygrade Provision Co. v. Sherman, supra; Plumley v. Massachusetts, supra. Nothing appearing in the record before us affords any ground for departure in this case from our consistent refusal to draw such a distinction.
C.
18
Since no irreconcilable conflict with the federal regulation requires a conclusion that § 792 was displaced, we turn to the question whether Congress has nevertheless ordained that the state regulation shall yield. The settled mandate governing this inquiry, in deference to the fact that a state regulation of this kind is an exercise of the 'historic police powers of the States,' is not to decree such a federal displacement 'unless that was the clear and manifest purpose of Congress,' Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146, 1152, 91 L.Ed. 1447. In other words, we are not to conclude that Congress legislated the ouster of this California statute by the marketing orders in the absence of an unambiguous congressional mandate to that effect. We search in vain for such a mandate.
19
The provisions and objectives of the Agricultural Adjustment Act bear little resemblance to those in which only last Term we found a preemptive design in Campbell v. Hussey, 368 U.S. 297, 82 S.Ct. 327, 7 L.Ed.2d 299. In the Federal Tobacco Inspection Act involved in that case, Congress had declared 'uniform standards of classification and inspection' to be 'imperative for the protection of producers and others engaged in commerce and the public interest therein.' 7 U.S.C. § 511a. The legislative history was replete with references to a need for 'uniform' or 'official' standards, which could harmonize the grading and inspection of tobacco at all markets throughout the country. Under the statute a single set of standards was to be promulgated by the Secretary of Agriculture, 'and the standards so established would be the official standards of the United States for such purpose.' S.Rep. No. 1211, 74th Cong., 1st Sess. 1.
20
Nothing in the language of the Agricultural Adjustment Act-passed by the same Congress the very next day15-discloses a similarly comprehensive congressional design. There is but one provision of the statute which intimates any purpose to make agricultural production controls the monitors of retail distribution-the reference to a policy of establishing such 'minimum standards of quality and maturity and such grading and inspection requirements * * * as will effectuate * * * orderly marketing * * * in the public interest.' 7 U.S.C. § 602(3). That language cannot be said, without more, to reveal a design that federal marketing orders should displace all state regulations. By its very terms, in fact, the statute purports only to establish minimum standards.
21
Other provisions of the Act, and their history, militate even more strongly against federal displacement of these state regulations. First, the adoption of marketing agreements and orders is authorized only when the Secretary has determined that economic conditions within a particular growing area require federally supervised cooperation among the growers to alleviate those conditions. 7 U.S.C. § 608c(1), (2). Moreover, the relief afforded the growers is to be temporary; 'the Secretary is directed to cease exercising such powers' when 'the circumstances described * * * no longer exist.' H.R.Rep. No. 1241, 74th Cong., 1st Sess. 4. And consistently with these terms, the Secretary himself has characterized the marketing agreements as essentially 'self-help programs' instituted and administered by the farmers involved. This view has recently been elaborated by the Secretary:
22
'The Act itself does not impose regulations over the marketing of any agricultural commodity. It merely provides the authority under which an industry can develop regulations to fit its own situation and solve its own marketing problems.' United States Department of Agriculture, Marketing Agreements and Orders, AMS-230 (rev. ed. 1961), 3. See also United States Department of Agriculture, Agricultural Adjustment 1937-1938 (1939), 71.
23
Second, the very terms of the statute require that the Secretary promulgate marketing orders 'limited in their application to the smallest regional production areas' which he finds practicable; and the orders are to 'prescribe such different terms, applicable to different production areas and marketing areas' as will serve to 'give due recognition to the differences in production and marketing' between those areas. 7 U.S.C. § 608c(11). While this language is not conclusive on the question before us, it indicates that Congress contemplated-quite by contrast to the design embodied in the Tobacco Inspection Act-that there might be widespread regional variations in the standards governing production and processing. Thus avocado growers in another region could, for example, propose-and the Secretary would presumably adopt-maturity regulations which would gauge the marketability of the fruit not by the calendar, as do the South Florida rules, but by the color of the skin, or the texture and color of the seed-coat, or perhaps even by oil content. Thus if the Congress of 1935 really intended that distribution would be comprehensively governed by grower-adopted quality and maturity standards, and all state regulation of the same subject would be ousted, it does not seem likely that the statute would have invited local variations at the production end while saying absolutely nothing about the effect of those production controls upon distribution for consumption.
24
A third factor which strongly suggests that Congress did not mandate uniformity for each marketing order arises from the legislative history. The provisions concerning the limited duration and local application of marketing agreements received much attention from both House and Senate Committees reporting on the bill. Though recognizing that the powers conferred upon the Secretary were novel and extensive, both Committees concluded: 'These and other restrictive provisions are * * * adequately drawn to guard against any fear that the regulatory power is so broad as to subject its exercise to the risk of abuse.' H.R.Rep. No. 1241, 74th Cong., 1st Sess. 7; S.Rep. No. 1011, 74th Cong., 1st Sess. 3. The Committee Reports also discussed § 10(i), 7 U.S.C. § 610(i), which authorized federal-state cooperation in the administration of the program, and cautioned significantly:
25
'Notwithstanding the authorization of cooperation contained in this section, there is nothing in it to permit or require the Federal Government to invade the field of the States, for the limitations of the act and the Constitution forbid federal regulation in that field, and this provision does not indicate the contrary. Nor is there anything in the provision to force States to cooperate. Each sovereignty operates in its own sphere but can exert its authority in conformity rather than in conflict with that of the other.' H.R.Rep. No. 1241, 74th Cong., 1st Sess. 22-23; S.Rep.No. 1011, 74th Cong., 1st Sess. 15.
26
Thus the revealed congressional design was apparently to do no more than to invite farmers and growers to get together, under the auspices of the Department of Agriculture, to work out local harvesting, packing and processing programs and thereby relieve temporarily depressed marketing conditions. Had Congress meant the Act to have in addition a pervasive effect upon the ultimate distribution and sale of produce, evidence of such a design would presumably have accompanied the statute, as it did the Tobacco Inspection Act, see Campbell v. Hussey, supra. In the absence of any such manifestations, it would be unreasonable to infer that Congress delegated to the growers in a particular region the authority to deprive the States of their traditional power to enforce otherwise valid regulations designed for the protection of consumers.
27
An examination of the operation of these particular marketing orders reinforces the conclusion we reach from this analysis of the terms and objectives of the statute. The regulations show that the Florida avocado maturity standards are drafted each year not by impartial experts in Washington or even in Florida, but rather by the South Florida Avocado Administrative Committee, which consists entirely of representatives of the growers and handlers concerned. It appears that the Secretary of Agriculture has invariably adopted the Committee's recommendations for maturity dates, sizes, and weights.16 Thus the pattern which emerges is one of maturity regulations drafted and administered locally by the growers' own representatives, and designed to do no more than promote orderly competition among the South Florida growers.17
28
This case requires no consideration of the scope of the constitutional power of Congress to oust all state regulation of maturity, and we intimate no view upon that question.18 It is enough to decide this aspect of the present case that we conclude that Congress has not attempted to oust or displace state powers to enact the regulation embodied in § 792. The most plausible inference from the legislative scheme is that the Congress contemplated that state power to enact such regulations should remain unimpaired.
II.
29
We turn now to appellants' arguments under the Equal Protection and Commerce Clauses.
30
It is enough to dispose of the equal protection claim that we express our agreement with the District Court that the state standard does not work an 'irrational discrimination as between persons or groups of persons, Goesaert v. Cleary, 335 U.S. 464, 466, 69 S.Ct. 198, 93 L.Ed. 163; cf. Railway Express Agency, Inc., v. New York, 336 U.S. 106, 69 S.Ct. 463, 93 L.Ed. 533. While it may well be that arguably superior tests of maturity could be devised, we cannot say, in derogation of the findings of the District Court, that this possibility renders the choice made by California either arbitrary or devoid of rational relationship to a legitimate regulatory interest. Whether or not the oil content test is the most reliable indicator of marketability of avocados is not a question for the courts to decide; it is sufficient that on this record we should conclude, as we do, that oil content appears to be an acceptable criterion of avocado maturity.
31
More difficult is the claim that the California statute unreasonably burdens or discriminates against interstate commerce because its application has excluded Florida avocados from the State. Although Florida and California were competitors in avocado production when the statute was passed in 1925, the present record permits no inference that the California statute had a discriminatory objective.19 Nevertheless it may be that the continued application of this regulation to Florida avocados has imposed an unconstitutional burden on commerce, or has discriminated against another State's exports of the particular commodity. Other state regulations raising similar problems have been found to be discriminatory or burdensome notwithstanding a legitimate state interest in some form of regulation-either because they exceeded the limits necessary to vindicate that interest, Dean Milk Co. v. Madison, 340 U.S. 349, 71 S.Ct. 295, 95 L.Ed. 329, or because they unreasonably favored local producers at the expense of competitors from other States, Baldwin v. G.A.F. Seelig, Inc., 294 U.S. 511, 55 S.Ct. 497, 79 L.Ed. 1032. Such a state regulation might also constitute an illegitimate attempt to control the conduct of producers beyond the borders of California, cf. Bibb v. Navajo Freight Lines, Inc., supra; Southern Pacific Co. v. Arizona, 325 U.S. 761, 775, 65 S.Ct. 1515, 1523, 89 L.Ed. 1915.
32
The District Court referred to these precedents but nevertheless concluded that the California oil content test was not burdensome upon or discriminatory against interstate commerce. 197 F.Supp., at 786-787. However, we are unable to review that conclusion or decide whether the court properly applied the principles announced in these decisions because we cannot ascertain what constituted the record on which the conclusion was predicated. Much of the appellants' offered proof consisted of depositions and exhibits, designed to detail both the rejection of Florida avocados in California and the oil content of Florida avocados which had met the federal test but which might nonetheless have been excluded from California markets The parties' own assumptions concerning the content of the record are in irreconcilable conflict: the appellants have argued the case on the apparent assumption that the depositions and exhibits were admitted before the District Court; the appellees, on the other hand, have assumed both in their briefs and in oral argument that the disputed evidence was not admitted. This lack of consensus is altogether understandable in light of the confusion created by the District Court's evidentiary rulings. The appellees objected to the introduction of the disputed materials on several grounds, both during and after the trial. The court expressly reserved its rulings on the issue of admissibility, and after the entry of its order on the merits of the case made a supplemental 'ruling on evidentiary matters,' in which it stated that the disputed exhibits and depositions 'are not admitted into evidence, but have been considered by the Court as an offer of proof by the plaintiffs * * *.' The earlier memorandum of the court explained that it would 'assume, arguendo, that the exhibits and depositions offered by plaintiffs are all admissible.' 197 F.Supp., at 782. If this was intended to mean that appellants would not have made out a case for relief, even were the evidence to be admitted, then there would have been no need to rule on admissibility. But we are unable to determine, just as the parties were unable to agree, whether the District Court viewed the evidence in that posture.20
33
Thus the only evidence which would seem to support an injunction on the ground of burden on interstate commerce has never been formally admitted to the record in this case. For this Court to reverse and order an injunction on the basis of that evidence would be, in effect, to admit the contested depositions and exhibits on appeal without ever affording the appellees an opportunity to argue their seemingly substantial objections.21 To assume the admissibility of the evidence under these circumstances would be to deny the appellees their day in court as to a disputed part of the case on which the trial court has never ruled because its view of the law evidently made such a ruling unnecessary. Cf. Byrd v. Blue Ridge Rural Electric Cooperative, Inc., 356 U.S. 525, 533, 78 S.Ct. 893, 898, 2 L.Ed.2d 953; Fountain v. Filson, 336 U.S. 681, 69 S.Ct. 754, 93 L.Ed. 971; Globe Liquor Co. v. San Roman, 332 U.S. 571, 68 S.Ct. 246, 92 L.Ed. 177. On the other hand, to affirm the District Court would require us to make equally impermissible assumptions as to the state of the record. Cf. State of Florida v. United States, 282 U.S. 194, 215, 51 S.Ct. 119, 125, 75 L.Ed. 291.
34
For these reasons we conclude that the judgment must, to the extent appealed from in No. 45, be reversed and the case remanded to the District Court for a new trial of appellants' Commerce Clause contentions. We intimate no view with respect to either the admissibility or the probative value of the disputed evidence, or of any other evidence which might be brought forty by either party concerning this aspect of the case
III.
35
In No. 49, the state officers cross-appeal on the ground that the District Court should have dismissed the action for want of equity, rather than for lack of merit. Their contention is that there was insufficient showing of injury to the Florida growers to invoke the District Court's equity jurisdiction. We reject that contention, and affirm the judgment insofar as it is challenged by the cross-appeal.
36
In Florida Lime & Avocado Growers, Inc., v. Jacobsen, 362 U.S. 73, 80 S.Ct. 568, 4 L.Ed.2d 568, we held that because of the Florida growers' allegations that California officials had consistently condemned Florida avocados as unfit for sale in California, 'thus requiring appellants (the Florida growers)-to prevent destruction and complete loss of their shipments-to reship the avocados to and sell them in other States', it was evident that 'there is an existing dispute between the parties as to present legal rights amounting to a justiciable controversy which appellants are entitled to have determined on the merits.' 362 U.S., at 85-86, 80 S.Ct. at 576. In view of our mandate in Jacobsen, therefore, the District Court necessarily assumed jurisdiction and heard the case on its merits. Cf. United States v. Haley, 371 U.S. 18, 83 S.Ct. 11, 9 L.Ed.2d 1.
37
Even on the present ambiguous record, we think that the Florida growers have demonstrated sufficient injury to warrant at least a trial of their allegations. In the California officials' briefs below, it was conceded that the Florida growers has suffered damage in the amount of some $1,500 by reason of the enforcement of the statute. Before the bar of this Court, it was conceded that the State, in objecting to the growers' proffered evidence, did not dispute the claim that some shipments of Florida avocados had in fact been rejected by California for failure to comply with the oil content requirement. Indeed, the State conceded in its pleadings before the trial court that rejections of Florida avocados had averaged in recent years as much as 6.4% of the total shipments of Florida fruit into California. While these concessions were not corroborated by statistical proofs at trial, and thus do not form an adequate basis for the entry of a final injunction, they nevertheless supplied an adequate basis, apart from the requirement of our remand, for the District Court's proceeding to trial on the merits.
38
In addition, it is clear that the California officials will continue to enforce the statute against the Florida-grown avocados, for the State's answer to the complaint declared that these officials 'have in the past and now stand ready to perform their duties under their oath of office should they acquire knowledge of violations of the Agricultural Code of the State of California.' Thus the District Court, both on the pleadings before it, and in light of our opinion in Jacobsen, properly heard the remanded case on the merits and did not err in refusing to dismiss for want of equity jurisdiction.
39
The cross-appellants rely upon the court's finding of fact that '(p)laintiffs have neither suffered nor been threatened with irreparable injury.' This finding was, however, adopted pursuant to that court's prior opinion, which stated that '(p)laintiffs' monetary losses as a result of the rejected shipments are not clearly established, but at most do not appear to be over two or three thousand dollars.' 197 F.Supp., at 783-784. We read this finding as importing no more than the District Court's view that whatever harm or damage the Florida growers might have suffered fell short of the 'irreparable injury' requisite for the entry of an injunction against enforcement of the statute.
40
The judgment of the District Court is reversed and the cause is remanded for a new trial limited to appellants claim in No. 45 that the enforcement of § 792 unreasonably burdens or discriminates against interstate commerce. In the respect challenged by the cross-appeal in No. 49, the judgment is affirmed.
41
It is so ordered.
42
Reversed in part and remanded for limited new trial and affirmed in part.
43
Mr. Justice WHITE, with whom Mr. Justice BLACK, Mr. Justice DOUGLAS and Mr. Justice CLARK join, dissenting in No. 45.
44
This is the second time this case has come before the Court. In Florida Lime & Avocado Growers, Inc., v. Jacobsen, 362 U.S. 73, 80 S.Ct. 568, 4 L.Ed. 568, the case was here for review of dismissal of the complaint for want of jurisdiction. The Court reversed and remanded for trial and the case is now here on the merits, after the three-judge District Court refused to enjoin the appellee state officers from enforcing § 792 of the California Agricultural Code against the appellant growers. 197 F.Supp. 780, probable jurisdiction noted, 368 U.S. 964, 965, 82 S.Ct. 439, 437, 7 L.Ed.2d 394. In view of the Court's disposition of the matter today, it is probable that this case like a revenant will return to us within another few Terms with a still more copious record.
45
Appellants grow, package, and market Florida avocados in interstate commerce, subject to the applicable provisions of § 8c of the Agricultural Adjustment Act, as amended, 7 U.S.C. § 608c, and the regulations of the Secretary of Agriculture promulgated thereunder. An average of 6.4% of the Florida avocados shipped to California each year are barred for failure to satisfy the requirements of California Agricultural Code § 792,1 which provides in pertinent part that '(a)ll avocados, at the time of picking and at all times thereafter, shall contain not less than 8 per cent of oil, by weight of the avocado excluding the skin and seed.'2 Appellants based their claim for relief upon the Equal Protection Clause of the Fourteenth Amendment, the Commerce Clause, and the Supremacy Clause. Since we in the minority have concluded that the Agricultural Adjustment Act and regulations promulgated thereunder leave no room for this inconsistent and conflicting state legislation, we reach only the Supremacy Clause issue.
46
The California statute was enacted in 1925, when, according to the District Court, practically all the avocados in the United States came from that State. 197 F.Supp., at 782. The purpose of this legislation was to prevent the marketing of immature avocados, which never ripen properly, but decay or shrivel up and become rubbery and unpalatable after purchase by the consumer.3 Ibid. The effect of marketing immature avocados is to 'cheat the consumer,' and thus have 'a bad (economic) effect upon retailers and producers as a whole, since it increases future sales resistance' against buying avocados. Id., at 783.
47
In 1925, when the state law was enacted, most of the avocados grown in California were, as they are at the present time, from trees derived from Mexican varieties. Such avocados contain at least 8% oil when mature. The Florida avocado growers, however, the only substantial competitors of the California growers, 197 F.Supp., at 787, n. 8, depend in substantial part on trees of non-Mexican parentage. The Florida avocados involved here, hybrid and Guatemalan varieties, may reach maturity and be acceptable for marketing, at least under federal standards, prior to reaching an 8% oil content.4
48
There is expert opinion to the effect that the best gauge of maturity is the percentage of oil contained in the fruit. Id., at 783. California has adopted that physical-chemical test in § 792. There is also expert opinion that the best test of maturity is the date on which the fruit is picked, and its size and weight at such time. Ibid. The United States Secretary of Agriculture has adopted that test for measuring maturity of avocados for ripening, and has specifically rejected as unsatisfactory all physical and chemical tests. Handling of Avocados Grown in South Florida, 19 Fed.Reg. 2418, 2424-2425 (Dept.Agr.Dkt. No. AO-254). The District Court found the California oil test to be of the latter type.
I.
49
The Agricultural Adjustment Act, § 8c, 7 U.S.C. § 608c, provides that, whenever the Secretary 'has reason to believe that the issuance of an order will tend to effectuate the declared policy' of the Act, which is 'to establish and maintain such minimum standards of quality and maturity * * * (for fruit) in interstate commerce as will effectuate * * * (the) orderly marketing of * * * agricultural commodities as will be in the public interest,' § 2(3), 7 U.S.C. § 602(3), he shall give notice for and hold a hearing upon a proposed order. In the case of fruits, § 8c(6)(A) provides that the Secretary may limit or provide methods for the limitation of quality of produce 'which may be marketed in or transported to any or all markets in the current of interstate or foreign commerce * * *', or affecting commerce, during any specified period.
50
Orders proposed by the Secretary under this statute become effective only when approved by a majority of the affected growers. See § 8c(8)-(9). In 1954 the Secretary held hearings and found that a majority of the South Florida avocado growers favored imposition of quality and maturity standards for avocados pursuant to a marketing order promulgated under the Act. 19 Fed.Reg. 3439.5 The order, id., at 3440-3443, as amended (formerly §§ 969.1-969.71), 7 CFR § 915.1-.71, establishes an Avocado Administrative Committee, comprised of South Florida avocado growers and shippers, with the power to recommend marketing regulations to the Secretary relating to quality and maturity standards and prohibiting the marketing of substandard fruits.6 It is specifically contemplated in § .51 that such maturity standards be based on a pickingdate schedule, and other tests are rejected as unsatisfactory. Section .53 provides that exemption from the regular picking-date regulations of § .51 be allowed for portions of avocado crops of particular varieties when they are proved to be mature prior to the prescribed picking date.7 All regulated avocados, including those with so-called picking-date exemption certificates, must be inspected by the Federal-State Inspection Service, a United States Department of Agriculture and Florida Department of Agriculture joint service, and be certified as meeting the prescribed quality and maturity standards before they may be marketed. § .54.8 At various times, other regulations governing Florida avocados have been issued which include more specific quality standards. See 22 Fed.Reg. 6205, 7 CFR §§ 51.3050-51.3053, 51.3058. These quality standards require that the fruit be 'mature,' for all grades of avocados, but, as in the case of the main order, they do not refer to oil content.9 Since 1954, each year the Secretary has issued, maturity regulations fixing the dates when and minimum sizes at which the various varieties of Florida avocados may be packed and shipped.10 These regulations are recommended by the committee, pursuant to 7 CFR §§ 915.50-915.51, approved by the Secretary after consideration and modification if necessary, 7 CFR § 915.52(b), and published in the Federal Register, after which they have the force of law. California Comm'n v. United States, 355 U.S. 534, 542-543, 78 S.Ct. 446, 451-542, 2 L.Ed.2d 470; Standard Oil Co. v. Johnson, 316 U.S. 481, 484, 62 S.Ct. 1168, 1169, 86 L.Ed. 1611; Maryland Cas. Co. v. United States, 251 U.S. 342, 349, 40 S.Ct. 155, 157, 64 L.Ed. 297.
II.
51
The ultimate question for the Court is whether the California law may validily apply to Florida avocados which the Secretary or his inspector says are mature under the federal scheme. We in the minority believe that it cannot, for in our view the California law 'stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.' Hines v. Davidowitz, 312 U.S. 52, 67, 61 S.Ct. 399, 404, 85 L.Ed. 581.11
52
The central and unavoidable fact is that six out of every 100 Florida avocados certified as mature by federal standards are turned away from the California markets as being immature, and are excluded from that State by the application of a maturity test different from the federal measure. Congress empowered the Secretary to provide for the orderly marketing of avocados and to specify the quality and maturity of avocados to be transported in interstate commerce to any and all markets. Although the Secretary determined that these Florida avocados were mature by federal standards and fit for sale in interstate markets, the State of California determined that they were unfit for sale by applying a test of the type which the Secretary had determined to be unsatisfactory. We think the state law has erected a substantial barrier to the accomplishment of congressional objectives.
53
We would hesitate to strike down the California statute if the state regulation touched a phase of the subject matter not reached by the federal law and a claim were nevertheless made that such complementary state regulation is preempted, compare Compbell v. Hussey, 368 U.S. 297, 82 S.Ct. 327, 7 L.Ed.2d 299, with Savage v. Jones, 225 U.S. 501, 32 S.Ct. 715, 56 L.Ed. 1182. But here the Secretary has promulgated a comprehensive and pervasive regulatory scheme for determining the quality and maturity of Florida avocados, pursuant to the statutory mandate to 'effectuate such orderly marketing of such agricultural commodities.' He prescribes in minute detail the standards for the size, appearance, shape, and maturity of avocados. Inspection procedures and, for violation of the regulations, criminal and civil sanctions are provided. No gap exists in the regulatory scheme which would warrant state action to prevent the evils of a no-man's land-at least in relation to the issues presented in this case. Compare International Union v. Wisconsin Board, 336 U.S. 245, 254, 69 S.Ct. 516, 521, 93 L.Ed. 651. No aspects of avocado maturity are omitted under the federal regulations.12 Any additional state regulation to 'supplement' federal regulation would pro tanto supplant it with another scheme, thereby compromising to some degree the congressional policy expressed in the Act.13
54
By contrast, in Parker v. Brown, 317 U.S. 341, 63 S.Ct. 307, 87 L.Ed. 315, upon which appellees seek to rely, the federal agricultural regulatory scheme was partial and incomplete. It was contended that § 8c of the Agricultural Adjustment Act, by its own force, preempted application of the California Agricultural Prorate Act. The Court held that since no marketing order concerning the affected commodities had been promulgated under § 8c, and since the Act's policies therefore must be deemed by the Secretary not to be effectuated by entry into the field, it followed that there was no preemption: 'It is evident, therefore, that the Marketing Act contemplates the existence of state programs at least until such time as the Secretary shall establish a federal marketing program * * *.' Id., at 354, 63 S.Ct. at 315.14 In the case at bar, of course, the Secretary has entered the field with his own comprehensive regulatory program with which the state program conflicts.
55
Nor does the California statute further a distinctive interest of the State different from the one which the federal scheme protects. Compare Huron Portland Cement Co. v. Detroit, 362 U.S. 440, 80 S.Ct. 813, 4 L.Ed.2d 852; Union Brokerage Co. v. Jensen, 322 U.S. 202, 64 S.Ct. 967, 88 L.Ed. 1227. There is no health interest here. The question is, as the District Court recognized, 197 F.Supp., at 782-783, a purely economic one: the marketing of immature avocados, which do not ripen properly after purchase by the consumer but instead shrivel up and decay, has a substantial adverse effect on consumer demand for avocados. According to the testimony of appellees' expert from the California Department of Agriculture, § 792 was 'deemed to be necessary by representatives in the industry due to deplorable marketing conditions'-the sale of immature avocados, which was severely 'damaging the reputation of the industry by providing consumers with undesirable avocado fruits.' Despite the repeated suggestions to this effect in the Court's opinion, there is no indication that the state regulatory scheme has any purpose other than protecting the good will of the avocado industry-such as protecting health or preventing deception of the public-unless as a purely incidental by-product. Similar findings on damage to the industry because some growers marketed immature avocados are contained in the United States Department of Agriculture order which preceded the issuance of the federal regulations. 19 Fed.Reg., at 2419, 2424. These two regulatory schemes have precisely the same purpose, which is purely an economic one; they seek to achieve it, however, by applying different tests to the same avocados.
56
We also believe that the purpose and objective of Congress and of the marketing order promulgated under its authority call for the application of uniform standards of quality, even absent the total occupation of the field by the federal regulatory scheme. See Guss v. Utah Board, 353 U.S. 1, 77 S.Ct. 598, 1 L.Ed.2d 601; Gibbons v. Ogden, 9 Wheat. 1, 6 L.Ed. 23. Lack of uniformity tends to obstruct commerce, to divide the Nation into many markets. When produce is accepted or rejected in different localities depending upon local vagaries, the flow of commerce is inevitably interrupted, hindered, and diminished. In recognition of this need for uniformity, Congress stated at the outset of the Agricultural Adjustment Act:
57
'It is declared that the disruption of the orderly exchange of commodities in interstate commerce * * * destroys the value of agricultural assets which support the national credit structure * * * and burden(s) and obstruct(s) * * * commerce.
58
'It is declared to be the policy of Congress * * * to establish and maintain such minimum standards of quality and maturity and such grading and inspection requirements for agricultural commodities * * * as well effectuate * * * orderly marketing * * *.' §§ 1, 2, 7 U.S.C. §§ 601, 602.
59
The language of the statute is buttressed by the Committee Reports, H.R.Rep.No. 1241, 74th Cong., 1st Sess., at 22; S.Rep. No. 1011, 74th Cong., 1st Sess., at 15, where it is said in explanation of § 10(i) that the Secretary is authorized to negotiate with state authorities in order to secure their voluntary compliance in carrying out the declared policy of the Act f uniformity of regulatory programs.
60
The contention is made that § 8c(11) negatives the policy declaration that uniformity is sought by the Act. That section directs the Secretary to issue orders limited to as small a geographic region as practicable in order to insure that due recognition be accorded to local conditions of soil, climate, and the like. This provision recognizes that while uniformity at the market-end of the flow of commerce may be necessary to prevent burdens on commerce in produce, nationwide uniformity may be neither necessary nor desirable at the production-end of the flow of commerce. It may be, as the Court suggests, that the Secretary might find for other avocado growing regions, if there were any, that different tests furnished the most convenient index of maturity for those avocados. But it does not follow from this premise that the statutory scheme will permit equally varied standards in the Nation's various market places. Section 8c(11) does not contemplate such regional variations not would they comport with the statutory purpose. It may not obstruct or burden commerce to admit avocados into commerce on diverse bases in different parts of the country; any individual grower in that situation would face but one standard. But it does burden commerce and frustrate the congressional purpose when each grower faces different standards in different markets. To slip from permissible nonuniformity at one end of the stream of commerce to permissible nonuniformity at the other end thus is to read the statute too casually and gloss over the congressional purpose, which expressly was to facilitate marketing in and transportation to 'any and all markets in the current of interstate commerce.'
61
It is also suggested that the use of the term 'minimum standards' indicates a lack of desire for uniformity. This reads too much into a phrase, for it is a commonplace that when the appropriate federal regulatory agency adopts minimum standards which on balance satisfy the needs of the subject matter without disproportionate burden on the regulatees, the balance struck is not to be upset by the imposition of higher local standards. See for example Southern R. Co. v. Railroad Comm'n, 236 U.S. 439, 35 S.Ct. 304, 59 L.Ed. 661. And when the cumulative operation of more strict local law is to be continued in such circumstances, despite the congressional balance struck, Congress has so provided in express terms. For example, in Rice v. Board of Trade, 331 U.S. 247, 255, 67 S.Ct. 1160, 1164, 91 L.Ed. 1468, it was noted that the federal statute provided that 'nothing in this section or section 4b shall be construed to impair any State law applicable to any transaction enumerated or described in such sections.' See, to the same effect, Plumley v. Massachusetts, 155 U.S. 461, 15 S.Ct. 154, 39 L.Ed. 223; Cloverleaf Butter Co. v. Patterson, 315 U.S. 148, 161-162, 62 S.Ct. 491, 498-499, 86 L.Ed. 754.
62
Nothing in the Act, marketing order, or legislative history shows any congressional intention to accommodate or permit state controls inconsistent with federal law or marketing orders issued thereunder. The authorization contained in § 10(i) to seek the cooperation of state authorities in pursuit of the goal of uniform standards of quality and maturity carries no implication that state standards contrary to the federal are to stand. The Secretary was not directed to defer to any State. The fact is that he did work out a cooperative scheme with the State of Florida where the avocados involved in this case are grown. These avocados, which California rejected, were jointly inspected by federal and state authorities applying the same standards in order to move mature avocados into the stream of interstate commerce. To read into an authorization to the Secretary to cooperate with the States a direction that he cooperate with, or that his regulatory scheme defer to, not only the State directly affected by a marketing order but every other State in which avocados might be sold would clearly frustrate the federal purpose of the orderly marketing of avocados in interstate commerce.
63
We would not, as appellees would have it and as the majority appears to suggest, construe § 10 as limiting the power of the Secretary under § 608c to the issuance of marketing orders which are complementary to and not inconsistent with state regulation.15 The suggestion that the Secretary cooperate with the States should be viewed as was a very similar authorization to the same government official in Rice v. Chicago Board of Trade, 331 U.S. 247, 67 S.Ct. 1160, 91 L.Ed. 1468. There the statute provided that the Secretary of Agriculture 'may cooperate with any department or agency of the Government, any State * * * or political subdivision thereof.' A unanimous Court remarked that this provision supported 'the inference that Congress did not design a regulatory system which excluded stare regulation not in conflict with the federal requirements,' but it was careful to note that 'it would be quite a different matter if the Illinois Commission adopted rules for the Board which either violated the standards of the Act or collided with rules of the Secretary.'
64
The conflict between federal and state law is unmistakable here. The Secretary asserts certain Florida avocados are mature. The state law rejects them as immature. And the conflict is over a matter of central importance to the federal scheme. The elaborate regulatory scheme of the marketing order is focused upon the problem of moving mature avocados into interstate commerce. The maturity regulations are not peripheral aspects of the federal scheme. Compare International Assn. of Machinists v. Gonzales, 356 U.S. 617, 78 S.Ct. 923, 2 L.Ed.2d 1018. On the contrary, in the Department of Agriculture order which preceded issuance of the avocado regulations, it was found that the marketing of immature avocados was one of the principal problems, if not the principal problem, faced by the industry and that there regulations should be adopted to solve this problem which was demoralizing the industry. 19 Fed.Reg., at 2419, 2424.16 The conflict involved in this case therefore cannot properly be deemed 'too contingent, too remotely related to' (356 U.S., at 621, 78 S.Ct., at 925) the policy and purpose of the Act of call for requiring the inconsistent state scheme to defer or be accommodated to the federal one.
65
California nevertheless argues that it should be permitted to apply its oil test cumulatively with the federal test to insure that only mature avocados are offered in its markets. The Court accepts this contention as 'a well-settled proposition, in the name of Cloverleaf Butter Co. v. Patterson, 315 U.S. 148, 62 S.Ct. 491, and the uncited 'all the authorities,' which appear to be nonexistent, ante, p. 144, and n. 13. There are at least three answers to this contention.17 First, it ignores the limitations of the 8% oil test as applied to the inherently less oily Florida avocados, which the District Court indicated were 'acceptable prior to the time that they reach that content.' As applied to California avocados, the 8% oil figure leaves an ample tolerance for individual variation, but it is otherwise as applied to the less oily Florida varieties. Second, if the argument is that the federal test is unsatisfactory and that the California test is a better one-as it would appear to be in view of the reliance on 'a higher standard,' which in this case means only a more accurate standard because no one asserts that some avocados can be less highly mature than others and therefore ripen less fully-it must be remembered that the Secretary, to whom Congress delegated its power, made a legislative finding in his order adopting the picking-date-size method of determining maturity and specifically rejecting physical chemical tests of the California type. That finding cannot be impeached collaterally in this proceeding. Adopting one maturity test rather than another 'is a legislative, not a judicial, choice' and its validity 'is not to be determined by weighing in the judicial scales the merits of the legislative choice and rejecting it if the weight of evidence presented in court appears to favor a different standard.' South Carolina State Highway Dept. v. Barnwell Bros., 303 U.S. 177, 191, 58 S.Ct. 510, 517, 82 L.Ed. 734. See Federal Security Administrator v. Quaker Oats Co., 318 U.S. 218, 63 S.Ct. 589, 87 L.Ed. 724; United States v. Carolene Products Co., 304 U.S. 144, 58 S.Ct. 778, 82 L.Ed. 1234. Neither California nor this Court has any place second-guessing the wisdom of Congress or its delegate. Third, Congress did not limit its interest to the picking of avocados, nor even to their transportation in commerce to markets in other States. It expressly declared its intention to regulate the maturity and quality of produce 'which may be marketed in * * * any and all interstate markets.' Congress sought to regulate marketing from the beginning through the end of the stream of commerce, in order to eliminate impediments at any part of that stream. The Court ignores the plain words of the statute in concluding that the California law does not frustrate the federal scheme.
66
Even if the California oil test were an acceptable test for the maturity of the Florida avocados, which the Secretary found it was not, the cumulative application of that test solely for the purpose of a second check on the maturity of Florida avocados, solely to catch possible errors in the federal scheme, would prove only that the particular avocados actually tested (and thereby destroyed) were immature, and it would not justify the rejection of whole lots from which these samples came. If Florida avocados are to be subjected to this test, the alternatives are to leave the California market to the California producers (at least, to producers of Mexican varieties) or else, in order to avoid the hazard of rejection, to leave the Florida avocados on the trees past the normal (and federally prescribed) picking date, thereby shortening the post-picking marketing period and thus frustrating the federal scheme aimed at moving avocados mature under federal standards into all interstate markets.18 A reasonable balancing of the state and federal interests at stake here requires that the former give way as too insubstantial to warrant frustration of the congressional purpose.
67
We have, then, a case where the federal regulatory scheme is comprehensive, pervasive, and without a hiatus which the state regulations could fill. Both the subject matter and the statute call for uniformity. The conflict is substantial-at least six out of every 100 federally certified avocados are barred for failure to pass the California test19-and it is located in a central portion of the federal scheme. The effect of the conflict is to disrupt and burden the flow of commerce and the sale of Florida avocados in distant markets, contrary to the congressional policy underlying the Act. The State may have a legitimate economic interest in the subject matter, but it is adequately served by the federal regulations and this interest would be but slightly impaired, if at all, by the supersession of § 792.20
68
In such circumstances, the state law should give way; it 'becomes inoperative and the federal legislation exclusive in its application.' Cloverleaf Butter Co. v. Patterson, 315 U.S. 148, 156, 62 S.Ct. 491, 496. Accord, McDermott v. Wisconsin, 228 U.S. 115, 33 S.Ct. 431, 57 L.Ed. 754; Hill v. Florida, 325 U.S. 538, 65 S.Ct. 1373, 89 L.Ed. 1782. The conclusion is inescapable that the California law is an obstacle to the accomplishment and execution of the congressional purposes and objectives, and that the California law and the Agricultural Adjustment Act, as supplemented by the regulations promulgated thereunder, cannot be reconciled and cannot consistently stand together.21 The Court should not allow avocados certified as mature under the federal marketing order to be embargoed by any State because it thinks that they are immature. We would therefore reverse with instructions to grant the injunction requested.
1
Avocados not meeting this standard may not be sold in California. Id., § 784. Substandard fruits are 'declared to be a public nuisance,' and they may be seized, condemned, and abated. Id., § 785. Violators may be punished criminally, id., § 831 ($50 to $500 fine or imprisonment for not more than six months, or both), and by civil penalty action, id., § 785.6 (market value of fruits).
2
The orders are approved by the Secretary pursuant to § 8c of the Agricultural Adjustment Act, 7 U.S.C. § 608c. The basic marketing agreement provisions were initially adopted, in substantially their present form in the 1935 amendments to the Agricultural Adjustment Act, 49 Stat. 750, 753-761. These sections were reenacted in 1937, 50 Stat. 246, as the Agricultural Marketing Agreement Act of 1937, virtually unchanged. Concerning the reasons for the reenactment, and the extent of the changes, see United States Department of Agriculture, Agricultural Adjustment 1937-1938 (1939), 72-73.
3
The evidence in the record concerning the actual effect of the California maturity test upon Florida avocados is sketchy at best. The appellants introduced only one witness, a marketing expert in the United States Department of Agriculture, who testified concerning the relative scientific and other merits of the federal and California maturity tests. He gave no testimony concerning the actual impact of the California regulation upon shipments from Florida. One of appellees' witnesses at trial made cursory references to the fact that California inspectors had rejected and excluded some Florida shipments, but there was no testimony concerning the dates and quantities of any rejections. In a motion for dismissal and an accompanying affidavit before the District Court, the appellees presented certain figures concerning the percentage of Florida avocados which failed to comply with the California regulation during the years 1954 through 1957. There was, however, neither data for years after 1957 nor statistical proof at the trial which would corroborate these summary figures.
4
See Roche, Regulations for Marketing Avocados in California, in California Avocado Assn. 1937 Yearbook (1937), 88-89, concerning the purpose of the California oil-test statute. It has not been contended that the purpose of this statute is to ensure a certain caloric or nutritional value in avocados which reach the consumer. No health issue has been raised in this case. See 197 F.Supp., at 785-786.
5
See also Church and Chace, Some Changes in the Composition of California Avocados During Growth (U.S. Dept. of Agriculture Bull. No. 1073, 1922), 2; Hodgson, The California Avocado Industry (Calif. Agricultural Extension Service Circular No. 43, 1930), 54-55; Hodges, Immature Avocado Selling Illegal, 111 Pacific Rural Press, Apr. 3, 1926, p. 435. And for a discussion of the particular problems encountered in the marketing of immature avocados in California, see Roche, supra, note 4, at 88-89.
6
The nature of the avocado and its ripening process make it very difficult for any but the expert to gauge its maturity, and an avocado which may appear satisfactory at the time of purchase may later fail to ripen properly because it was prematurely picked. See, e.g., Ruehle, The Florida Avocado Industry (Univ. of Fla. Agr. Expt. Stations Bull. No. 602, 1958), 69; Avocado Maturity Tests, 37 California Citrograph, Dec. 1951, p. 87; Roche, Look Out for Immature Avocados, 87 California Cultivator, Nov. 2, 1940, p. 590; Church and Chace, supra, note 5, at 2.
7
This order is applicable only to avocados grown in the South Florida growing area. The California growers have not adopted a federal marketing order or agreement.
8
The findings of the United States Department of Agriculture, contained in its order determining what terms should be contained in the avocado regulations, were that the marketing of immature fruits increases consumer resistance and materially impairs the marketing of the entire crop, that there was no satisfactory physical or chemical test for determining maturity, and that maturity can satisfactorily be determined by the picking-date-size method. Handling of Avocados Grown in South Florida, 19 Fed.Reg. 2418, 2424-2425.
Each year since 1954, the Secretary has issued maturity regulations fixing the dates upon which each variety of Florida avocados may be picked and shipped. See, e.g., 27 Fed.Reg. 5135-5136, 6705, 8264-8265, 9174-9175, 10090-10091.
9
Section .53 of the regulations, 7 CFR § 969.53, provides that an exemption certificate shall be granted to a grower 'who furnishes proof, satisfactory to the committee, that his avocados of a particular variety are mature prior to the time such variety may be handled under such regulation.' Such a certificate authorizes the recipient to 'handle' the certified fruit, i.e., to 'sell, consign, deliver, or transport avocados within the production area or between the production area and any point outside thereof * * *.' 7 CFR § 969.10.
10
See Traub et al., Avocado Production in the United States (U.S. Dept. of Agriculture Circular No. 620, 1941), 6-8. Occasionally, however, even California growers have experienced difficulty in meeting the oil content requirement, and sizable shipments have had to be destroyed. See Demand for Avocados, 74 California Cultivator Feb. 8, 1930, p. 167; Roche, Look Out for Immature Avocados, 87 California Cultivator, Nov. 2, 1940, p. 590; California Avocado Assn. 1937 Yearbook (1937), 88.
11
Compare Hodgson, The California Avocado Industry (Calif. Agricultural Extension Service Circular No. 43, 1930), 39.
12
See 19 Fed.Reg. 2418, 2424-2425; compare Harding, The Relation of Maturity to Quality in Florida Avocados, 67 Florida State Horticultural Society Proceedings, 276 (1954).
13
It is true that the statute involved in the Cloverleaf case provided that federal law was not intended to displace state laws 'enacted in the exercise of (the States') police powers * * *.' 32 Stat. 193, 21 U.S.C. § 25. But this proviso was presumably intended to do no more than recognize explicitly an accommodation between federal and state interests to which Congress and the decisions of this Court have consistently adhered. Nor did the Court's deference to state regulation rest upon this congressional proviso. Rather, the Court simply considered it a well-settled proposition that a State may impose upon imported foodstuffs 'a higher standard demanded * * * for its consumers.'
14
It might also be argued that the California statute, having been designed to test the maturity only of California avocados, bears no rational relationship to the marketability of Florida fruit. Such a contention would seem untenable, however, in the face of the District Court's express finding of fact, supportable on the testimony before it, that '(a) standard requiring a minimum of 8% of oil in an avocado before it may be marketed is scientifically valid as applied to hybrid and Guatemalan varieties of avocados grown in Florida and marketed in California.' And there is considerable dispute as to the oil content of Florida avocados which have been certified as mature under the federal regulations. See note 21, infra.
15
The marketing agreement provisions were enacted among the 1935 amendments to the Agricultural Adjustment Act, 49 Stat. 750, 753-761. These amendments were accepted by Congress the day following the enactment of the Tobacco Inspection Act, 49 Stat. 731-735.
16
Although the Manager of the Avocado Administrative Committee stated in his deposition (which was neither formally admitted nor excluded by the District Court) that the Secretary had occasionally rejected orders recommended by the Committee, he insisted that as to maturity regulations 'the Secretary has always followed the Committee's recommendations.'
17
Significant with regard to the essentially local nature of the orders and their administration is the testimony in a deposition (on the admissibility of which the District Court did not rule) of the supervising inspector of fruits and vegetables of the Federal and State Agricultural Inspection Service for the South Florida district:
'* * * these regulations from time to time are subject to change at the direction of the Avocado Administrative Committee. Whenever they do change them, Mr. Biggar, the manager of the Avocado Administrative Committee, immediately furnishes the inspection service with copies of the effective rules and changes. There are times when they change them, and when they change them I am the first man to get the changed regulations, because I have to see that the inspectors get the revised regulations issued by the Avocado Administrative Committee.'
For further evidence that the avocado marketing agreement was undertaken chiefly as a 'self-help program,' designed only to regulate South Florida production and ensure maturity of the produce from that growing area, see Krome, The Federal Avocado Marketing Agreement, 67 Florida State Horticultural Society Proceedings 268 (1954).
18
Compare, e.g., Oregon-Washington R. & Nav. Co. v. Washington, 270 U.S. 87, 46 S.Ct. 279, 70 L.Ed. 482; McDermott v. Wisconsin, 228 U.S. 115, 33 S.Ct. 431, 57 L.Ed. 754. See generally Note, Federal Inspection Legislation-A Partial Remedy for Interstate Trade Barriers, 53 Harv.L.Rev. 1185 (1940).
Nor have we any occasion to consider the possible applicability to the Supremacy Clause issue of the provisions of 21 U.S.C. § 341, since neither party has made any reference to that statute either before the District Court or in this Court.
19
The District Court assumed that in 1925 California growers faced no meaningful competition from Florida growers. It appears, however, that the Florida industry was well developed when the California industry was in its infancy, see Collins, The Avocado, A Salad Fruit From the Tropics (U.S. Dept. of Agriculture Bureau of Plant Industry, Bull. No. 77, 1905), 35-36. Not only does there appear to have been vigorous competition between Florida and California producers for all markets in 1925, see Popenoe, The Avocado-California vs. Florida, 61 California Cultivator, Nov. 3, 1923, p. 459; but in some years during the 1920's the Florida production exceeded that of California. See Traub, supra, note 10, at 2. See generally Hodgson, supra, note 5, at 60, 82-83.
The passage of the California statute was immediately and vigorously protested by Florida producers, and a United States Senator from Florida filed an informal complaint with the Department of Agriculture, see, e.g., California Avocado Law Unfair to Florida: New Pacific Coast Maturity Standards Practically Ban All Shipments from this State, 32 Florida Grower, Nov. 7, 1925, pp. 4, 22. See also, id., Nov. 21, 1925, p. 15. Even in California there was contemporaneous recognition that passage of the statute severely restricted the access of Florida growers to the markets at least of Northern California, see Hodgson, The Florida Avocado Industry-A Survey II, 66 California Cultivator, June 26, 1926, pp. 721, 743. And see 80 American Fruit Grower, Feb. 1960, p. 64.
On the other hand, there have been suggestions that neither the adoption nor the application of the California statute reflected any discriminatory or anticompetitive purpose. In some years California growers themselves experience great difficulty meeting the oil content requirement, and sizable shipments must be destroyed-see Demand for Avocados, 74 California Cultivator, Feb. 8, 1930, p. 167; Roche, Look Out for Immature Avocados, 87 California Cultivator, Nov. 2, 1940, p. 590; California Avocado Assn., 1937 Yearbook (1937), 88-even though the oil content of mature California avocados in good years runs substantially above 8%, see Traub, supra, note 10, at 6-8. Moreover, the California Growers' Association has regarded its ability to market Florida fruit during the months when California fruit is not available as strengthening rather than weakening its own market position. See Fourteenth Annual Report of the General Manager of the Calavo Growers of California (1937), 20. Plainly the questions indicated by these conflicting materials can be resolved only at a trial fully developing the Commerce Clause issue.
20
At the very close of the trial, two of the three members of the court offered inconsistent views when appellees' counsel asked for clarification concerning the status of appellants' disputed depositions and exhibits. One member of the court replied that 'your objections stand to every word that is in these depositions here,' while another responded, '(t)hey are all in evidence subject to your objections and the Court will rule on them when it makes its ruling in the case if it is necessary.'
21
Specifically, appellees offered to show that in measuring the oil content of avocados the Florida experimental test procedures did not employ the same equipment as is used in California, the former, so it was contended, extracting less oil than the California equipment would obtain from the same avocado. They claimed that the average variation amounted to a failure of the Florida equipment to remove 2.9% of the oil from the fruit, and, further, that the Florida results were erratic. In addition, appellees asserted that the avocados used in the Florida experiments were not representative of the graded, sized, and inspected fruit that appellants would normally market.
1
There is no question in this case as to whether the California oil content law keeps out of California Florida avocados which pass the federal test. It their motion to dismiss and the accompanying sworn affidavit below, the appellee state officers gave 6.4% as the average rejection figure per year, over a four-year period, basing the percentage on the official records of the California Department of Agriculture. Rejections reached a high of 16.4% in the 1955-1956 season. It is hard to understand the Court's refusal to consider the figures because of the way they entered the record. See ante, p. 136 and n. 3, and p. 157. We believe appellees' sworn statements as to the State's official records are properly before the Court now, and that in any event they will come into the record shortly, since it is clear that on remand the same data will come in via deposition. If the majority actually has any doubt on this score, and believes that accepting as a fact that California rejects six out of every 100 Florida avocados as immature would have an effect on the result, it should remand for further findings on preemption as it does on burden on commerce. The same papers below, and the opinion of the District Court, 197 F.Supp., at 783, reveal that about 5% of the appellants' shipments to California have been rejected for failure to attain the 8% oil content required under California law. The record is silent on the in terrorem effect of the California law on interstate commerce in Florida avocados, and we therefore do not consider it here.
2
Avocados not meeting this standard may not be sold in California, are 'declared to be a public nuisance,' and they may be seized, condemned, and abated. Violators may be punished criminally and by civil penalty action. See ante, p. 134, at n. 1.
3
It is not contended that the purpose of the 8% minimum oil content requirement is for the purpose of insuring a high caloric or other nutritional content in the fruit. No health issue has been raised in this case. Cf. 197 F.Supp., at 785-786. Nor has it been contended at any stage of the proceedings that the statutory purpose is directly to protect local consumers from fraudulent and deceptive practices; moreover, there is no evidence to support that view.
4
'Mexican varieties of avocados contain (generally speaking) the highest oil content of any varieties, when mature. Hybrid varieties attain the next highest oil percentages, and West Indian the lowest. Hybrid varieties generally attain oil content in excess of 8% if left on the trees long enough, but they do not necessarily attain such an oil content by the time that they may be marketed under the Florida Avocado Order. They are mature enough to be acceptable prior to the time that they reach that content, according to plaintiffs' witnesses.' 197 F.Supp., at 783.
While it would appear to be theoretically feasible to determine the proper oil content to gauge maturity for each different variety of avocado, this is highly impracticable, as the District Court pointed out; over 40 varieties of avocado are marketed in Florida. Id., at 785.
5
The findings of the United States Department of Agriculture, contained in its order determining what terms should be contained in the avocado regulations, were that the marketing of immature fruits increases consumer resistance and materially impairs the marketing of the entire crop, that there was no satisfactory physical or chemical test for determining maturity, and that maturity can satisfactorily be determined by the picking-date-size method. Handling of Avocados Grown in South Florida, 19 Fed.Reg. 2418, 2424-2425 (Dept. Agr. Dkt. No. AO-254).
California has a statute similar to the federal law, the California Marketing Act, Cal.Agr.Code §§ 1300.10-1300.29, which allows the Director of Agriculture to promulgate marketing orders when a majority of the affected handlers or producers assent. Id., § 1300.16(a). The purpose of the Act is to restore and maintain adequate purchasing power for California agricultural producers, establish orderly marketing, provide uniform grading, develop new and larger markets and maintain present markets for produce grown within the State, eliminate trade barriers which obstruct the free flow of such produce to the market, and permit the issuance of marketing orders which assure stabilized and orderly distribution of produce. Id., §§ 1300.10, 1300.29; Brock v. Superior Court, 109 Cal.App.2d 594, 598, 241 P.2d 283, 286. The Director promulgated an avocado marketing order in 1960 and it has been upheld as valid in the state courts. Child v. Warne, 194 Cal.App.2d 623, 15 Cal.Rptr. 437.
6
This is the customary method of administering marketing orders under the Act. See, e.g., 7 CFR §§ 905.51, 906.39, 907.51, 907.63, 908.51, 908.63, 909.51, 909.52, 910.51, 910.65, 911.51. In the case of the avocado order, supra, note 5, the Department specifically determined that this would be the appropriate method to administer the regulatory program. 19 Fed.Reg., at 2422-2423.
7
Section .53 provides that such exemption shall be granted under procedural rules approved by the Secretary. Section .52(b) would appear to provide for review of particular determinations before the Secretary, taken by a party aggrieved thereby or taken by the Secretary sua sponte. Exemption under § .53 is allowed only from the picking-date-size standards prescribed under § .51(a) (1), and not from other regulations such as quality (§ .51(a)(2)), container and packaging (§ .51(a)(3)), or grading and labeling (§ .51(a)(4)). And inspection by the Federal-State Inspection Service for these standards and those set out as the terms and conditions of advance release under § .53 is, of course, required.
8
Violation of the order is punishable by a fine of from $50 to $500. 7 U.S.C. § 608c(14). Violations of regulations may also be made punishable by the Secretary by a penalty not to exceed $100. 7 U.S.C. § 610(c).
9
These regulations and others, 7 CFR §§ 51.3055-51.3069, govern in exhaustive detail the size and shape of avocados, their color, skin condition, stem length, and the manner in which they may be shipped.
10
27 Fed.Reg. 5135-5136, 6705, 8265, 9175, 10091; 26 Fed.Reg. 3692, 4928, 5418-5419, 6429, 7694, 8663; 25 Fed.Reg. 5476, 7712, 8903, 9170, 9888; 24 Fed.Reg. 1152, 3105, 4050, 4828, 5824-5825, 6904, 7354, 8444, 9123, 9262; 23 Fed.Reg. 1025-1026, 4351-5352, 5477, 6318, 7344, 7943, 8047, 9056, 9689; 22 Fed.Reg. 3652, 4251-4252, 5680, 6746, 7173-7174, 7357-7358, 8118; 21 Fed.Reg. 3307-3308, 3488, 6329-6330; 20 Fed.Reg. 3427, 4178-4179, 6699-6700, 7876, 8328-8329, 8688; 19 Fed.Reg. 4404-4405, 4601, 4862, 5469, 5966, 5967, 6368, 6604, 6625, 7477. Similar orders have been issued from time to time concerning maturity of imported avocados. See, e.g., 25 Fed.Reg. 5445; 24 Fed.Reg. 4134, 4829, 5825, 5996; 23 Fed.Reg. 4352, 6027; 22 Fed.Reg. 3957; 21 Fed.Reg. 4257.
11
'There is not-and from the very nature of the problem there cannot be-any rigid formula or rule which can be used as a universal pattern to determine the meaning and purpose of every act of Congress. This Court, in considering the validity of state laws in the light of * * * federal laws touching the same subject, has made use of the following expressions: conflicting; contrary to; occupying the field; repugnance; difference; irreconcilability; inconsistency; violation; curtailment; and interference. But none of these expressions provides an infallible constitutional test or an exclusive constitutional yardstick. In the final analysis, there can be no one crystal clear distinctly marked formula. Our primary function is to determine whether, under the circumstances of this particular case, Pennsylvania's law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.' Hines v. Davidowitz, 312 U.S. 52, 67, 61 S.Ct. 399, 404. (Emphasis added.) Compare ante, p. 141.
12
We do not imply that these regulations governing the fitness of avocados in terms of maturity would preclude application of local regulations concerning, for example, bacteria content or DDT content. Cf. Huron Portland Cement Co. v. Detroit, 362 U.S. 440, 80 S.Ct. 813, 4 L.Ed.2d 852. Neither health regulation nor safety considerations, cf. Lyons v. Thrifty Drug Stores Co., 105 Cal.App.2d 844, 234 P.2d 62, are involved in this case. And there is no finding that there is anything fraudulent, deceptive, or unmarketable about a Florida avocado which is mature enough to be introduced into interstate commerce under a federal certificate evidencing its quality. Compare Plumley v. Massachusetts, 155 U.S. 461, 472, 15 S.Ct. 154, 158, 39 L.Ed. 223, quoted ante, p. 144.
13
It was suggested that there is a gap in the federal scheme through which immature avocados may enter commerce bearing an exemption certificate issued 'seemingly * * * in the unfettered discretion of the growers' own 'Committee.' This contention omits the requirement of § .53 that exemption from the normal picking-date-size provisions be allowed only to avocados inspected and proved mature because they satisfied special maturity tests prescribed under procedures approved by the Secretary, and the fact that such avocados carry a federal certificate as to maturity and quality. It also omits the Secretary's general review power over regulatory determinations provided by § .52(b). No contention has been made that actual abuses have occurred under the exemption certificate provisions nor has any basis upon which they may be anticipated been suggested.
14
It also came out, by representation of the Solicitor General as amicus curiae before this Court, that the Department of Agriculture had collaborated in drafting the state raisin program, and had taken other actions which 'must be taken as an expression of opinion by the Department of Agriculture that the state program * * * is consistent with the policies of the Agricultural Adjustment and Agricultural Marketing Agreement Acts.' Id., at 358, 63 S.Ct. at 317. Hence, in holding 'We find no conflict between the two acts (state and federal) and no such occupation of the legislative field by the mere adoption of the (federal) Act, without the issuance of any order by the Secretary putting it into effect, as would preclude the effective operation of the state act,' the Court expressly declared, 'We have no occasion to decide whether the same conclusion would follow if the state program had not been adopted with the collaboration of officials of the Department of Agriculture * * *.' Id., at 358, 63 S.Ct. at 317.
15
We note that § 1300.24(b) of the California Agricultural Code contains a provision similar to federal § 10(i):
'The director is hereby authorized to confer with and cooperate with the legally constituted authorities of other States and of the United States, for the purpose of obtaining uniformity in the administration of Federal and State marketing regulations, licenses or orders, and said director is authorized to conduct joint hearings, issue joint or concurrent marketing orders, for the purposes and within the standards set forth in this act, and may exercise any administrative authority prescribed by this act to effect such uniformity of administration and regulation.'
Under the reasoning suggested to us the California law should be construed not to apply to Florida avocados marketed under a federal order. And see Local No. 8-6, etc., Oil Workers Union v. Missouri, 361 U.S. 363, 370, 80 S.Ct. 391, 396, 4 L.Ed.2d 373; Allen-Bradley Local v. Wisconsin Board, 315 U.S. 740, 746, 62 S.Ct. 820, 824, 86 L.Ed. 1154; Pearson v. Probate Court, 309 U.S. 270, 277, 60 S.Ct. 523, 527, 84 L.Ed. 744; Carey v. South Dakota, 250 U.S. 118, 122, 39 S.Ct. 403, 404, 63 L.Ed. 886.
16
'Probably the most important single factor of quality is that of maturity.' 19 Fed.Reg., at 2424.
17
To the extent that this contention is to be understood to be limited to 'all the authorities' supporting 'a higher standard for consumers,' we have already indicated, pp. 168-169, supra, that the California law is not aimed at consumer protection but at avocado grower protection.
18
The avocado may remain hard and in perfect condition on the tree for some time after reaching maturity, for the fruit does not soften until after it is picked. But the harvesting and shipping of fruit which has reached the fullest possible degree of maturity on the tree is not recommended. The seed may sprout while the fruit is on the tree or the fruit may ripen so rapidly after harvesting that it cannot be shipped satisfactorily. Ruehle, The Florida Avocado Industry, 70 (Univ. of Fla. Agr. Expt. Sta. Bull. No. 602, 1958); Wolfe, Toy and Stahl, Avocado Production in Florida, 83 (Ruehle rev. ed., Fla., Agr. Ext. Serv. Bull. No. 141, 1949).
19
There is no indication in the record as to how many Florida avocados are kept out of the California market by the prudence of growers and handlers who voluntarily avoid the risks of the California oil test. Nor are we advised as to whether other States have adopted avocado legislation, so that the cumulative burden on commerce is further increased. In any event, 6% is a not insubstantial figure in terms of restraints upon commerce.
20
It is suggested that the regulations involved here are 'simply schemes for regulating competition among growers * * * initiated and administered by the growers and shippers themselves.' From this proposition it is in some way reasoned that 'the self-help standards of this marketing program' should not be deemed to preclude application of state law which conflicts with and interferes with the operation of the comprehensive federal marketing program. The 'simply' part of the proposition overlooks, however, the fact that these are the Secretary's regulations, promulgated under congressional authority. It also overlooks the Secretary's extensive supervisory powers and his statutory duty under 7 U.S.C. § 602(3) to insure that regulations be carried on 'in the public interest.' And no case has been cited to us which indicates that the delegation to the regulatees of the power to propose regulations in the first instance violates any provision of general law. See Parker v. Brown, 317 U.S. 341, 352, 63 S.Ct. 307, 314, 87 L.Ed. 315; Sunshine Anthracite Coal Co. v. Adkins, 310 U.S. 381, 60 S.Ct. 907, 84 L.Ed. 1263; United States v. Rock Royal Co-op., 307 U.S. 533, 577-578, 59 S.Ct. 993, 1014-1015, 83 L.Ed. 1446; Currin v. Wallace, 306 U.S. 1, 16, 59 S.Ct. 379, 387, 83 L.Ed. 441; Johnson & Co. v. Securities & Exchange Comm'n, 198 F.2d 690, 695 (C.A.2d Cir.).
21
And see Castle v. Hayes Lines, Inc., 348 U.S. 61, 75 S.Ct. 191, 899 L.Ed. 68; First Iowa Hydro-Elec. Coop. v. Federal Power Comm'n, 328 U.S. 152, 66 S.Ct. 906, 90 L.Ed. 1143; Gibbons v. Ogden, 9 Wheat. 1, 6 L.Ed. 23; Dumont Labs v. Carroll, 184 F.2d 153 (C.A.3d Cir.). The suggestion, ante, p. 141, that the doctrine of Gibbons v. Ogden is limited to carriers is unwarranted in view of such cases as First Iowa.
| 78
|
373 U.S. 113
83 S.Ct. 1158
10 L.Ed.2d 235
BROTHERHOOD OF RAILWAY AND STEAMSHIP CLERKS, FREIGHT HANDLERS, EXPRESS AND STATION EMPLOYES, et al., Petitioners,v.Anna Mae ALLEN et al.
No. 316.
Argued March 25, 1963.
Decided May 13, 1963.
[Syllabus from pages 113-115 intentionally omitted]
Milton Kramer, Washington, D.C., for petitioners.
Whiteford S. Blakeney, Charlotte, N.C., for respondents.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
By the terms of an agreement (the Agreement) authorized by § 2 Eleventh of the Railway Labor Act1 between the Southern Railway Company and a number of railway labor organizations including the two petitioners herein, employees of Southern are obligated, as a condition of employment, to pay the periodic dues, initiation fees and assessments uniformly required as a condition of acquiring or retaining membership in the union representing their particular class or craft.2 The individual respondents herein are a number of such employees belonging to classes or crafts represented by petitioners.3 When the Agreement was adopted respondents were not union members. They refused to pay petitioners any part of the moneys required under the Agreement, instead bringing this action in the Superior Court of Mecklenburg County, North Carolina, to restrain its enforcement.4 After a trial the Superior Court granted an injunction upon the jury's separate findings that moneys exacted under the Agreement were used by petitioners for purposes not reasonably necessary or related to collective bargaining, namely, (1) to support or oppose legislation, (2) to influence votes in elections for public office, (3) to make campaign contributions in such elections, (4) to support the death-benefits system operated by petitioner Brotherhood of Railway Clerks. The injunction restrained petitioners 'from placing any compulsion of any nature upon the (respondents) * * * whereby they * * * against their free will and choice would be required to join the Defendant Unions * * * or pay money to said Unions.' It was provided, however, that upon a showing by petitioners of the proportion of expenditures from exacted funds that was reasonably necessary and related to collective bargaining, the injunction would be modified appropriately.
2
On appeal, the Supreme Court of North Carolina reversed, Allen v. Southern R. Co., 249 N.C. 491, 107 S.E.2d 125, holding that judgment for petitioners was required by our decision in Railway Employes' Dept. v. Hanson, 351 U.S. 225, 76 S.Ct. 714, 100 L.Ed. 1112, where we held that § 2 Eleventh was a valid exercise by Congress of its powers under the Commerce Clause and did not violate the First Amendment or the Due Process Clause of the Fifth. However, rehearing was granted, and pending decision thereon we decided International Assn. of Machinists v. Street, 367 U.S. 740, 81 S.Ct. 1784, 6 L.Ed.2d 1141. Upon reconsideration of the Superior Court's judgment in the light of that decision, the Supreme Court of North Carolina divided equally, which had the effect of affirming the lower court's judgment. 256 N.C. 700, 124 S.E.2d 871 (per curiam); see Schoenith v. Town & Country Realty Co., 244 N.C. 601, 94 S.E.2d 592 (per curiam); Ward v. O'Dell Mfg. Co., 126 N.C. 946, 36 S.E. 194. We granted certiorari, 371 U.S. 875, 83 S.Ct. 147, 9 L.Ed.2d 113, to consider whether the injunction granted by the Superior Court might stand consistently with our decision in Street. We reverse and remand for further proceedings not inconsistent with this opinion.
3
First. We held in Street 'that § 2, Eleventh is to be construed to deny the unions, over an employee's objection, the power to use his exacted funds to support political causes which he opposes.' 367 U.S., at 768—769, 81 S.Ct., at 1800, 6 L.Ed.2d 1141. Respondents' amended complaint alleges that sums exacted under the Agreement 'have been and are and will be regularly and continually used by the defendant Unions to carry on, finance and pay for political activities directly at cross-purposes with the free will and choice of the plaintiffs.' This allegation sufficiently states a cause of action. It would be impracticable to require a dissenting employee to allege and prove each distinct union political expenditure to which he objects; it is enough that he manifests his opposition to any political expenditures by the union.5 But we made clear in Street that 'dissent is not to be presumed—it must affirmatively be made known to the union by the dissenting employee.' 367 U.S., at 774, 81 S.Ct., at 1803, 6 L.Ed.2d 1141.6 At trial, only 14 of the respondents testified that they objected to the use of exacted sums for political causes. No respondent who does not in the course of the further proceedings in this case prove that he objects to such use will be entitled to relief. This is not and cannot be a class action. See note 4, supra. 'The union receiving money exacted from an employee under a union-shop agreement should not in fairness be subjected to sanctions in favor of an employee who makes no complaint of the use of his money for such activities.' 367 U.S., at 774, 81 S.Ct., at 1803, 6 L.Ed.2d 1141.
4
Second. We also held in Street that an injunction relieving dissenting employees of all obligation to pay the moneys due under an agreement authorized by § 2 Eleventh was impermissible. Such employees 'remain obliged, as a condition of continued employment, to make the payments to their respective unions called for by the agreement. Their * * * grievance stems from the spending of their funds for purposes not authorized by the Act in the face of their objection, not from the enforcement of the union-shop agreement by the mere collection of funds.' 367 U.S., at 771, 81 S.Ct., at 1801, 6 L.Ed.2d 1141. The injunction granted by the Superior Court was thus improper, even though it is subject to modification if petitioners come forward and prove the proportion of exacted funds required for purposes germane to collective bargaining. Even such a remedy, we think, 'sweeps too broadly * * * (and) might well interfere with the * * * unions' performance of those functions and duties which the Railway Labor Act places upon them to attain its goal of stability in the industry.' Ibid.
5
It also follows from Street that the Superior Court erred in granting respondents interim relief against compliance with the financial obligations imposed by the Agreement. As a result of this relief none of the respondents has taken any steps toward compliance since the suit was instituted. We think that lest the important functions of labor organizations under the Railway Labor Act be unduly impaired, dissenting employees (at least in the absence of special circumstances not shown here) can be entitled to no relief until final judgment in their favor is entered. Therefore, on remand respondents should be given a reasonable time within which they must pay to the bargaining representative of their class or craft all sums required under the Agreement, including arrears, that are owing; as to any respondent failing to do this, the action must be dismissed.
6
Third. We suggested in Street that among the permissible remedies for dissenting employees were 'an injunction against expenditure for political causes opposed by each complaining employee of a sum, from those moneys to be spent by the union for political purposes, which is so much of the moneys exacted from him as is the proportion of the union's total expenditures made for such political activities to the union's total budget,' and restitution of such a sum already exacted from the complainant and expended by the union over his objection. 367 U.S., at 774—775, 81 S.Ct., at 1803, 6 L.Ed.2d 1141. The necessary predicate for such remedies is a division of the union's political expenditures from those germane to collective bargaining, since only the former, to the extent made from exacted funds of dissenters, are not authorized by § 2 Eleventh. But at trial no evidence was offered by either side, nor was the jury required to make findings, as to the total amount of union expenditures for political purposes, the breakdown of the total union budget according to particular kinds of expenditure, or the proportion of political expenditures in the total union budget of a given period.7 On remand, in order to frame a decree embodying the suggested remedies, two determinations will have to be made: (1) what expenditures disclosed by the record are political; (2) what percentage of total union expenditures are political expenditures. As to (1) we presently intimate no view, see note 7, supra, because here, as in Street, see 367 U.S., at 768—770, 81 S.Ct., at 1799—1801, 6 L.Ed.2d 1141, the courts below made no attempt to draw the boundary between political expenditures and those germane to collective bargaining, and it would be inappropriate for this Court to do so in the first instance and upon the present record. As to (2) the present record is insufficient to enable any calculation.
7
Since the unions possess the facts and records from which the proportion of political to total union expenditures can reasonably be calculated, basic considerations of fairness compel that they, not the individual employees, bear the burden of proving such proportion. Absolute precision in the calculation of such proportion is not, of course, to be expected or required; we are mindful of the difficult accounting problems that may arise. And no decree would be proper which appeared likely to infringe the unions' right to expend uniform exactions under the union-shop agreement in support of activities germane to collective bargaining and, as well, to expend nondissenters' such exactions in support of political activities.
8
Fourth. While adhering to the principles governing remedy which we announced in Street, see 367 U.S., at 771—775, 81 S.Ct., at 1801—1803, 6 L.Ed.2d 1141, we think it appropriate to suggest, in addition, a practical decree to which each respondent proving his right to relief would be entitled. Such a decree would order (1) the refund to him of a portion of the exacted funds in the same proportion that union political expenditures bear to total union expenditures, and (2) a reduction of future such exactions from him by the same proportion. We recognize that practical difficulties may attend a decree reducing an employee's obligations under the unionshop agreement by a fixed proportion, since the proportion of the union budget devoted to political activities may not be constant. The difficulties in judicially administered relief, although not insurmountable (a decree once entered would of course be modifiable upon a showing of changed circumstances), should, we think, encourage petitioner unions to consider the adoption by their membership of some voluntary plan by which dissenters would be afforded an internal union remedy. There is precedent for such a plan.8 If a union agreed upon a formula for ascertaining the proportion of political expenditures in its budget, and made available a simple procedure for allowing dissenters to be excused from having to pay this proportion of moneys due from them under the unionshop agreement, prolonged and expensive litigation might well be averted. The instant action, for example, has been before the courts for 10 years and has not yet run its course. It is a lesson of our national history of industrial relations that resort to litigation to settle the rights of labor organizations and employees very often proves unsatisfactory. The courts will not shrink from affording what remedies they may, with due regard for the legitimate interests of all parties; but it is appropriate to remind the parties of the availability of more practical alternatives to litigation for the vindication of the rights and accommodation of interests here involved.
9
Reversed and remanded.
10
Mr. Justice BLACK, while adhering to the views he expressed in International Ass'n of Machinists v. Street, 367 U.S. 740, 780 797, 81 S.Ct. 1784, 1805—1814, 6 L.Ed.2d 1141, concurs in the judgment and opinion of the Court in this case because he believes both are in accord with the holding and opinion of the Court in the Street case.
11
Mr. Justice GOLDBERG took no part in the consideration or decision of this case.
12
(For opinion of Mr. Justice HARLAN, see 373 U.S. 129, 83 S.Ct. 1167.)
APPENDIX
13
The Trade Union Act of 1913, 2 & 3 Geo. V, c. 30, reads in part as follows:
14
3.—(1) The funds of a trade union shall not be applied, either directly or in conjunction with any other trade union, association, or body, or otherwise indirectly, in the furtherance of the political objects to which this section applies (without prejudice to the furtherance of any other political objects), unless the furtherance of those objects has been approved as an object of the union by a resolution for the time being in force passed on a ballot of the members of the union taken in accordance with this Act for the purpose by a majority of the members voting; and where such a resolution is in force, unless rules, to be approved, whether the union is registered or not, by the Registrar of Friendly Societies, are in force providing—
15
(a) That any payments in the furtherance of those objects are to be made out of a separate fund (in this Act referred to as the political fund of the union), and for the exemption in accordance with this Act of any member of the union from any obligation to contribute to such a fund if he gives notice in accordance with this Act that he objects to contribute; and
16
(b) That a member who is exempt from the obligation to contribute to the political fund of the union shall not be excluded from any benefits of the union, or placed in any respect either directly or indirectly under any disability or at any disadvantage as compared with other members of the union (except in relation to the control or management of the political fund) by reason of his being so exempt, and that contribution to the political fund of the union shall not be made a condition for admission to the union.
17
(2) If any member of a trade union alleges that he is aggrieved by a breach of any rule made in pursuance of this section, he may complain to the Registrar of Friendly Societies, and the Registrar of Friendly Societies, after giving the complainant and any representative of the union an opportunity of being heard, may, if he considers that such a breach has been committed, make such order for remedying the breach as he thinks just under the circumstances; and any such order of the Registrar shall be binding and conclusive on all parties without appeal and shall not be removable into any court of law or restrainable by injunction, and on being recorded in the county court, may be enforced as if it had been an order of the county court. * * *
18
(3) The political objects to which this section applies are the expenditure of money—
19
(a) on the payment of any expenses incurred either directly or indirectly by a candidate or prospective candidate for election to Parliament or to any public office, before, during, or after the election in connexion with his candidature or election; or
20
(b) on the holding of any meeting or the distribution of any literature or documents in support of any such candidate or prospective candidate; or
21
(c) on the maintenance of any person who is a member of Parliament or who holds a public office; or
22
(d) in connection with the registration of electors or the selection of a candidate for Parliament or any public office; or
23
(e) on the holding of political meetings of any kind, or on the distribution of political literature or political documents of any kind, unless the main purpose of the meetings or of the distribution of the literature or documents is the furtherance of statutory objects within the meaning of this Act.
24
The expression 'public office' in this section means the office of member of any county, county borough, district, or parish council, or board of guardians, or of any public body who have power to raise money, either directly or indirectly, by means of a rate.
25
(4) A resolution under this section approving political objects as an object of the union shall take effect as if it were a rule of the union and may be rescinded in the same manner and subject to the same provisions as such a rule.
26
(5) The provisions of this Act as to the application of the funds of a union for political purposes shall apply to a union which is in whole or in part an association or combination of other unions as if the individual members of the component unions were the members of that union and not the unions; but nothing in this Act shall prevent any such component union from collecting from any of their members who are not exempt on behalf of the association or combination any contributions to the political fund of the association or combination.
27
4.—(1) A ballot for the purposes of this Act shall be taken in accordance with rules of the union to be approved for the purpose, whether the union is registered or not, by the Registrar of Friendly Societies, but the Registrar of Friendly Societies shall not approve any such rules unless he is satisfied that every member has an equal right, and, if reasonably possible, a fair opportunity of voting, and that the secrecy of the ballot is properly secured.
28
(2) If the Registrar of Friendly Societies is satisfied, and certifies, that rules for the purpose of a ballot under this Act or rules made for other purposes of this Act which require approval by the Registrar, have been approved by a majority of members of a trade union, whether registered or not, voting for the purpose, or by a majority of delegates of such a trade union voting at a meeting called for the purpose, those rules shall have effect as rules of the union, notwithstanding that the provisions of the rules of the union as to the alteration of rules or the making of new rules have not been complied with.
29
5.—(1) A member of a trade union may at any time give notice, in the form set out in the Schedule to this Act or in a form to the like effect, that he objects to contribute to the political fund of the union, and, on the adoption of a resolution of the union approving the furtherance of political objects as an object of the union, notice shall be given to the members of the union acquainting them that each member has a right to be exempt from contributing to the political fund of the union, and that a form of exemption notice can be obtained by or on behalf of a member either by application at or by post from the head office or any branch office of the union or the office of the Registrar of Friendly Societies.
30
Any such notice to members of the union shall be given in accordance with rules of the union approved for the purpose by the Registrar of Friendly Societies, having regard in each case to the existing practice and to the character of the union.
31
(2) On giving notice in accordance with this Act of his objection to contribute, a member of the union shall be exempt, so long as his notice is not withdrawn, from contributing to the political fund of the union as from the first day of January next after the notice is given, or, in the case of a notice given within one month after the notice given to members under this section on the adoption of a resolution approving the furtherance of political objects, as from the date on which the member's notice is given.
32
6. Effect may be given to the exemption of members to contribute to the political fund of a union either by a separate levy of contributions to that fund from the members of the union who are not exempt, and in that case the rules shall provide that no moneys of the union other than the amount raised by such separate levy shall be carried to that fund, or by relieving any members who are exempt from the payment of the whole or any part of any periodical contributions required from the members of the union towards the expenses of the union, and in that case the rules shall provide that the relief shall be given as far as possible to all members who are exempt on the occasion of the same periodical payment and for enabling each member of the union to know as respects any such periodical contribution, what portion, if any, of the sum payable by him is a contribution to the political fund of the union.
33
SCHEDULE.
34
FORM OF EXEMPTION NOTICE.
Name of Trade Union
35
POLITICAL FUND (EXEMPTION NOTICE).
36
I hereby give notice that I object to contribute to the Political Fund of the Union, and am in consequence exempt, in manner provided by the Trade Union Act, 1913, from contributing to that fund.
37
A.B.
Address
38
day of 10.
39
Mr. Justice HARLAN, concurring in part and dissenting in part.
40
I agree with the reversal of the interim and qualified permanent relief that was granted by the state courts respecting the obligation to pay union dues. But I disagree with what in effect amounts to an affirmance of the state judgment in other respects. I believe that dismissal of this action in its entirety is called for.
41
International Assn. of Machinists v. Street, 367 U.S. 740, 81 S.Ct. 1784, 6 L.Ed.2d 1141, decided only two years ago, stated in unmistakable terms that a plaintiff claiming relief in an action of this kind must show two things: (1) that he had made known to the union the particular political candidates or causes for whose support he did not wish his union dues used; (2) that membership dues had been used for such purposes.
42
The statement of these principles was reinforced on the very same day in Lathrop v. Donohue, 367 U.S. 820, at 845—846, 81 S.Ct. 1826, 1839, 6 L.Ed.2d 1191, the Wisconsin integrated bar case, where a plurality of the Court said:
43
'Even if the demurrer is taken as admitting all the factual allegations of the complaint, even if these allegations are construed most expansively, and even if, like the Wisconsin Supreme Court, we take judicial notice of the political activities of the State Bar, still we think that the issue of impingement upon rights of free speech through the use of exacted dues is no more concretely presented for adjudication than it was in (Railway Employes' Dept. v.) Hanson (351 U.S. 225, 76 S.Ct. 714, 100 L.Ed. 1112). Compare International Association of Machinists v. Street, (ante), 367 U.S., (p.) 740, at pages 747—749, 81 S.Ct., (p.) 1784, at pages 1788 1790, 6 L.Ed.2d 1141. Nowhere are we clearly apprised as to the views of the appellant on any particular legislative issues on which the State Bar has taken a position, or as to the way in which and the degree to which funds compulsorily exacted from its members are used to support the organization's political activities.' See also what follows 367 U.S., at pp. 846—848, 81 S.Ct., at p. 1839, 6 L.Ed.2d 1191.
44
These requirements have not been met in this case. At best all that has been alleged or proved is that the union will expend a part of each respondent's still-unpaid membership dues for so-called political or other purposes not connected with collective bargaining, and that each respondent would object to the use of any part of his dues for matters other than those relating to collective bargaining. None of the respondents who testified could specify any particular expenditure, or even class of expenditure, to which he objected.
45
I do not understand how, consistently with Street, the Court can now hold that 'it is enough that * * * (a union member) manifests his opposition to any political expenditures by the union' (ante, p. 118), or how it can say that in so holding 'we are not inconsistent with' what the plurality was at such pains to point out in Lathrop (albeit in a constitutional context), id., note 5. The truth of the matter is that the Court has departed from the strict substantive limitations of Street and has given them (and, as I see it, also that case's remedial limitations, compare 367 U.S., at 772—775, 778—779, 779—780, 796—797, 81 S.Ct., at 1801—1803, 1805, 1813—1814, 6 L.Ed.2d 1141, with ante, p. 122-123 and Appendix) an expansive thrust which can hardly fail to increase the volume of this sort of litigation in the future.
46
Believing that our decisions should have more lasting power than has been accorded Street, I must respectfully dissent. I would reverse the judgment and remand the case for dismissal of the complaint.
1
Section 2 Eleventh, 45 U.S.C. § 152 Eleventh, provides in part:
'Notwithstanding any other provisions of this chapter, or of any other statute or law of the United States, or Territory thereof, or of any State, any carrier or carriers as defined in this chapter and a labor organization or labor organizations duly designated and authorized to represent employees in accordance with the requirements of this chapter shall be permitted—
'(a) to make agreements, requiring, as a condition of continued employment, that within sixty days following the beginning of such employment, or the effective date of such agreements, whichever is the later, all employees shall become members of the labor organization representing their craft or class: Provided, That no such agreement shall require such condition of employment with respect to employees to whom membership is not available upon the same terms and conditions as are generally applicable to any other member or with respect to employees to whom membership was denied or terminated for any reason other than the failure of the employee to tender the periodic dues, initiation fees, and assessments (not including fines and penalties) uniformly required as a condition of acquiring or retaining membership.'
2
Although the Agreement requires employees to become union members within the 60-day period, in fact petitioners do not insist that employees actually join the union, but regard payment of the uniform exactions required by the Agreement as complete compliance therewith.
3
This action was commenced by 26 such employees but subsequent to the filing of the complaint 11 more were added as plaintiffs by amendment thereto; all 37 are respondents herein. Southern, which was a defendant below but disclaimed interest in the merits of the dispute between the employees and petitioners and did not appeal the Superior Court's judgment, appears in this Court as a respondent. In this opinion, the term 'respondents' refers only to the individual respondents, and excludes Southern.
4
The action was predicated in part on North Carolina's 'right to work' law, which makes the union shop unlawful. N.C.Gen.Stats., §§ 95—78 to 95—84; but see Hudson v. Atlantic Coast Line R. Co., 242 N.C. 650, 89 S.E.2d 441. The complaint sought temporary and permanent injunctive relief on behalf of the named plaintiffs, respondents herein, and all other employees similarly situated, against Southern and every union representing employees of Southern. But the case was nonsuited as to all the defendant unions except petitioners when at trial no proof was offered that any of the plaintiffs belonged to crafts or classes other than those represented by petitioners. Also, the relief granted by the Superior Court in its final judgment was limited to 'the plaintiffs, individually named as such in the caption of this case.' This limitation was obviously proper and indeed required, since the instant 'action is not a true class action, for there is no attempt to prove the existence of a class of workers who had specifically objected to the exaction of dues for political purposes.' International Assn. of Machinists v. Street, 367 U.S. 740, 774, 81 S.Ct. 1784, 1802—1803, 6 L.Ed.2d 1141; see p. 119, infra.
Upon commencement of the instant action, the plaintiffs obtained an ex parte order temporarily restraining enforcement of the union-shop agreement; after hearing, the order was continued in effect pendente lite, although it was subsequently modified to be 'effective only for the protection of persons who are individually named as parties plaintiff herein or who become added by order of court as such within thirty days from date hereof.' Even as modified, such relief was improper. See p. 120, infra.
5
Respondents testified before any evidence of union political expenditures had been introduced and where asked hypothetical questions such as the following: 'If the evidence should show that the money which you might be compelled to pay to the union would be used in part to influence the passage of laws, or to defeat the passage of legislation, or to influence the election of certain candidates and defeat the election of other candidates, what is your position with respect to such uses of your money?' The answer to this particular question was typical of respondents' testimony: 'I am opposed to it. I am opposed to use of my money to influence the passage of laws or effect the election of candidates because I think that as individuals we should have the right to make our own decisions about such matters.' Some plaintiffs, however, testified somewhat more specifically.
In holding respondents' allegations and testimony adequately specific, we are not inconsistent with the plurality opinion in Lathrop v. Donohue, 367 U.S. 820, 845—846, 81 S.Ct. 1826, 1839, 6 L.Ed.2d 1191, where it was observed, in concluding that the question of the constitutionality of the integrated bar was not yet ripe for decision, that '(n)owhere are we clearly apprised as to the views of the appellant on any particular legislative issues on which the State Bar has taken a position * * *.' This observation was made in the context of constitutional adjudication, not statutory as here.
6
Respondents first made known their objection to the petitioners' political expenditures in their complaint filed in this action; however, this was early enough. Street, 367 U.S., at 771, 81 S.Ct., at 1801, 6 L.Ed.2d 1141.
7
We do conclude, however, without necessarily finding all the questions put to the jury proper for the purpose of distinguishing political expenditures from those germane to collective bargaining, see p. 117, supra, or all of the answers adequately supported by the evidence, that the verdict, fairly read, constitutes a finding for which there is adequate support in the record that petitioners use a part of the exacted funds in support of political causes.
8
See Trade Union Act of 1913, 2 & 3 Geo. V, c. 30, reenacted by Trade Disputes and Trade Unions Act, 1946, 9 & 10 Geo. VI, c. 52; Comment, 19 U. of Chi.L.Rev. 371, 381—388 (1952); Rothschild, Government Regulation of Trade Unions in Great Britain: II, 38 Col.L.Rev. 1335, 1360—1366 (1938). Pertinent portions of the Act are set out in an Appendix at the end of this opinion. Although the Act is a legislative solution to the problem of dissenters' rights, it might be possible for unions to adopt the substantial equivalent without legislation; we do not mean to suggest, however, that the Act provides a perfect model for a plan that would conform with the discussion in this opinion and in Street, nor that all aspects of the English Act are essential, for example the actual segregation of political funds, nor that the particular boundary drawn by the Act between political expenditures and those germane to collective bargaining is necessarily sound. It may be noted that one possible solution to the problem of fluctuating union political expenditures, see p. 122, supra, might be adoption by the union of a proportion calculated on the basis not of present political expenditures but projected future such expenditures, so as to anticipate possible fluctuations, with the dissenting employee free to contract out of this proportion of his dues and fees. Alternatively, unions might consider actually fixing a percentage ceiling of political expenditures, from which proportion dissenters could contract out. On the problem of remedies, see generally McAlister, Labor, Liberalism and Majoritarian Democracy, 31 Ford.L.Rev. 661, 687—693 (1963). Cf. Dudra, Approaches to Union Security in Switzerland, Canada, and Columbia, 86 Monthly Lab.Rev. 136 (1963).
| 67
|
373 U.S. 83
83 S.Ct. 1194
10 L.Ed.2d 215
John L. BRADY, Petitioner,v.STATE OF MARYLAND.
No. 490.
Argued March 18 and 19, 1963.
Decided May 13, 1963.
E. Clinton Bamberger, Jr., Baltimore, Md., for petitioner.
Thomas W. Jamison, III, Baltimore, Md., for respondent.
Opinion of the Court by Mr. Justice DOUGLAS, announced by Mr. Justice BRENNAN.
1
Petitioner and a companion, Boblit, were found guilty of murder in the first degree and were sentenced to death, their convictions being affirmed by the Court of Appeals of Maryland. 220 Md. 454, 154 A.2d 434. Their trials were separate, petitioner being tried first. At his trial Brady took the stand and admitted his participation in the crime, but he claimed that Boblit did the actual killing. And, in his summation to the jury, Brady's counsel conceded that Brady was guilty of murder in the first degree, asking only that the jury return that verdict 'without capital punishment.' Prior to the trial petitioner's counsel had requested the prosecution to allow him to examine Boblit's extrajudicial statements. Several of those statements were shown to him; but one dated July 9, 1958, in which Boblit admitted the actual homicide, was withheld by the prosecution and did not come to petitioner's notice until after he had been tried, convicted, and sentenced, and after his conviction had been affirmed.
2
Petitioner moved the trial court for a new trial based on the newly discovered evidence that had been suppressed by the prosecution. Petitioner's appeal from a denial of that motion was dismissed by the Court of Appeals without prejudice to relief under the Maryland Post Conviction Procedure Act. 222 Md. 442, 160 A.2d 912. The petition for post-conviction relief was dismissed by the trial court; and on appeal the Court of Appeals held that suppression of the evidence by the prosecution denied petitioner due process of law and remanded the case for a retrial of the question of punishment, not the question of guilt. 226 Md. 422, 174 A.2d 167. The case is here on certiorari, 371 U.S. 812, 83 S.Ct. 56, 9 L.Ed.2d 54.1
3
The crime in question was murder committed in the perpetration of a robbery. Punishment for that crime in Maryland is life imprisonment or death, the jury being empowered to restrict the punishment to life by addition of the words 'without capital punishment.' 3 Md.Ann.Code, 1957, Art. 27, § 413. In Maryland, by reason of the state constitution, the jury in a criminal case are 'the Judges of Law, as well as of fact.' Art. XV, § 5. The question presented is whether petitioner was denied a federal right when the Court of Appeals restricted the new trial to the question of punishment.
4
We agree with the Court of Appeals that suppression of this confession was a violation of the Due Process Clause of the Fourteenth Amendment. The Court of Appeals relied in the main on two decisions from the Third Circuit Court of Appeals—United States ex rel. Almeida v. Baldi, 195 F.2d 815, 33 A.L.R.2d 1407, and United States ex rel. Thompson v. Dye, 221 F.2d 763—which, we agree, state the correct constitutional rule.
5
This ruling is an extension of Mooney v. Holohan, 294 U.S. 103, 112, 55 S.Ct. 340, 342, 79 L.Ed. 791, where the Court ruled on what nondisclosure by a prosecutor violates due process:
6
'It is a requirement that cannot be deemed to be satisfied by mere notice and hearing if a state has contrived a conviction through the pretense of a trial which in truth is but used as a means of depriving a defendant of liberty through a deliberate deception of court and jury by the presentation of testimony known to be perjured. Such a contrivance by a state to procure the conviction and imprisonment of a defendant is as inconsistent with the rudimentary demands of justice as is the obtaining of a like result by intimidation.'
7
In Pyle v. Kansas, 317 U.S. 213, 215—216, 63 S.Ct. 177, 178, 87 L.Ed. 214, we phrased the rule in broader terms:
8
'Petitioner's papers are inexpertly drawn, but they do set forth allegations that his imprisonment resulted from perjured testimony, knowingly used by the State authorities to obtain his conviction, and from the deliberate suppression by those same authorities of evidence favorable to him. These allegations sufficiently charge a deprivation of rights guaranteed by the Federal Constitution, and, if proven, would entitle petitioner to release from his present custody. Mooney v. Holohan, 294 U.S. 103, 55 S.Ct. 340, 79 L.Ed. 791.' The Third Circuit in the Baldi case construed that statement in Pyle v. Kansas to mean that the 'suppression of evidence favorable' to the accused was itself sufficient to amount to a denial of due process. 195 F.2d, at 820. In Napue v. Illinois, 360 U.S. 264, 269, 79 S.Ct. 1173, 3 L.Ed.2d 1217, we extended the test formulated in Mooney v. Holohan when we said: 'The same result obtains when the State, although not soliciting false evidence, allows it to go uncorrected when it appears.' And see Alcorta v. Texas, 355 U.S. 28, 78 S.Ct. 103, 2 L.Ed.2d 9; Wilde v. Wyoming, 362 U.S. 607, 80 S.Ct. 900, 4 L.Ed.2d 985. Cf. Durley v. Mayo, 351 U.S. 277, 285, 76 S.Ct. 806, 811, 100 L.Ed. 1178 (dissenting opinion).
9
We now hold that the suppression by the prosecution of evidence favorable to an accused upon request violates due process where the evidence is material either to guilt or to punishment, irrespective of the good faith or bad faith of the prosecution.
10
The principle of Mooney v. Holohan is not punishment of society for misdeeds of a prosecutor but avoidance of an unfair trial to the accused. Society wins not only when the guilty are convicted but when criminal trials are fair; our system of the administration of justice suffers when any accused is treated unfairly. An inscription on the walls of the Department of Justice states the proposition candidly for the federal domain: 'The United States wins its point whenever justice is done its citizens in the courts.'2 A prosecution that withholds evidence on demand of an accused which, if made available, would tend to exculpate him or reduce the penalty helps shape a trial that bears heavily on the defendant. That casts the prosecutor in the role of an architect of a proceeding that does not comport with standards of justice, even though, as in the present case, his action is not 'the result of guile,' to use the words of the Court of Appeals. 226 Md., at 427, 174 A.2d, at 169.
11
The question remains whether petitioner was denied a constitutional right when the Court of Appeals restricted his new trial to the question of punishment. In justification of that ruling the Court of Appeals stated:
12
'There is considerable doubt as to how much good Boblit's undisclosed confession would have done Brady if it had been before the jury. It clearly implicated Brady as being the one who wanted to strangle the victim, Brooks. Boblit, according to this statement, also favored killing him, but he wanted to do it by shooting. We cannot put ourselves in the place of the jury and assume what their views would have been as to whether it did or did not matter whether it was Brady's hands or Boblit's hands that twisted the shirt about the victim's neck. * * * (I)t would be 'too dogmatic' for us to say that the jury would not have attached any significance to this evidence in considering the punishment of the defendant Brady.
13
'Not without some doubt, we conclude that the withholding of this particular confession of Boblit's was prejudicial to the defendant Brady. * * *
14
'The appellant's sole claim of prejudice goes to the punishment imposed. If Boblit's withheld confession had been before the jury, nothing in it could have reduced the appellant Brady's offense below murder in the first degree. We, therefore, see no occasion to retry that issue.' 226 Md., at 429—430, 174 A.2d, at 171. (Italics added.) If this were a jurisdiction where the jury was not the judge of the law, a different question would be presented. But since it is, how can the Maryland Court of Appeals state that nothing in the suppressed confession could have reduced petitioner's offense 'below murder in the first degree'? If, as a matter of Maryland law, juries in criminal cases could determine the admissibility of such evidence on the issue of innocence or guilt, the question would seem to be foreclosed.
15
But Maryland's constitutional provision making the jury in criminal cases 'the Judges of Law' does not mean precisely what it seems to say.3 The present status of that provision was reviewed recently in Giles v. State, 229 Md. 370, 183 A.2d 359, appeal dismissed, 372 U.S. 767, 83 S.Ct. 1102, where the several exceptions, added by statute or carved out by judicial construction, are reviewed. One of those exceptions, material here, is that 'Trial courts have always passed and still pass upon the admissibility of evidence the jury may consider on the issue of the innocence or guilt of the accused.' 229 Md., at 383, 183 A.2d, at p. 365. The cases cited make up a long line going back nearly a century. Wheeler v. State, 42 Md. 563, 570, stated that instructions to the jury were advisory only, 'except in regard to questions as to what shall be considered as evidence.' And the court 'having such right, it follows of course, that it also has the right to prevent counsel from arguing against such an instruction.' Bell v. State, 57 Md. 108, 120. And see Beard v. State, 71 Md. 275, 280, 17 A. 1044, 1045, 4 L.R.A. 675; Dick v. State, 107 Md. 11, 21, 68 A. 286, 290. Cf. Vogel v. State, 163 Md. 267, 162 A. 705.
16
We usually walk on treacherous ground when we explore state law,4 for state courts, state agencies, and state legislatures are its final expositors under our federal regime. But, as we read the Maryland decisions, it is the court, not the jury, that passes on the 'admissibility of evidence' pertinent to 'the issue of the innocence or guilt of the accused.' Giles v. State, supra. In the present case a unanimous Court of Appeals has said that nothing in the suppressed confession 'could have reduced the appellant Brady's offense below murder in the first degree.' We read that statement as a ruling on the admissibility of the confession on the issue of innocence or guilt. A sporting theory of justice might assume that if the suppressed confession had been used at the first trial, the judge's ruling that it was not admissible on the issue of innocence or guilt might have been flouted by the jury just as might have been done if the court had first admitted a confession and then stricken it from the record.5 But we cannot raise that trial strategy to the dignity of a constitutional right and say that the deprival of this defendant of that sporting chance through the use of a bifurcated trial (cf. Williams v. New York, 337 U.S. 241, 69 S.Ct. 1079, 93 L.Ed. 1337) denies him due process or violates the Equal Protection Clause of the Fourteenth Amendment.
17
Affirmed.
18
Separate opinion of Mr. Justice WHITE.
19
1. The Maryland Court of Appeals declared, 'The suppression or withholding by the State of material evidence exculpatory to an accused is a violation of due process' without citing the United States Constitution or the Maryland Constitution which also has a due process clause.* We therefore cannot be sure which Constitution was invoked by the court below and thus whether the State, the only party aggrieved by this portion of the judgment, could even bring the issue here if it desired to do so. See New York City v. Central Savings Bank, 306 U.S. 661, 59 S.Ct. 790, 83 L.Ed. 1058; Minnesota v. National Tea Co., 309 U.S. 551, 60 S.Ct. 676, 84 L.Ed. 920. But in any event, there is no cross-petiton by the State, nor has it challenged the correctness of the ruling below that a new trial on punishment was called for by the requirements of due process. In my view, therefore, the Court should not reach the due process question which it decides. It certainly is not the case, as it may be suggested, that without it we would have only a state law question, for assuming the court below was correct in finding a violation of petitioner's rights in the suppression of evidence, the federal question he wants decided here still remains, namely, whether denying him a new trial on guilt as well as punishment deprives him of equal protection. There is thus a federal question to deal with in this Court, cf. Bell v. Hood, 327 U.S. 678, 66 S.Ct. 773, 90 L.Ed. 939, wholly aside from the due process question involving the suppression of evidence. The majority opinion makes this unmistakably clear. Before dealing with the due process issue it says, 'The question presented is whether petitioner was denied a federal right when the Court of Appeals restricted the new trial to the question of punishment.' After discussing at some length and disposing of the suppression matter in federal constitutional terms it says the question still to be decided is the same as it was before: 'The question remains whether petitioner was denied a constitutional right when the Court of Appeals restricted his new trial to the question of punishment.'
20
The result, of course, is that the due process discussion by the Court is wholly advisory.
21
2. In any event the Court's due process advice goes substantially beyond the holding below. I would employ more confining language and would not cast in constitutional form a broad rule of criminal discovery. Instead, I would leave this task, at least for new, to the rule-making or legislative process after full consideration by legislators, bench, and bar.
22
3. I concur in the Court's disposition of petitioner's equal protection argument.
23
Mr. Justice HARLAN, whom Mr. Justice BLACK joins, dissenting.
24
I think this case presents only a single federal question: did the order of the Maryland Court of Appeals granting a new trial, limited to the issue of punishment, violate petitioner's Fourteenth Amendment right to equal protection?1 In my opinion an affirmative answer would be required if the Boblit statement would have been admissible on the issue of guilt at petitioner's original trial. This indeed seems to be the clear implication of this Court's opinion.
25
The Court, however, holds that the Fourteenth Amendment was not infringed because it considers the Court of Appeals' opinion, and the other Maryland cases dealing with Maryland's constitutional provision making juries in criminal cases 'the Judges of Law, as well as of fact,' as establishing that the Boblit statement would not have been admissible at the original trial on the issue of petitioner's guilt.
26
But I cannot read the Court of Appeals' opinion with any such assurance. That opinion can as easily, and perhaps more easily, be read as indicating that the new trial limitation followed from the Court of Appeals' concept of its power, under § 645G of the Maryland Post Conviction Procedure Act, Md.Code, Art. 27 (1960 Cum.Supp.) and Rule 870 of the Maryland Rules of Procedure, to fashion appropriate relief meeting the peculiar circumstances of this case,2 rather than from the view that the Boblit statement would have been relevant at the original trial only on the issue of punishment. 226 Md., at 430, 174 A.2d, at 171. This interpretation is indeed fortified by the Court of Appeals' earlier general discussion as to the admissibility of third-party confessions, which falls short of saying anything that is dispositive of the crucial issue here. 226 Md., at 427—429, 174 A.2d, at 170.3
27
Nor do I find anything in any of the other Maryland cases cited by the Court (ante, p. 89) which bears on the admissibility vel non of the Boblit statement on the issue of guilt. None of these cases suggests anything more relevant here than that a jury may not 'overrule' the trial court on questions relating to the admissibility of evidence. Indeed they are by no means clear as to what happens if the jury in fact undertakes to do so. In this very case, for example, the trial court charged that 'in the final analysis the jury are the judges of both the law and the facts, and the verdict in this case is entirely the jury's responsibility.' (Emphasis added.)
28
Moreover, uncertainty on this score is compounded by the State's acknowledgment at the oral argument here that the withheld Boblit statement would have been admissible at the trial on the issue of guilt.4
29
In this state of uncertainty as to the proper answer to the critical underlying issue of state law, and in view of the fact that the Court of Appeals did not in terms address itself to the equal protection question, I do not see how we can properly resolve this case at this juncture. I think the appropriate course is to vacate the judgment of the State Court of Appeals and remand the case to that court for further consideration in light of the governing constitutional principle stated at the outset of this opinion. Cf. Minnesota v. National Tea Co., 309 U.S. 551, 60 S.Ct. 676, 84 L.Ed. 920.
1
Neither party suggests that the decision below is not a 'final judgment' within the meaning of 28 U.S.C. § 1257(3), and no attack on the reviewability of the lower court's judgment could be successfully maintained. For the general rule that 'Final judgment in a criminal case means sentence. The sentence is the judgment' (Berman v. United States, 302 U.S. 211, 212, 58 S.Ct. 164, 166, 82 L.Ed. 204) cannot be applied here. If in fact the Fourteenth Amendment entitles petitioner to a new trial on the issue of guilt as well as punishment the ruling below has seriously prejudiced him. It is the right to a trial on the issue of guilt 'that presents a serious and unsettled question' (Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 547, 69 S.Ct. 1221, 1226, 93 L.Ed. 1528) that 'is fundamental to the further conduct of the case' (United States v. General Motors Corp., 323 U.S. 373, 377, 65 S.Ct. 357, 359, 89 L.Ed. 311). This question is 'independent of, and unaffected by' (Radio Station WOW v. Johnson, 326 U.S. 120, 126, 65 S.Ct. 1475, 1479, 89 L.Ed. 2092) what may transpire in a trial at which petitioner can receive only a life imprisonment or death sentence. It cannot be mooted by such a proceeding. See Largent v. Texas, 318 U.S. 418, 421—422, 63 S.Ct. 667, 668—669, 87 L.Ed. 873. Cf. Local No. 438 Const. and General Laborers' Union v. Curry, 371 U.S. 542, 549, 83 S.Ct. 531, 536, 9 L.Ed.2d 514.
2
Judge Simon E. Sobeloff when Solicitor General put the idea as follows in an address before the Judicial Conference of the Fourth Circuit on June 29, 1954:
'The Solicitor General is not a neutral, he is an advocate; but an advocate for a client whose business is not merely to prevail in the instant case. My client's chief business is not to achieve victory but to establish justice. We are constantly reminded of the now classic words penned by one of my illustrious predecessors, Frederick William Lehmann, that the Government wins its point when justice is done in its courts.'
3
See Dennis, Maryland's Antique Constitutional Thorn, 92 U. of Pa.L.Rev. 34, 39, 43; Prescott, Juries as Judges of the Law: Should the Practice be Continued, 60 Md.St.Bar Assn.Rept. 246, 253 254.
4
For one unhappy incident of recent vintage see Oklahoma Packing Co. v. Oklahoma Gas & Electric Co., 309 U.S. 4, 60 S.Ct. 215, 84 L.Ed. 447, 537, that replaced an earlier opinion in the same case, 309 U.S. 703.
5
'In the matter of confessions a hybrid situation exists. It is the duty of the Court to determine from the proof, usually taken out of the presence of the jury, if they were freely and voluntarily made, etc., and admissible. If admitted, the jury is entitled to hear and consider proof of the circumstances surrounding their obtention, the better to determine their weight and sufficiency. The fact that the Court admits them clothes them with no presumption for the jury's purposes that they are either true or were freely and voluntarily made. However, after a confession has been admitted and read to the jury the judge may change his mind and strike it out of the record. Does he strike it out of the jury's mind?' Dennis, Maryland's Antique Constitutional Thorn, 92 U. of Pa.L.Rev. 34, 39. See also Bell v. State, supra, 57 Md. at 120; Vogel v. State, 163 Md., at 272, 162 A., at 706 707.
*
Md.Const., Art. 23; Home Utilities Co., Inc., v. Revere Copper & Brass, Inc., 209 Md. 610, 122 A.2d 109; Raymond v. State ex rel. Szydlouski, 192 Md. 602, 65 A.2d 285; County Com'rs of Anne Arundel County v. English, 182 Md. 514, 35 A.2d 135, 150 A.L.R. 842; Oursler v. Tawes, 178 Md. 471, 13 A.2d 763.
1
I agree with my Brother WHITE that there is no necessity for deciding in this case the broad due process questions with which the Court deals at pp. 86—88 of its opinion.
2
Section 645G provides in part: 'If the court finds in favor of the petitioner, it shall enter an appropriate order with respect to the judgment or sentence in the former proceedings, and any supplementary orders as to rearraignment, retrial, custody, bail, discharge, correction of sentence, or other matters that may be necessary and proper.' Rule 870 provides that the Court of Appeals 'will either affirm or reverse the judgment from which the appeal was taken, or direct the manner in which it shall be modified, changed or amended.'
3
It is noteworthy that the Court of Appeals did not indicate that it was limiting in any way the authority of Day v. State, 196 Md. 384, 76 A.2d 729. In that case two defendants were jointly tried and convicted of felony murder. Each admitted participating in the felony but accused the other of the homicide. On appeal the defendants attacked the trial court's denial of a severance, and the State argued that neither defendant was harmed by the statements put in evidence at the joint trial because admission of the felony amounted to admission of guilt of felony murder. Nevertheless the Court of Appeals found an abuse of discretion and ordered separate new trials on all issues.
4
In response to a question from the Bench as to whether Boblit's statement, had it been offered at petitioner's original trial, would have been admissible for all purposes, counsel for the State, after some colloquy, stated: 'It would have been, yes.'
| 01
|
373 U.S. 284
83 S.Ct. 1240
10 L.Ed.2d 349
Nathaniel WRIGHT et al., Petitioners,v.STATE OF GEORGIA.
No. 68.
Argued Nov. 7, 1963.
Decided May 20, 1963.
James M. Nabrit, III, New York City, for petitioners.
Sylvan A. Garfunkel, Savannah, Ga., for respondent.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
Petitioners, six young Negroes, were convicted of breach of the peace for peacefully playing basketball in a public park in Savannah, Georgia, on the early afternoon of Monday, Januay 23, 1961. The record is devoid of evidence of any activity which a breach of the peace statute might be thought to punish. Finding that there is no adequate state ground to bar review by this Court and that the convictions are violative of due process of law secured by the Fourteenth Amendment, we hold that the judgments below must be reversed.
2
Only four witnesses testified at petitioners' trial: the two arresting officers, the city recreational superintendent, and a sergeant of police. All were prosecution witnesses. No witness contradicted any testimony given by any other witnesses. On the day in question the petitioners were playing in a basketball court at Daffin Park, Savannah, Georgia. The park is owned and operated by the city for recreational purposes, is about 50 acres in area, and is customarily used only by whites. A white woman notified the two police officer witnesses of the presence of petitioners in the park. They investigated, according to one officer, 'because some colored people were playing in the park. I did not ask this white lady how old these people were. As soon as I found out these were colored people I immediately went there.' The officer also conceded that 'I have never made previous arrests in Daffin Park because people played basketball there * * *. I arrested these people for playing basketball in Daffin Park. One reason was because they were negroes. I observed the conduct of these people, when they were on the basketball Court and they were doing nothing besides playing basketball, they were just normally playing basketball, and none of the children from the schools were there at that particular time.' The other officer admitted that petitioners 'were not necessarily creating any disorder, they were just 'shooting at the goal,' that's all they were doing, they wasn't disturbing anything.' Petitioners were neat and well dressed. Nevertheless, the officers ordered the petitioners to leave the park. One petitioner asked one of the officers 'by what authority' he asked them to leave; the officer responded that he 'didn't need any orders to come out there * * *.' But he admitted that 'it is (not) unusual for one to inquire 'why' they are being arrested.' When arrested the petitioners obeyed the police orders and without disturbance entered the cruiser to be transported to police headquarters. No crowd assembled.
3
The recreational superintendent's testimony was confused and contradictory. In essence he testified that school children had preference in the use of the park's playground facilities but that there was no objection to use by older persons if children were not there at the time. No children were present at this time. The arrests were made at about 2 p.m. The schools released their students at 2:30 and, according to one officer, it would have been at least 30 minutes before any children could have reached the playground. The officer also stated that he did not know whether the basketball court was reserved for a particular age group and did not know the rules of the City Recreational Department. It was conceded at the trial that no signs were posted in the park indicating what areas, if any, were reserved for younger children at particular hours. In oral argument before this Court it was conceded that the regulations of the park were not printed.
4
The accusation charged petitioners with assembling 'for the purpose of disturbing the public peace * * *.' and not dispersing at the command of the officers. The jury was charged, with respect to the offense itself, only in terms of the accusation and the statute.1 Upon conviction five petitioners were sentenced to pay a fine of $100 or to serve five months in prison. Petitioner Wright was sentenced to pay a fine of $125 or to serve six months in prison.
5
Petitioners' principal contention in this Court is that the breach of the peace statute did not give adequate warning that their conduct violated that enactment in derogation of their rights under the Due Process Clause of the Fourteenth Amendment of the Constitution of the United States. This contention was plainly raised at the trial, both in a demurrer to the accusation and in motions for a new trial, and was pressed on appeal to the Georgia Supreme Court. Both the demurrer and new trial motions raised a number of other issues. The Georgia Supreme Court held that error in the denial of the motions for a new trial could not be considered because it was not properly briefed on the appeal. But the court nevertheless seemed to pass upon the claim because it had been raised in the demurrer,2 and affirmed the convictions. 217 Ga. 453, 122 S.E.2d 737. Certiorari was granted. 370 U.S. 935, 82 S.Ct. 1580, 8 L.Ed.2d 806.
6
Since there is some question as to whether the Georgia Supreme Court considered petitioners' claim of vagueness to have been properly raised in the demurrer,3 we prefer to rest our jurisdiction upon a firmer foundation. We hold, for the reasons set forth hereinafter, that there was no adequate state ground for the Georgia court's refusal to consider error in the denial of petitioners' motions for a new trial.
I.
7
A commentator on Georgia procedure has concluded that '(p)robably no phase of pleading in Georgia is fraught with more technicalities than with respect to raising constitutional issues.'4 Examination of the Georgia cases bears out this assertion. In an extraordinary number an attempt to raise constitutional issues has been frustrated by a holding that the question was not properly raised or pursued. But '(w)hatever springes the State may set for those who are endeavoring to assert rights that the State confers, the assertion of Federal rights, when plainly and reasonably made, is not to be defeated under the name of local practice.' Davis v. Wechsler, 263 U.S. 22, 24, 44 S.Ct. 13, 14, 68 L.Ed. 143. See also Love v. Griffith, 266 U.S. 32, 45 S.Ct. 12, 69 L.Ed. 157; Stromberg v. California, 283 U.S. 359, 51 S.Ct. 532, 75 L.Ed. 1117; Terminiello v. Chicago, 337 U.S. 1, 69 S.Ct. 894, 90 L.Ed. 1131; Staub v. City of Baxley, 355 U.S. 313, 78 S.Ct. 277, 2 L.Ed.2d 302; N.A.A.C.P. v. Alabama ex rel. Patterson, 357 U.S. 449, 78 S.Ct. 1163, 2 L.Ed.2d 1488.
8
In this case the Georgia Supreme Court held that error in the denial of the motions for a new trial could not be considered because '(t)here was no argument, citation of authority, or statement that (the grounds for reversal stated in the new trial motions) * * * were still relied upon.' The court found 'the applicable rule, as laid down in Henderson v. Lott, 163 Ga. 326 (2), 136 S.E. 403, (to be) * * *: 'Assignments of error, not insisted upon by counsel in their briefs or otherwise, will be treated by this court as abandoned. A mere recital in briefs of the existence of an assignment of error, without argument or citation of authorities in its support, and without a statement that it is insisted upon by counsel, is insufficient to save it from being treated as abandoned." 217 Ga., at 454—455, 122 S.E.2d, at 740. Presumably the court was restating the requirements of § 6—1308 of the Georgia Annotated Code of 1935. That section provides: 'All questions raised in the motion for new trial shall be considered by the appellate court except where questions so raised are expressly or impliedly abandoned by counsel either in the brief or upon oral argument. A general insistence upon all the grounds of the motion shall be held to be sufficient.'
9
To ascertain the precise holding of the Georgia court we must examine the brief which the petitioners submitted in connection with their appeal. It specifically assigned as error the overruling of their motions for a new trial. And in the section of the brief devoted to argument it was stated:
10
'Plaintiffs-in-Error had assembled for the purpose of playing basketball and were in fact only playing basketball in a municipally owned park, according to the State's own evidence. Nevertheless, they were arrested and convicted under the said statute which prohibited assemblies for the purpose of 'disturbing the public peace or committing any unlawful act.' Where a statute is so vague as to make criminal an innocent act, a conviction under it cannot be sustained. Murray Winters v. New York, 333 U.S. 507 (68 S.Ct. 665, 92 L.Ed. 840). * * * Plaintiffs-in-Error could not possibly have predetermined from the wording of the statute that it would have punished as a misdemeanor an assembly for the purpose of playing basketball.'
11
Obviously petitioners did in fact argue the point which they press in this Court. Thus the holding of the Georgia court must not have been that the petitioners abandoned their argument but rather that the argument could not be considered because it was not explicitly identified in the brief with the motions for a new trial. In short the Georgia court would require the petitioners to say something like the following at the end of the paragraph quoted above: 'A fortiori it was error for the trial court to overrule the motions for a new trial.' As was said in a similar case coming to us from the Georgia courts, this 'would be to force resort to an arid ritual of meaningless form.' Staub v. City of Baxley, supra, 355 U.S. at 320, 78 S.Ct. at 281. The State may not do that here any more than it could in Staub. Here, as in Staub, the state ground is inadequate. Its inadequacy is especially apparent because no prior Georgia case which respondent has cited nor which we have found gives notice of the existence of any requirement that an argument in a brief be specifically identified with a motion made in the trial court. '(A) local procedural rule, although it may now appear in retrospect to form part of a consistent pattern of procedures * * *, cannot avail the State here, because petitioner(s) could not fairly be deemed to have been apprised of its existence. Novelty in procedural requirements cannot be permitted to thwart review in this Court * * *.' N.A.A.C.P. v. Alabama ex rel. Patterson, supra, 357 U.S. at 457, 78 S.Ct. at 1169. We proceed to a consideration of the merits of petitioners' constitutional claim.
II.
12
Three possible bases for petitioners' convictions are suggested. First, it is said that failure to obey the command of a police officer constitutes a traditional form of breach of the peace. Obviously, however, one cannot be punished for failing to obey the command of an officer if that command is itself violative of the Constitution. The command of the officers in this case was doubly a violation of petitioners' constitutional rights. It was obviously based, according to the testimony of the arresting officers themselves, upon their intention to enforce racial discrimination in the park. For this reason the order violated the Equal Protection Clause of the Fourteenth Amendment. See New Orleans City Park Improvement Ass'n v. Detiege, 358 U.S. 54, 79 S.Ct. 99, 3 L.Ed.2d 46, affirming 5 Cir., 252 F.2d 122. The command was also violative of petitioners' rights because, as will be seen, the other asserted basis for the order—the possibility of disorder by others—could not justify exclusion of the petitioners from the park. Thus petitioners could not constitutionally be convicted for refusing to obey the officers. If petitioners were held guilty of violating the Georgia statute because they disobeyed the officers, this case falls within the rule that a generally worded statute which is construed to punish conduct which cannot constitutionally be punished is unconstitutionally vague to the extent that it fails to give adequate warning of the boundary between the constitutionally permissible and constitutionally impermissible applications of the statute. Cf. Winters v. New York, 333 U.S. 507, 68 S.Ct. 665, 92 L.Ed. 840; Stromberg v. California, 283 U.S. 359, 51 S.Ct. 532, 75 L.Ed. 1117; see also Cole v. Arkansas, 333 U.S. 196, 68 S.Ct. 514, 92 L.Ed. 644.
13
Second, it is argued that petitioners were guilty of a breach of the peace because their activity was likely to cause a breach of the peace by others. The only evidence to support this contention is testimony of one of the police officers that 'The purpose of asking them to leave was to keep down trouble, which looked like to me might start—there were five or six cars driving around the park at the time, white people.' But that officer also stated that this 'was (not) unusual traffic for that time of day.' And the park was 50 acres in area. Respondent contends the petitioners were forewarned that their conduct would be held to violate the statute. See Samuels v. State, 103 Ga.App. 66, 118 S.E.2d 231. But it is sufficient to say again that a generally worded statute, when construed to punish conduct which cannot be constitutionally punished, is unconstitutionally vague. And the possibility of disorder by others cannot justify exclusion of persons from a place if they otherwise have a constitutional right (founded upon the Equal Protection Clause) to be present. Taylor v. Louisiana, 370 U.S. 154, 82 S.Ct. 1188, 8 L.Ed.2d 395; Garner v. Louisiana, 368 U.S. 157, 174, 82 S.Ct. 248, 257, 7 L.Ed.2d 207; see also Buchanan v. Warley, 245 U.S. 60, 80—81, 38 S.Ct. 16, 20, 62 L.Ed. 149.
14
Third, it is said that the petitioners were guilty of a breach of the peace because a park rule reserved the playground for the use of younger people at the time. However, neither the existence nor the posting of any such rule has been proved. Cf. Lambert v. California, 355 U.S. 225, 228, 78 S.Ct. 240, 242, 2 L.Ed.2d 228. The police officers did not inform them of it because they had no knowledge of any such rule themselves. Furthermore, it is conceded that there was no sign or printed regulation which would give notice of any such rule.
15
Under any view of the facts alleged to constitute the violation it cannot be maintained that petitioners had adequate notice that their conduct was prohibited by the breach of the peace statute. It is well established that a conviction under a criminal enactment which does not give adequate notice that the conduct charged is prohibited is violative of due process. Lanzetta v. New Jersey, 306 U.S. 451, 59 S.Ct. 618, 83 L.Ed. 888; Connally v. General Construction Co., 269 U.S. 385, 46 S.Ct. 126, 70 L.Ed. 322; United States v. L. Cohen Grocery Co., 255 U.S. 81, 41 S.Ct. 298, 65 L.Ed. 516; see also United States v. National Dairy Products Corp., 372 U.S. 29, 83 S.Ct. 594, 9 L.Ed.2d 561.
16
Reversed.
1
The statute, Ga.Code Ann., 1953, § 26—5301, provides:
'Unlawful assemblies.—Any two or more persons who shall assemble for the purpose of disturbing the public peace or committing any unlawful act, and shall not disperse on being commanded to do so by a judge, justice, sheriff, constable, coroner, or other peace officer, shall be guilty of a misdemeanor.'
2
The Georgia court refused to consider two of the constitutional claims asserted in the demurrer. But these allegations charged only unconstitutional administration of the statute. It is well settled in Georgia that the constitutionality of the statute upon which the charge is based may be attacked by demurrer. The Georgia Supreme Court, over 65 years ago, held that '(u)nder the general demurrer (to the accusation) the constitutionality of the law under which the accused was arraigned is brought in question.' Newman v. State, 101 Ga. 534, 536, 28 S.E. 1005 (1897). This rule was later qualified to require the defendant to set out the ground of his attack with particularity in the demurrer. See, e.g., Henderson v. Georgia, 123 Ga. 465, 466, 51 S.E. 385, 386. In numerous cases it has been assumed that a constitutional objection on the ground of vagueness may properly be made by demurrer. Teague v. Keith, 214 Ga. 853, 108 S.E.2d 489; Harris v. State, 191 Ga. 243, 12 S.E.2d 64; Carr v. State, 176 Ga. 747, 169 S.E. 201; Dalton v. State, 176 Ga. 645, 169 S.E. 198; Carr v. State, 176 Ga. 55, 166 S.E. 827, 167 S.E. 103; Hughes v. State Board of Medical Examiners, 162 Ga. 246, 134 S.E. 42. See also Henderson v. State, 113 Ga. 1148, 39 S.E. 446. In other cases the Georgia Supreme Court has held that certain procedures, other than a demurrer, do not constitute the proper method to attack the constitutionality of the statute upon which the charge or claim was based. In each of these cases the Georgia court specifically stated that a demurrer would constitute a proper procedural device. Eaves v. State, 113 Ga. 749, 758, 39 S.E. 318, 321; Boswell v. State, 114 Ga. 40, 41, 39 S.E. 897; Hendry v. State, 147 Ga. 260, 265, 93 S.E. 413, 415; Starling v. State, 149 Ga. 172, 99 S.E. 619; Savannah Elec. Co. v. Thomas, 154 Ga. 258, 113 S.E. 806; Moore v. State, 194 Ga. 672, 22 S.E.2d 510; Stone v. State, 202 Ga. 203, 42 S.E.2d 727; Loomis v. State, 203 Ga. 394, 405, 47 S.E.2d 58, 64; Flynt v. Dumas, 205 Ga. 702, 54 S.E.2d 429; Corbin v. State, 212 Ga. 231, 91 S.E.2d 764; Renfroe v. Wallace, 214 Ga. 685, 107 S.E.2d 225.
Respondent does not argue that an adequate state ground exists insofar as petitioners' claim of vagueness was raised in the demurrer.
3
The question arises because of the Georgia rule against speaking demurrers, i.e., demurrers which rely upon facts not stated in the accusation. Though the demur rer itself (in stating the claim of vagueness) did not set forth new facts, petitioners' constitutional claim is established only by considering the State's evidence in connection with the accusation and the statute.
4
Leverett, Hall, Christopher, Davis and Shulman, Georgia Procedure and Practice (1957), 38.
| 12
|
373 U.S. 267
83 S.Ct. 1122
10 L.Ed.2d 338
Rudolph LOMBARD et al., Petitioners,v.STATE OF LOUISIANA.
No. 58.
Argued Nov. 5, 6 and 7, 1962.
Decided May 20, 1963.
John P. Nelson, Jr., New Orleans, La., for petitioners.
Jack P. F. Gremillion, Baton Rouge, La., for respondent.
Archibald Cox, Sol. Gen., for the United States, as amicus curiae, by special leave of Court.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
This case presents for review trespass convictions resulting from an attempt by Negroes to be served in a privately owned restaurant customarily patronized only by whites. However, unlike a number of the cases this day decided, no state statute or city ordinance here forbids desegregation of the races in all restaurant facilities. Nevertheless, we conclude that this case is governed by the principles announced in Peterson v. City of Greenville, 373 U.S. 244, 83 S.Ct. 1119, and that the convictions for this reason must be reversed.
2
Petitioners are three Negro and one white college students. On September 17, 1960, at about 10:30 in the morning they entered the McCrory Five and Ten Cent Store in New Orleans, Louisiana. They sat down at a refreshment counter at the back of the store and requested service, which was refused. Although no sign so indicated, the management operated the counter on a segregated basis, serving only white patrons. The counter was designed to accommodate 24 persons. Negroes were welcome to shop in other areas of the store. The restaurant manager, believing that the 'unusual circumstance' of Negroes sitting at the counter created an 'emergency,' asked petitioners to leave and, when they did not do so, ordered that the counter be closed. The restaurant manager then contacted the store manager and called the police. He frankly testified that the petitioners did not cause any disturbance, that they were orderly, and that he asked them to leave because they were Negroes. Presumably he asked the white petitioner to leave because he was in the company of Negroes.
3
A number of police officers, including a captain and major of police, arrived at the store shortly after they were called. Three of the officers had a conference with the store manager. The store manager then went behind the counter, faced petitioners, and in a loud voice asked them to leave. He also testified that the petitioners were merely sitting quietly at the counter throughout these happenings. When petitioners remained seated, the police major spoke to petitioner Goldfinch, and asked him what they were doing there. Mr. Goldfinch replied that petitioners 'were going to sit there until they were going to be served.' When petitioners still declined to leave, they were arrested by the police, led out of the store, and taken away in a patrol wagon. They were later tried and convicted for violation of the Louisiana criminal mischief statute.1 This statute, in its application to this case, has all the elements of the usual trespass statute. Each petitioner was sentenced to serve 60 days in the Parish Prison and to pay a fine of $350. In default of payment of the fine, each was to serve 60 additional days in prison. On appeal to the Supreme Court of Louisiana the judgments of conviction were affirmed. State v. Goldfinch, 241 La. 958, 132 So.2d 860. Because of the substantial federal questions presented, we granted certiorari. 370 U.S. 935, 82 S.Ct. 1579, 8 L.Ed.2d 805.
4
Prior to this occurrence New Orleans city officials, characterizing conduct such as petitioners were arrested for as 'sit-in demonstrations,' had determined that such attempts to secure desegregated service, though orderly and possibly in-offensive to local merchants, would not be permitted.
5
Exactly one week earlier, on September 10, 1960, a like occurrence had taken place in a Woolworth store in the same city. In immediate reaction thereto the Superintendent of Police issued a highly publicized statement which discussed the incident and stated that 'We wish to urge the parents of both white and Negro students who participated in today's sit-in demonstration to urge upon these young people that such actions are not in the community interest. * * * (W)e want everyone to fully understand that the police department and its personnel is ready and able to enforce the laws of the city of New Orleans and the state of Louisiana.'2 On September 13, four days before petitioners' arrest, the Mayor of New Orleans issued an unequivocal statement condemning such conduct and demanding its cessation. This statement was also widely publicized; it read in part:
6
'I have today directed the superintendent of police that no additional sit-in demonstrations * * * will be permitted * * * regardless of the avowed purpose or intent of the participants * * *.
7
'It is my determination that the community interest, the public safety, and the economic welfare of this city require that such demonstrations cease and that henceforth they be prohibited by the police department.'3
8
Both statements were publicized in the New Orleans Times-Picayune. The Mayor and the Superintendent of Police both testified that, to their knowledge, no eating establishment in New Orleans operated desegregrated eating facilities.
9
Both the restaurant manager and the store manager asked the petitioners to leave. Petitioners were charged with failing to leave at the request of the store manager. There was evidence to indicate that the restaurant manager asked petitioners to leave in obedience to the directive of the city officials. He told them that 'I am not allowed to serve you here. * * * We have to sell to you at the rear of the store where we have a colored counter.' (Emphasis supplied.) And he called the police '(a)s a matter of routine procedure.' The petitioners testified that when they did not leave, the restaurant manager whistled and the employees removed the stools, turned off the lights, and put up a sign saying that the counter was closed. One petitioner stated that 'it appeared to be a very efficient thing, everyone knew what to do.' The store manager conceded that his decision to operate a segregated facility 'conform(ed) to state policy and practice' as well as local custom. When asked whether 'in the last 30 days to 60 days (he had) entered into any conference with other department store managers here in New Orleans relative to sit-in problems,' the store manager stated: '(w)e have spoken of it.' The above evidence all tended to indicate that the store officials' actions were coerced by the city. But the evidence of coercion was not fully developed because the trial judge forbade petitioners to ask questions directed to that very issue.
10
But we need not pursue this inquiry further. A State, or a city, may act as authoritatively through its executive as through its legislative body. See Ex parte Virginia, 100 U.S. 339, 347, 25 L.Ed. 676. As we interpret the New Orleans city officials' statements, they here determined that the city would not permit Negroes to seek desegregated service in restaurants. Consequently, the city must be treated exactly as if it had an ordinance prohibiting such conduct. We have just held in Peterson v. City of Greenville, 373 U.S. 244, 83 S.Ct. 1119, that where an ordinance makes it unlawful for owners or managers of restaurants to seat whites and Negroes together, a conviction under the State's criminal processes employed in a way which enforces the discrimination mandated by that ordinance cannot stand. Equally the State cannot achieve the same result by an official command which has at least as much coercive effect as an ordinance. The official command here was to direct continuance of segregated service in restaurants, and to prohibit any conduct directed toward its discontinuance; it was not restricted solely to preserve the public peace in a nondiscriminatory fashion in a situation where violence was present or imminent by reason of public demonstrations. Therefore here, as in Peterson, these convictions, commanded as they were by the voice of the State directing segregated service at the restaurant, cannot stand. Turner v. City of Memphis, 369 U.S. 350, 82 S.Ct. 805, 7 L.Ed.2d 762.
11
Reversed.
12
Mr. Justice DOUGLAS, concurring.
13
While I join the opinion of the Court, I have concluded it necessary to state with more particularity why Louisiana has become involved to a 'significant extent' (Burton v. Wilmington Parking Authority, 365 U.S. 715, 722, 81 S.Ct. 856, 860, 6 L.Ed.2d 45) in denying equal protection of the laws to petitioners.
I.
14
The court below based its affirmance of these convictions on the ground that the decision to segregate this restaurant was a private choice, uninfluenced by the officers of the State. State v. Goldfinch, 241 La. 958, 132 So.2d 860. If this were an intrusion of a man's home or yard or farm or garden, the property owner could seek and obtain the aid of the State against the intruder. For the Bill of Rights, as applied to the States through the Due Process Clause of the Fourteenth Amendment, casts its weight on the side of the privacy of homes. The Third Amendment with its ban on the quartering of soldiers in private homes radiates that philosophy. The Fourth Amendment, while concerned with official invasions of privacy through searches and seizures, is eloquent testimony of the sanctity of private premises. For even when the police enter private precincts they must, with rare exceptions, come armed with a warrant issued by a magistrate. A private person has no standing to obtain even limited access. The principle that a man's home is his castle is basic to our system of jurisprudence.
15
But a restaurant, like the other departments of this retail store where Negroes were served, though private property within the protection of the Fifth Amendment, has no aura of constitutionally protected privacy about it. Access by the public is the very reason for its existence.
16
'Ownership does not always mean absolute dominion. The more an owner, for his advantage, opens up his property for use by the public in general, the more do his rights become circumscribed by the statutory and constitutional rights of those who use it.' Marsh v. Alabama, 326 U.S. 501, 506, 66 S.Ct. 276, 278, 90 L.Ed. 265.
17
The line between a private business and a public one has been long and hotly contested. New State Ice Co. v. Liebmann, 285 U.S. 262, 52 S.Ct. 371, 76 L.Ed. 747, is one of the latest cases in a long chain. The Court, over the dissent of Mr. Justice Brandeis and Mr. Justice Stone, held unconstitutional an Oklahoma statute requiring those manufacturing ice for sale and distribution to obtain a license from the State. Mr. Justice Brandeis' dissent was in the tradition of an ancient doctrine perhaps best illustrated1 by German Alliance Ins. Co. v. Kansas, 233 U.S. 389, 34 S.Ct. 612, 58 L.Ed. 1011, L.R.A.1915C, 1189, which upheld a Kansas statute that regulated fire insurance rates. Mr. Justice McKenna, writing for the Court, said, 'It is the business that is the fundamental thing; property is but its instrument, the means of rendering the service which has become of public interest.' Id., 408, 34 S.Ct. 617. Cf. Ferguson v. Skrupa, 372 U.S. 726, 83 S.Ct. 1028.
18
Some of the cases reflect creative attempts by judges to make innkeepers, common carriers, and the like perform the public function of taking care of all travelers.2 Others involve the power of the legislature to impose various kinds of restraints or conditions on business. As a result of the conjunction of various forces, judicial and legislative, it came to pass that 'A large province of industrial activity is under the joint sovereignty of the market and the state.'3
19
The present case would be on all fours with the earlier ones holding that a business may be regulated when it renders a service which 'has become of public interest' (German Alliance Ins. Co. v. Kansas, supra, 233 U.S. 408, 34 S.Ct. 617) if Louisiana had declared, as do some States,4 that a business may not refuse service to a customer on account of race and the proprietor of the restaurant were charged with violating this statute. We should not await legislative action before declaring that state courts cannot enforce this type of segregation. Common-law judges fashioned the rules governing innkeepers and carriers.5 As stated by Holt, C.J., in Lane v. Cotton, 12 Mod. 472, 484 (1701):
20
'Wherever any subject takes upon himself a public trust for the benefit of the rest of his fellow-subjects, he is eo ipso bound to serve the subject in all the things that are within the reach and comprehension of such an office, under pain of an action against him. * * * If on the road a shoe fall off my horse, and I come to a smith to have one put on, and the smith refuse to do it, an action will lie against him, because he has made profession of a trade which is for the public good, and has thereby exposed and vested an interest of himself in all the king's subjects that will employ him in the way of his trade. If an innkeeper refuse to entertain a guest where his house is not full, an action will lie against him, and so against a carrier, if his horses be not loaded, and he refuse to take a packet proper to be sent by a carrier.'6
21
Judges who fashioned those rules had no written constitution as a guide. There were, to be sure, criminal statutes that regulated the common callings.7 But the civil remedies were judge made. We live under a constitution that proclaims equal protection of the laws. That standard is our guide. See Griffin v. Illinois, 351 U.S. 12, 76 S.Ct. 585, 100 L.Ed. 891; Douglas v. California, 372 U.S. 353, 83 S.Ct. 814, 9 L.Ed.2d 811. And under that standard business serving the public cannot seek the aid of the state police or the state courts or the state legislatures to foist racial segregation in public places under its ownership and control. The constitutional protection extends only to 'state' action, not to personal action. But we have 'state' action here, wholly apart from the activity of the Mayor and police, for Louisiana has interceded with its judiciary to put criminal sanctions behind racial discrimination in public places. She may not do so consistently with the Equal Protection Clause of the Fourteenth Amendment.
22
The criminal penalty (60 days in jail and a $350 fine) was imposed on these petitioners by Louisiana's judiciary. That action of the judiciary was state action. Such are the holdings in Shelley v. Kraemer, 334 U.S. 1, 68 S.Ct. 836, 92 L.Ed. 1161, and Barrows v. Jackson, 346 U.S. 249, 73 S.Ct. 1031, 97 L.Ed. 1586.8 Those cases involved restrictive covenants. Shelley v. Kraemer was a civil suit to enjoin violation of a restrictive covenant by a Negro purchaser. Barrows v. Jackson was a suit to collect damages for violating a restrictive covenant by selling residential property to a Negro. Those cases, like the present one, were 'property' cases. In those cases, as in the present one, the line was drawn at dealing with Negroes. There, as here, no state legislature was involved, only the state judiciary. The Court said in Shelley v. Kraemer:
23
'That the action of state courts and of judicial officers in their official capacities is to be regarded as action of the State within the meaning of the Fourteenth Amendment, is a proposition which has long been established by decisions of this Court.' 334 U.S., at 14, 68 S.Ct., at 842.
24
The list of instances where action of the state judiciary is state action within the meaning of the Fourteenth Amendment is a long one. Many were noted in Shelley v. Kraemer, 334 U.S., at 14—18, 68 S.Ct., at 842—844. Most state convictions in violation of the First, Fourth, or Fifth Amendment, as incorporated in the Due Process Clause of the Fourteenth Amendment, have indeed implicated not the state legislature but the state judiciary, or the state judiciary and the state prosecutor and the state police. Shelley v. Kraemer—and later Barrows v. Jackson—held that the state judiciary, acting alone to enforce private discrimination against Negroes who desired to buy private property in residential areas, violated the Equal Protection Clause of the Fourteenth Amendment.
25
Places of public accommodation such as retail stores, restaurants, and the like render a 'service which has become of public interest' (German Alliance Ins. Co. v. Kansas, supra, 233 U.S. 408, 34 S.Ct. 617) in the manner of the innkeepers and common carriers of old. The substance of the old common-law rules has no direct bearing on the decision required in this case. Restaurateurs and owners of other places of amusement and resort have never been subjected to the same duties as innkeepers and common carriers.9 But, what is important is that this whole body of law was a response to the felt needs of the times that spawned it.10 In our time the interdependence of people has greatly increased; the days of laissez faire have largely disappeared; men are more and more dependent on their neighbors for services as well as for housing and the other necessities of life. By enforcing this criminal mischief statute, invoked in the manner now before us, the Louisiana courts are denying some people access to the mainstream of our highly interdependent life solely because of their race. Yet, 'if there is any one purpose of the Fourteenth Amendment that is wholly outside the realm of doubt, it is that the Amendment was designed to bar States from denying to some groups, on account of their race or color, any rights, privileges, and opportunities accorded to other groups.' Oyama v. California, 332 U.S. 633, 649, 68 S.Ct. 269, 276, 92 L.Ed. 249 (concurring opinion).
26
An innkeeper or common carrier has always been allowed to exclude drunks, criminals and diseased persons, but only because the public's interest in protecting his and his guests' health and property outweighs its interest in providing accommodations for this small group of travelers.11 As a general rule, innkeepers and carriers cannot refuse their services on account of race; though the rule developed in this country that they can provide 'separate but equal' facilities.12 And for a period of our history even this Court upheld state laws giving sanction to such a rule. Compare Plessy v. Ferguson, 163 U.S. 537, 16 S.Ct. 1138, 41 L.Ed. 256, with Gayle v. Browder, 352 U.S. 903, 77 S.Ct. 145, 1 L.Ed.2d 114, affirming, D.C., 142 F.Supp. 707. But surely Shelley v. Kraemer, supra, and Barrows v. Jackson, supra, show that the day has passed when an innkeeper, carrier, housing developer, or retailer can draw a racial line, refuse service to some on account of color, and obtain the aid of a State in enforcing his personal bias by sending outlawed customers to prison or exacting fines from them.
27
Business, such as this restaurant, is still private property. Yet there is hardly any private enterprise that does not feel the pinch of some public regulation—from price control, to health and fire inspection, to zoning, to safety measures, to minimum wages and working conditions, to unemployment insurance. When the doors of a business are open to the public, they must be open to all regardless of race if apartheid is not to become engrained in our public places. It cannot by reason of the Equal Protection Clause become so engrained with the aid of state courts, state legislatures, or state police.13
II.
28
There is even greater reason to bar a State through its judiciary from throwing its weight on the side of racial discrimination in the present case, because we deal here with a place of public accommodation under license from the State. This is the idea I expressed in Garner v. Louisiana, 368 U.S. 157, 82 S.Ct. 248, 7 L.Ed.2d 207, where another owner of a restaurant refused service to a customer because he was a Negro. That view is not novel; it stems from the dissent of the first Mr. Justice Harlan in the Civil Rights Cases, 109 U.S. 3, 58—59, 3 S.Ct. 18, 55, 27 L.Ed. 835:
29
'In every material sense applicable to the practical enforcement of the Fourteenth Amendment, railroad corporations, keepers of inns, and managers of places of public amusement are agents or instrumentalities of the State, because they are charged with duties to the public, and are amenable, in respect of their duties and functions, to governmental regulation. It seems to me that, within the principle settled in Exparte Virginia, a denial, by these instrumentalities of the State, to the citizen, because of his race, of that equality of civil rights secured to him by law, is a denial by the State, within the meaning of the Fourteenth Amendment. If it be not, then that race is left, in respect of the civil rights in question, practically at the mercy of corporations and individuals wielding power under the States.'
30
The nexus between the State and the private enterprise may be control, as in the case of a state agency. Pennsylvania v. Board of Trusts, 353 U.S. 230, 77 S.Ct. 806, 1 L.Ed.2d 792. Or the nexus may be one of numerous other devices. 'State support of segregated schools through any arrangement, management, funds, or property cannot be squared' with the Equal Protection Clause. Cooper v. Aaron, 358 U.S. 1, 19, 78 S.Ct. 1401, 1410, 3 L.Ed.2d 5. Cf. Hampton v. Jacksonville, 5 Cir., 304 F.2d 320. A state-assisted enterprise serving the public does not escape its constitutional duty to serve all customers irrespective of race, even though its actual operation is in the hands of a lessee. Burton v. Wilmington Parking Authority, 365 U.S. 715, 81 S.Ct. 856, 6 L.Ed.2d 45. Cf. Boynton v. Virginia, 364 U.S. 454, 81 S.Ct. 182, 5 L.Ed.2d 206. State licensing and surveillance of a business serving the public also brings its service into the public domain. This restaurant needs a permit from Louisiana to operate;14 and during the existence of the license the State has broad powers of visitation and control.15 This restaurant is thus an instrumentality of the State since the State charges it with duties to the public and supervises its performance. The State's interest in and activity with regard to its restaurants extends far beyond any mere income-producing licensing requirement.
31
There is no constitutional way, as I see it, in which a State can license and supervise a business serving the public and endow it with the authority to manage that business on the basis of apartheid, which is foreign to our Constitution.
1
LSA—Rev.Stat., 1950 (Cum.Supp.1960), § 14:59(6), provides in pertinent part:
'Criminal mischief is the intentional performance of any of the following acts:
'(6) Taking temporary possession of any part or parts of a place of business, or remaining in a place of business after the person in charge of such business or portion of such business has ordered such person to leave the premises and to desist from the temporary possession of any part or parts of such business.'
2
The full text of the statement reads:
'The regrettable sit-in activity today at the lunch counter of a Canal st. chain store by several young white and Negro persons causes me to issue this statement to the citizens of New Orleans.
'We urge every adult and juvenile to read this statement carefully, completely and calmly.
'First, it is important that all citizens of our community understand that this sit-in demonstration was initiated by a very small group.
'We firmly believe that they do not reflect the sentiments of the great majority of responsible citizens, both white and Negro, who make up our population.
'We believe it is most important that the mature responsible citizens of both races in this city understand that and that they continue the exercise of sound, individual judgment, goodwill and a sense of personal and community responsibility.
'Members of both the white and Negro groups in New Orleans for the most part are aware of the individual's obligation for good conduct—an obligation both to himself and to his community. With the exercise of continued, responsible law-abiding conduct by all persons, we see no reason for any change whatever in the normal, good race-relations that have traditionally existed in New Orleans.
'At the same time we wish to say to every adult and juvenile in this city that the police department intends to maintain peace and order.
'No one should have any concern or question over either the intent or the ability of this department to keep and preserve peace and order.
'As part of its regular operating program, the New Orleans police department is prepared to take prompt and effective action against any person or group who disturbs the peace or creates disorder on public or private property.
'We wish to urge the parents of both white and Negro students who participated in today's sit-in demonstration to urge upon these young people that such actions are not in the community interest.
'Finally, we want everyone to fully understand that the police department and its personnel is ready and able to enforce the laws of the city of New Orleans and the state of Louisiana.'
3
The full text of the Mayor's statements reads:
'I have today directed the superintendent of police that no additional sit-in demonstrations or so-called peaceful picketing outside retail stores by sit-in demonstrators or their sympathizers will be permitted.
'The police department, in my judgment, has handled the initial sit-in demonstration Friday and the follow-up picketing activity Saturday in an efficient and creditable manner. This is in keeping with the oft-announced policy of the New Orleans city government that peace and order in our city will be preserved.
'I have carefully reviewed the reports of these two initial demonstrations by a small group of misguided white and Negro students, or former students. It is my considered opinion that regardless of the avowed purpose or intent of the participants, the effect of such demonstrations is not in the public interest of this community.
'Act 70 of the 1960 Legislative session (LSA—R.S. 14:103) redefines disturbing the peace to include 'the commission of any act as would foreseeably disturb or alarm the public.'
'Act 70 also provides that persons who seek to prevent prospective customers from entering private premises to transact business shall be guilty of disorderly conduct and disturbing the peace.
'Act 80 (LSA—R.S. 14:100.1)—obstructing public passages provides that 'no person shall wilfully obstruct the free, convenient, and normal use of any public sidewalk, street, highway, road, bridge, alley or other passage way or the entrance, corridor or passage of any public building, structure, water craft or ferry by impeding, hindering, stifling, retarding or restraining traffic or passage thereon or therein.'
'It is my determination that the community interest, the public safety, and the economic welfare of this city require that such demonstrations cease and that henceforth they be prohibited by the police department.'
1
See Hamilton, Affectation with Public Interest, 39 Yale L.J. 1089, 1098—1099.
2
See Jeremy, The Law of Carriers, Inn-Keepers, etc. (1815), 4—5, 144—147; Tids-well, The Innkeeper's Legal Guide (1864), c. 1; Schouler, Law of Bailments (2d ed. 1887), §§ 274—329, 330—341; Beale, The Law of Innkeepers and Hotels (1906), passim; 1 Wyman, Public Service Corporations (1911), §§ 1—5; Burdick, The Origin of the Peculiar Duties of Public Service Companies, 11 Col.L.Rev. 514, 616; Arterburn, The Origin and First Test of Public Callings, 75 U. of Pa.L.Rev. 411.
3
Hamilton, supra, note 1, p. 1110.
4
See, e.g., McKinney's Consol.N.Y.Laws, Vol. 8, Civil Rights Law, c. 6, Art. 4; id., Vol. 18, Executive Law, c. 18, Art. 15; N.J.Stat.Ann., Tit. 10; id., Tit. 18, c. 25; Cal.Civ.Code, § 51. Cf. Cal.Health and Safety Code, §§ 35700 (1962 Supp.) et seq.; Burks v. Poppy Constr. Co., 57 Cal.2d 463, 20 Cal.Rptr. 609, 370 P.2d 313; Martin v. New York, 22 Misc.2d 389, 201 N.Y.S.2d 111. See generally, Greenberg, Race Relations and American Law, 101—114 (1959); 7 St. Louis U.L.J. 88 (1962).
5
See Schouler, op. cit., supra, note 2, §§ 274, 335; Wyman, op. cit., supra, note 2, § 1; Arterburn, supra, note 2.
6
See also White's Case (1558), 2 Dyer 158.b.; Warbrooke v. Griffin (1609), 2 Brownl. 254; Bennett v. Mellor (1793), 5 Term Rep. 273; Thompson v. Lacy (1820), 3 B. & Ald. 283.
For criminal prosecutions, see, e.g., Rex v. Ivens (1835), 7 Car. & P. *213; Regina v. Sprague (1899), 63 J.P. 233.
For a collection of the English cases, see 21 Halsbury's Laws of England (3d ed. 1957) 441 et seq.; 10 Mews' Dig.Eng.Cas.L. to 1924, pp. 1463 et seq.
7
Arterburn, supra, note 2.
8
See also Abstract Investment Co. v. Hutchinson, 204 Cal.App.2d 242, 251, 22 Cal.Rptr. 309, 315; 10 U.C.L.A.L.Rev. 401.
9
See Marrone v. Washington Jockey Club, 227 U.S. 633, 33 S.Ct. 401, 57 L.Ed. 679; Madden v. Queens County Jockey Club, 296 N.Y. 249, 72 N.E.2d 697, 1 A.L.R.2d 1160; Alpaugh v. Wolverton, 184 Va. 943, 36 S.E.2d 906; Nance v. Mayflower Tavern, 106 Utah 517, 150 P.2d 773.
10
Wyman, op. cit., supra, note 2, §§ 1, 2—16, 330; Schouler, op. cit., supra, note 2, §§ 274, 335; Beale, op. cit., supra, note 2, c. I; Arterburn, supra, note 2, 420—426.
11
Wyman, op. cit., supra, note 2, c. 18; Schouler, op. cit., supra, note 2, §§ 320, 322.
12
Compare, e.g., Constantine v. Imperial Hotels (1944), 1 K.B. 693; Wyman, op. cit., supra, note 2, §§ 361, 565, 566, with State v. Steele, 106 N.C. 766, 782, 11 S.E. 478, 484, 8 L.R.A. 516.
13
See generally, Pollitt, Dime Store Demonstrations: Events and Legal Problems of First Sixty Days, 1960 Duke L.J. 315, 350 365; Henkin, Shelley v. Kraemer: Notes for a Revised Opinion, 110 U. of Pa.L.Rev. 473.
14
Under the provisions of Article 7.02 of the Sanitary Code, promulgated by the State Board of Health pursuant to LSA Rev.Stat. § 40:11, no person shall operate a public eating place of any kind in the State of Louisiana unless he has been issued a permit to operate by the local health officer; and permits shall be issued only to persons whose establishments comply with the requirements of the Sanitary Code.
15
Under LSA—Rev.Stat., Title 40, §§ 11, 12, 15, 16, 52, and 69, state and local health officials closely police the provisions of the Sanitary Code. They may 'enter, examine, and inspect all grounds, structures, public buildings, and public places in execution of a warrant issued in accordance with the constitution and laws of Louisiana,' and 'arrest * * * all persons violating any rule or regulation of the board or any article or provision of the sanitary code * * *.' Penalties are provided for code violations. See also New Orleans City Code, 1956, §§ 29—55, 56, and 58; Home Rule Charter of the City of New Orleans, § 4—1202(2).
| 12
|
373 U.S. 244
83 S.Ct. 1133
10 L.Ed.2d 323
James Richard PETERSON et al., Petitioners,v.CITY OF GREENVILLE. Rudolph LOMBARD et al., Petitioners, v. STATE OF LOUISIANA. James GOBER et al., Petitioners, v. CITY OF BIRMINGHAM. John Thomas AVENT et al., Petitioners, v. STATE OF NORTH CAROLINA. F. L. SHUTTLESWORTH and C. Billups, Petitioners, v. CITY OF BIRMINGHAM.
Nos. 71, 58, 66, 11 and 67.
Supreme Court of the United States
May 20, 1963
Matthew J. Perry, Columbia, S.C., for petitioners.
Theodore A. Snyder, Jr., Greenville, S.C., for respondent.
Archibald Cox, Sol. Gen., for the United States, as amicus curiae, by special leave of Court.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
The petitioners were convicted in the Recorder's Court of the City of Greenville, South Carolina, for violating the trespass statute of that State.* Each was sentenced to pay a fine of $100 or in lieu thereof to serve 30 days in jail. An appeal to the Greenville County Court was dismissed, and the Supreme Court of South Carolina affirmed. 239 S.C. 298, 122 S.E.2d 826. We granted certiorari to consider the substantial federal questions presented by the record. 370 U.S. 935, 82 S.Ct. 1577, 8 L.Ed.2d 806.
2
The 10 petitioners are Negro boys and girls who, on August 9, 1960, entered the S. H. Kress store in Greenville and seated themselves at the lunch counter for the purpose, as they testified, of being served. When the Kress manager observed the petitioners sitting at the counter, he 'had one of (his) * * * employees call the Police Department and turn off the lights and state the lunch counter closed.' A captain of police and two other officers responded by proceeding to the store in a patrol car where they were met by other policemen and two state agents who had preceded them there. In the presence of the police and the state agents, the manager 'announced that the lunch counter was being closed and would everyone leave' the area. The petitioners, who had been sitting at the counter for five minutes, remained seated and were promptly arrested. The boys were searched, and both boys and girls were taken to police headquarters.
3
The manager of the store did not request the police to arrest petitioners; he asked them to leave because integrated service was 'contrary to local customs' of segregation at lunch counters and in violation of the following Greenville City ordinance requiring separation of the races in restaurants:
4
'It shall be unlawful for any person owning, managing or controlling any hotel, restaurant, cafe, eating house, boarding-house or similar establishment to furnish meals to white persons and colored persons in the same room, or at the same table, or at the same counter; provided, however, that meals may be served to white persons and colored persons in the same room where separate facilities are furnished. Separate facilities shall be interpreted to mean:
5
'(a) Separate eating utensils and separate dishes for the serving of food, all of which shall be distinctly marked by some appropriate color scheme or otherwise;
6
'(b) Separate tables, counters or booths;
7
'(c) A distance of at least thirty-five feet shall be maintained between the area where white and colored persons are served;
8
'(d) The area referred to in subsection (c) above shall not be vacant but shall be occupied by the usual display counters and merchandise found in a business concern of a similar nature; '(e) A separate facility shall be maintained and used for the cleaning of eating utensils and dishes furnished the two races.' Code of Greenville, 1953, as amended in 1958, § 31—8.
9
The manager and the police conceded that the petitioners were clean, well dressed, unoffensive in conduct, and that they sat quietly at the counter which was designed to accommodate 59 persons. The manager described his establishment as a national chain store of 15 or 20 departments, selling over 10,000 items. He stated that the general public was invited to do business at the store and that the patronage of Negroes was solicited in all departments of the store other than the lunch counter.
10
Petitioners maintain that South Carolina has denied them rights of free speech, both because their activity was protected by the First and Fourteenth Amendments and because the trespass statute did not require a showing that the Kress manager gave them notice of his authority when he asked them to leave. Petitioners also assert that they have been deprived of the equal protection of the laws secured to them against state action by the Fourteenth Amendment. We need decide only the last of the questions thus raised.
11
The evidence in this case establishes beyond doubt that the Kress management's decision to exclude petitioners from the lunch counter was made because they were Negroes. It cannot be disputed that under out decisions 'private conduct abridging individual rights does no violence to the Equal Protection Clause unless to some significant extent the State in any of its manifestations has been found to have become involved in it.' Burton v. Wilmington Parking Authority, 365 U.S. 715, 722, 81 S.Ct. 856, 860, 6 L.Ed.2d 45; Turner v. City of Memphis, 369 U.S. 350, 82 S.Ct. 805, 7 L.Ed.2d 762.
12
It cannot be denied that here the City of Greenville, an agency of the State, has provided by its ordinance that the decision as to whether a restaurant facility is to be operated on a desegregated basis is to be reserved to it. When the State has commanded a particular result, it has saved to itself the power to determine that result and thereby 'to a significant extent' has 'become involved' in it, and, in fact, has removed that decision from the sphere of private choice. It has thus effectively determined that a person owning, managing or controlling an eating place is left with no choice of his own but must segregate his white and Negro patrons. The Kress management, in deciding to exclude Negroes, did precisely what the city law required.
13
Consequently these convictions cannot stand, even assuming, as respondent contends, that the manager would have acted as he did independently of the existence of the ordinance. The State will not be heard to make this contention in support of the convictions. For the convictions had the effect, which the State cannot deny, of enforcing the ordinance passed by the City of Greenville, the agency of the State. When a state agency passes a law compelling persons to discriminate against other persons because of race, and the State's criminal processes are employed in a way which enforces the discrimination mandated by that law, such a palpable violation of the Fourteenth Amendment cannot be saved by attempting to separate the mental urges of the discriminators.
14
Reversed.
15
Mr. Justice HARLAN, concurring in the result in No. 71, and dissenting in whole or in part in Nos. 58, 66, 11, and 67.
16
These five racial discrimination cases, and No. 68, Wright v. Georgia, 373 U.S. 284, 83 S.Ct. 1240, in which I join the opinion of the Court, were argued together. Four of them arise out of 'sitin' demonstrations in the South and involve convictions of Negro students1 for violations of criminal trespass laws, or similar statutes, in South Carolina (Peterson, 373 U.S. 244, 83 S.Ct. 1133), Louisiana (Lombard, 373 U.S. 267, 83 S.Ct. 1122), Alabama (Gober, 373 U.S. 374, 83 S.Ct. 1311), and North Carolina (Avent, 373 U.S. 375, 83 S.Ct. 1311) respectively. Each of these convictions rests on state court findings, which in my opinion are supported by evidence, that the several petitioners had refused to move from 'white' lunch counters situated on the premises of privately owned department stores after having been duly requested to do so by the management. The other case involves the conviction of two Negro ministers for inciting, aiding, or abetting criminal trespasses in Alabama (Shuttlesworth, 373 U.S. 262, 83 S.Ct. 1130).
17
In deciding these cases the Court does not question the long-established rule that the Fourteenth Amendment reaches only state action. Civil Rights Cases, 109 U.S. 3, 3 S.Ct. 18, 27 L.Ed. 835. And it does not suggest that such action, denying equal protection, may be found in the mere enforcement of trespass laws in relation to private business establishments from which the management, of its own free will, has chosen to exclude persons of the Negro race.2 Judicial enforcement is of course state action, but this is not the end of the inquiry. The ultimate substantive question is whether there has been '(S)tate action of a particular character' (Civil Rights Cases, supra, at 11, 3 S.Ct. at 21) whether the character of the State's involvement in an arbitrary discrimination is such that it should be held responsible for the discrimination.
18
This limitation on the scope of the prohibitions of the Fourteenth Amendment serves several vital functions in our system. Underlying the cases involving an alleged denial of equal protection by ostensibly private action is a clash of competing constitutional claims of a high order: liberty and equality. Freedom of the individual to chose his associates or his neighbors, to use and dispose of his property as he sees fit, to be irrational, arbitrary, capricious, even unjust in his personal relations are things all entitled to a large measure of protection from governmental interference. This liberty would be overridden, in the name of equality, if the strictures of the Amendment were applied to governmental and private action without distinction. Also inherent in the concept of state action are values of federalism, a recognition that there are areas of private rights upon which federal power should not lay a heavy hand and which should properly be left to the more precise instruments of local authority.
19
My differences with the Court relate primarily to its treatment of the state action issue and to the broad strides with which it has proceeded in setting aside the convictions in all of these cases. In my opinion the cases call for discrete treatment and results.
I.
20
THE PETERSON CASE (NO. 71).
21
In this case, involving the S. H. Kress store in Greenville, South Carolina, the Court finds state action in violation of the Fourteenth Amendment in the circumstance that Greenville still has on its books an ordinance, 373 U.S. 246, 83 S.Ct. 1120, requiring segregated facilities for colored and white persons in public eating places. It holds that the mere existence of the ordinance rendered the State's enforcement of its trespass laws unconstitutional, quite irrespective of whether the Kress decision to exclude these petitioners from the white lunch counter was actually influenced by the ordinance. The rationale is that the State, having compelled restaurateurs to segregate their establishments through this city ordinance, cannot be heard to say, in enforcing its trespass statute, that Kress' decision to segregate was in fact but the product of its own untrammeled choice. This is said to follow because the ordinance removes the operation of segregated or desegregated eating facilities 'from the sphere of private choice' and because 'the State's criminal processes are employed in a way which enforces' the ordinance. 373 U.S. 248, 83 S.Ct. 1121.
22
This is an alluring but, in my view, a fallacious proposition. Clearly Kress might have preferred for reasons entirely of its own not to serve meals to Negroes along with whites, and the dispositive question on the issue of state action thus becomes whether such was the case, or whether the ordinance played some part in the Kress decision to segregate. That is a question of fact.
23
Preliminarily, I do not understand the Court to suggest that the ordinance's removal of the right to operate a segregated restaurant 'from the sphere of private choice' renders the private restaurant owner the agent of the State, such that his operation of a segregated facility ipso facto becomes the act of the State. Such a theory might well carry the consequence that a private person so operating his restaurant would be subject to a Civil Rights Act suit on the part of an excluded Negro for unconstitutional action taken under color of state law (cf. Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492)—an incongruous result which I would be loath to infer that the Court intends. Kress is of course a purely private enterprise. It is in no sense 'the repository of state power,' Home Tel. & Tel. Co. v. Los Angeles, 227 U.S. 278, 286, 33 S.Ct. 312, 314, 57 L.Ed. 510, and this segregation ordinance no more makes Kress the agent or delegate of the State than would any other prohibitory measure affecting the conduct of its business. The Court does not intimate anything to the contrary.
24
The majority's approach to the state action issue is in my opinion quite untenable. Although the right of a private restaurateur to operate, if he pleases, on a segregated basis is ostensibly left untouched, the Court in truth effectually deprives him of that right in any State where a law like this Greenville ordinance continues to exist. For a choice that can be enforced only by resort to 'self-help' has certainly become a greatly diluted right, if it has not indeed been totally destroyed.
25
An individual's right to restrict the use of his property, however unregenerate a particular exercise of that right may be thought, lies beyond the reach of the Fourteenth Amendment. The dilution or virtual elimination of that right cannot well be justified either on the premise that it will hasten formal repeal of outworn segregation laws or on the ground that it will facilitate proof of state action in cases of this kind. Those laws have already found their just constitutional deserts in the decisions of this Court, and in many communities in which racial discrimination is no longer a universal or widespread practice such laws may have a purely formal existence and may indeed be totally unknown. Of course this is not to say that their existence on the books may never play a significant and even decisive role in private decision making. But the question in each case, if the right of the individual to make his own decisions is to remain viable, must be: was the discriminatory exclusion in fact influenced by the law? Cf. Truax v. Raich, 239 U.S. 33, 36 S.Ct. 7, 60 L.Ed. 131.3 The inexorable rule which the Court lays down reflects insufficient reckoning with the demands of history.
26
It is suggested that requiring proof of the effect of such laws in individual instances would involve 'attempting to separate the mental urges of the discriminators', 373 U.S. 248, 83 S.Ct. 1121. But proof of state of mind is not a novel concept in the law of evidence, see 2 Wigmore, Evidence (3d ed. 1940), §§ 385—393, and such a requirement presents no special barriers in this situation. The mere showing of such an ordinance would, in my judgment, make out a prima facie case of invalid state action, casting on the State the burden of proving that the exclusion was in fact the product solely of private choice. In circumstances like these that burden is indeed a heavy one. This is the rule which, in my opinion, even handed constitutional doctrine and recognized evidentiary rules dictate. Its application here calls for reversal of these convictions.
27
At the trial existence of the Greenville segregation ordinance was shown and the city adduced no rebutting evidence indicating that the Kress manager's decision to exclude these petitioners from the white lunch counter was wholly the product of private choice. All doubt on that score is indeed removed by the store manager's own testimony. Asked for the reasons for his action, he said: 'It's contrary to local customs (sic) and it's also the ordinance that has been discussed' (quite evidently referring to the segregation ordinance). (Emphasis added.) This suffices to establish state action, and leads me to join in the judgment of the Court.
II.
28
THE LOMBARD CASE (NO. 58).
29
In this case, involving 'sit-ins' at the McCrory store in New Orleans, Louisiana, the Court carries its state action rule a step further. Neither Louisiana nor New Orleans has any statute or ordinance requiring segregated eating facilities. In this instance state action is found in the public announcements of the Superintendent of Police and the Mayor of New Orleans, set forth in the Court's opinion, 373 U.S. 267, 83 S.Ct. 1122, which were issued shortly after 'sit-in' demonstrations had first begun in the city. Treating these announcements as the equivalent of a city ordinance, the Court holds that they served to make the State's employment of its 'trespass' statute against these petitioners unconstitutional, again without regard to whether or not their exclusion by McCrory was in fact influenced in any way by these announcements.
30
In addition to what has already been said in criticism of the Peterson ruling, there are two further factors that make the Court's theory even more untenable in this case.
31
1. The announcements of the Police Superintendent and the Mayor cannot well be compared with a city ordinance commanding segregated eating facilities. Neither announcement was addressed to restaurateurs in particular, but to the citizenry generally. They did not press private proprietors to segregate eating facilities; rather they in effect simply urged Negroes and whites not to insist on nonsegregated service in places where segregated service obtained. In short, so far as this record shows, had the McCrory store chosen to serve these petitioners along with whites it could have done so free of any sanctions or official constraint.
32
2. The Court seems to take the two announcements as an attempt on the part of the Police Superintendent and the Mayor to perpetuate segregation in New Orleans. I think they are more properly read as an effort by these two officials to preserve the peace in what they might reasonably have regarded as a highly charged atmosphere. That seems to me the fair tenor of their exhortations.
33
If there were nothing more to this case, I would vote to affirm these convictions for want of a sufficient showing of state action denying equal protection. There is, however, some evidence in the record which might indicate advance collaboration between the police and McCrory with respect to these episodes. The trial judge refused to permit defense counsel to pursue inquiry along this line, although counsel had made it perfectly clear that his purpose was to establish official participation in the exclusion of his clients by the McCrory store. I think the shutting off of this line of inquiry was prejudicial error.
34
For this reason I would vacate the judgment of the state court and remand the case for a new trial so that the issue of state action may be properly explored.
III.
35
THE GOBER CASE (NO. 66).
36
This case concerns 'sit-ins' at five different department stores in Birmingham, Alabama. Birmingham has an ordinance requiring segregated facilities in public eating places.4
37
It is first necessary to consider whether this ordinance is properly before us, a question not dealt with in this Court's per curiam reversal. The Alabama Court of Appeals refused to consider the effect of the ordinance on petitioners' claim of denial of equal protection, stating that 'there is no question presented in the record before us, by the pleading, of any statute or ordinance requiring the separation of the races in restaurants. The prosecution was for a criminal trespass on private property.' Gober v. City of Birmingham, 41 Ala.App. 313, at 317, 133 So.2d 697, at 701.
38
This, on the one hand, could be taken to mean that the Birmingham ordinance was not properly before the Court of Appeals because it had not been specially pleaded as a defense. We would then be faced with the necessity of deciding whether such a state ground is adequate to preclude our consideration of the significance of the ordinance. In support of the view that such a ground exists respondent refers us to Alabama Code (1958), Tit. 7, § 225, requiring matters of defense to be pleaded specially in a civil case,5 and to the statement of the Court of Appeals that '(t)his being an appeal from a conviction for violating a city ordinance, it is quasi criminal in nature, and subject to rules governing civil appeals,' 41 Ala.App., at 315, 133 So.2d, at 699.
39
On the other hand, in view of the last sentence in the Court of Appeals' statement—'The prosecution was for a criminal trespass on private property'—it may be that the court simply shared the apparent misapprehension of the trial judge as to the materiality of the segregation ordinance in a prosecution laid only under the trespass statute.6 This view of the matter is lent some color by the circumstance that, although Alabama Code (1958), Tit. 7, § 429(1), rendered the ordinance judicially noticeable, the Court of Appeals' opinion does not address itself at all to the question whether the ordinance, bearing as it did on the vital issue of state action in this trespass prosecution, was in truth a 'matter of defense' within the meaning of § 225.7
40
In this muddy posture of things it is impossible to say whether or not these judgments are supportable on an adequate and independent state ground. Because of this, and in light of the views I have expressed in the Peterson case, 373 U.S., pp. 250 253, 83 S.Ct., pp. 250—253, two things are called for. First, the parties should be afforded an opportunity to obtain from the Alabama Court of Appeals a clarification of its procedural holding respecting the Birmingham segregation ordinance. If the Court of Appeals holds that it is procedurally foreclosed from considering the ordinance, the adequacy of such a state ground would then of course be a question for this Court. Second, if the Court of Appeals holds that it is not foreclosed from considering the ordinance, there should then be a new trial so that the bearing of the ordinance on the issue of state action may be fully explored. To these ends I would vacate the judgments below and remand the case to the Alabama Court of Appeals.
IV.
41
THE AVENT CASE (NO. 11).
42
In this case it turns out that the City of Durham, North Carolina, where these 'sit-ins' took place, also had a restaurant segregation ordinance.8 In affirming these convictions the North Carolina Supreme Court evidently proceeded, however, on the erroneous assumption that no such ordinance existed. 253 N.C. 580, 118 S.E.2d 47.
43
In these circumstances I agree with the Court that the case should be returned to the State Supreme Court for further consideration. See Patterson v. Alabama, 294 U.S. 600, 55 S.Ct. 575, 79 L.Ed. 1082. But disagreeing as I do with the premises on which the case will go back under the majority's opinion in Peterson, I must to that extent dissent from the opinion and judgment of the Court.
V.
THE SHUTTLESWORTH CASE (NO. 67).
44
This last of these cases concerns the Alabama convictions of two Negro clergymen, Shuttlesworth and Billups, for inciting, aiding, or abetting alleged violations of the criminal trespass ordinance of the City of Birmingham.
45
On the premise that these two petitioners were charged with inciting, aiding, or abetting only the 'sit-ins' involved in the Gober case, 373 U.S. 374, 83 S.Ct. 1311, the Court, relying on the unassailable proposition that 'there can be no conviction for aiding and abetting someone to do an innocent act', 373 U.S. 265, 83 S.Ct. 1132, holds that these convictions must fall in consequence of its reversal of those in the Gober case. The difficulty with this holding is that it is based on an erroneous premise. Shuttlesworth and Billups were not charged merely with inciting the Gober 'sit-ins' but generally with inciting violations of the Birmingham trespass ordinance. And I do not think it can be said that the record lacks evidence of incitement of 'sit-ins' other than those involved in Gober.9 Hence the Court's reversal in Gober cannot well serve as the ground for reversal here.
46
There are, however, other reasons why, in my opinion, these convictions cannot stand. As to Billups, the record shows that he brought one of the students to Shuttlesworth's home and remained there while Shuttlesworth talked. But there is nothing to indicate Billups' purpose in bringing the student, what he said to him, or even whether he approved or disapproved of what Shuttlesworth urged the students to do. A conviction so lacking in evidence to support the offense charged must fall under the Fourteenth Amendment. Thompson v. Louisville, 362 U.S. 199, 80 S.Ct. 624, 4 L.Ed.2d 654.
47
On this score the situation is different with respect to Shuttlesworth. Given (1) the then current prevalence of 'sit-in' demonstrations throughout the South,10 (2) the commonly understood use of the phrase 'sit-in' or 'sit-down' to designate a form of protest which typically resulted in arrest and conviction for criminal trespass or other similar offense, and (3) the evidence as to Shuttlesworth's calling for 'sit-down' volunteers and his statement that he would get any who volunteered 'out of jail,' I cannot say that it was constitutionally impermissible for the State to find that Shuttlesworth had urged the volunteers to demonstrate on privately owned premises despite any objections by their owners, and thus to engage in criminal trespass.
48
Nevertheless this does not end the matter. The trespasses which Shuttlesworth was convicted of inciting may or may not have involved denials of equal protection, depending on the event of the 'state action' issue. Certainly one may not be convicted for inciting conduct which is not itself constitutionally punishable. And dealing as we are in the realm of expression, I do not think a State may punish incitement of activity in circumstances where there is a substantial likelihood that such activity may be constitutionally protected. Cf. Garner v. Louisiana, 368 U.S. 157, 196—207, 82 S.Ct. 248, 268—274, 7 L.Ed. 207 (concurring opinion of this writer). To ignore that factor would unduly inhibit freedom of expression, even though criminal liability for incitement does not ordinarily depend upon the event of the conduct incited.11
49
Were I able to agree with the Court that the existence of the Birmingham segregation ordinance without more rendered all incited trespasses in Birmingham immune from prosecution, I think outright reversal of Shuttlesworth's conviction would be called for. But because of my different views as to the significance of such ordinances (supra, pp. 251—253), I believe that the bearing of this Birmingham ordinance on the issue of 'substantiality' in Shuttlesworth's case, no less than its bearing on 'state action' in the Gober case, involves questions of fact which must first be determined by the state courts. I would therefore vacate the judgment as to Shuttlesworth and remand his case for a new trial.
50
These then are the results in these cases which in my view sound legal principles require.
*
S.C.Code, 1952 (Cum.Supp.1960), § 16—388:
'Entering premises after warned not to do so or failing to leave after requested.
'Any person:
'(1) Who without legal cause or good accuse enters into the dwelling house, place of business or on the premises of another person, after having been warned, within six months preceding, not to do so or
'(2) Who, having entered into the dwelling house, place of business or on the premises of another person without having been warned within six months not to do so, and fails and refuses, without good cause or excuse, to leave immediately upon being ordered or requested to do so by the person in possession, or his agent or representative.
'Shall, on conviction, be fined not more than one hundred dollars, or be imprisoned for not more than thirty days.'
1
Except for one white student who participated in a demonstration. Lombard, 373 U.S. 267, 83 S.Ct. 1122.
2
It is not nor could it well be suggested that general admission of Negroes to the stores prevented the management from excluding them from service at the white lunch counters.
3
In Truax the Court, in finding state action in violation of the Fourteenth Amendment, relied on the evidence showing that an alien employee had been discharged by his employer solely because of the latter's fear of criminal penalties for noncompliance with a state statute prohibiting the employment of more than a certain number of aliens. The Court stressed the importance of 'the freedom of the employer to exercise his judgment without illegal interference or compulsion * * *.' Id., at 38, 36 S.Ct. at 9. (Emphasis added.)
4
General City Code of Birmingham (1944), § 369: 'It shall be unlawful to conduct a restaurant or other place for the serving of food in the city, at which white and colored people are served in the same room, unless such white and colored persons are effectually separated by a solid partition extending from the floor upward to a distance of seven feet or higher, and unless a separate entrance from the street is provided for each compartment.'
5
'The defendant may plead more pleas than one without unnecessary repetition; and, if he does not rely solely on a denial of the plaintiff's cause of action, must plead specially the matter of defense.'
6
See the printed record in this Court, pp. 24—26.
7
In this connection it is not at all clear that the state rules relating to civil actions apply to all phases of this prosecution. The Court of Appeals referred only to their application to appeals in this type of case, and it may be that the special pleading rule of § 225 does not apply in a trespass prosecution. The Alabama cases cited by the Court of Appeals, see 41 Ala.App., at 315, 316, 133 So.2d, at 699, shed no light on this question, and respondent has not referred to any other relevant authority.
8
Code of Durham (1947), c. 13, § 42: 'In all licensed restaurants, public eating places and 'weenie shops' where persons of the white and colored races are permitted to be served with, and eat food, and are allowed to congregate, there shall be provided separate rooms for the separate accommodation of each race. The partition between such rooms shall be constructed of wood, plaster or brick or like material, and shall reach from floor to the ceiling. Any person violating this section shall, upon conviction, pay a fine of ten dollars and each day's violation thereof shall constitute a separate and distinct offense.'
9
At the trial testimony was introduced showing that Gober and Davis (two of the 10 defendants in the Gober case), as well as 'other persons' who 'were present * * * in the Court room' when the defendants in the Gober case were tried for trespass, attended the meeting at Shuttlesworth's house. There was also testimony that 'other boys who attended the meeting' participated in 'sitins' in Birmingham on the same day that the Gober 'sit-ins' occurred. The record does not reveal whether the Gober defendants were the only persons who participated in the 'sit-ins,' nor whether there were others who were incited by Shuttlesworth but who did not thereafter take part in 'sit-in' demonstrations. The trial court's statement that 'you have here the ten students and the Court thinks they were misused and misled into a violation of a City Ordinance' was made in the course of sentencing the Gober defendants, not Shuttlesworth or Billups (the trials of both of these groups of defendants having been conducted seriatim by the same judge, who reserved sentencing until all trials had been completed). It was in no sense a finding of fact with respect to the crimes with which Shuttlesworth and Billups had been charged.
10
See Pollitt, Dime Store Demonstrations: Events and Legal Problems of First Sixty Days. Duke L.J. (1960) 315, 317—337. Apparently the state courts took judicial notice of such demonstrations in Alabama, which they evidently had the right to do. See, e.g., Green v. Mutual Benefit Health & Accident Ass'n, 267 Ala. 56, 99 So.2d 694, 72 A.L.R.2d 549.
11
See Wechsler, Jones and Korn, The Treatment of Inchoate Crimes in the Model Penal Code of the American Law Institute: Attempt, Solicitation, and Conspiracy, 61 Col.L.Rev. 571, 621—628 (1961).
| 12
|
373 U.S. 334
83 S.Ct. 1236
10 L.Ed.2d 383
Albert ANDREWS, Petitioner,v.UNITED STATES. Robert L. DONOVAN, Petitioner, v. UNITED STATES.
Nos. 491 and 494.
Argued March 25 and 26, 1963.
Decided May 20, 1963.
E. Barrett Prettyman, Jr., Washington, D.C., for petitioners.
Wayne G. Barnett, Washington, D.C., for respondent.
Mr. Justice STEWART delivered the opinion of the Court.
1
The two petitioners and a co-defendant were convicted in a Federal District Court upon a three-court indictment charging that they had (1) assaulted a Post Office employee with intent to rob in violation of 18 U.S.C. § 2114, (2) put the life of the Post Office employee in jeopardy by the use of a dangerous weapon in violation of 18 U.S.C. § 2114, and (3) conspired together to violate the aforesaid statute in violation of 18 U.S.C. § 371. The district judge sentenced each defendant to concurrent prison terms of 25 years on Count 2 and five years on Count 3.1 None of the defendants was asked before the sentences were imposed whether he had anything to say in his own behalf. On appeal, the convictions were affirmed, but the cases were remanded to the District Court for resentencing on Count 2, on the ground that the trial judge had been in error in thinking that under the statute2 he was without power to suspend sentence and grant probation on that count. United States v. Donovan, 2 Cir., 242 F.2d 61. Upon remand, the District Court suspended the 25-year sentence which had been imposed on the petitioners' co-defendant, but resentenced the two petitioners to 25-year prison terms. Again, neither petitioner was afforded an opportunity to speak in his own behalf before the sentences were imposed. The Court of Appeals reaffirmed the convictions. United States v. Donovan, 2 Cir., 252 F.2d 788.
2
The proceedings now before us began when the petitioner Donovan filed a motion in the District Court requesting that his sentence 'be vacated and he be resentenced' on the ground that, contrary to Rule 32(a) of the Federal Rules of Criminal Procedure, he had been afforded no opportunity to make a statement in his own behalf either at the time of the original sentence or when the sentence was reimposed.3 The District Court granted the motion and ordered that Donovan 'be returned to this district for resentencing.' The petitioner Andrews then wrote to Judge Murphy, the district judge who had acted on Donovan's motion, pointing out that 'the identical circumstances exist with me' and asking for similar relief. Judge Murphy ordered that Andrews too be returned to the District Court for resentencing. The Government filed a notice of appeal from both orders, and the resentencing of the petitioners was stayed upon the Government's motion. The Court of Appeals ruled that its appellate jurisdiction had been properly invoked, and on the merits reversed the orders of the District Court, holding that under this Court's decisions in Hill v. United States, 368 U.S. 424, 82 S.Ct. 468, 7 L.Ed.2d 417 and Machibroda v. United States, 368 U.S. 487, 82 S.Ct. 510, 7 L.Ed.2d 473, the sentencing court's failure to comply with Rule 32(a) did not constitute a ground for collateral relief. 2 Cir., 301 F.2d 376. We granted certiorari, 371 U.S. 812, 83 S.Ct. 57, 9 L.Ed.2d 54.
3
As to the merits of the issue decided by the Court of Appeals, the petitioners contend that there was here not a mere failure to comply with the formal requirements of Rule 32(a) as in Hill and Machibroda, but that a number of aggravating circumstances accompanied the sentencing court's denial of the petitioners' right of allocution. And the Court's opinions in Hill and Machibroda, say the petitioners, clearly implied that collateral relief would be available in a case where such circumstances were shown to exist. Cf. United States v. Taylor, 4 Cir., 303 F.2d 165, 167—168. But the petitioners argue preliminarily that the Government had no right of appeal in these cases. We agree with the petitioners that the Court of Appeals did not have appellate jurisdiction, and accordingly, without reaching the merits, we set aside the judgment of the Court of Appeals and remand the cases to the District Court so that the petitioners may be resentenced in accordance with the District Court's orders.
4
The motion which Donovan filed in the sentencing court was denominated by him as one made under Rule 35 of the Federal Rules of Criminal Procedure.4 Anderson's letter did not mention Rule 35, but in an affidavit opposing Anderson's request, an Assistant United States Attorney conceded that the 'factual and legal posture of this application therefore is identical to the similar motion of Robert L. Donovan.' Both applications were filed in the District Court under the docket number of the original criminal case.
5
In view of this treatment of the motions by the parties and the trial court, the Court of Appeals was asked to consider the motions also as filed in the original criminal cases under Rule 35, and to hold that the trial court's rulings could not be appealed by the Government because they did not come within the limited purview of the Criminal Appeals Act.5 This reasoning the Court of Appeals declined to adopt, treating the motions instead as having been brought under the provisions of 28 U.S.C. § 2255.
6
The court was correct in regarding Hill v. United States, supra, as requiring this view, in the case of a prisoner in custody under the sentence he is attacking. Cf. United States v. Morgan, 346 U.S. 502, 74 S.Ct. 247, 98 L.Ed. 248. And in this area of the law, as the Court of Appeals pointed out, 'adjudication upon the underlying merits of claims is not hampered by reliance upon the titles petitioners put upon their documents.' 301 F.2d, at 378. See Heflin v. United States, 358 U.S. 415, 79 S.Ct. 451, 3 L.Ed.2d 407. Section 2255 explicitly authorizes a prisoner in custody under a sentence imposed by a federal court to attack such a sentence collaterally upon the ground that the sentence 'was imposed in violation of the * * * laws of the United States,' by moving the trial court 'to vacate, set aside or correct the sentence.'6
7
An action under 28 U.S.C. § 2255 is a separate proceeding, independent of the original criminal case. United States v. Hayman, 342 U.S. 205, 72 S.Ct. 263, 96 L.Ed. 232. The Criminal Appeals Act has no applicability to such a proceeding. Instead, § 2255 itself provides that 'An appeal may be taken to the court of appeals from the order entered on the motion as from a final judgment on application for a writ of habeas corpus.' We cannot agree with the Court of Appeals, however, that under this provision the Government had a right to take appeals at the time it sought to do so in these cases, because we think it clear that the orders were interlocutory, not final. For a federal prisoner § 2255 can perform the full service of habeas corpus, by effecting the immediate and unconditional discharge of the prisoner. Sanders v. United States, 372 U.S. 1, 83 S.Ct. 1068 (1963). But the provisions of the statute make clear that in appropriate cases a § 2255 proceeding can also be utilized to provide a more flexible remedy. In the present cases neither of the petitioners ever asked for his unconditional release. What they asked, and were granted, was the vacation of the sentences they were serving so that they might be returned to the trial court to be resentenced in proceedings in which their right to allocution would be accorded them. Such a remedy is precisely authorized by the statute. Under § 2255 a petitioner may 'move the court which imposed the sentence to vacate, set aside or correct the sentence.'7 And in response to such a motion a District Court is expressly authorized to 'discharge the prisoner or resentence him or grant a new trial or correct the sentence as may appear appropriate.'8 Where, as here, what was appropriately asked and appropriately granted was the resentencing of the petitioners, it is obvious that there could be no final disposition of the § 2255 proceedings until the petitioners were resentenced. Cf. Parr v. United States, 351 U.S. 513, 518, 76 S.Ct. 912, 916, 100 L.Ed. 1377.
8
The long-established rule against piecemeal appeals in federal cases and the overriding policy considerations upon which that rule is founded have been repeatedly emphasized by this Court. See, e.g., DiBella v. United States, 369 U.S. 121, 82 S.Ct. 654, 7 L.Ed.2d 614; Carroll v. United States, 354 U.S. 394, 77 S.Ct. 1332, 1 L.Ed.2d 1442; Cobbledick v. United States, 309 U.S. 323, 60 S.Ct. 540, 84 L.Ed. 783. The standards of finality to which the Court has adhered in habeas corpus proceedings have been no less exacting. See, e.g., Collins v. Miller, 252 U.S. 364, 40 S.Ct. 347, 64 L.Ed. 616. There the Court said that the rule as to finality 'requires that the judgment to be appealable should be final not only as to all the parties, but as to the whole subject-matter and as to all the causes of action involved.' 252 U.S., at 370, 40 S.Ct. at 349.
9
The basic reason for the rule against piecemeal interlocutory appeals in the federal system is particularly apparent in the cases before us. Until the petitioners are resentenced, it is impossible to know whether the Government will be able to show any colorable claim of prejudicial error. The District Court may, as before, sentence the petitioners to the same 25 years' imprisonment; it may place one or both of them on probation; it may make some other disposition with respect to their sentences. But until the court acts, none of the parties to this controversy will have had a final adjudication of his claims by the trial court in these § 2255 proceedings.
10
The judgment of the Court of Appeals is set aside, and the cases are remanded to the District Court for the Southern District of New York for further proceedings consistent with this opinion. It is so ordered.
11
Judgment Court of Appeals set aside and cases remanded to the District Court with directions.
1
No sentence was imposed on Count 1, because the court concluded that the conviction under this court had merged with the conviction under Count 2.
2
'Whoever assaults any person having lawful charge, control, or custody of any mail matter or of any money or other property of the United States, with intent to rob, steal, or purloin such mail matter, money, or other property of the United States, or robs any such person of mail matter, or of any money, or other property of the United States, shall, for the first offense, be imprisoned not more than ten years; and if in effecting or attempting to effect such robbery he wounds the person having custody of such mail, money, or other property of the United States, or puts his life in jeopardy by the use of a dangerous weapon, or for a subsequent offense, shall be imprisoned twenty-five years.' 18 U.S.C. § 2114.
3
Rule 32(a), Federal Rules of Criminal Procedure, provides in pertinent part as follows: 'Before imposing sentence the court shall afford the defendant an opportunity to make a statement in his own behalf and to present any information in mitigation of punishment.'
4
Rule 35 provides in pertinent part as follows: 'The court may correct an illegal sentence at any time.'
5
18 U.S.C. § 3731. The Government makes no claim of a right to appeal under the Criminal Appeals Act. No question as to the availability of a writ of mandamus is presented by this case. See United States v. Smith, 331 U.S. 469, 67 S.Ct. 1330, 91 L.Ed. 1610. Cf. United States v. Mayer, 235 U.S. 55, 35 S.Ct. 16, 59 L.Ed. 129.
6
The first paragraph of 28 U.S.C. § 2255 provides:
'A prisoner in custody under sentence of a court established by Act of Congress claiming the right to be released upon the ground that the sentence was imposed in violation of the Constitution or laws of the United States, or that the court was without jurisdiction to impose such sentence, or that the sentence was in excess of the maximum authorized by law, or is otherwise subject to collateral attack, may move the court which imposed the sentence to vacate, set aside or correct the sentence.'
7
See note 6, supra.
8
The third paragraph of § 2255 provides: 'Unless the motion and the files and records of the case conclusively show that the prisoner is entitled to no relief, the court shall cause notice thereof to be served upon the United States attorney, grant a prompt hearing thereon, determine the issues and make findings of fact and conclusions of law with respect thereto. If the court finds that the judgment was rendered without jurisdiction, or that the sentence imposed was not authorized by law or otherwise open to collateral attack, or that there has been such a denial or infringement of the constitutional rights of the prisoner as to render the judgment vulnerable to collateral attack, the court shall vacate and set the judgment aside and shall discharge the prisoner or resentence him or grant a new trial or correct the sentence as may appear appropriate.'
| 01
|
373 U.S. 374
83 S.Ct. 1311
10 L.Ed.2d 419
James GOBER et al., petitioners,v.CITY OF BIRMINGHAM.
No. 66.
Supreme Court of the United States
October Term, 1962.
May 20, 1963
Mrs. Constance B. Motley, New York City, for petitioners.
Watts E. Davis, Birmingham, Ala., for respondent.
J. M. Breckenridge, Birmingham, Ala., for respondent.
Solicitor General Archibald Cox for the United States, as amicus curiae, by special leave of Court.
On Writ of Certiorari to the Court of Appeals of the State of Alabama.
PER CURIAM.
1
The judgments are reversed. Peterson v. City of Greenville, 373 U.S. 244, 83 S.Ct. 1119.
2
[For opinion of MR. JUSTICE HARLAN, see 373 U.S. 248, 83 S.Ct. 1133.]
| 12
|
373 U.S. 294
83 S.Ct. 1266
10 L.Ed.2d 357
WISCONSIN et al., Petitioners,v.FEDERAL POWER COMMISSION et al. CALIFORNIA et al., Petitioners, v. FEDERAL POWER COMMISSION et al. LONG ISLAND LIGHTING CO. et al., Petitioners, v. FEDERAL POWER COMMISSION et al.
Nos. 72, 73 and 74.
Argued Jan. 9, 1963.
Decided May 20, 1963.
Kent H. Brown, Albany, N.Y., for petitioners in No. 72.
William M. Bennett, Chief Counsel, California Public Utilities Commission, for petitioners in No. 73.
J. David Mann, Jr., Washington, D.C., for petitioners in No. 74.
Richard A. Solomon, Washington, D.C., for respondent Federal Power Commission in all three cases.
Kenneth Heady for respondent Phillips Petroleum Company in all three cases.
Mr. Justice HARLAN delivered the opinion of the Court.
1
Almost nine years have passed since this Court's decision in Phillips Petroleum Co. v. Wisconsin, 347 U.S. 672, 74 S.Ct. 794, 98 L.Ed. 1035, holding that the Federal Power Commission has jurisdiction over the rates charged by an independent producer of natural gas. The present case, involving the same independent producer, Phillips Petroleum (Phillips),1 is a sequel to that earlier decision and strikingly illustrates the unique problems confronting the Commission in its efforts to achieve the goal of effective regulation
I.
2
Following the remand in the Phillips case, the Commission, proceeding under § 5(a) of the Natural Gas Act,2 reinstituted its general investigation of the lawfulness of Phillips' rates with respect to its sales of natural gas in interstate commerce. Later, it consolidated with that investigation 12 proceedings under § 4(e) of the Act3 which involved the lawfulness of certain specific rate increases filed by Phillips under § 4(d) between June 1954 and May 1956. All of these rate increases had been suspended by the Commission for the maximum five-month period permitted by the statute (§ 4(e)) and had subsequently gone into effect subject to refund of any portion that might ultimately be found excessive (ibid.). With one minor exception, each of these increases had been superseded by a subsequent increase,4 all of which were in turn suspended and are the subject of separate § 4(e) proceedings not now before us.5
3
Hearings in these consolidated proceedings did not begin until June 1956 and extended over a period of almost 18 months. All parties proceeded on the assumption that the lawfulness of Phillips' rates was to be determined on the basis of its jurisdictional cost of service for the test year 1954,6 and four full-scale cost-of-service studies were presented. A Commission Examiner in April 1959 issued a comprehensive decision (24 F.P.C. 590) comprising over 200 pages, in which he found that Phillips' jurisdictional cost of service for the test year was $57,280,218. He then ordered Phillips to calculate a rate which, when applied to 1954 volumes, would produce revenues substantially equal to its test year cost of service. This rate, with appropriate adjustments for quality, pressure, etc., was to be applied to all of the company's rate schedules on file with the Commission at the time of Commission approval.
4
Over one year later, in September 1960, the Commission issued the opinion that is the subject of the present litigation. 24 F.P.C. 537. Its basic conclusion was that the individual company cost-of-service method, based on theories of original cost and prudent investment, was not a workable or desirable method for determining the rates of independent producers and that the 'ultimate solution' lay in what has come to be known as the area rate approach: 'the determination of fair prices for gas, based on reasonable financial requirements of the industry' for each of the various producing areas of the country. 24 F.P.C., at 547. This means that rates would be established on an area basis, rather than on an individual company basis. As initial steps toward this end, the Commission did two things at the same time it issued the opinion in these proceedings. First, it promulgated a Statement of General Policy (S.G.P. 61—1), since amended on several occasions, in which it set forth area-by-area 'price levels' for initial and increased rate filings by producers, and stated that in the absence of compelling evidence it would not certificate initial rates, and would suspend increased rates, which exceeded these price levels.7 Second, the Commission announced that it would begin a series of hearings, each designed to cover a major producing area. (At least one of these hearings, involving the Permian Basin, is now well under way.)
5
The Commission, in its opinion here, gave several reasons for rejecting as unsuitable the individual company cost-of-service method. 24 F.P.C., at 542—548. In particular it emphasized that, unlike the business of a typical public utility, the business of producing natural gas involved no fixed, determinable relationship between investment and service to the public. A huge investment might yield only a trickle of gas, while a small investment might lead to a bonanza. Thus the concept of an individual company's 'prudent investment,' as a basis for calculating rates that would call forth the necessary capital and also protect consumers from excessive charges, seemed wholly out of place. Further, the Commission noted that the individual company cost-of-service method gave rise to staggering cost allocation problems, could result in such anomalies as widely varying prices for gas coming from a single field and even from a single jointly owned well, and would create an intolerable administrative burden in requiring a separate rate determination for each of the several thousand independent producers.
6
Returning to the proceedings before it, the Commission decided that, despite its disapproval of the cost-of-service method, the whole case having been tried on that basis, a final administrative determination of cost of service for the test year should be made. It then proceeded to resolve a number of difficult questions, including those relating to allocation of production and exploration costs, allocation of costs between natural gas and extracted liquids, and rate of return, and arrived at a system-wide jurisdictional cost of service for the test year of $55,548.054—a figure which substantially exceeded jurisdictional revenues ($45,568,291) for that year.8
7
With this determination in hand, the Commission turned to the consolidated § 4(e) proceedings, involving specific rate increases filed through May 1956, and found that those increases had produced increased revenues of only about $5,250,000 annually, or considerably less than the total deficit for the test year. It also stated that there was nothing in the record to show that any of the increased rates were 'unduly discriminatory or preferential.' It then concluded that since it could not order refunds of any portion of these increases, in view of the continuing deficit, and since all increases had been superseded, there would be no purpose in continuing the § 4(e) proceedings and, with two exceptions, they were were terminated.
8
The two exceptions concerned rate increases under 'spiral escalation' clauses in Phillips' contracts,9 and these two proceedings were kept open because the proper amount of the particular increases depended on the amount of increases, if any, allowed to certain pipeline customers of Phillips in their own rate proceedings then pending before the Commission. The Commission refused to hold such spiral clauses void ab initio, and in fact a rate increase in one of the 10 terminated § 4(e) proceedings had resulted from the operation of a spiral escalation clause.
9
The Commission recognized that there remained almost 100 other § 4(e) proceedings, involving increases filed by Phillips, that had not been consolidated in this case. It said that since the present record indicated that Phillips' costs exceeded revenues at least through 1958 it was inviting Phillips to file motions to terminate all § 4(e) proceedings relating to increases filed prior to 1959, thus limiting future consideration of Phillips' rates to 1959 and after. Whether this invitation has been accepted by Phillips is not disclosed, but in any event none of these other § 4(e) proceedings is before us now.
10
Turning to the § 5(a) investigation of the lawfulness of Phillips' existing rates, the Commission first noted that there was considerable disagreement over how these rates should be set whether they should be approximately uniform throughout the country or should vary from area to area. It then said that it was aware that both costs and prices had greatly increased since 1954 (and especially after 1958) and it therefore did not 'deem it appropriate to prescribe or require that Phillips file rates for the future based upon the present record.' 24 F.P.C., at 575—576. Concluding that the public would be adequately protected by Phillips' potential refund obligations under § 4(e), by the area pricing standards announced in the Statement of General Policy, and by the area rate proceedings to be intiated, the Commission ordered the termination of the present § 5(a) investigation.
11
On application for rehearing, the Commission rejected the suggestion that it should reopen the case for submission of 1959 cost data. 24 F.P.C. 1008. It said that the 'interest of consumers and the exigencies of regulation will be better served in rate proceedings brought on an area basis rather than on an individual company basis,' and that the area method would lead to 'more effective and expeditious regulation of the producer sales.' 24 F.P.C., at 1009. It also rejected the claim that it had erred in terminating the § 4(e) proceedings because some of the increased rates were inexcess of the average unit cost of service, reiterating that there had been no showing of undue discrimination or preference and that the total revenue resulting from the increases did not make up the deficit shown by the test year determination.
12
On review, the Court of Appeals, in a thorough and informative opinion, affirmed the decision of the Commission. 112 U.S.App.D.C. 369, 303 F.2d 380. Judge Fahy, dissenting in part, argued that whether or not the area rate method of rate regulation was the ultimate solution, the Commission having gone so far in this proceeding should have finished it by deciding on a cost-of-service basis the justness and reasonableness of Phillips' past increases and of its present rates. To have failed to do so, he believed, was a clear abuse of discretion. We granted certiorari because of the importance of this case in the administration and future operation of the Natural Gas Act. 369 U.S. 870, 82 S.Ct. 1139, 8 L.Ed.2d 275.
13
The arguments of the parties, both in their briefs and at the bench, have covered a broad range of subjects, including a number of other administrative actions and proceedings—past, present, and future—that are not before us today. We lay these collateral subjects to one side and focus on the three precise questions that have been brought here for review: whether the Commission erred (1) in refusing to reject certain increased rates because they were based on spiral escalation clauses; (2) in terminating the 10 consolidated § 4(e) proceedings involving increases now superseded and in leaving two such proceedings open only for a limited purpose; or (3) in discontinuing the § 5(a) investigation of the lawfulness of Phillips' current rates. Of these three questions, which will be considered in the order stated, the third is the only one vigorously pressed by all petitioners and is clearly the principal issue in the case
II.
14
California, alone among the petitioners, challenges the Commission's refusal to declare void ab initio the spiral escalation clauses in Phillips' contracts on which rate increases in three of the 12 § 4(e) dockets were based.10 Such clauses, California contends, are manifestly inconsistent with the public interest, because they constitute a price mechanism by which '(c)onsumers of natural gas are caught in a maelstrom.'
15
But we have at least grave doubts that this question may be raised by California at this time. As to two of the three dockets, the claim would appear premature, since the dockets are still pending, and the increases there involved may eventually be disallowed if the pipeline increases on which they depend are themselves disallowed by the Commission. As to the third docket, the particular increase has been made fully effective by termination of the § 4(e) proceeding, but since the sale in question is to the Michigan-Wisconsin pipeline and appears to affect no California interests, no one whom California may properly represent is 'aggrieved' (§ 19 (b))11 by the Commission's order.
16
Further, we see no merit in California's contention. It is true that the Commission has announced prospectively that it would not accept for filing contracts containing such clauses,12 but it would have been quite a different matter for the Commission to have declared that past rate increases were ineffective simply because they were based on spiral provisions. The effect of a contract clause of this type, of course, is only to permit the producer to resort to the filing provisions of § 4(d) of the Act. If the increase is challenged, the producer must still establish its lawfulness wholly apart from the terms of the contract. Thus we have sustained the right of a seller to file an increase under a contract which, in effect, authorized him to do so at any time. United Gas Pipe Line Co. v. Memphis Light, Gas and Water Division, 358 U.S. 103, 79 S.Ct. 194, 3 L.Ed.2d 153. The spiral clauses here are far more limited in scope, depending as they do on the occurrence of external events.
III.
17
The claim that the Commission erred in terminating 10 § 4(e) dockets, and leaving two others open only for a limited purpose, is pressed primatrily by Wisconsin and New York. In considering their contentions, it should be noted again that all of the rate increases involved were filed prior to the end of 1956, and have since been superseded or 'locked in' by subsequent increases13 which, with one exception, have been suspended and made the subject of separate § 4(e) proceedings.
18
The Commission's termination of these § 4(e) dockets was a decision on the merits. It was based on the finding that the annual increase in revenue produced by these increased rates was substantially less than the deficit for the test year 1954. Petitioners' principal objection appears to be that Phillips' overall, and unit (per Mcf.), revenues increased so substantially that they may have exceeded costs during the 1955—1959 period for which the increases were allowed. But the fact is that Phillips' average unit revenues during this period never rose significantly above its test year unit revenue requirements as determined by the Commission.14 Moreover, petitioners do not claim, nor could they on this record, that the test year cost of service was higher per unit than in subsequent years. And assuming that unit costs did not decline, it is clear that the increases here did not even bring unit revenues up to those unit costs. Whether other subsequent increases involved in separate proceedings not before us resulted in revenues exceeding cost of service in later years has no effect on the propriety of terminating these § 4(e) dockets. Thus the factors that may have made the record stale for purposes of determining in the § 5(a) investigation whether Phillips' present rates are unjust or unreasonable do not make the record stale for purposes of determining the lawfulness of these past increases.
19
Petitioners also claim that the Commission terminated the § 4(e) proceedings improperly because it failed to make any finding that the increased rates in question were just and reasonable. But this contention goes to the form and not the substance of what the Commission did. Since these increased rates were 'locked in,' their validity for the future was not at issue; the sole question was whether all or any part of the increases had to be refunded by Phillips. Having decided on the basis of substantial evidence that the increases did not bring revenues up to cost of service, the Commission properly concluded, on the only matter before it with respect to these dockets, that no refund obligation could be imposed.
20
It was urged on rehearing before the Commission, and in the court below, that some of the increased rates were above average cost of service and that at most the Commission should have terminated only those § 4(e) dockets in which the increased rates did not exceed the average unit cost of service. The Commission rejected this contention, stating that Phillips' rates would normally vary greatly because sales were made at widely separated points and under different conditions, and that there was little or nothing to be gained by entering a protracted investigation of allocation of costs to particular past rates 'when it is already known that Phillips was not earning its whole cost of service.' 24 F.P.C., at 1009.
21
We believe this conclusion was justified,15 and petitioners appear to have all but abandoned the theory that some of the § 4(e) dockets were improperly terminated merely because the particular increased rates in those dockets exceeded average cost. Rather, they now urge that the variation in the increased rates was so great as to compel the conclusion that they were 'discriminatory and preferential per se.' The Commission noted that there was nothing in the record to show unlawful discrimination, and it is clear that mere differences in rates under this Act are not per se unlawful. But in any event, we need not reach the merits of the claim of discrimination because it is not properly before us. It was not presented to the court below, nor was it adequately raised on application to the Commission for rehearing, a step required by § 19(b) of the Act in order to preserve a point for judicial review. See, e.g., Sunray Mid-Continent Oil Co. v. Federal Power Comm'n, 364 U.S. 137, 157, 80 S.Ct. 1392, 1403—1404, 4 L.Ed.2d 1623.
IV.
22
The final question is whether the Commission was justified in terminating the § 5(a) investigation of the reasonableness of Phillips' current rates. Preliminarily, it is important to observe that the Commission's accomplishments since the original Phillips case, the validity of the Statement of General Policy 61—1, the actions taken pursuant to it, and the lawfulness of the area pricing method are not themselves before the Court for review. To a limited extent, however, these matters do bear upon the propriety of the Commission's decision to terminate this § 5(a) proceeding.
23
As the petitioners recognize, the issue is whether the termination constituted an abuse of discretion, a discretion which in general is broad but which the petitioners urge is a good deal narrower in a proceeding that has gone this far than in the case of a decision whether or not to initiate an inquiry. See Minneapolis Gas Co. v. Federal Power Comm'n, 111 U.S.App.D.C. 16, 294 F.2d 212. Underlying petitioners' position are their claims that the result of the termination is little or no effective regulation in the interim period before the development of area rate regulation, that such regulation may take many years to evolve, and that the method may eventually be held invalid.
24
1. The petitioners are not of one mind as to the feasibility and lawfulness of the area rate method of regulation, although no one questions the Commission's right to undertake the experiment. California appears to come closest to the view that the individual company cost-of-service method is the only lawful basis for rate regulation and that the invalidity of the area approach is therefore predictable. If we believed that such a departure from present concepts had little, if any, chance of being sustained, we would be hard pressed to say that the Commission had not abused its discretion in terminating this § 5(a) proceeding while undertaking the area experiment. For if area regulation were almost sure to fail, and if the individual company cost-of-service method of determining the reasonableness of rates had been abandoned, then there would be virtually no foreseeable prospect of effective regulation. Difficult as the problems of cost-of-service regulation may be, they would not warrant a breakdown of the administrative process.
25
But to declare that a particular method of rate regulation is so sanctified as to make it highly unlikely that any other method could be sustained would be wholly out of keeping with this Court's consistent and clearly articulated approach to the question of the Commission's power to regulate rates. It has repeatedly been stated that no single method need be followed by the Commission in considering the justness and reasonableness of rates, Federal Power Comm'n v. Natural Gas Pipeline Co., 315 U.S. 575, 62 S.Ct. 736, 86 L.Ed. 1037; Federal Power Comm'n v. Hope Natural Gas Co., 320 U.S. 591, 64 S.Ct. 281, 88 L.Ed. 333; Colorado Interstate Gas Co. v. Federal Power Comm'n, 324 U.S. 581, 65 S.Ct. 829, 89 L.Ed. 1206, and we reaffirm that principle today. As the Court said in Hope:
26
'We held in Federal Power Commission v. Natural Gas Pipeline Co., supra, that the Commission was not bound to the use of any single formula or combination of formulae in determining rates. Its rate-making function, moreover, involves the making of 'pragmatic adjustments.' Id., 315 U.S. at page 586, 62 S.Ct. at page 743, 86 L.Ed. 1037. And when the Commission's order is challenged in the courts, the question is whether that order 'viewed in its entirety' meets the requirements of the Act. Id., 315 U.S. at page 586, 62 S.Ct. at page 743, 86 L.Ed. 1037. Under the statutory standard of 'just and reasonable' it is the result reached not the method employed which is controlling.' 320 U.S. at 602, 64 S.Ct., at 287, 288, 88 L.Ed. 333.
27
More specifically, the Court has never held that the individual company cost-of-service method is a sine qua non of natural gas rate regulation. Indeed the prudent investment, original cost, rate base method which we are now told is lawful, established, and effective is the very one the Court was asked to declare impermissible in the Hope case, less than 20 years ago.
28
To whatever extent the matter of costs may be a requisite element in rate regulation, we have no indication that the area method will fall short of statutory or constitutional standards. The Commission has stated in its opinion in this proceeding that the goal is to have rates based on the 'reasonable financial requirements of the industry' in each production area, 24 F.P.C., at 547, and we were advised at oral argument that composite cost-of-service data will be considered in the area rate proceedings. Surely, we cannot say that the rates to be developed in these proceedings will in all likelihood be so high as to deprive consumers, or so low as to deprive producers, of their right to a just and reasonable rate.16
29
We recognize the unusual difficulties inherent in regulating the price of a commodity such as natural gas.17 We respect the Commission's considered judgment, backed by sound and persuasive reasoning, that the individual company cost-of-service method is not a feasible or suitable one for regulating the rates of independent producers. We share the Commission's hopes that the area approach may prove to be the ultimate solution.
30
2. This is not a case in which the Commission has walked right up to the line and then refused to cross it—a case, in other words, in which all the evidence necessary to a determination had been received but the determination was not made. Here, the Commission concluded that the record, relating to the test year 1954, was too stale in 1960 to permit a finding as to the justness and reasonableness of Phillips' current rates. In view of this inadequacy, and since the Commission must establish the unlawfulness of present rates before taking further action in a § 5(a) proceeding, continuation of the proceeding would have required remanding the case for the receipt of evidence as to costs in at least one subsequent test year. None of the petitioners specifically challenges the Commission's conclusion that, for § 5(a) purposes, the record was stale in 1960; a fortiori it is stale today918
31
Thus the question whether the Commission abused its discretion in terminating the proceeding must be measured against the only alternative: remanding for additional evidence. Such a remand undoubtedly would have consumed considerable time and energy, including that of the Commission and its staff, and would almost certainly have involved another decision by a hearing examiner, another appeal to the Commission, another petition for rehearing and further judicial review of complex and difficult issues. In short, the alternative rejected by the Commission would not have resulted in definitive regulation of Phillips' rates immediately or in the near future. Indeed, several years might have elapsed before even the method of regulation which the Commission regards as unsuitable would have become effective as to even this one producer.
32
3. It is contended that, as a result of the decision to terminate this § 5(a) proceeding, the public will receive significantly less protection against the charging of excessive prices by Phillips (and others) in the interim period before the area method sees the light of day. Were this the case, it would bear importantly on our review of the Commission's exercise of its discretion. But in this connection several factors should be noted. First, the record before us does not paint a picture of the public interest sacrificed on the altar of private profit. Indications are that at least until 1959 Phillips' jurisdictional revenues did not catch up to its cost of service. Although revenues increased substantially after that time, the Commission observed that costs have also risen dramatically, and we have no basis for assuming that current rates are grossly unreasonable.
33
Second, most of Phillips' increased rates now in effect are the subject of pending § 4(e) proceedings and are thus being collected subject to refund. Refund obligations, it is true, do not provide as much protection as the elimination of unreasonable rates, see Federal Power Comm'n v. Tennessee Gas Transmission Co., 371 U.S. 145, 154—155, 83 S.Ct. 211, 216—217, 9 L.Ed.2d 199, but they are undoubtedly significant and cannot be ignored, as some of the petitioners would have us do.
34
Third, it is clear that since the Commission's decision in this proceeding, the upward trend in producer prices has been substantially arrested, and in at least one important area the trend has actually been downward.19 Although the Statement of General Policy did not purport to establish just and reasonable rates, see note 7, supra, the price levels declared in that statement, along with implementation of the program there announced, appear to have played a significant role in accomplishing this result.
35
Fourth, it must be remembered that the problem of this transitional period would still exist if the present § 5(a) proceeding were reopened for the taking of new evidence; there is no way of predicting how much time would be required for a final decision to be rendered, but it would inevitably be substantial. It is therefore evident that the choice is not between protection or no protection. There will in either event be some protection, though doubtless with room for improvement, for several years.
36
Petitioners claim that forcing the Commission to reopen this § 5(a) investigation will not unduly delay area rate proceedings and will in fact provide useful information for area rate-making purposes. The Commission, with equal vigor, states that it does not have the facilities to reopen this case (and all others that have reached approximately the same stage) and at the same time to proceed expeditiously with its area investigations. It estimates that the Permian Basin area proceedings, a case involving some 35% of Phillips' jurisdictional sales and roughly 10% of sales by all producers, will be completed in about the same time that would be required to complete a remanded § 5(a) proceeding relating to Phillips alone. It warns that if it is required to reopen this and similar proceedings, the result may be to delay unduly the area investigations, while compelling adherence to a method the Commission deems unworkable, thus providing significantly less protection for the public both in the long and the short run.
37
The Court cannot resolve this dispute against the Commission and tell it that it has made an error of law—abused its discretion in deciding how best to allocate its resources. The case might be different if the area approach had little or no chance of being sustained; if the present record were now ripe for determination of reasonable rates for Phillips on an individual company cost-of-service basis; or if it were manifest that the public would receive significantly less protection in the interim period than if the proceeding had not been terminated. But as we have already concluded, none of these conditions exists, and in their absence a reversal of the Commission would be a sheer act of interference in the details of the administrative process. Indeed, it might well have the effect of postponing even further the time when effective regulation will be realized.
38
Finally, the fact that the Commission in this case terminated the § 5(a) proceedings, rather than merely holding them in abeyance as it did in Hunt Oil Co., 28 F.P.C. 623,20 is a circumstance of no significance. At the oral argument general counsel for the Commission assured us that the Commission remains free to reactivate the investigation of Phillips' individual rates if the area proceedings are unduly delayed or if circumstances should otherwise warrant. The distinction between termination and suspension of the § 5(a) proceedings is thus on of form and not of substance. In either event the Commission retains the flexibility it must have at this still formative period in a difficult area of rate regulation.
39
Affirmed.
40
MR. JUSTICE CLARK, with whom THE CHIEF JUSTICE, MR. JUSTICE BLACK and MR. JUSTICE BRENNAN join, dissenting.
41
The Sisyphean labors of the Commission continue as it marches up the hill of producer regulation only to tumble down again with little undertaken and less done. After 16 years without regulation under the Act, resulting from the Commission's position that it had no jurisdiction over the production of gas, this Court decided Phillips Petroleum Corp. v. Wisconsin, 347 U.S. 672, 74 S.Ct. 794, 98 L.Ed. 1035 (1954).1 The Court there charged the Commission with supervision over Phillips' operating expenses, both producing and gathering, and directed the Commission to fix a just and reasonable rate for the sale of Phillips' gas. Five years later the Presiding Examiner determined Phillips' 1954 cost of service to be 11.662¢ per Mcf. and allowed it a 9.25% rate of return. He directed and Phillips filed a preliminary rate per Mcf. for 1954 and an adjusted rate for subsequent years. A year and a half later the Commission handed down its decision. It found Phillips' 1954 cost of service to be 11.1009¢ per Mcf.2 and determined that a fair return would be 11%. It found Phillips' jurisdictional revenues substantially less in 1954 than these allowables and, contra to the recommendation of the Examiner and its own staff, it terminated all save two of the § 4(e) proceedings, discharged Phillips from further refund obligation thereunder and dismissed its own § 5 investigation of these and subsequent rates covering some 95 substantial rate increases made by Phillips. In addition, it assumed from these 1954 figures that the rates were 'probably' not excessive through 1958 and invited motions to dismiss these proceedings, thus approving existing and increased rates for the 1955—1959 period on the sole basis of 1954 costs and revenues. It also concluded that there was 'nothing in the record to show that these past rates * * * are unduly discriminatory or preferential,' 24 F.P.C., at 576, despite the fact that they varied from 5.5¢ per Mcf. to 13.5¢, with one at 17¢ per Mcf. But this is not all. Concurrently with this action the Commission issued sua sponte a Statement of General Policy No. 61—1, 24 F.P.C. 818, 25 Fed.Reg. 9578, in which it discarded its long-established cost method in favor of an area basis of fixing rates. It promulgated two lists of area prices, one covering initial rates under § 7 certificates and another for increasing rates for gas sold under existing contracts subject to § 4(e). In arriving at these price levels the Commission said that it considered 'all of the relevant facts available to us,' including cost information, 'existing and historical price structures, volumes of production, trends in production, price trends in the various areas over a number of years, trends in exploration and development, trends in demands, and the available markets for the gas.' 24 F.P.C., at 819. For the new gas level § 7 certification price, there can be no doubt that the level established as a guide is the highest permanently certificated rate in the respective areas as of September 1960. The other gas level announced (for § 4(e) contracts) was but the average weighted price for gas sold from the respective areas in 1959. It is therefore accurate to say that both levels were based on existing price structures as of September 1960, i.e., averaged field prices. The Examiner, contrary to the Commission, had found the cost method not only more accurate but entirely feasible and, in comparison with the area method, no more delaying. The parties themselves, including Phillips, concurred in the conclusion that Phillips' rates should be determined by the Examiner on the basis of its over-all cost of service. Nevertheless the Commission held to the contrary and, in addition, issued the statement of policy and accompanying price levels without notice, hearing or record and has since amended them several times in like manner. In this summary fashion the Commission junked its cost-of-service regulation program, wasted a half-dozen years of work thereon and is now experimenting with a new, untried, untested, inchoate program which, in addition, is of doubtful legality.3 As a consequence the consumers of gas all over the United States and particularly in the large metropolitan cities of the Eastern Seaboard, the Midwest and the West Coast will pay for the Commission's area pricing wildgoose chase. I predict that in the end the consumer will find himself to be the biggest goose of the hunt and the small producer the dead duck.
42
I cannot let this pass without saying that, as a result of the Court's approval of the Commission's action here, the gas consumers of this country will suffer irretrievable loss amounting to billions of dollars. I shall now offer a few examples in the Commission's rate-base calculation of 1954 that support this conclusion.
43
1. GROSS ERRORS IN THE COST OF SERVICE COMPUTATIONS.
44
As the Court has pointed out, the Commission terminated not only the § 5(a) proceeding but also 10 consolidated § 4(e) proceedings against Phillips, the latter on the ground that the revenue received by it for the periods involved was less than cost of service. In view of this disposition it is necessary, aside from the contention that there was no basis for dismissal of those proceedings covering years subsequent to 1954 on that year's findings, for us to examine the basis of its cost-of-service findings for 1954. The dismissal orders are all predicated upon the 1954 cost of service and if it be erroneous the whole basis for the orders of dismissal falls. Thus, while the petitioners have not here argued the specific challenges raised before the Commission and the Court of Appeals, their contention that the Commission abused its discretion in terminating the § 4(e) proceedings necessarily includes the question of the validity of the determination of cost of service. In addition, the likelihood that the Court's affirmance will be regarded as an approval of these highly questionable standards for cost-of-service determination, thus fostering their application in other cases, calls for discussion of them.
45
Aside from its direct expenditure for purchased gas4 the largest single item of Phillips' costs appears to be its exploration and development expense, which was allowed in the amount of some $58,313,230 before allocation. We first examine it and other items going into cost of service.
46
(a) Exploration and development, depletion allowance, allocation and interest costs.—Exploration and development expense for 1954 on the books of the company was $47,474,039, including undeveloped lease rentals, drilling tools, expired and surrendered leases, dry holes and land and geological activities. On these expenditures a 'return and taxes' item was allowed of $10,839,194. Why the consumer should pay on these items, particularly 'dry holes' ($11,306,964), expired and surrendered leases ($9,479,898) and undeveloped offshore leases ($17,765,332) is a matter for the experts; but it appears to me that since Phillips charged off the dry holes in its taxes and the consumers got nothing whatever in 1954 from expired and surrendered leases and undeveloped offshore leases, such expense should not be included in the rate base. This expense alone amounted to 4.281¢ per Mcf. of the total allowed cost of service of 11.1009¢. Moreover, in this connection, Phillips also enjoyed a tax depletion allowance of 27 1/2% on all gas production. This allowance for the year 1954 was $44,784,723, giving Phillips a tax saving of over $20,000,000. This latter sum was included in the rate base. However, depletion is allowed as an incentive to exploration and certainly its savings should be deducted from Phillips' total expense in this regard. Since the book deficit between total revenue and cost of service for 1954 was $8,900,000, it appears that a correction of this item alone would turn that deficit into a nice profit.
47
(b) Allocation of cost between oil and gas.—Much of the gas produced for interstate sale is 'associated gas,' i.e., it is produced along with oil and is known as casing-head gas. Fifty-seven percent of Phillips' gas production is associated gas but it accounted for only 13.42% of its combined revenue. In addition some wells produce condensate liquids and condensate gas which must be separated through gasoline plants. The question is how much of the expense of exploration, operation, etc., of wells should be chargeable to gas. Phillips used a B.t.u. method which allocated 61.88% of the expense to gas. The Commission cut this to 32.742%, equivalent to 4.281¢ per Mcf. The Examiner had recommended 30.46% while the Wisconsin experts came up with 20.812% and Pacific with 23.98%. As is noted above only 13.42% of Phillips' combined revenue comes from associated gas while 86.58% comes from oil. Still the Commission has allocated almost one-third of the exploration cost to gas, which only brings in one-seventh of the combined revenue. This is a most important item since each 1% shift means over a half million dollars in the rate base.
48
(c) Purchased gas.—If allowed increased rates Phillips says its cost of gas will rise automatically under its percentage type purchase contracts. This item of $1,671,733 was disallowed by the Examiner since the suppliers were not shown to have been entitled to any increase. As the Commission points out an increase in rate would not increase the percentage Phillips was obligated to pay. It would require Phillips to pay the pro-rata increase in rates due on percentage gas, but it recoups this plus a profit when that gas is sold. I submit, as the Examiner found, that the allowance of this million and a half in the cost basis is erroneous. Increases through automatic escalator clauses—which effect the same result—are not permitted because not based on any increase in cost of production. In approving this practice in percentage contracts the Commission creates a perfect loophole for these producers and invites more contracts of this nature.
49
(d) Interest.—Expense for money borrowed for 1954 amounted to $9,892,308. On its tax return Phillips claimed an allowance of only $3,743,077. This variance in cost of money seems to have occurred by reason of an exchange of Phillips' outstanding bonds for common stock. The Commission allowed the larger figure on the basis that it was a 'known change' that probably would not occur in other years. It is interesting to note that the 'known change' theory was not applied to the 'San Juan transfer' made in 1955.5 If applied there it would have made a difference against Phillips of some $8,000,000 in its 1954 rate base. Certainly common fairness would require the application of the 'known change' theory to all cases, not simply an isolated one.
50
It is readily apparent that the Commission's cost-of-service calculations for 1954 are full of holes. In addition, assuming, as I do not, that the 1954 cost is correct the Commission should not be permitted to extend that cost and the 1954 revenue into subsequent years through 1958 and hold that they too are deficit years. This is, on its face, not in keeping with rate-making procedures. Moreover, the record itself shows the error of the Commission's method. The Examiner found that, on Phillips' own presentation of its costs, the over-all deficiency for 1956 'was not significantly higher than that derived in Phillips' 1954 test year cost of service.' 24 F.P.C., at 773. Phillips' revenues, however, increased each year subsequent to 1954. In 1957 they were some $8,000,000 above 1954; they increased some $17,000,000 in 1958 and about $28,000,000 in 1959. In 1960 revenue was $90,856,248, which was practically twice that of 1954 ($45.6 million). These facts, all known to the Commission, required a reappraisal of the cost of service for all years subsequent to 1954, rather than the arbitrary use of the 1954 figures. The necessary data could have been quickly obtained from Phillips which, of course, had its total revenues readily available and, I am sure, had its cost basis for each § 4 increase likewise calculated.6
51
II. THE DISMISSALS AND THEIR CONSEQUENCES.
52
The real problem, however, is not so much in Phillips' 1954 level, for that has long since gone by the board and the consumer may as well forget it. The increased levels that became effective between 1954 and the date of the decision in April 1959 are the main rub. The Examiner understood this when, in his final order, he directed Phillips to file uniform rates which would, when applied to sales made in 1954, bring Phillips its 1954 costs and allowed return. He further directed that the same schedule of rates be applied to all sales made subsequent to 1954 and through the date of his decision and to all sales thereafter. Under this requirement if the subsequent cost of service did increase and was not offset by increased revenues the company could recoup itself with § 4 rate increases. This the Commission refused to do and thereby left Phillips free to collect rates as high as 23.5¢ per Mcf. and subject to no refund. The Commission excused itself on the ground that there would be no reason to fix Phillips' rates on a cost basis since it was going to adopt the area plan. It also found the staleness of the test year prevented its application to subsequent years but obviously this was not the reason. In the first place, it used the 'stale' test year of 1954 to justify its finding of deficit through 1958. In addition all parties had agreed upon that year. Investigation covered 1955 and 1956. Hearings began in June 1956 and ran through 1957. Phillips itself presented 1956 data, the latest full year at the time of the closing of the hearings. They were used to show that the cost experience of 1954 was identical for all practical purposes with 1956 and the Examiner so found. It required 15 months for the Examiner to decide the case and prepare a more comprehensive and detailed report which reflected his rear grasp of the problems. See 24 F.P.C. 590—818. Thus, like many major administrative proceedings, this one took five to six years to complete. But, I ask, if this makes the test year stale what of all the other major rate cases? Those that reach us not infrequently have been in the Commission for an equal or longer period. Even if stale, the Commission should not have dumped the whole investigation, hearing, Examiner Report, and staff work down the drain. Before doing so, and in the same opinion, it had already laid down detailed standards in the case for determining cost of service. Indeed it had not only determined the cost to Phillips but had formulated the standards governing its rate of return and calculated its allowable return thereunder. All of this it then discarded. Admitting that additional statistics for subsequent years might have been necessary, such data would have been concerned solely with the application of these already determined standards to those years.
53
The dismissal of the § 4(e) and § 5(a) cases is the more unfortunate and indicates a disturbing disregard of the consumer interest. On the § 4(e) cases the Court says 'most of Phillips' increased rates now in effect are the subject of pending § 4(e) proceedings * * *.' At this very moment Phillips is making sales at nonrefundable rates as high as 23.5¢ per Mcf. which produce annual revenues more than $3,000,000 in excess of the Commission's SGP 61—1 price levels.7 On this score in 1956 the Commission authorized a large number of § 7 high price sales without providing for any conditions. This action was reversed in Atlantic Refining Co. v. Public Service Comm'n of New York, 360 U.S. 378, 79 S.Ct. 1246, 3 L.Ed.2d 1312 (1959), and like cases. Although § 5 proceedings have been filed on these cases there are substantial numbers of other such sales that have never been tested and are not now contested. Section 5 proceedings operate prospectively and so, of course, all of the sales are nonrefundable. The statistics indicate that of the 1960 revenue received by 13 major producers about $250,000,000 (roughly 83%) is not subject to refund.8 Furthermore, the Court says that the rates covered by the § 4(e) proceedings dismissed herein 'were 'locked in,' their validity for the future was not at issue; the sole question was whether all or any part of the increases had to be refunded by Phillips.' The fact is that the Commission has used this same 'stale' 1954 price year which it discarded, including its income level, in determining that refunds were not due for the subsequent four years and in dismissing those proceedings. Hence dismissal forecloses any recovery of excess rates for the periods covering those proceedings, i.e., the four-year period 1954—1958, which the Commission has found nonrefun dable. As I have shown, the 1954 rate as determined by the Commission has serious questions as to its legality. Certainly the subsequent years—based entirely on it—should not have been dismissed. While it may be true, as the Court says, that 'refund obligations * * * do not provide as much protection as the elimination of unreasonable rates' it must be remembered that here the § 5(a) case was also dismissed. Why this precipitous action? The proceedings had been on the books for six years! Why did not the Commission leave them pending until final determination of Phillips' responsibility on all of its more than 95 filings? The Commission makes no answer. There is none.
54
The dismissal of the § 5(a) proceeding was likewise unjustified. Continuation of the proceeding would have required a remand but the conclusion of the Court that 'several years might have elapsed' before a determination of the issue is a bad guess. It has been two years since this dismissal and there is nothing in sight as yet for a final decision on the Permian Basin area proceeding. The Commission has 22 more areas to go. Meanwhile all areas, including Phillips', have escaped regulation for the years 1954—1963, a total of nine years. If in 1960 the Commission had remanded the § 5(a) proceeding it could long since have been decided, since the enormous increase in Phillips' revenue for 1960 ($45.6 million in 1954 to $90.8 million in 1960) would have definitely shown an excessive rate. The Examiner had found, contrary to the conclusion of the Court, that the 1956 cost of service was not 'significantly higher' than 1954. All that would have been necessary was to project this to the three-year period 1957—1959, inclusive. Phillips, I wager, could have done this almost overnight, if it did not already have the figures available. The Commission in determining the standards to be used had allowed every cost item save the allocation on associated gas which could have been easily corrected on the percentages involved. The remainder of Phillips' system of accounting had received the approval of the Commission and would have readily revealed its costs.
55
The Court says that a new § 5(a) proceeding can be filed. This is true, but if it were filed tomorrow, more than nine years will already have been lost to the consumer!
56
The Commission, in my view, had no valid excuse for dismissing the § 4(e) and § 5(a) proceedings. It followed exactly the opposite course in Hunt Oil Co., 28 F.P.C. 623. The Court dismisses this case as inapposite but its technical distinction merits no discussion. As I see it the conclusion in Hunt not to dismiss the pending proceedings is in direct conflict with the action taken here.
57
I have considered this record page by page—line by line—and have given the Commission's action my most careful attention. There is but one conclusion—namely, that the Commission erred in its determination of the 1954 cost of service and return; and in dismissing the § 4(e) and § 5(a) proceedings, rather than concluding the case by determining a just and reasonable rate, it acted in an arbitrary and unreasonable manner entirely outside of the traditional concepts of administrative due process.
58
III. THE FALLACY OF THE STATEMENT OF GENERAL POLICY.
59
As the Court says, the validity of the Statement, SGP 61—1, and the rates accompanying it is not before the Court. But despite this declaration I notice that the Court proceeds to discuss the Statement and strongly implies a view as to its validity. I think it both premature and dangerous to pass any judgment at this stage of the proceedings. There are serious legal questions lurking in the application of the policy and we should not intimate its approval until a definitive case is presented under it. I deem it appropriate to raise these questions here not to join issue on the merits but only to outline the reasons for my reservations about the Court's consideration of this aspect of the case. While I do have serious doubts about both the wisdom and the legality of this approach to price determination, this is certainly not the case in which to give them full-dress treatment.
60
It is of course true that the cost-of-service method is not the 'sine qua non of natural gas rate regulation.' It is not so much that the Commission must follow a single method but rather that, in abandoning a historic, presently used and undoubtedly legal one in the summary manner done here, it left the production of gas without the required regulation which the Congress has directed. It can hardly be denied that the Commission's action will leave producers for a number of years—estimated by the Court of Appeals at up to 14—without effective regulation and will result in irreparable injury to the consumer of gas. The only brakes on spiraling producer prices are the 'guide prices' which the Commission attached to its SGP 61—1. These, rather than being legally established rates, are nonreviewable guides reflecting the highest certificated rate or weighted price. They have no binding effect. Indeed, they may well establish a floor rather than a ceiling.
61
In addition, area pricing must run the hurdle of legal attack and, to be constitutionally sound, must include a showing that the individual producer at the area rate fixed will recover his costs; otherwise it would be confiscatory and illegal. I cannot share the Court's optimistic view that the Commission's area rate, tested by 'the 'reasonable financial requirements of the industry' in each production area,' is likely to do this. The facts of gas industry life make it crystal clear that one producer's costs very immeasurably from another's and cannot be leveled off—at least until discovered. For example, Phillips' dry holes cost about $11,000,000, its surrendered leases $9,000,000 and its undeveloped offshore ones $17,000,000. Are these items to be included in the 'reasonable financial requirements' used to fix the rate of the area? If they are it will be unfair for the reason that other producers in the area may or may not have had such costs. Inevitably, the area average will be lower than the high cost producer. Hence the 'financial requirements of the industry' will not satisfy him. If the rate is set by the 'financial requirements' of the higher cost producer it will be higher than that necessary to make it just and reasonable to the lower cost producer, thus resulting in a windfall to the latter. If the 'financial requirements' of the lower cost producer are used it will result in a rate that will confiscate the gas of the higher cost producer. If the higher and lower costs are averaged, as the Commission indicates it intends to do, then the higher cost producer will still not recover his costs and the rate will be confiscatory. On the other hand the lower cost producer will receive a windfall. And so, as I see it, the area plan is in a squeeze—i.e., any criteria the Commission uses would not reflect individual just and reasonable rates. Moreover, it must be remembered that the burden of proving just and reasonable rates is on the producer and he cannot be precluded from offering relevant proof of his cost. This he will demand in the event his statistics show his costs above those fixed for his area. And so the cold truth is that, after all of its area pricing investigation and the fixing of a rate pursuant thereto, the producer aggrieved at that rate may demand and be entitled to a full hearing on his cost. The result is additional delay, delay and delay until the inevitable day when there is no more gas to regulate.
62
Typical of this simple fact of gas industry life is the announcement last November 15 that the Commission staff had recommended two prices for the gas of the Permian Basin (Phillips) area. It was below the 'guidelines' of the Commission's SGP 61—1 and, further, suggested that these prices be ceilings but not floors. Immediately there sprang up vigorous protest. Independent producers threatened to withdraw their support of the area pricing plan. A meeting was held in Washington with the Commission where it was insisted that 'realistic and uniform prices' be followed in each area consistent with the 'implied promise' of the original SGP 61—1 in this case. The producers were assured three months later that the 'staff's position is not necessarily that of the Commission.' See Tipro Reporter, Feb.-Mar. 1963. It does not require a crystal ball to see what will happen regardless of the conclusion of the Commission. If it decides to make the rates suggested a floor, the respective independent producers will require individual cost proceedings; if the rates are made both a floor and a ceiling, thousands of old rates will be raised to the floor and the consumer will pay the bill.
63
That the Commission's problems are difficult goes without saying. But as complicated as they appear to be it seems entirely feasible for it to solve them. Other agencies have been faced with like congestion problems. Indeed both the National Labor Relations Board and the Wage and Hour Administration found that they could not process all situations confronting them. They adopted procedures that exempted the inconsequential ones. See 23 N.L.R.B.Ann.Rep. 7—8 (1958). The suggestion that the Commission do likewise has much merit. It appears that in 1953, the year before Phillips, of all the producers then selling in interstate commerce, each of 4,191 producers sold less than 2,000,000,000 cubic feet of gas annually, the total of their sales being only 9.26% of the gas then sold in interstate commerce. See Landis, Report on Regulatory Agencies to the President-Elect(1960), 55. In the Commission's opinion in this case it stated that there were 3,372 producers selling interstate in 1960. The number has therefore decreased almost a thousand since the Phillips decision in 1954, which indicates that some of the smaller producers have escaped from their interstate commitments. However, if all of those who escaped were in the less than 2,000,000,000 cubic feet bracket there would still remain some 3,000 producers whose sales are miniscule. It therefore appears to me that inconsequential producers by the hundreds might well be temporarily exempted. The Commission could then concentrate on the large producers (20 of them control over 50% of the interstate gas) without the pressures incident to the smaller ones. The integrated producer of large volume is inevitably going to be the low cost producer. Hence his rate will be an effective floor from which the small producer rates might well be adjusted. This would give the consumer rate protection over the overwhelming amount of interstate gas more quickly9 and would give assurances to the small producer that he would be protected from confiscation.
64
IV. INCONSEQUENTIAL MATTERS.
65
There are two inconsequential matters that the Court discusses. The first is the escalation clause in several of Phillips' contracts. The Commission has promulgated a series of rule-making orders condemning spiral escalation clauses as being against the public interest. By Orders Nos. 232 and 232A, 25 F.P.C. 379 and 609, respectively, 26 Fed.Reg. 1983 and 2850, it announced that these clauses in contracts executed on or after April 3, 1961, would be without effect. And Order No. 242, 27 F.P.C. 339, 27 Fed.Reg. 1356, announced that contracts containing such clauses would be unacceptable for filing after April 2, 1962. The Commission argues that the contracts under attack here were all dated prior to 1954 and hence its order refusing to find them void should be upheld. This is, of course, a non sequitur. Nor is it understandable how the clauses become effective against the public interest and unacceptable in 1961 but the identical provisions are blessed with validity prior to that date. I cannot subscribe to such a doctrine. However, since the Court requires the producer to 'establish its lawfulness wholly apart from the (escalation) terms of the contract' I cannot become excited over it. Obviously the clauses have no effect whatsoever in determining the reasonableness of a rate from the public standpoint. They do have the effect of triggering the filing of increased rates. They should be completely outlawed by the Commission when the two § 4(e) proceedings left pending are decided.
66
The other miniscule point when compared to the basic questions in the case is whether Phillips' widely varying rates were 'on their face unduly discriminatory and preferential,' as contended by petitioners in No. 72. The Court refrains from passing on this issue, regarding it as not raised in the court below or on rehearing before the Commission. Section 19(b) of the Act precludes a court on review from considering an objection not raised in the petition for rehearing before the Commission, but it appears that petitioner Wisconsin adequately raised the issue of discrimination in its rehearing petition,10 and the Commission in denying rehearing stated that Phillips' rates 'normally vary greatly * * * and there is nothing to show that these rates are discriminatory or preferential.' 24 F.P.C., at 1009. I regret that the Court has chosen this occasion to stand on technicality, compare Federal Trade Comm'n v. Henry Broch & Co., 368 U.S. 360, 363, 82 S.Ct. 431, 433, 7 L.Ed.2d 353 (1962), when public interest stands the loss. The patently discriminatory nature of the rate increases, resulting in rates varying from 5.5 to 17.5¢ per Mcf. cannot seriously be questioned. The Examiner found that on the date of the Phillips decision its prices ranged from 1.2¢ to a high of 15.7¢ per Mcf. He concluded that to continue such a rate structure would preserve 'for Phillips an unduly discriminatory general rate structure, which would be contrary to the public itnerest * * *.' 24 F.P.C., at 790. The Commission staff also found that 'Phillips contract rates vary so widely, even as between contracts for the same service from the same producing areas, as to patently contravene the public interest, generating and perpetuating undue preference and undue discrimination.' Id., at 790—791. While the issue of discrimination was raised only generally in the Court of Appeals,11 it was implicit in the broad questions on which we granted certiorari. While the issue is minor as compared to the primary issues here, it certainly results in a miscarriage of justice for the Court, on such a highly technical ground, to permit the Commission's disposition to stand, to the irreparable injury of the consumers of gas
V.
67
As I reminded in the beginning, the Congress directed that gas moving in interstate commerce be sold at just and reasonable rates. The basis of such a determination must have some reference to the costs of the service. The Commission has, however, failed to require this. Instead it has declared the 1954 test year, which it thoroughly investigated, to be 'stale' but nevertheless used its findings for that year to release Phillips from regulation not only for 1954 but also for the four succeeding years. Pursuant thereto it dismissed the § 4(e) proceedings and a § 5(a) proceeding covering those periods. In addition the Commission has abandoned its cost-of-service program of rate fixing and has embarked on an area basis regulation which is highly questionable. It has also promulgated, without any hearing, rates as guidelines that have no support in evidence as to their justness and reasonableness. Through this course of conduct the Commission's program of producer regulation—of which Phillips is the keystone has permitted the continued collection of untested, unreasonable, unjust, discriminatory and preferential rates. This situation under the present timetable will continue for years. For these reasons I believe that the public interest requires that this case be reversed and remanded to the Commission with directions to fix the just and reasonable rates of Phillips involved herein. I therefore dissent.
1
Phillips is a large integrated oil company which is also a producer of natural gas. It is known as an 'independent' in that it does not engage in the interstate gas pipeline business and is not affiliated with any interstate gas pipeline company.
2
Section 5(a) of the Natural Gas Act, 52 Stat. 823, 15 U.S.C. § 717d(a), provides:
'Whenever the Commission, after a hearing had upon its own motion or upon complaint of any State, municipality, State commission, or gas distributing company, shall find that any rate, charge, or classification demanded, observed, charged, or collection by any natural-gas company in connection with any transportation or sale of natural gas, subject to the jurisdiction of the Commission, or that any rule, regulation, practice, or contract affecting such rate, charge, or classification is unjust, unreasonable, unduly discriminatory, or preferential, the Commission shall determine the just and reasonable rate, charge, classification, rule, regulation, practice, or contract to be thereafter observed and in force, and shall fix the same by order: Provided, however, That the Commission shall have no power to order any increase in any rate contained in the currently effective schedule of such natural gas company on file with the Commission, unless such increase is in accordance with a new schedule filed by such natural gas company; but the Commission may order a decrease where existing rates are unjust, unduly discriminatory, preferential, otherwise unlawful, or are not the lowest reasonable rates.'
3
Section 4(e) of the Natural Gas Act, 52 Stat. 823, as amended, 76 Stat. 72, 15 U.S.C. (Supp. IV) § 717c(e), provides:
'Whenever any such new schedule is filed the Commission shall have authority * * * to enter upon a hearing concerning the lawful
ness of such rate, charge, classification, or service; and, pending such hearing and the decision thereon, the Commission, upon filing with such schedules and delivering to the natural-gas company affected thereby a statement in writing of its reasons for such suspension, may suspend the operation of such schedule and defer the use of such rate, charge, classification, or service, but not for a longer period than five months beyond the time when it would otherwise go into effect, and after full hearings, either completed before or after the rate, charge, classification, or service goes into effect, the Commission may make such orders with reference thereto as would be proper in a proceeding initiated after it had become effective. If the proceeding has not been concluded and an order made at the expiration of the suspension period, on motion of the natural-gas company making the filing, the proposed change of rate, charge, classification, or service shall go into effect. Where increased rates or charges are thus made effective, the Commission may, by order, require the natural-gas company to furnish a bond, to be approved by the Commission, to refund any amounts ordered by the Commission, to keep accurate accounts in detail of all amounts received by reason of such increase, specifying by whom and in whose behalf such amounts were paid, and, upon completion of the hearing and decision, to order such natural-gas company to refund, with interest, the portion of such increased rates or charges by its decision found not justified. 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, and the Commission shall give to the hearing and decision of such questions preference over other questions pending before it and decide the same as speedily as possible.'
4
The exception involves an annual increase of $21,234, and we are advised by Phillips that this increase has since been superseded by a later filing, not suspended by the Commission.
5
An increased rate which is later superseded by a further increase is thus effective only for the limited intervening period, called the 'locked-in' period, and retains significance in § 4(e) proceedings only in respect of its refundability if found unlawful. See infra, pp. 304—305.
6
The phrase 'jurisdictional cost of service' as used here means the producer's system-wide cost of service (i.e., all operating expenses, including depreciation, depletion, and taxes, plus a fair return on the rate base) for its sales of natural gas subject to the Commission's jurisdiction. The 'test year 1954' means the calendar year 1954, with adjustments for certain changes in costs and increases in revenues through 1956. No challenge is here made by either side to any aspect of the Commission's determination of Phillips' jurisdictional cost of service for the test year.
7
The Statement of General Policy, as originally issued, appears at 25 Fed.Reg. 9578. It was issued without notice or hearing, and the Commission expressly stated that the price levels were 'for the purpose of guidance and initial action by the Commission and their use will not deprive any party of substantive rights or fix the ultimate justness and reasonableness of any rate level.'
8
On rehearing, the cost of service was redetermined to be $54,525,315, or 11.1009¢ per Mcf, subject to certain necessary adjustments for purchased gas costs, gathering taxes, and royalties. These adjustments would increase the average unit cost to about 12.16¢ per Mcf.
9
These clauses provided that when a specified commodity price index increased by more than a certain number of points, and a general increase in a Phillips pipeline customer's resale rates had gone into effect, then Phillips' rates to that customer could be proportionally increased.
10
See note 9, supra.
11
52 Stat. 831, as amended, 15 U.S.C. § 717r(b).
12
By Order Nos. 232, 26 Fed.Reg. 1983, and 232A, 26 Fed.Reg. 2850, the Commission announced that spiral escalation clauses contained in contracts executed on or after April 3, 1961, would be inoperative and without effect. By Order No. 242, 27 Fed.Reg. 1356, the Commission announced that contracts containing such clauses would be unacceptable for filing on or after April 2, 1962.
13
See note 5, supra.
14
Phillips' test year unit revenue requirements, on the basis of the Commission's determinations, were about 12.16¢ per Mcf. See note 8, supra. Data from Phillips' annual reports, filed with the Commission, show average jurisdictional revenues as follows: 8.9¢ (1955); 9.4¢ (1956); 9.9¢ (1957); 11.1¢ (1958); 12.3 (1959).
15
We find no necessary inconsistency between this determination and the Commission's recent decision in Hunt Oil Co., 28 F.P.C. 623, in which the Commission remanded § 4(e) proceedings for the taking of additional evidence and stated:
'Our examination of the record in this case convinces us that increased rates for specific sales cannot always be found to be just and reasonable solely on the basis of a comparison of individual company-wide costs with that company's revenues in a test year.' 28 F.P.C., at 626.
The record in the Hunt case is not before us, but it is evident from the Commission's opinion that, unlike the present case, certain increased rates there involved were not 'locked in' and were higher than the currently prevailing rates in the production area. Thus the factors that may have merited limited supplementation of the record in that case with respect to the § 4(e) proceedings were not present here. It should also be noted that in Hunt, as here, the Commission decided not to pursue the broad § 5(a) inquiry into the lawfulness of all of the producer's present rates. See p. 314, infra.
16
We do not interpret the decision of the Court of Appeals in Detroit v. Federal Power Comm'n, 97 U.S.App.D.C. 260, 230 F.2d 810, to suggest that, in the view of that court, individual company cost of service is the method required to be used in independent natural gas producer rate regulation. The court did express the view that, in considering the price which a pipeline could charge for gas produced from its own wells, cost of service must be used 'at least as a point of departure.' 97 U.S.App.D.C., at 268, 230 F.2d, at 818. Whatever the court may have meant in that context, it is clear that it did not have before it any questions relating to the area rate method, and it is interesting to note that Judge Fahy, the author of the Detroit opinion, said in his opinion below in this case: 'We should not seek to deter the Commission from pursuing such a method (the area method) in future proceedings, or from using it in any proceedings already initiated along those lines.' 112 U.S.App.D.C., at 379, 303 F.2d, at 390. See also Panhandle Eastern Pipe Line Co. v. Federal Power Comm'n, 113 U.S.App.D.C. 94, 305 F.2d 763.
17
See the discussion in the opinions of Mr. Justice Jackson in Federal Power Comm'n v. Hope Natural Gas Co., 320 U.S. 591, 628 660, 64 S.Ct. 281, 300—315, 88 L.Ed. 333, and in Colorado Interstate Gas Co. v. Federal Power Comm'n, 324 U.S. 581, 608—615, 65 S.Ct. 829, 841—845, 89 L.Ed. 1206.
18
The fact that this record may have been stale by the time the Commission rendered its decision certainly does not mean that no rate proceedings can be decided before the record becomes out of date. This pilot proceeding was one of unusual length and complexity, and the Commission noted that both costs and revenues 'increased greatly' between the test year and the year of decision. The Commission has presumably learned a great deal in this case which will be of use to it in the area proceedings, and there is no reason to suppose that those proceedings will be rendered incapable of decision by the march of time.
19
The area is South Louisiana, and the downward trend is due in part to settlement of certain rate cases and the ordering of substantial refunds.
20
In Hunt, the Commission said: 'It is our hope that area proceedings will result in a timely determination of Hunt's rates for the future. However, in order to assure adequate protection to consumers against any unreasonably high rates of Hunt which may not be subject to an early determination on an area basis we will hold in abeyance further action on the 5(a) aspects of the case pending area rate determinations, with the understanding that 5(a) proceedings on some or all of Hunt's rates may be subject to reactivation if future circumstances should so dictate.' 28 F.P.C., at 626.
1
For a discussion of the problems lurking under the decision see the separate dissents of Mr. Justice DOUGLAS and of the writer, 347 U.S., at 687, 690, respectively, 74 S.Ct., at 801, 802, 803, 98 L.Ed. 1035.
2
The 11.1009¢ figure for unit cost of service was announced in the Commission's order amending its opinion and denying rehearing. The figure was subject to redetermination for purchased gas costs, gathering taxes and royalties.
3
The Presiding Examiner found '(a)ny failure * * * to allow * * * rates sufficient to recoup * * * proper cost of service as here determined, would be inherently unfair and contrary to the public interest. It might also raise a serious question with respect to possible violation of the constitutional prohibition against confiscation.' 24 F.P.C., at 780.
4
Phillips sold 688,811,312 Mcf. of natural gas in 1954; it purchased 407,984,210 Mcf. and produced 375,690,912 Mcf. Its jurisdictional sales ran 71.9% of this total. (The difference between the total volume sold and the somewhat higher total volume produced and purchased results from company uses, losses, residue returned to leases, etc.)
5
The properties of Phillips known as the San Juan transfer were made in 1955 and involved a total 'known change' of some $8,000,000 which was not allowed. The assigned reason was that other properties were added but I find no support in the record for this conclusion.
6
In this connection, it appears strange that the Commission has exempted producers from the Uniform System of Accounts required of natural gas companies, 18 CFR, c. 1, part 201. No system has as yet been prescribed for producers. Moreover, the annual reports required from pipelines enable the Commission to promptly determine pipeline expense, returns, earnings, etc. This report for producers merely shows sales under each rate schedule. Finally, pipelines, when filing § 4 rate increases, must attach detailed cost justification. No such requirement is made of producers.
7
The situation is even more extreme in South Louisiana where 55% of the gas is now flowing at prices which exceed the Commission's 'initial price' ceiling; over 94% is flowing at prices exceeding the Commission's 'increased price'; and over 70% is flowing at prices which exceed the level the Commission found 'inline' for CATCO gas after our remand in Atlantic Refining Co. v. Public Service Comm'n of New York, 360 U.S. 378, 79 S.Ct. 1246, 3 L.Ed.2d 1312 (1959).
8
The Court seems to admit that the protection the Congress envisaged in § 4(e) is in practice illusory. First it comes too late; next, many of the consumers entitled to refunds cannot be found, etc. See Federal Power Comm'n v. Tennessee Gas Transmission Co., 371 U.S. 145, 154—155, 83 S.Ct. 211, 216—217, 9 L.Ed.2d 199 (1962). An even more realistic consideration is that these refunds have been permitted to reach the astronomical figure of $158,000,000 a year, of which amount Phillips has been receiving some $74,000,000. If the 'evil day' for the producer ever arrives where he must pay up, from where will the money come? It would bankrupt the average producer. The Commission would necessarily, in order to protect the service of interstate customers, be obliged to compromise or forgive them.
9
Four cases involving major producers have been decided by the Examiners and five investigations of other major producers have now been completed. These nine producers, with Phillips, handle 30% of all interstate gas. Still no major rate case has been decided since Phillips. Only two area cases are under investigation. These two areas—Permian and South Louisiana—furnish only 32% of all interstate gas. The South Louisiana case will take several years to complete.
10
Wisconsin's petition for rehearing, in point (1), challenged the Commission's policy statements regarding rate regulation, on the ground that 'the issue in this case is to determine whether the jurisdictional rates and charges or classifications demanded, observed, charged or collected by Phillips, or any rules, regulations, practices or contracts affecting them, are unjust, unreasonable, unduly discriminatory or preferential. Natural Gas Act §§ 4, 5.' (Emphasis added.)
11
See points 1 and 2, Brief of Long Island Lighting Co., petitioner in No. 74, on petition for review of the Commission's order in the Court of Appeals.
| 78
|
373 U.S. 341
83 S.Ct. 1246
10 L.Ed.2d 389
Harold J. SILVER, doing business as Municipal Securities Company, et al., Petitioners,v.NEW YORK STOCK EXCHANGE.
No. 150.
Argued Feb. 25 and 26, 1963.
Decided May 20, 1963.
[Syllabus from pages 341-342 intentionally omitted]
David I. Shapiro, Washington, D.C., for petitioners.
A. Donald MacKinnon, New York City, for respondent. Archibald Cox, Sol. Gen., for the United States, as amicus curiae, by special leave of Court.
Mr. Justice GOLDBERG delivered the opinion of the Court.
1
We deal here today with the question, of great importance to the public and the financial community, of whether and to what extent the federal antitrust laws apply to securities exchanges regulated by the Securities Exchange Act of 1934. More particularly, the question is whether the New York Stock Exchange is to be held liable to a nonmember broker-dealer under the antitrust laws or regarded as impliedly immune therefrom when, pursuant to rules the Exchange has adopted under the Securities Exchange Act of 1934, it orders a number of its members to remove private direct telephone wire connections previously in operation between their offices and those of the nonmember, without giving the nonmember notice, assigning him any reason for the action, or affording him an opportunity to be heard.
I.
2
The facts material to resolution of this question are not in dispute. Harold J. Silver, who died during the pendency of this action, entered the securities business in Dallas, Texas, in 1955, by establishing the predecessor of petitioner Municipal Securities (Municipal) to deal primarily in municipal bonds. The business of Municipal having increased steadily, Silver, in June 1958, established petitioner Municipal Securities, Inc. (Municipal, Inc.), to trade in corporate over-the-counter securities. Both firms are registered broker-dealers and members of the National Association of Securities Dealers, Inc. (NASD); neither is a member of the respondent Exchange.
3
Instantaneous communication with firms in the mainstream of the securities business is of great significance to a broker-dealer not a member of the Exchange, and Silver took steps to see that this was established for his firms. Municipal obtained direct private telephone wire connections with the municipal bond departments of a number of securities firms (three of which were members of the Exchange) and banks, and Municipal, Inc., arranged for private wires to the corporate securities trading departments of 10 member firms of the Exchange, as well as to the trading desks of a number of nonmember firms.
4
Pursuant to the requirements of the Exchange's rules, all but one of the member firms which had granted private wires to Municipal, Inc., applied to the Exchange for approval of the connections.1 During the summer of 1958 the Exchange granted 'temporary approval' for these, as well as for a direct teletype connection to a member firm in New York City and for stock ticker service to be furnished to petitioners directly from the floor of the Exchange.
5
On February 12, 1959, without prior notice to Silver, his firms, or anyone connected with them, the Exchange's Department of Member Firms decided to disapprove the private wire and related applications. Notice was sent to the member firms involved, instructing them to discontinue the wires, a directive with which compliance was required by the Exchange's Constitution and rules. These firms in turn notified Silver that the private wires would have to be discontinued, and the Exchange advised him directly of the discontinuance of the stock ticker service. The wires and ticker were all removed by the beginning of March. By telephone calls, letters, and a personal trip to New York, Silver sought an explanation from the Exchange of the reason for its decision, but was repeatedly told it was the policy of the Exchange not to disclose the reasons for such action.2
6
Petitioners contend that their volume of business dropped substantially thereafter and that their profits fell, due to a combination of forces all stemming from the removal of the private wires—their consequent inability to obtain quotations quickly, the inconvenience to other traders in calling petitioners, and the stigma attaching to the disapproval. As a result of this change in fortunes, petitioners contend, Municipal, Inc., soon ceased functioning as an operating business organization, and Municipal has remained in business only on a greatly diminished scale.
7
The present litigation was commenced by Silver as proprietor of Municipal and by Municipal, Inc., against the Exchange in April 1959, in the Southern District of New York.3 Three causes of action were asserted. The first, seeking an injunction and treble damages,4 alleged that the Exchange had, in violation of §§ 1 and 2 of the Sherman Act, conspired with its member firms to deprive petitioners of their private wire connections and stock ticker service. The second alleged that the Exchange had tortiously induced its member firms to breach their contracts for wire connections with petitioners, and the third asserted that the Exchange's action constituted a tort of intentional and wrongful harm inflicted without reasonable cause.
8
Petitioners moved for summary judgment on the antitrust claim, and for an accompanying permanent injunction against the Exchange's coercion of its members into refusing to provide private wire connections and against the Exchange's refusal to reinstate the stock ticker service. The district judge, after considering the respective affidavits of the parties, granted summary judgment and a permanent injunction as to the private wire connections, 196 F.Supp. 209, holding that the antitrust laws applied to the Exchange, and that its directive and the ensuing compliance by its members constituted a collective refusal to continue the wires and was a per se violation of § 1 of the Sherman Act. The judge so held on the basis that, although the Exchange had the power to regulate the conduct of its members in dealing with listed securities, its members' relations with nonmembers with regard to over-the-counter securities were not sufficiently germane to the fulfillment of its duties of self-regulation under the Securities Exchange Act to warrant its being excused from having to answer for restraints of trade such as occurred here by removal of the private wires. He left the issues of treble damages and costs to a later trial. With reference to the stock ticker service, the judge held that there were triable issues of fact as to whether the Exchange's action could be considered to have been the concerted action of its members and as to whether, if the Exchange was to be regarded as having acted by itself, any violation of § 2 of the Sherman Act had occurred. He therefore denied summary judgment as to that aspect of petitioners' claims.
9
On the Exchange's appeal from the grant of partial summary judgment the United States Court of Appeals for the Second Circuit reversed over the dissent of one judge. 302 F.2d 714. The court held that the Securities Exchange Act 'gives the Commission and the Exchange disciplinary powers over members of the Exchange with respect to their transactions in over-the-counter securities, and that the policy of the statute requires that the Exchange exercise these powers fully.' Id., at 720. This meant that 'the action of the Exchange in bringing about the cancellation of the private wire connections * * * was within the general scope of the authority of the Exchange as defined by the 1934 Act,' id., at 716, and dictated a conclusion that '(t)he Exchange is exempt from the restrictions of the Sherman Act because it is exercising a power which it is required to exercise by the Securities Exchange Act,' id., at 721. The court, however, did not exclude the possibility that the Exchange might be liable on some other theory, and remanded the case for consideration of petitioners' second and third causes of action.
10
This Court granted certiorari. 371 U.S. 808, 83 S.Ct. 26, 9 L.Ed.2d 53. What is before us is only so much of the first cause of action as relates to the collective refusal to continue the private wire connections, since petitioners did not attempt to appeal from the denial of summary judgment as to the portion relating to the discontinuance of the stock ticker service. Summary judgment was never sought as to the second and third causes of action, hence those are also not in issue at the present time.
II.
11
The fundamental issue confronting us is whether the Securities Exchange Act has created a duty of exchange self-regulation so pervasive as to constitute an implied repealer of our antitrust laws, thereby exempting the Exchange from liability in this and similar cases.
A.
12
It is plain, to begin with, that removal of the wires by collective action of the Exchange and its members would, had it occurred in a context free from other federal regulation, constitute a per se violation of § 1 of the Sherman Act. The concerted action of the Exchange and its members here was, in simple terms, a group boycott depriving petitioners of a valuable business service which they needed in order to compete effectively as broker-dealers in the over-the-counter securities market. Fashion Originators' Guild of America v. Federal Trade Comm., 312 U.S. 457, 61 S.Ct. 703, 85 L.Ed. 949; Associated Press v. United States, 326 U.S. 1, 65 S.Ct. 1416, 89 L.Ed. 2013; Klor's, Inc. v. Broadway-Hale Stores, Inc., 359 U.S. 207, 79 S.Ct. 705, 3 L.Ed.2d 741; Radiant Burners, Inc. v. Peoples Gas Light & Coke Co., 364 U.S. 656, 81 S.Ct. 365, 5 L.Ed.2d 358. Unlike listed securities, there is no central trading place for securities traded over the counter. The market is established by traders in the numerous firms all over the country through a process of constant communication to one another of the latest offers to buy and sell. The private wire connection, which allows communication to occur with a flip of a switch, is an essential part of this process. Without the instantaneously available market information provided by private wire connections, an over-the-counter dealer is hampered substantially in his crucial endeavor—to buy, whether it be for customers or on his own account, at the lowest quoted price and sell at the highest quoted price. Without membership in the network of simultaneous communication, the over-the-counter dealer loses a significant volume of trading with other members of the network which would come to him as a result of his easy accessibility. These important business advantages were taken away from petitioners by the group action of the Exchange and its members. Such 'concerted refusals by traders to deal with other traders * * * have long been held to be in the forbidden category,' Klor's, Inc. v. Broadway-Hale Stores, Inc., 359 U.S., at 212, 79 S.Ct., at 709 of restraints which 'because of their inherent nature or effect * * * injuriously restrained trade,' United States v. American Tobacco Co., 221 U.S. 106, 179, 31 S.Ct. 632, 55 L.Ed. 663.5 Hence, absent any justification derived from the policy of another statute or otherwise, the Exchange acted in violation of the Sherman Act. In this case, however, the presence of another statutory scheme, that of the Securities Exchange Act of 1934, means that such a conclusion is only the beginning, not the end, of inquiry.
B.
13
The difficult problem here arises from the need to reconcile pursuit of theantitrust aim of eliminating restraints on competition with the effective operation of a public policy contemplating that securities exchanges will engage in self-regulation which may well have anti-competitive effects in general and in specific applications.
14
The need for statutory regulation of securities exchanges and the nature of the duty of self-regulation imposed by the Securities Exchange Act are properly understood in the context of a consideration of both the economic role played by exchanges and the historical setting of the Act. Stock exchanges perform an important function in the economic life of this country. They serve, first of all, as an indispensable mechanism through which corporate securities can be bought and sold. To corporate enterprise such a market mechanism is a fundamental element in facilitating the successful marshaling of large aggregations of funds that would otherwise be extremely difficult of access. To the public the exchanges are an investment channel which promises ready convertibility of stock holdings into cash. The importance of these functions in dollar terms is vast—in 1962 the New York Stock Exchange, by far the largest of the 14 exchanges which are registered with the Securities and Exchange Commission, had $47.4 billion of transactions in stocks, rights, and warrants (a figure which represented 86% of the total dollar volume on registered exchanges). Report of the Special Study of Securities Markets (1963), c. IB, p. 6.6 Moreover, because trading on the exchanges, in addition to establishing the price level of listed securities, affects securities prices in general, and because such transactions are often regarded as an indicator of our national economic health, the significance of the exchanges in our economy cannot be measured only in terms of the dollar volume of trading. Recognition of the importance of the exchanges' role led the House Committee on Interstate and Foreign Commerce to declare in its report preceding the enactment of the Securities Exchange Act of 1934 that 'The great exchanges of this country upon which millions of dollars of securities are sold are affected with a public interest in the same degree as any other great utility.' H.R.Rep. No. 1383, 73d Cong., 2d Sess. 15 (1934).
15
The exchanges are by their nature bodies with a limited number of members, each of which plays a certain role in the carrying out of an exchange's activities. The limited-entry feature of exchanges led historically to their being treated by the courts as private clubs, Belton v. Hatch, 109 N.Y. 593, 17 N.E. 225 (1888), and to their being given great latitude by the courts in disciplining errant members, see Westwood and Howard, Self-Government in the Securities Business, 17 Law and Contemp. Prob. 518—525 (1952). As exchanges became a more and more important element in our Nation's economic and financial system, however, the private-club analogy became increasingly inapposite and the ungoverned self-regulation became more and more obviously inadequate, with acceleratingly grave consequences. This impotency ultimately led to the enactment of the 1934 Act. The House Committee Report summed up the long-developing problem in discussing the general purposes of the bill:
16
'The fundamental fact behind the necessity for this bill is that the leaders of private business, whether because of inertia, pressure of vested interests, lack of organization, or otherwise, have not since the war been able to act to protect themselves by compelling a continuous and orderly program of change in methods and standards of doing business to match the degree to which the economic system has itself been constantly changing * * *. The repetition in the summer of 1933 of the blindness and abuses of 1929 has convinced a patient public that enlightened self-interest in private leadership is not sufficiently powerful to effect the necessary changes alone—that private leadership seeking to make changes must be given Government help and protection.' H.R.Rep. No. 1383, supra, at 3.
17
It was, therefore, the combination of the enormous growth in the power and impact of exchanges in our economy, and their inability and unwillingness to curb abuses which had increasingly grave implications because of this growth, that moved Congress to enact the Securities Exchange Act of 1934. S.Rep. No. 792, 73d Cong., 2d Sess. 2—5 (1934); H.R.Rep. No. 1383, supra, at 2—5.
18
The pattern of governmental entry, however, was by no means one of total displacement of the exchanges' traditional process of self-regulation. The intention was rather, as Mr. Justice Douglas said, while Chairman of the S.E.C., one of 'letting the exchanges take the leadership with Government playing a residual role. Government would keep the shotgun, so to speak, behind the door, loaded, well oiled, cleaned, ready for use but with the hope it would never have to be used.' Douglas, Democracy and Finance (Allen ed. 1940), 82. Thus the Senate Committee Report stressed that 'the initiative and responsibility for promulgating regulations pertaining to the administration of their ordinary affairs remain with the exchanges themselves. It is only where they fail adequately to provide protection to investors that the Commission is authorized to step in and compel them to do so.' S.Rep. No. 792, supra, at 13. The House Committee Report added the hope that the bill would give the exchanges sufficient power to reform themselves without intervention by the Commission. H.R.Rep. No. 1383, supra, at 15. See also 2 Loss, Securities Regulation (2d ed. 1961), 1175—1178, 1180—1182.
19
Thus arose the federally mandated duty of self-policing by exchanges. Instead of giving the Commission the power to curb specific instances of abuse, the Act placed in the exchanges a duty to register with the Commission, § 5, 15 U.S.C. § 78e, and decreed that registration could not be granted unless the exchange submitted copies of its rules, § 6(a)(3), 15 U.S.C. § 78f(a)(3), and unless such rules were 'just and adequate to insure fair dealing and to protect investors,' § 6(d), 15 U.S.C. § 78f(d). The general dimensions of the duty of self-regulation are suggested by § 19(b) of the Act, 15 U.S.C. § 78s(b), which gives the Commission power to order changes in exchange rules respecting a number of subjects, which are set forth in the margin.7
20
One aspect of the statutorily imposed duty of self-regulation is the obligation to formulate rules governing the conduct of exchange members. The Act specifically requires that registration cannot be granted 'unless the rules of the exchange include provision for the expulsion, suspension, or disciplining of a member for conduct or proceeding inconsistent with just and equitable principles of trade * * *,' § 6(b), 15 U.S.C. § 78f(b). In addition, the general requirement of § 6(d) that an exchange's rules be 'just and adequate to insure fair dealing and to protect investors' has obvious relevance to the area of rules regulating the conduct of an exchange's members.
21
The § 6(b) and § 6(d) duties taken together have the broadest implications in relation to the present problem, for members inevitably trade on the over-the-counter market in addition to dealing in listed securities,8 and such trading inexorably brings contact and dealings with nonmember firms which deal in or specialize in over-the-counter securities. It is no accident that the Exchange's Constitution and rules are permeated with instances of regulation of members' relationships with nonmembers including nonmember broker-dealers.9 A member's purchase of unlisted securities for itself or on behalf of its customer from a boiler-shop operation10 creates an obvious danger of loss to the principal in the transaction, and sale of securities to a nonmember insufficiently capitalized to protect customers' rights creates similar risks. In addition to the potential financial injury to the investing public and Exchange members that is inherent in these transactions as well as in dealings with nonmembers who are unreliable for any other reason, all such intercourse carries with it the gravest danger of engendering in the public a loss of confidence in the Exchange and its members, a kind of damage which can significantly impair fulfillment of the Exchange's function in our economy. Rules which regulate Exchange members' doing of business with nonmembers in the over-the-counter market are therefore very much pertinent to the aims of self-regulation under the 1934 Act. Transactions with nonmembers under the circumstances mentioned can only be described as 'inconsistent with just and equitable principles of trade,' and rules regulating such dealing are indeed 'just and adequate to insure fair dealing and to protect investors.'
22
The Exchange's constitutional provision and rules relating to private wire connections11 are unquestionably part of this fulfillment of the § 6(b) and § 6(d) duties, for such wires between members and nonmembers facilitate trading in and exchange of information about unlisted securities, and such contact with an unreliable nonmember not only may further his business undesirably, but may injure the member or the member's customer on whose behalf the contract is made and ultimately imperil the future status of the Exchange by sapping public confidence. In light of the important role of exchanges in our economy and the 1934 Act's design of giving the exchanges a major part in curbing abuses by obligating them to regulate themselves, it appears conclusively—contrary to the District Court's conclusion—that the rules applied in the present case are germane to performance of the duty, implied by § 6(b) and § 6(d), to have rules governing members' transactions and relationships with nonmembers. The Exchange's enforcement of such rules inevitably affects the nonmember involved, often (as here) far more seriously than it affects the members in question. The sweeping of the nonmembers into the currents of the Exchange's process of self-regulation is therefore unavoidable; the case cannot be disposed of by holding as the district judge did that the substantive act of regulation engaged in here was outside the boundaries of the public policy established by the Securities Exchange Act of 1934.
C.
23
But, it does not follow that the case can be disposed of, as the Court of Appeals did, by holding that since the Exchange has a general power to adopt rules governing its members' relations with nonmembers, particular applications of such rules are therefore outside the purview of the antitrust laws. Contrary to the conclusions reached by the courts below, the proper approach to this case, in our view, is an analysis which reconciles the operation of both statutory schemes with one another rather than holding one completely ousted.
24
The Securities Exchange Act contains no express exemption from the antitrust laws or, for that matter, from any other statute. This means that any repealer of the antitrust laws must be discerned as a matter of implication, and '(i)t is a cardinal principle of construction that repeals by implication are not favored.' United States v. Borden Co., 308 U.S. 188, 198, 60 S.Ct. 182, 188, 84 L.Ed. 181; see Georgia v. Pennsylvania R. Co., 324 U.S. 439, 456—457, 65 S.Ct. 716, 725—726, 89 L.Ed. 1051; California v. Federal Power Comm., 369 U.S. 482, 485, 82 S.Ct. 901, 903, 8 L.Ed.2d 54. Repeal is to be regarded as implied only if necessary to make the Securities Exchange Act work, and even then only to the minimum extent necessary. This is the guiding principle to reconciliation of the two statutory schemes.
25
Although the Act gives to the Securities and Exchange Commission the power to request exchanges to make changes in their rules, § 19(b), 15 U.S.C. § 78s(b), and impliedly, therefore, to disapprove any rules adopted by an exchange, see also § 6(a)(4), 15 U.S.C. § 78f(a)(4), it does not give the Commission jurisdiction to review particular instances of enforcement of exchange rules. See 2 Loss, op. cit., supra, at 1178; Westwood and Howard, supra, 17 Law & Contemp. Prob., at 525. This aspect of the statute, for one thing, obviates any need to consider whether petitioners were required to resort to the Commission for relief before coming into court. Compare Georgia v. Pennsylvania R. Co., 324 U.S., at 455, 65 S.Ct. at 725. Moreover, the Commission's lack of jurisdiction over particular applications of exchange rules means that the question of antitrust exemption does not involve any problem of conflict or coextensiveness of coverage with the agency's regulatory power. See Georgia v. Pennsylvania R. Co., supra; United States v. Radio Corp. of America, 358 U.S. 334, 79 S.Ct. 457, 3 L.Ed.2d 354; California v. Federal Power Comm., supra; Pan American World Airways, Inc. v. United States, 371 U.S. 296, 83 S.Ct. 476, 9 L.Ed.2d 325.12 The issue is only that of the extent to which the character and objectives of the duty of exchange self-regulation contemplated by the Securities Exchange Act are incompatible with the maintenance of an antitrust action. Compare Maryland & Virginia Milk Producers Ass'n v. United States, 362 U.S. 458, 80 S.Ct. 847, 4 L.Ed.2d 880.
26
The absence of Commission jurisdiction, besides defining the limits of the inquiry, contributes to its solution. There is nothing built into the regulatory scheme which performs the antitrust function of insuring that an exchange will not in some cases apply its rules so as to do injury to competition which cannot be justified as furthering legitimate self-regulative ends. By providing no agency check on exchange behavior in particular cases, Congress left the regulatory scheme subject to 'the influences of * * * (improper collective action) over which the Commission has no authority but which if proven to exist can only hinder the Commission in the tasks with which it is confronted,' Georgia v. Pennsylvania R. Co., 324 U.S., at 460, 65 S.Ct. at 727; See United States v. Borden Co., 308 U.S., at 200, 60 S.Ct. at 189; Maryland & Virginia Milk Producers Ass'n v. United States, 362 U.S., at 465 466, 80 S.Ct. at 852—853. Enforcement of exchange rules, particularly those of the New York Stock Exchange with its immense economic power, may well, in given cases, result in competitive injury to an issuer, a nonmember broker-dealer, or another when the imposition of such injury is not within the scope of the great purposes of the Securities Exchange Act. Such unjustified self-regulatory activity can only diminish public respect for and confidence in the integrity and efficacy of the exchange mechanism. Some form of review of exchange self-policing, whether by administrative agency or by the courts, is therefore not at all incompatible with the fulfillment of the aims of the Securities Exchange Act. Only this year S. E. C. Chairman Cary observed that 'some government oversight is warranted, indeed necessary, to insure that action in the name of self-regulation is neither discriminatory nor capricious.' Cary, Self-Regulation in the Securities Industry, 49 A.B.A.J. 244, 246 (1963).13 Since the antitrust laws serve, among other things, to protect competitive freedom, i.e., the freedom of individual business units to compete unhindered by the group action of others, it follows that the antitrust laws are peculiarly appropriate as a check upon anticompetitive acts of exchanges which conflict with their duty to keep their operations and those of their members honest and viable. Applicability of the antitrust laws, therefore, rests on the need for vindication of their positive aim of insuring competitive freedom. Denial of their applicability would defeat the congressional policy reflected in the antitrust laws without serving the policy of the Securities Exchange Act. Should review of exchange self-regulation be provided through a vehicle other than the antitrust laws, a different case as to antitrust exemption would be presented. See note 12, supra.
27
Yet it is only frank to acknowledge that the absence of power in the Commission to review particular exchange exercises of self-regulation does create problems for the Exchange. The entire public policy of self-regulation, beginning with the idea that the Exchange may set up barriers to membership, contemplates that the Exchange will engage in restraints of trade which might well be unreasonable absent sanction by the Securities Exchange Act. Without the oversight of the Commission to elaborate from time to time on the propriety of various acts of self-regulation, the Exchange is left without guidance and without warning as to what regulative action would be viewed as excessive by an antitrust court possessing power to proceed based upon the considerations enumerated in the preceding paragraphs. But, under the aegis of the rule of reason, traditional antitrust concepts are flexible enough to permit the Exchange sufficient breathing space within which to carry out the mandate of the Securities Exchange Act. See United States v. Terminal R. Ass'n of St. Louis, 224 U.S. 383, 394 395, 32 S.Ct. 507, 509—510, 56 L.Ed. 810; Board of Trade of City of Chicago v. United States, 246 U.S. 231, 238, 38 S.Ct. 242, 243, 62 L.Ed. 683. Although, as we have seen, the statutory scheme of that Act is not sufficiently pervasive to create a total exemption from the antitrust laws, compare Hale and Hale, Competition or Control VI: Application of Antitrust Laws to Regulated Industries, 111 U. of Pa.L.Rev. 46, 48, 57—59 (1962), it is also true that particular instances of exchange self-regulation which fall within the scope and purposes of the Securities Exchange Act may be regarded as justified in answer to the assertion of an antitrust Claim.
III.
28
The final question here is, therefore, whether the act of self-regulation in this case was so justified. The answer to that question is that it was not, because the collective refusal to continue the private wires occurred under totally unjustifiable circumstances. Notwithstanding their prompt and repeated requests, petitioners were not informed of the charges underlying the decision to invoke the Exchange rules and were not afforded an appropriate opportunity to explain or refute the charges against them.
29
Given the principle that exchange self-regulation is to be regarded as justified in response to antitrust charges only to the extent necessary to protect the achievement of the aims of the Securities Exchange Act, it is clear that no justification can be offered for self-regulation conducted without provision for some method of telling a protesting non-member why a rule is being invoked so as to harm him and allowing him to reply in explanation of his position. No policy reflected in the Securities Exchange Act is, to begin with, served by denial of notice and an opportunity for hearing. Indeed, the aims of the statutory scheme of self-policing—to protect investors and promote fair dealing—are defeated when an exchange exercises its tremendous economic power without explaining its basis for acting, for the absence of an obligation to give some form of notice and, if timely requested, a hearing creates a great danger of perpetration of injury that will damage public confidence in the exchanges. The requirement of such a hearing will, by contrast, help in effectuating antitrust policies by discouraging anticompetitive applications of exchange rules which are not justifiable as within the scope of the purposes of the Securities Exchange Act. In addition to the general impetus to refrain from making unsupportable accusations that is present when it is required that the basis of charges be laid bare, the explanation or rebuttal offered by the nonmember will in many instances dissipate the force of the ex parte information upon which an exchange proposes to act. The duty to explain and afford an opportunity to answer will, therefore, be of extremely beneficial effect in keeping exchange action from straying into areas wholly foreign to the purposes of the Securities Exchange Act. And, given the possibility of antitrust liability for anti-competitive acts of self-regulation which fall too far outside the scope of the Exchange Act, the utilization of a notice and hearing procedure with its inherent check upon unauthorized exchange action will diminish rather than enlarge the likelihood that such liability will be incurred and hence will not interfere with the Exchange's ability to engage efficaciously in legitimate substantive self-regulation.14 Provision of such a hearing will, moreover, contribute to the effective functioning of the antitrust court, which would be severely impeded in providing the review of exchange action which we deem essential if the exchange could obscure rather than illuminate the circumstances under which it has acted. Hence the affording of procedural safeguards not only will substantively encourage the lessening of anticompetitive behavior outlawed by the Sherman Act but will allow the antitrust court to perform its function effectively.15
30
Our decision today recognizes that the action here taken by the Exchange would clearly be in violation of the Sherman Act unless justified by reference to the purposes of the Securities Exchange Act, and holds that that statute affords no justification for anti-competitive collective action taken without according fair procedures.16 Congress in effecting a scheme of self-regulation designed to insure fair dealing cannot be thought to have sanctioned and protected self-regulative activity when carried out in a fundamentally unfair manner.17 The point is not that the antitrust laws impose the requirement of notice and a hearing here, but rather that, in acting without according petitioners these safeguards in response to their request, the Exchange has plainly exceeded the scope of its authority under the Securities Exchange Act to engage in self-regulation and therefore has not even reached that threshold of justification under that statute for what would otherwise be an antitrust violation. Since it is perfectly clear that the Exchange can offer no justification under the Securities Exchange Act for its collective action in denying petitioners the private wire connections without notice and an opportunity for hearing, and that the Exchange has therefore violated § 1 of the Sherman Act, 15 U.S.C. § 1, and is thus liable to petitioners under §§ 4 and 16 of the Clayton Act, 15 U.S.C. §§ 15, 26, there is no occasion for us to pass upon the sufficiency of the reasons which the Exchange later assigned for its action.18 Thus there is also no need for us to define further whether the interposing of a substantive justification in an antitrust suit brought to challenge a particular enforcement of the rules on its merits is to be governed by a standard of arbitrariness, good faith, reasonableness, or some other measure. It will be time enough to deal with that problem if and when the occasion arises. Experience teaches, however, that the affording of procedural safeguards, which by their nature serve to illuminate the underlying facts, in itself often operates to prevent erroneous decisions on the merits from occurring. There is no reason to believe that the experience of the Exchange will be different from that of other institutions, both public and private. The benefits which a guarantee of procedural safeguards brings about are, moreover, of particular importance here. It requires but little appreciation of the extent of the Exchange's economic power and of what happened in this country during the 1920's and 1930's to realize how essential it is that the highest ethical standards prevail as to every aspect of the Exchange's activities. What is basically at issue here is whether the type of partnership between government and private enterprise that marks the design of the Securities Exchange Act of 1934 can operate effectively to insure the maintenance of such standards in the long run. We have today provided not a brake upon the private partner executing the public policy of self-regulation but a balance wheel to insure that it can perform this necessary activity in a setting compatible with the objectives of both the antitrust laws and the Securities Exchange Act.
31
The judgment is reversed and remanded for further proceedings consistent with this opinion.
32
It is so ordered.
33
Judgment reversed and the case is remanded with directions.
34
Mr. Justice CLARK concurs in the result on the grounds stated in the opinion of the District Court, 196 F.Supp. 209, and the dissenting opinion in the Court of Appeals, 302 F.2d 714.
35
Mr. Justice STEWART, whom Mr. Justice HARLAN joins, dissenting.
36
The Court says that the fundamental question in this case is 'whether and to what extent the federal antitrust laws apply to securities exchanges regulated by the Securities Exchange Act of 1934.' I agree that this is the issue presented, but with all respect it seems to me that the answer which the Court has given is both unsatisfactory and incomplete.
37
The Court begins by pointing out, correctly, that removal of the petitioners' wire connections by collective action of the Exchange and its members would constitute a violation of the Sherman Act, had it occurred in an ordinary commercial context.1 The Court then reviews at length the purpose, scope, and structure of the Securities Exchange Act and holds, again correctly I think, that the substantive act of regulation engaged in here was inside 'the boundaries of the public policy' established by the Exchange Act. The Court next reminds us, correctly, that the Exchange Act contains no express exemption from the antitrust laws, and that a stock exchange or its members might in some cases 'apply its rules so as to do injury to competition which cannot be justified as furthering legitimate self-regulative ends.'
38
So far, so good. The Court has fairly and thoroughly stated the competing considerations bearing upon the basic problem involved in this case. But then—in the last five pages of the Court's opinion—the nature of the problem seems suddenly to change. The case becomes one involving due process concepts of notice, confrontation, and hearing.
39
It may be that a hearing should be accorded a member or nonmember of an exchange, injured by the invocation of an exchange rule, in all cases. On the other hand, in view of the sophisticated, subtle, and highly technical nature of the problem of what are 'just and equitable principles of trade,' or because of the fragile and mercurial ingredients of public confidence in the securities markets, there might be cases in which the public interest would demand that at least preliminary disciplinary action be taken with swift effectiveness. These broad policy questions were, quite properly, neither briefed nor argued in the present case. They are questions well within the power of Congress and of the Securities and Exchange Commission to canvass and to resolve.2 But they are questions, I respectfully submit, which have only the most tangential bearing upon the issues now before us.
40
The Court says that because of the failure to accord 'procedural safeguards' to the petitioners, the respondent Exchange is ipso facto liable to them under the antitrust laws. This means that a bucket-shop operator who had been engaged in swindling the public could collect treble damages from a stock exchange which had denied him its wire connections without first according him notice and a hearing. For, as I understand the Court's opinion, the exchange would not be allowed to prove in this hypothetical antitrust case that the plaintiff was such a swindler, even though proof of that fact to an absolute certainty were available. This result seems to me completely to frustrate the purpose and policy of the Securities Exchange Act, and to bear no relevance to the purpose and policy of the antitrust laws. Even assuming that Congress agreed with the Court's notions of the appropriate procedures under the Exchange Act, I cannot believe that Congress would have provided an antitrust forum and private treble damage liability to enforce them.
41
Whether there has been a violation of the antitrust laws depends not at all upon whether or not the defendants' conduct was arbitrary. As this Court has said, 'the reasonableness of the methods pursued by the combination to accomplish its unlawful object is no more material than would be the reasonableness of the prices fixed by unlawful combination.' Fashion Originators' Guild of America v. Federal Trade Comm., 312 U.S. 457, 468, 61 S.Ct. 703, 708, 85 L.Ed. 949.3 Yet the Court today says that because the Exchange did not accord the petitioners what the Court considers 'fair procedures' under the Exchange Act, the Exchange has therefore violated § 1 of the Sherman Act.
42
I think the Court errs in using the antitrust laws to serve ends they were never intended to serve—to enforce the Court's concept of fair procedures under a totally unrelated statute. I should have thought that the aftermath of Duplex Printing Press Co. v. Deering4 would have provided a sufficient lesson as to the unwisdom of such a broad and basically irrelevant use of the antitrust laws.
43
The purpose of the self-regulation provisions of the Securities Exchange Act was to delegate governmental power to working institution which would undertake, at their own initiative, to enforce compliance with ethical as well as legal standards in a complex and changing industry. This self-initiating process of regulation can work effectively only if the process itself is allowed to operate free from a constant threat of antitrust penalties. To achieve this end, I believe it must be held that the Securities Exchange Act removes antitrust liability for any action taken in good faith to effectuate an exchange's statutory duty of self-regulation. The inquiry in each case should be whether the conduct complained of was for this purpose. If it was, that should be the end of the matter so far as the antitrust laws are concerned—unless, of course, some antitrust violation other than the mere concerted action of an exchange and its members is alleged.5
44
I would vacate the judgment of the Court of Appeals and remand the case to the District Court for further proceedings consistent with the views expressed in this dissenting opinion.
1
Exchange approval was never sought for Municipal's private wires to the municipal bond departments of member firms.
2
Ultimately, during the pretrial stages of this litigation, the Exchange disclosed most of the reasons for its action, and these are summarized and discussed in the opinions of both the District Court, 196 F.Supp. 209, 216—217, 225—227, and the Court of Appeals, 302 F.2d 714, 716. In view, however, of the disposition we make of the case hereafter, there is no need to set forth these reasons in detail in this opinion.
3
Silver died while the case was pending in the Court of Appeals, and his widow, Evelyn B. Silver, as executrix of his estate, was substituted for him.
4
These forms of relief are provided by §§ 4 and 16 of the Clayton Act, 15 U.S.C. §§ 15, 26.
5
The fact that the consensus underlying the collective action was arrived at when the members bound themselves to comply with Exchange directives upon being admitted to membership rather than when the specific issue of Silver's qualifications arose does not diminish the collective nature of the action. A blanket subscription to possible future restraints does not excuse the restraints when they occur. Associated Press v. United States, 326 U.S. 1, 65 S.Ct. 1416, 89 L.Ed. 2013. Nor does any excuse derive from the fact that the collective refusal to deal was only with reference to the private wires, the member firms remaining willing to deal with petitioners for the purchase and sale of securities. See Bigelow v. RKO Radio Pictures, Inc., 327 U.S. 251, 66 S.Ct. 574, 90 L.Ed. 652; United States v. Paramount Pictures, Inc., 334 U.S. 131, 167, 68 S.Ct. 915, 934, 92 L.Ed. 1260. A valuable service germane to petitioners' business and important to their effective competition with others was withheld from them by collective action. That is enough to create a violation of the Sherman Act. United States v. Terminal R. Ass'n of St. Louis, 224 U.S. 383, 32 S.Ct. 507, 56 L.Ed. 810; United States v. First National Pictures, Inc., 282 U.S. 44, 51 S.Ct. 45, 75 L.Ed. 151; Associated Press v. United States, supra; cf. Anderson v. United States, 171 U.S. 604, 618—619, 19 S.Ct. 50, 55, 43 L.Ed. 300.
6
The report cited in the text is the recently issued first segment of a study which the Commission was directed to make by a 1961 amendment to the Securities Exchange Act, § 19(d), 15 U.S.C. (Supp. III) § 78s(d). Another set of figures reported by the Special Study illustrates the great importance of corporate securities as a form of private property. As of the end of 1961, individuals had net financial savings of about $900,000,000,000, of which direct holdings of corporate securities amounted to more than half. In addition, life insurance companies and private pension funds held about $93,000,000,000 in corporate securities, and personal trust funds held another $57,000,000,000. Special Study, c. IB, pp. 2—3.
7
'The Commission is * * * authorized * * * to alter or supplement the rules of * * * (an) exchange * * * in respect of such matters as (1) safeguards in respect of the financial responsibility of members and adequate provision against the evasion of financial responsibility through the use of corporate forms or special partnerships; (2) the limitation or prohibition of the registration or trading in any security within a specified period after the issuance or primary distribution thereof; (3) the listing or striking from listing of any security; (4) hours of trading; (5) the manner, method, and place of soliciting business; (6) fictitious or numbered accounts; (7) the time and method of making settlements, payments, and deliveries and of closing accounts; (5) the reporting of transactions on the exchange and upon tickers maintained by or with the consent of the exchange, including the method of reporting short sales, stopped sales, sales of securities of issuers in default, bankruptcy or receivership, and sales involving other special circumstances; (9) the fixing of reasonable rates of commission, interest, listing, and other charges; (10) minimum units of trading; (11) odd-lot purchases and sales; (12) minimum deposits on margin accounts; and (13) similar matters.'
8
Member firms of the New York Stock Exchange accounted for over half of the total dollar volume of over-the-counter business in fiscal 1961, Special Study, op. cit., supra, c. IB, pp. 17—18, and trading in over-the-counter stocks constituted 21.6% of the estimated gross income of member firms of the Exchange for the same period, id., c. I, Table I—12.
9
Of most significance in this connection is Art. XIV, § 17, of the Exchange's Constitution, which permits it to order a member to sever any business connection which might cause the interest or good repute of the Exchange to suffer, and Rules 331—335, which provide various specific regulations governing members' relations with nonmember corporations and associations (including broker-dealers) in which they have an ownership interest or with which they are otherwise connected. Equally important are Rule 403, prohibiting transaction of business with a bucket shop, and Rule 435, prohibiting participation in any manipulative operation. The subject of commissions to be collected from nonmembers is regulated by Article XV of the Constitution and by numerous rules. Arbitration involving nonmembers is dealt with by Art. VIII, §§ 1 and 6, of the Constitution. Various other rules prohibit the joint use of an office with a nonmember unless the Exchange approves (Rule 344), the giving of compensation or gratuities to the employees of nonmembers without their employer's consent (Rule 350), and the paying of certain expenses of nonmembers (Rule 369). Rule 418 permits the Exchange to engage in a 'surprise' audit of any member who does business with nonmembers. And Art. III, § 6, of the Constitution and Rules 355 through 358 deal with private wire connections and related installations, see note 11, infra.
10
In deposition, the assistant director of the Exchange's Department of Member Firms described a boiler shop as 'usually a physically small operation which employs high pressure telephone salesmanship to oversell to the public by quantity, and in many cases by quality.' He said that this kind of firm, as well as bucket shops, inadequately capitalized firms, and firms which might misrepresent or withhold material facts from customers, was among those which the Exchange seeks to prevent from having the use of its facilities.
11
Article III, § 6, of the Constitution, which is entitled 'Supervision Over Members, Allied Members, Member Firms and Member Corporations,' provides, among other things, that the Exchange 'shall have power to approve or disapprove any application for ticker service to any non-member, or for wire, wireless, or other connection between any office of any member of the Exchange, member firm or member corporation and any non-member, and may require the discontinuance of any such service or connection.' Rule 355 provides, '(a) No member or member organization shall establish or maintain any wire connection, private radio, television or wireless system between his or its offices and the office of any non-member, or permit any private radio or television system between his or its offices, without prior consent of the Exchange. (b) Every non-member will be required to execute a private wire contract in form prescribed by the Exchange to be filed with it, unless a contract is already on file with the Exchange. (c) Notification regarding a private means of communication with a non-member and the signed contract when necessary shall be submitted to the Department of Member Firms. This notification, by a member or allied member, may be in form supplied by the Exchange or in letter form, and shall include the essential facts concerning the non-member and the means of communication. (d) Each member or member organization shall submit annually to the Department of Member Firms a list of all non-members with whom private means of communication are maintained. (e) The Exchange may require at any time that any means of communication be discontinued.' Rule 356, insofar as relevant, provides, 'The Exchange may require at any time the discontinuance of any means of communication whatsoever which has a terminus in the office of a member or member organization.'
12
Were there Commission jurisdiction and ensuing judicial review for scrutiny of a particular exchange ruling, as there is under the 1938 Maloney Act amendments to the Exchange Act to examine disciplinary action by a registered securities association (i.e., by the NASD), §§ 15A(g), 15A(h), 25(a), 15 U.S.C. §§ 78o 3(g), 78o—3(h), 78y(a); see R. H. Johnson & Co. v. Securities & Exchange Comm., 198 F.2d 690 (C.A.2d Cir.1952), cert. denied, 344 U.S. 855, 73 S.Ct. 94, 97 L.Ed. 664, a different case would arise concerning exemption from the operation of laws designed to prevent anticompetitive activity, an issue we do not decide today.
13
Although the recently issued first segment of the Report of the Special Study of Securities Markets is more critical of situations in the over-the-counter market and with reference to exchanges other than the respondent, it does point out that improper selling practices have occurred among member firms of respondent, c. IIIB, pp. 178—179, 183—184, and suggests the need for new Commission rules to govern selling practices of securities dealers, id., p. 186.
14
The Exchange argues that total disclosure of the reasons for its action and of the sources of its information will subject it and its informants to a risk of being sued for defamation in many instances. This risk, however, is properly met by the flexibility inherent in the law of defamation in the concept of the conditional or qualified privilege. 1 Harper and James, The Law of Torts (1956), §§ 5.21, 5.25, 5.26, especially § 5.26, at 442, n. 3. In addition, even if a particular communication of information to the Exchange should fall outside the scope of such a privilege, the Exchange can protect itself and its informant from expansion of damage liability by confining the hearing, unless otherwise requested by the aggrieved nonmember, to the parties to the dispute and the necessary witnesses, so as to limit the area of dissemination of the defamatory matter. See 1 Harper and James, op. cit., supra, § 5.30, at 469. Similarly, any concern that our holding exposes the Exchange to excessive liability for past enforcement of its rules accomplished without a hearing ignores the presumable applicability of familiar principles of waiver, laches, and estoppel to bar relief to a nonmember who failed to make timely and appropriate protest to the Exchange.
15
The affording of procedural safeguards will not burden the New York Stock Exchange; notice and hearing are already guaranteed by its Constitution, Art. XIV, § 14, to any member accused of violating its rules. The existence of these guarantees goes far toward dispelling fears that provision of a hearing to nonmembers would interfere significantly with the need for timely Exchange action, for it can surely be assumed that prompt action is as much required to deal with member wrongdoing as with that of a nonmember. We have no doubt, moreover, that provision of a hearing to a protesting nonmember can, when circumstances require, be accomplished expeditiously enough to prevent injury to investors. Indeed, if the basis for invocation of an Exchange rule is also a violation of the Securities Act of 1933, the Securities Exchange Act of 1934, or the Commission's rules and regulations under either statute, the Commission can come to the aid of the Exchange by obtaining a preliminary or permanent injunction or restraining order against such practice in the appropriate United States District Court. Securities Act of 1933, § 20(b), 15 U.S.C. § 77t(b); Securities Exchange Act of 1934, § 21(e), 15 U.S.C. § 78u(e). It is significant, however, that the Commission's power to obtain restraint of particular violation is confined to traditional judicial channels with the safeguards implied thereby, and that when the Commission, pursuant to the powers conferred on it by Congress in the Maloney Act of 1938, wishes to resort to the more drastic sanction of suspending or revoking the membership in the NASD of a wrongdoing over-the-counter dealer, it may only do so 'after appropriate notice and opportunity for hearing * * *.' § 15A(l), 15 U.S.C. § 78o—3(l).
16
It may be assumed that the Securities and Exchange Commission would have had the power, under § 19(b) of the Exchange Act, 15 U.S.C. § 78s(b), pp. 352—353, 357 & note 7, supra, to direct the Exchange to adopt a general rule providing a hearing and attendant procedures to nonmembers. However, any rule that might be adopted by the Commission would, to be consonant with the antitrust laws, have to provide as a minimum the procedural safeguards which those laws make imperative in cases like this. Absent Commission adoption of a rule requiring fair procedure, and in light of both the utility of such a rule as an antitrust matter and its compatibility with securities-regulation principles, see p. 361, supra, no incompatibility with the Commission's power inheres in announcement by an antitrust court of the rule. Compare Colorado Anti-Discrimination Comm. v. Continental Air Lines, Inc., 372 U.S. 714, 723—724, 83 S.Ct. 1022, 1026—1027.
17
The basic nature of the rights which we hold to be required under the antitrust laws in the circumstances of today's decision is indicated by the fact that public agencies, labor unions, clubs, and other associations have, under various legal principles, all been required to afford notice, a hearing, and an opportunity to answer charges to one who is about to be denied a valuable right. Goldsmith v. United States Board of Tax Appeals, 270 U.S. 117, 46 S.Ct. 215, 70 L.Ed. 494; Russell v. Duke of Norfolk, (1949) 1 All E.R. 109 (C.A.); Fellman, Constitutional Rights of Association, in The Supreme Court Review, 1961 (Kurland ed.), 74, 104, 112—113; Developments in the Law—Judicial Control of Actions of Private Associations, 76 Harv.L.Rev. 983, 1026—1037 (1963); see authorities cited note 18, infra; cf. Vitarelli v. Seaton, 359 U.S. 535, 79 S.Ct. 968, 3 L.Ed.2d 1012; Cafeteria & Restaurant Workers Union, Local 473, AFL—CIO v. McElroy, 367 U.S. 886, 894—895, 81 S.Ct. 1743, 1748, 6 L.Ed.2d 1230; Willner v. Committee on Character and Fitness, 373 U.S. 96, 83 S.Ct. 1175.
18
The principle that a private association's failure to afford procedural safeguards may result in the imposition of damage liability without inquiry into whether the association's action lacked substantive basis is reflected in many state-court decisions, resting on various theories of liability. Cason v. Glass Bottle Blowers Ass'n, 37 Cal.2d 134, 231 P.2d 6, 21 A.L.R.2d 1387 (1951); Lahiff v. Saint Joseph's Total Abstinence & Benevolent Soc., 76 Conn. 648, 57 A. 692, 65 L.R.A. 92 (1904); Malmsted v. Minneapolis Aerie, 111 Minn. 119, 126 N.W. 486 (1910); Johnson v. International of United Brotherhood of Carpenters, 52 Nev. 400, 288 P. 170 (1930); 54 Nev. 332, 16 P.2d 658, 18 P.2d 448 (1932); Brooks v. Engar, 259 App.Div. 333, 19 N.Y.S.2d 114 (1st Dept.), appeal dismissed, 284 N.Y. 767, 31 N.E.2d 514 (1940); Blek v. Wilson, 145 Misc. 373, 259 N.Y.S. 443 (Sup.Ct.1932), modified and aff'd, 237 App.Div. 712, 262 N.Y.S. 416 (1st Dept.), rev'd on other grounds, 262 N.Y. 253, 186 N.E. 692 (1933); Glauber v. Patof, 183 Misc. 400, 47 N.Y.S.2d 762 (Sup.Ct.1944), aff'd mem., 269 App.Div. 687, 54 N.Y.S.2d 384 (1st Dept.), modified per curiam on other grounds, 294 N.Y. 583, 63 N.E.2d 181 (1945); O'Brien v. Papas, 49 N.Y.S.2d 521 (Sup.Ct.1944); Taxicab Drivers' Local Union No. 889 v. Pittman, 322 P.2d 159 (Okl.1957); International Printing Pressmen & Assistants' Union of North America v. Smith, 145 Tex. 399, 198 S.W.2d 729 (1946); Leo v. Local Union No. 612 of International Union of Operating Engineers, 26 Wash.2d 498, 174 P.2d 523, 168 A.L.R. 1440 (1946) (alternative holding). See also Developments in the Law, supra, 76 Harv.L.Rev., at 1087—1095; Note, Procedural 'Due Process' in Union Disciplinary Proceedings, 57 Yale L.J. 1302 (1948). The precedents cited undoubtedly rest on a recognition that the according of fair procedures is of fundamental significance, that serious and irreversible economic injury may result from their denial in a context like that of the present case, and that a substantive inquiry after the fact cannot possibly succeed in accurately ascertaining retrospectively what the outcome would have been had the procedural safeguards been afforded in the first instance. The conditioning of relief for the procedural breach on a finding that a concomitant substantive breach occurred might well, therefore, result in an ultimate wrongful denial of recovery to a party in the position of petitioners here.
1
See, e.g., Radiant Burners, Inc. v. Peoples Gas Light & Coke Co., 364 U.S. 656, 81 S.Ct. 365, 5 L.Ed.2d 358; Klor's, Inc. v. Broadway-Hale Stores, Inc., 359 U.S. 207, 79 S.Ct. 705, 3 L.Ed.2d 741; Fashion Originators' Guild America v. Federal Trade Comm., 312 U.S. 457, 61 S.Ct. 703, 85 L.Ed. 949. It may be assumed, I think, that almost every exercise of an exchange's statutory duty of self-regulation would involve an actual or threatened concerted refusal to deal—a 'group boycott.'
2
See ante, p. 364, note 16. Contrary to the Court's suggestion, there has not been a total absence of agency or legislative attention to the problems of the Exchange's disciplinary machinery. In § 19(c) of the 1934 Act, Congress expressly ordered the Securities and Exchange Commission to study the exchanges' procedures for disciplining members and to report back on the need for further legislation. The Commission reported the following year, giving a detailed account of existing procedures and making specific recommendations for
reform. H.R.Doc. No. 85, 74th Cong., 1st Sess. (Jan. 25, 1935). It advised against legislation, however, suggesting that the exchanges themselves be given the opportunity to adopt the recommendations voluntarily. The agency also undertook to continue its surveillance of such procedures and to report to Congress 'such further recommendations as it may deem advisable in regard to exchange government.' Id., at 17. In its 1935 Annual Report, the Commission stated that the respondent Exchange, as well as many others, had voluntarily complied. 1 S.E.C.Ann.Rep. 20 (1935). The process of surveillance has continued. In 1938, a general overhaul of the respondent Exchange's constitution was effected by informal Commission action. See 2 Loss, Securities Regulation, 1179—1182. In 1941, the Commission's proposals for statutory amendments included a specific request to extend § 19(b) rule-making authority over rules governing discipline of members. Report of the Securities and Exchange Commission on Proposals for Amendments to the Securities Act of 1933 and the Securities Exchange Act of 1934, House Committee Print, Committee on Interstate and Foreign Commerce, 77th Cong., 1st Sess. 40 (Aug. 7, 1941). The proposal was not acted upon. Exchange disciplinary procedures were again examined in recent congressional hearings concerning the operation of the stock market. The absence of review by the Commission in individual cases was noted, but representatives of the respondent Exchange also testified that all such actions are reported informally to the agency. A detailed account of the Exchange's present procedures was included in the record. Hearings before a Subcommittee of the House Committee on Interstate and Foreign Commerce on H.J.Res. 438, 87th Cong., 1st Sess. 107—113. These recent hearings have led to an exhaustive study of current stock market conditions, and completion of the resulting report by the Commission is imminent. See Securities Exchange Act of 1934, § 19(d), added by 75 Stat. 465, as amended, 76 Stat. 247, 15 U.S.C. (Supp. IV) § 78s(d); S.E.C., Report of Special Study of Securities Markets (Apr. 3, 1963).
3
The Court pointed out that 'An elaborate system of trial and appellate tribunals exists, for the determination of whether a given garment is in fact a copy of a Guild member's design.' 312 U.S., at 462—463, 61 S.Ct. at 706. See also Klor's, Inc. v. Broadway-Hale Stores, Inc., 359 U.S. 207, 212, 79 S.Ct. 705, 709, 3 L.Ed.2d 741.
4
254 U.S. 443, 41 S.Ct. 172, 65 L.Ed. 349. See Apex Hosiery Co. v. Leader, 310 U.S. 469, 60 S.Ct. 982, 84 L.Ed. 1311; United States v. Hutcheson, 312 U.S. 219, 61 S.Ct. 463, 85 L.Ed. 788.
5
For example, an exchange would be liable under the antitrust laws if it conspired with outsiders, or if it attempted to use its power to monopolize. United States v. Borden Co., 308 U.S. 188, 60 S.Ct. 182, 84 L.Ed. 181; Maryland & Virginia Milk Producers Ass'n v. United States, 362 U.S. 458, 80 S.Ct. 847, 4 L.Ed.2d 880; Allen Bradley Co. v. Local Union No. 3, IBEW, 325 U.S. 797, 65 S.Ct. 1533, 89 L.Ed. 1939. Furthermore, individual members of an exchange would be liable if it were shown that they had conspired to use the exchange's machinery for the purpose of suppressing competition. Cf. Georgia v. Pennsylvania R. Co., 324 U.S. 439, 65 S.Ct. 716, 89 L.Ed. 1051; United States v. Pacific & Artic Ry. & Nav. Co., 228 U.S. 87, 33 S.Ct. 443, 57 L.Ed. 742. Application of the antitrust laws to such conduct would rest on the presence of an independent violation, not, as the present case does, simply upon concerted activity by the exchange and its members.
| 78
|
373 U.S. 375
83 S.Ct. 1311
10 L.Ed.2d 420
John Thomas AVENT et al., petitioners,v.STATE OF NORTH CAROLINA.
No. 11.
Supreme Court of the United States
October Term, 1962.
May 20, 1963
Jack Greenberg, New York City, for petitioners.
Ralph Moody, Raleigh, N. C., for respondent.
Solicitor General Archibald Cox, for the United States, as amicus curiae, by special leave of Court.
On Writ of Certiorari to the Supreme Court of the State of North Carolina.
PER CURIAM.
1
The judgment is vacated and the case is remanded to the Supreme Court of North Carolina for consideration in the light of Peterson v. City of Greenville, 373 U.S. 244, 83 S.Ct. 1119. Patterson v. Alabama, 294 U.S. 600, 55 S.Ct. 575, 79 L.Ed. 1082.
2
[For opinion of MR. JUSTICE HARLAN, see 373 U.S. 248, 83 S.Ct. 1133.]
| 12
|
373 U.S. 262
83 S.Ct. 1130
10 L.Ed.2d 335
F. L. SHUTTLESWORTH and C. Billups, Petitioners,v.CITY OF BIRMINGHAM, ALA.
No. 67.
Argued Nov. 6, and 7, 1962.
Decided May 20, 1963.
Mrs. Constance B. Motley, New York City, for petitioners.
Watts E. Davis, Birmingham, Ala., for respondent.
Mr. J. M. Breckenridge, Birmingham, Ala., for respondent.
Archibald Cox, Sol. Gen., for the United States, as amicus curiae, by special leave of Court.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
The petitioners, both Negro ministers, were tried and convicted in the Birmingham, Alabama, Recorder's Court for aiding and abetting a violation of the city criminal trespass ordinance. The complaint filed with respect to Shuttlesworth charged:
2
'Comes the City of Birmingham, Alabama, a municipal corporation, and complains that F. L. Shuttlesworth, within twelve months before the beginning of this prosecution, and within the City of Birmingham or the police jurisdiction thereof, did incite or aid or abet in the violation of an ordinance of the City, towit, Section 14361 of the General City Code of Birmingham of 1944, in that F. L. Shuttlesworth did incite or aid or abet another person to go or remain on the premises of another after being warned not to do so, contrary to and in violation of Section 8242 of the General City Code of Birmingham of 1944.' (Footnotes added.)
3
An identical complaint was filed charging Billups.
4
On appeal to the Circuit Court petitioners received a trial de novo and were again convicted. Petitioner Shuttlesworth was sentenced to 180 days in jail at hard labor and a fine of $100. Petitioner Billups was sentenced to 30 days and a fine of $25. On further appeal to the Alabama Court of Appeals the convictions were affirmed. 41 Ala.App. 318, 319, 134 So.2d 213, 215. The Alabama Supreme Court denied writs of certiorari. 273 Ala. 704, 713, 134 So.2d 214, 215. Because of the grave constitutional questions involved, we granted certiorari. 370 U.S. 934, 82 S.Ct. 1580, 8 L.Ed.2d 805.
5
Though petitioners took separate appeals, they were jointly tried in the Circuit Court. The evidence is sketchy in character. Only one witness testified, a city detective who had listened to petitioners' trial in the Recorder's Court.3 The detective testified to his recollection of the testimony of two college boys whom (among others) petitioners were alleged to have incited to commit the criminal trespass.
6
These two boys were James E. Gober and James Albert Davis. They were convicted of criminal trespass in a separate proceeding subsequent to petitioners' trial. In Gober v. City of Birmingham, 373 U.S. 374, 83 S.Ct. 1311, we hold on the authority of Peterson v. City of Greenville, 373 U.S. 244, 83 S.Ct. 1119, that the convictions of Gober and Davis are constitutionally invalid. The detective stated that in the Recorder's Court Gober and Davis had testified as follows:
7
James Gober and James Albert Davis, both Negro college students, went to the home of petitioner, Rev. Shuttlesworth, on March 30, 1960, where there were other college students. Petitioner, Rev. Billups, drove Davis there, and Billups was present when Shuttlesworth asked for volunteers to participate in 'sit-down demonstrations.' Gober 'testified that in response to Rev. Shuttlesworth asking for volunteers to participate in the sit down strikes that he volunteered to go to Pizitz at 10:30 and take part in the sit down demonstrations.' A list was made by someone, and Shuttlesworth announced he would get them out of jail. Gober and Davis participated in sit-down demonstrations on the following day as did others who were present.
8
This is the sole evidence upon which the petitioners were convicted. There was no evidence that any of the demonstrations which resulted from the meeting were disorderly or otherwise in violation of law.
9
Petitioners contend that there is no evidence to show guilt of the charged offense. See Garner v. Louisiana, 368 U.S. 157, 82 S.Ct. 248, 7 L.Ed.2d 207; Thompson v. Louisville, 362 U.S. 199, 80 S.Ct. 624, 4 L.Ed.2d 654. We need not reach that question since there is a more compelling reason why these convictions cannot stand.
10
Petitioners were convicted for inciting, aiding, and abetting a violation of the city trespass ordinance. The trespass 'violation' was that committed by the petitioners in Gober v. City of Birmingham, 373 U.S. 374, 83 S.Ct. 1311.4 Since the convictions in Gober have been set aside, it follows that the present petitioners did not incite or aid and abet any crime, and that therefore their own convictions must be set aside.
11
It is generally recognized that there can be no conviction for aiding and abetting someone to do an innocent act. See, e.g., Edwards v. United States, 286 F.2d 681 (C.A.5th Cir. 1960); Meredith v. United States, 238 F.2d 535 (C.A.4th Cir. 1956); Colosacco v. United States, 196 F.2d 165 (C.A.10th Cir. 1952); Karrell v. United States, 181 F.2d 981, 985 (C.A.9th Cir. 1950); Manning v. Biddle, 14 F.2d 518 (C.A.8th Cir. 1926); Kelley v. Florida, 79 Fla. 182, 83 So. 909, 16 A.L.R. 1465 (1920); Commonwealth v. Long, 246 Ky. 809, 811—812, 56 S.W.2d 524, 525 (1933); Cummings v. Commonwealth, 221 Ky. 301, 313, 298 S.W. 943, 948 (1927); State v. St. Philip, 169 La. 468, 471—472, 125 So. 451, 452 (1929); State v. Haines, 51 La.Ann. 731, 25 So. 372, 44 L.R.A. 837 (1899); Wages v. State, 210 Miss. 187, 190, 49 So.2d 246, 248 (1950); State v. Cushing, 61 Nev. 132, 146, 120 P.2d 208, 215 (1941); State v. Hess, 233 Wis. 4, 8—9, 288 N.W. 275, 277 (1939); cf. Langham v. State, 243 Ala. 564, 571, 11 So.2d 131, 137 (1942).
12
Reversed.
1
Birmingham General City Code, 1944, § 1436, provides:
'After Warning—Any person who enters into the dwelling house, or goes or remains on the premises of another, after being warned not to do so, shall on conviction, be punished as provided in Section 4, provided, that this Section shall not apply to police officers in the discharge of official duties.'
2
Birmingham General City Code, 1944, § 824, provides:
'It shall be unlawful for any person to incite, or aid or abet in, the violation of any law or ordinance of the city, or any provision of state law, the violation of which is a misdemeanor.'
3
Petitioners objected to all of this testimony as hearsay and on constitutional grounds, but these objections were overruled.
4
The trial court stated, '(Y)ou have here the ten students and the Court thinks they were misused and misled into a violation of a City Ordinance and has so ruled.' As we understand the record, these convictions were based upon the inciting of the 10 students who are the petitioners in Gober.
| 12
|
373 U.S. 503
83 S.Ct. 1336
10 L.Ed.2d 513
Raymond L. HAYNES, Petitioner,v.STATE OF WASHINGTON.
No. 147.
Argued Feb. 26 and 27, 1963.
Decided May 27, 1963.
Lawrence Speiser, Washington, D.C., for petitioner.
George A. Kain, Spokane, Wash., for respondent.
Mr. Justice GOLDBERG delivered the opinion of the Court.
1
The petitioner, Raymond L. Haynes, was tried in a Superior Court of the State of Washington on a charge of robbery, found guilty by a jury, and sentenced to imprisonment 'for a term of not more than 20 years.' The Washington Supreme Court affirmed the conviction, with four of nine judges dissenting. 58 Wash.2d 716, 364 P.2d 935. Certiorari was granted, 370 U.S. 902, 82 S.Ct. 1252, 8 L.Ed.2d 399, to consider whether the admission of the petitioner's written and signed confession into evidence against him at trial constituted a denial of due process of law.
2
Haynes contends that the confession was involuntary, and thus constitutionally inadmissible, because induced by police threats and promises. He testified at trial that during the approximately 16-hour period between the time of his arrest and the making and signing of the written confession, he several times asked police to allow him to call an attorney and to call his wife. He said that such requests were uniformly refused and that he was repeatedly told that he would not be allowed to call unless and until he 'cooperated' with police and gave them a written and signed confession admitting participation in the robbery. He was not permitted to phone his wife, or for that matter anyone, either on the night of his arrest or the next day. The police persisted in their refusals to allow him contact with the outside world, he said, even after he signed one written confession and after a preliminary hearing before a magistrate, late on the day following his arrest. According to the petitioner, he was, in fact, held incommunicado by the police until some five or seven days after his arrest.1
3
The State asserts that the petitioner's version of events is contradicted, that the confession was freely given, and that, in any event, the question of voluntariness was conclusively resolved against the petitioner by the verdict of the jury at trial. We consider each of these contentions in turn.
I.
4
The petitioner was charged with robbing a gasoline service station in the City of Spokane, Washington, at about 9 p.m. on Thursday, December 19, 1957. He was arrested by Spokane police in the vicinity of the station within approximately one-half hour after the crime.2 Though he orally admitted the robbery to officers while en route to the police station, he was, on arrival there, not charged with the crime, but instead booked for 'investigation,' or, as it is locally called, placed on the 'small book.' Concededly, prisoners held on the 'small book' are permitted by police neither to make phone calls nor to have any visitors.3
5
Shortly after arriving at the station at about 10 p.m., the petitioner was questioned for about one-half hour by Lieutenant Wakeley of the Spokane police, during which period he again orally admitted the crime. He was then placed in a line-up and identified by witnesses as one of the robbers. Apparently, nothing else was done that night.
6
On the following morning, beginning at approximately 9:30 a.m., the petitioner was again questioned for about an hour and a half, this time by Detectives Peck and Cockburn. He once more orally admitted the robbery, and a written confession was transcribed. Shortly thereafter, he was taken to the office of the deputy prosecutor, where still another statement was taken and transcribed. Though Haynes refused to sign this second confession, he then did sign the earlier statement given to Detectives Peck and Cockburn.4 Later that same afternoon he was taken before a magistrate for a preliminary hearing; this was at about 4 p.m. on December 20, the day after his arrest.
7
At the conclusion of the hearing, Haynes was transferred to the county jail and on either the following Tuesday or Thursday was returned to the deputy prosecutor's office. He was again asked to sign the second statement which he had given there some four to six days earlier, but again refused to do so.
8
The written confession taken from Haynes by Detectives Peck and Cockburn on the morning after his arrest and signed by Haynes on the same day in the deputy prosecutor's office was introduced into evidence against the petitioner over proper and timely objection by his counsel that such use would violate due process of law. Under the Washington procedure then in effect,5 voluntariness of the confession was treated as a question of fact for ultimate determination by the jury. In overruling the petitioner's objection to use of the confession, the trial judge, however, made an apparently preliminary determination that it was voluntary and 'conditionally' admissible. See 58 Wash.2d, at 719 720, 364 P.2d, at 937. The evidence going to voluntariness was heard before the jury was the issue submitted to it. The jury returned a general verdict of guilty and was not required to, and did not, indicate its view with respect to the voluntariness of the confession.
II.
9
The State first contends that the petitioner's version of the circumstances surrounding the making and signing of his written confession is evidentially contradicted and thus should be rejected by this Court. We have carefully reviewed the entire record, however, and find that Haynes' account is uncontradicted in its essential elements.
10
Haynes testified that on the evening of his arrest he made several specific requests of the police that he be permitted to call an attorney and to call his wife. Each such request, he said, was refused. He stated, however, that he was told he might make a call if he confessed:
11
'They kept wanting me to own up to robbing a Richfield Service Station and I asked Mr. (Detective) Pike several times if I could call a lawyer and he said if I cooperated and gave him a statement * * * that I would be allowed to call, to make a phone call. * * *'
12
On cross-examination, Lieutenant Wakeley, the officer who interrogated the petitioner on the night of his arrest, first said that Haynes did not ask him for permission to call his wife, but merely inquired whether his wife would be notified of his arrest. Lieutenant Wakeley said that he told the petitioner that his wife would be notified.6 Defense counsel, however, pursued the point and, only a moment later, Wakeley testified that Haynes 'may have' asked permission to call his wife himself; Wakeley said he didn't 'remember exactly whether he asked or whether we wouldn't notify his wife.' Wakeley then testified that he simply didn't 'remember' whether Haynes asked to call his wife so that she might secure a lawyer for him; in addition, the lieutenant admitted that the petitioner might have asked to call his wife after the interrogation was completed. Detective Pike, also testifying at trial, said simply that he had not talked to Haynes on the evening of the arrest.
13
If this were the only evidence of police coercion and inducement in the record, we would face the problem of determining whether, in view of the testimony of Lieutenant Wakeley and Detective Pike, the petitioner's own testimony would be sufficient, on review by this Court, to establish the existence of impermissible police conduct barring use of the written confession ultimately obtained. We need not pursue such an inquiry, however, since the record contains other probative, convincing, and uncontradicted evidence.
14
The written confession introduced at trial was dictated and transcribed while Haynes was being questioned by Detectives Peck and Cockburn on the morning of December 20, the day after the robbery. Haynes testified:
15
'Q. * * * (S)tate whether or not the officers at that time asked you to give them a statement. A. Yes.
16
'Q. And what was your answer to that? A. I wanted to call my wife.
17
'Q. And were you allowed to call your wife? A. No.
18
'Q. * * * This was on Friday? A. Friday.
19
'Q. December 20th? A. Yes.
20
'Q. And was anything else said with respect to making a telephone call? A. Mr. Pike (sic) and the other officer both told me that when I had made a statement and cooperated with them that they would see to it that as soon as I got booked I could call my wife.
21
'Q. Well, that was the night before you were told that, wasn't it? A. I was told that the next day too, several times.
22
'Q. Who were the officers that were with you' A. Oh, not Mr. Pike. Mr. Cockburn and Mr. Peck, I believe.
23
'Q. In any event, Mr. Haynes, did you soon after that give them a statement? A. Well, not readily.
24
'Q. Did you give them a statement? A. Yes.'
25
The transcribed statement itself discloses that early in the interrogation Haynes asked whether he might at least talk to the prosecutor before proceeding further. He was told: 'We just want to get this down for our records, and then we will go to the prosecutor's office and he will ask the same questions that I am.'
26
Whatever contradition of Haynes' account of his interrogation on the night of his arrest might be found in the testimony of Lieutenant Wakeley and Detective Pike, his explicit description of the circumstances surrounding his questioning and the taking by Detectives Peck and Cockburn of the challenged confession on the following day remains testimonially undisputed. Though he took the stand at trial, Detective Cockburn did not deny that he or Detective Peck had told the petitioner that he might call his wife only if he 'cooperated' and gave the police a statement. Cockburn said merely that he could not 'remember' whether Haynes had asked to call his wife. He conceded that the petitioner 'could have' made such a request. No legal alchemy can transmute such wholly equivocal testimony into a denial or refutation of the petitioner's specific recitation of events. Detective Peck did not testify and no other evidence was presented to contradict the petitioner's testimony, either as part of the prosecution's case in chief or, even more importantly, by way of rebuttal subsequent to the petitioner's testimony. We cannot but attribute significance to the failure of the State, after listening to the petitioner's direct and explicit testimony, to attempt to contradict that crucial evidence; this testimonial void is the more meaningful in light of the availability and willing co-operation of the policemen who, if honestly able to do so, could have readily denied the defendant's claims. Similarly, no evidence was offered to contradict in any way the petitioner's testimony that when first taken to the deputy prosecutor's office to sign the statement he had given to Detectives Peck and Cockburn he again requested permission to call his wife and was again refused.7
27
Though the police were in possession of evidence more than adequate to justify his being charged without delay, it is uncontroverted that Haynes was not taken before a magistrate and granted a preliminary hearing until he had acceded to demands that he give and sign the written statement. Nor is there any indication in the record that prior to signing the written confession, or even thereafter, Haynes was advised by authorities of his right to remain silent, warned that his answers might be used against him, or told of his rights respecting consultation with an attorney.
28
In addition, there is no contradiction of Haynes' testimony that even after he submitted and supplied the written confession used at trial, the police nonetheless continued the incommunicado detention while persisting in efforts to secure still another signature on another statement.8 Upon being returned to the deputy prosecutor's office during the week following his arrest and while still being held incommunicado, the petitioner was again asked to sign the second statement which he had given there several days earlier. He refused to do so, he said, because, as he then told the deputy prosecutor, 'all the promises of all the officers I had talked to had not been fulfilled and I had not been able to call my wife and I would sign nothing under any conditions until I was allowed to call my wife to see about legal counsel.' The State offered no evidence to rebut this testimony.9 Similarly uncontradicted is Haynes' testimony that it was not until during or after this second interview with the prosecutor on the Tuesday or Thursday—Haynes could not be quite certain—but, in any event, some five or seven days after his arrest, that he was first allowed to call his wife.
29
The contested written confession itself contains the following exchange:
30
'Q. Have we made you any threats or promises? A. No.
31
'Q. Has (sic) any police officers made you any promises or threats? A. No—except that the Lieutenant promised me that as soon as I was booked that I could call my wife.
32
'Q. You are being held for investigation—you haven't been booked yet. When you are, you will be able to phone your wife.'
33
The State argues that the quoted answers to the first two of these questions conclusively negative existence of coercion or inducement on the part of the police. The statement bears no such reading, however. The questions on their face disclose that the petitioner was told that 'booking' was a prerequisite to calling his wife, and 'booking' must mean booking on a charge of robbery. Since the police already had enough evidence to warrant charging the petitioner with the robbery—they had the petitioner's prior oral admissions, the circumstances surrounding his arrest, and his identification by witnesses—the only fair inference to be drawn under all the circumstances is that he would not be booked on the robbery charge until the police had secured the additional evidence they desired, the signed statement for which they were pressing. The quoted portions of the signed confession thus support the petitioner's version of events; under any view, they offer no viable or reliable contradiction.
34
Even were it otherwise, there would be substantial doubt as to the probative effect to be accorded recitations in the challenged confession that it was not involuntarily induced. Cf. Haley v. Ohio, 332 U.S. 596, 601, 68 S.Ct. 302, 304, 92 L.Ed. 224 (opinion of Mr. Justice Douglas). It would be anomalous, indeed, if such a statement, contained within the very document asserted to have been obtained by use of impermissible coercive pressures, was itself enough to create an evidentiary conflict precluding this Court's effective review of the constitutional issue. Common sense dictates the conclusion that if the authorities were successful in compelling the totally incriminating confession of guilt, the very issue for determination, they would have little, if any, trouble securing the self-contained concession of voluntariness. Certainly, we cannot accord any conclusive import to such an admission, particularly when, as here, it is immediately followed by recitations supporting the petitioner's version of events.
III.
35
The uncontroverted portions of the record thus disclose that the petitioner's written confession was obtained in an atmosphere of substantial coercion and inducement created by statements and actions of state authorities. We have only recently held again that a confession obtained by police through the use of threats is violative of due process and that 'the question in each case is whether the defendant's will was overborne at the time he confessed,' Lynumn v. Illinois, 372 U.S. 528, 534, 83 S.Ct. 917, 920, 9 L.Ed.2d 922. 'In short, the true test of admissibility is that the confession is made freely, voluntarily, and without compulsion or inducement of any sort.' Wilson v. United States, 162 U.S. 613, 623, 16 S.Ct. 895, 40 L.Ed. 1090. See also Bram v. United States, 168 U.S. 532, 18 S.Ct. 183, 42 L.Ed. 568. And, of course, whether the confession was obtained by coercion or improper inducement can be determined only by an examination of all of the attendant circumstances. See, e.g., Leyra v. Denno, 347 U.S. 556, 558, 74 S.Ct. 716, 717, 98 L.Ed. 948.10 Haynes' undisputed testimony as to the making and signing of the challenged confession used against him at trial permits no doubt that it was obtained under a totality of circumstances evidencing an involuntary written admission of guilt.
36
Here, as in Lynumn, supra, the petitioner was alone in the hands of the police, with no one to advise or aid him, and he had 'no reason not to believe that the police had ample power to carry out their threats,' 372 U.S., at 534, 83 S.Ct., at 920, to continue, for a much longer period if need be, the incommunicado detention—as in fact was actually done. Neither the petitioner's prior contacts with the authorities nor the fact that he previously had made incriminating oral admissions negatives the existence and effectiveness of the coercive tactics used in securing the written confession introduced at trial. The petitioner at first resisted making a written statement and gave in only after consistent denials of his requests to call his wife, and the conditioning of such outside contact upon his accession to police demands. Confronted with the express threat of continued incommunicado detention and induced by the promise of communication with and access to family Haynes understandably chose to make and sign the damning written statement; given the unfair and inherently coercive context in which made, that choice cannot be said to be the voluntary product of a free and unconstrained will, as required by the Fourteenth Amendment.
37
We cannot blind ourselves to what experience unmistakably teaches: that even apart from the express threat, the basic techniques present here—the secret and incommunicado detention and interrogation—are devices adapted and used to extort confessions from suspects. Of course, detection and solution of crime is, at best, a difficult and arduous task requiring determination and persistence on the part of all responsible officers charged with the duty of law enforcement. And, certainly, we do not mean to suggest that all interrogation of witnesses and suspects is impermissible. Such questioning is undoubtedly an essential tool in effective law enforcement. The line between proper and permissible police conduct and techniques and methods offensive to due process is, at best, a difficult one to draw, particularly in cases such as this where it is necessary to make fine judgments as to the effect of psychologically coercive pressures and inducements on the mind and will of an accused. But we cannot escape the demands of judging or of making the difficult appraisals inherent in determining whether constitutional rights have been violated. We are here impelled to the conclusion, from all of the facts presented, that the bounds of due process have been exceeded.
IV.
38
Our conclusion is in no way foreclosed, as the State contends, by the fact that the state trial judge or the jury may have reached a different result on this issue.
39
It is well settled that the duty of constitutional adjudiciation resting upon this Court requires that the question whether the Due Process Clause of the Fourteenth Amendment has been violated by admission into evidence of a coerced confession be the subject of an independent determination here, see, e.g., Ashcraft v. Tennessee, 322 U.S. 143, 147—148, 64 S.Ct. 921, 923, 88 L.Ed. 1192; 'we cannot escape the responsibility of making our own examination of the record,' Spano v. New York, 360 U.S. 315, 316, 79 S.Ct. 1202, 1203, 3 L.Ed.2d 1265. While, for purposes of review in this Court, the determination of the trial judge or of the jury will ordinarily be taken to resolve evidentiary conflicts and may be entitled to some weight even with respect to the ultimate conclusion on the crucial issue of voluntariness, we cannot avoid our responsibilities by permitting ourselves to be 'completely bound by state court determination of any issue essential to decision of a claim of federal right, else federal law could be frustrated by distorted fact finding.' Stein v. New York, 346 U.S. 156, 181, 73 S.Ct. 1077, 1091, 97 L.Ed. 1522. As state courts are, in instances such as this, charged with the primary responsibility of protecting basic and essential rights, we accord an appropriate and substantial effect to their resolutions of conflicts in evidence as to the occurrence or nonoccurrence of factual events and happenings. This is particularly apposite because the trial judge and jury are closest to the trial scene and thus afforded the best opportunity to evaluate contradictory testimony. But, as declared in Ward v. Texas, 316 U.S. 547, 550, 62 S.Ct. 1139, 1141, 86 L.Ed. 1663, 'when, as in this case, the question is properly raised as to whether a defendant has been denied the due process of law * * * we cannot be precluded by the verdict of a jury from determining whether the circumstances under which the confession was made were such that its admission in evidence amounts to a denial of due process.' To the same effect, see, e.g., Spano v. New York, 360 U.S. 315, 79 S.Ct. 1202, 3 L.Ed.2d 1265; Thomas v. Arizona, 356 U.S. 390, 393, 78 S.Ct. 885, 887, 2 L.Ed.2d 863; Payne v. Arkansas, 356 U.S. 560, 562, 568, 78 S.Ct. 844, 847, 850, 2 L.Ed.2d 975; Ashcraft v. Tennessee, 322 U.S. 143, 147—148, 64 S.Ct. 921, 923, 88 L.Ed. 1192; Lisenba v. California, 314 U.S. 219, 237—238, 62 S.Ct. 280, 290, 86 L.Ed. 166; Chambers v. Florida, 309 U.S. 227, 228, 60 S.Ct. 472, 473, 84 L.Ed. 716.
40
Beyond even the compelling nature of our precedents, however, there is here still another reason for refusing to consider the present inquiry foreclosed by the verdict of the jury to which the issue of voluntariness of the confession was submitted. The jury was instructed, in effect, not to consider as relevant on the issue of voluntariness of the confession the fact that a defendant is not reminded that he is under arrest, that he is not cautioned that he may remain silent, that he is not warned that his answers may be used against him, or that he is not advised that he is entitled to counsel.11 Whatever independent consequence these factors may otherwise have, they are unquestionably attendant circumstances which the accused is entitled to have appropriately considered in determining voluntariness and admissibility of his confession.12
41
In addition, the trial court instructed in terms of a Washington statute which permits consideration of a corroborated confession 'made under inducement' and excepts only confessions 'made under the influence of fear produced by threats.'13 It seems reasonably clear from this portion of the instructions that the jury may well have been misled as to the requisite constitutional standard, notwithstanding the apparent propriety of other portions of the instructions. Given the fact that the jury did no more than return a general verdict of guilty, we obviously have no way of knowing whether it found the confession to be voluntary and admissible or not. Because there was sufficient other evidence to sustain the verdict, the jury may have found the defendant guilty even though it rejected the confession as involuntary; alternatively, the jury may have based its finding of guilt on the confession, reasoning, under the questionable instructions and the Washington statute, that the confession was admissible as voluntary, even though improperly induced, because it was corroborated by the other evidence. Although, for the reasons indicated, the Washington statute and the quoted instructions raise a serious and substantial question whether a proper constitutional standard was applied by the jury, we need not rely on the imperfections in the instructions as a separate ground of reversal. We think it clear, however, that these imperfections are entirely sufficient to preclude any dependence we might otherwise place on the jury verdict as settling the issue of voluntariness here.
V.
42
In reaching the conclusion which we do, we are not unmindful of substantial independent evidence tending to demonstrate the guilt of the petitioner. As was said in Rogers v. Richmond, 365 U.S. 534, 541, 81 S.Ct. 735, 740, 5 L.Ed.2d 760:
43
'Indeed, in many of the cases in which the command of the Due Process Clause has compelled us to reverse state convictions involving the use of confessions obtained by impermissible methods, independent corroborating evidence left little doubt of the truth of what the defendant had confessed. Despite such verification, confessions were found to be the product of constitutionally impermissible methods in their inducement.'
44
Of course, we neither express nor suggest a view with regard to the ultimate guilt or innocence of the petitioner here; that is for a jury to decide on a new trial free of constitutional infirmity, which the State is at liberty to order.
45
This case illustrates a particular facet of police utilization of improper methods. While history amply shows that confessions have often been extorted to save law enforcement officials the trouble and effort of obtaining valid and independent evidence, the coercive devices used here were designed to obtain admissions which would incontrovertibly complete a case in which there had already been obtained, by proper investigative efforts, competent evidence sufficient to sustain a conviction. The procedures here are no less constitutionally impermissible, and perhaps more unwarranted because so unnecessary. There is no reasonable or rational basis for claiming that the oppressive and unfair methods utilized were in any way essential to the detection or solution of the crime or to the protection of the public. The claim, so often made in the context of coerced confession cases, that the devices employed by the authorities were requisite to solution of the crime and successful prosecution of the guilty party cannot here be made.
46
Official overzealousness of the type which vitiates the petitioner's conviction below has only deleterious effects. Here it has put the State to the substantial additional expense of prosecuting the case through the appellate courts and, now, will require even a greater expenditure in the event of retrial, as is likely. But it is the deprivation of the protected rights themselves which is fundamental and the most regrettable, not only because of the effect on the individual defendant, but because of the effect on our system of law and justice. Whether there is involved the brutal 'third degree,' or the more subtle, but no less offensive, methods here obtaining, official misconduct cannot but breed disrespect for law, as well as for those charged with its enforcement.
47
The judgment below is vacated and the case is remanded to the Supreme Court of Washington for further proceedings not inconsistent herewith. It is so ordered.
48
Judgment vacated and case remanded with directions.
49
Mr. Justice CLARK, with whom Mr. Justice HARLAN, Mr. Justice STEWART and Mr. Justice WHITE join, dissenting.
50
On December 19, 1957, at 9:05 p.m., a report was received by the Spokane Police Station that a filling station robbery was in progress in a certain area of the city. The report was broadcast to police cars working in the area. Twenty-five minutes later uniformed officers riding in a police car near the scene of the reported robbery observed petitioner walking down the street. As they approached him he went into the yard of a home in the vicinity. The police drove up and called to petitioner, who was questioned for a moment by one of the officers. Petitioner indicated that 'he lived there' and, after talking with the officers, walked onto the porch of the house and began fumbling with the screen door as if to unlock it. The officer remained at the curb observing petitioner, who in a few moments returned to the car and spontaneously exclaimed to the officers, 'You got me, let's go.' He was placed in the police car, admitted the robbery to the officers and, as they drove to the filling station, identified it as the place he had robbed. He was taken to the police station where he arrived within 20 minutes of his arrest and made a second oral confession to Lieutenant Wakeley, who was in charge of the detective office on the 4 o'clock to midnight shift. This confession was related by the lieutenant at the trial, without objection, in the following testimony:
51
'A. (By Lt. Wakeley.) He said they decided to hold up a place so they drove around to find some place that didn't seem to have any customers and they didn't know the streets, didn't know the town very well. They said they were out where they found the car. They drove by and saw a service station which didn't seem to have any business, so they parked the car in the alley and walked into the service station, and Raymond said that he told the man it was a holdup and his brother stood behind the man and he got the money from the service station operator. He didn't think his brother got any of it. After they held up the place they ran out the door and he ran down the side street, not directly toward the car, down around toward the end of the block and come (sic) back down the alley and as he was approaching the car he saw a police officer had his brother in custody. So he turned and ran north about two blocks and then turned and went west about three blocks before a prowl car came along and they stopped and talked to him and asked him where he was going. He said he was going home and he turned and walked up onto a porch. He stood on the porch and he said the prowl car sat out there in the street, didn't move, so he thought well, I might as well give up. So he went back and told them he was the man they were looking for.'
52
Thus within an hour and 20 minutes after his surrender petitioner had made two oral confessions—both admitted into evidence without objection—identical in relevant details to the written confession made the following day which the Court finds coerced. In light of the circumstances surrounding petitioner's arrest and confession, i believe the Court's reversal to be an abrupt departure from the rule laid down in the cases of this Court and an enlargement of the requirements heretofore visited upon state courts in confession cases. I therefore dissent.
53
The petitioner is neither youthful in age (though his exact age is not shown by the record) nor lacking in experience in law breaking. He is married and was a skilled sheet-metal worker temporarily unemployed. Some indication of his approximate age is given by the facts that his wife had been employed for some 14 years by the same employer, and that 11 years prior to the trial he had his first brush with the law, i.e., drunken driving, resisting arrest and being without a driver's license. Further, in 1949 he was convicted of breaking and entering, and in 1950 of robbery. During the same year he pleaded guilty to breaking jail and to 'taking a car.' He had not only served time but had been on parole for two years, making regular visits to parole officers to whom he was assigned. He cannot, therefore, be placed in the category of those types of people with whom the Court's cases in this area have ordinarily dealt, such as the mentally subnormal accused, Fikes v. Alabama, 352 U.S. 191, 77 S.Ct. 281, 1 L.Ed.2d 246 (1957); Payne v. Arkansas, 356 U.S. 560, 78 S.Ct. 844, 2 L.Ed.2d 975 (1958), and Reck v. Pate, 367 U.S, 433, 81 S.Ct. 1541, 6 L.Ed.2d 948 (1961); the youthful offender, such as Haley v. Ohio, 332 U.S. 595, 68 S.Ct. 302, 92 L.Ed. 224 (1948), and Gallegos v. Colorado, 370 U.S. 49, 82 S.Ct. 1209, 8 L.Ed.2d 325 (1962); or the naive and impressionable defendant, such as Lynumn v. Illinois, 372 U.S. 528, 83 S.Ct. 917, 9 L.Ed.2d 922 (1963). On the contrary, he is a mature adult who appears, from his testimony at the trial, to be of at least average intelligence and who is neither a stranger to police techniques and custodial procedures nor unaware of his rights on arrest. Thus the Court's reliance on Lynumn v. Illinois, supra,1 is completely misplaced.
54
I do not say that only the young, the weak and the mentally disturbed are susceptible to coercion, but only that these factors have ordinarily been involved in coerced confession cases and have been consistently regarded by the Court as important circumstances in the determination as to whether a confession was voluntarily made. Along with circumstances related to the petitioner, of course, the determination of coercion requires examination of the conduct of the police and the environment in which interrogation and confession occurred. We have long recognized that coercion need not be based upon the physical torture involved in Brown v. Mississippi, 297 U.S. 278, 56 S.Ct. 461, 80 L.Ed. 682 (1936). But here there is no contention by the petitioner either of physical abuse or of the more sophisticated techniques associated with police coercive practices. There was no extended or repeated interrogation,2 no deprivation of sleep or food,3 no use of psychiatric techniques.4 Further, there were no external circumstances such as threat of mob violence5 furnishing an atmosphere tending to subvert petitioner's rationality and free will.
55
I cannot condone the conduct of the police in holding the petitioner incommunicado, but of course we have no supervisory power over state courts. The question under the Fourteenth Amendment is whether the will of the accused is so overborne at the time of the confession that his statement is not 'the product of a rational intellect and a free will,' Reck v. Pate, supra, 367 U.S. at 440, 81 S.Ct. at 1546, and its determination 'is one on which we must make an independent determination on the undisputed facts.' Malinski v. New York, 324 U.S. 401, 404, 65 S.Ct. 781, 783, 89 L.Ed. 1029 (1945), citing Lisenba v. California, 314 U.S. 219, 62 S.Ct. 280, 86 L.Ed. 166 (1941), and Ashcraft v. Tennessee, 322 U.S. 143, 64 S.Ct. 921, 88 L.Ed. 1192 (1944). We have held that the fact that one has been denied consultation with an attorney, Cicenia v. Lagay, 357 U.S. 504, 78 S.Ct. 1297, 2 L.Ed.2d 1523 (1958), Crooker v. California, 357 U.S. 433, 78 S.Ct. 1287, 2 L.Ed.2d 1448 (1958), was not in itself controlling in such cases. Further, not even the fact that one is 'held incommunicado, is subjected to questioning by officers for long periods, and deprived of the advice of counsel,' without a showing that he had 'so lost his freedom of action' that the confession was not his own, requires a reversal under the Fourteenth Amendment. Lisenba v. California, supra, 314 U.S. at 240—241, 62 S.Ct. at 291—292. Finally, the fact that police officers violated state statutes in their treatment of the petitioner does 'not furnish an answer' to the question whether a confession was voluntarily made. Id., at 235, 62 S.Ct. at 289; see Gallegos v. Nebraska, 342 U.S. 55, 72 S.Ct. 141, 96 L.Ed. 86 (1951).
56
The Court's reversal here must be based upon the fact that, on the day after petitioner's arrest, when he signed the written confession at issue, he was told that after he made a statement and was booked he could call his wife. As to his testimony relating to the evening of his arrest, it is certainly disputed. Petitioner testified that he asked Detective Pike if he could call his wife, but Detective Pike testified that he did not even talk to petitioner. Lieutenant Wakeley testified unequivocally that petitioner made no such requests to him during their conversation, though he could not recall whether such requests were made 'at any time that night.'6
57
The Court concludes, then, that the police, by holding petitioner incommunicado and telling him that he could call his wife after he made a statement and was booked, wrung from him a confession he would not otherwise have made, a confession which was not the product of a free will. In Crooker v. California, supra, 357 U.S. at 436, 78 S.Ct. at 1290, however, we found no coercion or inducement, despite the fact that the petitioner's repeated requests for an attorney were denied and he 'was told that 'after (the) investigation was concluded he could call an attorney."
58
In light of petitioner's age, intelligence and experience with the police, in light of the comparative absence of any coercive circumstances, and in light of the fact that petitioner never, from the time of his arrest, evidenced a will to deny his guilt, I must conclude that his written confession was not involuntary. I find no support in any of the 33 cases decided on the question by this Court for a contrary conclusion. Therefore, I would affirm the judgment before us.
1
Haynes makes no claim that he was physically abused, deprived of food or rest, or subjected to uninterrupted questioning for prolonged periods.
2
The petitioner's brother, Keith Haynes, had been arrested a few minutes earlier. Though also charged with, and convicted of, participation in the robbery of the service station, he does not seek review of his conviction here.
3
Apparently recognizing the questionable nature of such a practice, the Spokane police, we are told, have since abandoned use of the 'small book' and the attendant restrictive practices.
4
The written confession appears to indicate on its face that it was signed shortly before 2 p.m. on December 20, about 16 1/4 hours after Haynes was arrested. The State asserts in its brief, however, that the total time of detention prior to signing of the confession was '17 to 19' hours. We assume, for purposes here, that the 16-hour period is sufficiently accurate.
5
Washington has since revised its rules of practice to provide for a preliminary hearing by the trial court, out of the presence of the jury, on the issue of voluntariness of a confession. See 58 Wash.2d, at 720, 364 P.2d, at 937, and Rules of Pleading, Practice and Procedure, Wash.Rev.Code, Rule 101.20W, Vol. O, as amended, effective January 2, 1961.
6
There is no indication that she was actually so notified. In fact, the petitioner's wife telephoned police at about noon on the day following the robbery, but was refused any information beyond the fact that her husband was being held. Though she identified herself and asked specifically why her husband was in jail, she was told simply 'to get the morning paper and read it.'
7
The petitioner's incommunicado detention was in contravention of an explicit Washington statute, Wash.Rev.Code, § 9.33.020(5), which prohibits and makes it a misdemeanor for police to 'refuse permission to (an) * * * arrested person to communicate with his friends or with an attorney' when the refusal has as its purpose the obtaining of a confession.
8
While occurring after completion of the signed confession here challenged, such action not only tends to bear out petitioner's version of what happened earlier but displays and confirms an official disregard by police of state law, see note 7, supra, and of the basic rights of the defendant. See Haley v. Ohio, 332 U.S. 596, 600, 68 S.Ct. 302, 304, 92 L.Ed. 224 (opinion of Mr. Justice Douglas). The police 'were rather concerned primarily with securing a statement from defendant on which they could convict him. The undeviating intent of the officers to extract a confession from petitioner is therefore patent. When such an intent is shown, this Court has held that the confession obtained must be examined with the most careful scrutiny * * *.' Spano v. New York, 360 U.S. 315, 324, 79 S.Ct. 1202, 1207, 3 L.Ed.2d 1265.
9
Though the deputy prosecutor himself appeared as a witness for the State at the trial, his testimony was in no way directed to this statement made in his office or the attendant circumstances and he was not recalled to the stand after Haynes testified so that he might controvert the petitioner's version of events.
10
See also Fikes v. Alabama, 352 U.S. 191, 197—198, 77 S.Ct. 281, 284—285, 1 L.Ed.2d 246; Gallagos v. Nebraska, 342 U.S. 55, 65, 72 S.Ct. 141, 147, 96 L.Ed. 86 (opinion of Mr. Justice Reed).
11
The trial court told the jury:
'And in this connection, I further instruct you that a confession or admission of a defendant is not rendered involuntary because he is not at the time of making the same reminded that he was under arrest, or that he was not obliged to reply, or that his answers would be used against him, or that he was entitled to be represented by counsel.'
That the jury was to take this as precluding consideration of the cited factors is evidenced by the immediately succeeding instruction which advised that it should consider a denial of communication with friends or an attorney in connection with determining whether the written confession was voluntary or not.
12
See note 10, supra.
13
The instruction commenced:
'By statute of the State of Washington, it is provided:
"The confession of a defendant made under inducement, with all the circumstances, may be given as evidence against him, except when made under the influence of fear produced by threats; but a confession made under inducement is not sufficient to warrant a conviction without corroborating testimony."
1
In Lynumn v. Illinois, 372 U.S. 528, 83 S.Ct. 917, 9 L.Ed.2d 922 (1963), the petitioner was a woman who 'had no previous experience with the criminal law, and had no reason not to believe that the police had ample power to carry out their threats.' Id., at 534, 83 S.Ct. at 920. She confessed after the police told her that if she did not cooperate she would be imprisoned for 10 years, her children would be taken away and she would be deprived of state aid for them.
2
See Spano v. New York, 360 U.S. 315, 79 S.Ct. 1202, 3 L.Ed.2d 1265 (1959); Ward v. Texas, 316 U.S. 547, 62 S.Ct. 1139, 86 L.Ed. 1663 (1942); Chambers v. Florida, 309 U.S. 227, 60 S.Ct. 472, 84 L.Ed. 716 (1940).
3
See Reck v. Pate, 367 U.S. 433, 81 S.Ct. 1541, 6 L.Ed.2d 948 (1961); Payne v. Arkansas, 356 U.S. 560, 78 S.Ct. 844, 2 L.Ed.2d 975 (1958).
4
See Leyra v. Denno, 347 U.S. 556, 74 S.Ct. 716, 98 L.Ed. 948 (1954); cf. Malinski v. New York, 324 U.S. 401, 65 S.Ct. 781, 89 L.Ed. 1029 (1945).
5
See Payne v. Arkansas, note 3, supra; Chambers v. Florida, note 2, supra.
6
Lieutenant Wakeley testified as follows:
'Q. Did Raymond Haynes at any time during that conversation (when he was interrogated) ask permission to make a telephone call to his wife? A. Not during the conversation.
'Q. Well, at any time that night? A. He might have asked afterward, after I got through talking to him. He wanted to know if his wife would be notified. I told him we would notify her that he was being held.
'Q. Did he ask permission to make a phone call himself to his wife? A. He may have. I don't remember exactly whether he asked or whether we wouldn't notify his wife.
'Q. Did he say anything to you, Lieutenant Wakeley, if you remember in substance that he wanted to call his wife so that she could get a lawyer? A. No, I don't remember that.'
| 01
|
373 U.S. 379
83 S.Ct. 1322
10 L.Ed.2d 428
Alexander T. SPERRY, Petitioner,v.STATE OF FLORIDA ex rel. THE FLORIDA BAR.
No. 322.
Argued March 25, 1963.
Decided May 27, 1963.
[Syllabus from pages 379-380 intentionally omitted]
Carlisle M. Moore, Mellin, Hanscom & Hursh, San Francisco, Cal., for petitioner.
F. Trowbridge vom Baur, Washington, D.C., for respondent.
[Amicus Curiae from pages 380-381 intentionally omitted]
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
Petitioner is a practitioner registered to practice before the United States Patent Office. He has not been admitted to practice law before the Florida or any other bar. Alleging, among other things, that petitioner 'is engaged in the unauthorized practice of law, in that although he is not a member of The Florida Bar, he nevertheless maintains an office * * * in Tampa, Florida, * * * holds himself out to the public as a Patent Attorney * * * represents Florida clients before the United States Patent Office, * * * has rendered opinions as to patentability, and * * * has prepared various legal instruments, including * * * applications and amendments to applications for letters patent, and filed same in the United States Patent Office in Washington, D.C.,' the Florida Bar instituted these proceedings in the Supreme Court of Florida to enjoin the performance of these and other specified acts within the State. Petitioner filed an answer in which he admitted the above allegations but pleaded as a defense 'that the work performed by him for Florida citizens is solely that work which is presented to the United States Patent Office and that he charges fees solely for his work of preparing and prosecuting patent applications and patent assignments and determinations incident to preparing and prosecuting patent applications and assignments.' Thereupon, the court granted the Bar's motion for a summary decree and permanently enjoined the petitioner from pursuing the following activities in Florida until and unless he became a member of the State Bar:
2
'1. using the term 'patent attorney' or holding himself out to be an attorney at law in this state in any field or phase of the law (we recognize that the respondent according to the record before us has already voluntarily ceased the use of the word 'attorney');
3
'2. rendering legal opinions, including opinions as to patentability or infringement on patent rights;
4
'3. preparing, drafting and construing legal documents;
5
'4. holding himself out, in this state, as qualified to prepare and prosecute applications for letters patent, and amendments thereto;
6
'5. preparation and prosecution of applications for letters patent, and amendments thereto, in this state; and
7
'6. otherwise engaging in the practice of law.'
8
The Supreme Court of Florida concluded that petitioner's conduct constituted the unauthorized practice of law which the State, acting under its police power, could properly prohibit, and that neither federal statute nor the Constitution of the United States empowered any federal body to authorize such conduct in Florida. 140 So.2d 587.
9
In his petition for certiorari, petitioner attacked the injunction 'only insofar as it prohibits him from engaging in the specific activities * * * (referred to above), covered by his federal license to practice before the Patent Office. He does not claim that he has any right otherwise to engage in activities that would be regarded as the practice of law.'1 We granted certiorari, 371 U.S. 875, 83 S.Ct. 148, 9 L.Ed.2d 113, to consider the significant, but narrow, questions thus presented.
10
We do not question the determination that under Florida law the preparation and prosecution of patent applications for others constitutes the practice of law. Greenough v. Tax Assessors, 333 U.S. 486, 67 S.Ct. 1400, 91 L.Ed. 1621; Murdock v. Memphis, 20 Wall. 590, 22 L.Ed. 429. Such conduct inevitably requires the practitioner to consider and advise his clients as to the patentability of their inventions under the statutory criteria, 35 U.S.C. §§ 101—103, 161, 171, as well as to consider the advisability of relying upon alternative forms of protection which may be available under statute law. It also involves his participation in the drafting of the specification and claims of the patent application, 35 U.S.C. § 112, which this Court long ago noted 'constitute(s) one of the most difficult legal instruments to draw with accuracy,' Topliff v. Topliff, 145 U.S. 156, 171, 12 S.Ct. 825, 831, 36 L.Ed. 658. And upon rejection of the application, the practitioner may also assist in the preparation of amendments, 37 CFR §§ 1.117—1.126, which frequently requires written argument to establish the patentability of the claimed invention under the applicable rules of law and in light of the prior art. 37 CFR § 1.119. Nor do we doubt that Florida has a substantial interest in regulating the practice of law within the State and that, in the absence of federal legislation, it could validly prohibit nonlawyers from engaging in this circumscribed form of patent practice.2
11
But 'the law of the State, though enacted in the exercise of powers not controverted, must yield' when incompatible with federal legislation. Gibbons v. Ogden, 9 Wheat. 1, 211, 6 L.Ed. 23. Congress has provided that the Commissioner of Patents 'may prescribe regulations governing the recognition and conduct of agents, attorneys, or other persons representing applicants or other parties before the Patent Office,' 35 U.S.C. § 31,3 and the Commissioner, pursuant to § 31, has provided by regulation that '(a)n applicant for patent * * * may be represented by an attorney or agent authorized to practice before the Patent Office in patent cases.' 37 CFR § 1.31. (Emphasis added.) The current regulations establish two separate registers 'on which are entered the names of all persons recognized as entitled to represent applicants before the Patent Office in the preparation and prosecution of applications for patent.' 37 CFR § 1.341. (Emphasis added.) One register is for attorneys at law, 37 CFR § 1.341(a), and the other is for nonlawyer 'agents.' 37 CFR § 1.341(b). A person may be admitted under either category only by establishing 'that he is of good moral character and of good repute and possessed of the legal and scientific and technical qualifications necessary to enable him to render applicants for patents valuable service, and is otherwise competent to advise and assist them in the presentation and prosecution of their applications before the Patent Office.' 37 CFR § 1.341(c).
12
The statute thus expressly permits the Commissioner to authorize practice before the Patent Office by non-lawyers, and the Commissioner has explicitly granted such authority. If the authorization is unqualified, then, by virtue of the Supremacy Clause, Florida may not deny to those failing to meet its own qualifications the right to perform the functions within the scope of the federal authority. A State may not enforce licensing requirements which, though valid in the absence of federal regulation, give 'the State's licensing board a virtual power of review over the federal determination' that a person or agency is qualified and entitled to perform certain functions,4 or which impose upon the performance of activity sanctioned by federal license additional conditions not contemplated by Congress.5 'No State law can hinder or obstruct the free use of a license granted under an act of Congress.' Pennsylvania v. Wheeling & Belmont Bridge Co., 13 How. 518, 566, 14 L.Ed. 249.
13
Respondent argues, however, that we must read into the authorization conferred by the federal statute and regulations the condition that such practice not be inconsistent with state law, thus leaving registered practitioners with the unqualified right to practice only in the physical presence of the Patent Office and in the District of Columbia, where the Office is now located.
14
The only language in either the statute or regulations which affords any plausible support for this view is the provision in the regulations that '(r) egistration in the Patent Office * * * shall only entitle the persons registered to practice before the Patent Office.' 37 CFR § 1.341. Respondent suggests that the meaning of this limitation is clarified by reference to the predecessor provision, which provided that registration 'shall not be construed as authorizing persons not members of the bar to practice law.' 3 Fed.Reg. 2429. Yet the progression to the more circumscribed language without more tends to indicate that the provision was intended only to emphasize that registration in the Patent Office does not authorize the general practice of patent law, but sanctions only the performance of those services which are reasonably necessary and incident to the preparation and prosecution of patent applications. That no more was intended is further shown by the contrast with the regulations governing practice before the Patent Office in trademark cases, also issued by the Commissioner of Patents. These regulations now provide that '(r)ecognition of any person under this section is not to be construed as sanctioning or authorizing the performance of any acts regarded in the jurisdiction where performed as the unauthorized practice of law.' 37 CFR § 2.12(d). The comparison is perhaps sufficiently telling. But any possible uncertainty as to the intended meaning of the Commissioner must be dispelled by the fact that when the present regulations were amended in 1948,6 it was first proposed to add a provision similar to that appearing in the trademark regulations.7 After objection had been leveled against the revision on the ground that it 'indicated that the office thinks that the states have the power to circumscribe and limit the rights of patent attorneys who are not lawyers,'8 the more sweeping language was deleted and the wording modified to its present form.
15
Bereft of support in the regulations, respondent directs us to the legislative history of the statute to confirm its understanding that § 31 and its predecessor provisions were not designed to authorize practice not condoned by the State. Insofar as this history provides any insight into the intent of Congress, however, we are convinced that the interpretation which respondent asks us to give the statute is inconsistent with the assumptions upon which Congress has acted for over a century.
16
Examination of the development of practice before the Patent Office and its governmental regulation reveals that: (1) nonlawyers have practiced before the Office from its inception, with the express approval of the Patent Office and to the knowledge of Congress; (2) during prolonged congressional study of unethical practices before the Patent Office, the right of nonlawyer agents to practice before the Office went unquestioned, and there was no suggestion that abuses might be curbed by state regulation; (3) despite protests of the bar, Congress in enacting the Administrative Procedure Act refused to limit the right to practice before the administrative agencies to lawyers; and (4) the Patent Office has defended the value of nonlawyer practitioners while taking steps to protect the interests which a State has in prohibiting unauthorized practice of law. We find implicit in this history congressional (and administrative) recognition that registration in the Patent Office confers a right to practice before the Office without regard to whether the State within which the practice is conducted would otherwise prohibit such conduct.
17
The power of the Commissioner of Patents to regulate practice before the Patent Office dates back to 1861, when Congress first provided that 'for gross misconduct he may refuse to recognize any person as a patent agent, either generally or in any particular case * * *.'9 The 'Rules and Directions' issued by the Commissioner in 1869 provided that '(a)ny person of intelligence and good moral character may appear as the attorney in fact or agent of an applicant upon filing proper power of attorney.'10 From the outset, a substantial number of those appearing in this capacity were engineers or chemists familiar with the technical subjects to which the patent application related. 'Many of them were not members of the bar. It probably never occurred to anybody that they should be.'11 Moreover, although a concentration of patent practitioners developed in Washington, D.C., the regulations have provided since the reorganization of the Patent Office in 1836 that personal attendance in Washington is unnecessary and that business with the Office should be transacted in writing.12 The bulk of practitioners are now scattered throughout the country, and have been so distributed for many years.13 As a practical matter, if practitioners were not so located, and thus could not easily consult with the inventors with whom they deal, their effectiveness would often be considerably impaired.14 Respondent's suggestion that practice by nonlawyers was intended to be confined to the District of Columbia thus assumes either congressional ignorance or disregard of long-established practice.
18
Despite the early recognition of nonlawyers by the Patent Office, these agents, not subject to the professional restraints of their lawyer brethren, were particularly responsible for the deceptive advertising and victimization of inventors which long plagued the Patent Office.15 To remedy these abuses, the Commissioner of Patents in 1899 first required registration of persons practicing before the Patent Office16 and, in 1918, required practitioners to obtain his prior approval of all advertising material which they distributed.17 It was to reach these same evils that § 31 was given much its present form when, in 1922, the statute was amended to expressly authorize the Commissioner to prescribe regulations for the recognition of agents and attorneys.18
19
This modification of the statute, first proposed in 1912, was designed to provide for the 'creation of a patent bar' and 'to require a higher standard of qualifications for registry.'19 Although it was brought to the attention of the House Committee on Patents that practitioners included lawyers and nonlawyers alike,20 it was never suggested that agents would be subject to exclusion. In fact, although the Commissioner of Patents had at one time expressed the view that Patent Office abuses could be eliminated only by restricting practice to lawyers,21 his successor concluded that such a limitation would be unwise and during the pendency of this legislation recommended to Congress against such a limitation:
20
'It has been suggested many times that the privilege of practising before the Office should be granted only after examination similar to examinations held for admission to the bar. It is believed that this requirement would be two severe, as many persons not specially trained in the law and without any particular educational advantages may by careful study of the practice and of the useful arts learn adequately to prosecute applications. Fundamentally knowledge of the invention is more important than knowledge of the rules and is often possessed by men of a type of mind which does not acquire legal knowledge readily.'22
21
Moreover, during the consideration in 1916 of another bill enacted to curb abusive advertising by patent practitioners, by prohibiting persons practicing before government agencies from using the names of government officials in their advertising literature,23 the same point was made on the floor of the House:
22
'Mr. OGLESBY. I will say to the gentleman that a good many men appear before the Patent Office who are not admitted attorneys. The commissioner stated at the hearing that he had considered the question as to whether or not anyone except a regularly admitted attorney at law should be excluded from practicing before the Patent Office, but for certain reasons thought, perhaps, he ought not to establish such a rule.'24
23
Disclosure that persons were falsely holding themselves out to be registered patent practitioners led in 1938 to the enactment of legislation making such misrepresentation a criminal offense.25 This corrective legislation was under consideration for over a decade and originally contained several other provisions, including one which would have prohibited any person 'duly registered to practice in the Patent Office * * * (from holding) himself out as a patent attorney, patent lawyer, patent solicitor, or patent counselor unless he is legally admitted to practice law in the State * * * or in the District of Columbia.'26 During the extended consideration given the matter in both Houses of Congress, the distinction between patent lawyers, who had been admitted to the bar, and nonlawyer agents, was repeatedly brought out;27 time and again it was made clear that the above provision was not intended to restrict practice by agents, but was designed only to prevent them from labeling themselves 'patent attorneys,'28 as the Patent Office had theretofore permitted.29 The proposed bills would not have affected 'any engineers or draftsmen from doing those things which they have always been doing before the Patent Office';30 the bills sought 'to bring about no change in the status of the many men now registered and entitled to practice before the Patent Office, regardless of whether they are members of the bar or not * * *.'31 (Emphasis added.) '(T)here are quite a number of solicitors of patents who are highly qualified and who are not members of the bar, who never graduated at law and were never admitted to the bar. But this bill doesn't disqualify those men. They can continue to qualify as patent agents.'32 (Emphasis added.) When asked '(w)hat is going to be the difference in the legal prerogatives of the agents and the others that come in,' the Commissioner of Patents responded that '(t)heir rights in the Patent Office will be exactly the same. Their rights in the courts will be different.'33 (Emphasis added.) The House debates on the bill before Congress in 1930 reveal the same understanding:
24
'Mr. STAFFORD. * * * I was under the impression that hereafter a person in order to practice before the Patent Office must be admitted to practice before some bar of a State.
25
'Mr. LaGUARDIA. That is my understanding.
26
'Mr. PERKINS. I will correct myself. He may be admitted to act as a patent agent, but after the passage of this act no one who is not admitted to the bar generally can hold himself out to be a patent attorney, patent lawyer, patent solicitor, or patent counselor.
27
'Mr. STAFFORD. A person without being a member of the bar may be registered as a patent agent to practice before the Commissioner of Patents?
28
'Mr. PERKINS. He may.'34
29
Hence, during the period the 1922 statute was being considered, and prior to its readoption in 1952,35 we find strong and unchallenged implications that registered agents have a right to practice before the Patent Office. The repeated efforts to assure Congress that no attempt was being made to limit this right are not without significance. Nor is it insignificant that we find no suggestion that the abuses being perpetrated by patent agents could or should be corrected by the States. To the contrary, reform was effected by the Patent Office, which now requires all practitioners to pass a rigorous examination 37 CFR § 1.341(c), strictly regulates their advertising, 37 CFR § 1.345, and demands that '(a)ttorneys and agents appearing before the Patent Office * * * conform to the standards of ethical and professional conduct generally applicable to attorneys before the courts of the United States.' 37 CFR § 1.344.
30
Moreover, the extent to which specialized lay practitioners should be allowed to practice before some 40-odd federal administrative agencies, including the Patent Office, received continuing attention both in and out of Congress during the period prior to 1952.36 The Attorney General's Committee on Administrative Procedure which, in 1941, studied the need for procedural reform in the administrative agencies, reported that '(e)specially among lawyers' organizations there has been manifest a sentiment in recent years that only members of the bar should be admitted to practice before administrative agencies. The Committee doubts that a sweeping interdiction of nonlawyer practitioners would be wise * * *.'37 Ultimately it was provided in § 6(a) of the Administrative Procedure Act that '(e)very party shall be accorded the right to appear in person or by or with counsel or other duly qualified representative in any agency proceeding. * * * Nothing herein shall be construed either to grant or to deny to any person who is not a lawyer the right to appear for or represent others before any agency or in any agency proceeding.' 60 Stat. 240, 5 U.S.C. § 1005(a). Although the act thus disavows any intention to change the existing practice before any of the agencies, so that the right of nonlawyers to practice before each agency must be determined by reference to the statute and regulations applicable to the particular agency, the history of § 6(a) contains further recognition of the power of agencies to admit nonlawyers, and again we see no suggestion that this power is in any way conditioned on the approval of the State. The Chairman of the American Bar Association's committee on administrative law testified before the House Judiciary Committee:
31
'A great deal of complaint has been received from two sources. Number one is the lay practitioners before the various agencies, chiefly the Interstate Commerce Commission, who are afraid something might be said that would oust them from practice. On the other hand, there is a great deal of protest from the committees on unauthorized practice of the law in various State, local, and municipal bar associations who are just as vehement in saying that these measures fail to recognize that legal procedure must be confined to lawyers. But these bills do not eliminate the lay practitioner, if the administrative agency feels they have a function to perform and desires to admit him to practice.'38
32
Despite the concern of the bar associations, the Senate Judiciary Committee reported that 'nonlawyers, if permitted by the agency to practice before it, are not excluded from representing interested parties in administrative matters.'39 And in the House debates on this provision we find the following instructive passage:
33
'Mr. AUSTIN. Mr. President, before the Senator leaves that thought, I wish to ask a question. I notice * * * in the section to which the Senator is referring, this language:
34
"Nothing herein shall be construed either to grant or to deny to any person who is not a lawyer the right to appear for or represent others before any agency or in any agency proceeding.'
35
'Is it not a fact that somewhere in the bill the distinguished Senator has reserved the right to a non-professional—that is, a man who is not a lawyer—to appear, if the agency having jurisdiction permits it? That is, there is a discretion permitted, is there not? For example, take a case where a scientific expert would better represent before the Commission the interests involved than would a lawyer. The right to obtain that privilege is granted in the bill somewhere, is it not?
36
'Mr. McCARRAN. The Senator is correct; and in connection with that I wish to read from the Attorney General's comment, as follows:
37
"This subsection does not deal with, or in any way qualify, the present power of an agency to regulate practice at its bar. It expressly provides, moreover, that nothing in the act shall be construed either to grant or to deny the right of nonlawyers to appear before agencies in a representative capacity. Control over this matter remains in the respective agencies.'
38
'That is the Attorney General's observation.'40 (Emphasis added.) It is also instructive to note that shortly after the adoption of the Administrative Procedure Act, the American Bar Association proposed the adoption of an 'Administrative Practitioners Act.'41 Though limiting the powers of nonattorneys in respects not here relevant, the bill did provide that 'authorized participation in agency proceedings' was permissible, without regard to whether the conduct constituted the practice of law in the State where performed.42
39
Indicative of this same general understanding, we note that every state court considering the problem prior to 1952 agreed that the authority to participate in administrative proceedings conferred by the Patent Office and by other federal agencies was either consistent with or pre-emptive of state law.43
40
Finally, regard to the underlying considerations renders it difficult to conclude that Congress would have permitted a State to prohibit patent agents from operating within its boundaries had it expressly directed its attention to the problem. The rights conferred by the issuance of letters patent are federal rights. It is upon Congress that the Constitution has bestowed the power 'To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries,' Art. I, § 8, cl. 8, and to take all steps necessary and proper to accomplish that end, Art. I, § 8, cl. 18, pursuant to which the Patent Office and its specialized bar have been established. The Government, appearing as amicus curiae, informs the Court that of the 7,544 persons registered to practice before the Patent Office in November 1962, 1,801 were not lawyers and, 1,687 others were not lawyers admitted to the bar of the State in which they were practicing.44 Hence, under the respondent's view, one-quarter of the present practitioners would be subject to disqualification or to relocation in the District of Columbia and another one-fourth, unless reciprocity provisions for admission to the bar of the State in which they are practicing are available to them, might be forced to relocate, apply for admission to the State's bar, or discontinue practice. The disruptive effect which this could have upon Patent Office proceedings cannot be ignored. On the other hand, the State is primarily concerned with protecting its citizens from unskilled and unethical practitioners,45 interests which, as we have seen, the Patent Office now safeguards by testing applicants for registration, and by insisting on the maintenance of high standards of integrity. Failure to comply with these standards may result in suspension or disbarment. 35 U.S.C. § 32; 37 CFR § 1.348. So successful have the efforts of the Patent Office been that the Office was able to inform the Hoover Commission that 'there is no significant difference between lawyers and nonlawyers either with respect to their ability to handle the work or with respect to their ethical conduct.'46
41
Moreover, since patent practitioners are authorized to practice only before the Patent Office, the State maintains control over the practice of law within its borders except to the limited extent necessary for the accomplishment of the federal objectives.47
42
We have not overlooked respondent's constitutional arguments, but find them singularly without merit. We have already noted the source of Congress' power to grant patent rights. It has never been doubted that the establishment of the Patent Office to process patent applications is appropriate and plainly adapted to the end of securing to inventors the exclusive right to their discoveries, nor can it plausibly be suggested that by taking steps to authorize competent persons to assist in the preparation of patent applications Congress has exceeded the bounds of what is necessary and proper to the accomplishment of this same end. Cf. Goldsmith v. United States Board of Tax Appeals, 270 U.S. 117, 46 S.Ct. 215, 70 L.Ed. 494; United States ex rel. Bernardin v. Duell, 172 U.S. 576, 19 S.Ct. 286, 43 L.Ed. 559. Congress having acted within the scope of the powers 'delegated to the United States by the Constitution,' it has not exceeded the limits of the Tenth Amendment despite the concurrent effects of its legislation upon a matter otherwise within the control of the State. 'Interference with the power of the States was no constitutional criterion of the power of Congress. If the power was not given, Congress could not exercise it; if given, they might exercise it, although it should interfere with the laws, or even the Constitution of the States.' II Annals of Congress 1897 (remarks of Madison). The Tenth Amendment 'states but a truism that all is retained which has not been surrendered.' United States v. Darby, 312 U.S. 100, 124, 61 S.Ct. 451, 462, 85 L.Ed. 609; Case v. Bowles, 327 U.S. 92, 102, 66 S.Ct. 438, 443, 90 L.Ed. 552. Compare Leslie Miller, Inc. v. Arkansas, 352 U.S. 187, 77 S.Ct. 257, 1 L.Ed.2d 231. The authority of Congress is no less when the state power which it displaces would otherwise have been exercised by the state judiciary rather than by the state legislature. Cf. Pennsylvania R. Co. v. Public Service Comm., 250 U.S. 566, 40 S.Ct. 36, 64 L.Ed. 1142. Finally, § 31 contains sufficient standards to guide the Patent Office in its admissions policy to avoid the criticism that Congress has improperly delegated its powers to the administrative agency. Fahey v. Mallonee, 332 U.S. 245, 67 S.Ct. 1552, 91 L.Ed. 2030; Currin v. Wallace, 306 U.S. 1, 16—18, 59 S.Ct. 379, 387—388, 83 L.Ed. 441.
43
It follows that the order enjoining petitioner must be vacated since it prohibits him from performing tasks which are incident to the preparation and prosecution of patent applications before the Patent Office. The judgment below is vacated and the case is remanded for further proceedings not inconsistent with this opinion. It is so ordered.
44
Judgment vacated and case remanded.
1
Petitioner's right to refer to himself as a 'Patent Attorney' has been mooted by his voluntary discontinuance of the use of the term 'attorney.'
2
See Konigsberg v. State Bar of California, 366 U.S. 36, 40 41, 81 S.Ct. 997, 1001—1002, 6 L.Ed.2d 105; Schware v. Board of Bar Examiners of New Mexico, 353 U.S. 232, 239, 77 S.Ct. 752, 756, 1 L.Ed.2d 796; West Virginia State Bar v. Earley, 144 W.Va. 504, 109 S.E.2d 420; Gardner v. Conway, 234 Minn. 468, 48 N.W.2d 788.
3
Act of July 19, 1952, c. 950, § 1, 66 Stat. 795, 35 U.S.C. § 31:
'The Commissioner, subject to the approval of the Secretary of Commerce, may prescribe regulations governing the recognition and conduct of agents, attorneys, or other persons representing applicants or other parties before the Patent Office, and may require them, before being recognized as representatives of applicants or other persons, to show that they are of good moral character and reputation and are possessed of the necessary qualifications to render to applicants or other persons valuable service, advice, and assistance in the presentation or prosecution of their applications or other business before the Office.'
4
Leslie Miller, Inc. v. Arkansas, 352 U.S. 187, 190, 77 S.Ct. 257, 259, 1 L.Ed.2d 231; First Iowa Hydro-Electric Coop. v. Federal Power Comm., 328 U.S. 152, 66 S.Ct. 906, 90 L.Ed. 1143; cf. Castle v. Hayes Freight Lines, Inc., 348 U.S. 61, 75 S.Ct. 191, 99 L.Ed. 68; Cloverleaf Butter Co. v. Patterson, 315 U.S. 148, 62 S.Ct. 491, 86 L.Ed. 754.
5
Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 235—236, 67 S.Ct. 1146, 1154—1155, 91 L.Ed. 1447; Moran v. New Orleans, 112 U.S. 69, 5 S.Ct. 38, 28 L.Ed. 653; Sinnot v. Davenport, 22 How. 227, 16 L.Ed. 243; Gibbons v. Ogden, 9 Wheat. 1, 6 L.Ed. 23; Huron Portland Cement Co. v. Detroit, 362 U.S. 440, 449, 80 S.Ct. 813, 819, 4 L.Ed.2d 852 (dissenting opinion); cf. Hill v. Florida, 325 U.S. 538, 65 S.Ct. 1373, 89 L.Ed. 1782.
6
13 Fed.Reg. 9596.
7
Proposed Revision of Patent Rules § 5.1, 611 O.G.Pat.Off., June 29, 1948, Supp. 8:
'Registration of attorneys and agents. * * * Registration in the Patent Office under the provisions of these rules shall not be construed as authorizing persons not members of the bar to practice law or to perform any acts regarded as practicing law in the jurisdiction where performed.'
8
'I think I know what you mean to say, but you have not said what you mean to say. If you stopped at the end of the first clause there and said that it does not authorize the persons not members of the bar to practice law, you might be closer to being right; but, as you have written it here, you have said that patent attorneys may not do in the states things which it may be necessary for them to do in order to prosecute their claims before the Patent Office.
'In order words, you are giving it to the states to say what a patent attorney may do rather than leaving it up to the Congress and to the laws of the United States.
'I may suggest that what patent attorneys do before the Patent Office might be construed as practicing law, were it not for the fact that their particular conduct is permitted by the acts of Congress and under the rules of the Patent Office.
'The states cannot pass laws derogating from the rights of the patent attorneys as created by Congress and existing under the rules of the Patent Office. I think that the rule, as proposed, makes it possible for the states, or indicated that the Office thinks that the states have the power to circumscribe and limit the rights of patent attorneys who are not lawyers, which rights are created under the laws of Congress, and subject to the rules of the Patent Office rather than to regulation by the individual states.
'I think you would have no power to pass this particular part of your proposed rule.'
Remarks of A. P. Kane, Attorney, Hearing on Proposed Revision of Rules of Practice in Patent Cases, 281—282 (Sept. 30, 1948). See also id., at pp. 319—330.
9
Act of March 2, 1861, c. 88, § 8, 12 Stat. 247; see also Act of July 8, 1870, c. 230, § 19, 16 Stat. 200, as amended, 66 Stat. 793, 35 U.S.C. § 6.
10
Rules and Directions for Proceedings in the Patent Office, § 127 (Aug. 1, 1869).
11
Letter from Edward S. Rogers, Hearings before House Committee on Patents on H.R. 5527, 70th Cong., 1st Sess. 84 (1928); cf. Hoosier Drill Co. v. Ingels, 15 O.G.Pat.Off. 1013; 2 Robinson, Patents § 431.
12
'Personal attendance of the applicant at the Patent Office, to obtain a patent, is unnecessary. The business can be done by correspondence, (free of postage) or by power of attorney.' Information to Persons Having Business to Transact at the Patent Office, 8 (July 1836). In 1854, it was first provided that '(a)ll business with the office should be transacted in writing. * * *' Rules and Directions for Proceedings in the Patent Office, § 122 (Feb. 20, 1854). Compare 37 CFR § 1.2.
13
Roster of Attorneys and Agents Registered to Practice Before the U.S. Patent Office (1958); Names and Addresses of Attorneys Practicing Before the U.S. Patent Office (1883); Testimony of T. E. Robertson, Commissioner of Patents, Hearings before House Committee on Patents on H.R. 699, 71st Cong., 2d Sess. 12. Commencing in 1848, the Commissioner for many years informed inventors that '(i)f the services of Patent Agents are desired, able and competent persons engaged in that business can be found at their offices in this city, and in other cities.' Information to Persons Having Business to Transact at the Patent Office, Patent Agents or Attorneys (1848). (Emphasis deleted and added.)
14
See Berle, Inventions and Their Management, 189—190; Hoar, Patent Tactics and Law (3d ed.), 256—257; Woodling, Inventions and Their Protection (2d ed.), 289—290, 333; Rivise, Preparation and Prosecution of Patent Applications, § 42.
15
See Hearings before House Committee on Patents on H.R. 5527, 70th Cong., 1st Sess. 16—18; 69 Cong.Rec. 6580; Spencer, The United States Patent Law System, 94—96. Berle, 184—186. Compare H.R.Rep. No. 1622, 68th Cong., 2d Sess. 2—3; H.R.Rep. No. 364, 64th Cong., 1st Sess. 2; Information to Persons Having Business to Transact at the Patent Office, Patent Agents or Attorneys (1848).
16
Rules of Practice in the United States Patent Office, § 17 (July 18, 1899). Compare § 17 in the edition of June 18, 1897.
17
252 O.G.Pat.Off. 967. Compare 37 CFR § 1.345.
18
Act of February 18, 1922, c. 58, § 3, 42 Stat. 390. Compare Act of July 8, 1870, c. 230, § 19, 16 Stat. 200, as amended, 35 U.S.C. § 6, and Act of July 4, 1884, c. 181, § 5, 23 Stat. 101, 5 U.S.C. § 493.
19
Letter from E. B. Moore, Commissioner of Petents, Hearings before House Committee on Patents on H.R. 23417, No. 1, 62d Cong., 2d Sess. 6—7. See also Hearings before House Committee on Patents on H.R. 210, 67th Cong., 1st Sess. 16; Commissioner of Patents, Annual Report, xii (1908).
20
The following colloquy regarding an identical bill introduced the session before passage occurred between Congressman Himes and the Commissioner of Patents:
'Mr. HIMES. It seems to me that we should know just who the man practicing before the Patent Office happens to be. Must he be a member of the bar or are the requirements the same for the patent attorney who simply goes and gets a patent for his clients as the man that goes and practices before the Patent Office, before the Commissioner of Patents?
'Mr. ROBERTSON. The Patent Office can register anyone who shows a degree of proficiency necessary to write specifications, whether or not he is a member of the bar.
'Mr. HIMES. He must not be a member of the bar?
'Mr. ROBERTSON. He need not be a member of the bar. That is not as bad as it sounds. Some of our best practitioners are not members of the bar. They are the older line of attorneys. There are some very fine ones who have been practicing before the Patent Office 30 or 40 years who are not members of the bar, but they are honest men, and there are some of the practitioners who are members of the bar who are not honest men. So it is a very difficult thing to reach.' Hearings before House Committee on Patents on H.R. 210, 67th Cong., 1st Sess. 15—16.
See also Hearings before House Committee on Patents on H.R. 5011, 5012, 7010, 66th Cong., 1st Sess. 281.
21
Commissioner of Patents, Annual Report, vi (1893).
22
Commissioner of Patents, Annual Report, xiv (1915).
23
Act of April 27, 1916, c. 89, 39 Stat. 54.
24
53 Cong.Rec. 6313.
25
Act of May 9, 1938, 52 Stat. 342; now 66 Stat. 796, 35 U.S.C. § 33.
26
This was the so-called 'Cramton bill,' H.R. 699, 71st Cong., 2d Sess.; H.R. 5527, 70th Cong.,, 1st Sess.; H.R. 5811, 69th Cong., 1st Sess.; H.R. 10735, 69th Cong., 1st Sess.; H.R. 5790, 68th Cong., 1st Sess.
27
E.g., 69 Cong.Rec. 6580; Hearings before Senate Committee on Patents on H.R. 5527, 70th Cong., 1st Sess. 4—7, 51; Hearings before House Committee on Patents on H.R. 699, 71st Cong., 2d Sess. 34, 49.
28
E.g., 69 Cong.Rec. 6580; S.Rep. No. 628, 71st Cong., 1st Sess. 4; Hearings before Senate Committee on Patents on H.R. 5527, 70th Cong., 1st Sess. 7, 59; Hearings before House Committee on Petents on H.R. 5527, 70th Cong., 1st Sess. 14—25, 28—33, 56—76, 85—100; Hearings before Senate Committee on Patents on H.R. 699, 71st Cong., 2d Sess. 3, 5, 10; Hearings before House Committee on Patents on H.R. 699, 71st Cong., 2d Sess. 2—5, 41.
29
Prior to 1938, the Patent Office listed both lawyers and nonlawyers on a single register and referred to both as Patent Attorneys. The legislation which was proposed would not have prohibited nonlawyers previously registered from continuing to use this appellation. E.g., H.R.Rep. No. 947, 70th Cong., 1st Sess. 4. Although the several bills containing this provision failed to gain approval (though passing the House repeatedly), in 1938, the Commissioner, following suggestions made to him during the course of the Committee hearings, Hearings before House Committee on Patents on H.R. 5811, 69th Cong., 1st Sess. 46; Hearings before House Committee on Patents on H.R. 5527, 70th Cong., 1st Sess. 20, 26—27, established separate registers for lawyers and for nonlawyer agents, 495 O.G.Pat.Off. 715, and has since prohibited agents so registered from representing themselves to be attorneys, solicitors or lawyers. See 37 CFR §§ 1.341, 1.345. The registration of those agents previously enrolled on the single register, of whom petitioner is one, was not changed.
30
S.Rep. No. 1209, 70th Cong., 1st Sess. 1.
31
H.R.Rep. No. 947, 70th Cong., 1st Sess. 4; S.Rep. No. 626, 71st Cong., 2d Sess. 4; H.R.Rep. No. 728, 71st Cong., 2d Sess. 3.
32
Statement of E. W. Bradford, Chairman of the Committee on Ethics of the American Patent Law Association, Hearings before House Committee on Patents on H.R. 699, 71st Cong., 2d Sess. 61.
33
Hearings before House Committee on Patents on H.R. 5527, 70th Cong., 1st Sess. 15.
34
72 Cong.Rec. 5467.
35
No changes of substance were intended by the 1952 revision. S.Rep. No. 1979, 82d Cong., 2d Sess. 4; H.R.Rep. No. 1923, 82d Cong., 2d Sess. 6, U.S.Code Congressional and Administrative News 1952, p. 2394.
36
See Committee on Administrative Practice of the Bar Association of the District of Columbia, Report on Admission to and Control Over Practice Before Federal Administrative Agencies (1938); Survey of the Legal Profession, Standards of Admission for Practice Before Federal Administrative Agencies (1953); House Committee on Government Operations, Survey and Study of Administrative Organization, Procedure, and Practice in the Federal Agencies, 85th Cong., 1st Sess. (Comm.Print); Note, Proposed Restriction of Lay Practice Before Federal Administrative Agencies, 48 Col,. L.Rev. 120.
37
Attorney General's Committee on Administrative Procedure, Final Report, 124 (1941). Compare Commission on Organization of the Executive Branch of the Government, Report to the Congress on Legal Services and Procedure, 32—35, 40—44 (1955).
38
Hearings before House Committee on the Judiciary on Federal Administrative Procedure, 79th Cong., 1st Sess. (Serial No. 19) 33—34, Legislative History of the Administrative Procedure Act, S.Doc. No. 248, 79th Cong., 2d Sess. 79—80 (hereinafter referred to as 'Legislative History').
39
S.Comm.Print on S. 7, 79th Cong., 1st Sess. 10 (June 1945), Legislative History 26.
40
92 Cong.Rec. 2156, Legislative History 316—317.
41
H.R. 2657, 80th Cong., 1st Sess. See Curry, Bills in Congress Sponsored by American Bar Association Seek to Prevent Nonlawyers From Practicing Before the Interstate Commerce Commission, 14 I.C.C.Pract.J. 491.
42
'Credentials for Agents
'SEC. 6. If any agency shall find it necessary in the public interest and in the interest of parties to agency proceedings before it to authorize practice by individuals not subject to section 5 and provides by generally applicable rule therefor in any case in which the governing statute does not provide only for appearances in person or by attorney or counsel, any such individual may be admitted hereunder to practice as an agent before such agency except in proceedings pursuant to section 7 or 8 of the Admintrative Procedure Act or in connection with any form of compulsory process. * * * On application, individuals subject to this section who have been individually authorized to practice before any agency, have maintained such standing, are actively engaged in practice so permitted, and are so certified by the agency with a specification of the extent to which they have been so qualified to practice and have practiced shall be given credentials enabling them to continue such practice. No agency, and nothing in this Act, shall be deemed to permit any person to practice law in any place or render service save the authorized participation in agency proceedings by holders of credentials; and no person shall hold himself out, impliedly or expressly, as otherwise authorized hereunder.'
43
Chicago Bar Ass'n v. Kellogg, 338 Ill.App. 618, 88 N.E.2d 519 (1949) (Patent Office); Sharp v. Mida's Research Bureau, Sup., 45 N.Y.S.2d 690 (1943), aff'd, 267 App.Div. 980, 48 N.Y.S.2d 799 (1944) (Patent Office); Schroeder v. Wheeler, 126 Cal.App. 367, 14 P.2d 903 (1932) (Patent Office); People ex rel. Colorado Bar Ass'n v. Erbaugh, 42 Colo. 480, 94 P. 349 (1908) (Patent Office) (by implication); In re New York County Lawyers Ass'n (In re Bercu), 273 App.Div. 524, 534—535, 78 N.Y.S.2d 209, 218 (1948), aff'd, 299 N.Y. 728, 87 N.E.2d 451 (1949) (Treasury and Tex Court) (by implication); Auerbacher v. Wood, 139 N.J.Eq. 599, 604, 53 A.2d 800, 803 (1947), aff'd, 142 N.J.Eq. 484, 59 A.2d 863 (1948) (N.L.R.B.); De Pass v. B. Harris Wool Co., 346 Mo. 1038, 144 S.W.2d 146 (1940) (I.C.C.); Blair v. Motor Carriers Service Bureau, Inc., 40 Pa.Dist. & Co.R. 413, 426 (1939) (I.C.C.); Bennett v. Goldsmith, 280 N.Y. 529, 19 N.E.2d 927 (1939) (Immigration Department); Public Service Traffic Bureau, Inc. v. Haworth Marble Co., 40 Ohio App. 255, 178 N.E. 703 (1931) (I.C.C.) (dictum); In re Gibbs, 35 Ariz. 346, 355, 278 P. 371, 374 (1929) (Land Office) (dictum); Mulligan v. Smith, 32 Colo. 404, 76 P. 1063 (1904) (Land Office); see also In re Lyon, 301 Mass. 30, 16 N.E.2d 74 (1938) (bankruptcy); Brooks v. Mandel-Witte Co., 54 F.2d 992 (C.A.2d Cir.), cert. denied, 286 U.S. 559, 52 S.Ct. 641, 76 L.Ed. 1292 (1932) (Customs Court). Compare Lowell Bar Ass'n v. Loeb, 315 Mass. 176, 184—185, 52 N.E.2d 27, 33—34 (1943) (Treasury and Tax Court).
Normally, the state courts have deemed the authority granted by the federal agency to be closely circumscribed. E.g., Chicago Bar Ass'n v. Kellogg, supra; In re Lyon, supra; Public Service Traffic Bureau, Inc. v. Haworth Marble Co., supra.
In recent years divergence in opinion has developed. Compare Battelle Memorial Inst. v. Green, 133 U.S.P.Q. 49 (Ohio Ct.App.1962) (Patent Office), and Noble v. Hunt, 95 Ga.App. 804, 99 S.E.2d 345 (1957) (Treasury and Tex Court), with Agran v. Shapiro, 127 Cal.App.2d Supp. 807, 273 P.2d 619 (App.Dept.Super.Ct., 1954) (Treasury); Wisconsin v. Keller, 16 Wis.2d 377, 114 N.W.2d 796, now pending on certiorari as No. 429, 1962 Term (I.C.C.); Petition of Kearney, 63 So.2d 630 (Fla.1953) (Treasury and Tax Court); cf. Marshall v. New Inventor's Club, Inc., 117 N.E.2d 737 (Ohio Com.Pl.1953) (Patent Office).
State courts have frequently held practice before state administrative agencies by nonlawyers to constitute the unauthorized practice of law. E.g., People ex rel. Chicago Bar Ass'n v. Goodman, 366 Ill. 346, 8 N.E.2d 941, 111 A.L.R. 1, cert. denied, 302 U.S. 728, 58 S.Ct. 49, 82 L.Ed. 562; Clark v. Austin, 340 Mo. 467, 101 S.W.2d 977. But compare State ex rel. Reynolds v. Dinger, 14 Wis.2d 193, 109 N.W.2d 685; Realty Appraisals Co. v. Astor-Broadway Holding Corp., 5 A.D.2d 36, 169 N.Y.S.2d 121.
44
Of the 73 patent practitioners in Florida, 62 are not members of the Florida Bar.
45
Hexter Title & Abstract Co. v. Grievance Committee, 142 Tex. 506, 509, 179 S.W.2d 946, 948, 157 A.L.R. 268; Lowell Bar Ass'n v. Loeb, 315 Mass. 176, 180, 52 N.E.2d 27, 31. Commission on Organization of the Executive Branch of the Government, Report of the Task Force on Legal Services and Procedure, Part VI, Appendices and Charts, 169 (1955).
46
Id., 158. The Patent Office noted the qualification that nonlawyers are able to advertise. Compare Hearings before House Committee on Patents on H.R. 5527, 70th Cong., 1st Sess. 16—19, 71 72, 89, 90.
47
Because of the breadth of the injunction issued in this case, we are not called upon to determine what functions are reasonably within the scope of the practice authorized by the Patent Office. The Commissioner has issued no regulations touching upon this point. We note, however, that a practitioner authorized to prepare patent applications must of course render opinions as to the patentability of the inventions brought to him, and that it is entirely reasonable for a practitioner to hold himself out as qualified to perform his specialized work, so long as he does not misrepresent the scope of his license.
| 56
|
373 U.S. 487
83 S.Ct. 1356
10 L.Ed.2d 501
Alvin R. CAMPBELL et al., Petitioners,v.UNITED STATES.
No. 631.
Argued April 25, 1963.
Decided May 27, 1963.
Melvin S. Louison, Taunton, Mass., and Lawrence F. O'Donnell, Boston, Mass., for petitioners.
Archibald Cox, Sol. Gen., for respondent.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
This case, involving questions under the so-called Jencks Act, 18 U.S.C. § 3500,1 is before the Court for the second time. When it was first here, we held inadequate the procedure employed by the trial court for ascertaining whether notes taken by Federal Agent John F. Toomey, Jr., at his interview with Dominic Staula—a key government witness at petitioners' trial for bank robbery—or the Interview Report compiled by Toomey from his notes, were producible statements within the meaning of § 3500(e)(1) or (e)(2). 365 U.S. 85, 81 S.Ct. 421, 5 L.Ed.2d 428.2 We declined to order petitioners' convictions vacated, but remanded 'to the trial court with direction to hold a new inquiry consistent with this opinion * * * (and) supplement the record with new findings * * *.' 365 U.S., at 98—99, 81 S.Ct., at 428, 5 L.Ed.2d 428. On remand the trial judge held a hearing at which Toomey but not Staula testified. Toomey gave the following testimony: On the day following the robbery he interviewed Staula privately. Staula was a depositor of the bank and had been an eyewitness to the crime. Toomey took longhand notes of the interview, which were 'complete * * * with respect to the pertinent information' given by Staula, although not a complete, word-for-word transcription of what he had said. Toomey then recited back to Staula the substance of his account, referring to his notes, and Staula said that Toomey had got it straight. Staula did not read or sign the notes. About seven hours later Toomey, after rearranging his notes to accord with the chronology of Staula's account, dictated the Interview Report, relying primarily on his notes but also on memory. After checking the transcribed report against the notes and finding it accurate, he destroyed the notes.3
2
On the basis of this testimony and the record of Staula's testimony at petitioners' trial, the trial judge held that neither the notes nor the Interview Report was producible under the Jencks Act. 206 F.Supp. 213. On appeal, the Court of Appeals expressed dissatisfaction with the judge's conduct of the hearing but accepted his ruling that the Interview Report was not producible. 9 Cir., 296 F.2d 527. However, the court held that the status of the notes could not be adequately determined without fresh testimony from Staula.4 Accordingly the court, while retaining jurisdiction of the appeal generally, ordered a further hearing before a district judge other than the trial judge, with both Staula and Toomey to testify, for a determination 'whether Staula signed or otherwise adopted or approved the notes.' Id., 296 F.2d, at 534.
3
At this hearing Staula testified that he had not read or signed Toomey's notes but had told Toomey that what the latter had repeated back to him was, to the best of his knowledge, what had happened. Toomey amplified his earlier testimony. On this record the second district judge concluded, 199 F.Supp. 905, that Toomey's oral presentation to Staula had 'not merely adhered to the substance (of the notes) but so far as practical to the precise words,' id., 199 F.Supp., at 906; that Staula had adopted this presentation; that the Interview Report was 'almost in ipsissima verba the narrative (Toomey) had just checked with Staula,' id., 199 F.Supp., at 907; and that therefore the report was producible as 'a written statement made by said witness and * * * adopted * * * by him.' 18 U.S.C. § 3500(e)(1).
4
The Court of Appeals then filed a supplemental opinion in which it accepted the second district judge's findings but held that the report was neither a written statement approved by Staula nor a copy of such a statement, and hence did not come within § 3500(e)(1). 303 F.2d 747. We granted certiorari and leave to proceed in forma pauperis. 371 U.S. 919, 83 S.Ct. 295, 9 L.Ed.2d 229. We reverse. We agree with the second district judge that the Interview Report was producible under § 3500(e)(1); consequently, we do not reach the other issues tendered by petitioners.5
5
In Campbell I, we posed the following questions to frame the hearing on remand:
6
'Did Toomey write down what Staula told him at the interview? If so, did Toomey give Staula the paper 'to read over, to make sure that it was right,' (as Staula had testified at the trial) and did Staula sign it?
7
'Was the Interview Report the paper Staula described or a copy of that paper? In either case, as the trial judge ruled, the Interview Report would be a producible 'statement' under subsection (e)(1).' 365 U.S., at 93, 81 S.Ct., at 426, 5 L.Ed.2d 428.
8
We now know that the 'paper Staula described' was Toomey's interview notes, and that Staula adopted Toomey's oral presentation based on the notes. Plainly, if Toomey in making the oral presentation was in fact reading the notes back to Staula, the latter's adoption of the oral presentation would constitute adoption of a written statement made by him, namely, the notes. See United States v. Annunziato, 293 F.2d 373, 382 (C.A.2d Cir., 1961); United States v. Aviles, 197 F.Supp. 536, 556 (D.C.S.D.N.Y.1961).6 The producibility of the Interview Report under § 3500(e)(1) would therefore seem to depend upon the answers to two questions: whether Toomey's oral version of the notes may fairly be deemed a reading back of the notes to Staula; and whether the Interview Report may fairly be deemed a copy of the notes.
9
We think these questions properly are ones of fact, the determination of which by the district judge may not be disturbed unless clearly erroneous. 'Final decision as to production must rest, as it does so very often in procedural and evidentiary matters, within the good sense and experience of the district judge guided by the standards we have outlined, and subject to the appropriately limited review of appellate courts.' Palermo v. United States, 360 U.S. 343, 353, 79 S.Ct. 1217, 1225, 3 L.Ed.2d 1287. Cf. id., 360 U.S., at 360, 79 S.Ct., at 1228—1229, 3 L.Ed.2d 1287 (concurring opinion); Hance v. United States, 299 F.2d 389, 397 (C.A.8th Cir., 1962); United States v. Thomas, 282 F.2d 191 (C.A.2d Cir., 1960). 'The inquiry (is) a proceeding necessary to aid the judge to discharge the responsibility laid upon him to enforce the statute. * * * The statute * * * implies the duty in the trial judge affirmatively to administer the statute in such way as can best secure relevant and available evidence * * *.' 365 U.S., at 95, 81 S.Ct., at 427, 5 L.Ed.2d 428. To determine the accuracy with which Toomey's oral presentation and Interview Report reproduced his notes was preeminently a task for a nisi prius, not an appellate, court. It required the ad hoc appraisal of one of the 'myriad' 'possible permutations of fact and circumstance', Palermo v. United States, supra, 360 U.S., at 353, 79 S.Ct., at 1225, 3 L.Ed.2d 1287, present in such cases; it may well have depended upon nuances of testimony and demeanor of witnesses; and it concerned a subject, rulings on evidence, which is peculiarly the province of trial courts.7
10
For the purpose of applying the clearly-erroneous standard in the instant case, we deem controlling the findings of the second district judge. As the Court of Appeals correctly held, the first hearing did not conform to our mandate in Campbell I because Staula was not called to testify; and the hearing was unsatisfactory in other respects.8 Moreover, while Toomey's testimony at the second hearing did not contradict his earlier testimony, it was considerably more detailed. Also, we perceive no basic inconsistency between the factfindings made at the first hearing and those made at the second, although the later findings were more elaborate.9 Finally, we read the supplemental opinion of the Court of Appeals as having accepted the later findings as controlling and based its decision upon them.
11
In so doing, the Court of Appeals implicitly concluded that the later findings were not clearly erroneous. That conclusion was surely sound. Although there may well be small differences as among the notes, oral presentation, and Interview Report, it is not seriously suggested that there was a material variance or inconsistency among them.10 And the district judge was entitled to infer that an agent of the Federal Bureau of Investigation of some 15 years' experience would record a potential witness' statement with sufficient accuracy as to obviate any need for the courts to consider whether it would be 'grossly unfair to allow the defense to use statements to impeach a witness which could not fairly be said to be the witness' own.' Palermo v. United States, supra, 360 U.S., at 350, 79 S.Ct., at 1223, 3 L.Ed.2d 1287. We cannot say, therefore, that the second district judge's finding that the Interview Report was a copy of a written statement made and adopted by Staula was clearly erroneous.11
12
Our holding today only gives effect to the 'command of the statute (which) is * * * designed to further the fair and just administration of criminal justice * * *.' Campbell I, 365 U.S., at 92, 81 S.Ct., at 425, 5 L.Ed.2d 428.12 Petitioners—Alvin R. Campbell and Arnold S. Campbell, brothers, and Donald Lester—were convicted of a serious crime and sentenced to long prison terms. At their trial, held four months after the bank robbery, Staula testified that there had been three robbers. One, who had worn 'a white shirt with short sleeves,' Record, Campbell I, No. 53, October Term 1960, p. 141, he said resembled Lester. Another, who 'had on a blue suit,' id., p. 142, he said resembled Arnold Campbell. The third he had glimpsed '(a)t the vault,' id., p. 170, but could not describe. The Interview Report, however states that Staula 'did not observe a third man in the bank.' Of the two he did observe, one is described as wearing a '(d)ark blue suit' and '(w)hite shirt'; but at the trial, when asked whether he remembered 'what kind of a shirt, if any, the man in the blue suit was wearing,' Record, supra, p. 148, Staula answered: 'No, because I saw him from the side. I didn't see the front of him. I didn't see his shirt.' Ibid. And in the description in the report of the second man Staula observed, there is no mention of his wearing 'a white shirt with short sleeves'; he is only described as 'wearing gray chino pants,' and the report adds that Staula 'only observed the man * * * for an instant and could give no further description of him.' Surely fairness in federal criminal procedure, which the Jencks Act was enacted to secure, Campbell I, 365 U.S., at 92, 81 S.Ct., at 425, 5 L.Ed.2d 428, demands that this Interview Report, reasonably found to be an accurate copy of a written statement made the day after the robbery by Staula and adopted by him as his own, be producible for impeachment purposes.13
13
The judgment of the Court of Appeals and the judgments of conviction are vacated,14 and the case is remanded for further proceedings consistent with this opinion.
14
It is so ordered.
15
Judgment of Court of Appeals and judgments of conviction vacated and case remanded with directions.
16
Mr. Justice CLARK, with whom Mr. Justice HARLAN and Mr. Justice STEWART join, dissenting.
17
In this case an FBI Agent, John F. Toomey, Jr., conducted a 30-minute interview of Dominic Staula, a witness to the bank robbery involved. The Special Agent asked Staula some questions and while they were being answered jotted down notes. Upon completion of the interview the Special Agent orally recited to Staula the substance of the interview, refreshing his memory from his notes as he did so. He then asked Staula if the recitation was correct and received an affirmative reply. This was at noon. About nine o'clock that night the Special Agent transcribed the report on a dictating machine for subsequent typing, using the notes, as well as his memory, for the dictation. After the report was typed by a secretary, working entirely from the transcription, he checked its accuracy and then destroyed the notes.
18
The Court holds the 'oral recitation' to be 'a written statement made by said witness (Staula) and * * * adopted * * * by him,' within the purview of 18 U.S.C. § 3500(e)(1). It reaches this result via a construction reminiscent of the Rube Goldberg cartoons, basing its holding upon the following conclusions: (1) the Special Agent may be fairly deemed to have read his notes back to Staula, since 'it is not seriously suggested that there was a material variance or inconsistency'; (2) Staula approved and thereby adopted this 'reading' of the notes; and (3) trhe Special Agent reduced the notes to narrative in his interview report which, as the trial court found, was 'almost in ipsissima verba the narrative' the Special Agent had recited to Staula. The Court thus transmutes the interview report into a written statement made by Staula and adopted by him and strikes down the conviction because the interview report was not produced at the trial upon the request of the defense.
19
This conclusion, however, will not bear analysis. Even though Staula's approval of the oral recitaiton as correct be deemed arguendo an adoption by him, the oral recitation, nevertheless, was not a written statement within the meaning of the Jencks Act, 18 U.S.C. § 3500. The interview report of the Special Agent was written by the agent, not Staula, and was never approved by Staula in its written form. The statute applies to 'a written statement made by said witness.' At the very least the 'written statement' referred to by the Act is one which is, if not written by the witness, adopted by him in its final written form. The notes to which the agent referred in preparing his report do not rise to the dignity of a statement. They were, as the trial court found, 'jottings' of the Special Agent in aid of his memory for purposes of later dictating his formal report. These notes were not in narrative form, they were not read to Staula by the Special Agent, nor did Staula read them himself or initial or sign them. The Special Agent merely recounted to Staula a narrative of the events which the latter had described. It is true that in so doing he referred to his notes from time to time, but the evidence is clear that the notes were not included verbatim in this recitation. Every lawyer—indeed every layman experienced in the taking of interviews—knows full well that it is extremely unlikely that any two narratives, even though prepared from identical notes, will be alike. Likewise the common experience of all of us belies the conclusion that the interview report was 'almost in ipsissima verba the narrative' recited by the Special Agent to Staula. But even if it were, the statute does not cover a written report such as we have here, prepared from the agent's memory, as well as his notes, some nine hours subsequent to the interview and neither read by or to the witness nor shown to him prior to what the Court terms his 'adoption' of it.
20
The Court reads the trial court's findings as holding that the Special Agent, in presenting the information for Staula's comments after the interview, adhered to the precise words of the notes, so far as practical. But the testimony is to the contrary and is unequivocal.* It then holds that this finding is not clearly erroneous. But the simple answer to this is that the finding has no support in the record. In addition, there are three vital flaws in the adoption of this inference—and that is all that it is—that the oral narrative to Staula was identical to that related nine hours later in the interview report. The trial judge stated what was said to be Toomey's testimony that 'anyone who heard Staula and had Toomey's jottings would have dictated the same words.' (Emphasis supplied.) 199 F.Supp. 905, 907. But this overlooks (1) the limitation Toomey put on the word 'anyone,' i.e., anyone who had 'the same knowledge of the case'; (2) that Toomey did not say that the interview report was in 'the same words' as the narrative to Staula but twice repeated in his testimony that the language of the interview report was 'substantially the same thing' he had related to Staula; and (3) the notes made by Toomey had not been 'just checked with Staula,' ibid., for it had been nine hours since Toomey had even seen him. Hence the findings of the Court of Appeals were entirely correct and those of the trial judge clearly erroneous. This is made as clear as crystal in the concurring opinion of Judge Aldrich. As he said, it would be the defense to use statements to impeach checking back with a witness at noontime of a consolidation of jottings and memory, and the dictation of a report in the evening, would result in the identity inferred by the court.' 303 F.2d 747, 751. Even the expertise of an experienced Special Agent of the FBI does not rescue such a conclusion from beyond credulity.
21
As we said in Palermo v. United States, 360 U.S. 343, 350, 79 S.Ct. 1217, 1223, 3 L.Ed.2d 1287 (1959), the Congress felt that it would 'be grossly unfair to allow the defense to use statements t impeach a witness which could not fairly be said to be the witness' own rather than the product of the investigator's selections, interpretations, and interpolations.' This in exactly what the Court is doing today. Extension of the statute to include such reports can only result in mischief, permitting a skillful defense lawyer to repudiate and destroy a witness and obstruct the administration of justice. I therefore dissent.
1
The Act provides in part:
'(b) After a witness called by the United States has testified on direct examination, the court shall, on motion of the defendant, order the United States to produce any statement (as hereinafter defined) of the witness in the possession of the United States which relates to the subject matter as to which the witness has testified. If the entire contents of any such statement relate to the subject matter of the testimony of the witness, the court shall order it to be delivered directly to the defendant for his examination and use.
'(d) If the United States elects not to comply with an order of the court under paragraph (b) or (c) hereof to deliver to the defendant any such statement, or such portion thereof as the court may direct, the court shall strike from the record the testimony of the witness, and the trial shall proceed unless the court in its discretion shall determine that the interests of justice require that a mistrial be declared.
'(e) The term 'statement', as used in subsections (b), (c), and (d) of this section in relation to any witness called by the United States, means—
'(1) a written statement made by said witness and signed or otherwise adopted or approved by him; or
'(2) a stenographic, mechanical, electrical, or other recording, or a transcription thereof, which is a substantially verbatim recital of an oral statement made by said witness to an agent of the Government and recorded contemporaneously with the making of such oral statement.'
2
Specifically, we held that the district judge was required to hold a nonadversary hearing on the producibility of the notes and Interview Report. We also directed that attention be given the question what sanctions, if any, would be appropriate if it developed that the notes were producible but had been destroyed and that no copy had survived. See 365 U.S., at 98, 81 S.Ct., at 428, 5 L.Ed.2d 428, 18 U.S.C. § 3500(d).
3
The Interview Report was released by the Court of Appeals and was included in the record before this Court in Campbell I. The full text of the report is reproduced in 365 U.S., at 90 and 91, n. 3, 81 S.Ct., at 424, 5 L.Ed.2d 428.
4
Although Toomey testified at the hearing that Staula had not signed or read the notes, Staula had testified at petitioners' trial: 'I think they wrote down what I said, and then I think they gave it back to me to read over, to make sure that it was right. And I think I had to sign it. Now, I am not sure. I couldn't remember before.' 365 U.S., at 89, n. 2, 81 S.Ct., at 424, 5 L.Ed.2d 428. Staula was referring to his interview with Toomey.
5
These issues, basically, are whether the Interview Report is producible under § 3500(e)(2) of the Jencks Act and whether, if the notes are producible under the Act, their destruction gives rise to sanctions under subsection (d), or permits secondary evidence of their contents to be produced. The second district judge found that the Interview Report was a substantially verbatim recording of Staula's oral statement to Toomey and hence producible under § 3500(e)(2). The Court of Appeals disagreed. Moreover, in denying rehearing, the Court of Appeals rendered an opinion holding that no sanctions could attach to Toomey's destruction of his notes because such destruction had not been in bad faith. 303 F.2d, at 751. Our holding that the Interview Report is producible under § 3500(e)(1) makes it unnecessary fur us to consider any of the other issues, and we intimate no view on the correctness of the Court of Appeals' rulings on them.
6
It is settled, of course, that a written statement, to be producible under § 3500(e)(1), need not be signed by the witness, Campbell I, 365 U.S., at 93—94, 81 S.Ct., at 425—426, 5 L.Ed.2d 428; Bergman v. United States, 253 F.2d 933, 935, n. 1 (C.A.6th Cir., 1958); cf. United States v. Allegrucci, 299 F.2d 811, 813 and n. 3 (C.A.3d Cir., 1962), or written by him, Campbell I, 365 U.S., at 93, 81 S.Ct., at 425—426, 5 L.Ed.2d 428; United States v. Thomas, 282 F.2d 191, 194 (C.A.2d Cir., 1960); H.R.Rep. No. 700, 85th Cong., 1st Sess. 5—6 (1957); Note, The Supreme Court, 1960 Term, 75 Harv.L.Rev. 40, 181—182 (1961), or be a substantially verbatim recording of a prior oral statement, see United States v. McCarthy, 301 F.2d 796 (C.A.3d Cir., 1962); United States v. Berry, 277 F.2d 826 (C.A.7th Cir., 1960).
7
The producibility of statements under the Jencks Act and their admissibility under the rules of evidence are separate questions, United States v. Berry, 277 F.2d 826, 830 (C.A.7th Cir., 1960), but obviously closely related.
8
'While technically the court called Toomey itself and permitted the defendants to cross-examine, the restrictions imposed upon counsel were such that it was crossexamination in name only. In spite of the fact that the witness was a special agent of long standing who had discussed his testimony with the Assistant U.S. Attorney immediately before the hearing, the court hovered constantly over him like an over-anxious mother. With respect to correlation between the notes, Staula's statements, and the eventual report, the Supreme Court's directions for a non-adversary proceeding to assist the court in performing its duty, with the defendants permitted to cross-examine, were honored largely in the breach.' 296 F.2d, at 529.
9
The first district judge's findings, so far as pertinent to the issue of producibility under § 3500(e)(1), read as follows:
'3. * * * Agent Toomey repeeated to Mr. Staula, from memory and using the notes which he had taken only to refresh his recollection, the substance of the story which Mr. Staula had related to him. * * *
'4. Agent Toomey did not transcribe the story related to him by Mr. Staula word for word.' 206 F.Supp., at 214. We do not read these as findings that Toomey's oral presentation was not an accurate reproduction of the contents of the notes. Apparently, the judge based his conclusion of nonproducibility under § 3500(e)(1) on the legally erroneous supposition that adoption of an oral presentation of a written statement did not constitute a permissible mode of adopting the written statement.
10
One judge, concurring in the Court of Appeals, questioned the correctness of the District Court's finding that the Interview Report recorded Staula's statement 'almost in ipsissima verba.' 303 F.2d, at 751. But he did not suggest, nor, we think, could he on this record, that there were material differences between the statement and the report. It is not suggested, for example, that the descriptions of the robbers in the report or the statement in the report that Staula had not observed a third robber—the crucial portions of the report for impeachment purposes—differed in the slightest relevant particular from the notes or oral presentation. The only variances, apparently, are grammatical and syntactical changes, rearrangement into chronological order, and omissions and additions of information immaterial for impeachment purposes.
11
As a copy, we consider the report admissible as independent evidence for impeachment purposes, and not merely as secondary evidence of the notes which have been destroyed. See generally United States v. Annunziato, supra, 293 F.2d, at 382; United States v. Thomas, supra, 282 F.2d, at 194—195.
12
'Every experienced trial judge and trial lawyer knows the value for impeaching purposes of statements of the witness recording the events before time dulls treacherous memory. Flat contradiction between the witness' testimony and the version of the events given in his reports is not the only test of inconsistency. The omission from the reports of facts related at the trial, or a contrast in emphasis upon the same facts, even a different order of treatment, are also relevant to the cross-examining process of testing the credibility of a witness' trial testimony.' Jencks v. United States, 353 U.S. 657, 667, 77 S.Ct. 1007, 1013, 1 L.Ed.2d 1103. The Jencks Act, of course, 'reaffirms' our holding in Jencks v. United States, supra. Campbell I, 365 U.S., at 92, 81 S.Ct., at 425, 5 L.Ed.2d 428.
13
We intimate no view on the probative weight to be accorded the Interview Report as impeaching Staula's trial testimony; that is a matter for the triers of facts. And of course nothing we say is intended to suggest that a showing of inconsistency is a prerequisite to the production of documents under the Jencks Act. Jencks v. United States, supra, 353 U.S., at 667—668, 77 S.Ct., at 1012—1013, 1 L.Ed.2d 1103; 18 U.S.C. § 3500(b).
14
Understandably, no contention has been made that the refusal to produce the Interview Report can be deemed harmless error under the principles laid down in Rosenberg v. United States, 360 U.S. 367, 79 S.Ct. 1231, 3 L.Ed.2d 1304. Cf. Gordon v. United States, 344 U.S. 414, 73 S.Ct. 369, 97 L.Ed. 447.
*
'Q. Did you, Mr. Toomey, write down what Mr. Staula told you at the interview?
'A. I took notes concerning the information that he furnished to me.' Cross-examination of Special Agent Toomey, Transcript of Record, p. 4.
'Q. Mr. Toomey, did you give Mr. Staula the paper that you made your notes on to read over?
'(fol. 12) A. I did not, sir.
'Q. Did you read it back to Mr. Staula?
'A. As I previously stated, I took notes and I did not read the notes back to him verbatim.' Ibid.
'THE COURT: The witness said he went over his notes.
'Did you mean to infer that you read your notes over (fol. 54) to Mr. Staula?
'THE WITNESS: No, sir, I did not.
'THE COURT: You looked at them and then you repeated what he said—you didn't read them over to him?
'THE WITNESS: No.
'THE COURT: He didn't see them?
'THE WITNESS: No, your Honor.
'THE COURT: They were in your possession so he could not have done that.
'Q. There was the desk in the front of where both of you people were sitting?
'A. Yes.
'Q. Your notes contained the whole story supplied to you by Mr. Staula?
'A. That is correct.
'Q. And it was vital, wasn't it, Mr. Toomey, that what was contained in your notes be Mr. Staula's story?
'A. That is correct.
'Q. The method you employed to double check was to read your notes, of what Mr. Staula had told you aloud and get Mr. Staula to
agree with you that that was accurate—the information that you had for future use, that is so isn't it, Mr. Toomey?
'(fol. 55) A. Not exactly. I did not read them back to the witness. I went over the story again, refreshing my memory by referring to my notes.
'Q. That is right—that is what your memory was, which was on the papers that you had recorded—and whatever you said came from those papers, that is so, isn't it?
'A. No, sir, not everything.' Id., at 19—20.
'Q. Now, of course, Mr. Toomey, with all your experience, investigating this bank robbery, it is so, isn't it, that the most vital part of the entire interview was the question whether or not your notes meant to Mr. Staula the same thing as they meant to you; that is so, isn't it?
'MR. KOEN: I pray your Honor's judgment.
'THE COURT: Well, he may answer that question.
'A. No.
'Q. Now isn't it so, Mr. Toomey, that another vital part of your interview was whether or not the wellspring of all your knowledge regarding Dominic Staula was correct?
'A. Yes.
'Q. As a matter of fact, after you had read back, it is so, isn't it, sir, that the most vital part of your entire effort taking notes, reading them back, was the question (fol. 327) whether or not Dominic Staula agreed with them?
'A. I didn't read the notes back to him, sir.' Redirect examination of Special Agent Toomey, id., at 123.
| 01
|
373 U.S. 472
83 S.Ct. 1373
10 L.Ed.2d 491
Fenelon BOESCHE, Administrator, etc., Petitioner,v.Stewart L. UDALL, Secretary of the Interior.
No. 332.
Argued Feb. 25, 1963.
Decided May 27, 1963.
Leon BenEzra, Washington, D.C., for petitioner.
Archibald Cox, Sol. Gen., for respondent.
Mr. Justice HARLAN delivered the opinion of the Court.
1
The question presented in this case is whether the Secretary of the Interior has authority to cancel in an administrative proceeding a lease of public lands issued under the provisions of the Mineral Leasing Act of 1920, 30 U.S.C. §§ 181 et seq., in circumstances where such lease was granted in violation of the Act and regulations promulgated thereunder. Because of a seeming conflict in principle between the decision of the Court of Appeals in this case, 112 U.S.App.D.C. 344, 303 F.2d 204, and that of the Court of Appeals for the Tenth Circuit in Pan American Petroleum Corp. v. Pierson, 284 F.2d 649, and also because of the importance of the question to the proper administration of the Mineral Leasing Act, we brought the case here. 371 U.S. 886, 83 S.Ct. 184, 9 L.Ed.2d 120. For reasons stated hereafter we affirm the judgment below.
2
Section 17 of the Mineral Leasing Act, 30 U.S.C. § 226, authorizes the Secretary of the Interior to grant to the first qualified applicant, without competitive bidding, oil and gas leases of lands in the public domain not within a known geologic structure. These are called 'noncompetitive' leases.1 A departmental regulation provides that 'no offer' for a noncompetitive lease 'may be made for less than 640 acres except * * * where the land is surrounded by lands not available for leasing under the act.' 43 CFR § 192.42(d). 'Not available' has always been administratively construed to mean lands not available for leasing to anyone. Hence lands covered only by an outstanding application for a lease are considered available, Natalie Z. Shell, 62 I.D. 417 (1955), and therefore subject to the 640-acre requirement.
3
On September 11, 1956, petitioner2 applied to the Santa Fe Land Office in New Mexico (whose authority also embraces Oklahoma) for an 80-acre noncompetitive lease of land in Oklahoma. There was already on file an application by one Connell for a noncompetitive lease of an adjoining 40-acre tract, but no lease had issued to Connell at the time of petitioner's application. Immediately following petitioner's application two other persons, Cuccia and Conley, filed for a lease of the entire 120 acres. On December 1, 1956, the 40-acre lease issued to Connell, the validity of which is not questioned here. In November 1957 an 80-acre lease issued to petitioner. Following notification that their 120-acre application had been rejected, Cuccia and Conley pursued a departmental appeal, 43 CFR §§ 221.1—221.2. This ultimately resulted in a cancellation of petitioner's lease on the ground that having failed to include in his application the adjoining 40-acre tract (no lease to Connell having then been issued), his 80-acre application was invalid, thus leaving the Cuccia and Conley application in respect of that tract prior in right. Accordingly a lease to them was directed.3
4
The ensuing litigation instituted by petitioner in the Federal District Court resulted in the judgment of the Court of Appeals, now under review, sustaining the administrative cancellation.
5
Petitioner's claim before this Court4 rests on § 31 of the Mineral Leasing Act, 30 U.S.C. § 188, as amended, which, in pertinent part, reads as follows:
6
'Except as otherwise herein provided, any lease issued under the provisions of * * * (this Act) may be forfeited and canceled by an appropriate proceeding in the United States district court for the district in which the property, or some part thereof, is located whenever the lessee fails to comply with any of the provisions of * * * (the Act), of the lease, or of the general regulations promulgated under * * * (the Act) and in force at the date of the lease * * *.
7
'Any lease issued after August 21, 1935,5 under the provisions of * * * (§ 17 of the Act, 30 U.S.C. § 226) shall be subject to cancellation by the Secretary of the Interior after thirty days' notice upon the failure of the lessee to comply with any of the provisions of the lease, unless or until the land covered by any such lease is known to contain valuable deposits of oil or gas.'
8
Petitioner contends: (1) § 31 is the exclusive source of the Secretary's power to forfeit a lease once it has been issued; (2) the section, by its second paragraph, limits administrative cancellation to instances where a lessee has failed to comply with the terms of his lease and then only so long as the land is not known to contain oil or gas; (3) since petitioner failed to comply not with the terms of his lease but with a departmental regulation, cancellation of his lease was governed by the first paragraph of § 31, which requires a judicial proceeding.
9
The Secretary, on the other hand, contends: (1) the provisions of § 31 as a whole apply only to events, whether in violation of lease terms, the Act, or the regulations, occurring after a lease has been issued; (2) the Secretary's authority to cancel on the basis of pre-lease events is found not in § 31 but in his general powers of management over lands in the public domain; (3) that authority remained unaffected by the Mineral Leasing Act.
I.
10
We think that the Secretary, under his general powers of management over the public lands, had authority to cancel this lease administratively for invalidity at its inception, unless such authority was withdrawn by the Mineral Leasing Act. With respect to earlier statutes containing no express administrative cancellation authority, this Court, in Cameron v. United States, 252 U.S. 450, 40 S.Ct. 410, 64 L.Ed. 659, found such authority to exist. In there sustaining the Secretary's power to cancel administratively an invalid mining claim, the Court said (at p. 461 of the 252 U.S., at p. 413 of 40 S.Ct.):
11
'True, the mineral land law does not in itself confer such authority on the Land Department. Neither does it place the authority elsewhere. But this does not mean that the authority does not exist anywhere, for, in the absence of some direction to the contrary, the general statutory provisions before mentioned vest it in the Land Department.'
12
The statutory provisions referred to by the Court are those vesting the Secretary with general managerial powers over the public lands.6
13
The Secretary has also long been held to possess the same authority with respect to other kinds of interests in public lands: Harkness & Wife v. Underhill, 1 Black 316, 17 L.Ed. 208; Lee v. Johnson, 116 U.S. 48, 6 S.Ct. 249, 29 L.Ed. 570; Orchard v. Alexander, 157 U.S. 372, 15 S.Ct. 635, 39 L.Ed. 737 (all involving homestead entries); Brown v. Hitchcock, 173 U.S. 473, 19 S.Ct. 485, 43 L.Ed. 772 (selection list); Knight v. United States Land Assn., 142 U.S. 161, 12 S.Ct. 258, 35 L.Ed. 974 (erroneous survey); Hawley v. Diller, 178 U.S. 476, 20 S.Ct. 986, 44 L.Ed. 1157 (timber land entry); Riverside Oil Co. v. Hitchcock, 190 U.S. 316, 23 S.Ct. 698, 47 L.Ed. 1074 (lieu land selection).
14
The continuing vitality of this general administrative authority was recently confirmed by us in Best v. Humboldt Placer Mining Co., 371 U.S. 334, 83 S.Ct. 379, 9 L.Ed.2d 350.
15
We are not persuaded by petitioner's argument—based on cases holding that land patents once delivered and accepted could be canceled only in judicial proceedings (e.g., Johnson v. Towsley, 13 Wall. 72, 20 L.Ed. 485; Moore v. Robbins, 96 U.S. 530, 24 L.Ed. 848)—that the administrative cancellation power established by Cameron and the other cases cited is confined to so-called equitable interests, and that a lease, which is said to resemble more closely the legal interest conveyed by a land patent, is not subject to such power. We think that no matter how the interest conveyed is denominated the true line of demarcation is whether as a result of the transaction 'all authority or control' over the lands has passed from 'the Executive Department,' Moore v. Robbins, supra, at 533, of 96 U.S., or whether the Government continues to possess some measure of control over them.
16
Unlike a land patent, which divests the Government of title, Congress under the Mineral Leasing Act has not only reserved to the United States the fee interest in the leased land, but has also subjected the lease to exacting restrictions and continuing supervision by the Secretary. Thus, assignments and subleases must be approved by the Secretary, 30 U.S.C. § 187; he may direct complete suspension of operations on the land, 30 U.S.C. § 209, or require the lessee to operate under a cooperative or unit plan, 30 U.S.C. (Supp. IV, 1963), § 226(j); and he may prescribe, as he has, rules and regulations governing in minute detail all facets of the working of the land, 30 U.S.C. § 189; 30 CFR, pt. 221. In short, a mineral lease does not give the lessee anything approaching the full ownership of a fee patentee, nor does it convey an unencumbered estate in the minerals.7 Since the Secretary's connection with the land continues to subsist, he should have the power, in a proper case, to correct his own errors.
17
The dispositive question in this case, therefore, is whether this general administrative power of cancellation was withdrawn by § 31 of the Mineral Leasing Act. To that question we now turn.
II.
18
We believe that both the statute on its face and the legislative history of the enactment show that § 31 reaches only cancellations based on post-lease events and leaves unaffected the Secretary's traditional administrative authority to cancel on the basis of pre-lease factors.
19
1. Were § 31 deemed to be the exclusive source of the power to cancel, the Act, in respect of its 'first qualified applicant' requirement relating to noncompetitive leases, would be self-defeating. For in cases where there had been no breach of a lease, statute, or regulations by the lessee, the factor which alone brings § 31 into play (p. 475, supra), the Secretary would be powerless to cancel the lease even if the lessee had not been the first qualified applicant. Thus, a local land office manager might, without fault on the part of the lessee, inadvertently or purposefully issue a lease to a nonqualified applicant. Yet under petitioner's view of the law the Secretary would be wholly unable, either in administrative or judicial proceedings, to remedy such illegal action.
20
2. The first paragraph of § 31—the one on which petitioner's case depends—speaks entirely in terms of post-lease occurrences. Thus in providing that a lease may be forfeited in judicial proceedings 'whenever the lessee (not an applicant for a lease) fails to comply with any of the provisions of * * * (the Act), of the lease, or of the general regulations promulgated under * * * (the Act) and in force at the date of the lease * * *.' (emphasis added), the provision clearly assumes the existence of a valid lease. It therefore does not cover a situation where, as here, the lease has not been issued at the time the breach of the Act or regulations occurs, for their is at that time no lease to cancel.
21
3. The other forfeiture provisions of the Mineral Leasing Act, as originally enacted, are, with one partial exception, also all concerned with post-lease events. Thus cancellation of a lease in judicial proceedings was authorized when the lessee drilled within 200 feet of the lease boundary (§ 16, 41 Stat. 443), or failed to comply with the rpovision granting rights of way for pipelines through public lands (§ 28, 41 Stat. 449). And with respect to prospecting permits, administrative cancellation was authorized for the permittee's failure to exercise his prospecting rights with due diligence (§ 26, 41 Stat. 448).8
22
The sole exception to this post-issuance scheme of forfeiture and only a partial one at that—is found in § 27, 41 Stat. 448, which provides for judicial forfeiture of interests in excess of certain minimum acreage allowances. But even here it is apparent that the statute was less concerned with initially invalid awards of excessive acreage than with the subsequent pooling of the interests of separate grantees, having the effect of avoiding the acreage limitation. Section 27 was in part born of fears that large oil companies might obtain a monopoly of the oil resources in public lands. See H.R. Rep. No. 206, 65th Cong., 2d Sess., p. 5.
23
4. The background of the Mineral Leasing Act also points against the likelihood that Congress intended to curtail the Secretary's general power respecting administrative cancellation of leases which had been invalidly issued (pp. 476—478, supra).
24
Public lands valuable for their oil deposits had been opened to entry as placer mining claims by the Act of February 11, 1897, 29 Stat. 526. In 1909, confronted with a rapid depletion of petroleum reserves under this system, the President issued a proclamation withdrawing from further entry pending the enactment of conservation legislation upwards of 3,000,000 acres of land in California and Wyoming. In 1914 a mineral leasing bill passed both Houses of Congress but died in conference at the close of the session, see H.R.Rep. No. 668, 63d Cong., 2d Sess., and a mineral leasing program was considered by each subsequent Congress until the Mineral Leasing Act of 1920 was passed.
25
The committee reports reveal that one of the main congressional concerns was the prevention of an overly rapid consumption of oil resources that the Government, particularly the Navy, might need in the future. See H.R.Rep. No. 206, 65th Cong., 2d Sess. 5. Conservation through control was the dominant theme of the debates. See, e.g., H.R.Rep. No. 398, 66th Cong., 1st Sess. 12 13. The report on an earlier version of the bill that eventually became the Mineral Leasing Act stated:
26
'The legislation provided for herein, it is thought, will go a long way toward * * * reserv(ing) to the Government the right to supervise, control, and regulate the * * * (development of natural resources), and prevent monopoly and waste and other lax methods that have grown up in the administration of our public-land laws.' H.R.Rep. No. 1138, 65th Cong., 3d Sess. 19.
27
It would thus be surprising to find in the Act, which was intended to expand, not contract, the Secretary's control over the mineral lands of the United States, a restriction on the Secretary's power to cancel leases issued through administrative error—a power which was then already firmly established. See pp. 476—478, supra. More particularly, we can perceive no reason why Congress should have given the Secretary authority to cancel administratively a prospecting permit (later a noncompetitive lease), § 26, 41 Stat. 448, on the basis of post-issuance events, but implicitly denied him that power in respect of pre-issuance occurrences.
28
The fragmentary excerpts of legislative history relied on by petitioner do not suggest an opposite conclusion. The comment that 'the Secretary of the Interior has no right or authority under the bill to cancel a lease' was made in the course of a discussion on the floor of the Senate about lands on which there were producing wells in existence, and it was assumed that there had been a post-issuance violation of the terms of the lease;9 the Secretary here claims no authority to cancel a lease in such a situation. The remark in the House debates that 'there must be a showing made in court before the forfeiture can be secured' occurred in discussion relating to § 27 of the Act,10 which is, as we have seen, a partial exception to the general scheme of forfeitures.
III.
29
From the beginnings of the Mineral Leasing Act the Secretary has conceived that he had the power drawn in question here, and Congress has never interfered with its exercise.
30
The power was first invoked with respect to prospecting permits, as to which the statute authorized administrative cancellation only on the basis of post-issuance breach (note 8, supra, and accompanying text). See, e.g., Leach v. Cornell, No. A 1687 (unpublished departmental decision, Aug. 13, 1921); McCarthy v. Son, No. A—2398 (unpublished decision, Mar. 4, 1922); Murray v. McNabb, No. A—4412 (unpublished decision, Feb. 14, 1923); Moon v. Woodrow, 51 I.D. 118 (1925); Drake v. Simmons, No. A—16885 (unpublished decision, Oct. 28, 1932). Following the replacement of prospecting permits by noncompetitive leases in 1935 (note 8, supra), the same power was exercised with respect to them. See, e.g., Fenelon Boesche, No. A—21230 (unpublished decision, Feb. 21, 1938); Reay v. Lackie, 60 I.D. 29 (1947); Iola Morrow, No. A—27177 (unpublished decision, Oct. 10, 1955); R.S. Prows, 66 I.D. 19 (1959).11
31
Although the Act, as it relates to oil and gas leases, has been amended a dozen times in the last 40 years,12 Congress has never interfered with this long-continued administrative practice. The conclusion is plain that Congress, if it did not ratify the Secretary's conduct, at least did not regard it as inconsistent with the Mineral Leasing Act. Cf. Ivanhoe Irrig. Dist. v. McCracken, 357 U.S. 275, 293, 78 S.Ct. 1174, 2 L.Ed.2d 1313; Fleming v. Mohawk Co., 331 U.S. 111, 116, 67 S.Ct. 1129, 91 L.Ed. 1375; Billings v. Truesdell, 321 U.S. 542, 552—553, 64 S.Ct. 737, 88 L.Ed. 917.
IV.
32
The present case is a peculiarly appropriate one for administrative determination in the first instance. At issue was simply the question whether petitioner's lease offer was defective because it failed to include an adjoining 40-acre tract under application by another party, and this question had already been decided adversely to petitioner's position by the Secretary in a previous case interpreting the governing departmental regulations. Natalie Z. Shell, supra. Matters of this nature do not warrant initial submission to the judicial process. Indeed the magnitude and complexity of the leasing program conducted by the Secretary13 make it likely that a seriously detrimental effect on the prompt and efficient administration of both the public domain and the federal courts might well be the consequence of a shift from the Secretary to the courts of the power to cancel such defective leases.
33
Recognition of the Secretary's power here serves to protect the public interest in the administration of the public domain. Cancellation of this kind of erroneously issued lease gives effect to regulations designed to check the undue splitting up of tracts, which might facilitate frauds, hinder the development of oil and gas resources, and render supervision very burdensome. See Annie Dell Wheatley, 62 I.D. 292, 293—294 (1955). In addition, exercise of the administrative power in cases of this type safeguards the statutory rights of conflicting claimants.
34
In the day-to-day operation of the Bureau of Land Management, the managers of the local land offices act on each lease application in chronological sequence. If the land is available, if the applicant is qualified, and if the application appears to conform to the regulations, a lease will issue. In due course the manager will come to conflicting applications for the same land. If a later applicant is not the first qualified, his application will be denied. The notice of denial will probably afford the first occasion for an applicant to investigate whether he was in truth the first qualified applicant, and to appeal on this ground to the Director of the Bureau of Land Management and the Secretary of the Interior. Thus, given the nature of the land office's business, the power of cancellation, at least while conflicting applications are pending, is essential to secure the rights of competing applicants.14
35
We sanction no broader rule that is called for by the exigencies of the general situation and the circumstances of this particular case. We hold only that the Secretary has the power to correct administrative errors of the sort involved here by cancellation of leases in proceedings timely instituted by competing applicants for the same land.
36
In so holding we do not open the door to administrative abuses. The regulations of the Department of the Interior provide for adversary proceedings on appeals taken within the Department where other private parties will be affected by the decision. See generally 43 CFR, pt. 221. Appeal is of right, 43 CFR §§ 221.1, 221.31, the appellant is required to notify his opponent, 43 CFR §§ 221.4, 221.34, and the latter has full rights of participation, 43 CFR §§ 221.5—221.6, 221.35. And final action by the Secretary, see 43 CFR § 221.37, has always been subject to judicial review. 30 U.S.C. (Supp. IV, 1963), § 226—2; see, e.g., Noble v. Union River Logging R. Co., 147 U.S. 165, 13 S.Ct. 271, 37 L.Ed. 123; Moore v. Robbins, supra.
37
We conclude that the judgment of the Court of Appeals must be affirmed.
38
Affirmed.
1
Competitive bidding is required for leases of lands that are within known geologic structures.
2
Petitioner is actually the administrator of the estate of the original applicant, but for convenience this opinion will disregard the distinction.
3
Pending the outcome of this litigation, the Land Office Manager has withheld cancellation of petitioner's lease.
4
We limited the writ of certiorari to the single question of the authority of the Secretary to cancel this lease administratively, 371 U.S. 886, 83 S.Ct. 184, 9 L.Ed.2d 120, not bringing here for review the validity of the Secretary's interpretation of the minimum-acreage regulation which was sustained by the Court of Appeals.
5
See note 8, infra.
6
R.S. § 441, 5 U.S.C. § 485, charges the Secretary 'with the supervision of public business relating to * * * (p)ublic lands, including mines.' He is directed by R.S. § 453, 43 U.S.C. § 2, to 'perform * * * all executive duties * * * in anywise respecting * * * public lands (of the United States),' and R.S. § 2478, 43 U.S.C. § 1201, authorizes him 'to enforce and carry into execution, by appropriate regulations, every part of the provisions of * * * (the Title dealing with public lands) not otherwise specially provided for.'
7
In contrast, compare the interest of a mining claimant whose location is perfected:
'The rule is established by innumerable decisions of this Court, and of state and lower federal courts, that, when the location of a mining claim is perfected under the law, it has the effect of a grant by the United States of the right of present and exclusive possession. The claim is property in the fullest sense of that term; and may be sold, transferred, mortgaged, and inherited without infringing any right or title of the United States. The right of the owner is taxable by the state; and is 'real property,' subject to the lien of a judgment * * *. The owner is not required to purchase the claim or secure patent from the United States; but, so long as he complies with the provisions of the mining laws, his possessory right, for all practical purposes of ownership, is as good as though secured by patent.' Wilbur v. United States ex rel. Krushnic, 280 U.S. 306, 316—317, 50 S.Ct. 103, 104, 74 L.Ed. 445.
8
The Act orginally authorized issuance of a prospecting permit to a qualified applicant for land not within a known geologic structure. § 13, 41 Stat. 441. In 1935 prospecting permits were converted to noncompetitive leases, 49 Stat. 674, 676, and the provision for administrative cancellation for breach of the conditions of the grant before the land was proven was carried over to § 17. 49 Stat. 678. In 1946 this provision was transferred from § 17 to § 31. 60 Stat. 956. As explained in S.Rep. No. 1392, 79th Cong., 2d Sess., p. 3, this transfer effected no substantive change in the Secretary's powers:
'Section 31 of the Mineral Leasing Act is amended to consolidate in that section various provisions of the act relating to termination or forfeiture of leases for default by the lessee, the substance of the existing law being retained in the amended section.'
9
58 Cong.Rec. 4168.
10
58 Cong.Rec. 7604.
11
In Melish Consolidated Placer Oil Mining Co. v. Testerman, 53 I.D. 205 (1930), the First Assistant Secretary of the Interior stated that the 'lease once granted was beyond recall by the Secretary and is only subject to cancellation in the Federal courts (Sec. 31, act of February 25, 1920).' This dictum, expressed with reference to a competitive lease, casts no doubt on the Secretary's uniform course of decision regarding permits and noncompetitive leases.
12
See Act of April 30, 1926, 44 Stat. 373; Act of July 3, 1930, 46 Stat. 1007; Act of March 4, 1931, 46 Stat. 1523; Act of August 21, 1935, 49 Stat. 674; Act of August 26, 1937, 50 Stat. 842; Act of August 8, 1946, 60 Stat. 950; Act of June 1, 1948, 62 Stat. 285; Act of September 1, 1949, 63 Stat. 682; Act of July 29, 1954, 68 Stat. 583; Act of August 2, 1954, 68 Stat. 648; Act of September 21, 1959, 73 Stat. 571; Act of September 2, 1960, 74 Stat. 781.
13
The Secretary, in his brief (pp. 12—13), informs us that on June 30, 1960, there were 139,000 outstanding leases supervised by the Department of the Interior under the Mineral Leasing Act which covered 113,000,000 acres. The total number of outstanding leases supervised by the Department under all programs—public lands, acquired lands, Indian, Naval Petroleum Reserve and Outer Continental Shelf—was 159,000, covering 125,000,000 acres.
In many instances there are multiple applications for leases of the same land, sometimes hundreds for the same tract. For example, in a one-month period in 1961 there were 10,742 applications filed in the Santa Fe Land Office alone, many of which affected the same acreage. And in the three-year period ending June 30, 1960, there were 1,129 administrative cancellations out of the total of 54,000 leases issued during that period.
14
Petitioner contends that if an administrative cancellation proceeding is permitted to the Secretary, it would be imprudent for a lessee, since his interest would thus be precarious, to assume the financial risk of developing his lease, and therefore the effective term of his lease would be curtailed even if he were finally held to be the first qualified applicant. But the same delay—and perhaps even a longer one—would result if the Secretary were remitted to judicial proceedings for cancellation.
| 78
|
373 U.S. 420
83 S.Ct. 1366
10 L.Ed.2d 456
Willie NORVELL, Petitioner,v.STATE OF ILLINOIS.
No. 513.
Argued April 24, 1963.
Decided May 27, 1963.
Thomas P. Sullivan, Elmhurst, Ill., for petitioner.
William C. Wines, Chicago, Ill., for respondent.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
Petitioner was convicted of murder in the Illinois courts in 1941 and sentenced to 199 years in prison. Though indigent, he had a lawyer at the trial.
2
On the date of the sentence the docket entry reads: 'Defendant Willie Norvell's motion for allowance of 90 days' time in which to prepare and file his bill of exceptions allowed.' Presumably petitioner's lawyer made that motion, though the record does not indicate one way or the other. Petitioner tried to get a transcript. But again whether he acted on his own or through his lawyer we do not know. We do know, however, that because he was indigent he was unable to pay the costs of the transcript and therefore did not obtain it; and he did not, moreover, pursue an appeal.
3
In 1956 we decided Griffin v. Illinois, 351 U.S. 12, 76 S.Ct. 585, 100 L.Ed. 891, holding on the facts of that case that it was a violation of the Fourteenth Amendment to deprive a person because of his indigency of any rights of appeal afforded all other convicted defendants. And see Draper v. Washington, 372 U.S. 487, 83 S.Ct. 774, 9 L.Ed.2d 899; Eskridge v. Washington, 357 U.S. 214, 78 S.Ct. 1061, 2 L.Ed.2d 1269. Cf. Burns v. Ohio, 360 U.S. 252, 79 S.Ct. 1164, 3 L.Ed.2d 1209; Smith v. Bennett, 365 U.S. 708, 81 S.Ct. 895, 6 L.Ed.2d 39. Thereupon the Supreme Court of Illinois adopted Rule 65—1 (Smith-Hurd's Ill.Ann.Stat., c. 110, § 101.65—1) by which the State provides a free trial transcript to every indigent person convicted of crime, whether he was convicted prior to the Griffin decision or thereafter. An important exception to that rule, applicable here, is the following:
4
'* * * In the event the court finds that it is impossible to furnish petitioner a stenographic transcript of the proceedings at his trial because of the unavailability of the court reporter who reported the proceedings and the inability of any other court reporter to transcribe the notes of the court reporter who served at the trial, or for any other reason, the court shall deny the petition.' Rule 65—1(2).
5
On motion of petitioner in 1956 the trial court was requested to furnish a stenographic transcript of his trial. The trial judge, finding that petitioner had satisfied the conditions prescribed in the Rule, ordered the official shorthand reporter to transcribe his notes and furnish petitioner with a copy of the transcript. It subsequently appeared, however, that the official reporter in question had died some years earlier and that no one could read his shorthand notes. An effort was then made to reconstruct the transcript through the testimony of persons who attended the trial. Ten witnesses testified, including petitioner, but none could recall much of the evidence introduced at the 1941 trial. Thus in 1956 it was not possible for Illinois to supply petitioner with the adequate appellate review of his 1941 conviction which he failed to pursue at that time. Cf. Eskridge v. Washington, supra.
6
The trial judge who heard this motion entered an order denying petitioner a new trial. The Supreme Court of Illinois affirmed. 25 Ill.2d 169, 182 N.W.2d 719. The case is here on a petition for a writ of certiorari. 371 U.S. 860, 83 S.Ct. 135, 9 L.Ed.2d 98.
7
The issue in the case is whether Illinois has made an 'invidious discrimination' against petitioner. Griffin v. Illinois, supra, 351 U.S. p. 18, 76 S.Ct. p. 590. More precisely, the question is whether when a transcript cannot subsequently be obtained or reconstructed through no fault of the State, may it constitutionally draw the line against indigents who had lawyers at their trial but after conviction did not pursue their remedy? Illinois on the face of its rules draws no such distinction. But Illinois in the application of its rules has denied relief in such a case.1 And so we have the narrow question—whether a State may avoid the obligation of Griffin v. Illinois, where, without fault, no transcript can be made available, the indigent having had a lawyer at the trial and no remedy having been sought at the time.
8
If it appeared that the lawyer who represented petitioner at the trial refused to represent him on the appeal and petitioner's indigency prevented him from retaining another, we would have a different case. Cf. Douglas v. California, 372 U.S. 353, 83 S.Ct. 814, 9 L.Ed.2d 811. Petitioner, who testified at the hearing on the motion, made no such claim. Nor did the lawyer, who testified as follows:
9
'I have no independent recollection whether there were motions for a new trial made in the regular course after the trial. All of the constitutional guarantees which were afforded my client, Willie Norvell, were asserted at that time. I have no independent recollection of this case, but I give the defendant every constitutional guarantee that the law affords.
10
'I have no recollection now on whether or not I was ever called upon for an appeal in this matter. I have no recollection one way or the other whether I was called upon to obtain a transcript of the trial.'
11
We do not say that petitioner, having had a lawyer, could be found to have waived his rights on appeal. We only hold that a State, in applying Griffin v. Illinois to situations where no transcript of the trial is available due to the death of the court reporter, may without violation of the Due Process or Equal Protection Clause deny relief to those who, at the time of the trial, had a lawyer and who presumably had his continuing services for purposes of appeal2 and yet failed to pursue an appeal. Exact equality is no prerequisite of equal protection of the laws within the meaning of the Fourteenth Amendment. See Douglas v. California, supra. As we said in Tigner v. Texas, 310 U.S. 141, 147, 60 S.Ct. 879, 882, 84 L.Ed. 1124:
12
'* * * The Fourteenth Amendment enjoins 'the equal protection of the laws', and laws are not abstract propositions. They do not relate to abstract units A, B and C, but are expressions of policy arising out of specific difficulties, addressed to the attainment of specific ends by the use of specific remedies. The Constitution does not require things which are different in fact or opinion to be treated in law as though they were the same.'
13
When, through no fault of the State, transcripts of criminal trials are no longer available because of the death of the court reporter, some practical accommodation must be made. We repeat what was said in Metropolis Theater Co. v. Chicago, 228 U.S. 61, 69—70, 33 S.Ct. 441, 443, 57 L.Ed. 730:
14
'The problems of government are practical ones and may justify, if they do not require, rough accommodations, illogical, it may be, and unscientific. * * * What is best is not always discernible; the wisdom of any choice may be disputed or condemned.'
15
The 'rough accommodations' made by government do not violate the Equal Protection Clause of the Fourteenth Amendment unless the lines drawn are 'hostile or invidious.' Welch v. Henry, 305 U.S. 134, 144, 59 S.Ct. 121, 124, 83 L.Ed. 87. We can make no such condemnation here. For, where transcripts are no longer available, Illinois may rest on the presumption that he who had a lawyer at the trial had one who could protect his rights on appeal.
16
Affirmed.
17
Mr. Justice HARLAN concurs in the result.
18
Mr. Justice GOLDBERG, with whom Mr. Justice STEWART joins, dissenting.
19
I must respectfully dissent because the majority ignores what to me is the key to disposition of this matter. The Illinois Supreme Court decided this case under a misapprehension as to a crucial point of federal constitutional law, but for which it might have resolved the ultimate question in favor of, rather than against, the petitioner.
20
The Illinois court concluded that the decision of this Court in Griffin v. Illinois, 351 U.S. 12, 76 S.Ct. 585, 100 L.Ed. 891, operated prospectively, and not retroactively, in the sense that it invalidated only 'existing financial barriers' to appeal. Given its view of Griffin, it was unnecessary for the state court to consider whether the petitioner, who concededly could not obtain a transcript at the time of his original conviction in 1941 because of his indigency, was at that time deprived of his constitutional rights. Enabled by this erroneous interpretation of Griffin to put aside this basic constitutional issue, the Illinois Supreme Court held only that its present rule, as applied to deny the petitioner a transcript now on his delayed appeal, was not unconstitutional because that denial was based solely upon the present unavailability of the transcript, and not upon anything related to the petitioner's indigency. The majority of this Court seems today to approve at least that holding of the state court, though on grounds different from those relied upon below.
21
The State Supreme Court was in error in its belief that the principles of Griffin have no application to denials of transcripts which occurred before Griffin was decided. Griffin was a constitutional decision vindicating basic Fourteenth Amendment rights and is no more to be restricted in scope or application in time than other constitutional judgments. This, it seems to me, is the clear import of this Court's decision in Eskridge v. Washington, 357 U.S. 214, 78 S.Ct. 1061, 2 L.Ed.2d 1269.*
22
Of course, we do not know how the Illinois court would have resolved the petitioner's claim that he is entitled either to a transcript or a new trial if it had viewed Griffin as having retroactive effect and as controlling with respect to the constitutional deprivation which may have occurred in 1941. Illinois has shown a broad and commendable latitude in implementing the principles enunciated in Griffin, and I would not presume to predict what its courts might do under a proper reading of that case. Because Illinois has not passed upon what is perhaps the controlling issue in the case, and because we ought not to anticipate and resolve difficult constitutional questions unless necessary, I would vacate and remand the case to the Supreme Court of Illinois to permit it to decide the question which it treated as foreclosed only because it believed Griffin's application not to be fully retroactive.
1
The case is analogous to those where this Court's review of a state judgment sustaining a state law is directed to the statute 'as applied and enforced in respect of the situation presented.' Fiske v. Kansas, 274 U.S. 380, 385, 47 S.Ct. 655, 656, 71 L.Ed. 1108. And see Terminiello v. Chicago, 337 U.S. 1, 4, 69 S.Ct. 894, 895, 93 L.Ed. 1131.
2
The record in Griffin v. Illinois, supra, shows that such was not the case there.
*
The Illinois court said simply that Eskridge 'did not hold that the failure to furnish defendant with a free transcript in 1935 denied him a right guaranteed by the fourteenth amendment, but held that the failure in 1956 to furnish him with a free transcript which was still available denied him of such a right.' 25 Ill.2d 169, 173, 182 N.E.2d 719, 720—721. Eskridge was thus read to mean merely 'that such financial barriers could no longer be imposed by the State even though the indigent defendant was sentenced prior to the time the restrictions were invalidated.' Ibid. The issue in Eskridge, however, as presented on review of a 1956 state habeas corpus proceeding, was whether the petitioner there had been deprived of a constitutional right when first convicted in 1935 because he was then denied a transcript with which to prosecute an appeal as an indigent; this Court decided that issue in favor of Eskridge.
| 12
|
373 U.S. 526
83 S.Ct. 1314
10 L.Ed.2d 529
I. A. WATSON, Jr., et al., Petitioners,v.CITY OF MEMPHIS, TENN., et al.
No. 424.
Argued April 17 and 18, 1963.
Decided May 27, 1963.
[Syllabus from pages 526-527 intentionally omitted]
Constance B. Motley, New York City, for petitioners.
Thomas R. Prewitt, Memphis, Tenn., for respondents.
Mr. Justice GOLDBERG delivered the opinion of the Court.
1
The issue in this case, simply stated, is whether the City of Memphis may further delay in meeting fully its constitutional obligation under the Fourteenth Amendment to desegregate its public parks and other municipal recreational facilities.
2
The petitioners, adult Negro residents of Memphis, commenced this action against the city in May 1960 in the United States District Court for the Western District of Tennessee, seeking declaratory and injunctive relief directing immediate desegregation of municipal parks and other city owned or operated recreational facilities from which Negroes were then still excluded. The city denied neither the fact that the majority of the relevant facilities were operated on a segregated basis nor its duty under the Fourteenth Amendment to terminate its policy of conditioning use of such facilities on race. Instead, it pointed to the partial desegregation already effected and attempted to justify its further delay in conforming fully and at once to constitutional mandates by urging the need and wisdom of proceeding slowly and gradually in its desegregation efforts.
3
The District Court denied the relief sought by the petitioners and ordered the city to submit, within six months, a plan providing additional time for desegregation of the relevant facilities.1 The Court of Appeals for the Sixth Circuit affirmed. 303 F.2d 863. We granted certiorari, 371 U.S. 909, 83 S.Ct. 256, 9 L.Ed.2d 169, to consider the important question presented and the applicability here of the principles enunciated by this Court in the second Brown decision, Brown v. Board of Education, 349 U.S. 294, 75 S.Ct. 753, 99 L.Ed. 1083, upon which the courts below relied in further delaying complete vindication of the petitioners' constitutional rights.
4
We find the second Brown decision to be inapplicable here and accordingly reverse the judgment below.
I.
5
It is important at the outset to note the chronological context in which the city makes its claim to entitlement to additional time within which to work out complete elimination of racial barriers to use of the public facilities here involved. It is now more than nine years since this Court held in the first Brown decision, Brown v. Board of Education, 347 U.S. 483, 74 S.Ct. 686, 98 L.Ed. 873, that racial segregation in state public schools violates the Equal Protection Clause of the Fourteenth Amendment. And it was almost eight years ago—in 1955, the year after the decision on the merits in Brown—that the constitutional proscription of state enforced racial segregation was found to apply to public recreational facilities. See Dawson v. Mayor and City Council of Baltimore, 4 Cir., 220 F.2d 386, aff'd, 350 U.S. 877, 76 S.Ct. 133, 100 L.Ed. 774; see also Muir v. Louisville Park Theatrical Assn., 347 U.S. 971, 74 S.Ct. 783, 98 L.Ed. 1112.
6
Thus, the applicability here of the factors and reasoning relied on in framing the 1955 decree in the second Brown decision, supra, which contemplated the possible need of some limited delay in effecting total desegregation of public schools, must be considered not only in the context of factual similarities, if any, between that case and this one, but also in light of the significant fact that the governing constitutional principles no longer bear the imprint of newly enunciated doctrine. In considering the appropriateness of the equitable decree entered below inviting a plan calling for an even longer delay in effecting desegregation, we cannot ignore the passage of a substantial period of time since the original declaration of the manifest unconstitutionality of racial practices such as are here challenged, the repeated and numerous decisions giving notice of such illegality,2 and the many intervening opportunities heretofore available to attain the equality of treatment which the Fourteenth Amendment commands the States to achieve. These factors must inevitably and substantially temper the present import of such broad policy considerations as may have underlain, even in part, the form of decree ultimately framed in the Brown case. Given the extended time which has elapsed, it is far from clear that the mandate of the second Brown decision requiring that desegregation proceed with 'all deliberate speed' would today be fully satisfied by types of plans or programs for desegregation of public educational facilities which eight years ago might have been deemed sufficient. Brown never contemplated that the concept of 'deliberate speed' would countenance indefinite delay in elimination of racial barriers in schools, let alone other public facilities not involving the same physical problems or comparable conditions.
II.
7
When, in 1954, in the first Brown decision, this Court declared the constitutional impermissibility of racial segregation in public schools, it did not immediately frame a decree, but instead invited and heard further argument on the question of relief. In its subsequent opinion, the Court noted that '(f)ull implementation of these (applicable) constitutional principles may require solution of varied local school problems' and indicated an appropriate scope for the application of equitable principles consistent with both public and private need and for 'exercise of (the) * * * traditional attributes of equity power.' 349 U.S., at 299—300, 75 S.Ct., at 756, 99 L.Ed. 1083. The District Courts to which the cases there under consideration were remanded were invested with a discretion appropriate to ultimate fashioning of detailed relief consonant with properly cognizable local conditions. This did not mean, however, that the discretion was even then unfettered or exercisable without restraint. Basic to the remand was the concept that desegregation must proceed with 'all deliberate speed,' and the problems which might be considered and which might justify a decree requiring something less than immediate and total desegregation were severely delimited. Hostility to the constitutional precepts underlying the original decision was expressly and firmly pretermitted as such an operative factor. Id., 349 U.S., at 300, 75 S.Ct., at 756, 99 L.Ed. 1083.
8
The nature of the ultimate resolution effected in the second Brown decision largely reflected no more than a recognition of the unusual and particular problems inhering in desegregating large numbers of schools throughout the country. The careful specification of factors relevant to a determination whether any delay in complying fully and completely with the constitutional mandate would be warranted demonstrated a concern that delay not be conditioned upon insufficient reasons or, in any event, tolerated unless it imperatively and compellingly appeared unavoidable.
9
This case presents no obvious occasion for the application of Brown. We are not here confronted with attempted desegregation of a local school system with any or all of the perhaps uniquely attendant problems, administrative and other, specified in the second Brown decision as proper considerations in weighing the need for further delay in vindicating the Fourteenth Amendment rights of petitioners.3 Desegregation of parks and other recreational facilities does not present the same kinds of cognizable difficulties inhering in elimination of racial classification in schools, at which attendance is compulsory, the adequacy of teachers and facilities crucial, and questions of geographic assignment often of major significance.4
10
Most importantly, of course, it must be recognized that even the delay countenanced by Brown was a necessary, albeit significant, adaptation of the usual principle that any deprivation of constitutional rights calls for prompt rectification. The rights here asserted are, like all such rights, present rights; they are not merely hopes to some future enjoyment of some formalistic constitutional promise. The basic guarantees of our Constitution are warrants for the here and now and, unless there is an overwhelmingly compelling reason, they are to be promptly fulfilled.5 The second Brown decision is but a narrowly drawn, and carefully limited, qualification upon usual precepts of constitutional adjudication and is not to be unnecessarily expanded in application.
11
Solely because of their race, the petitioners here have been refused the use of city owned or operated parks and other recreational facilities which the Constitution mandates be open to their enjoyment on equal terms with white persons. The city has effected, continues to effect, and claims the right or need to prolong patently unconstitutional racial discriminations violative of now long-declared and well-established individual rights. The claims of the city to further delay in affording the petitioners that to which they are clearly and unquestionably entitled cannot be upheld except upon the most convincing and impressive demonstration by the city that such delay is manifestly compelled by constitutionally cognizable circumstances warranting the exercise of an appropriate equitable discretion by a court. In short, the city must sustain an extremely heavy burden of proof.
12
Examination of the facts of this case in light of the foregoing discussion discloses with singular clarity that this burden has not been sustained; indeed, it is patent from the record that the principles enunciated in the second Brown decision have absolutely no application here.
III.
13
The findings of the District Court disclose an unmistakable and pervasive pattern of local segregation, which, in fact, the city makes no attempt to deny, but merely attempts to justify as necessary for the time being. Memphis owns 131 parks, all of which are operated by the Memphis Park Commisson. Of these, only 25 were at the time of trial open to use without regard to race;6 58 were restricted to use by whites and 25 to use by Negroes; the remaining 23 parks were undeveloped raw land. Subject to exceptions, neighborhood parks were generally segregated according to the racial character of the area in which located. The City Park Commission also operates a number of additional recreational facilities, by far the largest share of which were found to be racially segregated. Though a zoo, an art gallery and certain boating and other facilities are now desegregated, about two-thirds (40) of the 61 city-owned playgrounds were at the time of trial reserved for whites only, and the remainder were set aside for Negro use. Thirty of the 56 playgrounds and other facilities operated by the municipal Park Commission on property owned by churches, private groups, or the School Board were set aside for the exclusive use of whites, while 26 were reserved for Negroes. All 12 of the municipal community centers were segregated, eight being available only to whites and four to Negroes. Only two of the seven city golf courses were open to Negroes; play on the remaining five was limited to whites. While several of these properties have been desegregated since the filing of suit, the general pattern of racial segregation in such public recreational facilities persists.7
14
The city asserted in the court below, and states here, that its good faith in attempting to comply with the requirements of the Constitution is not in issue, and contends that gradual desegregation on a facility-by-facility basis is necessary to prevent interracial disturbances, violence, riots, and community confusion and turmoil. The compelling answer to this contention is that constitutional rights may not be denied simply because of hostility to their assertion or exercise. See Wright v. Georgia, 373 U.S. 284, 83 S.Ct. 1240; Brown v. Board of Education, 349 U.S. 294, 300, 75 S.Ct. 753, 756, 99 L.Ed. 1083. Cf. Taylor v. Louisiana, 370 U.S. 154, 82 S.Ct. 1188, 8 L.Ed.2d 395. As declared in Cooper v. Aaron, 358 U.S. 1, 16, 78 S.Ct. 1401, 1409, 3 L.Ed.2d 5, 'law and order are not * * * to be preserved by depriving the Negro children of their constitutional rights.' This is really no more than an application of a principle enunciated much earlier in Buchanan v. Warley, 245 U.S. 60, 38 S.Ct. 16, 62 L.Ed. 149, a case dealing with a somewhat different form of state-ordained segregation—enforced separation of Negroes and whites by neighborhood. A unanimous Court, in striking down the officially imposed pattern of racial segregation there in question, declared almost a half century ago:
15
'It is urged that this proposed segregation will promote the public peace by preventing race conflicts. Desirable as this is, and important as is the preservation of the public peace, this aim cannot be accomplished by laws or ordinances which deny rights created or protected by the federal Constitution.' 245 U.S., at 81, 38 S.Ct., at 20, 62 L.Ed. 149.
16
Beyond this, however, neither the asserted fears of violence and tumult nor the asserted inability to preserve the peace was demonstrated at trial to be anything more than personal speculations or vague disquietudes of city officials. There is no indication that there had been any violence or meaningful disturbances when other recreational facilities had been desegregated. In fact, the only evidence in the record was that such prior transitions had been peaceful.8 The Chairman of the Memphis Park Commission indicated that the city had 'been singularly blessed by the absence of turmoil up to this time on this race question'; notwithstanding the prior desegregation of numerous recreational facilities, the same witness could point as evidence of the unrest or turmoil which would assertedly occur upon complete desegregation of such facilities only to a number of anonymous letters and phone calls which he had received. The Memphis Chief of Police mentioned without further description some 'troubles' at the time bus service was desegregated and referred to threatened violence in connection with a 'sit-in' demonstration at a local store, but, beyond making general predictions, gave no concrete indication of any inability of authorities to maintain the peace. The only violence referred to at any park or recreational facility occurred in segregated parks and was not the product of attempts at desegregation. Moreover, there was no factual evidence to support the bare testimonial speculations that authorities would be unable to cope successfully with any problems which in fact might arise or to meet the need for additional protection should the occasion demand.
17
The existing and commendable goodwill between the races in Memphis, to which both the District Court and some of the witnesses at trial made express and emphatic reference as in some inexplicable fashion supporting the need for further delay, can best be preserved and extended by the observance and protection, not the denial, of the basic constitutional rights here asserted. The best guarantee of civil peace is adherence to, and respect for, the law.
18
The other justifications for delay urged by the city or relied upon by the courts below are no more substantial, either legally or practically. It was, for example, asserted that immediate desegregation of playgrounds and parks would deprive a number of children—both Negro and white—of recreational facilities; this contention was apparently based on the premise that a number of such facilities would have to be closed because of the inadequacy of the 'present' park budget to provide additional 'supervision' assumed to be necessary to operate unsegregated playgrounds. As already noted, however, there is no warrant in this record for assuming that such added supervision would, in fact, be required, much less that police and recreation personnel would be unavailable to meet such needs if they should arise.9 More significantly, however, it is obvious that vindication of conceded constitutional rights cannot be made dependent upon any theory that it is less expensive to deny than to afford them. We will not assume that the citizens of Memphis accept the questionable premise implicit in this argument or that either the resources of the city are inadequate, or its government unresponsive, to the needs of all of its citizens.
19
In support of its judgment, the District Court also pointed out that the recreational facilities available for Negroes were roughly proportional to their number and therefore presumably adequate to meet their needs.10 While the record does not clearly support this, no more need be said than that, even if true, it reflects an impermissible obeisance to the now thoroughly discredited doctrine of 'separate but equal.' The sufficiency of Negro facilities is beside the point; it is the segregation by race that is unconstitutional.
20
Finally, the District Court deferred ruling as to the propriety of ordering elimination of racial barriers at one facility, an art museum, pending initiation of, and decision in, a state court action to construe a racially restrictive covenant contained in the deed of the property to the city. Of course, the outcome of the state suit is irrelevant to whether the city may constitutionally enforce the segregation, regardless of the effect which desegregation may have on its title. Cf. Commonwealth of Pennsylvania v. Board of Trusts, 353 U.S. 230, 77 S.Ct. 806, 1 L.Ed.2d 792. In any event, there is no reason to believe that the restrictive provision will be invoked. The museum has already been opened to Negroes one day a week without complaint.11
21
Since the city has completely failed to demonstrate any compelling or convincing reason requiring further delay in implementing the constitutional proscription of segregation of publicly owned or operated recreational facilities there is no cause whatsoever to depart from the generally operative and here clearly controlling principle that constitutional rights are to be promptly vindicated. The continued denial to petitioners of the use of city facilities solely because of their race is without warrant. Under the facts in this case, the District Court's undoubted discretion in the fashioning and timing of equitable relief was not called into play; rather, affirmative judicial action was required to vindicate plain and present constitutional rights. Today, no less than 50 years ago, the solution to the problems growing out of race relations 'cannot be promoted by depriving citizens of their constitutional rights and privileges,' Buchanan v. Warley, supra, 245 U.S., at 80—81, 38 S.Ct., at 20, 62 L.Ed. 149.
22
The judgment below must be and is reversed and the cause is remanded for further proceedings consistent herewith.
23
Reversed.
1
The plan ultimately formulated, though not part of the record here, was described in oral argument before the Court of Appeals. It does not provide for complete desegregation of all facilities until 1971.
2
See, e.g., Dawson v. Mayor and City Council of Baltimore, 4 Cir., 220 F.2d 386, aff'd, 350 U.S. 877, 76 S.Ct. 133, 100 L.Ed. 774 (beaches and bathhouses); New Orleans City Park Improvement Assn. v. Detiege, 5 Cir., 252 F.2d 122, aff'd, 358 U.S. 54, 79 S.Ct. 99, 3 L.Ed.2d 46 (golf courses and other facilities); City of St. Petersburg v. Alsup, 5 Cir., 238 F.2d 830 (beach and swimming pools); Tate v. Department of Conservation and Development, D.C., 133 F.Supp. 53, aff'd 4 Cir., 231 F.2d 615, cert. denied, 352 U.S. 838, 77 S.Ct. 58, 1 L.Ed.2d 56 (parks); Moorhead v. City of Fort Lauderdale, D.C., 152 F.Supp. 131, aff'd, 5 Cir., 248 F.2d 544 (golf course); Fayson v. Beard, D.C., 134 F.Supp. 379 (parks); Holley v. City of Portsmouth, D.C., 150 F.Supp. 6 (golf course); Ward v. City of Miami, D.C., 151 F.Supp. 593 (golf course); Willie v. Harris County, D.C., 202 F.Supp. 549 (park). It is noteworthy that in none of these cases was the possibility of delay in effecting desegregation even considered.
3
The factors set out by the Court in the second Brown decision were 'problems related to administration, arising from the physical condition of the school plant, the school transportation system, personnel, revision of school districts and attendance areas into compact units to achieve a system of determining admission to the public schools on a nonracial basis, and revision of local laws and regulations which may be necessary in solving the foregoing problems.' 349 U.S., at 300—301, 75 S.Ct., at 756, 99 L.Ed. 1083.
4
Recognition of the possible need for delay has not even been extended to desegregation of state colleges or universities in which like problems were not presented. See, e.g., Florida ex rel. Hawkins v. Board of Control, 350 U.S. 413, 76 S.Ct. 464, 100 L.Ed. 486, where, in remanding on the authority of Brown, this Court said that '(a)s this case involves the admission of a Negro to a graduate professional school, there is no reason for delay. He is entitled to prompt admission under the rules and regulations applicable to other qualified candidates.' 350 U.S., at 414, 76 S.Ct. 464, 100 L.Ed. 486. See also Lucy v. Adams, 350 U.S. 1, 76 S.Ct. 33, 100 L.Ed. 3. Similarly, both before and after Brown, delay has neither been suggested nor countenanced in eliminating operation of racial barriers with respect to transportation, e.g., Boynton v. Virginia, 364 U.S. 454, 81 S.Ct. 182, 5 L.Ed.2d 206; Henderson v. United States, 339 U.S. 816, 70 S.Ct. 843, 94 L.Ed. 1302; Morgan v. Virginia, 328 U.S. 373, 66 S.Ct. 1050, 90 L.Ed. 1317; Browder v. Gayle, D.C., 142 F.Supp. 707, aff'd, 352 U.S. 903, 77 S.Ct. 145, 1 L.Ed.2d 114; voting, e.g., Schnell v. Davis, 336 U.S. 933, 69 S.Ct. 749, 93 L.Ed. 1093; Smith v. Allwright, 321 U.S. 649, 64 S.Ct. 757, 88 L.Ed. 987; racial zoning of property, e.g., City of Richmond v. Deans, 281 U.S. 704, 50 S.Ct. 407, 74 L.Ed. 1128; Buchanan v. Warley, 245 U.S. 60, 38 S.Ct. 16, 62 L.Ed. 149; or employment rights and union representation, e.g., Brotherhood of Railroad Trainmen v. Howard, 343 U.S. 768, 72 S.Ct. 1022, 96 L.Ed. 1283.
5
This principle was well established even under the now discarded 'separate but equal' doctrine. See, e.g., McLaurin v. Oklahoma State Regents for Higher Education, 339 U.S. 637, 642, 70 S.Ct. 851, 854, 94 L.Ed. 1149; Sweatt v. Painter, 339 U.S. 629, 635, 70 S.Ct. 848, 850—851, 94 L.Ed. 1114; Sipuel v. Board of Regents of University of Oklahoma, 332 U.S. 631, 632—633, 68 S.Ct. 299, 300, 92 L.Ed. 247. See also Florida ex rel. Hawkins v. Board of Control, 350 U.S. 413, 414, 76 S.Ct. 464, 465, 100 L.Ed. 486, and notes 2 and 4, supra.
6
These figures, and others referred to in the text, apparently represent the total extent of progress, as of the time of trial, toward desegregation of recreational facilities since this Court's decision eight years ago outlawing the practices here in question. So far as appears, none of the relevant facilities were open for use without regard to race prior to 1955, and, in fact, several new parks have been opened on a segregated basis since that time.
7
It is not entirely clear precisely how many properties have since trial actually been desegregated and how many were merely changed from 'white-only' to 'Negro-only' use in line with changes in neighborhood racial composition.
8
Nor, contrary to predictions, does it appear that violence or disruption of any kind ensued upon elimination of racial barriers to use of certain additional facilities subsequent to trial.
9
Except for the mention of some extra policemen assigned to duty at the city zoo, no showing was made even that additional supervision was necessary or provided at facilities which had been desegregated previously.
10
Approximately 37% of Memphis' 500,000 residents are Negroes; contrary to the apparent assumption of the trial court, the recreational facilities available to Negroes were not at the time of trial all quantitatively proportional to their number and their complete or partial exclusion from certain other facilities evidenced a substantial qualitative difference. Moreover, there was testimony from Negro witnesses that they were excluded from golf courses and playgrounds more convenient to their places of residence than other like facilities open to them.
11
The city also asserted in the District Court that delay was supported by the fact that desegregation of the Fairgrounds would result in a substantial loss of revenues therefrom and would be unfair to contract concessionaires. This claim appears to have been mooted by the intervening elimination of racial restrictions at that facility, seemingly without difficulty.
| 12
|
373 U.S. 405
83 S.Ct. 1370
10 L.Ed.2d 444
UNITED STATES, Appellant,v.Jerry BRAVERMAN.
No. 506.
Argued April 22, 1963.
Decided May 27, 1963.
Frank I. Goodman, Beverly Hills, Cal., for appellant, pro hac vice, by special leave of Court.
No appearance for appellee.
Mr. Justice BLACK delivered the opinion of the Court.
1
Appellee, Jerry Braverman, was transportation manager of the Burbank, California, distribution office of the Andrew Jergens Company, which ships goods in interstate commerce. In June 1962 he was indicted in a United States District Court and charged with having violated § 1 of the Elkins Act1 by having knowingly solicited from a freight forwarder concessions and rebates respecting interstate motor carrier shipments of Jergens' goods so that, had the rebates been granted, goods would have been shipped at a lower rate than that named in the applicable tariffs filed with the Interstate Commerce Commission. The indictment did not allege, and all parties agreed that the Government did not intend to prove, that the rebate would have been for the benefit of the shipper. The district judge, believing that the Act applies only where some 'advantage or discrimination is practiced in favor of the shipper,' ruled that the indictment did not charge an offense under the statute and therefore must be dismissed. The case is properly here on appeal under 18 U.S.C. § 3731.
2
We have concluded that the Elkins Act outlaws solicitations of rebates by any person whatever, no matter for whose benefit the rebate is sought, and that therefore the District Court erred in dismissing the indictment. Section 1 aims in unmistakable language at preserving published tariffs inviolate. That section, first, makes it a misdemeanor for a carrier to fail 'strictly to observe' published tariffs and, second, goes right on to make it unlawful 'for any person, persons, or corporation to offer, grant, or give, or to solicit, accept, or receive any rebate, concession, or discrimination' as to interstate shipments of property 'whereby any such property shall by any device whatever be transported at a less rate than that named in the tariffs published and filed by such carrier * * *.' More unequivocal language would be hard to imagine. It strikes at any and every kind of rebate, no matter by whom or to whom given. Nowhere does the section say or imply that rebates are unlawful only if they are given to or are for the benefit of a shipper. It is a rebate, to whomever given, which the statutory language proscribes.
3
The legislative history of the Elkins Act bears out the conclusion that Congress intended to prevent any kind of departure from the published rates and to that end outlawed all rebates, without requiring a showing of benefit to any shipper. The original Interstate Commerce Act,2 passed in 1887, made it unlawful for any carrier to charge either more or less than the rate specified in its published schedule of rates.3 But the Interstate Commerce Commission, after a decade of experience with the Act, recounted in its Annual Reports to Congress between 1897 and 1902 the secrecy with which rebates were cloaked, the impossibility of enforcing tariffs when the Government had to prove not only a departure but also a benefit to one shipper not received by another, and the pressing need to invoke penalties simply upon showing a departure from a published rate.4
4
These urgings led to the passage of the Elkins Act. A Committee of the House of Representatives, in hearings on several bills proposing amendments to the Interstate Commerce Act, was told by the Chairman of the Interstate Commerce Commission that the existing law was '(i)n some important respects * * * practically unworkable.' In particular, he reported the virtual impossibility of showing that a rebate had resulted in an 'actual discrimination' among shippers and agreed with a member of the Committee that 'any departure' from the published rates should be made an offense.5 In its favorable report on the bill which became the Elkins Act, the Committee observed that it was 'practically impossible to show the discrimination' and recommended passage of its proposal making it 'a penal offense to make any departure from the published rates whether there be a discrimination or not.'6
5
This Court has already held that the sanctions of the Act are not restricted to carriers or shippers and that 'any person' as used in § 1 means 'any person.'7 It was there recognized that, in order to ensure carrier efficiency, rates must be maintained unimpaired and that the Elkins Act no more intended to allow third persons to tamper with the statutory scheme than it intended to allow carriers and shippers themselves to do so. And in an analogous situation, this Court has held that railroad employees who charge passengers more than the established rates are punishable under the Interstate Commerce Act even though they acted for their own gain and even though the railroad was not a party to their conduct.8
6
We have considered the statute before us in light of the salutary rule that criminal statutes should not by interpretation be expanded beyond their plain language.9 But neither can we interpret a statute so narrowly as to defeat its obvious intent.10 Congress, the Commission, and the public were concerned to make certain that, once a tariff had been published, no deviations whatever from that tariff would take place. Nowhere can we find support for the suggestion that some departures were to be checked while others were to be allowed. We would ignore the express language of the Elkins Act, the economic ills which gave rise to its passage, the objects which the framers of the statute had in mind, and the subsequent judicial enforcement of the Act if we limited its operation to only some kinds of rebates or to only some people Congress wanted rates to be published and honored. It wanted rebates stopped. It used fitting language to accomplish that end. We hold that an indictment under § 1 of the Elkins Act states an offense when it charges that a person has solicited a rebate from a common carrier respecting the transportation in interstate commerce of a shipper's property, even though it is not alleged that the rebate was for the benefit of the shipper.
7
Reversed and remanded.
1
49 U.S.C. § 41(1).
2
24 Stat. 379.
3
24 Stat. 381.
4
Annual Reports, Interstate Commerce Commission, Dec. 6, 1897, pp. 46—48, Dec. 24, 1900, p. 10, Jan. 17, 1902, p. 8.
5
Hearings on H.R. 146, 273, 2040, 5775, 8337, and 10930 before the House Committee on Interstate and Foreign Commerce 197 199 (1902).
6
H.R.Rep. No. 3765, 57th Cong., 2d Sess. 5 (1903). The bill passed the House by a vote of 250 to 6, 36 Cong.Rec. 2159 (1903), having already passed the Senate, 36 Cong.Rec. 1633—1634 (1903).
7
Union Pac. R. Co. v. United States, 313 U.S. 450, 463, 61 S.Ct. 1064, 1072, 85 L.Ed. 1453 (1941). The lower courts soon after the passage of the Elkins Act rejected the argument that the Act reached only the carrier and the shipper and held that it was immaterial that rebates were paid to someone other than the shipper. E.g., United States v. Milwaukee Refrigerator Transit Co., 145 F. 1007, 1012 (C.C.E.D.Wis.1906); United States v. Delaware, L. & W.R. Co., 152 F. 269, 273 (C.C.S.D.N.Y.1907).
8
Howitt v. United States, 328 U.S. 189, 66 S.Ct. 923, 90 L.Ed. 1162 (1946).
9
See United States v. Resnick, 299 U.S. 207, 209—210, 57 S.Ct. 126, 127, 81 L.Ed. 127 (1936).
10
See United States v. Raynor, 302 U.S. 540, 552, 58 S.Ct. 353, 358, 82 L.Ed. 413 (1938).
| 01
|
373 U.S. 427
83 S.Ct. 1381
10 L.Ed.2d 462
German S. LOPEZ, Petitioner,v.UNITED STATES.
No. 236.
Argued Jan. 14, 1963.
Decided May 27, 1963.
Edward J. Davis, Boston, Mass., for petitioner.
Louis F. Claiborne, New Orleans, La., for respondent.
Mr. Justice HARLAN delivered the opinion of the Court.
1
The petitioner, German S. Lopez, was tried in a federal court on a four-count indictment charging him with attempted bribery of an Internal Revenue Agent, Roger S. Davis, in violation of 18 U.S.C. § 201.1 The questions before us for review are: (1) whether the trial court's treatment of 'entrapment' constituted reversible error; and (2) whether Davis' testimony relating to a conversation with petitioner on October 24, 1961, which formed the basis of the three counts of the indictment on which petitioner was convicted, and a wire recording of that conversation, were properly admitted into evidence.
2
The evidence at the trial related to three meetings between Lopez and Davis that took place at Clauson's Inn, situated at North Falmouth, Massachusetts, and operated by Lopez under a lease. Davis, who was investigating possible evasion of excise taxes in the area, first visited the Inn on the afternoon of August 31, 1961, when he asked Lopez whether there was any dencing, singing or other entertainment in the evenings and showed him an advertisement for the Inn which stated that there was. Lopez said there was no entertainment and denied responsibility for the advertisement. Davis returned again that evening and saw dancing in the bar and lounge. He described the Inn in a report to his superior the next day as a 'potential delinquent' and said that he would 'follow up.'
3
Davis next returned to the Inn on October 21, when he again saw dancing in the bar and lounge, and spoke with Lopez. Davis' testimony about this meeting may be summarized as follows: Early in the discussion, Davis told Lopez that he thought the establishment would be liable for a cabaret tax and asked to see the books, but Lopez resisted and suggested that they continue the conversation in his office. Once there, Lopez suggested that he would the to avoid all 'aggravation' and to reach an 'agreement.' After Davis said he could not drop the matter and would return the following week, Lopez said he didn't wish to 'insult' Davis and that he didn't know whether to take him into his 'confidence.' Receiving no reply, Lepez put some money on the desk saying:
4
'You can drop this case. Here's $200. Buy your wife a present. And I'll have more money for you at Christmas time. This is all I have now.'
5
Davis balked, and Lopez urged him to take the money and to bring his wife and family for a weekend 'as my guest.' Following some questioning as to the extent of Lopez' business, during the course as which Davis estimated a year's tax as running to $3,000, Lopez added another $220 to the money on the desk, stating that he did not want to be bothered with returns for past years but would file a return for the current quarter. More importunities on Lopez' part followed and Davis finally took the money. Before Davis left, Lopez again said he would file a return for the current quarter and asked Davis to come back on October 24.
6
Lopez, in his version of the events of October 21, admitted giving the $420 to Davis but said the money was given in an effort to have Davis prepare his returns and get his books in proper order. According to Lopez' testimony, he told Davis that he would file returns from October 17 on, since on that date the Inn had changed its policy to one of entertainment.
7
After leaving the Inn, Davis reported the meeting to a fellow agent and to his superior and turned over the $420 to a Regional Inspector. On the morning of October 24, he met with four Internal Revenue Inspectors, who instructed him to keep his appointment with Lopez, to 'pretend to play along with the scheme,' and to draw the conversation back to the meeting of October 21. Davis was then equipped with two electronic devices, a pocket battery-operated transmitter (which subsequently failed to work) and a pocket wire recorder, which recorded the conversation between Lopez and Davis at their meeting later in the day.
8
According to the recording of that conversation, Davis suggested they talk in Lopez' office and, once inside the office, Davis started to explain the excise tax form and to discuss the return. Before any computations were made, Lopez said he had never thought he needed to file a cabaret tax return, and the conversation then continued:
9
'Lopez: * * * Whatever we decide to do from here on I'd like you to be on my side and visit with me. Deduct anything you think you should and I'll be happy to * * * because you may prevent something coming up in the office. If you think I should be advised about it let me know. Pick up the phone. I can meet you in town or anywhere you want. For your information the other night I have to * * *.
10
'Davis: Well, you know I've got a job to do.
11
'Lopez: Yes, and Uncle Sam is bigger than you and I are and we pay a lot of texes, and if we can benefit something by it individually, let's keep it that way and believe me anything that transpires between you and I, not even my wife or my accountant or anybody is aware of it. So I want you to feel that way about it.'2
12
The two then discussed receipts and the potential tax liability for 1959—1961, and Lopez protested that Davis' estimates were very high, although he did not deny the fact of liability. After Davis said, 'I don't want to get greedy or anything,' Lopez gave him $200 and later in the conversation told Davis he could bring his family down for a free weekend and should '(c)ome in every so often and I'll give you a couple of hundred dollars every time you come in.' At one point, Lopez said 'Now if you suggest that I should file returns from this point on, I'll do it. If you should suggest that I can get by without doing it, then just drop in every so often and I'll * * *.' Lopez also confirmed that he had given Davis $420 on October 21.
13
Lopez, in his testimony, did not question the accuracy of the recording and in fact said little more about the meeting of October 24 than that Davis had gone into a lot of figures and that he (Lopez) had become emotionally upset because he felt that Davis 'was not there for the purpose that he came in there for on October 21st.' He did not suggest that Davis had induced him to offer any bribes.
14
The first of the four counts in the ensuing indictment charged that at the meeting of October 21, Lopez gave Davis the $420 with intent to induce Davis, among other things, 'to refrain from making an examination of the books and records relating to sales and receipts' at the Inn from 1959—1961.3 The remaining three counts related to the meeting of October 24, and charged three separate acts of attempted bribery, each for the purpose of influencing Davis to aid in concealing sales, receipts, and any cabaret tax due for the years 1959—1961. The acts were the giving of $200 to Davis (Count 2), the promise of an additional $200 the following month (Count 3), and the promise of a free weekend for Davis and his family (Count 4).
15
Prior to trial, petitioner filed a motion to suppress as evidence the wire recording of the October 24 conversation between Lopez and Davis. After hearing, this motion was denied. At trial, the motion was renewed and again denied, and the recording was received in evidence. Petitioner did not object to the testimony of Agent Davis relating to the October 24 conversation.
16
In his charge to the jury, the trial judge emphasized the presumption of innocence and the burden on the Government to establish 'every essential element' of the crime beyond a reasonable doubt. He then detailed what these essential elements were and called particular attention to the contrast between the specific intent charged in Count 1—to prevent an examination of books and records—and the more general intent charged in the other three counts—to conceal liability for the tax in question. He strongly suggested that the specific intent alleged in Count 1 had not been established beyond a reasonable doubt.
17
Although defense counsel had briefly adverted to the possibility of 'entrapment' in his summation to the jury, he did not request judgment of acquittal on that ground. Nor did he request any instruction on the point or offer at the trial any evidence particularly aimed at such a defense. Nevertheless, the trial judge did charge on entrapment.4 Petitioner made no objection to this instruction, or to any other aspect of the charge.
18
The jury acquitted on Count 1 and found petitioner guilty on Counts 2, 3 and 4. A motion for judgment notwithstanding the verdict 'as a matter of law on the evidence' was denied, and petitioner was sentenced to a term of imprisonment for one year.
19
Following per curiam affirmance of the conviction by the Court of Appeals for the First Circuit, 305 F.2d 825, we granted certiorari, 371 U.S. 859, 83 S.Ct. 116, 9 L.Ed.2d 97, to consider the two questions stated at the outset of this opinion. Supra, pp. 428—429.
I.
20
The defense of entrapment, its meaning, purpose, and application, are problems that have sharply divided this Court on past occasions. See Sorrells v. United States, 287 U.S. 435, 53 S.Ct. 210, 77 L.Ed. 413; Sherman v. United States, 356 U.S. 369, 78 S.Ct. 819, 2 L.Ed.2d 848; Masciale v. United States, 356 U.S. 386, 78 S.Ct. 827, 2 L.Ed.2d 859. Whether in the absence of a conclusive showing the defense is for the court or the jury, and whether the controlling standard looks only to the conduct of the Government, or also takes into account the predisposition of the defendant, are among the issues that have been mooted. We need not, however, concern ourselves with any of these questions here, for under any approach, petitioner's belated claim of entrapment is insubstantial, and the record fails to show any prejudice that would warrant reversal on this score.
21
The conduct with which the defense of entrapment is concerned is the manufacturing of crime by law enforcement officials and their agents. Such conduct, of course, is far different from the permissible stratagems involved in the detection and prevention of crime. Thus before the issue of entrapment can fairly be said to have been presented in a criminal prosecution there must have been at least some showing of the kind of conduct by government agents which may well have induced the accused to commit the crime charged.
22
In the case before us we think that such a showing has not been made. It is undisputed that at the meeting of October 21, petitioner made an unsolicited offer of $420 to Agent Davis. The references to the October 21 offer in the recorded conversation scarcely leave room for doubt that this offer was made for the same general purpose as the bribes offered at the October 24 meeting: to obtain Davis' assistance in concealing any cabaret tax liability for past and present periods.5 As to the meeting of October 24, the recording shows that petitioner's improper overtures began almost at the outset of the discussion, when he stated: 'Deduct anything you think you should and I'll be happy to * * * because you may prevent something coming up in the office.' This and similar statements preceded Davis' computations,6 and his comment, 'I don't want to get greedy,' on which petitioner so heavily relies. Moreover, we find nothing in the recording as a whole, or in petitioner's own testimony, to suggest that his conduct on October 24 was instigated by Davis. Upon any reasonable assessment of the record, it seems manifest that all that Davis was doing was to afford an opportunity for the continuation of a course of criminal conduct, upon which the petitioner had earlier voluntarily embarked, under circumstances susceptible of proof.
23
It is therefore evident that, under any theory, entrapment has not been shown as a matter of law. Indeed, the paucity of the showing might well have justified a refusal to instruct the jury at all on entrapment.7 But in any event no request for such an instruction was made, and there was no objection to the instruction given. Under these circumstances, petitioner may not now challenge the form of that instruction. See Fed.Rules Crim.Proc., 30;8 Moore v. United States, 104 U.S.App.D.C. 327, 262 F.2d 216; Martinez v. United States, 10 Cir., 300 F.2d 9. Nor was there on this score any such plain error in the charge, affecting substantial rights, as would warrant reversal despite the failure to object. See Fed.Rules Crim.Proc., 52(b). Since the record does not disclose a sufficient showing that petitioner was induced to offer a bribe, we cannot conclude that he was prejudiced by the charge on burden of proof, even assuming that the burden called for was too great. By the same token, we are not persuaded that in this case it is significant to determine whether entrapment should turn on the effect of the Government's conduct on 'men of ordinary firmness,' as the court charged, or on the effect on the particular defendant. Accordingly, we do not reach the question whether the charge was in every respect a correct statement of the law. It is enough to say that in the circumstances of this case, there was in any event no reversible error.
II.
24
Petitioner's remaining contentions concern the admissibility of the evidence relating to his conversation with Davis on October 24. His argument is primarily addressed to the recording of the conversation, which he claims was obtained in violation of his rights under the Fourth Amendment.9 Recognizing the weakness of this position if Davis was properly permitted to testify about the same conversation, petitioner now challenges that testimony as well, although he failed to do so at the trial. His theory is that, in view of Davis' alleged falsification of his mission, he gained access to petitioner's office by misrepresentation and all evidence obtained in the office i.e., his conversation with petitioner, was illegally 'seized.' In support of this theory, he relies on Gouled v. United States, 255 U.S. 298, 41 S.Ct. 261, 65 L.Ed. 647, and Silverman v. United States, 365 U.S. 505, 81 S.Ct. 679, 5 L.Ed.2d 734. But under the circumstances of the present case, neither of these decisions lends any comfort to petitioner, and indeed their rationale buttresses the conclusion that the evidence was properly admitted. See On Lee v. United States, 343 U.S. 747, 72 S.Ct. 967, 96 L.Ed. 1270.10
25
We need not be long detained by the belated claim that Davis should not have been permitted to testify about the conversation of October 24. Davis was not guilty of an unlawful invasion of petitioner's office simply because his apparent willingness to accept a bribe was not real. Compare Wong Sun v. United States, 371 U.S. 471, 83 S.Ct. 407, 9 L.Ed.2d 441. He was in the office with petitioner's consent, and while there he did not violate the privacy of the office by seizing something surreptitiously without petitioner's knowledge. Compare Gouled v. United States, supra. The only evidence obtained consisted of statements made by Lopez to Davis, statements which Lopez knew full well could be used against him by Davis if he wished. We decline to hold that whenever an offer of a bribe is made in private, and the offeree does not intend to accept, that offer is a constitutionally protected communication.
26
Once it is plain that Davis could properly testify about his conversation with Lopez, the constitutional claim relating to the recording of that conversation emerges in proper perspective. The Court has in the past sustained instances of 'electronic eavesdropping' against constitutional challenge, when devices have been used to enable government agents to overhear conversations which would have been beyond the reach of the human ear. See, e.g., Olmstead v. United States, 277 U.S. 438, 48 S.Ct. 564, 72 L.Ed. 944; Goldman v. United States, 316 U.S. 129, 62 S.Ct. 993, 86 L.Ed. 1322. It has been insisted only that the electronic device not be planted by an unlawful physical invasion of a constitutionally protected area. Silverman v. United States, supra. The validity of these decisions is not in question here. Indeed this case involves no 'eavesdropping' whatever in any proper sense of that term. The Government did not use an electronic device to listen in on conversations it could not otherwise have heard. Instead, the device was used only to obtain the most reliable evidence possible of a conversation in which the Government's own agent was a participant and which that agent was fully entitled to disclose. And the device was not planted by means of an unlawful physical invasion of petitioner's premises under circumstances which would violate the Fourth Amendment. It was carried in and out by an agent who was there with petitioner's assent, and it neither saw nor heard more than the agent himself.
27
The case is thus quite similar to Rathbun v. United States, 355 U.S. 107, 78 S.Ct. 161, 2 L.Ed.2d 134, in which we sustained against statutory attack the admission in evidence of the testimony of a policeman as to a conversation he overheard on an extension telephone with the consent of a party to the conversation. The present case, if anything, is even clearer, since in Rathbun it was conceded by all concerned 'that either party may record the conversation and publish it.' 355 U.S. at 110, 78 S.Ct. at 163. (Emphasis added.)
28
Stripped to its essentials, petitioner's argument amounts to saying that he has a constitutional right to rely on possible flaws in the agent's memory, or to challenge the agent's credibility without being beset by corroborating evidence that is not susceptible of impeachment. For no other argument can justify excluding an accurate version of a conversation that the agent could testify to from memory.11 We think the risk that petitioner took in offering a bribe to Davis fairly included the risk that the offer would be accurately reproduced in court, whether by faultless memory or mechanical recording.
29
It is urged that whether or not the recording violated petitioner's constitutional rights, we should prevent its introduction in evidence in this federal trial in the exercise of our supervisory powers. But the court's inherent power to refuse to receive material evidence is a power that must be sparingly exercised. Its application in the present case, where there has been no manifestly improper conduct by federal officials, would be wholly unwarranted.12
30
The function of a criminal trial is to seek out and determine the truth or falsity of the charges brought against the defendant. Proper fulfillment of this function requires that, constitutional limitations aside, all relevant, competent evidence be admissible, unless the manner in which it has been obtained—for example, by violating some statute or rule of procedure—compels the formulation of a rule excluding its introduction in a federal court. See, e.g., McNabb v. United States, 318 U.S. 332, 63 S.Ct. 608, 87 L.Ed. 819; Mallory v. United States, 354 U.S. 449, 77 S.Ct. 1356, 1 L.Ed.2d 1479.
31
When we look for the overriding considerations that might require the exclusion of the highly useful evidence involved here, we find nothing. There has been no invasion of constitutionally protected rights, and no violation of federal law or rules of procedure. Indeed, there has not even been any electronic eavesdropping on a private conversation which government agents could not otherwise have overheard. There has, in short, been no act of any kind which could justify the creation of an exclusionary rule. We therefore conclude that the judgment of the Court of Appeals must be affirmed.
32
Affirmed.
33
Mr. Chief Justice WARREN, concurring in the result.
34
I concur in the result achieved by the Court but feel compelled to state my views separately. As pointed out in the dissenting opinion of Mr. Justice BRENNAN, the majority opinion may be interpreted as reaffirming sub silentio the result in On Lee v. United States, 343 U.S. 747, 72 S.Ct. 967, 96 L.Ed. 1270. Since I agree with Mr. Justice BRENNAN that On Lee was wrongly decided and should not be revitalized, but base my views on grounds different from those stated in the dissent, I have chosen to concur specially. Although the dissent assumes that this case and On Lee are in all respects the same, to me they are quite dissimilar constitutionally and from the viewpoint of what this Court should permit under its supervisory powers over the administration of criminal justice in the federal courts.
35
I also share the opinion of Mr. Justice BRENNAN that the fantastic advances in the field of electronic communication constitute a great danger to the privacy of the individual; that indiscriminate use of such devices in law enforcement raises grave constitutional questions under the Fourth and Fifth Amendments; and that these considerations impose a heavier responsibility on this Court in its supervision of the fairness of procedures in the federal court system. However, I do not believe that, as a result, all uses of such devices should be proscribed either as unconstitutional or as unfair law enforcement methods. One of the lines I would draw would be between this case and On Lee.
36
As Mr. Justice HARLAN sets out in greater detail, Agent Davis, upon entering the premises of the petitioner, gave full notice of both his authority and purpose—to investigate possible evasion or delinquency in the payment of federal taxes. In the course of this investigation, the petitioner offered Davis a bribe and promised more in the future if Davis would conceal the facts of the petitioner's tax evasion. Davis accepted the money and promptly reported it to his superiors. On a return visit to the petitioner's place of business to complete the investigation, Davis was outfitted with a concealed recorder to tape his conversation with the petitioner. At trial, Davis testified to both of his conversations with the petitioner, and the tape recording was introduced to corroborate this testimony. The petitioner did not claim he was entrapped into the bribery or that the purpose of the investigation from the start was to induce the bribe. On the contrary, he admitted giving the money to Davis but claimed that it was for the purpose of having the latter prepare his tax return. The only purpose the recording served was to protect the credibility of Davis against that of a man who wished to corrupt a public servant in the performance of his public trust. I find nothing unfair in this procedure. Tax agents like Agent Davis are required to examine the tax returns of suspected tax evaders as a necessary part of our national taxation system. Many of these taxpayers interviewed are integral parts of the underworld. In the performance of their duty, agents are thus often faced with situations where proof of an attempted bribe will be a matter of their word against that of the tax evader and perhaps some of his associates. They should not be defenseless against outright denials or claims of entrapment, claims which, if not open to conclusive refutation, will undermine the reputation of the individual agent for honesty and the public's confidence in his work. Where confronted with such a situation, it is only fair that an agent be permitted to support his credibility with a recording as Agent Davis did in this case.
37
On Lee, however, is a completely different story. When On Lee was arrested, the only direct evidence that he was engaged in the distribution of opium was the unreliable testimony of an alleged accomplice who handled the contacts with purchasers and had made the mistake of selling to an undercover narcotics agent. To strengthen its case against On Lee, the Government sent a 'special employee,' one Chin Poy, into On Lee's laundry armed with a concealed transmitter, On Lee being out on bail pending indictment at the time. Chin Poy had known On Lee for 16 years and had formerly been his employee. His criminal character is exposed by the familiarity with which he and On Lee discussed the narcotics traffic and the agreement of the latter to supply him with narcotics at his request in the future. Thus, Chin Poy, armed with the transmitter engaged On Lee in conversation for the purpose of eliciting admissions that On Lee was part of an opium syndicate and to encourage him to commit another crime. At trial, instead of calling Chin Poy to testify, the Government put on the narcotics agent who had been at the receiving end of the radio contact with Chin Poy to testify to the admissions made by On Lee, testimony that led directly to conviction.
38
The use and purpose of the transmitter in On Lee was substantially different from the use of the recorder here. Its advantage was not to corroborate the testimony of Chin Poy, but rather, to obviate the need to put him on the stand. The Court in On Lee itself stated:
39
'We can only speculate on the reasons why Chin Poy was not called. It seems a not unlikely assumption that the very defects of character and blemishes of record which made On Lee trust him with confidences would make a jury distruct his testimony. Chin Poy was close enough to the underworld to serve as bait, near enough the criminal design so that petitioner would embrace him as a confidante, but too close to it for the Government to vouch for him as a witness. Instead, the Government called agent Lee.' However, there were further advantages in not using Chin Poy. Had Chin Poy been available for cross-examination, counsel for On Lee could have explored the nature of Chin Poy's friendship with On Lee, the possibility of other unmonitored conversations and appeals to friendship, the possibility of entrapments, police pressure brought to bear to persuade Chin Poy to turn informer, and Chin Poy's own recollection of the contents of the conversation. His testimony might not only have seriously discredited the prosecution, but might also have raised questions of constitutional proportions. This Court has not yet established the limits within which the police may use an informer to appeal to friendship and camaraderie-in-crime to induce admissions from a suspect, but suffice it to say here, the issue is substantial. We have already struck down the use of psychological pressures and appeals to friendship to induce admissions or confessions under not totally dissimilar circumstances. Leyra v. Deno, 347 U.S. 556, 74 S.Ct. 716, 98 L.Ed. 948; Spano v. New York, 360 U.S. 315, 79 S.Ct. 1202, 3 L.Ed.2d 1265.1 Yet the fact remains that without the testimony of Chin Poy, counsel for On Lee could not develop a record sufficient to raise and present the issue for decision, and the courts could not evaluate the full impact of such practices upon the rights of an accused or upon the administration of criminal justice.2
40
It is no answer to say that the defense can call an informer such as Chin Poy as a hostile witness. The prosecution may have an interest in concealing his identity or whereabouts. Roviaro v. United States, 353 U.S. 53, 77 S.Ct. 623, 1 L.Ed.2d 639. He may be so undependable and disreputable that no defense counsel would risk putting him on the stand. Moreover, as a defense witness, he would be open to impeachment by the Government, his late employer. The tactical possibilities of this situation would be apparent to a prosecutor bent on obtaining conviction. Through use of a recorder or transmitter, he may place in the case-in-chief evidence of statements supporting conviction which is not open to impeachment. And if not required to call the informer, he may place on the defense the onus of finding and calling a disreputable witness, who if called, may be impeached on all collateral issues favoring the defense. The effect on law enforcement practices need hardly be stated: the more disreputable the informer employed by the Government, the less likely the accused will be able to establish any questionable law enforcement methods used to convict him.
41
Thus while I join the Court in permitting the use of electronic devices to corroborate an agent under the particular facts of this case, I cannot sanction by implication the use of these same devices to radically shift the pattern of presentation of evidence in the criminal trial, a shift that may be used to conceal substantial factual and legal issues concerning the rights of the accused and the administration of criminal justice.3 Cf. On Lee v. United States, 343 U.S. 747, 758, 72 S.Ct. 967, 974 (Black, J., dissenting).
42
Mr. Justice BRENNAN, with whom Mr. Justice DOUGLAS and Mr. Justice GOLDBERG join, dissenting.
43
In On Lee v. United States, 343 U.S. 747, 72 S.Ct. 967, 96 L.Ed. 1270, the Court sustained the admission in evidence of the testimony of a federal agent as to incriminating statements made by the accused, a laundryman, on trial for narcotics offenses. The statements were made by the accused while at large on bail pending trial in a conversation in his shop with an acquaintance and former employee, who, unknown to the accused, was a government informer and carried a radio transmitter concealed on his person. The federal agent, equipped with a radio receiver tuned to the transmitter, heard the transmitted conversation while standing on the sidewalk outside the laundry. The Court rejected arguments invoking the Fourth Amendment and our supervisory power against the admissibility of the agent's testimony. I believe that that decision was error, in reason and authority, at the time it was decided; that subsequent decisions and subsequent experience have sapped whatever vitality it may once have had; that it should now be regarded as overruled; that the instant case is rationally indistinguishable; and that, therefore, we should reverse the judgment below.
I.
44
The United States in its brief and oral argument before this Court in the instant case made little effort to justify the result in On Lee, doubtless because it realizes that that decision has lost virtually all its force as authority. Instead, the Government seeks to distinguish the instant case. This strategy has succeeded, it appears, with a majority of my Brethren. The Court's refusal to accord more than passing mention in its opinion to the only decision of this Court—On Lee-factually analogous to the case at bar suggests very strongly that some of my colleagues who have joined the Court's opinion today agree with us that On Lee should be considered a dead letter. For the Court, rather than follow On Lee, has adopted the substance of the Government's attempted distinction between On Lee and the instant case.
45
The Government argues as follows: 'Petitioner can hardly complain that his secret thoughts were unfairly extracted from him, for they were, from the beginning, intended to be put into words, and to be communicated to the very auditor who heard them.' This argument has two prongs and I take the second first. To be sure, there were two auditors in On Lee—the informer and the federal agent outside. But equally are there two auditors here—the federal agent and the Minifon. In On Lee, the informer was the vehicle whereby the accused's statements were transmitted to a third party, whose subsequent testimony was evidence of the statements. So here, the intended auditor, Agent Davis, was the vehicle enabling the Minifon to record petitioner's statements in a form that could be, and was, offered as evidence thereof.
46
The Government would have it that the 'human witness (Davis) actually testifies and the machine merely repeats and corroborates his narrative.' But it can make no difference that Davis did, and the informer in On Lee did not, himself testify; for the challenged evidence, the Minifon recording, is independent evidence of the statements to which Davis also testified. A mechanical recording is not evidence that is merely repetitive or corroborative of human testimony. To be sure, it must be authenticated before it can be introduced. But once it is authenticated, its credibility does not depend upon the credibility of the human witness. Therein does a mechanical recording of a conversation differ fundamentally from, for example, notes that one of the parties to the conversation may have taken. A trier of fact credits the notes only insofar as he credits the notetaker. But he credits the Minifon recording not because he believes Davis accurately testified as to Lopez' statements but because he believes the Minifon accurately transcribed those statements. This distinction is well settled in the law of evidence, and it has been held that Minifon recordings are independent third-party evidence. Monroe v. United States, 98 U.S.App.D.C. 228, 233—234, 234 F.2d 49, 54—55.1
47
The other half of the Government's argument is that Lopez surrendered his right of privacy when he communicated his 'secret thoughts' to Agent Davis. The assumption, manifestly untenable, is that the Fourth Amendment is only designed to protect secrecy. If a person commits his secret thoughts to paper, that is no license for the police to seize the paper; if a person communicates his secret thoughts verbally to another, that is no license for the police to record the words. Silverman v. United States, 365 U.S. 505, 81 S.Ct. 679, 5 L.Ed.2d 734. On Lee certainly rested on no such theory of waiver. The right of privacy would mean little if it were limited to a person's solitary thoughts, and so fostered secretiveness. It must embrace a concept of the liberty of one's communications, and historically it has. 'The common law secures to each individual the right of determining, ordinarily, to what extent his thoughts, sentiments, and emotions shall be communicated to others * * * and even if he has chosen to give them expression, he generally retains the power to fix the limits of the publicity which shall be given them.' Warren and Brandeis, The Right to Privacy, 4 Harv.L.Rev. 193, 198 (1890). (Emphasis supplied.)
48
That is not to say that all communications are privileged. On Lee assumed the risk that his acquaintance would divulge their conversaion; Lopez assumed the same risk vis-a -vis Davis. The risk inheres in all communications which are not in the sight of the law privileged. It is not an undue risk to ask persons to assume, for it does no more than compel them to use discretion in choosing their auditors, to make damaging disclosures only to persons whose character and motives may be trusted. But the risk which both On Lee and today's decision impose is of a different order. It is the risk that third parties, whether mechanical auditors like the Minifon or human transcribers of mechanical transmissions as in On Lee—third parties who cannot be shut out of a conversation as conventional eavesdroppers can be, merely by a lowering of voices, or withdrawing to a private place—may give independent evidence of any conversation. There is only one way to guard against such a risk, and that is to keep one's mouth shut on all occasions.
49
It is no answer to say that there is no social interest in encouraging Lopez to offer bribes to federal agents. Neither is there a social interest in allowing a murderer to conceal the murder weapon in his home. But there is a right of liberty of communications as of possessions, and the right can only be secure if its limitations are defined within a framework of principle. The Fourth Amendment does not forbid all searches, but it defines the limits and conditions of permissible searches; the compelled disclosure of private communications by electronic means ought equally to be subject to legal regulation. And if this principle is granted, I see no reasoned basis for reaching different results depending upon whether the conversation is with a private person, with a federal undercover agent (On Lee), or with an avowed federal agent, as here.
50
The CHIEF JUSTICE, concurring in the Court's result, suggests two further distinctions between On Lee and the instant case: first, that Agent Davis, in carrying a concealed recording device, was legitimately seeking to protect his reputation as a honest public servant; and second, that in the instant case, unlike On Lee, electronically obtained evidence was not used so as to circumvent the production of the key government witness. I admit these are differences, but I do not see how they bear upon the problem of the case before us, which is the admissibility in a federal criminal trial of the fruits of surreptitious electronic surveillance. Whether a federal tax agent, in order to convince his superiors that he was indeed offered the bribe and did not solicit it, ought to be permitted to carry a Minifon on his person is a separate question from whether the recording made by the Minifon is constitutionally permissible evidence in a federal criminal trial; I take it Lopez would have no standing to challenge the use of such recordings save in a prosecution or other proceeding against him. And whether it is unfair for the Government to introduce electronic evidence without putting the human agent of transmission on the stand seems to me to implicate considerations which have nothing to do with the principle of individual freedom enshrined in the Fourth Amendment. On Lee's trial may well have been less fair than Lopez' because of the withholding of the government informer as a witness. But the invasion of freedom was in both cases the same: the secret electronic transmission or recording of private communications, Lopez' to Davis and On Lee's to the undercover agent.
II.
51
If On Lee and the instant case are in principle indistinguishable, the question of the continued validity of the Court's position in On Lee is inescapably before us. But we cannot approach the question properly without first clearing away another bit of underbrush: the suggestion that the right of privacy is lost not by the speaker's giving verbal form to his secret thoughts, but by the auditor's consenting to an electronic transcription of the speaker's words. The suggestion is an open invitation to law enforcement officers to use cat's-paws and decoys in conjunction with electronic equipment, as in On Lee. More important, it invokes a fictive sense of waiver wholly incompatible with any meaningful concept of liberty of communication. If a person must always be on his guard against his auditor's having authorized a secret recording of their conversation, he will be no less reluctant to speak freely than if his risk is that a third party is doing the recording. Surely high government officials are not the only persons who find it essential to be able to say things 'off the record.' I believe that there is a grave danger of chilling all private, free, and unconstrained communication if secret recordings, turned over to law enforcement officers by one party to a conversation, are competent evidence of any self-incriminating statements the speaker may have made. In a free society, people ought not to have to watch their every word so carefully.
52
Nothing in Rathbun v. United, States, 355 U.S. 107, 78 S.Ct. 161, 2 L.Ed.2d 134, is to the contrary. We held in that case that evidence obtained by police officers' listening in to a telephone conversation on an existing extension with the consent of one of the parties, who was also the subscriber to the extension, did not violate the federal wiretapping Act, 47 U.S.C. § 605. The decision was a narrow one. The grant of certiorari was limited to the question of statutory construction, and neither the majority nor dissenting opinion discusses any other possible basis for excluding the evidence. Furthermore, as the Court was careful to emphasize, extension phones are in common use, so common that it is a normal risk of telephoning that more than one person may be listening in at the receiver's end. The extension telephone by means of which Rathbun's statements were heard had not been specially installed for law enforcement purposes, and no attempt was made to transcribe the phone conversation electronically. Thus in the Court's view wiretapping in the conventional sense was not involved and § 605 had no application. It should also be pointed out that while it is a very serious inconvenience to be inhibited from speaking freely over the telephone, it perhaps is a far graver danger to a free society if a person is inhibited from speaking out in his home or office.2
III.
53
The question before us comes down to whether there is a legal basis, either in the Fourth Amendment or in the supervisory power,3 for excluding from federal criminal trials the fruits of surreptitious electronic surveillance by federal agents.
54
History and the text of the Constitution point the true path to the answer. In the celebrated case of Entick v. Carrington, 19 Howell's State Trials 1029 (C.P.1765), Lord Camden laid down two distinct principles: that general search warrants are unlawful because of their uncertainty; and that searches for evidence are unlawful because they infringe the privilege against self-incrimination.4 Lord Camden's double focus was carried over into the structure of the Fourth Amendment. See Lasson, The History and Development of the Fourth Amendment to the United States Constitution (1937), 103; Fraenkel, Converning Searches and Seizures, 34 Harv.L.Rev. 361, 366 (1921).5 The two clauses of the Amendment are in the conjunctive, and plainly have distinct functions. The Warrant Clause was aimed specifically at the evil of the general warrant, often regarded as the single immediate cause of the American Revolution.6 But the first clause embodies a more encompassing principle. It is, in light of the Entick decision, that government ought not to have the untrammeled right to extract evidence from people. Thus viewed, the Fourth Amendment is complementary to the Fifth. Feldman v. United States, 322 U.S. 487, 489—490, 64 S.Ct. 1082, 1083, 88 L.Ed. 1408. The informing principle of both Amendments is nothing less than a comprehensive right of personal liberty in the face of governmental intrusion.
55
And so this Court held in Boyd v. United States, 116 U.S. 616, 6 S.Ct. 524, 29 L.Ed. 746, 'a case that will be remembered as long as civil liberty lives in the United States' (Brandeis, J., dissenting in Olmstead v. United States, 277 U.S. 438, 474, 48 S.Ct. 564, 571):
56
'The principles laid down in this opinion (Entick v. Carrington) affect the very essence of constitutional liberty and security. They reach (farther) than the concrete form of the case then before the court, with its adventitious circumstances; they apply to all invasions on the part of the government and its employes of the sanctity of a man's home and the privacies of life. It is not the breaking of his doors, and the rummaging of his drawers, that constitutes the essence of the offence; but it is the invasion of his indefeasible right of personal security, personal liberty and private property, where that right has never been forfeited by his conviction of some public offense—it is the invasion of this sacred right which underlies and constitutes the essence of Lord Camden's judgment. Breaking into a house and opening boxes and drawers are circumstances of aggravation; but any forcible and compulsory extortion of a man's own testimony, or of his private papers to be used as evidence to convict him of crime, or to forfeit his goods, is within the condemnation of that judgment. In this regard the fourth and fifth amendments run almost into each other.' 116 U.S. at 630, 6 S.Ct. at 532.
57
The Court in Boyd set its face against a narrowly literal conception of 'search and seizure,' instead reading the Fourth and Fifth Amendments together as creating a broad right to inviolate personalty. Boyd itself was not a search and seizure case in the conventional sense, but involved an order to compel production of documents in the nature of a subpoena duces tecum. And Boyd had been preceded by Ex parte Jackson, 96 U.S. 727, 735, 24 L.Ed. 877, in which the Court had clearly intimated that a statute permitting government officials to open letters in the mail would violate the Fourth Amendment. See also Hoover v. McChesney, 81 F. 472 (Cir.Ct.D.Ky.1897).
58
The authority of the Boyd decision has never been impeached. Its basic principle, that the Fourth and Fifth Amendments interact to create a comprehensive right of privacy, of individual freedom, has been repeatedly approved in the decisions of this Court.7 Thus we have held that the gist of the Fourth Amendment is '(t)he security of one's privacy against arbitrary intrusion by the police.' Wolf v. Colorado, 338 U.S. 25, 27, 69 S.Ct. 1359, 1361, 93 L.Ed. 1782; Stefanelli v. Minard, 342 U.S. 117, 119, 72 S.Ct. 118, 119, 96 L.Ed. 138; Frank v. Maryland, 359 U.S. 360, 362, 79 S.Ct. 804, 806, 3 L.Ed.2d 877. Only two Terms ago, in reaffirming that the Fourth Amendment's 'right to privacy' is a 'basic constitutional right,' Mapp v. Ohio, 367 U.S. 643, 656, 81 S.Ct. 1684, 1692, 6 L.Ed.2d 1081, we remarked the "intimate relation" between the Fourth and Fifth Amendments. Id., at 657, 81 S.Ct. at 1692. So also, the Court's insistence that the Fourth Amendment is to be liberally construed, e.g., Byars v. United States, 273 U.S. 28, 32, 47 S.Ct. 248, 249, 71 L.Ed. 520; United States v. Lefkowitz, 285 U.S. 452, 464, 52 S.Ct. 420, 423, 76 L.Ed. 877; Grau v. United States, 287 U.S. 124, 53 S.Ct. 38, 77 L.Ed. 212, that searches for and seizures of mere evidence as opposed to the fruits or instrumentalities of crime are impermissible under any circumstances, e.g., United States v. Lefkowitz, supra, 285 U.S. at 464—466, 52 S.Ct. at 423; Harris v. United States, 331 U.S. 145, 154, 67 S.Ct. 1098, 1103, 91 L.Ed. 1399; Abel v. United States, 362 U.S. 217, 237—238, 80 S.Ct. 683, 696, 4 L.Ed.2d 668, and that the Fourth Amendment is violated whether the search or seizure is accomplished by force, by subterfuge, Gouled v. United States, 255 U.S. 298, 306, 41 S.Ct. 261, 263; see, e.g., Gatewood v. United States, 93 U.S.App.D.C. 226, 209 F.2d 789; Fraternal Order of Eagles v. United States, 3 Cir., 57 F.2d 93; United States v. General Pharmacal Co., D.C., 205 F.Supp. 692; United States v. Bush, D.C., 172 F.Supp. 818; United States v. Reckis, D.C., 119 F.Supp. 687; United States v. Mitchneck, D.C., 2 F.Supp. 225; but see United States v. Bush, 6 Cir., 283 F.2d 51, reversing, D.C., 172 F.Supp. 818, by an invalid subpoena, see, e.g. Hale v. Henkel, 201 U.S. 43, 76, 26 S.Ct. 370, 379; Federal Trade Commission v. American Tobacco Co., 264 U.S. 298, 44 S.Ct. 336, 68 L.Ed. 696; Brown v. United States, 276 U.S. 134, or otherwise, see e.g., Wakkuri v. United States, 6 Cir., 67 F.2d 844, is confirmation that the purpose of the Amendment is to protect individual liberty in the broadest sense from governmental intrusion. And see Poe v. Ullman, 367 U.S. 497, 549—552, 81 S.Ct. 1752, 1780—1781, 6 L.Ed.2d 989 (dissenting opinion).
59
It is against this background that we must appraise Olmstead v. United States, supra, where the Court, over the dissents of Justices Holmes, Brandeis, Stone, and Butler, held that the fruits of wiretapping by federal officers were admissible as evidence in federal criminal trials. The Court's holding, which is fully pertinent here,8 rested on the propositions that there had been no search because no trespass had been committed against the petitioners and no seizure because no physical evidence had been obtained, thus making the Fourth Amendment inapplicable; and that evidence was not inadmissible in federal criminal trials merely because obtained by federal officers by methods violative of state law or otherwise unethical.
60
When the Court first confronted the problem of electronic surveillance apart from wiretapping, olmstead was deemed to control, five members of the Court declining to reexamine the soundness of that decision. Goldman v. United States, 316 U.S. 129, 62 S.Ct. 993, 86 L.Ed. 1322. In Turn, Olmstead and Goldman were deemed to compel the result in On Lee. But cf. note 10, infra. The instant case, too, hinges on the soundness and continued authority of the Olmstead decision. I think it is demonstrable that Olmstead was erroneously decided, that its authority has been steadily sapped by subsequent decisions of the Court, and that it and the cases following it are sports in our jurisprudence which ought to be eliminated.
61
(1) Olmstead's illiberal interpretation of the Fourth Amendment as limited to the tangible fruits of actual trespasses was a departure from the Court's previous decisions, notably Boyd, and a misreading of the history and purpose of the Amendment. Such a limitation cannot be squared with a meaningful right to inviolate personal liberty. It cannot even be justified as a 'literal' reading of the Fourth Amendment. 'In every-day talk, as of 1789 or now, a man 'searches' when he looks or listens. Thus we find references in the Bible to 'searching' the Scriptures (John V, 39); in literature to a man 'searching' his heart or conscience; in the law books to 'searching' a public record. None of these acts requires a manual rummaging for concealed objects. * * * (J)ust as looking around a room is searching, listening to the sounds in a room is searching. Seeing and hearing are both reactions of a human being to the physical environment around him to light waves in one instance, to sound waves in the other. And, accordingly, using a mechanical aid to either seeing or hearing is also a form of searching. The camera and the dictaphone both do the work of the end-organs of an individual human searcher—more accurately.' United States v. On Lee, 2 Cir., 193 F.2d 306, 313 (Frank, J., dissenting).
62
(2) As constitutional exposition, moreover, the Olmstead decision is insupportable. The Constitution would be an utterly impractical instrument of contemporary government if it were deemed to reach only problems familiar to the technology of the eighteenth century; yet the Court in Olmstead refused to apply the Fourth Amendment to wiretapping seemingly because the Framers of the Constitution had not been farsighted enough to foresee the invention of the telephone.
63
(3) The Court's illiberal approach in Olmstead was a deviant in the law of the Fourth Amendment and not a harbinger of decisional revolution. The Court has not only continued to reiterate its adherence to the principles of the Boyd decision, see, e.g., Mapp v. Ohio, supra, but to require that subpoenas duces tecum comply with the Fourth Amendment, see United States v. Bausch & Lomb Optical Co., 321 U.S. 707, 727—728, 64 S.Ct. 805, 815—816, 88 L.Ed. 1024; Oklahoma Press Publishing Co. v. Walling, 327 U.S. 186, 66 S.Ct. 494, 90 L.Ed. 614; McPhaul v. United States, 364 U.S. 372, 382—383, 81 S.Ct. 138, 144, 5 L.Ed.2d 136—a requirement patently inconsistent with a grudging, narrow conception of 'searches and seizures.'
64
(4) Specifically, the Court in the years since Olmstead has severed both supports for that decision's interpretation of the Fourth Amendment. We have held that the fruits of electronic surveillance, though intangible, nevertheless are within the reach of the Amendment. Irvine v. California, 347 U.S. 128, 74 S.Ct. 381, 98 L.Ed. 561; Silverman v. United States, 365 U.S. 505, 81 S.Ct. 679, 5 L.Ed.2d 734;9 Lanza v. New York, 370 U.S. 139, 142, 82 S.Ct. 1218, 1220, 8 L.Ed.2d 384. Indeed, only the other day we reaffirmed that verbal fruits, equally with physical, are within the Fourth. Wong Sun v. United States, 371 U.S. 471, 485—486, 83 S.Ct. 407, 416—417, 9 L.Ed.2d 441. So too, the Court has refused to crowd the Fourth Amendment into the mold of local property law, Chapman v. United States, 365 U.S. 610, 617, 81 S.Ct. 776, 780, 5 L.Ed.2d 828; Jones v. United States, 362 U.S. 257, 266, 80 S.Ct. 725, 733, 4 L.Ed.2d 697; United States v. Jeffers, 342 U.S. 48, 72 S.Ct. 93, 96 L.Ed. 59; McDonald v. United States, 335 U.S. 451, 454, 69 S.Ct. 191, 192, 93 L.Ed. 153, and has expressly held, in a case very close on its facts to that at bar, that an actual trespass need not be shown in order to support a violation of the Fourth Amendment. Silverman v. United States, supra, at 511, 81 S.Ct. at 682.10
65
(5) Insofar as Olmstead rests on the notion that the federal courts may not exclude evidence, no matter how obtained, unless its admission is specifically made illegal by federal statute or by the Constitution, the decision is manifestly inconsistent with what has come to be regarded as the scope of the supervisory power over federal law enforcement. See, e.g., McNabb v. United States, 318 U.S. 332, 63 S.Ct. 608, 87 L.Ed. 819; Upshaw v. United States, 335 U.S. 410, 69 S.Ct. 170, 93 L.Ed. 100; Rea v. United States, 350 U.S. 214, 76 S.Ct. 292, 100 L.Ed. 233; Mallory v. United States, 354 U.S. 449, 77 S.Ct. 1356, 1 L.Ed.2d 1479; Morgan, The Law of Evidence, 1941—1945, 59 Harv.L.Rev. 481, 537 (1946). We are empowered to fashion rules of evidence for federal criminal trials in conformity with 'the principles of the common law as they may be interpreted * * * in the light of reason and experience.' Rule 26, Federal Rules of Criminal Procedure. Even if electronic surveillance as here involved does not violate the letter of the Fourth Amendment, which I do not concede, it violates its spirit, and we ought to devise an appropriate prophylactic rule. The Court's suggestion that the supervisory power may never be invoked to create an exclusionary rule of evidence unless there has been a violation of a specific federal law or rule of procedure is, to me, a gratuitous attempt to cripple that power. And I do not see how it can be reconciled with our mandate to fashion rules conformable to evolving common law principles.
66
(6) The Olmstead decision caused such widespread dissatisfaction that Congress in effect overruled it by enacting § 605 of the Federal Communications Act, which made wiretapping a federal crime. We have consistently given § 605 a generous construction, see Nardone v. United States, 302 U.S. 379, 58 S.Ct. 275, 82 L.Ed. 314; Weiss v. United States, 308 U.S. 321, 60 S.Ct. 269, 84 L.Ed. 298; Nardone v. United States, 308 U.S. 338, 60 S.Ct. 266, 84 L.Ed. 307; Benanti v. United States, 355 U.S. 96, 78 S.Ct. 155, 2 L.Ed.2d 126, recognizing that Congress had been concerned to prevent 'resort to methods deemed inconsistent with ethical standards and destructive of personal liberty.' Nardone (I), supra, at 383, 58 S.Ct. at 277; see Goldstein v. United States, 316 U.S. 114, 120, 62 S.Ct. 1000, 1003, 86 L.Ed. 1312. To be sure, s 605, being directed to the specific practice sanctioned by Olmstead, wiretapping, does not of its own force forbid the admission in evidence of the fruits of other techniques of electronic surveillance. But a congressional enactment is a source of judicial policy as well as a specific mandate to be enforced, and the same 'broad considerations of morality and public well-being,' Nardone (II), at 340, 60 S.Ct. at 267, which make wiretap evidence inadmissible in the federal courts equally justify a court-made rule excluding the fruits of such devices as the Minifon. It is anomalous that the federal courts, while enforcing the right to privacy with respect to telephone communications, recognize no such right with respect to communications wholly within the sanctuaries of home and office.
IV.
67
If we want to understand why the Court, in Olmstead, Goldman, and On Lee, carved such seemingly anomalous exceptions to the general principles which have guided the Court in enforcing the Fourth Amendment, we must consider two factors not often articulated in the decisions. The first is the pervasive fear that if electronic surveillance were deemed to be within the reach of the Fourth Amendment, a useful technique of law enforcement would be wholly destroyed, because an electronic 'search' could never be reasonable within the meaning of the Amendment. See Note, The Supreme Court, 1960 Term, 75 Harv.L.Rev. 40, 187 (1961). For one thing, electronic surveillance is almost inherently indiscriminate, so that compliance with the requirement of particularity in the Fourth Amendment would be difficult; for another, words, which are the objects of an electronic seizure, are ordinarily mere evidence and not the fruits or instrumentalities of crime, and so they are impermissible objects of lawful searches under any circumstances, see p. 456-457, supra; finally, the usefulness of electronic surveillance depends on lack of notice to the suspect.
68
But the argument is unconvincing. If in fact no warrant could be devised for electronic searches, that would be a compelling reason for forbidding them altogether. The requirements of the Fourth Amendment are not technical or unreasonably stringent; they are the bedrock rules without which there would be no effective protection of the right to personal liberty. A search for mere evidence offends the fundamental principle against self-incrimination, as Lord Camden clearly recognized; a merely exploratory search revives the evils of the general warrant, so bitterly opposed by the American Revolutionaries; and without some form of notice, police searches became intolerable intrusions into the privacy of home or office. Electronic searches cannot be tolerated in the name of law enforcement if they are inherently unconstitutional.
69
But in any event, it is premature to conclude that no warrant for an electronic search can possibly be devised. The requirements of the Fourth Amendment are not inflexible, or obtusely unyielding to the legitimate needs of law enforcement. It is at least clear that 'the procedure of antecedent justification before a magistrate that is central to the Fourth Amendment,' Ohio ex rel. Eaton v. Price, 364 U.S. 263, 272, 80 S.Ct. 1463, 1468, 4 L.Ed.2d 1708 (separate opinion); see McDonald v. United States, 335 U.S. 451, 455, 69 S.Ct. 191, 193, 93 L.Ed. 153; Abel v. United States, 362 U.S. 217, 251—252, 80 S.Ct. 683, 703, 4 L.Ed.2d 668 (dissenting opinion), could be made a precondition of lawful electronic surveillance. And there have been numerous suggestions of ways in which electronic searches could be made to comply with the other requirements of the Fourth Amendment.11
70
This is not to say that a warrant that will pass muster can actually be devised. It is not the business of this Court to pass upon hypothetical questions, and the question of the constitutionality of warrants for electronic surveillance is at this stage purely hypothetical. But it is important that the question is still an open one. Until the Court holds inadmissible the fruits of an electronic search made, as in the instant case, with no attempt whatever to comply with the requirements of the Fourth Amendment, there will be no incentive to seek an imaginative solution whereby the rights of individual liberty and the needs of law enforcement are fairly accommodated.
71
The second factor that may be a significant though unarticulated premise of Olmstead and the cases following it is well expressed by the Government in the instant case: 'if the agent's relatively innocuous conduct here is found offensive, a fortiori, the whole gamut of investigatorial techniques involving more serious deception must also be condemned. Police officers could then no longer employ confidential informants, act as undercover agents, or even wear 'plain clothes.' But this argument misses the point. It is not Agent Davis' deception that offends constitutional principles, but his use of an electronic device to probe and record words spoken in the privacy of a man's office. For there is a qualitative difference between electronic surveillance, whether the agents conceal the devices on their persons or in walls or under beds, and conventional police stratagems such as eavesdropping and disguise. The latter do not so seriously intrude upon the right of privacy. The risk of being overheard by an eavesdropper or betrayed by an informer or deceived as to the identity of one with whom one deals is probably inherent in the conditions of human society. It is the kind of risk we necessarily assume whenever we speak. But as soon as electronic surveillance comes into play, the risk changes crucially. There is no security from that kind of eavesdropping, no way of mitigating the risk, and so not even a residuum of true privacy. See pp. 449—451, supra.12
72
Furthermore, the fact that the police traditionally engage in some rather disreputable practices of law enforcement is no argument for their extension. Eavesdropping was indictable at common law13 and most of us would still agree that it is an unsavory practice. The limitations of human hearing, however, diminish its potentiality for harm . Electronic aids add a wholly new dimension to eavesdropping. They make it more penetrating, more indiscriminate, more truly obnoxious to a free society. Electronic surveillance, in fact, makes the police omniscient; and police omniscience is one of the most effective tools of tyranny.
V.
73
The foregoing analysis discloses no adequate justification for exception electronic searches and seizures from the requirements of the Fourth Amendment. But to state the case thus is to state it too negatively. It is to ignore the positive reasons for bringing electronic surveillance under judicial regulation. Not only has the problem grown enormously in recent years, see e.g., Todisco v. United States, 9 Cir., 298 F.2d 208; United, States v. Kabot, 2 Cir., 295 F.2d 848, but its true dimensions have only recently become apparent from empirical studies not available when Olmstead, Goldman, and On Lee were decided. The comprehensive study by Samuel Dash and his Associates as well as a number of legislative inquiries14 reveals these truly terrifying facts: (1) Electronic eavesdropping by means of concealed microphones and recording devices of various kinds has become as large a problem as wiretapping, and is pervasively employed by private detectives, police, labor spies, employers and others for a variety of purposes, some downright disreputable.15 (2) These devices go far beyond simple 'BUGGING,' AND PERMIT A DEGREE OF INVASIOn of privacy that can only be described as frightening.16 (3) Far from providing unimpeachable evidence, the devices lend themselves to diabolical fakery.17 (4) A number of States have been impelled to enact regulatory legislation.18 (5) The legitimate law enforcement need for such techniques is not clear,19 and it surely has not been established that a stiff warrant requirement for electronic surveillance would destroy effective law enforcement.
74
But even without empirical studies, it must be plain that electronic surveillance imports a peculiarly severe danger to the liberties of the person. To be secure against police officers' breaking and entering to search for physical objects is worth very little if there is no security against the officers' using secret recording devices to purloin words spoken in confidence within the four walls of home or office. Our possessions are of little value compared to our personalities. And we must bear in mind that historically the search and seizure power was used to suppress freedom of speech and of the press, see Lasson, supra, at 33, 37 50; Marcus v. Search Warrant, 367 U.S. 717, 724—729, 81 S.Ct. 1708, 1712—1714, 6 L.Ed.2d 1127; Frank v. Maryland, 359 U.S. 360, 376, 79 S.Ct. 804, 813, 3 L.Ed.2d 877 (dissenting opinion), and that today, also, the liberties of the person are indivisible. 'Under Hitler, when it became known that the secret police planted dictaphones in houses, members of families often gathered in bathrooms to conduct whispered discussions of intimate affairs, hoping thus to escape the reach of the sending apparatus.' United States v. On Lee, 2 Cir., 193 F.2d 306, 317 (dissenting opinion). Electronic surveillance strikes deeper than at the ancient feeling that a man's home is his castle; it strikes at Freedom of communication, a postulate of our kind of society. Lopez' words to Agent Davis captured by the Minifon were not constitutionally privileged by force of the First Amendment. But freedom of speech is undermined where people fear to speak unconstrainedly in what they suppose to be the privacy of home and office. King, Wire Tapping and Electronic Surveillance: A Neglected Constitutional Consideration, 66 Dick.L.Rev. 17, 25—30 (1961). If electronic surveillance by government becomes sufficiently widespread, and there is little in prospect for checking it, the hazard that as a people we may become hagridden and furtive is not fantasy.
75
The right to privacy is the obverse of freedom of speech in another sense. This Court has lately recognized that the First Amendment freedoms may include the right, under certain circumstances, to anonymity. See N.A.A.C.P. v. Alabama ex rel. Patterson, 357 U.S. 449, 78 S.Ct. 1163, 2 L.Ed.2d 1488; Bates v. Little Rock, 361 U.S. 516, 80 S.Ct. 412, 4 L.Ed.2d 480; Talley v. California, 362 U.S. 60, 80 S.Ct. 536, 4 L.Ed.2d 559; Louisiana ex rel. Gremillion v. N.A.A.C.P., 366 U.S. 293, 81 S.Ct. 1333, 6 L.Ed.2d 301; Gibson v. Florida Legislative Investigation Comm., 372 U.S. 539, 83 S.Ct. 889. The passive and the quiet, equally with the active and the aggressive, are entitled to protection when engaged in the precious activity of expressing ideas or beliefs. Electronic surveillance destroys all anonymity and all privacy; it makes government privy to everything that goes on.
76
In light of these circumstances I think it is an intolerable anomaly that while conventional searches and seizures are regulated by the Fourth and Fourteenth Amendments and wiretapping is prohibited by federal statute, electronic surveillance as involved in the instant case, which poses the greatest danger to the right of private freedom, is wholly beyond the pale of federal law.20
77
This Court has by and large steadfastly enforced the Fourth Amendment against physical intrusions into person, home, and property by law enforcement officers. But our course of decisions, it now seems, has been outflanked by the technological advances of the very recent past. I cannot but believe that if we continue to condone electronic surveillance by federal agents by permitting the fruits to be used in evidence in the federal courts, we shall be contributing to a climate of official lawlessness and conceding the helplessness of the Constitution and this Court to protect right's 'fundamental to a free society.' Frank v. Maryland, supra, 359 U.S. at 362, 79 S.Ct. at 806.21
1
18 U.S.C. § 201 provides:
'Whoever promises, offers, or gives any money or thing of value * * * to any officer or employee or person acting for or on behalf of the United States, or any department or agency thereof, in any official function * * * with intent to influence his decision or action on any question, matter, cause, or proceeding which may at any time be pending, or which may by law be brought before him in his official capacity, or in his place of trust or profit, or with intent to influence him to commit or aid in committing, or to collude in, or allow, any fraud, or make opportunity for the commission of any fraud, on the United States, or to induce him to do or omit to do any act in violation of his lawful duty, shall be fined not more than three times the amount of such money or value of such thing or imprisoned not more than three years, or both.'
2
There have been no omissions from this passage. The indicated elisions appear in the original record.
3
Count 1 also charged that the money was given to induce Davis 'to refrain * * * from computing a cabaret tax on * * * (the business of the Inn), and from reporting same to the Internal Revenue Service.'
4
'Now the law with respect to entrapment is this: if a government agent by improper means or over-bearing persuasion or wrongful conduct induces a person of ordinary firmness to commit a crime which he would not otherwise commit, then under those circumstances the defendant is to be acquitted, not because he did not do something wrongful but because he was induced to do a wrongful act which he would not otherwise have done.
'Now needless to say in all types of law enforcement, particularly with respect to matters involving certain types of regulatory statutes, it is often difficult for the government to get evidence, and government agents may properly, and without violating the law, or their duty, take such steps as make it possible to procure evidence even though such steps involve their own participation, provided that their participation is not a deliberate temptation to men of ordinary firmness, provided that they do not cause a crime to be committed by someone who does not have a criminal disposition to commit that crime.
'The burden of proof with respect to entrapment is on the defendant. And you are to ask yourself whether in fact on the evidence you heard you are presuaded by the preponderance of that evidence that Agent Davis, as it were, created the crime and the temptation, and he, Agent Davis, was the instigator and author of a crime that would never under any circumstances have taken place, had he not used unfair means.'
5
That this was the purpose of the October 21 offer is in no way inconsistent with the verdict of acquittal on Count 1. Count 1, as noted above, charged, among other things, a specific intent to induce the agent not to examine books and records, and the court in its charge attached great emphasis to the language of this count. Thus it may well have been that the acquittal on Count 1 was based solely on the jury's conclusion that the Government had not proved the existence of the specific intent beyond a reasonable doubt.
6
Petitioner claims that Davis' assertions of the existence of cabaret tax liability, and of the extent of that liability, were so recklessly false as to suggest or require a finding of entrapment. But as noted, petitioner's overtures preceded these assertions, and in any event, Davis had ample basis for believing that taxes were due, and petitioner never undertook to deny his liability during the conversation on October 24. Although Davis conceded that he may have made some errors in computation because of 'nervousness,' petitioner in his testimony made no claim that these computations led to the bribe offers.
7
Petitioner does not claim that the issue of entrapment should always be decided by the court and never submitted to the jury, and we are not now presented with that question. See Sherman v. United States, 356 U.S. 369, 78 S.Ct. 819, 2 L.Ed.2d 848; Masciale v. United States, 356 U.S. 386, 78 S.Ct. 827, 2 L.Ed. 859.
8
Rule 30 provides in pertinent part:
'No party may assign as error any portion of the charge or omission therefrom unless he objects thereto before the jury retires to consider its verdict, stating distinctly the matter to which he objects and the grounds of his objection. Opportunity shall be given to make the objection out of the hearing of the jury.'
9
The Fourth Amendment provides: 'The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.'
10
In On Lee, the defendant had been induced to make certain statements by an old acquaintance who, without the defendant's knowledge, had turned government informer and was carrying a small concealed microphone which transmitted the conversation to a narcotics agent some distance away. Thus any differences between On Lee and this case cut against the petitioner.
11
The trustworthiness of the recording is not challenged.
12
Since Agent Davis himself testified to the conversation with petitioner which was the subject matter of the recording, the question whether there may be circumstances in which the use of such recordings in evidence should be limited to purposes of 'corroboration' is not presented by this case.
1
The facts in On Lee may also have involved a right to counsel issue. The New York of Court Appeals has recently ruled that after a person has been arraigned, any statement obtained outside the presence of his counsel and without advice as to his rights is inadmissible at trial since the petitioner is entitled to the presence of counsel at every stage in the proceedings after arraignment. People v. Meyer, 11 N.Y.2d 162, 227 N.Y.S.2d 427, 182 N.E.2d 103; cf. Gideon v. Wainwright, 372 U.S. 335, 83 S.Ct. 792, 9 L.Ed.2d 799; Spano v. New York, supra, 360 U.S. p. 324, 79 S.Ct. p. 1207 (DOUGLAS, J., concurring). The statement in Meyer was made to a police officer voluntarily and without solicitation while Meyer was on bail awaiting submission of his case to the grand jury. Presumably, any agent of the prosecutor would be circumscribed by this rule whether he be a 'special employee' like Chin Poy or a patrolman on the beat.
2
Where the similar defense of entrapment has been involved, cross-examination of the government informer has invariably been critical to the defense. See Sherman v. United States, 356 U.S. 369, 371—375, 78 S.Ct. 819, 820—822. Had the Government been able to limit its case in Sherman to recordings of the final meetings between the informer and the petitioner wherein the illegal sales were consummated, the record would never have revealed the long series of meetings inducing the petitioner to make these sales. The officers in charge were apparently unaware they had ever taken place. 356 U.S. at 374—375, 78 S.Ct. at 821—822.
3
If a party were to show that the interests of justice in a particular case so require, the Court should consider limiting the use of evidence obtained by means of a recorder or transmitter to corroboration of a witness who was a party to the conversation in question. To so condition the use of evidence in the federal courts is clearly within the power of this Court. As the Court stated in McNabb v. United States, 318 U.S. 332, 341, 63 S.Ct. 608, 613:
'In the exercise of its supervisory authority over the administration of criminal justice in the federal courts, see Nardone v. United States, 308 U.S. 338, 341—342, 60 S.Ct. 266, 267, 268, 84 L.Ed. 307, this Court has, from the very beginning of its history, formulated rules of evidence to be applied in federal criminal prosecutions. * * * (Collecting authority.) And in formulating such rules of evidence for federal criminal trials the Court has been guided by considerations of justice not limited to the strict canons of evidentiary relevance.'
See Upshaw v. United States, 335 U.S. 410, 414—416, 69 S.Ct. 170, 172, 93 L.Ed. 100 (dissenting opinion); Rule 26, Federal Rules of Criminal Procedure. In McNabb itself, the purpose of the exclusionary rule adopted was to eliminate all incentive to engage in law enforcement practices universally condemned—use of the 'third degree' to obtain confession immediately after arrest.
1
See Burgman v. United States, 88 U.S.App.D.C. 184, 188 F.2d 637; Belfield v. Coop, 8 Ill.2d 293, 134 N.E.2d 249, 58 A.L.R.2d 1008 (1956); Boyne City, G. & A.R. Co. v. Anderson, 146 Mich. 328, 109 N.W.
429, 8 L.R.A.,N.S., 306 (1906); State v. Reyes, 209 Or. 595, 636, 308 P.2d 182, 196 (1957); Paulson v. Scott, 260 Wis. 141, 50 N.W.2d 376, 31 A.L.R.2d 706 (1951). 'The ground for receiving the testimony of the phonograph would seem to be stronger (than in the case of the telephone), since in its case there is not only proof by the human witness of the making of the sounds to be reproduced, but a reproduction by the mechanical witness of the sounds themselves.' Boyne City, G. & A.R. Co. v. Anderson, supra. See generally Annotation, Admissibility of Sound Recordings in Evidence, 58 A.L.R.2d 1024 (1958). This is to be contrasted with documents offered as evidence of past recollection recorded or present recollection revived, which have no status unless verified by a witness from his personal knowledge. 'The witness must be able now to assert that the record accurately represented his knowledge and recollection at the time. The usual phrase requires the witness to affirm that he 'knew it to be true at the time." 3 Wigmore, Evidence (3d ed. 1940), § 747. 'It follows from the nature of the purpose (present recollection revived) for which the paper is used * * * that it is in no strict sense testimony. In this respect it differs from a record of past recollection, which is adopted by the witness as the embodiment of his testimony and, as thus adopted, becomes his present evidence * * *.' 3 id., § 763. It is to be noted that in both cases the documents come in only on the strength of the witness' testimony.
2
If anything, Rathbun supports the position that the right of privacy is not forfeited merely because the auditor authorizes electronic eavesdropping. The Court might have grounded its decision in the fact that the receiver had consented to the police officers' listening in; since § 605 proscribes only unauthorized interceptions of telephonic communications, the Court could have held that the listening in was authorized, but it did not, turning the case entirely on the absence of interception within the meaning of the statute, and carefully differentiating between use of an existing extension phone and other modes of listening in. Thus the concession in Rathbun which the Court today quotes was pure dictum.
3
The failure of Lopez or his counsel to raise or argue the supervisory-power point does not bar us from considering it. For the interest secured by the exercise of the power is that of the federal courts themselves, not of the parties. '(T)he objection that the plaintiff comes with unclean hands will be taken by the court itself. It will be taken despite the wish to the contrary of all the parties to the litigation. The court protects itself.' Olmstead v. United States, 277 U.S. 438, 485, 48 S.Ct. 564, 575, 72 L.Ed. 944 (Brandeis, J., dissenting). (Footnote omitted.)
4
'It is very certain, that the law obligeth no man to accuse himself; because the necessary means of compelling self-accusation, falling upon the innocent as well as the guilty, would be both cruel and unjust; and it should seem, that search for evidence is disallowed upon the same principle.' 19 Howell's State Trials, at 1073.
5
The text of the Fourth Amendment is as follows: 'The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.'
6
'Historically we are dealing with a provision of the Constitution which sought to guard against an abuse that more than any one single factor gave rise to American independence. John Adams surely is a competent witness on the causes of the American Revolution. And he it was who said of Otis' argument against search by the police * * * 'American independence was then and there born.' 10 Adams, Works 247.' Harris v. United States, 331 U.S. 145, 159, 67 S.Ct. 1098, 1105, 91 L.Ed. 1399 (dissenting opinion).
Of course, the Warrant Clause not only outlaws general warrants, but also establishes the root principle of judicial superintendence of searches and seizures. See p. 464, infra.
7
E.g., Bram v. United States, 168 U.S. 532, 543—544, 18 S.Ct. 183, 187, 42 L.Ed. 568; Hale v. Henkel, 201 U.S. 43, 71, 26 S.Ct. 370, 377, 50 L.Ed. 652; Weeks v. United States, 232 U.S. 383, 34 S.Ct. 341, 58 L.Ed. 652; Gouled v. United States, 255 U.S. 298, 306, 41 S.Ct. 261, 263, 65 L.Ed. 647; Amos v. United States, 255 U.S. 313, 41 S.Ct. 266, 65 L.Ed. 654; Agnello v. United States, 269 U.S. 20, 33—34, 46 S.Ct. 4, 6—7, 70 L.Ed. 145; McGuire v. United States, 273 U.S. 95, 99, 47 S.Ct. 259, 260, 71 L.Ed. 556; United States v. Lefkowitz, 285 U.S. 452, 467, 52 S.Ct. 420, 424, 76 L.Ed. 877; Feldman v. United States, supra, 322 U.S. at 489—490, 64 S.Ct. at 1083; Davis v. United States, 328 U.S. 582, 587, 66 S.Ct. 1256, 1258, 90 L.Ed. 1453; Zap v. United States, 328 U.S. 624, 628, 66 S.Ct. 1277, 1279, 90 L.Ed. 1477.
The Court's liberal construction of the Fourth is paralleled by its similarly liberal construction of the Fifth. See, e.g., Counselman v. Hitchcock, 142 U.S. 547, 562, 12 S.Ct. 195, 197, 35 L.Ed. 1110.
8
In part, the Court rested its decision on considerations thought peculiar to wiretapping, i.e., the interception of telephonic communications. 'the language of the amendment cannot be extended and expanded to include telephone wires, reaching to the whole world from the defendant's house or office. The intervening wires are not part of his house or office, any more than are the highways along which they are stretched.' 277 U.S. at 465, 48 S.Ct. at 568. 'The reasonable view is that one who installs in his house a telephone instrument with connecting wires intends to project his voice to those quite outside, and that the wires beyond his house, and messages while passing over them, are not within the protection of the Fourth Amendment. Here those who intercepted the projected voices were not in the house of either party to the conversation.' Id., at 466, 48 S.Ct. at 568.
The disingenuous artificiality of this analysis is surely plain. Although, arguably, face-to-face conversations in home or office are more intimately a part of the right to privacy than are telephonic conversations, see p. 452-453, supra, any attempt to draw a constitutional distinction would ignore the plain realities of modern life, in which the telephone has assumed an indispensable role in free human communication.
9
In Irvine v. California, supra, though the conduct of the police was held to violate the Fourth and Fourteenth Amendments, the fruits were deemed admissible under the rule of Wolf v. Colorado, supra, overruled in Mapp v. Ohio, supra. It might be noted that the holdings in Irvine and Silverman, insofar as they brought verbal fruits within the Fourth Amendment, were implicit in Silverthorne Lumber Co. v. United States, 251 U.S. 385, 392, 40 S.Ct. 182, 183, 64 L.Ed. 319, where it was held that all fruits of an unconstitutional search must be excluded from the federal courts, so as not to 'reduce the Fourth Amendment to a form of words.' Cf. McDonald v. United States, 335 U.S. 451, 69 S.Ct. 191, 93 L.Ed. 153; Nueslein v. District of Columbia, 73 App.D.C. 85, 115 F.2d 690.
10
Silverman involved the penetration of a 'spike mike' several inches into the party wall of the house occupied by the petitioners. The mike touched a heating duct which acted as a conductor of sounds within the house, thus enabling their transmission by the mike to federal officers on the other side of the wall. On its facts the case was very close to Goldman, which had involved a detectaphone placed against and touching (but not penetrating) the outside of a wall. Since the Court in Silverman declined to distinguish the cases on the ground that Silverman did, and Goldman did not, involve an actual trespass, it would seem that the authority of Goldman was severely impaired—and so also, it would seem, that of On Lee and Olmstead.
Actually, the instant case and On Lee, compared with Goldman and Silverman, are a fortiori for applying the Fourth Amendment:
'This Court has held generally that, in a federal criminal trial, a federal officer may testify to what he sees or hears take place within a house or room which he has no warrant or permission to enter, provided he sees or hears it outside of those premises. * * * This holds true even where the officer supplements his hearing with a hearing aid, detectaphone or other device outside the premises. * * * He and his hearing aid pick up the sounds outside of, rather than within, the protected premises. * * *
'In the instant case (On Lee). * * * Lee's overhearing of petitioner's statements was accomplished through Chin Poy's surreptitious introduction, within petitioner's laundry, of Lee's concealed radio transmitter which, without petitioner's knowledge or consent, there picked up petitioner's conversation and transmitted it to Lee outside the premises. The presence of the transmitter, for this purpose, was the presence of Lee's ear. * * * In this case the words were picked up without warrant or consent within the constitutionally inviolate 'house' of a person entitled to protection there against unreasonable searches and seizures * * *.' On Lee v. United States, 343 U.S. 747, 766—767, 72 S.Ct. 967, 977—978 (Burton, J., dissenting).
11
See, e.g., Goldman v. United States, 316 U.S. 129, 140, n. 6, 62 S.Ct. 993, 998 (Murphy, J., dissenting); cf. 8 Wigmore, Evidence (McNaughton rev. ed. 1961), § 2184b(3), at 59; Westin, The Wire-Tapping Problem: An Analysis and a Legislative Proposal, 52 Col.L.Rev. 165, 200—208 (1952).
12
This is not to say that the Fourth Amendment must necessarily embrace every situation involving electronic recording aids to law enforcement. For example, a distinction might be drawn between surveillance of home or office on the one hand, and surveillance of public places, streets, and so forth, on the other hand. Compare McDonald v. United States, 335 U.S. 451, 69 S.Ct. 191, with Hester v. United States, 265 U.S. 57, 44 S.Ct. 445, 68 L.Ed. 898.
13
'Eaves-droppers, or such as listen under walls or windows or the eaves of a house, to hearken after discourse, and thereupon to frame slanderous and mischievous tales, are a common nuisance and presentable at the court-leet: or are indictable at the sessions, and punishable by fine and finding sureties for their good behaviour.' 4 Blackstone Commentaries 168. See Ga.Code Ann. § 26—2001; N.D.Cent.Code § 12—42—05; S.C.Code § 16—554.
14
Dash, Schwartz, and Knowlton, The Eavesdroppers (1959); Hearings on S. Res. No. 234 before the Subcommittee on Constitutional Rights of the Senate Committee on the Judiciary 85th Cong., 2d Sess. passim (1958); Report of the California Senate Judiciary Committee on the Interception of Messages by the Use of Electronic and Other Devices (1957); Report of the New York Joint Legislative Committee to Study Illegal Interception of Communications, N.Y.Sess.Laws (1956).
15
See Dash, supra, note 14, at 76 ('bugging' by police of interrogation rooms, jail cells, and interview rooms in jails), 96 (monitoring of employees' conversations by means of microphones concealed in pen sets), 136 (use of microphones by law enforcement officers termed 'universal' in New Orleans and Baton Rouge), 175 (in California, '(b)ugging is much more frequently and openly engaged in by police than wiretapping'), 180 (again in California: 'Literally, whenever the police suspected an individual of being connected with the commission of a crime, and the case was worth it, trained police technicians, or private specialists employed by the police, would pry open windows, pick locks, or by some ruse gain entry to the home or business place of the suspected individual and plant a microphone for the purpose of overhearing his conversations. By means of a leased wire from the telephone company, these planted microphones could be connected to telephone lines which would be drawn in to a single listening post where a great number of conversations in different parts of the city could be monitored at one time and in one place'), 190 (use of concealed microphone for purposes of blackmail), 196 (bugging conversations between busbands and wives in jails), 212 ('tables have been bugged in a restaurant for the purpose, according to the proprietor, of permitting him to know what his customers actually think of his food and to detect discourtesy among his waitresses'), 229—230 (use of bugging to obtain evidence for divorce proceedings), 269—271 (wiretapping and bugging of labor controversies in Philadelphia), 280—281 (in Las Vegas: 'A bug is put in a visiting hoodlum's hotel room as a matter of course, to see what he is up to'). These are, of course, only a few isolated examples of the practice; see, e.g., The Wall Street Journal, April 9, 1963, p. 1, col. 4; p. 22, col. 3.
16
Dash suggests that a parabolic microphone (which concentrates sound much as a curved mirror focuses light) might pick up a conversation at a distance of 100 feet. P. 350. Such a microphone can be made virtually impossible to detect, p. 353, but even the ordinary concealed microphone in the home may be impossible to detect, at least without a mine detector. P. 342. Dash also suggests that a microwave-beam device may have been developed with a range of 1,000 feet or more and ability to penetrate through virtually any obstacle. Pp. 357—358. Such a device, if it exists, is not readily obtainable; but the parabolic microphone and a variety of other such devices are. Thus a current advertisement in a national maganzine for 'The Snooper' describes this device as follows: 'This is literally an electronic marvel that's a direct result of the space age. Incredible as it may seem, it does amplify sound 1,000,000 times. Sensitive 18 disk reflector will pick up normal conversations at a distance (500 ft.) where you can't even see lips moving. Just think of the ways you can use this. Portable; complete with tripod and stethescopic earphones. The best part—a regular tape recorder can be plugged into the back to take everything down. Have fun!' The advertised price is $18.95.
17
'In a carefully controlled experiment, Samuel Dash made a sample political speech on tape. A sound studio specializing a tape editing for one of the large broadecasting studios then took this tape and edited it in such a way as completely to reverse its meaning. Finally, a third recording was made, this time of Mr. Dash reading the new, distorted version of the speech. The three recordings were compared by ear and by oscilloscope to see whether or not the editing was detectable. By ear it was noticeable only in one place where the editor had been hurried in his work. The oscilloscope could not reveal even this much because of the rapidly changing patterns on the screen. It was decided that the only way to examine the wave forms for purposes of comparison was to record them on motion-picture film; accordingly, equipment was set up for doing this. Although it was expected that the build-up or decay of sounds would be altered by cutting, so skilful had been the editorial manipulation that nothing of the kind was observed. Even after hours of studying the films, no sure clue revealing an editing job could be found.' Dash, at 368.
18
Cal.Penal Code §§ 653h, 653i; Mass.Gen.Laws Ann., c. 272, § 99; Nev.Rev.Stat. § 200.650; N.Y.Penal Law, § 738.
19
In the nature of things, wiretapping is only useful in the investigation of crimes of a continuing nature, which are typically not major crimes. '(T)he wiretapping done by plainclothesmen is still in large part aimed at bookmarkers' operations and prostitution. As a matter of fact, more wiretapping by police is done in gambling cases than in any other kind of case. In gambling and in vice matters generally, there is steady pressure on the plainclothesmen to maintain a certain arrest record. Continuous wiretap surveillance, without court order, enables plainclothesmen to maintain this record.' Dash, at 66. The same principles apply to electronic surveillance generally.
20
Senator Hennings has termed electronic eavesdropping more insidious and more prevalent than wiretapping. The Wiretapping-Eavesdropping Problem: A Legislator's View, 44 Minn.L.Rev. 813, 815 (1960). Another observer has called the problem 'far graver' than wiretapping. Williams, The Wiretapping-Eavesdropping Problem: A Defense Counsel's View, 44 Minn.L.Rev. 855, 862 (1960).
21
Viewing the instant case as I do, I find no occasion to consider the petitioner's defense of entrapment.
| 01
|
373 U.S. 410
83 S.Ct. 1349
10 L.Ed.2d 448
Elijah REED, Petitioner,v.STEAMSHIP YAKA, etc., et al.
No. 509.
Argued April 22, 1963.
Decided May 27, 1963.
Abraham E. Freedman, Philadelphia, Pa., for petitioner.
T. E. Byrne, Jr., Philadelphia, Pa., for respondents.
Mr. Justice BLACK delivered the opinion of the Court.
1
Petitioner, a longshoreman, filed a libel in rem in a United States District Court against the steamship Yaka to recover for injuries he sustained while engaged in loading the vessel. The Yaka's owner, Waterman Steamship Corporation, appeared as claimant of the ship but brought in as an additional defendant petitioner's employer, PanAtlantic Steamship Corporation, which at the time of the accident was operating Waterman's ship under a bareboat charter and whose negligence Waterman alleged caused petitioner's injury. The district judge found that at the time of the injury petitioner was in the ship standing on a stack of rectangular, wooden pallets used in loading the vessel and that the sole cause of the injury was a latent defect in one of the planks of a pallet, which caused it to break. The judge held that the defective pallet supplied by Pan-Atlantic rendered Waterman's Yaka unseaworthy and that therefore petitioner could recover against the ship. But since the defective pallet was furnished by Pan-Atlantic, the trial judge went on to hold that it must make Waterman whole because of an indemnity clause in the bareboat charter agreement. D.C., 183 F.Supp. 69. The Court of Appeals for the Third Circuit reversed the judgment, holding that neither Waterman nor Pan-Atlantic could be held personally liable for the unseaworthiness and that a libel in rem against a ship could not be sustained unless there was an underlying personal liability to support the in rem action. 3 Cir., 307 F.2d 203. Having previously reserved in Guzman v. Pichirilo, 369 U.S. 698, 700 n. 3, 82 S.Ct. 1095, 1096, 8 L.Ed.2d 205 (1962), the question of whether personal liability is essential to the liability of a ship, we granted certiorari. 371 U.S. 938, 83 S.Ct. 318, 9 L.Ed.2d 274.
2
In determining that there was no underlying personal liability for the unseaworthiness of the vessel, the Court of Appeals held that (1) Waterman, the actual owner, could not be made to respond in damages because the unseaworthiness of its ship arose after it had been demised under bareboat charter to Pan-Atlantic,1 and (2) PanAtlantic could not have been held personally liable in damages to petitioner for the unseaworthiness because Pan-Atlantic was petitioner's employer under the Longshoremen's and Harbor Workers' Compensation Act,2 and, while that Act permits actions for damages against third person,3 it provides that compensation liability of an employer under the Act is exclusive and in place of all other liability on his part.4
3
We find it unnecessary to decide whether a ship may ever be held liable for its unseaworthiness where no personal liability could be asserted because, in our view, the Court of Appeals erred in holding that Pan-Atlantic could not be held personally liable for the unseaworthiness of the ship which caused petitioner's injury.
4
Pan-Atlantic was operating the Yaka as demisee or bareboat charterer from Waterman. Under such arrangements full possession and control of the vessel are delivered up to the charterer for a period of time.5 The ship is then directed by its Master and manned by his crew; it makes his voyages and carries the cargo he chooses. Services performed on board the ship are primarily for his benefit. It has long been recognized in the law of admiralty that for many, if not most, purposes the bareboat charterer is to be treated as the owner,6 generally called owner pro hac vice. We have no doubt, and indeed Pan-Atlantic admits,7 that, barring explicit statutory exemption, the bareboat charterer is personally liable for the unseaworthiness of a chartered vessel,8 and that this liability will support a libel in rem against the vessel.9 Since the unseaworthiness of the Yaka is no longer in dispute, the only question is whether the Longshoremen's Act prevents recovery by petitioner for Pan-Atlantic's breach of its warranty of seaworthiness.
5
In Seas Shipping Co. v. Sieracki, 328 U.S. 85, 66 S.Ct. 872, 90 L.Ed. 1099 (1946), we held that a shipowner's warranty of seaworthiness extended to a longshoreman injured while loading the ship, even though the longshoreman was employed by an independent contractor. In doing so, we noted particularly the hazards of marine service, the helplessness of the men to ward off the perils of unseaworthiness, the harshness of forcing them to shoulder their losses alone, and the broad range of the 'humanitarian policy' of the doctrine of seaworthiness, which we held not to depend upon any kind of contract. 328 U.S., at 93—95, 66 S.Ct., at ,876—877. We further held that the Longshoremen's and Harbor Workers' Act was not intended to take away from longshoremen the traditional remedies of the sea, so that recovery for unseaworthiness could be had notwithstanding the availability of compensation. Ten years later, in Ryan Stevedoring Co. v. Pan-Atlantic S.S. Corp., 350 U.S. 124, 76 S.Ct. 232, 100 L.Ed. 133 (1956), we were faced with the question of whether a shipowner who was forced to pay damages to a longshoreman injured by the unsafe storage of cargo could recover indemnity from the stevedoring company for whom the longshoreman worked. Even in the absence of an indemnity provision, the Court held that the stevedoring company was liable over to the shipowner because it had promised to store the cargo safely. The Court was not convinced by arguments that its result made the economic burden of the longshoreman's recovery fall on the stevedoring employer contrary to the purpose of the Act. Thus, there can be no doubt that, if the petitioner here had been employed to do this particular work by an independent stevedoring company rather than directly by the owner, he could have recovered damages for his injury from the owner who could have then under Ryan shifted the burden of the recovery to petitioner's stevedoring employer. Yet the Court of Appeals held, and Pan-Atlantic would have us hold, that petitioner must be completely denied the traditional and basic protection of the warranty of seaworthiness simply because Pan-Atlantic was not only the owner pro hac vice of the ship but was also petitioner's employer. In making this argument, Pan-Atlantic has not pointed and could not point to any economic difference between giving relief in this case, where the owner acted as his own stevedore, and in one in which the owner hires an independent company. In either case, under Ryan, the burden ultimately falls on the company whose default caused the injury. Pan-Atlantic relies simply on the literal wording of the statute, and it must be admitted that the statute on its face lends support to Pan-Atlantic's construction. But we cannot now consider the wording of the statute alone. We must view it in the light of our case prior cases in this area, like Sieracki, Ryan, and others, the holdings of which have been left unchanged by Congress. In particular, we pointed out several times in the Sieracki case, which has been consistently followed since,10 that a shipowner's obligation of seaworthiness cannot be shifted about, limited, or escaped by contracts or by the absence of contracts and that the shipowner's obligation is rooted, not in contracts, but in the hazards of the work. And Ryan's holding that a negligent stevedoring company must indemnify a shipowner has in later cases been followed and to some degree extended.11 In the light of this whole body of law, statutory and decisional, only blind adherence to the superficial meaning of a statute could prompt us to ignore the fact that Pan-Atlantic was not only an employer of longshoremen but was also a bareboat charterer and operator of a ship and, as such, was charged with the traditional, absolute, and nondelegable obligation of seaworthiness which it should not be permitted to avoid. We have previously said that the Longshoremen's Act 'must be liberally construed in conformance with its purpose, and in a way which avoids harsh and incongruous results.'12 We think it would produce a harsh and incongruous result, one out of keeping with the dominant intent of Congress to help longshoremen,13 to distinguish between liability to longshoremen injured under precisely the same circumstances because some draw their pay directly from a shipowner and others from a stevedoring company doing the ship's service. Petitioner's need for protection from unseaworthiness was neither more nor less than that of a longshoreman working for a stevedoring company. As we said in a slightly different factual context, 'All were subjected to the same danger. All were entitled to like treatment under law.'14 We conclude that petitioner was not barred by the Longshoremen's Act from relying on Pan-Atlantic's liability as a shipowner for the Yaka's unseaworthiness in order to support his libel in rem against the vessel.
6
Reversed.
7
Mr. Justice HARLAN, whom Mr. Justice STEWART joins, dissenting.
8
This decision goes further than anything yet done by the Court in F.E.L.A. and admiralty cases (see, e.g., Rogers v. Missouri Pac. R. Co., 352 U.S. 500, 77 S.Ct. 443, 1 L.Ed.2d 493 and its offspring, and Gutierrez v. Waterman S.S. Corp., 372 U.S. 206, 83 S.Ct. 1185) to do what it considers 'justice' to those who have become the unfortunate victims of industrial accidents. For it is no exaggeration to say that in holding that a longshoreman may recover from his own employer for injuries suffered in the course of employment, the Court has effectively 'repealed' a basic aspect of the Longshoremen's and Harbor Workers' Compensation Act.
9
The violence done to the statutory scheme is most simply shown merely by quoting the relevant portions of the two provisions that govern the question before us. The first is the definition of 'employer' as:
10
'an employer any of whose employees are employed in maritime employment, in whole or in part, upon the navigable waters of the United States (including any dry dock.)' § 2(4), 44 Stat. 1425, 33 U.S.C. § 902(4).
11
The second is § 5, a provision entitled 'Exclusiveness of liability,' which states:
12
'The liability of an employer (for the compensation) prescribed in section 4 shall be exclusive and in place of all other liability of such employer to the employee * * * at law or in admiralty on account of such injury or death * * *.' 44 Stat. 1426, 33 U.S.C. § 905.
13
There being no doubt that petitioner is an 'employee' within the meaning of the Act,1 there is thus no question that he is excluded from recovering from his employer, Pan-Atlantic, in this action. Under a statute which was specifically written to include shipowners who employed their own dockworkers, and which excluded liability at law or in admiralty, there is no room for concluding that an employer shipowner can be held liable to his own longshoreman employee for unseaworthiness. Indeed, the point is so clear that petitioner has had what I would have thought was the good sense not even to argue to the contrary. (He has instead based his argument wholly on the theory that the ship itself may be liable even in the absence of any underlying personal liability on the part of anyone.)
14
While conceding that the statute 'on its face lends support' to the conclusion that neither party has challenged, the Court refuses to give what it describes as 'blind adherence to the superficial meaning' of the Act. But if exclusiveness of liability is the 'superficial' meaning, then what, may it be asked, is the 'true' congressional purpose in enacting this legislation? The statutory design was nowhere more concisely or more accurately summarized than in the dissenting opinion in Ryan Stevedoring Co. v. Pan-Atlantic S.S. Corp., 350 U.S. 124, 140, 76 S.Ct. 232, 241, 100 L.Ed. 133, where it was stated:
15
'Congress weighed the conflicting interests of employers and employees and struck what was considered to be a fair and constitutional balance. Injured employees thereby lost their chance to get large tort verdicts against their employers, but gained the right to get a sure though frequently a more modest recovery. However, § 33 did leave employees a chance to recover extra tort damages from third persons who negligently injured them. And while Congress imposed absolute liability on employers, they were also accorded counterbalancing advantages. They were no longer to be subjected to the hazards of large tort verdicts. Under no circumstances were they to be held liable to their own employees for more than the compensation clearly fixed in the Act. Thus employers were given every reason to believe they could buy their insurance and make other business arrangements on the basis of the limited Compensation Act liability.' (Footnote omitted.)
16
Congress, then, deliberately gave employers certain 'counterbalancing advantages' in exchange for imposing on them absolute liability. If these advantages are to be discarded as purely 'superficial,' then the true purpose of the statute was apparently to give an additional remedy to employees while not requiring them to relinquish any existing remedies as part of the bargain. This, of course, is precisely the opposite of what Congress explicitly aimed to do.
17
The Court is frank to admit that the real reason for its decision is that a contrary result would make little economic sense after the decision in Ryan, supra, holding that, on the basis of an implied contract of indemnity, a shipowner is entitled to reimbursement from an independent stevedore of a judgment obtained against the shipowner by the stevedore's employee. Admittedly, the liability imposed in Ryan is similar to the liability imposed on Pan-Atantic in the present case. But what is overlooked is that the Ryan result can be squared with the statute, resting as it did on the stevedoring company's voluntarily assumed contractual obligation to indemnify the third-party shipowner, while the present result cannot. Granting that petitioner could have recovered in this case for faulty equipment brought aboard by longshoremen if the ship had been operated by an independent company, cf. Alaska S.S. Co. v. Petterson, 347 U.S. 396, 74 S.Ct. 601, 98 L.Ed. 798, I believe that any anomaly between that case and this one should be left to Congress to remedy, for it may be that it would choose means wholly different from those chosen by the Court. There is an outer limit beyond which judicial construction of the language of a statute ought not go, and I respectfully submit that that limit has been exceeded here.
18
Believing that there is no basis on which recovery by petitioner can be sustained,2 I would affirm the judgment below.
1
Whether a bareboat charter absolves the owner from liability on its warranty of seaworthiness is a question we also reserved in Guzman v. Pichirilo, 369 U.S. 698, 700, 82 S.Ct. 1095, 1096, 8 L.Ed.2d 205 (1962). We do not reach that question here.
Counsel state that an in personam complaint against Waterman was disaction. missed and no appeal was taken by petitioner. But this has no relevancy here.
2
44 Stat. 1424 (1927), 33 U.S.C. §§ 901—950.
3
33 U.S.C. § 933.
4
33 U.S.C. § 905.
5
See Guzman v. Pichirilo, 369 U.S. 698, 699—700, 82 S.Ct. 1095, 1096, 8 L.Ed.2d 205 (1962), and cases there cited; Gilmore and Black, The Law of Admiralty (1957), 215.
6
See. e.g., Leary v. United States 14 Wall. 607, 610, 20 L.Ed. 756 (1872); United States v. Shea, 152 U.S. 178, 14 S.Ct. 519, 38 L.Ed. 403 (1894).
7
Pan-Atlantic states in its brief, 'Whether we call him bareboat charterer, owner pro hac vice, or demisee, it is he who 'is the warrantor of seaworthiness."
8
Cf. Cannella v. Lykes Bros. S.S. Co., 174 F.2d 794 (C.A.2d Cir., 1949); Cannella v. United States, 179 F.2d 491 (C.A.2d Cir., 1950).
9
See, e.g., Crumady v. The Joachim Hendrik Fisser, 358 U.S. 423, 79 S.Ct. 445, 3 L.Ed.2d 413 (1959).
10
See, e.g., Pope & Talbot, Inc. v. Hawn, 346 U.S. 406, 74 S.Ct. 202, 98 L.Ed. 143 (1953); Alaska S.S. Co. v. Petterson, 347 U.S. 396, 74 S.Ct. 601, 98 L.Ed. 798 (1954); Rogers v. United States Lines, 347 U.S. 984, 74 S.Ct. 849, 98 L.Ed. 1120 (1954); Crumady v. The Joachim Hendrik Fisser, 358 U.S. 423, 79 S.Ct. 445, 3 L.Ed.2d 413 (1959).
11
See, e.g., Weyerhaeuser S.S. Co. v. Nacirema Operating Co., 355 U.S. 563, 79 S.Ct. 438, 2 L.Ed.2d 491 (1958); Crumady v. The Joachim Hendrik Fisser, 358 U.S. 423, 79 S.Ct. 445, 3 L.Ed.2d 413 (1959); Waterman S.S. Corp. v. Dugan & McNamara, Inc., 364 U.S. 421, 81 S.Ct. 200, 5 L.Ed.2d 169 (1960).
12
Voris v. Eikel, 346 U.S. 328, 333, 74 S.Ct. 88, 92, 98 L.Ed. 5 (1953).
13
See S.Rep. No. 973, 69th Cong., 1st Sess. (1926); H.R.Rep. No. 1190, 69th Cong., 1st Sess. (1926).
14
Pope & Talbot, Inc. v. Hawn, 346 U.S. 406, 413, 74 S.Ct. 202, 207, 98 L.Ed. 143 (1953).
1
The Act in § 2(3), 44 Stat. 1425, 33 U.S.C. § 902(3), defines 'employee,' and excludes only masters and members of a crew and those engaged to load or unload any small vessel under 18 tons net.
2
The basis of recovery urged by petitioner is that in rem liability of the ship can exist even without any underlying personal liability. But I fully agree with the court below (cf. Guzman v. Pichirilo, 369 U.S. 698, 704, 82 S.Ct. 1095, 1098, 8 L.Ed.2d 205 (dissenting opinion)) that such a result would be a gross misapplication of a fiction whose principal modern function is as a procedural device to provide a convenient forum where none would otherwise be available. See Continental Grain Co. v. Barge FBL—585, 364 U.S. 19, 23—24, 80 S.Ct. 1470, 1473, 4 L.Ed.2d 1540. The reasons against its application to create substantive liability were eloquently stated by Mr. Justice Bradley, speaking for the Court in City of Norwich, 118 U.S. 468, 503, 6 S.Ct. 1150, 1162, 30 L.Ed. 134: 'To say that an owner is not liable, but that his vessel is liable, seems to us like talking in riddles. * * * In the matter of liability, a man and his property cannot be separated * * *.'
The Court also suggests that there may be another basis for recovery that is not reached apparently on the ground that it was not properly preserved: that Waterman, the demisor, was not absolved by the making of a bareboat charter from liability for unseaworthiness arising after the demise. I see no procedural barrier to consideration of this theory as possible support for petitioner's recovery against the ship, but I do not believe it can be sustained on its merits. I agree with the court below, and with the Court of Appeals for the Second Circuit, see Grillea v. United States, 229 F.2d 687, 690, that a demisor should not be held liable for unseaworthiness resulting solely from the equipment brought on board by the demisee's employees. An analogy may concededly be drawn to this Court's holding in Alaska S.S. Co. v. Petterson, supra, relating to the shipowner's liability for equipment brought on board by a stevedore, but I would not extend that one-sentence 6—3 per curiam decision beyond its precise facts. Cf. Gutierrez, v. Waterman S.S. Corp., 373 U.S., at 216, 83 S.Ct., at 1191 (dissenting opinion).
| 78
|
373 U.S. 723
83 S.Ct. 1417
10 L.Ed.2d 663
Wilbert RIDEAU, Petitioner,v.STATE OF LOUISIANA.
No. 630.
Argued April 29, 1963.
Decided June 3, 1963.
Fred H. Sievert, Jr., Lake Charles, La., for petitioner.
Frank T. Salter, Jr., Lake Charles, La., for respondent.
Mr. Justice STEWART delivered the opinion of the Court.
1
On the evening of February 16, 1961, a man robbed a bank in Lake Charles, Louisiana, kidnapped three of the bank's employees, and killed one of them A few hours later the petitioner, Wilbert Rideau, was apprehended by the police and lodged in the Calcasieu Parish jail in Lake Charles. The next morning a moving picture film with a sound track was made of an 'interview' in the jail between Rideau and the Sheriff of Calcasieu Parish. This 'interview' lasted approximately 20 minutes. It consisted of interrogation by the sheriff and admissions by Rideau that he had perpetrated the bank robbery, kidnapping, and murder. Later the same day the filmed 'interview' was broadcast over a television station in Lake Charles, and some 24,000 people in the community saw and heard it on television. The sound film was again shown on television the next day to an estimated audience of 53,000 people. The following day the film was again broadcast by the same television station, and this time approximately 20,000 people saw and heard the 'interview' on their television sets. Calcasieu Parish has a population of approximately 150,000 people.
2
Some two weeks later, Rideau was arraigned on charges of armed robbery, kidnapping, and murder, and two lawyers were appointed to represent him. His lawyers promptly filed a motion for a change of venue, on the ground that it would deprive Rideau of rights guaranteed to him by the United States Constitution to force him to trial in Calcasieu Parish after the three television broadcasts there of his 'interview' with the sheriff.1 After a hearing, the motion for change of venue was denied, and Rideau was accordingly convicted and sentenced to death on the murder charge in the Calcasieu Parish trial court.
3
Three members of the jury which convicted him had stated on voir dire that they had seen and heard Rideau's televised 'interview' with the sheriff on at least one occasion. Two members of the jury were deputy sheriffs of Calcasieu Parish. Rideau's counsel had requested that these jurors be excused for cause, having exhausted all of their peremptory challenges, but these challenges for cause had been denied by the trial judge. The judgment of conviction was affirmed by the Supreme Court of Louisiana, 242 La. 431, 137 So.2d 283, and the case is here on a writ of certiorari, 371 U.S. 919, 83 S.Ct. 294, 9 L.Ed.2d 229.
4
The record in this case contains as an exhibit the sound film which was broadcast. What the people of Calcasieu Parish saw on their television sets was Rideau, in jail, flanked by the sheriff and two state troopers, admitting in detail the commission of the robbery, kidnapping, and murder, in response to leading questions by the sheriff.2 The record fails to show whose idea it was to make the sound film, and broadcast it over the local television station, but we know from the conceded circumstances that the plan was carried out with the active cooperation and participation of the local law enforcement officers. And certainly no one has suggested that it was Rideau's idea, or even that he was aware of what was going on when the sound film was being made.
5
In the view we take of this case, the question of who originally initiated the idea of the televised interview is, in any event, a basically irrelevant detail. For we hold that it was a denial of due process of law to refuse the request for a change of venue, after the people of Calcasieu Parish had been exposed repeatedly and in depth to the spectacle of Rideau personally confessing in detail to the crimes with which he was later to be charged. For anyone who has ever watched television the conclusion cannot be avoided that this spectacle, to the tens of thousands of people who saw and heard it, in a very real sense was Rideau's trial—at which he pleaded guilty to murder. Any subsequent court proceedings in a community so pervasively exposed to such a spectacle could be but a hollow formality.
6
In Brown v. Mississippi, 297 U.S. 278, 56 S.Ct. 461, 80 L.Ed. 682, this Court set aside murder convictions secured in a state trial with all the formalities of fair procedures, based upon 'free and voluntary confessions' which in fact had been preceded by grossly brutal kangaroo court proceedings while the defendants were held in jail without counsel. As Chief Justice Hughes wrote in that case, 'The state is free to regulate the procedure of its courts in accordance with its own conceptions of policy * * *. (But) it does not follow that it may substitute trial by ordeal.' 297 U.S., at 285, 56 S.Ct., at 464. Cf. White v. Texas, 310 U.S. 530, 60 S.Ct. 1032, 84 L.Ed. 1342. That was almost a generation ago, in an era before the onrush of an electronic age.
7
The case now before us does not involve physical brutality. The kangaroo court proceedings in this case involved a more subtle but no less real deprivation of due process of law. Under our Constitution's guarantee of due process, a person accused of committing a crime is vouchsafed basic minimal rights. Among these are the right to counsel,3 the right to plead not guilty, and the right to be tried in a courtroom presided over by a judge. Yet in this case the people of Calcasieu Parish saw and heard, not once but three times, a 'trial' of Rideau in a jail, presided over by a sheriff, where there was no lawyer to advise Rideau of his right to stand mute.
8
The record shows that such a thing as this never took place before in Calcasieu Parish, Louisiana.4 Whether it has occurred elsewhere, we do not know. But we do not hesitate to hold, without pausing to examine a particularized transcript of the voir dire examination of the members of the jury, that due process of law in this case required a trial before a jury drawn from a community of people who had not seen and heard Rideau's televised 'interview.' 'Due process of law, preserved for all by our Constitution, commands that no such practice as that disclosed by this record shall send any accused to his death.' Chambers v. Florida, 309 U.S. 227, 241, 60 S.Ct. 472, 479, 84 L.Ed. 716.
9
Reversed.
10
Mr. Justice CLARK, with whom Mr. Justice HARLAN joins, dissenting.
11
On the evening of February 16, 1961, the petitioner, Wilbert Rideau, was arrested and confined in the Calcasieu Parish jail in Lake Charles, Louisiana. The arrest arose out of a bank robbery and a subsequent kidnapping and homicide. On the night of his arrest petitioner made detailed oral and written confessions to the crimes, and on the following morning a sound film was made of an interview between the sheriff and petitioner in which he again admitted commission of the crimes. The film was broadcast on a local television station on February 17, 18, and 19, 1961.
12
On March 3, 1961, petitioner was arraigned on charges of armed robbery, kidnapping and murder. As required under the law of Louisiana, he pleaded not guilty to the two capital crimes, but he entered a plea of guilty to the charge of armed robbery. Counsel were appointed immediately, and they requested permission to withdraw the plea of guilty to armed robbery, which motion was granted. They then filed a motion to quash, and the State was required to elect under which count it wished to proceed. The State elected the murder count, and the trial was set for April 10, 1961.
13
The defense moved for a change of venue, which was denied after hearing. Thereupon a jury was empaneled and petitioner was tried and convicted of murder. The Louisiana Supreme Court affirmed and this Court now reverses that judgment, holding that the denial of petitioner's motion for change of venue was a deprivation of due process of law. Having searched the Court's opinion and the record, I am unable to find any deprivation of due process under the Fourteenth Amendment and I therefore dissent.
14
At the outset, two matters should be clearly established. First, I do not believe it within the province of law enforcement officers actively to cooperate in activities which tend to make more difficult the achievement of impartial justice. Therefore, if this case arose in a federal court, over which we exercise supervisory powers, I would vote to reverse the judgment before us. Cf. Marshall v. United States, 360 U.S. 310, 79 S.Ct. 1171, 3 L.Ed.2d 1250 (1959). It goes without saying, however, that there is a very significant difference between matters within the scope of our supervisory power and matters which reach the level of constitutional dimension. See, e.g., Stein v. People of State of New York, 346 U.S. 156, 187, 73 S.Ct. 1077, 1094, 97 L.Ed. 1522 (1953); Brown v. Allen, 344 U.S. 443, 476, 73 S.Ct. 397, 417, 97 L.Ed. 469 (1953).
15
Second, I agree fully with the Court that one is deprived of due process of law when he is tried in an environment so permeated with hostility that judicial proceedings can be 'but a hollow formality.' This proposition, and my position with regard thereto, are established in Irvin v. Dowd, 366 U.S. 717, 81 S.Ct. 1639, 6 L.Ed.2d 751 (1961). At this point I must part company with the Court, however, not so much because it deviates from the principles established in Irvin but because it applies no principles at all. It simply stops at this point, without establishing any substantial nexus between the televised 'interview' and petitioner's trial, which occurred almost two months later. Unless the adverse publicity is shown by the record to have fatally infected the trial, there is simply no basis for the Court's inference that the publicity, epitomized by the televised interview, called up some informal and illicit analogy to res judicata, making petitioner's trial a meaningless formality. See Beck v. Washington, 369 U.S. 541, 82 S.Ct. 955, 8 L.Ed.2d 98 (1962).
16
That the Court apparently does not realize the necessity of establishing this nexus is illustrated by its reliance on Brown v. Mississippi, 297 U.S. 278, 56 S.Ct. 461, 80 L.Ed. 682 (1936). That case and its progeny* stand for the proposition that one may not constitutionally be convicted of a crime upon evidence including a confession involuntarily made. There can be no more clear nexus between the action of state officials before trial and the trial itself than when the results of that action are admitted in evidence at the trial. Here, of course, neither the filmed interview nor any transcript of it was shown or read to the jury. While the oral and written confessions made on the night of the arrest were admitted in evidence, the only argument for their exclusion made by the petitioner is that they were obtained at an interrogation when he had not been advised of his right to counsel and did not have counsel present. That argument is clearly answered by our decisions in Cicenia v. Lagay, 357 U.S. 504, 78 S.Ct. 1297, 2 L.Ed.2d 1523 (1958), and Crooker v. California, 357 U.S. 433, 78 S.Ct. 1287, 2 L.Ed.2d 1448 (1958).
17
The fact that the adverse publicity was not evidence in the case is not controlling, however, for we have recognized that such matter may, in unusual circumstances, fatally infect a trial when it enters the courtroom indelibly imbedded in the minds of the jurors. We found such a situation in Irvin v. Dowd, supra, where the continuous wave of publicity concerning the offense and the past record of the petitioner so permeated the area where he was tried that
18
'(a)n examination of the 2,783-page voir dire record shows that 370 prospective jurors or almost 90% of those examined on the point * * * entertained some opinion as to guilt ranging in intensity from mere suspicion to absolute certainty. A number admitted that, if they were in the accused's place in the dock and he in theirs on the jury with their opinions, they would not want him on a jury.' 366 U.S., at 727, 81 S.Ct., at 1645.
19
More important, of the 12 jurors finally placed in the jury box eight thought petitioner Irvin to be guilty. In view of those circumstances we unanimously reversed the judgment in that case, with the caveat that
20
'It is not required, however, that the jurors be totally ignorant of the facts and issues involved. In these days of swift, widespread and diverse methods of communication, an important case can be expected to arouse the interest of the public in the vicinity, and scarcely any of those best qualified to serve as jurors will not have formed some impression or opinion as to the merits of the case. This is particularly true in criminal cases. To hold that the mere existence of any preconceived notion as to the guilt or innocence of an accused, without more, is sufficient to rebut the presumption of a prospective juror's impartiality would be to establish an impossible standard.' Id., at 722—723, 81 S.Ct., at 1642.
21
Thus, in Irvin, because of the complete permeation, imbedding opinions of guilt in the minds of 90% of the veniremen and two-thirds of the actual jury, we held that petitioner had been deprived of his constitutional right to an impartial tribunal. Compare Beck v. Washington, supra. We now face the question whether this is such a situation and, for that determination, we must examine the publicity involved, the hearing on the motion for change of venue and the record of the voir dire examination.
22
Initially, we face an obstacle in determining the pervasiveness of the televised interview, since the circulation of a television program is less susceptible of determination than that of a newspaper. The figures quoted by the Court as representing the number of people who 'saw and heard' the interview were given by the Program Director of the television station and represented the typical number of viewers at the times when the interview was broadcast, as determined by a rating service which had conducted a sampling some months previous to the broadcasts. The Director testified that those figures represented 'an approximate number and, as I say, there is no way you can prove this because communications is an intangible business * * *.' Of course, assuming arguendo the accuracy of the figures given, there is no way of determining whether those figures are mutually inclusive or whether they represent different viewers on the different occasions. The record does give a more tangible indication of the effect of the publicity, however, in the hearing on the motion for change of venue. At that hearing five witnesses testified that, in their opinions, petitioner could not get a fair trial in the parish. Twenty-four witnesses testified that, in their opinions, petitioner could get a fair trial and a stipulation was entered that five more witnesses would testify that he could get a fair trial in the parish.
23
The most crucial evidence relates to the composition of the 12-man jury. Of the 12 members of the panel only three had seen the televised interview which had been shown almost two months before the trial. The petitioner does not assert, and the record does not show, that these three testified to holding opinions of petitioner's guilt. They did testify, however, that they
24
'could lay aside any opinion, give the defendant the presumption of innocence as provided by law, base their decision solely upon the evidence, and apply the law as given by the court. As the judge stated in his per curiam: 'They testified they could do so notwithstanding anything they may have heard, seen or read of the case." 242 La. 431, 462, 137 So.2d 283, 295.
25
Further, two members of the jury held honorary Deputy Sheriff's commissions from the Sheriff's department. Neither of these men was in any way connected with the department as a deputy, neither had ever made any arrests and neither had ever received any pay from the department. They both testified that they used the honorary commissions only for their convenience. They testified that these honorary commissions would not affect their ability to serve as jurors in any way, and the trial judge concluded that this tenuous relationship with the State did not destroy their qualifications to serve. Cf. Frazier v. United States, 335 U.S. 497, 69 S.Ct. 201, 93 L.Ed. 187 (1948); United States v. Wood, 299 U.S. 123, 57 S.Ct. 177, 81 L.Ed. 78 (1936).
26
The right to a trial before a fair and impartial tribunal 'is a basic requirement of due process,' In re Murchison, 349 U.S. 133, 136, 75 S.Ct. 623, 625, 99 L.Ed. 942 (1955), and must be safeguarded with vigilance. As we recognized in Irvin, however, it is an impossible standard to require that tribunal to be a laboratory, completely sterilized and freed from any external factors. The determination of impartiality, in which demeanor plays such an important part, is particularly within the province of the trial judge. And when the jurors testify that they can discount the influence of external factors and meet the standard imposed by the Fourteenth Amendment, that assurance is not lightly to be discarded. When the circumstances are unusually compelling, as in Irvin, the assurances may be discarded, but 'it is not asking too much that the burden of showing essential unfairness be sustained by him who claims such injustice and seeks to have the result set aside * * *.' Adams v. United States ex rel. McCann, 317 U.S. 269, 281, 63 S.Ct. 236, 242, 87 L.Ed. 268 (1942). Since the petitioner clearly has not met that burden, I would affirm the judgment before us.
1
The motion stated: 'That to require the Defendant to be tried on the charges which have been preferred against him in the Parish of Calcasieu, would be a travesty of justice as would be a violation to the Defendant's rights for a fair and impartial trial, which is guaranteed to every person accused of having committed a crime by the Constitution of the State of Louisiana and by the Constitution of the United States.'
2
The Supreme Court of Louisiana summarized the event as follows: '(O)n the morning of February 17, 1961, the defendant was interviewed by the sheriff, and the entire interview was filmed (with a sound track) and shown to the audience of television station KPLC—TV on three occasions. The showings occurred prior to the arraignment of defendant on the murder charge. In this interview the accused admitted his part in the crime for which he was later ndicted.' 242 La., at 447, 137 So.2d, at 289.
3
Gideon v. Wainwright, 372 U.S. 335, 83 S.Ct. 792, 9 L.Ed.2d 799.
4
'Q. Mr. Mazilly, you have been in police work roughly 21 years?
'A. Yes, sir.
'Q. Were you in court yesterday at the time a sound on film picture was shown to the court which had been shown on KPLC—TV encompassing an interview between Sheriff Reid and Rideau?
'A. I was.
'Q. In all of your 21 years, do you know of any similar case in this parish or Southwest Louisiana where a man charged with a capital crime was allowed—that pictures were made of him and the general public was shown the pictures and a sound track in which he confessed to a capital crime?
'A. No, sir.'
*
See Ritz, Twenty-five Years of State Criminal Confession Cases in the U.S. Supreme Court, 19 Wash. & Lee L.Rev. 35 (1962).
| 01
|
373 U.S. 701
83 S.Ct. 1429
10 L.Ed.2d 646
LOCAL NO. 207, INTERNATIONAL ASSOCIATION OF BRIDGE, STRUCTURAL AND ORNAMENTAL IRON WORKERS UNION, et al., Petitioners,v.Jacob PERKO.
No. 482.
Argued April 23 and 24, 1963.
Decided June 3, 1963.
David E. Feller, Washington, D.C., for petitioners.
Martin S. Goldberg, Youngstown, Ohio, for respondent.
Mr. Justice HARLAN delivered the opinion of the Court.
1
This case, involving a suit by a union member against a local union, raises issues of federal preemption similar to those considered in Local 100, United Assn. of Journeymen v. Borden, 373 U.S. 690, 83 S.Ct. 1423.
2
In the present case the respondent, Jacob Perko, filed a complaint in a state court against Local 207 of the International Association of Bridge, Structural and Ornamental Iron Workers Union and certain of its officers, petitioners here, seeking damages under state common law. He alleged that for several years he had been a member in good standing of the iron workers local and had been employed 'as a foreman' by the William B. Pollock Company; that the defendants without justification had conspired to deprive him of the right to continue to work 'as a foreman'; that pursuant to this conspiracy they had demanded that the company discharge him from his duties 'as superintendent and foreman'; that as a result he had been discharged, and defendants had since prevented him from obtaining work 'as a foreman in ironwork by representing that plaintiff's foreman's rights had been suspended'; and that he was entitled to damages for past and future loss of earnings in the amount of $75,000.
3
An order of the trial court that the complaint be dismissed was reversed by the Supreme Court of Ohio and the case remanded for trial, 168 Ohio St. 161, 151 N.E.2d 742. The court disposed of the union's argument that Perko had failed to exhaust internal union remedies by noting that:
4
'Plaintiff is not attempting to secure any redress for loss of rights as a member of the union * * *. He is alleging that the union to which he belonged and certain named officials thereof committed a common-law tort against him by conspiring to deprive him of his right to earn a living and interfering with his contract of employment * * *.' 168 Ohio St., at 162, 151 N.E.2d, at 744.
5
In answer to the union's argument that federal law precluded the exercise of state jurisdiction, the court stated that there was no federal preemption with regard to a state action 'to recover damages for a common-law tort, which is also an unfair labor practice', citing International Assn. of Machinists v. Gonzales, 356 U.S. 617, 78 S.Ct. 923, 2 L.Ed.2d 1018.
6
At trial, a verdict was directed for petitioners, but this ruling was reversed on appeal, and a second trial was held. The evidence at this trial showed that Perko had generally worked for the company as a 'foreman' or 'superintendent';1 that in December 1953 he was working as a superintendent on a particular project; that in that capacity he gave instructions to boilermakers with respect to performance of certain phases of the work that the iron workers claimed; and that following this incident Perko was charged by members of petitioner local with assisting boilermakers in violation of the union's rule2 and was found guilty, fined and suspended from membership. The fine, however, was later suspended and Perko was placed on probation, being permitted to resume payment of dues.
7
According to the evidence introduced by Perko, the iron workers informed the company, after settlement of the jurisdictional dispute with the boilermakers, that they would no longer take orders from Perko because he had been 'educating the boilermakers in their particular work.' Some weeks after completion of the project, the company laid him off 'due to his dispute with the union,' and Perko did not thereafter obtain employment with Pollock, or with any other company either as a superintendent or as a foreman.
8
The jury brought in a verdict of $25,000 for Perko, and the judgment was affirmed by the Court of Appeals. Ohio App., 187 N.E.2d 407. That court rejected again the contention that the State was without jurisdiction, and held on the merits that although 'there is very little that supports the cause sued on here,' the evidence was sufficient to sustain the verdict. The Supreme Court of Ohio dismissed an appeal 'for the reason that no debatable constitutional question is involved.' 173 Ohio St. 576, 184 N.E.2d 100. We granted certiorari, 371 U.S. 939, 83 S.Ct. 318, 9 L.Ed.2d 274, to consider the petitioner's claim that the State lacked jurisdiction over this dispute by virtue of the National Labor Relations Act, 49 Stat. 449, as amended, 29 U.S.C. §§ 151—168.
9
At the outset we note that for the reasons set forth in Borden, 373 U.S. 690, 83 S.Ct. 1423, the rationale of the Gonzales case does not support state jurisdiction here, and we need not now consider the present vitality of that rationale in the light of more recent decisions. As in Borden, the crux of the action here concerned alleged interference with the plaintiff's existing or prospective employment relations and was not directed to internal union matters. Indeed the state court itself observed that 'Plaintiff is not attempting to secure any redress for loss of rights as a member of the union.' Supra, p. 703. Thus there was no permissible state remedy to which the award of consequential damages for loss of earnings might be subordinated.
10
Respondent contends, however, that in any event the exercise of state jurisdiction is not precluded because the matter is clearly not subject to the Labor Board's cognizance.3 The basis of this contention is respondent's claim that he was a job superintendent, and thus a 'supervisor' within the meaning of the Act,4 at the time of the alleged tort and that he was thus excluded from the scope, operation, and protection of federal law. There are, we believe, two independent and conclusive answers to this argument, both of which establish that this matter falls squarely within the preemption principles declared in San Diego Building Trades Council v. Garmon, 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775.
11
First, even if it is conceded that a job superintendent is a supervisor, it is at least reasonably arguable that a foreman, as that term has been used in this case, is an 'employee' within the meaning of the Act, since his function is apparently to transmit instructions, not to originate them. See, e.g., New York Shipping Assn., 116 N.L.R.B. 1183. Perko in his complaint alleged that he had worked for many years 'as a foreman,' that the actions of the defendant were designed to cause his discharge 'as superintendent and foreman,' and that he was subsequently prevented from obtaining employment 'as a foreman.' The evidence indicated that Perko sometimes worked for Pollock as a regular iron worker in a gang, sometimes as a foreman, and sometimes as a superintendent.
12
It is evident that this case presents difficult problems of definition of status, problems which we have held are precisely 'of a kind most wisely entrusted initially to the agency charged with the day-to-day administration of the Act as a whole.' Marine Engineers Beneficial Assn. v. Interlake Steamship Co., 370 U.S. 173, 180, 82 S.Ct. 1237, 1241, 8 L.Ed.2d 418. It is entirely possible that the Board might conclude that a foreman under the facts of this case is an employee and that a man whose status fluctuates, as Perko's seemingly did, is entitled to claim the protection afforded employees under the Act. Given such a conclusion, Perko's complaint—that the petitioners caused his discharge and prevented his subsequent employment as a foreman as well as a superintendent—falls within the ambit of the unfair labor practices prohibited by §§ 8(b)(1)(A) and 8(b)(2) of the Act.5 And since petitioners' actions apparently resulted from Perko's violation of a union rule, there is a reasonable likelihood that on these premises the Board would have found such unfair labor practices to have been committed. See the discussion in the Borden case, 373 U.S., pp. 694—695, 83 S.Ct., pp. 1425 1426.
13
Second, even if it be assumed that Perko was not an employee but was solely a supervisor, there is a sufficient probability that the matter would still have been cognizable by the Board so as to compel the relinquishment of state jurisdiction. It has been held that discharge of a supervisor for failure effectively to cierce employees into renouncing their union affiliation constitutes a violation of § 8(a)(1) because such a discharge would reasonably cause nonsupervisory employees to fear that they might meet the same fate if they adhered to the union; and in such instances the Board has been sustained in ordering reinstatement of the supervisor with back pay. National Labor Relations Board v. Talladega Cotton Factory, Inc., 5 Cir., 213 F.2d 209, 40 A.L.R.2d 404; cf. National Labor Relations Board v. Better Monkey Grip Co., 5 Cir., 243 F.2d 836. So here, it may well be that a union's insistence on discharge of a supervisor for failure to comply with union rules would violate § 8(b)(1)(A) because it would inevitably tend to coerce nonsupervisory employees into observing those rules. If so, it would surely be within the Board's power under § 10(c) to order the union to reimburse the supervisor for lost wages.
14
Moreover, if a union forces an employer to discharge a supervisor, such conduct may well violate § 8(b)(1)(B) because it coerces the 'employer in the selection of his representatives for the purposes of collective bargaining or the adjustment of grievances.' Cf. International Typographical Union v. National Labor Relations Board, 1 Cir., 278 F.2d 6, aff'd in part by an equally divided Court, 365 U.S. 705, 81 S.Ct. 855, 6 L.Ed.2d 36; National Labor Relations Board v. Local 294, International Brotherhood of Teamsters, etc., 2 Cir., 284 F.2d 893. Whether a 'job superintendent' like Perko has sufficient responsibilities with regard to grievances to bring this section into play cannot be ascertained on this record, and in any event would be a question for initial determination by the Board. But the probability that such a violation of § 8(b)(1)(B) might have occurred, especially in view of Perko's role in the interunion dispute that gave rise to the present controversy, is certainly not insignificant.
15
We do not of course intimate any view on the merits of any of the underlying substantive questions, that is, whether the union was guilty of a violation of the Act. It is enough to hold, as we do, that it is plain on a number of scores that the subject matter of this lawsuit 'arguably' comes within the Board's jurisdiction to deal with unfair labor practices. We therefore conclude that the State must yield jurisdiction and the judgment below must be reversed.
16
Reversed.
17
Mr. Justice DOUGLAS and Mr. Justice CLARK dissent for the reasons stated in their dissent in No. 541, Local 100, United Assn. of Journeymen v. Borden, 373 U.S. 698, 83 S.Ct. 1423.
18
Mr. Justice GOLDBERG took no part in the consideration or decision of this case.
1
The record indicates that as used in this case a 'superintendent' is the supervisor of an entire construction project, who has working under him grojps of employees of various crafts. One member of each such craft group is designated as its 'foreman' and has the responsibility of receiving orders from the superintendent and transmitting them to his particular crew.
2
The rule provided that 'any member that leaves the iron workers to go in as a boilermaker or assist them in any way will be fined $500.' (Emphasis added.)
3
Respondent does not challenge the existence of the requisite effect on commerce to bring the matter within the scope of the Board's jurisdiction.
4
Section 2(3) of the Act defines 'employee' as not including 'any individual employed as a supervisor.' Section 2(11) defines 'supervisor' as meaning 'any individual having authority, in the interest of the employer, to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or responsibly to direct them, or to adjust their grievances, or effectively to recommend such action, if in connection with the foregoing the exercise of such authority is not of a merely routine or clerical nature, but requires the use of independent judgment.'
5
Section 8(b) of the Act provides that it shall be an unfair labor practice for a labor organizatiion or its agents '(1) to restrain or coerce (A) employees in the exercise of the rights guaranteed in section 7 * * *,' or '(2) to cause or attempt to cause an employer to discriminate against an employee in violation of subsection (a)(3) * * *.' Section 8(a) provides that it shall be an unfair labor practice for an employer '(3) by discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization. * * *'
| 910
|
373 U.S. 668
83 S.Ct. 1433
10 L.Ed.2d 622
Louis McNEESE, Jr., a Minor, by Mabel McNeese, His Mother and Next Friend, et al., Petitioners,v.BOARD OF EDUCATION FOR COMMUNITY UNIT SCHOOL DISTRICT 187, CAHOKIA, ILLINOIS, et al.
No. 480.
Argued April 23, 1963.
Decided June 3, 1963.
Raymond E. Harth, Chicago, Ill., for petitioners.
Howard Boman, East St. Louis, Ill., and Robert H. Reiter, Washington, D.C., for respondents.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
This suit, which invokes the jurisdiction of the District Court under the Civil Rights Act, is brought to vindicate the rights of plaintiffs who are Negro students in the Illinois public school system. The complaint alleges that Chenot School, St. Clair County, was built and its attendance area boundaries drawn in 1957 so as to make it exclusively a Negro school. It alleges that due to overcrowded conditions in an adjacent school, Centreville, which is in the same school district, all fifth and sixth grade classes in that school (containing 97% white students) were transferred to Chenot and kept segregated there. It alleges that enrollment at Chenot consists of 251 Negroes and 254 whites, all of the whites being in the group transferred from Centreville. It alleges that Negro students, with the exception of the eight transferred from Centreville, attend classes in one part of the school, separate and apart from the whites, and are compelled to use entrances and exits separate from the whites'. It alleges that Chenot school is a segregated school in conflict with the Constitution of the United States; and it prays for equitable relief, including registration of plaintiffs in racially integrated schools pursuant to a plan approved by the District Court.
2
Respondents moved to dismiss the complaint on the ground, inter alia, that the plaintiffs had not exhausted the administrative remedies provided by Illinois law. The District Court granted the motion. D.C., 199 F.Supp. 403. The Court of Appeals affirmed. 7 Cir., 305 F.2d 783. The case is here on a petition for a writ of certiorari which we granted. 371 U.S. 933, 83 S.Ct. 307, 9 L.Ed.2d 269.
3
The administrative remedy, which the lower courts held plaintiffs must first exhaust, is contained in the Illinois School Code. IllRev.Stat.1961, c. 122, § 22—19. By that Code, 50 residents of a school district or 10%, whichever is lesser, can file a complaint with the Superintendent of Public Instruction alleging that a pupil has been segregated in a school on account of race. The Superintendent, on notice to the school board, puts the complaint down for hearing within a prescribed time. After hearing, the Superintendent notifies the parties of his decision and, if he decides that the allegations in the complaint are 'substantially correct,' requests the Attorney General to bring suit to rectify the practice. Any final decision of the Superintendent may be reviewed by the courts. Moreover, under the School Code a school district may not file a claim for state aid unless it files with the Superintendent a sworn statement that the school district has complied with the constitutional and statutory provisions outlawing segregation in the public schools. See Ill.Const., Art. VIII, § 1; School Code §§ 10—22:5, 22—11, 22—12.
4
Respondents, while saying that Illinois law does not require the Superintendent to refuse to certify claims for state aid if he finds the particular school board practices segregation, contends that the Superintendent would have the power to withhold his certificate and as a practical matter would do so.
5
We have previously indicated that relief under the Civil Rights Act may not be defeated because relief was not first sought under state law which provided a remedy. We stated in Monroe v. Pape, 365 U.S. 167, 183, 81 S.Ct. 473, 482, 5 L.Ed.2d 492: SU 'It is no answer that the State has a law which if enforced would give relief. The federal remedy is supplementary to the state remedy, and the latter need not be first sought and refused before the federal one is invoked.'
6
The cause of action alleged here1 is pleaded in terms of R.S. § 1979, 42 U.S.C. § 1983, which reads:
7
'Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.'
8
That is the statute that was involved in Monroe v. Pape, supra; and we reviewed its history at length in that case. 365 U.S., at 171 et seq., 81 S.Ct., at 475 et seq. The purposes were severalfold—to override certain kinds of state laws, to provide a remedy where state law was inadequate, 'to provide a federal remedy where the state remedy, though adequate in theory, was not available in practice' (id., 174, 81 S.Ct. 477), and to provide a remedy in the federal courts supplementary to any remedy any State might have. Id., 180—183, 81 S.Ct. 480—482.
9
We would defeat those purposes if we held that assertion of a federal claim in a federal court must await an attempt to vindicate the same claim in a state court. The First Congress created federal courts as the chief—though not always the exclusive—tribunals for enforcement of federal rights. The heads of jurisdiction of the District Court, at the start limited,2 are now numerous. In the beginning the main concern was the security of commercial intercourse, which 'parochial prejudice' might endanger.3
10
'Maritime commerce was then the jugular vein of the Thirteen States. The need for a body of law applicable throughout the nation was recognized by every shade of opinion in the Constitutional Convention. From this recognition it was an easy step to entrust the development of such law to a distinctive system of courts, administering the same doctrines, following the same procedure, and subject to the same nationalist influences.'4
11
As the beneficiaries of the Fourteenth and Fifteenth Amendments became articulate and the nationalist needs multiplied, the heads of jurisdiction of the District Courts increased, and that increase was a measure of the broadening federal domain in the area of individual rights.
12
Where strands of local law are woven into the case that is before the federal court, we have directed a District Court to refrain temporarily from exercising its jurisdiction until a suit could be brought in the state court. See Railroad Comm'n of Texas v. Pullman Co., 312 U.S. 496, 61 S.Ct. 643, 85 L.Ed. 971; Thompson v. Magnolia Petroleum Co., 309 U.S. 478, 60 S.Ct. 628, 84 L.Ed. 876; Harrison v. N.A.A.C.P., 360 U.S. 167, 79 S.Ct. 1025, 3 L.Ed.2d 1152. Thus we have stayed the hands of a Federal District Court when it sought to enjoin enforcement of a state administrative order enforcing state law, since any federal question could be reviewed when the cases came here through the hierarchy of state courts. Burford v. Sun Oil Co., 319 U.S. 315, 63 S.Ct. 1098, 87 L.Ed. 1424. The variations on the theme have been numerous.5
13
We have, however, in the present case no underlying issue of state law controlling this litigation. The right alleged is as plainly federal in origin and nature as those vindicated in Brown v. Board of Education, 347 U.S. 483, 74 S.Ct. 686, 98 L.Ed. 873. Nor is the federal right in any way entangled in a skein of state law that must be untangled before the federal case can proceed. For petitioners assert that respondents have been and are depriving them of rights protected by the Fourteenth Amendment. It is immaterial whether respondents' conduct is legal or illegal as a matter of state law. Monroe v. Pape, supra, 365 U.S., at 171 187, 81 S.Ct., at 475—484. Such claims are entitled to be adjudicated in the federal courts.6 Monroe v. Pape, supra, 365 U.S. at 183, 81 S.Ct. at 481; Gayle v. Browder, 352 U.S. 903, 77 S.Ct. 145, 1 L.Ed.2d 114, affirming 142 F.Supp. 707; Borders v. Rippy, 5 Cir., 247 F.2d 268, 271. Cf., e.g., Lane v. Wilson, 307 U.S. 268, 59 S.Ct. 872, 83 L.Ed. 1281; Smith v. Allwright, 321 U.S. 649, 64 S.Ct. 757, 88 L.Ed. 987; Schnell v. Davis, 336 U.S. 933, 69 S.Ct. 749, 93 L.Ed. 1093, affirming 81 F.Supp. 872; Turner v. Memphis, 369 U.S. 350, 82 S.Ct. 805, 7 L.Ed.2d 762.
14
Moreover, it is by no means clear that Illinois law provides petitioners with an administrative remedy sufficiently adequate to preclude prior resort to a federal court for protection of their federal rights. Under § 22—19 of the Illinois School Code petitioners could file a complaint alleging discrimination if they could obtain the subscription of the lesser of 50 residents or 10% of the school district. The Superintendent would then be required to hold a hearing on the matter. And,
15
'If he so determines (that the allegations of the complaint are substantially correct), he shall request the Attorney General to apply to the appropriate circuit court for such injunctive or other relief as may be necessary to rectify the practice complained of.' (Emphasis added.)
16
The Superintendent himself apparently has no power to order corrective action. In other words, his 'only function * * * is to investigate, recommend and report. (He) can give no remedy. (He) can made no controlling finding of law or fact. (His) recommendation need not be followed by any court * * * or executive officer.' United States Alkali Export Ass'n v. United States, 325 U.S. 196, 210, 65 S.Ct. 1120, 1128, 89 L.Ed. 1554. It would be anomalous to conclude that such a remedy forecloses suit in the federal courts when the most it could produce is a state court action that would have no such effect. See Lane v. Wilson, supra, at 274—275, 59 S.Ct. at 875—876; Monroe v. Pape, supra.
17
Respondents urge, however, that prior resort to the Superintendent is necessary because by § 2—3.25 he can revoke recognition of a school district guilty of violating pupils' Fourteenth Amendment rights, and recognition is a necessary condition to state financial aid. Furthermore, state aid cannot be received by a district unless it submits a sworn statement that it does not discriminate between students 'on account of color, creed, race or nationality.' §§ 10—22.5, 18—12. Respondents say that the Superintendent would not certify a district for state aid if he determined that its sworn statement was false Apparently no Illinois cases have held that the Superintendent has authority to withhold funds once he has received an affidavit from the district, even if he determines that the affidavit is false. In any event, the withholding of state aid is at best only an indirect sanction of Fourteenth Amendment rights. When federal rights are subject to such tenuous protection, prior resort to a state proceeding is not necessary. See Hillsborough v. Cromwell, 326 U.S. 620, 625—626, 66 S.Ct. 445, 90 L.Ed. 358.
18
Reversed.
19
Mr. Justice HARLAN, dissenting.
20
In Burford v. Sun Oil Co., 319 U.S. 315, 317—318, 63 S.Ct. 1098, 1099, this Court said:
21
'Although a federal equity court does have jurisdiction of a particular proceeding, it may, in its sound discretion, whether its jurisdiction is invoked on the ground of diversity of citizenship or otherwise, 'refuse to enforce or protect legal rights, the exercise of which may be prejudicial to the public interest'; (citing United States v. Dern, 289 U.S. 352, 360, 53 S.Ct. 614, 617, 77 L.Ed. 1250) for it 'is in the public interest that federal courts of equity should exercise their discretionary power with proper regard for the rightful independence of state governments in carrying out their domestic policy.' * * * (Citing Pennsylvania v. Williams, 294 U.S. 176, 185, 55 S.Ct. 380, 79 L.Ed. 841.) Assuming that the federal district court had jurisdiction, should it, as a matter of sound equitable discretion, have declined to exercise that jurisdiction here?'
22
This wise approach has been followed by the lower federal courts in 'school segregation' cases (see, e.g., Carson v. Board of Education of McDowell County, 4 Cir., 227 F.2d 789; Carson v. Warlick, 4 Cir., 238 F.2d 724; Covington v. Edwards, 4 Cir., 264 F.2d 780; Holt v. Raleigh City Board of Education, 4 Cir., 265 F.2d 95; Parham v. Dove, 8 Cir., 271 F.2d 132; Shepard v. Board of Education of the City of Englewood, D.C., 207 F.Supp. 341), and more than once this Court has refused to interfere (see Carson v. Warlick, supra, cert. denied, 353 U.S. 910, 77 S.Ct. 665, 1 L.Ed.2d 664; Holt v. Raleigh City Board of Education, supra, cert. denied, 361 U.S. 818, 80 S.Ct. 59, 4 L.Ed.2d 63).1 For several reasons I think the present case is peculiarly one where, as was said in Burford (at p. 334, 63 S.Ct. at p. 1107), 'a sound respect for the independence of state action requires the federal equity court to stay its hand.'
23
1. It is apparent on the face of the complaint that this case is quite atypical of others that have come before this Court, in that the Chenot School's student body includes both white and Negro students—in almost equal numbers—and in that none of the petitioners (or others whom they purport to represent) has been refused enrollment in the school. The alleged discriminatory practices relate, rather, to the manner in which this particular school district was formed and to the way in which the internal affairs of the school are administered. These are matters in which the federal courts should not initially become embroiled. Their exploration and correction, if need be, are much better left to local authority in the first instance.
24
2. There is nothing that leaves room for serious doubt as to the efficacy of the administrative remedy which Illinois has provided. (The text of the statute is set forth in the Appendix to this opinion.) The fact that the Superintendent of Public Instruction himself possesses no corrective power and that he can only 'request' the Attorney General to enforce his findings by appropriate court proceedings does not, in my opinion, leave the administrative proceeding sanctionless (compare United States Alkali Export Assn. v. United States, 325 U.S. 196, 65 S.Ct. 1120, 89 L.Ed. 1554), or, as in Lane v. Wilson, 307 U.S. 268, 59 S.Ct. 872, 83 L.Ed. 1281, serve to remove this case from the 'exhaustion' requirements of Burford. If the Superintendent refuses to activate the Attorney General, his decision (as with a contrary one) is subject to judicial review. It is not suggested that the Attorney General could not also be compelled to act if he improperly refused to do so. And it must of course be assumed that these two responsible public officials will fully perform their sworn duty. Moreover, the terms of the statute itself which, among other things, provides for the use of compulsory process, strongly attest to the fact that the administrative remedy was intended as serious business and not as an exercise that might abort before fulfillment.
25
Nor can this administrative remedy otherwise be regarded as deficient. The fact that it takes a minimal number of school district residents to initiate a complaint before the Superintendent can hardly be deemed an untoward or unduly burdensome requirement. And the proceeding surely finds a strong practical even though 'indirect sanction' (ante, p. 676) in the power of the Superintendent at least to make it more difficult for a school, guilty of racial discrimination, to obtain state financial aid—either by revoking 'recognition' of the school district (ante, p. 675) or, as suggested to us by respondents' attorneys, by refusing to certify such a school for state aid.2
26
3. Finally, we should be slow to hold unavailing an administrative remedy afforded by a State which long before Brown v. Board of Education, 347 U.S. 483, 74 S.Ct. 686, 98 L.Ed. 873, had outlawed both by its constitution and statutes racial discrimination in its public schools,3 and which since Brown has passed the further implementing legislation drawn in question in this litigation (Appendix). For myself I am unwilling to assume that these solemn constitutional and legislative pronouncements of Illinois mean anything less than what they say or that the rights assured by them and by the Fourteenth Amendment will not be fully and promptly vindicated by the State if petitioners can make good their grievances.
27
I would affirm.
28
APPENDIX TO OPINION OF MR. JUSTICE HARLAN.
29
Section 22—19 of the School Code of Illinois provides:
30
'Upon the filing of a complaint with the Superintendent of Public Instruction, executed in duplicate and subscribed with the names and addresses of at least 50 residents of a school district or 10%, whichever is lesser, alleging that any pupil has been excluded from or segregated in any school on account of his color, race, nationality, religion or religious affiliation, or that any employee of or applicant for employment or assignment with any such school district has been questioned concerning his color, race, nationality, religion or religious affiliation or subjected to discrimination by reason thereof, by or on behalf of the school board of such district, the Superintendent of Public Instruction shall promptly mail a copy of such complaint to the secretary or clerk of such school board.
31
'The Superintendent of Public Instruction shall fix a date, not less than 20 nor more than 30 days from the date of the filing of such complaint, for a hearing upon the allegations therein. He may also fix a date for a hearing whenever he has reason to believe that such discrimination may exist in any school district. Reasonable notice of the time and place of such hearing shall be mailed to the secretary or clerk of the school board and to the first subscriber to such complaint.
32
'The Superintendent of Public Instruction may designate an assistant to conduct such hearing and receive testimony concerning the situation complained of. The complainants may be represented at such hearing by one of their number or by counsel. Each party shall have the privilege of cross examining witnesses. The Superintendent of Public Instruction or the hearing officer appointed by him shall have the power to subpoena witnesses, compel their attendance, and require the production of evidence relating to any relevant matter under this Act. Any Circuit or Superior Court of this State, or any judge thereof, either in term time or vacation, upon the application of the Superintendent of Public Instruction or the hearing officer appointed by him, may, in its or his discretion, compel the attendance of witnesses, the production of books, papers, records or memoranda and the giving of testimony befor the Superintendent of Public Instruction or the hearing officer appointed by him conducting an investigation or holding a hearing authorized by this Act, by an attachment for contempt, or otherwise, in the same manner as production of evidence may be compelled before said court. The Superintendent of Public Instruction or the hearing officer appointed by him may cause the depositions of witnesses within the State to be taken in the manner prescribed by law for like depositions in civil actions in courts of this State, and to that end compel the attendance of witnesses and the production of books, papers, records or memoranda. All testimony shall be taken under oath administered by the hearing officer, but the formal rules pertaining to evidence in judicial proceedings shall not apply. The Superintendent of Public Instruction shall provide a competent reporter to take notes of all testimony. Either party desiring a transcript of the hearing shall pay for the cost of such transcript. The hearing officer shall report a summary of the testimony to the Superintendent of Public Instruction who shall determine whether the allegations of the complaint are substantially correct. The Superintendent of Public Instruction shall notify both parties of his decision. If he so determines, he shall request the Attorney General to apply to the appropriate circuit court for such injunctive or other relief as may be necessary to rectify the practice complained of.
33
'The provisions of the 'Administrative Review Act', approved May 8, 1945, and all amendments and modifications thereof and the rules adopted pursuant thereto shall apply to and govern all proceedings for the judicial review of any final decision rendered by the Superintendent of Public Instruction pursuant to this Section.'
1
Federal jurisdiction is asserted under 28 U.S.C. § 1343, which in material part reads as follows:
'The district courts shall have original jurisdiction of any civil action authorized by law to be commenced by any person:
'(3) To redress the deprivation, under color of any State law, statute, ordinance, regulation, custom or usage, of any right, privilege or immunity secured by the Constitution of the United States or by any Act of Congress providing for equal rights of citizens or of all persons within the jurisdiction of the United States.'
2
General 'arising under' jurisdiction was not conferred on federal courts of first instance until passage of the Judiciary Act of 1875, 18 Stat. 470. See Hart and Wechsler, The Federal Courts and the Federal System, 727—733.
3
Frankfurter and Landis, The Business of the Supreme Court (1928), pp. 8—9.
4
Id., p. 7.
5
See Note, 59 Col.L.Rev. 749. Yet where Congress creates a head of federal jurisdiction which entails a responsibility to adjudicate the claim on the basis of state law, viz., diversity of citizenship, as was true in Meredith v. Winter Haven, 320 U.S. 228, 64 S.Ct. 7, 88 L.Ed. 9, we hold that difficulties and perplexities of state law are no reason for referral of the problem to the state court:
'We are pointed to no public policy or interest which would be served by withholding from petitioners the benefit of the jurisdiction which Congress has created with the purpose that it should be availed of and exercised subject only to such limitations as traditionally justify courts in declining to exercise the jurisdiction which they possess. To remit the parties to the state courts is to delay further the disposition of the litigation which has been pending for more than two years and which is now ready for decision. It is to penalize petitioners for resorting to a jurisdiction which they were entitled to invoke, in the absence of any special circumstances which would warrant a refusal to exercise it.' Id., p. 237, 64 S.Ct. p. 12.
And we held in Kline v. Burke Construction Co., 260 U.S. 226, 43 S.Ct. 79, 67 L.Ed. 226, that, apart from contests over a res (Pennsylvania v. Williams, 294 U.S. 176, 55 S.Ct. 380, 79 L.Ed. 841), a suit in personam based on diversity of citizenship could continue in the federal court even though a suit on the same cause of action had been started in the state court:
'Each court is free to proceed in its own way and in its own time, without reference to the proceedings in the other court. Whenever a judgment is rendered in one of the courts and pleaded in the other, the effect of that judgment is to be determined by the application of the principles of res adjudicata by the court in which the action is still pending in the orderly exercise of its jurisdiction, as it would determine any other question of fact or law arising in the progress of the case. The rule, therefore, has become generally established that where the action first brought is in personam and seeks only a personal judgment, another action for the same cause in another jurisdiction is not precluded.' 260 U.S., p. 230, 43 S.Ct. p. 81.
6
As well stated by Judge Murrah in Stapleton v. Mitchell, 60 F.Supp. 51, 55, appeal dismissed pursuant to stipulation, 326 U.S. 690, 66 S.Ct. 172, 90 L.Ed. 406: 'We yet like to believe that wherever the Federal courts sit, human rights under the Federal Constitution are always a proper subject for adjudication, and that we have not the right to decline the exercise of that jurisdiction simply because the rights asserted may be adjudicated in some other forum.'
1
Cases such as Mannings v. Board of Public Instruction of Hillsborough County, 5 Cir., 277 F.2d 370, and Borders v. Rippy, 5 Cir., 247 F.2d 268 (where the school boards had taken no affirmative steps whatever to desegregate the schools), and Orleans Parish School Board v. Bush, 5 Cir., 242 F.2d 156, and Gibson v. Board of Public Instrucdtion of Dade County, 5 Cir., 246 F.2d 913 (arising in States having school segregation statutes on their books), are wide of the mark in the circumstances of this case.
2
Section 18—12 of the School Code of Illinois provides in part:
'No State aid claim may be filed for any district unless the clerk or secretary of the school board executes and files with the Superintendent of Public Instruction, on forms prescribed by him, a sworn statement that the district has complied with the requirements of Section 10—22.5 in regard to the non-segregation of pupils on account of color, creed, race or nationality.'
3
As early as 1901 the Supreme Court of Illinois in People ex rel. Bibb v. Mayor etc., of City of Alton, 193 Ill. 309, 312, 61 N.E. 1077, 1078, 56 L.R.A. 95, construing Art. VIII, § 1, of the Illinois Constitution, held:
'The complaint of the relator is that his children have been excluded, on account of their color, from the public school of said city located near his residence, and been required to attend a school located a mile and a half distant from his residence, established exclusively for colored children. Such complaint is not met by showing that the schools established for colored children in said city equal or surpass in educational facilities the schools established in said city for white children. Under the law the common council of said city had no right to establish different schools for the white children and colored children of said city, and to exclude the colored children from the schools established for white children, even though the schools established for colored children furnished educational facilities equal or superior to those of the schools established for white children.'
Section 10—22.5 of the School Code of Illinois has provided since 1945 that:
'* * * no pupil shall be excluded from or segregated in any such school on account of his color, race or nationality.'
Sections 22—11 and 22—12 of the School Code, enacted in 1909, provide:
'Any school officer or other person who excludes or aids in excluding from the public schools, on account of color, any child who is entitled to the benefits of such school shall be fined not less than $5 nor more than $100.'
'Whoever by threat, menace or intimidation prevents any colored child entitled to attend a public school in this State from attending such school shall be fined not exceeding $25.'
| 12
|
373 U.S. 690
83 S.Ct. 1423
10 L.Ed.2d 638
LOCAL 100 OF the UNITED ASSOCIATION OF JOURNEYMEN AND APPRENTICES, Petitioner,v.H. N. BORDEN.
No. 541.
Argued April 24, 1963.
Decided June 3, 1963.
L. N. D. Wells, Jr., Dallas, Tex., for petitioner.
Robert Weldon Smith, Dallas, Tex., for respondent.
Mr. Justice HARLAN delivered the opinion of the Court.
1
This case presents one facet of the recurrent problem of defining the permissible scope of state jurisdiction in the field of labor relations. The particular question before us involves consideration and application, in this suit by a union member against a local union, of the principles declared in International Assn. of Machinists v. Gonzales, 356 U.S. 617, 78 S.Ct. 923, 2 L.Ed.2d 1018, and San Diego Building Trades Council v. Garmon, 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775.
I.
2
The respondent, H. N. Borden, who was then a member of the Shreveport, Louisiana, local of the plumbers union, arrived in Dallas, Texas, in September 1953, looking for a job with the Farwell Construction Company on a particular bank construction project. Farwell's hiring on this project was done through union referral, although there was no written agreement to this effect. Borden was unable to obtain such a referral from the business agent of the Dallas local of the plumbers union, even after the agent had accepted Borden's clearance card from the Shreveport local and after the Farwell foreman on the construction project had called the business agent and asked to have Borden sent over. According to Borden's testimony, the business agent told him:
3
'You are not going to work down there on the bank job or for Farwell, you have come in here wrong, you have come in here with a job in your pocket.'
4
And according to the Farwell foreman, the business agent answered his request by saying:
5
'I am not about to send that old _ _ down there, he shoved his card down our throat and I am not about to send him to the bank.' Borden never did get the job with Farwell, although he was referred to and accepted several other jobs during the period before the bank construction project was completed.
6
Subsequently, he brought the present suit against the Dallas local, petitioner here, and the parent International,1 seeking damages under state law for the refusal to refer him to Farwell. He alleged that the actions of the defendants constituted a willful, malicious, and discriminatory interference with his right to contract and to pursue a lawful occupation; that the defendants had breached a promise, implicit in the membership arrangement, not to discriminate unfairly or to deny any member the right to work; and that the defendants had violated certain state statutory provisions.2
7
Petitioner challenged the state court's jurisdiction, asserting that the subject matter of the suit was within the exclusive jurisdiction of the National Labor Relations Board. The trial court upheld the challenge and dismissed the suit, but on appeal the Texas Court of Civil Appeals, relying on this Court's decision in International Assn. of Machinists v. Gonzales, supra, reversed and remanded for trial. 316 S.W.2d 458. The Texas Supreme Court granted a writ of error on another point in the case and affirmed the remand. 160 Tex. 203, 328 S.W.2d 739.
8
At trial, the case was submitted to the jury on special issues and the jury's answers included findings that Borden had been promised a job by a Farwell representative; that the Farwell foreman asked the union business agent to refer Borden; that the business agent 'wilfully' refused to let Borden work on the bank project, knowing that Borden was entitled to work on that project under union rules; and that the conduct of the business agent was approved by the officers and members of petitioner. Actual loss of earnings resulting from the refusal to refer Borden to the Farwell job was found to be $1,916; compensation for mental suffering, $1,500; and punitive damages, $5,000. The trial court disallowed recovery for mental anguish and ordered a remittitur of the punitive damages in excess of the amount of actual damages, thus awarding total damages of $3,832. The Court of Civil Appeals affirmed, 355 S.W.2d 729, again rejecting petitioner's preemption argument. Following denial of a writ of error by the Supreme Court of Texas, we granted certiorari, 371 U.S. 939, 83 S.Ct. 319, 9 L.Ed.2d 274, to consider the question whether federal labor law precludes the exercise of state jurisdiction over this dispute.
II.
9
This Court held in San Diego Building Trades Council v. Garmon, 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775, that in the absence of an overriding state interest such as that involved in the maintenance of domestic peace, state courts must defer to the exclusive competence of the National Labor Relations Board in cases in which the activity that is the subject matter of the litigation is arguably subject to the protections of § 7 or the prohibitions of § 8 of the National Labor Relations Act.3 This relinquishment of state jurisdiction, the Court stated, is essential 'if the danger of state interference with national policy is to be averted,' 359 U.S., at 245, 79 S.Ct., at 780 and is as necessary in a suit for damages as in a suit seeking equitable relief. Thus the first inquiry, in any case in which a claim of federal preemption is raised, must be whether the conduct called into question may reasonably be asserted to be subject to Labor Board cognizance.
10
In the present case, respondent contends that no such assertion can be made, but we disagree.4 The facts as alleged in the complaint, and as found by the jury, are that the Dallas union business agent, with the ultimate approval of the local union itself, refused to refer the respondent to a particular job for which he had been sought, and that this refusal resulted in an inability to obtain the employment. Notwithstanding the state court's contrary view, if it is assumed that the refusal and the resulting inability to obtain employment were in some way based on respondent's actual or believed failure to comply with internal union rules, it is certainly 'arguable' that the union's conduct violated § 8(b)(1)(A), by restraining or coercing Borden in the exercise of his protected right to refrain from observing those rules, and § 8(b)(2), by causing an employer to discriminate against Borden in violation of § 8(a)(3).5 See, e.g., Radio Officers' Union, etc. v. National Labor Relations Board, 347 U.S. 17, 74 S.Ct. 323, 98 L.Ed. 455; Local 568, Hotel Employees, 141 N.L.R.B. No. 29; International Union of Operating Engineers, Local 524 A—B, 141 N.L.R.B. No. 57. As established in the Radio Officers case, the 'membership' referred to in § 8(a)(3) and thus incorporated in § 8(b)(2) is broad enough to embrace participation in union activities and maintenance of good standing as well as mere adhesion to a labor organization. 347 U.S., at 39—42, 74 S.Ct., at 335—336. And there is a substantial possibility in this case that Borden's failure to live up to the internal rule prohibiting the solicitation of work from any contractor6 was precisely the reason why clearance was denied. Indeed this may well have been the meaning of the business agent's remark, testified to by Borden himself, that 'you have come in here wrong, you have come in here with a job in your pocket.'
11
It may also be reasonably contended that after inquiry into the facts, the Board might have found that the union conduct in question was not an unfair labor practice but rather was protected concerted activity within the meaning of § 7. This Court has held that hiring-hall practices do not necessarily violate the provisions of federal law, Local 357, International Brotherhood of Teamsters etc. v. National Labor Relations Board, 365 U.S. 667, 81 S.Ct. 835, 6 L.Ed.2d 11, and the Board's appraisal of the conflicting testimony might have led it to conclude that the refusal to refer was due only to the respondent's efforts to circumvent a lawful hiring-hall arrangement rather than to his engaging in protected activities. The problems inherent in the operation of union hiring halls are difficult and complex, see Rothman, The Development and Current Status of the Law Pertaining to Hiring Hall Arrangements, 48 Va.L.Rev. 871, and point up the importance of limiting initial competence to adjudicate such matters to a single expert federal agency.
12
We need not and should not now consider whether the petitioner's activity in this case was federally protected or prohibited, on any of the theories suggested above or on some different basis.7 It is sufficient for present purposes to find, as we do, that it is reasonably 'arguable' that the matter comes within the Board's jurisdiction.
III.
13
Respondent urges that even if the union's interference with his employment is a matter that the Board could have dealt with, the state courts are still not deprived of jurisdiction in this case under the principles declared in International Assn. of Machinists v. Gonzales, 356 U.S. 617, 78 S.Ct. 923, 2 L.Ed.2d 1018. Gonzales was a suit against a labor union by an individual who claimed that he had been expelled in violation of his contractual rights and who was seeking restoration of membership. He also sought consequential damages flowing from the expulsion, including loss of wages resulting from loss of employment and compensation for physical and mental suffering. It was recognized in that case that restoration of union membership was a remedy that the Board could not afford and indeed that the internal affairs of unions were not in themselves a matter wthin the Board's competence.8
14
The Court then went on to hold that, in the presence of admitted state jurisdiction to order restoration of membership, the State was not without power 'to fill out this remedy' by an award of consequential damages, even though these damages might be for conduct that constituted an unfair labor practice under federal law. The Taft-Hartley Act, the Court stated, did not require mutilation of 'the comprehensive relief of equity.' 356 U.S., at 621, 78 S.Ct. at 925.
15
The Gonzales decision, it is evident, turned on the Court's conclusion that the lawsuit was focused on purely internal union matters, i.e., on relations between the individual plaintiff and the union not having to do directly with matters of employment, and that the principal relief sought was restoration of union membership rights. In this posture, collateral relief in the form of consequential damages for loss of employment was not to be denied.
16
We need not now determine the extent to which the holding the Garmon, supra, qualified the principles declared in Gonzales with respect to jurisdiction to award consequential damages, for it is clear in any event that the present case does not come within th Gonzales rationale. The suit involved here was focused principally, if not entirely, on the union's actions with respect to Borden's efforts to obtain employment. No specific equitable relief was sought directed to Borden's status in the union, and thus there was no state remedy to 'fill out' by permitting the award of consequential damages. The 'crux' of the action (Gonzales, 356 U.S., at 618, 78 S.Ct., at 924) concerned Borden's employment relations and involved conduct arguably subject to the Board's jurisdiction.
17
Nor do we regard it as significant that Borden's complaint against the union sounded in contract as well as in tort. It is not the label affixed to the cause of action under state law that controls the determination of the relationship between state and federal jurisdiction. Rather, as stated in Garmon, supra, 359 U.S., at 246, 76 S.Ct. at 780,
18
'(o)ur concern is with delimiting areas of conduct which must be free from state regulation if national policy is to be left unhampered.' (Emphasis added.)
19
In the present case the conduct on which the suit is centered, whether described in terms of tort or contract, is conduct whose lawfulness could initially be judged only by the federal agency vested with exclusive primary jurisdiction to apply federal standards.
20
Accordingly, we conclude that the judgment of the court below must be reversed.
21
Reversed.
22
Mr Justice GOLDBERG took no part in the consideration or decision of this case.
23
Mr. Justice DOUGLAS, with whom Mr. Justice CLARK concurs, dissenting.
24
While I dissented in International Association v. Gonzales, 356 U.S. 617, 78 S.Ct. 923, 2 L.Ed.2d 1018, I fail to see how that case can fairly be distinguished from this one. Both Gonzales and San Diego Building Trades Council v. Garmon, 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775, were written by the same author, who had no difficulty in reconciling them. And they were decided before Congress reentered the labor relations field with the Landrum-Griffin Act of 1959. 73 Stat. 519. Yet, the Court points to no indication that Congress thought Gonzales had incorrectly interpreted the balance it had struck between state and federal jurisdiction over these matters.
25
The distinction the Court draws between this case and Gonzales—that in Gonzales the lawsuit focused on purely internal union matters—is not one that a court can intelligently apply in the myriad of cases in the field. This lawsuit started with a quarrel between respondent and his union, concerning the scope of membership rights in the union, as did Gonzales; and it is with those rights that this litigation is concerned, as was Gonzales. And, as here, it was conceded in Gonzales that the conduct complained of might well amount to an unfair labor practice within the Labor Board's jurisdiction. Because of these similarities, and because the Court is clearly right in saying '(i)t is not the label affixed to the cause of action under state law that controls the determination of the relationship between state and federal jurisdiction,' I am able to find no support for the Court's distinction of Gonzales in the fact that it was primarily an 'equitable' case where damages were allowed only to 'fill out' the union member's remedy. Cf. Federal Rules of Civil Procedure, Rules 1, 2, and 54(c).
26
San Diego Building Trades Council v. Garmon, supra, involved a controversy between union and employer in the classical case for National Labor Board jurisdiction. Suits for damages by individual employees against the union or the employer fall in the category of Moore v. Illinois Central R. Co., 312 U.S. 630, 61 S.Ct. 754, 85 L.Ed. 1089. As a matter of policy, there is much to be said for allowing the individual employee recourse to conventional litigation in his home-town tribunal for redress of grievances. Washington, D.C., and its administrative agencies—and even regional offices—are often distant and remote and expensive to reach. Under today's holding the member who has a real dispute with his union may go without a remedy.*
27
See, e.g., San Diego Building Trades Council v. Garmon, supra; Guss v. Utah Labor Board, 353 U.S. 1, 77 S.Ct. 598, 1 L.Ed.2d 601. When the basic dispute is between a union and an employer, any hiatus that might exist in the jurisdictional balance that has been struck can be filled by resort to economic power. But when the union member has a dispute with his union, he has no power on which to rely. If Gonzales—written in the spirit of Moore—is to survive, this judgment should be affirmed.
1
The trial court granted a directed verdict in favor of the parent International, and the parent organization is therefore no longer in the case.
2
Tex.Civ.Stat.Ann., 1962, Art. 5207a—'Right to bargain freely * * *'—was cited by Borden in his complaint. This statute, however, was not relied upon by the courts below as supporting recovery, and its effect need not be considered here.
3
49 Stat. 452, as amended, 29 U.S.C. §§ 157, 158. We do not deal here with suits brought in state courts under § 301 or § 303 of the Labor Management Relations Act, 61 Stat. 156, 158, 29 U.S.C. §§ 185, 187, which are governed by federal law and to which different principles are applicable. See, e.g., Smith v. Evening News Assn., 371 U.S. 195, 83 S.Ct. 267, 9 L.Ed.2d 246.
4
Respondent does not challenge the existence of the requisite effect on commerce to bring the matter within the scope of the Board's jurisdiction.
5
Section 8(a) of the Act provides that it shall be an unfair labor practice for an employer '(3) by discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization * * *.'
Section 8(b) of the Act provides that it shall be an unfair labor practice for a labor organization or its agents '(1) to restrain or coerce (A) employees in the exercise of the rights guaranteed in section 7 * * *:' or '(2) to cause or attempt to cause an employer to discriminate against an employee in violation of subsection (a)(3) * * *.'
6
Section 30 of Article I of the bylaws of petitioner provides in pertinent part that 'Members shall not solicit work from any contractor of their representative. All employment must be procured through Business Office of Local Union No. 100.'
7
As one possible additional basis on which the conduct in question might have been held to be prohibited, for example, petitioner refers us to the Board's recent decision in Miranda Fuel Co., 140 N.L.R.B. No. 7, in which the majority held that a statutory bargaining representative violates § 8(b)(2) 'when, for arbitrary or irrelevant reasons or upon the basis of an unfair clasification, the union attempts to cause or does cause an employer to derogate the employment status of an employee.' Again, we need not and do not pass upon the correctness of that decision or its applicability in the circumstances of this case.
8
Section 8(b)(1)(A), it should be noted, contains a proviso to the effect that 'this paragraph shall not impair the right of a labor organization to prescribe its own rules with respect to the acquisition or retention of membership therein.'
*
It is by no means clear that the General Counsel, who by § 3(d) has 'final authority' to investigate charges and to issue complaints, can be made to file a charge on behalf of this individual claimant. See Hourihan v. National Labor Relations Board, 91 U.S.App.D.C. 316, 201 F.2d 187; Dunn v. Retail Clerks, 6 Cir., 299 F.2d 873; 307 F.2d 285.
| 910
|
373 U.S. 746
83 S.Ct. 1461
10 L.Ed.2d 678
RETAIL CLERKS INTERNATIONAL ASSOCIATION, LOCAL 1625, AFL-CIO, et al., Petitioners,v.Alberta SCHERMERHORN et al.
No. 368.
Argued April 18, 1963.
Decided June 3, 1963.
[Syllabus from 746 intentionally omitted]
S. G. Lippman, Washington, D.C., for petitioners.
Bernard B. Weksler, Miami, Fla., for respondents.
Mr. Justice WHITE delivered the opinion of the Court.
1
Like National Labor Relations Board v. General Motors Corp., 373 U.S. 734, 83 S.Ct. 1453, decided today, this case involves the status of an 'agency shop' arrangement. We have concluded that the contract involved here is within the scope of § 14(b) of the National Labor Relations Act and therefore is congressionally made subject to prohibition by Florida law. We have not determined, however, whether the Florida courts, rather than solely the National Labor Relations Board, are tribunals with jurisdiction to enforce
[Amicus Curiae intentionally omitted] the State's prohibition against such arrangements. Accordingly, the case is retained on the calendar for reargument on the undecided issue.
2
Retail Clerks Local 1625 is the certified bargaining agent for the Food Fair Stores supermarket chain in five South Florida counties. In October 1960 the union and the employer negotiated a collective bargaining agreement effective until April 1963.1 The contract provided for various terms and conditions of employment, such as protection against discharge except for just cause, paid vacations and holidays, pregnancy leaves of absence, life and hospitalization insurance, paid time off to vote, to serve on juries, and to attend funerals, as well as for wage-and-hour terms; a grievance and arbitration clause was inserted for enforcement of these terms, under which the union and employer agree to divide between them the cost of the grievance-arbitration machinery. The contract also contained Article 19, which is the subject of the present lawsuit:
3
'Employees shall have the right to voluntarily join or refrain from joining the Union. Employees who choose not to join the Union, however, and who are covered by the terms of this contract, shall be required to pay as a condition of employment, an initial service fee and monthly service fees to the Union for the purpose of aiding the Union in defraying costs in connection with its legal obligations and responsibilities as the exclusive bargaining agent of the employees in the appropriate bargaining unit.
4
The aforesaid fees shall be payable on or before the first day of each month, and such sums shall in no case exceed the initiation fees and the membership dues paid by those who voluntarily choose to join the Union. Other than the payment of these service fees, those employees who do not choose to join the Union shall be under no further financial obligations or requirements of any kind to the Union. It shall also be a condition of employment that all employees covered by this Agreement shall on the 30th day following the beginning of such employment or the effective date of this agreement, whichever is later, pay established initial and monthly service fees as shown above.'
5
The union and the employer jointly posted a notice to employees, immediately after execution of the collective agreement, explaining the new contract with particular reference to the agency shop clause:
6
'The Agency Shop recognizes that union membership in the State of Florida is a voluntary act of the employee. On the other hand, under an Agency Shop Agreement, those Employees who do not become members of the Union nevertheless are required to pay the necessary service fees to the Local Union in order to aid the Union in meeting its authorized expenses as the exclusive bargaining agent.
7
'Therefore, the Company and the Union have agreed that even though you may not have joined the Union, you are obligated, under the provisions of the Agency Shop, to pay an initial service fee which is the equal of the initiation fee for Union members and a monthly service fee which is the equal of the monthly dues for those who voluntarily become Union members. Note: An Employee who pays the regular initial fee and regular monthly service fee but does not voluntarily join the Union, does not participate in the internal union affairs even though said Employee receives equal treatment under the contract.'
8
The present class action was then instituted by respondents, four nonunion employees of Food Fair, who sought a declaration that Article 19 was 'null and void and unenforceable,' a temporary and permanent injunction against petitioner and Food Fair to prevent them from requiring respondents or members of the class on behalf of which they sued (all Food Fair employees covered by the collective agreement) to contribute money to the union under Article 19, and an accounting. The trial court granted a motion to dismiss on the ground that Article 19 did not violate the Florida right-to-work law, Fla.Const. § 12, F.S.A.2 47 L.R.R.M. 2300. The Florida Supreme Court reversed, holding that state law forbade and that its courts could deal with the agency shop clause involved here, and remanded the case for further proceedings in the trial court. 141 So.2d 269, cert. granted, 371 U.S. 909, 83 S.Ct. 253, 9 L.Ed.2d 169.
I.
9
The case to a great extent turns upon the scope and effect of § 14(b) of the National Labor Relations Act, added to the Act in 1947, 29 U.S.C. § 164(b):
10
'Nothing in this Act shall be construed as authorizing the execution or application of agreements requiring membership in a labor organization as a condition of employment in any State or Territory in which such execution or application is prohibited by State or Territorial law.'
11
As is immediately apparent from its language, § 14(b) was designed to prevent other sections of the Act from completely extinguishing state power over certain union-security arrangements. And it was the proviso to § 8(a)(3),3 expressly permitting agreements conditioning employment upon membership in a labor union, which Congress feared might have this result. It was desired to 'make certain' that § 8(a)(3) could not 'be said to authorize arrangements of this sort in States where such arrangements were contrary to the State policy.' H.R.Conf.Rep.No.510, 80th Cong., 1st Sess. 60, 1 Leg.Hist.L.M.R.A. 564.
12
The connection between the § 8(a)(3) proviso and § 14(b) is clear. Whether they are perfectly coincident, we need not now decide, but unquestionably they overlap to some extent. At the very least, the agreements requiring 'membership' in a labor union which are expressly permitted by the proviso are the same 'membership' agreements expressly placed within the reach of state law by § 14(b). It follows that the General Motors case rules this one, for we there held that the 'agency shop' arrangement involved here—which imposes on employees the only membership obligation enforceable under § 8(a)(3) by discharge, namely, the obligation to pay initiation fees and regular dues—is the 'practical equivalent' of an 'agreement requiring membership in a labor organization as a condition of employment.' Whatever may be the status of less stringent union-security arrangements, the agency shop is within § 14(b). At least to that extent did Congress intend § 8(a)(3) and § 14(b) to coincide.
13
Petitioners, belatedly,4 would now distinguish the contract involved here from the agency shop contract dealt with in the General Motors case on the basis of allegedly distinctive features which are said to require a different result. Article 19 provides for nonmember payments to the union 'for the purpose of aiding the Union in defraying costs in connection with its legal obligations and responsibilities as the exclusive bargaining agent of the employees in the appropriate bargaining unit,' a provision which petitioners say confines the use of nonmember payments to collective bargaining purposes alone and forbids their use by the union for institutional purposes unrelated to its exclusive agency functions, all in sharp contrast, it is argued, to the General Motors situation where the nonmember contributions are available to the union without restriction.
14
We are wholly unpersuaded. There is before us little more than a complaint with its exhibits. The agency shop clause of the contract is, at best, ambiguous on its face and it should not, in the present posture of the case, be construed against respondent to raise a substantial difference between this and the General Motors case. There is no ironclad restriction imposed upon the use of nonmember fees, for the clause merely describes the payments as being for 'the purpose of aiding the Union' in meeting collective bargaining expenses. The alleged restriction would not be breached if the service fee was used for both collective bargaining and other expenses, for the union would be 'aided' in meeting its agency obligations, not only by the part spent for bargaining purposes but also by the part spent for institutional items, since an equivalent amount of other union income would thereby be freed to pay the costs of bargaining agency functions.
15
But even if all collections from nonmembers must be directly committed to paying bargaining costs, this fact is of bookkeeping significance only rather than a matter of real substance. It must be remembered that the service fee is admittedly the exact equal of membership initiation fees and monthly dues, see p. 749, supra,5 and that, as the union says in its brief,6 dues collected from members may be used for a 'variety of purposes, in addition to meeting the union's costs of collective bargaining.' Unions 'rather typically' use their membership dues 'to do those things which the members authorize the union to do in their interest and on their behalf.' If the union's total budget is divided between collective bargaining and institutional expenses and if nonmember payments, equal to those of a member, go entirely for collective bargaining costs, the nonmember will pay more of these expenses than his pro rata share. The member will pay less and to that extent a portion of his fees and dues is available to pay institutional expenses. The union's budget is balanced. By paying a larger share of collective bargaining costs the nonmember subsidizes the union's institutional activities. In overall effect, economically, and we think for the purposes of § 14(b), the contract here is the same as the General Motors agency shop arrangement. Petitioners' argument, if accepted, would lead to the anomalous result of permitting Florida to invalidate the agency shop but forbidding it to ban the present service fee arrangement under which collective bargaining services cost the nonmember more than the member.
II.
16
The more difficult phases of this case remain. In petitioners' motion to dismiss filed in the trial court the contract at issue was said to be an arguable unfair labor practice and the subject matter of the action therefore within the exclusive jurisdiction of the National Labor Relations Board and beyond the power of the state courts to prohibit. The motion was granted, but on another ground, and the preemption argument was renewed but rejected in the Florida Supreme Court. It is now pressed here and has at least two related but distinctive aspects.
17
It is first urged that whether or not a particular union-security contract is within the category subjected to state law by § 14(b) is a matter for the Board and no business of the state courts, at least in the doubtful cases where the coverage of § 14(b) is not a clearly settled matter. If a contract is not within § 14(b), the argument goes, it is protected by federal law. If within § 14(b), the arrangement is an unfair practice, at least arguably so. Therefore, where the status of a contract for the purposes of § 14(b) is at all doubtful, the Board is assertedly the tribunal to deal with the question. Although we were asked in the petition for certiorari, and again in petitioners' brief for oral argument, to resolve the § 14(b) issue in this agency shop case, the clear thrust of this phase of petitioners' preemption argument is that neither the Florida courts nor this Court should purport in the first instance to determine the status of an agency shop contract under § 14(b).
18
There is much force in the argument that the assessment of any union-security arrangement for the purposes of §§ 7, 8 and 14(b), when there is significant doubt about the matter, is initially a task for the Board, so that it may finally come to this Court with the benefit of the affected agency's views, and in all probability the preemption issue was entitled to different treatment than it received in the Florida courts at the time this case was decided. But what was then an arguable matter under § 14(b) is not necessarily arguable now. In the first place, as we have held in the General Motors case, an agency shop arrangement is the equivalent of a permitted § 8(a)(3) membership agreement, a result which rules this case since, as we have indicated, § 14(b) subjects to state law the membership agreements, or their equivalent, which are permitted by § 8(a)(3). Secondly, the Board's brief in the General Motors case contained the Board's own view of the status of the agency shop agreement under § 14(b): the provision conditioning employment upon the payment of sums equal to initiation fees and monthly dues is within the § 8(a)(3) proviso, within the scope of § 14(b), and hence subject to invalidation by state law. What was an arguable question of § 8(a)(3) and § 14(b) coverage has been settled, not only in the light of, but consistently with, the views of the Board. We see no reason to hold our hand at this juncture in order that the Board may arrive again at what is now a foregone conclusion. Cf. Federal Maritime Board v. Isbrandtsen Co., 356 U.S. 481, 78 S.Ct. 851, 2 L.Ed.2d 926.
19
The second question implicit in petitioners' preemption argument is whether a state court may enjoin the operation of an agency shop arrangement which the State has declared to be unlawful as it may do under § 14(b). Without the proviso to § 8(a)(3) and a similar saving clause in § 7, conditioning employment upon union membership would be an obvious unfair labor practice, under §§ 8(a)(1), 8(a)(3), and 8(b)(2), as Congress recognized in adding the proviso to original § 8(3). With the proviso, however, such arrangements, if they comply with the terms of the proviso, are not unfair practices. Section 14(b), with obvious reference to § 8(a)(3), declares that 'nothing in this Act' is to authorize 'the execution or application' of membership agreements in States in which such execution or operation is prohibited by state law. It is one thing if § 14(b) and a state law prohibiting the union or the agency shop have no impact on §§ 7 and 8 at all, and the union and agency shops are therefore not unfair practices under federal law even in those States which prohibit them. It is quite another matter, however, if § 14(b) removes the protection of the § 8(a)(3) proviso and the union and agency shops become unfair labor practices in States where state law forbids them, for then the obvious question is precipitated as to whether a State as well as the Board may enjoin such union-security arrangements. The scope and vitality of the Court's decision in Algoma Plywood & Veneer Co. v. Wisconsin Emp. Relations Board, 336 U.S. 301, 69 S.Ct. 584, 93 L.Ed. 691, are involved, as is the applicability of the preemption doctrine, subsequently developed in many cases in this Court, such as Garner v. Teamsters, etc., Union, 346 U.S. 485, 74 S.Ct. 161, 98 L.Ed. 228; San Diego Council v. Garmon, 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775, to situations where state law invalidates union-security contracts placed within their reach by § 14(b).
20
We hold that § 14(b) of the Act subjects this arrangement to state substantive law, and that the legality of Article 19 is governed by the decision of the Florida Supreme Court under review here. As to the unresolved issue of whether the Florida courts have jurisdiction to afford a remedy for violation of the state law, we prefer not to dispose of the matter without full argument next Term. Moreover, since we have not had the benefit of the views of the National Labor Relations Board, the Solicitor General is invited to file a brief expressing the views of the Government. The case is retained on the calendar and set for reargument during the forthcoming Term on the remaining issue.
21
It is so ordered.
22
Case retained on calendar and set for reargument.
23
Mr. Justice GOLDBERG took no part in the consideration or decision of this case.
1
Article 45 provides:
'This Agreement shall continue in effect from April 18, 1960 to April 15, 1963, and continue in effect from year to year thereafter unless either party notifies the other party sixty (60) days prior to expiration date, or any anniversary date thereafter, of their desire to terminate or open the agreement for the purpose of amendments and/or changes.'
2
'The right of persons to work shall not be denied or abridged on account of membership or non-membership in any labor union, or labor organization; provided, that this clause shall not be construed to deny or abridge the right of employees by the through a labor organization or labor union to bargain collectively with their employer.'
3
'Provided, That nothing in this Act, or in any other statute of the United States, shall preclude an employer from making an agreement with a labor organization * * * to require as a condition of employment membership therein on or after the thirtieth day following the beginning of such employment or the effective date of such agreement, whichever is the later * * *.'
4
The petition for certiorari posed the question for review as whether § 14(b) 'authorizes the states both to prohibit and to regulate an 'agency shop' clause.' The present clause was likened to, rather than distinguished from, the General Motors arrangement. It was only upon briefing and argument that petitioners sought to place this alleged 'service fee' contract in a different category from the agency shop. Cf. National Licorice Co. v. National Labor Relations Board, 309 U.S. 350, 357, n. 2, 60 S.Ct. 569, 574, 84 L.Ed. 799.
5
This is the factual posture in which the case comes to us, on motion to dismiss. The evidence on this point, if any favorable to petitioners was adduced at the hearing for preliminary injunction, was not made part of the record.
6
'Rather typically, unions use their members' dues to promote legislation which they regard as desirable and to defeat legislation which they regard as undesirable, to publish newspapers and magazines, to promote free labor institutions in other nations, to finance low cost housing, to aid victims of natural disaster, to support charities, to finance litigation, to provide scholarships, and to do those things which the members authorize the union to do in their interest and on their behalf.'
We cannot take seriously petitioners' unsupported suggestion at the oral argument that we must assume that the union spends all of its income on collective bargaining expenses. The record is entirely silent on this matter one way or the other and it would be unique indeed if the union expended no funds for noncollective bargaining purposes. See Brief for N.L.R.B., Labor Board v. General Motors Corp., No. 404, p. 38. As indicated in the text, petitioners' brief seems to concede as much and petitioners later appeared to modify or withdraw the suggestion at the oral argument. In any event, we have only the pleadings and we are bound to give the respondents the benefit of every reasonable inference from well-pleaded facts. Wheeldin v. Wheeler, 373 U.S. 647, 648, 83 S.Ct. 1441, 1443; Kendall v. United States, 7 Wall. 113, 116, 19 L.Ed. 85; State of Rhode Island v. Commonwealth of Massachusetts, 15 Pet. 233, 272, 10 L.Ed. 721.
| 67
|
376 U.S. 340
84 S.Ct. 755
11 L.Ed.2d 757
STATE OF ARIZONA, Plaintiff,v.STATE OF CALIFORNIA et al., Defendants.
No. 8, Original.
Supreme Court of the United States
March 9, 1964
DECREE
It is ordered, adjudged and decreed that
I. For purposes of this decree:
1
(A) 'Consumptive use' means diversions from the stream less such return flow thereto as is available for consumptive use in the United States or in satisfaction of the Mexican Treaty obligation;
2
(B) 'Mainstream' means the mainstream of the Colorado River downstream from Lee Ferry within the United States, including the reservoirs thereon;
3
(C) Consumptive use from the mainstream within a State shall include all consumptive uses of water of the mainstream, including water drawn from the mainstream by underground pumping, and including, but not limited to, consumptive uses made by persons, by agencies of that State, and by the United States for the benefit of Indian reservations and other federal establishments within the State;
4
(D) 'Regulatory structures controlled by the United States' refers to Hoover Dam, Davis Dam, Parker Dam, Headgate Rock Dam, Palo Verde Dam, Imperial Dam, Laguna Dam and all other dams and works on the mainstream now or hereafter controlled or operated by the United States which regulate the flow of water in the mainstream or the diversion of water from the mainstream;
5
(E) 'Water controlled by the United States' refers to the water in Lake Mead, Lake Mohave, Lake Havasu and all other water in the mainstream below Lee Ferry and within the United States; (F) 'Tributaries' means all stream systems the waters of which naturally drain into the mainstream of the Colorado River below Lee Ferry;
6
(G) 'Perfected right' means a water right acquired in accordance with state law, which right has been exercised by the actual diversion of a specific quantity of water that has been applied to a defined area of land or to definite municipal or industrial works, and in addition shall include water rights created by the reservation of mainstream water for the use of federal establishments under federal law whether or not the water has been applied to beneficial use;
7
(H) 'Present perfected rights' means perfected rights, as here defined, existing as of June 25, 1929, the effective date of the Boulder Canyon Project Act;
8
(I) 'Domestic use' shall include the use of water for household, stock municipal, m ning, milling, industrial, and other like purposes, but shall exclude the generation of electrical power;
9
(J) 'Annual' and 'Year,' except where the context may otherwise require, refer to calendar years;
10
(K) Consumptive use of water diverted in one State for consumptive use in another State shall be treated as if diverted in the State for whose benefit it is consumed.
11
II. The United States, its officers, attorneys, agents and employees be and they are hereby severally enjoined:
12
(A) From operating regulatory structures controlled by the United States and from releasing water controlled by the United States other than in accordance with the following order of priority:
13
(1) For river regulation, improvement of navigation, and flood control;
14
(2) For irrigation and domestic uses, including the satisfaction of present perfected rights; and
15
(3) For power;
16
Provided, however, that the United States may release water in satisfaction of its obligations to the United States of Mexico under the Treaty dated February 3, 1944, without regard to the priorities specified in this subdivision (A);
17
(B) From releasing water controlled by the United States for irrigation and domestic use in the State of Arizona, California and Nevada, except as follows:
18
(1) If sufficient mainstream water is available for release, as determined by the Secretary of the Interior, to satisfy 7,500,000 acre-feet of annual consumptive use in the aforesaid three States, then of such 7,500,000 acre-feet of consumptive use, there shall be apportioned 2,800,000 acre-feet for use in Arizona, 4,400,000 acre-feet for use in California, and 300,000 acre-feet for use in Nevada;
19
(2) If sufficient mainstream water is available for release, as determined by the Secretary of the Interior, to satisfy annual consumptive use in the aforesaid States in excess of 7,500,000 acre-feet, such excess consumptive use is surplus, and 50% thereof shall be apportioned for use in Arizona and 50% for use in California; provided, however, that if the United States so contracts with Nevada, then 46% of such surplus shall be apportioned for use in Arizona and 4% for use in Nevada;
20
(3) In insufficient mainstream water is available for release, as determined by the Secretary of the Interior, to satisfy annual consumptive use of 7,500,000 acre-feet in the aforesaid three States, then the Secretary of the Interior, after providing for satisfaction of present perfected rights in the order of their priority dates without regard to state lines and after consultation with the parties to major delivery contracts and such representatives as the respective States may designate, may apportion the amount remaining available for consumptive use in such manner as is consistent with the Boulder Canyon Project Act as interpreted by the opinion of this Court herein, and with other applicable federal statutes, but in no event shall more than 4,400,000 acre-feet be apportioned for use in California including all present perfected rights;
21
(4) Any mainstream water consumptively used within a State shall be charged to its apportionment, regardless of the purpose for which it was released;
22
(5) Notwithstanding the provisions of Paragraphs (1) through (4) of this subdivision (B), mainstream water shall be released or delivered to water users (including but not limited to public and municipal corporations and other public agencies) in Arizona, California, and Nevada only pursuant to valid contracts therefor made with such users by the Secretary of the Interior, pursuant to Section 5 of the Boulder Canyon Project Act or any other applicable federal statute;
23
(6) If, in any one year, water apportioned for consumptive use in a State will not be consumed in that State, whether for the reason that delivery contracts for the full amount of the State's apportionment are not in effect or that users cannot apply all of such water to beneficial uses, or for any other reason, nothing in this decree shall be construed as rohibiting the Secretary of the Interior from releasing such apportioned but unused water during such year for consumptive use in the other States. No rights to the recurrent use of such water shall accrue by reason of the use thereof;
24
(C) From applying the provisions of Article 7(d) of the Arizona water delivery contract dated February 9, 1944, and the provisions of Article 5(a) of the Nevada water delivery contract dated March 30, 1942, as amended by the contract dated January 3, 1944, to reduce the apportionment or delivery of mainstream water to users within the States of Arizona and Nevada by reason of any uses in such States from the tributaries flowing therein;
25
(D) From releasing water controlled by the United States for use in the States of Arizona, California, and Nevada for the benefit of any federal establishment named in this subdivision (D) except in accordance with the allocations made herein; provided, however, that such release may be made notwithstanding the provisions of Paragraph (5) of subdivision (B) of this Article; and provided further that nothing herein shall prohibit the United States from making future additional reservations of mainstream water for use in any of such States as may be authorized by law and subject to present perfected rights and rights under contracts theretofore made with water users in such State under Section 5 of the Boulder Canyon Project Act or any other applicable federal statute:
26
(1) The Chemehuevi Indian Reservation in annual quantities not to exceed (i) 11,340 acre-feet of diversions from the mainstream or (ii) the quantity of mainstream water necessary to supply the consumptive use required for irrigation of 1,900 acres and for the satisfaction of related uses, whichever of (i) or (ii) is less, with a priority date of February 2, 1907;
27
(2) The Cocopah Indian Reservation in annual quantities not to exceed (i) 2,744 acre-feet of diversions from the mainstream or (ii) the quantity of mainstream water necessary to supply the consumptive use required for irrigation of 431 acres and for the satisfaction of related uses, whichever of (i) or (ii) is less, with a priority date of September 27, 1917;
28
(3) The Yuma Indian Reservation in annual quantities not to exceed (i) 51,616 acre-feet of diversions from the mainstream or (ii) the quantity of mainstream water necessary to supply the consumptive use required for irrigation of 7,743 acres and for the satisfaction of related uses, whichever of (i) or (ii) is less, with a priority date of January 9, 1884;
29
(4) The Colorado River Indian Reservation in annual quantities not to exceed (i) 717,148 acre-feet of diversions from the mainstream or (ii) the quantity of mainstream water necessary to supply the consumptive use required for irrigation of 107,588 acres and for the satisfaction of related uses, whichever of (i) or (ii) is less, with priority dates of March 3, 1865, for lands reserved by the Act ofMarch 3, 1865 (13 Stat. 541, 559); November 22, 1873, for lands reserved by the Executive Order of said date; November 16, 1874, for lands reserved by the Executive Order of said date, except as later modified; May 15, 1876, for lands reserved by the Executive Order of said date; November 22, 1915, for lands reserved by the Executive Order of said date;
30
(5) The Fort Mohave Indian Reservation in annual quantities not to exceed (i) 122,648 acre-feet of diversions from the mainstream or (ii) the quantity of mainstream water necessary to supply the consumptive use required for irrigation of 18,974 acres and for the satisfaction of related uses, whichever of (i) or (ii) is less, and, subject to the next succeeding proviso, with priority dates of September 19, 1890, for lands transferred by the Executive Order of said date; February 2, 1911, for lands reserved by the Executive Order of said date; provided, however, that lands conveyed to the State of California pursuant to the Swamp Land Act (9 Stat. 519 (1850)) as well as any accretions thereto to which the owners of such land may be entitled, and lands patented to the Southern Pacific Railroad pursuant to the Act of July 27, 1866 (14 Stat. 292), shall not be included as irrigable acreage within the Reservation and that the above specified diversion requirement shall be reduced by 6.4 acre-feet per acre of such land that is irrigable; provided that the quantities fixed in this paragraph and paragraph (4) shall be subject to appropriate adjustment by agreement or decree of this Court in the event that the boundaries of the respective reservations are finally determined;
31
(6) The Lake Mead National Recreation Area in annual quantities reasonably necessary to fulfill the purposes of the Recreation Area, with priority dates of May 3, 1929, for lands reserved by the Executive Order of said date (No. 5105), and April 25, 1930, for lands reserved by the Executive Order of said date (No. 5339);
32
(7) The Havasu Lake National Wildlife Refuge in annual quantities reasonably necessary to fulfill the purposes of the Refuge, not to exceed (i) 41,839 acre-feet of water diverted from the mainstream or (ii) 37,339 acre-feet of consumptive use of mainstream water, whichever of (i) or (ii) is less, with a priority date of January 22, 1941, for lands reserved by the Executive Order of said date (No. 8647), and a priority date of February 11, 1949, for land reserved by the Public Land Order of said date (No. 559);
33
(8) The Imperial National Wildlife Refuge in annual quantities reasonably necessary to fulfill the purposes of the Refuge not to exceed (i) 28,000 acre-feet of water diverted from the mainstream or (ii) 23,000 acre-feet of consumptive use of mainstream water, whichever of (i) or (ii) is less, with a priority date of February 14, 1941;
34
(9) Boulder City, Nevada, as authorized by the Act of September 2, 1958, 72 Stat. 1726, with a priority date of May 15, 1931;
35
Provided, further, that consumptive uses from the mainstream for the benefit of the above-named federal establishments shall, except as necessary to satisfy present perfected rights in the order of their priority dates without regard to state lines, be satisfied only out of water available, as provided in subdivision (B) of this Article, to each State wherein such uses occur and subject to, in the case of each reservation, such rights as have been created prior to the establishment of such reservation by contracts executed under Section 5 of the Boulder Canyon Project Act or any other applicable federal statute.
36
III. The States of Arizona, California and Nevada, Palo Verde Irrigation District, Imperial Irrigation District, Coachella Valley County Water District, Metropolitan Water District of Southern California, City of Los Angeles, City of San Diego, and County of San Diego, and all other users of water from the mainstream in said States, their officers, attorneys, agents and employees, be and they are hereby severally enjoined:
37
(A) From interfering with the management and operation, in conformity with Article II of this decree, of regulatory structures controlled by the United States;
38
(B) From interfering with or purporting to authorize the interference with releases and deliveries, in conformity with Article II of this decree, of water controlled by the United States;
39
(C) From diverting or purporting to authorize the diversion of water from the mainstream the diversion of which has not been authorized by the United States for use in the respective States; provided, however, that no party named in this Article and no other user of water in said States shall divert or purport to authorize the diversion of water from the mainstream the diversion of which has not been authorized by the United States for its particular use;
40
(D) From consuming or purporting to authorize the consumptive use of water from the mainstream in excess of the quantities permitted under Article II of this decree.
41
IV. The State of New Mexico, its officers, attorneys, agents and employees, be and they a e after four years from the date of this decree hereby severally enjoined:
42
(A) From diverting or permitting the diversion of water from San Simon Creek, its tributaries and underground water sources for the irrigation of more than a total of 2,900 acres during any one year, and from exceeding a total consumptive use of such water, for whatever purpose, of 72,000 acre-feet during any period of ten consecutive years; and from exceeding a total consumptive use of such water, for whatever purpose, of 8,220 acre-feet during any one year; (B) From diverting or permitting the diversion of water from the San Francisco River, its tributaries and underground water sources for the irrigation within each of the following areas of more than the following number of acres during any one year:
Luna Area............... 225
Apache Creek-Aragon Area. 316
Reserve Area............ 725
Glenwood Area......... 1,003
43
and from exceeding a total consumptive use of such water for whatever purpose, of 31,870 acre feet during any period of ten consecutive years; and from exceeding a total consumptive use of such water, for whatever purpose, of 4,112 acre feet during any one year;
44
(C) From diverting or permitting the diversion of water from the Gila River, its tributaries (exclusive of the San Francisco River and San Simon Creek and their tributaries) and underground water sources for the irrigation within each of the following areas of more than the following number of acres during any one year:
Upper Gila Area.............. 287
45
Cliff-Gila and Buckhorn-Duck Creek Area. 5,314
Red Rock Area.............. 1,456
46
and from exceeding a total consumptive use of such water (exclusive of uses in Virden Valley, New Mexico), for whatever purpose, of 136,620 acre-feet during any period of ten consecutive years; and from exceeding a total consumptive use of such water (exclusive of uses in Virden Valley, New Mexico), for whatever purpose, of 15,895 acre-feet during any one year;
47
(D) From diverting or permitting the diversion of water from the Gila River and its underground water sources in the Virden Valley, New Mexico, except for use on lands determined to have the right to the use of such water by the decree entered by the United States District Court for the District of Arizona on June 29, 1935, in United States v. Gila Valley Irrigation District et al. (Globe Equity No. 59) (herein referred to as the Gila Decree), and except pursuant to and in accordance with the terms and provisions of the Gila Decree; provided, however, that:
48
(1) This decree shall not enjoin the use of underground water on any of the following lands:
49
Owner Subdivision and Legal Sec. Twp. Rng. Acreage
Description
Marvin Arnett
50
and J.C. Part Lot 3.. 6. 19S. 21W 33.84
51
O'Dell. Part Lot 4.. 6. 19S. 21W 52.33
NW 1/4 SW 1/4 5.......... 19S. 21W. 38.36
SW 1/4 SW 1/4 5.......... 19S. 21W. 39.80
52
Part Lot 1 7.......... 19S. 21W. 50.68
53
Hyrum M. Pace,
54
Ray Richardson,...... NW 1/4 NW 1/4. 8 19S 21W 38.03
55
Harry Day SW 1/4 NE 1/4. 12. 19S 21W 8.00
56
and N.O. Pace, Est... SW 1/4 NE 1/4. 12 19S 21W 15.00
SE 1/4 NE 1/4 12......... 19S. 21W. 7.00
57
C. C. Martin S. part SE 1/4 SW 1/4 SE 1/4 1 19S 21W 0.93
58
W 1/2 W 1/2 W 1/2 NE 1/4 NE 1/4. 12. 19S 21W 0.51
NW 1/4 NE 1/4 12......... 19S. 21W. 18.01
59
A. E. Jacobson SW part lot 1. 6. 19S. 21W 11.58
60
W. LeRoss Jones E. Central part: E 1/2 E 1/2 E 1/2 12 19S 21W 0.70
61
NW 1/4 NW 1/4.
62
SW part NE 1/4 NW 1/4...... 12. 19S. 21W 8.93
63
N. Central part: N 1/2 N 1/2 NW 1/4. 12 19S 21W 0.51
64
SE 1/4 NW 1/4.
Conrad and James
65
R. Donaldson N 1/2 N 1/2 N 1/2 SE 1/4 18 19S 20W 8.00
66
James D. Freestone.. Part W 1/2 NW 1/4. 33 18S 21W 7.79
67
Virgil W. Jones N 1/2 SE 1/4 NW 1/4; SE 1/4 NE 1/4 12 19S 21W 7.40
NW 1/4
68
Darrell Brooks SE 1/4 SW 1/4. 32. 18S 21W 6.15
69
Floyd Jones Part N 1/2 SE 1/4 NE 1/4 13 19S 21W 4.00
70
Part NW 1/4 SW 1/4 NW 1/4.. 18. 19S. 20W 1.70
71
L. M. Hatch SW 1/4 SW 1/4. 32. 18S 21W 4.40
72
Virden Townsite ----....... ----. ---- 3.90
73
Carl M. Donaldson..... SW 1/4 SE 1/4. 12 19S 21W 3.40
74
Mack Johnson Part NW 1/4 NW 1/4 NE 1/4 10 19S 21W 2.80
75
Part NE 1/4 NW 1/4 NE 1/4.. 10. 19S. 21W 0.30
76
Part N 1/2 N 1/2 S 1/2 NW 1/4 NE 1/4. 10 19S 21W 0.10
77
Chris Dotz SE 1/4 SE 1/4; SW 1/4 SE 1/4 3 19S 21W)
78
NW 1/4 NE 1/4; NE 1/4 NE 1/4. 10. 19S 21W) 2.66
79
Roy A. Johnson NE 1/4 SE 1/4 SE 1/4. 32 19S 21W 1.00
80
Ivan and Antone Thygerson. NE 1/4 SE 1/4 SE 1/4 34 18S 21W 1.00
81
John W. Bonine SW 1/4 SE 1/4 SW 1/4. 33 18S 21W 1.00
82
Marion K. Mortenson. SW 1/4 SW 1/4 SE 1/4 4 18S 21W 1.00 ____
83
Total 380.81 or on lands or for other uses in the Virden Valley to which such use may be transferred or substituted on retirement from irrigation of any of said specifically described lands, up to a maximum total consumptive use of such water of 838.2 acre feet per annum, unless and until such uses are adjudged by a court of competent jurisdiction to be an infringement or impairment of rights confirmed by the Gila Decree; and
84
(2) This decree shall not prohibit domestic use of water from the Gila River and its underground water sources on lands with rights confirmed by the Gila Decree, or on farmsteads located adjacent to said lands, or in the Virden Townsite, up to a total consumptive use of 265 acre-feet per annum in addition to the uses confirmed by the Gila Decree, unless and until such use is adjudged by a court of competent jurisdiction to be an infringement or impairment of rights confirmed by the Gila Decree;
85
(E) Provided, however, that nothing in this Article IV shall be construed to affect rights as between individual water users in the State of New Mexico; nor shall anything in this Article be construed to affect possible superior rights of the United States asserted on behalf of National Forests, Parks, Memorials, Monuments and lands administered by the Bureau of Land Management; and provided further that in addition to the diversions authorized herein the United States has the right to divert water from the mainstream of the Gila and San Francisco Rivers in quantities reasonably necessary to fulfill the purposes of the Gila National Forest with priority dates as of the date of withdrawal for forest purposes of each area of the forest within which the water is used;
86
(F) Provided, further, that no diversion from a stream authorized in Article IV(A) through (D) may be transferred to any of the other streams, nor may any use for irrigation purposes within any area on one of the streams be transferred for use for irrigation purposes to any other area on that stream.
87
V. The United States shall prepare and maintain, or provide for the preparation and maintenance of, and shall make available, annually and at such shorter intervals as the Secretary of the Interior shall deem necessary or advisable, for inspection by interested persons at all reasonable times and at a reasonable place or places, complete, detailed and accurate records of:
88
(A) Releases of water through regulatory structures controlled by the United States;
89
(B) Diversions of water from the mainstream, return flow of such water to the stream as is available for consumptive use in the United States or in satisfaction of the Mexican Treaty obligation, and consumptive use of such water. These quantities shall be stated separately as to each diverter from the mainstream, each point of diversion, and each of the States of Arizona, California and Nevada;
90
(C) Releases of mainstream water pursuant to orders therefor but not diverted by the party ordering the same, and the quantity of such water delivered to Mexico in satisfaction of the Mexican Treaty or diverted by others in satisfaction of rights decreed herein. These quantities shall be stated separately as to each diverter from the mainstream, each point of diversion, and each of the States of Arizona, California and Nevada;
91
(D) Deliveries to Me ico of water in satisfaction of the obligations of Part III of the Treaty of February 3, 1944, and, separately stated, water passing to Mexico in excess of treaty requirements;
92
(E) Diversions of water from the mainstream of the Gila and San Francisco Rivers and the consumptive use of such water, for the benefit of the Gila National Forest.
93
VI. Within two years from the date of this decree, the States of Arizona, California, and Nevada shall furnish to this Court and to the Secretary of the Interior a list of the present perfected rights, with their claimed priority dates, in waters of the mainstream within each State, respectively, in terms of consumptive use, except those relating to federal establishments. Any named party to this proceeding may present its claim of present perfected rights or its opposition to the claims of others. The Secretary of the Interior shall supply similar information, within a similar period of time, with respect to the claims of the United States to present perfected rights within each State. If the parties and the Secretary of the Interior are unable at that time to agree on the present perfected rights to the use of mainstream water in each State, and their priority dates, any party may apply to the Court for the determination of such rights by the Court.
94
VII. The State of New Mexico shall, within four years from the date of this decree, prepare and maintain, or provide for the preparation and maintenance of, and shall annually thereafter make available for inspection at all reasonable times and at a reasonable place or places, complete, detailed and accurate records of:
95
(A) The acreages of all lands in New Mexico irrigated each year from the Gila River, the San Francisco River, San Simon Creek, and their tributaries and all of their underground water sources, stated by legal description and component acreages and separately as to each of the areas designated in Article IV of this decree and as to each of the three streams;
96
(B) Annual diversions and consumptive uses of water in New Mexico, from the Gila River, the San Francisco River, San Simon Creek, and their tributaries and all their underground water sources, stated separately as to each of the three streams.
VIII. This decree shall not affect:
97
(A) The relative rights inter sese of water users within any one of the States, except as otherwise specifically provided herein; (B) The rights or priorities to water in any of the Lower Basin tributaries of the Colorado River in the States of Arizona, California, Nevada, New Mexico and Utah except the Gila River System;
98
(C) The rights or priorities, except as specific provision is made herein, of any Indian Reservation, National Forest, Park, Recreation Area, Monument or Memorial, or other lands of the United States;
99
(D) Any issue of interpretation of the Colorado River Compact.
100
IX. Any of the parties may apply at the foot of this decree for its amendment or for further relief. The Court retains jurisdiction of this suit for the purpose of any order, direction, or modification of the decree, or any supplementary decree, that may at any time be deemed proper in relation to the subject matter in controversy.
101
Mr. Justice DOUGLAS dissents.
102
Mr. Justice HARLAN and Mr. Justice STEWART dissent to the extent that the decree conflicts with the views expressed in the dissenting opinion of Mr. Justice HARLAN, 373 U.S. 546, 603, 83 S.Ct. 1468, 1499, 10 L.Ed.2d 542.
103
THE CHIEF JUSTICE took no part in the consideration or decision of this case.
| 1011
|
373 U.S. 683
83 S.Ct. 1405
10 L.Ed.2d 632
Josephine GOSS et al., Petitioners,v.The BOARD OF EDUCATION OF the CITY OF KNOXVILLE, TENNESSEE, et al.
No. 217.
Argued March 20 and 21, 1963.
Decided June 3, 1963.
Jack Greenberg, New York City, for petitioners.
Harlan Dodson, Nashville, Tenn., and S. Frank Fowler, Knoxville, Tenn., for respondents.
Burke Marshall, Washington, D.C., for the United States, as amicus curiae.
Jack Petree, Memphis, Tenn., for Board of Education of Memphis City Schools, as amicus curiae.
Mr. Justice CLARK delivered the opinion of the Court.
1
We granted certiorari (371 U.S. 811, 83 S.Ct. 38, 9 L.Ed.2d 53) limited to the question whether petitioners, Negro school children seeking desegregation of the public school systems of Knoxville, Tennessee (the Goss case), and Davidson County, Tennessee, an area adjacent to Nashville (the Maxwell case), are deprived of rights under the Fourteenth Amendment. The question centers around substantially similar transfer provisions incorporated in formal desegregation plans adopted by the respective local school boards pursuant to court orders. The claim is that the transfer programs are invalid because they are based solely on race and tend to perpetuate the pre-existing racially segregated school system. Under the overall desegregation plans presented to the trial courts, school districts would be rezoned without reference to race. However, by the terms of the transfer provisions, a student, upon request, would be permitted, solely on the basis of his own race and the racial composition of the school to which he has been assigned by virtue of rezoning, to transfer from such school, where he would be in the racial minority, back to his former segregated school where his race would be in the majority. The appropriate District Courts and the Court of Appeals approved the transfer plans. 301 F.2d 164, 301 F.2d 828. The transfer plans being based solely on racial factors which, under their terms, inevitably lead toward segregation of the students by race, we conclude that they run counter to the admonition of Brown v. Board of Education of Topeka, 349 U.S. 294, 301, 75 S.Ct. 753, 756, 99 L.Ed. 1083 (1955), wherein the District Courts were directed to 'consider the adequacy of any plans' proposed by school authorities 'to effectuate a * * * racially nondiscriminatory school system.' Our conclusion here leads to a reversal of the judgments of the Court of Appeals to the extent they approve the transfer provisions of respondent boards in each of the cases. The only question with which we are here concerned relates solely to the transfer provisions, and we are not called upon either to discuss or to pass on the other provisions of the desegregation plans.1
I.
2
These cases were brought by Negro public school pupils and their parents as class actions against the respective school authorities. They challenged, among other points in the desegregation plans not here relevant, the transfer provisions which permitted a pupil to transfer, upon request, from the zone of his residence to another school. The transfer plans are essentially the same, each containing, in addition to the provisions at issue here, general provisions providing for transfers on a showing of 'good cause.'2 The crucial provisions, however, present in somewhat the same form in each plan, is examplified by § 6 of the Knoxville plan:
3
'6. The following will be regarded as some of the valid conditions to support requests for transfer:
4
'a. When a white student would otherwise be required to attend a school previously serving colored students only;
5
'b. When a colored student would otherwise be required to attend a school previously serving white students only;
6
'c. When a student would otherwise be required to attend a school where the majority of students of that school or in his or her grade are of a different race.'
7
This provision is attacked as providing recial factors as valid conditions to support transfers which by design and operation would perpetuate racial segregation. It is also said that no showing is made that the transfer provisions are essential to effectuation of desegregation and that other procedures are available.
II.
8
It is readily apparent that the transfer system proposed lends itself to perpetuation of segregation. Indeed, the provisions can work only toward that end. While transfer are available to those who choose to attend school where their race is in the majority, there is no provision whereby a student might transfer upon request to a school in which his race is in a minority, unless he qualifies for a 'good cause' transfer. As the Superintendent of Davidson County's schools agreed, the effect of the racial transfer plan was 'to permit to child (or his parents) to choose segregation outside of his zone but not to choose integration outside of his zone.' Here the right of transfer, which operates solely on the basis of a racial classification, is a one-way ticket leading to but one destination, i.e., the majority race of the transferee and continued segregation. This Court has decided that state-imposed separation in public schools is inherently unequal and results in discrimination in violation of the Fourteenth Amendment. Brown v. Board of Education of Topeka, 347 U.S. 483, 74 S.Ct. 686, 98 L.Ed. 873 (1954). Our task then is to decide whether these transfer provisions are likewise unconstitutional. In doing so, we note that if the transfer provisions were made available to all students regardless of their race and regardless as well of the racial composition of the school to which he requested transfer we would have an entirely different case. Pupils could then at their option (or that of their parents) choose, entirely free of any imposed racial considerations, to remain in the school of their zone or to transfer to another.
III.
9
Classifications based on race for purposes of transfers between public schools, as here, violate the Equal Protection Clause of the Fourteenth Amendment. As the Court said in Steele v. Louisville & Nashville R. Co., 323 U.S. 192, 203, 65 S.Ct. 226, 89 L.Ed. 173 (1944), racial classifications are 'obviously irrelevant and invidious.' The cases of this Court reflect a variety of instances in which racial classifications have been held to he invalid, e.g., public parks and playgrounds, Watson v. City of Memphis, 373 U.S. 526, 83 S.Ct. 1314 (1963); trespass convictions, where local segregation ordinances preempt private choice, Peterson v. City of Greenville, 373 U.S. 244, 83 S.Ct. 1119 (1963); seating in courtrooms, Johnson v. Virginia, 373 U.S. 61, 83 S.Ct. 1053 (1963); Restaurants in public buildings, Burton v. Wilmington Parking Authority, 365 U.S. 715, 81 S.Ct. 856, 6 L.Ed.2d 45 (1961); bus terminals, Boynton v. Com. of Virginia, 364 U.S. 454, 81 S.Ct. 182, 5 L.Ed.2d 206 (1960); public schools, Brown v. Board of Education, supra; railroad dining-car facilities, henderson v. United States, 339 U.S. 816, 70 S.Ct. 843, 94 L.Ed. 1302 (1950); state enforcement of restrictive covenants based on race, Shelley v. Kraemer, 334 U.S. 1, 68 S.Ct. 836, 92 L.Ed. 1161 (1948); labor unions acting as statutory representatives of a craft, Steele v. Louisville & Nashville R. Co., supra; voting, Smith v. Allwright, 321 U.S. 649, 64 S.Ct. 757, 88 L.Ed. 987 (1944); and juries, Strauder v. West Virginia, 100 U.S. 303, 25 L.Ed. 664 (1879). The recognition of race as an absolute criterion for granting transfers which operate only in the direction of schools in which the transferee's race is in the majority is no less unconstitutional than its use for original admission or subsequent assignment to public schools. See Boson v. Rippy, 285 F.2d 43 (C.A.5th Cir.).
10
The alleged equality—which we view as only superficial—of enabling each race to transfer from a desegregated to a segregated school does not save the plans. Like arguments were made without success in Brown, supra, in support of the separate but equal educational program. Not only is race the factor upon which the transfer plans operate, but also the plans lack a provision whereby a student might with equal facility transfer from a segregated to a desegregated school. The obvious one-way operation of these two factors in combination underscores the purely racial character and purpose of the transfer provisions. We hold that the transfer plans promote discrimination and are therefore invalid.
11
This is not to say that appropriate transfer provisions, upon the partents' request, consistent with sound school administration and not based upon any state-imposed racial conditions, would fall. Likewise, we would have a different case here if the transfer provisions were unrestricted, allowing transfers to or from any school regardless of the race of the majority therein. But no official transfer plan or provision of which racial segregation is the inevitable consequence may stand under the Fourteenth Amendment.
12
In reaching this result we are not unmindful of the deep-rooted problems involved. Indeed, it was consideration for the multifarious local difficulties and 'variety of obstacles= which might arise in this transition that led this Court eight years ago to frame its mandate in Brown in such language as 'good faith compliance at the earliest practicable date' and 'all deliberate speed.' Brown v. Board of Education, 349 U.S., at 300, 301, 75 S.Ct. at 756. Now, however, eight years after this decree was rendered and over nine years after the first Brown decision, the context in which we must interpret and apply this language to plans for desegregation has been significantly altered. Compare Watson v. City of Memphis, supra. The transfer provisions here cannot be deemed to be reasonably designed to meet legitimate local problems, and therefore do not meet the requirements of Brown. Accordingly, the decisions of the Court of Appeals, insofar as they approve the transfer provisions submitted by the boards of education of Knoxville, Tennessee, and Davidson County, Tennessee, are reversed and the cases are remanded to the Court of Appeals with directions to remand to the District Courts for further proceedings in accordance with this opinion.
13
Reversed and remanded.
1
A full discussion of the Knoxville plans may be found in the opinion of the Court of Appeals, 301 F.2d 164, which affirmed, with modifications not relevant here, the over-all plan, including the transfer provisions. Likewise the opinion of the Court of Appeals in Maxwell v. County Board of Education of Davidson County, 301 F.2d 828, affirmed the action of the District Court in approving the Davidson County plan, including the transfer provisions which are set out in detail in that opinion.
2
The Knoxville Plan provides (R. 31):
'5. Requests for transfer of students in desegregated grades from the school of their Zone to another school will be given full consideration and will be granted when made in writing by parents or guardians or those acting in the position of parents, when good cause therefor is shown and when transfer is practicable, consistent with sound school administration.'
The Davidson County Plan provides (R. 214):
'4. Application for transfer of first grade students, and subsequent grades according to the gradual plan, from the school of their zone to another school will be given careful consideration and will be granted when made in writing by parents, guardians, or those acting in the position of parents, when good cause therefor is shown and when transfer is practicable and consistent with sound school administration.'
| 12
|
373 U.S. 709
83 S.Ct. 1409
10 L.Ed.2d 652
UNITED STATES, Petitioner,v.CARLO BIANCHI AND COMPANY, Inc.
No. 529.
Argued April 29, 1963.
Decided June 3, 1963.
David L. Rose, Washington, D.C., for petitioner.
William H. Matthews, Washington, D.C., for respondent.
Mr. Justice HARLAN delivered the opinion of the Court.
1
This case involves the interpretation and application of the 'Wunderlich Act,' 68 Stat. 81, 41 U.S.C. §§ 321—322,1 an Act designed to permit judicial review of decisions made by federal departments and agencies under standard 'disputes' clauses2 in government contracts. The issue before us is whether, in a suit governed by this statute, the court is restricted to a review of the administrative record on issues of fact submitted to administrative determination or is free to receive new evidence on such issues.
2
In 1946, the respondent, Carlo Bianchi and Company, entered into a contract with the Army Corps of Engineers for the construction of a flood-control dam. Included in the work to be performed was the construction of a 710-foot tunnel, designed for the diversion of water, to be lined with concrete and to have permanent steel supports as protection for a 50-foot section at either end. The specifications did not call for such permanent supports throughout the remainder of the tunnel but only for '(t)emporary tunnel protection * * * where required for safety of the workmen.' The contract contained a standard 'changed conditions' clause, authorizing the contracting officer to provide for an increase in cost if the contractor encountered subsurface conditions materially different from those indicated in the contract or to be reasonably anticipated, and also contained the standard 'disputes' clause quoted, supra, note 2.
3
After the tunnel had been drilled by a subcontractor, but before it was lined with concrete, the respondent took the position that unforeseen conditions created extreme hazards for workmen, requiring permanent protection throughout the tunnel, and that it should be compensated for installing such protection. The contracting officer decided that compensation would not be made, and pursuant to the 'disputes' clause a timely appeal from his decision was taken to the Board of Claims and Appeals of the Corps of Engineers. While the appeal was pending, respondent installed the tunnel supports and completed work on the tunnel.
4
An adversary hearing was held before the Board, at which a record was made and each side offered its evidence and had an opportunity for cross-examination. In December 1948, the Board issued a decision against the contractor, resolving certain conflicts in the evidence in favor of the Government and holding in substance that there were no unanticipated or unforeseen conditions requiring the use of permanent steel protection throughout the tunnel.
5
Almost six years later, in December 1954, respondent brought the present action for breach of contract in the Court of Claims, seeking substantial damages and alleging that the decisions of the contracting officer and the Board were 'capricious or arbitrary or so grossly erroneous as necessarily to imply bad faith, or were not supported by substantial evidence.' At a hearing before a Commissioner in 1956, the Government took the position that on the question whether the Board's decision was entitled to be considered final, no evidence was admissible except the record before the Board. But the Commissioner received evidence de novo, including, over government objection, a substantial amount of evidence that had not been before the Board. He subsequently made extensive findings of fact and concluded that the respondent was entitled to recover.
6
In an opinion issued in January 1959, the Court of Claims accepted the Commissioner's findings and conclusions, ruling that 'on consideration of all the evidence, the contracting officer's decision (as affirmed by the Board) cannot be said to have substantial support,' and thus 'does not have finality.' 169 F.Supp. 514, 517, 144 Ct.Cl. 500, 506. On the question whether it was limited in its consideration to the evidence before the Board, the court stated:
7
'In our opinion in Volentine and Littleton v. United States, 145 F.Supp. 952, 136 Ct.Cl. 638, holding that the trial in this court should not be limited to the record made before the contracting agency, but should be de novo, we recognized that there were logical weaknesses in our position. We concluded, however, that the intent of Congress in enacting the Wunderlich Act was in accord with our conclusion, and we adhere to that conclusion in this case.' Ibid.
8
After receiving additional evidence on damages, the court entered judgment for respondent in the amount of $149,617.36. We granted certiorari, 371 U.S. 939, 83 S.Ct. 321, 9 L.Ed.2d 274, to resolve a conflict among the lower courts3 on the important question of the kind of judicial proceeding to be afforded in cases governed by the Wunderlich Act.
I.
9
The jurisdiction of the Court of Claims in the present case is conferred by 28 U.S.C. § 1491, since this is a suit for judgment against the United States 'founded' upon an 'express or implied contract with the United States.' Ordinarily, when questions of fact arise in such suits, the function of the court is to receive evidence and to make appropriate findings as to the facts in dispute. But this Court long ago upheld the validity of clauses in government contracts delegating to a government employee the authority to make determinations of disputed questions of fact, and required such determinations to be given conclusive effect in any subsequent suit in the absence of fraud or gross mistake implying fraud or bad faith. See Kihlberg v. United States, 97 U.S. 398, 24 L.Ed. 1106; Ripley v. United States, 223 U.S. 695, 32 S.Ct. 352, 56 L.Ed. 614. Thus the function of the Court of Claims in matters governed by 'disputes' clauses was in effect to give an extremely limited review of the administrative decision, and although the scope of review was somewhat expanded by that court over the years,4 it was expressly restricted in United States v. Wunderlich, 342 U.S. 98, 100, 72 S.Ct. 154, 155, 96 L.Ed. 113, to determining whether or not the departmental decision had been founded on fraud, i.e., 'conscious wrongdoing, an intention to cheat or be dishonest.'
10
The Wunderlich decision, rendered over strong dissents, evoked considerable effort to obtain legislation expanding the scope of review beyond questions of fraud. A number of bills were introduced in the Eighty-second and Eighty-third Congresses; hearings were held in the Senate5 and House of Representatives;6 and the resulting statute known as the 'Wunderlich Act' was ultimately approved by both Houses in 1954. This statute, quoted in full in note 1, supra, is entitled an Act 'To permit review of decisions of the heads of departments * * * involving questions arising under Government contracts,' and provides in substance that a departmental decision on a question of fact rendered pursuant to a 'disputes' clause shall be final and conclusive in accordance with the provisions of the contract
11
'unless the same is fraudulent or capricious or arbitrary or so grossly erroneous as necessarily to imply bad faith, or is not supported by substantial evidence.'
12
Respondent has not argued in this Court that the underlying controversy in the present suit is beyond the scope of the 'disputes' clause in the contract or that it is not governed by the quoted language in the Wunderlich Act. Thus the sole issue, as stated supra, p. 710, is whether the Court of Claims is limited to the administrative record with respect to that controversy or is free to take new evidence. In considering this issue, we put to one side questions of fraud, which are not involved in this case, which normally require the receipt of evidence outside the administrative record for their resolution, and which could be considered in judicial proceedings even prior to the enactment of the statute.
13
It is our conclusion that, apart from questions of fraud, determination of the finality to be attached to a departmental decision on a question arising under a 'disputes' clause must rest solely on consideration of the record before the department. This conclusion is based both on the language of the statute and on its legislative history.
14
1. With respect to the language used, we note that the statute is designated as an Act 'To permit review' and that the reviewing function is one ordinarily limited to consideration of the decision of the agency or court below and of the evidence on which it was based. Indeed, in cases where Congress has simply provided for review, without setting forth the standards to be used or the procedures to be followed, this Court has held that consideration is to be confined to the administrative record and that no de novo proceeding may be held. Tagg Bros. & Moorhead v. United States, 280 U.S. 420, 50 S.Ct. 220, 74 L.Ed. 524; National Broadcasting Co. v. United States, 319 U.S. 190, 227, 63 S.Ct. 997, 1014, 87 L.Ed. 1344. And of course, as shown by the Tagg Bros. and NBC cases themselves, the function of reviewing an administrative decision can be and frequently is performed by a court of original jurisdiction as well as by an appellate tribunal.
15
Moreover, the standards of review adopted in the Wunderlich Act—'arbitrary,' 'capricious,' and 'not supported by substantial evidence'—have frequently been used by Congress and have consistently been associated with a review limited to the administrative record.7 The term 'substantial evidence' in particular has become a term of art to describe the basis on which an administrative record is to be judged by a reviewing court. This standard goes to the reasonableness of what the agency did on the basis of the evidence before it, for a decision may be supported by substantial evidence even though it could be refuted by other evidence that was not presented to the decision-making body.
16
2. The legislative history supports our conclusion that the language used in the Act should be given its customary meaning. It is true that several witnesses representing contractors explained the purpose of the proposed legislation as restoring rights the contractors had before Wunderlich,8 and that it had apparently been the practice of the Court of Claims to receive evidence on matters covered by 'disputes' clauses.9 But is seems clear in context that these witnesses meant only that the standards of review should cover more than conscious fraud, as the Court of Claims had assumed prior to Wunderlich. Indeed with respect to the procedural significance of the substantial evidence test, a leading contractor's representative stated that it would
17
'result in these various departments and agencies feeling that they will have to produce their witnesses at these hearings and permit the contractor to examine them, in order to have in the record some substantial evidence to support their decisions when they go up on appeal to the court.'10
18
The House Report recommending the bill ultimately enacted leaves little doubt that the review intended was one confined to the administrative record. H.R.Rep.No. 1380, 83d Cong., 2d Sess.; U.S. Code Congressional and Administrative News 1954, p. 2191 et seq. The explicit references to the Administrative Procedure Act, 60 Stat. 243, 5 U.S.C. § 1009, and to this Court's discussion of the standards of review in Consolidated Edison Co. of New York v. National Labor Relations Board, 305 U.S. 197, 229, 59 S.Ct. 206, 216, 83 L.Ed. 126, are only the least indications. Even more significant is the Committee's view, echoing that of the witness quoted above, that the standards proposed would remedy the practice in many departments of failing to acquaint the contractor with the evidence in support of the Government's position:
19
'It is believed that if the standard of substantial evidence is adopted this condition will be corrected and that the records of hearing officers will hereafter contain all of the testimony and evidence upon which they have relied in making their decisions. It would not be possible to justify the retention of the finality clauses in Government contracts unless the hearing procedures were conducted in such a way as to require each party to present openly its side of the controversy and afford an opportunity of rebuttal.' H.R.Rep. No. 1380, 83d Cong., 2d Sess. 5; U.S. Code Congressional and Administrative News 1954, p. 2195.
20
This sound and clearly expressed purpose would be frustrated if either side were free to withhold evidence at the administrative level and then to introduce it in a judicial proceeding. Moreover, the consequence of such a procedure would in many instances be a needless duplication of evidentiary hearings and a heavy additional burden in the time and expense required to bring litigation to an end. Thus in the present case judicial proceedings began in 1954, almost six years after completiton of the departmental proceedings, and a final decision on the issue of liability was not rendered until 1959. This is surely delay at its worst, and we would be loath to condone any procedure under which the need for expeditious resolution would be so ill-served. Here the procedure is clearly inconsistent with the legislative directive.
21
It is contended that the Court of Claims has no power to remand a case such as this to the department concerned, cf. United States v. Jones, 336 U.S. 641, 670—671, 69 S.Ct. 787, 802—803, 93 L.Ed. 938, and thus if the administrative record is defective or inadequate, or reveals the commission of some prejudicial error, the court can only hold an evidentiary hearing and proceed to judgment. There are, we believe, two answers to this contention. First, there would undoubtedly be situations in which the court would be warranted, on the basis of the administrative record, in granting judgment for the contractor without the need for further administrative action. Second, in situations where the court believed that the existing record did not warrant such a course, but that the departmental determination could not be sustained under the standards laid down by Congress, we see no reason why the court could not stay its own proceedings pending some further action before the agency involved. Cf. Pennsylvania R. Co. v. United States, 363 U.S. 202, 80 S.Ct. 1131, 4 L.Ed.2d 1165. Such a stay would certainly be justified where the department had failed to make adequate provision for a record that could be subjected to judicial scrutiny, for it was clearly part of the legislative purpose to achieve uniformity in this respect. And in any case in which the department failed to remedy the particular substantive or procedural defect or inadequacy, the sanction of judgment for the contractor would always be available to the court.
II.
22
In its argument here, the Government has urged that if judicial review is confined to the administrative record, it must be concluded that the Board's determination is supported by substantial evidence and thus is entitled to finality under the Wunderlich Act. The respondent, on the other hand, contends that there were several irregularities in the Board's procedures that preclude giving its determination conclusive effect.
23
Neither of these matters is properly embraced within our grant of certiorari, and we are therefore not called upon to pass on them. We hold only that in its consideration of matters within the scope of the 'disputes' clause in the present case, the Court of Claims is confined to review of the administrative record under the standards in the Wunderlich Act and may not receive new evidence. We therefore vacate the judgment below and remand the case for further proceedings in conformity with this opinion. It is so ordered.
24
Judgment vacated and case remanded.
25
Mr. Justice DOUGLAS, with whom Mr. Justice STEWART concurs, dissenting.
26
The petition to the Court of Claims alleged that changed subsurface conditions required respondent to install permanent tunnel protection by the use of steel arch ribs and steel liner plates, that that work delayed completion of the project and increased its cost, for which respondent should be reimbursed, and that the decision of the Corps of Engineers in rejecting the claim was 'caparicious' or 'arbitrary.'
27
The Wunderlich Act, 41 U.S.C. § 321, makes 'final and conclusive' any decision by a federal agency under customary disputes clauses in government contracts with several exceptions 'unless the same is fraudulent or capricious or arbitrary or so grossly erroneous as necessarily to imply bad faith, or is not supported by substantial evidence.'
28
I think the decision was 'capricious or arbitrary' because evidence was considered by the Appeals Board in making its decision which the claimant did not see and which he had no opportunity to refute. I therefore think that a de novo hearing was permissible before the Court of Claims.
29
The Board found that respondent at the start should have used temporary protection against fall-ins and that, had it done so, permanent tunnel protection would not have been required. In February 1948, before the hearing, a letter from the Acting District Engineer to the Chief of Engineers reported a conversation the Corps' resident engineer for this project had had with an expert from New York's Bureau of Mines. The only inference that could be drawn from that report was that the expert believed that the tunnel was in safe condition shortly after it was bored and that its later unsafe condition was caused by the fact that respondent 'had not had the foresight to gunite the exposed tunnel roof with cement as the excavation progressed to seal it against air slacking (sic) * * *.' Somehow, in a manner not disclosed by the record, this letter came into the hands of the Appeal Board and was considered by it before a decision was rendered on the appeal.*
30
After the decision respondent learned of this expert's alleged statements and called him as a witness at the hearing before the Court of Claims, where he testified on the basis of his inspection that permanent, not temporary, protection against fall-ins was necessary from the beginning. As respects the guniting of the tunnel, one of the Government's own witnesses testified at the hearing before the Court of Claims that it would have served no useful purpose.
31
This issue—whether only temporary protection was needed—was one of the main issues in the case. When the agency making the decision relies on evidence that the claimant has no chance to refute, the hearing becomes infected with a procedure that lacks that fundamental fairness the citizen expects from his Government. Cf. Willner v. Committee on Character & Fitness, 373 U.S. 96, 83 S.Ct. 1175; Gonzales v. United States, 348 U.S. 407, 75 S.Ct. 409, 99 L.Ed. 467; Morgan v. United States, 304 U.S. 1, 58 S.Ct. 773, 82 L.Ed. 1129.
32
This irregularity points up what Judge Madden, writing for the Court of Claims, said in Volentine & Littleton, v. United States, 145 F.Supp. 952, 954, 136 Ct.Cl. 638, 641—642:
33
'* * * the so-called 'administrative record' is in many cases a mythical entity. There is no statutory provision for these administrative decisions or for any procedure in making them. The head of the department may make the decision on appeal personally or may entrust anyone else to make it for him. Whoever makes it has no power to put witnesses under oath or to compel the attendance of witnesses or the production of documents. There may or may not be a transcript of the oral testimony. The deciding officer may, and even in the departments maintaining the most formal procedures, does, search out and consult other documents which, it occurs to him, would be enlightening, and without regard to the presence or absence of the claimant.'
34
We are dealing, in other words, with subnormal administrative procedures. While the regulations governing hearings before the Corps of Engineers are published and provide many protective features (33 CFR § 210.4), they lack some of the safeguards normally accorded claimants in administrative proceedings. Thus they are specifically exempt from § 5 and from § 7 of the Administrative Procedure Act. 5 U.S.C. §§ 1004, 1006. The exemption from § 7 is highlighted in this case. That section provides in part:
35
'Every party shall have the right to present his case or defense by oral or documentary evidence, to submit rebuttal evidence, and to conduct such cross-examination as may be required for a full and true disclosure of the facts.' (Emphasis supplied.)
36
That provision, if applicable, would have made reliance by the Board on the ex parte hearsay statement of this outside expert reversible error. Lax procedural standards may at times do no harm. But where, as here, opinion evidence on the vital issue in the case was obtained ex parte and where that evidence is shown to have been false, the conclusion that the decision was 'capricious' or 'arbitrary' seems to me unavoidable.
37
A remand to the agency to determine whether the agency's decision is 'capricious' or 'arbitrary' seems obviously inappropriate, since it is the court, not the agency, that should determine that question. Since these administrative proceedings are exempt from the protective provisions of § 7 of the Administrative Procedure Act, there is no procedure whereby a contractor can determine whether the agency's decision rested on the testimony of 'faceless' or secret witnesses, as in this case. Like the case where a contractor seeks reformation of his contract (cf. Blake Constr. Co. v. United States, 111 U.S.App.D.C. 271, 296 F.2d 393), the only place he can get the hearing Congress intended him to have on whether the decision was 'capricious' or 'arbitrary' is in the courts.
1
41 U.S.C. § 321 provides: 'No provision of any contract entered into by the United States, relating to the finality or conclusiveness of any decision of the head of any department or agency or his duly authorized representative or board in a dispute involving a question arising under such contract, shall be pleaded in any suit now filed or to be filed as limiting judicial review of any such decision to cases where fraud by such official or his said representative or board is alleged: Provided, however, That any such decision shall be final and conclusive unless the same is fraudulent or capricious or arbitrary or so grossly erroneous as necessarily to imply bad faith, or is not supported by substantial evidence.'
41 U.S.C. § 322 provides: 'No Government contract shall contain a provision making final on a question of law the decision of any administrative official, representative, or board.'
2
The standard 'disputes' clause, as included in the contract involved in this case, provides: 'Except as otherwise specifically provided in this contract, all disputes concerning questions of fact arising under this contract shall be decided by the contracting officer subject to written appeal by the contractor within 30 days to the head of the department concerned or his duly authorized representative, whose decision shall be final and conclusive upon the parties thereto. In the meantime the contractor shall diligently proceed with the work as directed.'
3
With the decision below, compare, e.g., Allied Paint & Color Works, Inc. v. United States, 309 F.2d 133 (C.A.2d Cir.); Wells & Wells, Inc. v. United States, 269 F.2d 412 (C.A.8th Cir.). See also Mann Chemical Laboratories, Inc. v. United States, 174 F.Supp. 563 (D.C.D.Mass.). In suits involving less than $10,000, the District Courts have concurrent jurisdiction with the Court of Claims over claims arising under government contracts, 28 U.S.C. § 1346(a)(2), and in suits by the Government under such contracts have exclusive jurisdiction, see 28 U.S.C. § 1345.
4
See, e.g., Southern Shipyard Corp. v. United States, 76 Ct.Cl. 468; Needles for Use and Benefit of Needles v. United States, 101 Ct.Cl. 535.
5
Hearings before a Subcommittee of the Senate Judiciary Committee on S. 2487, 82d Cong., 2d Sess.
6
Hearings before the House Judiciary Committee on H.R. 1839 et al., 83d Cong., 1st Sess.
7
See, e.g., § 10 of the Administrative Procedure Act, 60 Stat. 243, 5 U.S.C. § 1009; § 10 of the Fair Labor Standards Act, 52 Stat. 1065, as amended, 29 U.S.C. § 210; § 10 of the National Labor Relations Act, 49 Stat. 453, as amended, 29 U.S.C. § 160.
8
See, e.g., Senate Hearings, supra, note 5, at 32—35, 57 58.
9
The Government citing Needles for Use and Benefit of Needles v. United States, 101 Ct.Cl. 535, 606—607, suggests that although the Court of Claims did receive 'live' evidence on such matters, it may not have 'consciously considered evidence not presented and not available to the administrative officers making the final administrative decision.'
10
House Hearings, supra, note 6, at 79—80.
*
The letter also contained a statement to the effect that only $9,000 was involved in the appeal. This figure was used in the Board's opinion, but it was nowhere mentioned in the hearing or record before the Board. In fact the figure was grossly inaccurate.
| 89
|
373 U.S. 647
83 S.Ct. 1441
10 L.Ed.2d 605
Donald WHEELDIN and Admiral Dawson, Petitioners,v.William WHEELER.
No. 493.
Argued April 23, 1963.
Decided June 3, 1963.
Mr. A. L. Wirin, Los Angeles, Cal., for petitioners.
Alan S. Rosenthal, Washington, D.C., for respondent.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
Petitioner Dawson1 was served with a subpoena to appear before the House Un-American Activities Committee. He alleges that the subpoena was signed in blank by the Committee Chairman and that respondent Wheeler, an investigator for the Committee, filled in Dawson's name without authorization of the Committee. We read the complaint, as does the Solicitor General, most favorably to Dawson and conclude that the complaint alleges that no member of the Committee even attempted to delegate the Committee's subpoena power to Wheeler. The complaint also alleges that Wheeler intended to subject petitioner, when he appeared as a witness before the Committee, to public shame, disgrace, ridicule, stigma, scorn and obloquy, and falsely place upon him the stain of disloyalty without any opportunity of fair defense, to petitioner's irreparable injury. The complaint alleges not only the lack of authority of respondent Wheeler to fill in the blank subpoena but also the unconstitutionality of the House Resolution and the Act of Congress, 60 Stat. 828, authorizing the Committee to act and to subpoena witnesses. The complaint alleges that the mere service of the subpoena on Dawson cost him his job and that Wheeler caused service to be made while petitioner was at work knowing that loss of employment would result. It prays that the subpoena be declared void and of no force or effect, and asks for damages and for an injunction.
2
The District Court denied declaratory and injunctive relief, holding that since Dawson's appearance did not seem imminent the case was not ripe for equitable intervention and that the mere apprehension that a federal right might be infringed at some future time did not warrant declaratory or injunctive relief at the present time. The District Court held that no federal cause of action was stated as respects damages and dismissed the complaint for lack of jurisdiction over the subject matter. The Court of Appeals held that declaratory relief, being within the District Court's discretion, was properly denied and that the claim for injunctive relief had become moot. It held, however, that 'in the sense of Bell v. Hood, 327 U.S. 678, 66 S.Ct. 773, 90 L.Ed. 939,' there was 'jurisdiction to entertain the claim for money damages,' and to that extent reversed. 9 Cir., 280 F.2d 293. On remand the District Court dismissed the action without opinion. The Court of Appeals affirmed. 9 Cir., 302 F.2d 36. The case is here on a petition for a writ of certiorari which we granted. 371 U.S. 812, 83 S.Ct. 58, 9 L.Ed.2d 54. The basic question presented is whether a federal claim for damages is stated.
3
We agree with the Court of Appeals in its first opinion (280 F.2d 293) that on the face of the complaint the federal court had jurisdiction. As we stated in Bell v. Hood, 327 U.S. 678, 685, 66 S.Ct. 773, 777, 90 L.Ed. 939, 'the right of the petitioners to recover under their complaint will be sustained if the Constitution and laws of the United States are given one construction and will be defeated if they are given another. For this reason the district court has jurisdiction.' And see Bock v. Perkins, 139 U.S. 628, 630, 11 S.Ct. 677, 678, 35 L.Ed. 314.
4
But on the undisputed facts, as they appear on argument of the case, no federal cause of action can be made out. Dawson's main reliance is on the Fourth Amendment, which protects a person against unreasonable searches and seizures. Its violation, he contends, occurred when an unauthorized subpoena was served on him. But there was neither a search nor a seizure of him. He was neither arrested nor detained pursuant to any subpoena; nor, so far as the complaint discloses, did he respond to the subpoena and either testify or refuse to testify; nor was the subpoena used to cite him for contempt. Cf. Williams v. United States, 341 U.S. 97, 71 S.Ct. 576, 95 L.Ed. 774. In short, the facts alleged do not establish a violation of the Fourth Amendment. And the provisions of the Civil Rights Act are clearly inapplicable to this kind of case. See R.S. §§ 1979, 1980, 42 U.S.C. §§ 1983, 1985;2 Tenney v. Brandhove, 341 U.S. 367, 71 S.Ct. 783, 95 L.Ed. 1019; Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492.
5
Apart from any rights which may arise under the Fourth Amendment, Congress has not created a cause of action for abuse of the subpoena power by a federal officer, at least where the subpoena was never given coercive effect. No claim is made that the Federal Tort Claims Act reaches that far.3 Cf. Hatahley v. United States, 351 U.S. 173, 76 S.Ct. 745, 100 L.Ed. 1065. There is much discussion in the briefs of Barr v. Matteo, 360 U.S. 564, 79 S.Ct. 1335, 3 L.Ed.2d 1434. But that was a libel action brought against a federal official in the District of Columbia. And the immunity doctrine of that case and Howard v. Lyons, 360 U.S. 593, 79 S.Ct. 1331, 3 L.Ed.2d 1454, upon which the Court of Appeals rested, is not relevant here, for, as the Solicitor General has conceded, under the allegations of the complaint respondent Wheeler was not acting sufficiently within the scope of his authority to bring the doctrine into play.
6
It is argued that the statute governing the issuance of subpoenas4 not having been complied with, a cause of action for damages 'arises' under it within the meaning of 28 U.S.C. § 1331. As respects the creation by the federal courts of common-law rights, it is perhaps needless to state that we are not in the free-wheeling days antedating Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188. The instances where we have created federal common law are few and restricted. In Clearfield Trust Co. v. United States, 318 U.S. 363, 63 S.Ct. 573, 87 L.Ed. 838, we created federal common law to govern transactions in the commercial paper of the United States; and we did so in view of the desirability of a uniform rule in that area. Id., 318 U.S. p. 367, 63 S.Ct. p. 575. But even that rule was qualified in Bank of America Nat. Trust & Sav. Ass'n v. Parnell, 352 U.S. 29, 77 S.Ct. 119, 1 L.Ed.2d 93. In Tunstall v. Brotherhood, etc., 323 U.S. 210, 65 S.Ct. 235, 89 L.Ed. 187, the federal right was derived from the federal duty of the union to act as bargaining representative for all members of the union.5 But it is difficult for us to see how the present statute, which only grants power to issue subpoenas, implies a cause of action for abuse of that power. Congress has not done here what was done in Textile Workers Union of America v. Lincoln Mills, 353 U.S. 448, 77 S.Ct. 912, 923, 1 L.Ed.2d 972, and left to federal courts the creation of a federal common law for abuse of process.
7
When it comes to suits for damages for abuse of power, federal officials are usually governed by local law. See, e.g., Slocum v. Mayberry, 2 Wheat. 1, 10, 12, 4 L.Ed. 169. Federal law, however, supplies the defense, if the conduct complained of was done pursuant to a federally imposed duty (see, e.g., Mayor and Aldermen of City of Nashville v. Cooper, 6 Wall. 247, 18 L.Ed. 851; cf. Tennessee v. Davis, 100 U.S. 257, 25 L.Ed. 648), or immunity from suit. See Barr v. Matteo, supra; Howard v. Lyons, supra. Congress could, of course, provide otherwise, but it has not done so. Over the years Congress has considered the problem of state civil and criminal actions against federal officials many times. See Hart and Wechsler, The Federal Courts and the Federal System, 1147—1150. But no general statute making federal officers liable for acts committed 'under color,' but in violation, of their federal authority has been passed. Congress has provided for removal to a federal court of any state action, civil or criminal, against '(a)ny officer of the United States * * *, or person acting under him, for any act under color of such office * * *.' 28 U.S.C. § 1442(a)(1). That state law governs the cause of action alleged is shown by the fact that removal is possible in a nondiversity case such as this one only because the interpretation of a federal defense makes the case one 'arising under' the Constitution or laws of the United States. See Tennessee v. Davis, supra; Gay v. Ruff, 292 U.S. 25, 34, 54 S.Ct. 608, 612, 78 L.Ed. 1099. We conclude, therefore, that it is not for us to fill any hiatus Congress has left in this area.
8
No question of pendent jurisdiction as in Hurn v. Oursler, 289 U.S. 238, 53 S.Ct. 586, 77 L.Ed. 1148, is presented, for petitioner has not attempted to state a claim under state law.
9
We hold on the conceded facts that no federal cause of action was stated and that the judgment must be and is affirmed.
10
Affirmed.
11
Mr. Justice BRENNAN, with whom The CHIEF JUSTICE and Mr. Justice BLACK join, dissenting.
12
The Court of Appeals characterized petitioners' suit as follows: 'The gravamen of their complaint is that the subpoenas were invalidly, maliciously and mischievously issued and served for the sole purpose of exposing them to public scorn with consequent loss of employment and of esteem. They assert that they have a federal right to protection against such abuse of federal process; that since the subpoenas were not properly issued appellee in securing their issuance and service has subjected himself to personal liability.' 9 Cir., 302 F.2d 36—37. The Court of Appeals did not, however, decide whether such a 'federal right' exists and, if so, whether the complaint sufficiently alleged a denial of it. It sustained the District Court's dismissal on the sole ground that the allegedly unlawful acts had been committed by respondent in the line of his duty as a federal officer, and that therefore he was immune from suit by reason of the principles announced in Barr v. Matteo, 360 U.S. 564, 79 S.Ct. 1335, 3 L.Ed.2d 1434. In this Court, the Solicitor General of the United States, appearing as counsel for the respondent, candidly admits that the Court of Appeals misapplied Barr v. Matteo. In that case we upheld the governmental-officer immunity in respect of 'action * * * taken * * * within the outer perimeter of petitioner's line of duty.' 360 U.S., at 575, 79 S.Ct. at 1341. It has never been suggested that the immunity reaches beyond that perimeter, so as to shield a federal officer acting wholly on his own. A federal officer remains liable for acts committed 'manifestly or palpably beyond his authority.' Spalding v. Vilas, 161 U.S. 483, 498, 16 S.Ct. 631, 637, 40 L.Ed. 780; see Colpoys v. Gates, 73 App.D.C. 193, 118 F.2d 16; Kozlowski v. Ferrara, D.C., 117 F.Supp. 650; Note, Remedies Against the United States and Its Officials, 70 Harv.L.Rev. 827, 835 (1957). Liberally construed, see Virgin Islands Corp. v. W. A. Taylor & Co., 2 Cir., 202 F.2d 61; 2 Moore, Federal practice (2d ed. 1948), 12.08, at 2245, petitioner Dawson's complaint alleges no less.1 He alleges that respondent 'secured from the staff of said Committee, blank subpoenas in large numbers' (emphasis supplied), and this can be read, the Solicitor General concedes, 'to allege that no member of the Committee even attempted to delegate the Committee's subpoena power to Wheeler.' Since members of the Committee's staff clearly have no power to delegate the issuance of subpoenas, respondent, according to the allegations of the complaint, was acting 'manifestly or palpably beyond his authority.'2
13
I think the proper disposition of this case would be to vacate the Court of Appeals' judgment, based as it was wholly upon an erroneous ground, and remand the case to the Court of Appeals for consideration of the questions which that court found unnecessary to decide. I recommend this course because the instant case seems to be to raise novel and important questions which have not been adequately briefed or argued by the parties and which this Court consequently, in its opinion today, treats in a most cursory fashion.
14
The Court states that 'Dawson's main reliance is on the Fourth Amendment.' I cannot agree with this. As the Court of Appeals correctly apprehended, the gravamen of the complaint is the notion of a tort of malicious abuse of federal process by a federal officer. This to me raises a number of questions. Does the complaint state a claim actionable under common-law principles? If so, and if the claim is a creature of state law, may it nevertheless be entertained in the federal courts? Under what theory, if any, can the claim be deemed federal and within the original jurisdiction of the Federal District Courts? As will become apparent, these questions, which I shall discuss in order, do not require reference to the Fourth Amendment.3
15
The Court of Appeals described the instant action as one claiming malicious abuse of process. But, as usually defined, that tort 'is committed when the actor employs legal process in a manner technically correct, but for a wrongful and malicious purpose to attain an unjustifiable end * * *.' 1 Harper and James, Torts (1956), § 4.9; see 3 Restatement of Torts § 682; Prosser, Torts (2d ed. 1955), § 100. But succinctly, the tort is the 'perversion' of legal process. Mayer v. Walter, 64 Pa. 283, 286. In the instant case, the process allegedly abused was not judicial, but legislative. I do not, however, consider the distinction material. But cf. Comment, 63 Col.L.Rev. 326, 327, n. 13 (1963). Abuse of administrative process seems to be a recognized aspect of the tort, see 1 Harper and James, supra, § 4.10; 3 Restatement of Torts § 680; National Surety Co. v. Page, 4 Cir., 58 F.2d 145; but cf. Petherbridge v. Bell, 146 Va. 822, 132 S.E. 683, and so does abuse of the judicial subpoena power, Dishaw v. Wadleigh, 15 App.Div. 205, 44 N.Y.S. 207. The congressional subpoena is no less mandatory than the judicial, see Watkins v. United States, 354 U.S. 178, 187—188, 77 S.Ct. 1173, 1179, 1 L.Ed.2d 1273, no less a placing of governmental compulsion upon the recipient, cf. Sinclair v. United States, 279 U.S. 263, 292, 49 S.Ct. 268, 271, 73 L.Ed. 692. It may, of course, be the first link in a chain leading to eventual criminal prosecution. See, e.g., R.S. § 102, as amended, 2 U.S.C. § 192.
16
I should point out that the conventional notion of abuse of process assumes that the wrongdoer is a private person who procures the issuance of valid, authorized legal process, albeit with a wrongful intention and for an unjustifiable end. Comment, 63 Col.L.Rev. 326, 327, n. 13. The tort, thus, does not depend on the validity of the process, which may be 'technically correct,' yet still abusive. In the instant case, however, liability is sought to be imposed upon the officer who issues the process, and his authority vel non is of the essence.4 Pertinent here is the settled principle of the accountability, in damages, of the individual governmental officer for the consequences of his wrongdoing. See, e.g., Entick v. Carrington, 19 Howell's State Trials 1029 (C.P. 1765); Marbury v. Madison, 1 Cranch 137, 163 168, 2 L.Ed. 60; cf. Wolf v. Colorado, 338 U.S. 25, 30—31, n. 1, 69 S.Ct. 1359, 1362—1363, 93 L.Ed. 1782. With respect to federal officers, see, e.g., Little v. Barreme, 2 Cranch 170, 2 L.Ed. 243; Elliott v. Swartwout, 10 Pet. 137, 9 L.Ed. 373; Mitchell v. Harmony, 13 How. 115, 14 L.Ed. 75; Buck v. Colbath, 3 Wall. 334, 18 L.Ed. 257; Bates v. Clark, 95 U.S. 204, 24 L.Ed. 471; Kilbourn v. Thompson, 103 U.S. 168, 26 L.Ed. 377; Belknap v. Schild, 161 U.S. 10, 18, 16 S.Ct. 443, 445, 40 L.Ed. 599; Philadelphia Co. v. Stimson, 223 U.S. 605, 619, 32 S.Ct. 340, 343, 56 L.Ed. 570. This principle, in combination with the conventional notion of malicious abuse of process, seems to me ample warrant for concluding that the instant complaint makes out a common-law cause of action. Compare cases in which state judicial officers have been held liable in damages for abuse of process: Williams v. Kozak, 4 Cir., 280 F. 373; Dean v. Kochendorfer, 237 N.Y. 384, 143 N.E. 229; Hoppe v. Klapperich, 224 Minn. 224, 28 N.W.2d 780, 173 A.L.R. 819.
17
If so, and if we assume that this claim is actionable under California law5 (postponing, for the moment, the question whether it may also be actionable under federal law), then it seems to me there are two possible theories for sustaining federal court jurisdiction over it. The first relies upon the principle of pendent jurisdiction drawn from Hurn v. Oursler, 289 U.S. 238, 53 S.Ct. 586, 77 L.Ed. 1148. Since the complaint asserts a nonfrivolous claim under the Fourth Amendment, federal court jurisdiction attaches, Bell v. Hood, 327 U.S. 678, 66 S.Ct. 773, 90 L.Ed. 939, thereby permitting decision of the common-law claim which is based upon the same facts, see id., 327 U.S. at 686, 66 S.Ct. at 778 (dissenting opinion).6 Whether the instant complaint can be read as adequately claiming pendent jurisdiction would seem a matter best determined in the first instance by the courts below. I cannot accept the Court's flat assertion that 'petitioner has not attempted to state a claim under state law,' in view of the liberality of pleading practice under the Federal Civil Rules. 'A motion to dismiss a complaint, without the aid of anything except the complaint itself, is usually a most undesirable way for a defendant to seek a victory. For, on such a motion, the court must construe the complaint's language in a manner most favorable to the plaintiff; and, if that language is at all ambiguous, seldom will it, when thus generously construed, fail to show a cause of action.' Virgin Islands Corp. v. W. A. Taylor & Co., supra, 202 F.2d at 65. The dismissal of the instant complaint was on motion by defendant
18
The second possible theory builds from Smith v. Kansas City Title & Trust Co., 255 U.S. 180, 41 S.Ct. 243, 65 L.Ed. 577. A shareholder sued to enjoin the Trust Company, a Missouri corporation, from investing in certain federal bonds, on the ground that the Act of Congress authorizing their issuance was unconstitutional. It was claimed that under Missouri law an investment in securities the issuance of which had not been authorized by a vaid law was ultra vires and enjoinable. The cause of action, thus, was state-created. Nevertheless this Court held that the action was one arising under federal law within the meaning of the predecessor section to 28 U.S.C. § 1331(a). See also Fielding v. Allen, 2 Cir., 181 F.2d 163. It has been suggested that later decisions, e.g., Puerto Rico v. Russell & Co., 288 U.S. 476, 53 S.Ct. 447, 77 L.Ed. 903; Gully v. First Nat. Bank, 299 U.S. 109, 57 S.Ct. 96, 81 L.Ed. 70, repudiated Smith. London, 'Federal Question' Jurisdiction—A Snare and a Delusion, 57 Mich.L.Rev. 835, 853 (1959). But those decisions are clearly distinguishable as attempts to found federal jurisdiction upon 'remote federal premises, or mere federal permission * * *, or other merely possible federal defenses.' Hart and Wechsler, The Federal Courts and the Federal System (1953), 769. Smith remains firm authority for the principle that 'where federal law has inserted itself into the texture of state law, a claim founded on the national legislation could be brought into a federal forum' even if the right of action was state-created. Mishkin, The Federal 'Question' in the District Courts, 53 Col.L.Rev. 157, 166 (1953). Stated differently, 'in the Smith case the claim under federal law was an essential ingredient of the plaintiff's case, without which he could assert no right to relief.' Hart and Wechsler, supra, at 766. In short, there is federal-question jurisdiction if a proposition of federal law is inherent in the plaintiff's claim. Cf. Wechsler, Federal Jurisdiction and the Revision of the Judicial Code, 13 Law and Contemp.Prob. 216, 225 (1948).
19
How does the instant complaint fare under this standard? The matter is not free from doubt, but it is arguable, at least, that inherent in a claim to abuse of federal process by a federal officer are certain propositions drawn from the network of federal statutory and constitutional provisions governing congressional investigations. In other words, implicit in the notion of abuse of process are the principles controlling the proper use of process. Concretely, the instant complaint asserts that respondent's use of congressional process was unauthorized and was for an 'unjustifiable end,' p. 655, supra; surely the contours of this authority and the classification of justifiable and unjustifiable ends of congressional process are matters of federal law. Thus, just as Smith is a case 'where state law incorporates federal standards by reference,' Wechsler, supra, at 225, n. 46, so here a basic element of the common-law tort is the body of federal law authorizing and defining the issuance of federal legislative process. I do not wish, however, to be understood as suggesting that the analogy is perfect.7
20
I come now to the question whether petitioner Dawson's cause of action may be deemed created by federal law apart from the Fourth Amendment. It is not claimed that any federal statute in terms confers a remedy in damages for malicious abuse of federal process by a federal officer.8 But it is argued that such a remedy (1) may be implied from the Act of Congress respecting the issuance of subpoenas by the House Un-American Activities Committee and its subcommittees, and (2) is given by the federal common law.
21
The Legislative Reorganization Act of 1946, c. 753, § 121(b), House Rule XI(1) (q)(2), 60 Stat. 828, provides in part: 'Subpenas may be issued under the signature of the chairman of the committee (on Un-American Activities) or any subcommittee, or by any member designated by any such chairman * * *.' If this provision be interpreted to prohibit respondent from issuing the Committee's subpoenas on his own,9 may a right of action in damages be implied in favor of one injured as a direct consequence of respondent's unlawful use of such a subpoena? I see no reason why it may not. 'Implied rights of action are not contingent upon statutory language which affirmatively indicates that they are intended. On the contrary, they are implied unless the legislation evidences a contrary intention.' Brown v. Bullock, D.C., 194 F.Supp. 207, 224, aff'd on other grounds, 2 Cir., 294 F.2d 415. Increasingly, the tendency in the federal courts has been to infer private rights of action from federal statutes unless to do so would defeat manifest congressional purpose. See, e.g., Texas & Pac. R. Co. v. Rigsby, 241 U.S. 33, 36 S.Ct. 482, 60 L.Ed. 874; Tunstall v. Brotherhood of Locomotive Firemen & Enginemen, 323 U.S. 210, 65 S.Ct. 235, 89 L.Ed. 187; Neiswonger v. Goodyear Tire & Rubber Co., D.C., 35 F.2d 761; Reitmeister v. Reitmeister, 2 Cir., 162 F.2d 691; Fitzgerald v. Pan American World Airways, 2 Cir., 229 F.2d 499; Roosevelt Field, Inc. v. Town of North Hempstead, D.C., 84 F.Supp. 456; Wills v. Trans World Airlines, Inc., D.C., 200 F.Supp. 360; 2 Loss, Securities Regulation (2d ed. 1961), 932—956; Note, 48 Col.L.Rev. 1090 (1948). We must presume that Congress, in specifying the conditions for the lawful delegation of the Committee on Un-American Activities' subpoena power, was mindful of the grave injustices which might be done to individuals as a result of the flouting of those conditions. In this sense, Rule XI(1)(q)(2) may be said to have created a protected class of private persons of which petitioner Dawson, if the allegations of his complaint be true, is a member. Moreover, a private damages action affords the only practicable means of redressing the kind of wrong Dawson alleges. Since he was never called to testify he could not use the circumstances surrounding the issuance of the subpoena defensively,10 and, for the same reason, his prayer for injunctive relief was struck below as moot, 280 F.2d 293 (per curiam). And cf. Pauling v. Eastland, 109 U.S.App.D.C. 342, 288 F.2d 126; Mins v. McCarthy, 93 U.S.App.D.C. 220, 209 F.2d 307.
22
Nor is it the case that a congressional rule (in the instant case contained in an Act of Congress) stands on a different footing, as respects judicial enforcement, from a rule respecting administrative, executive, or other conduct. It has long been settled that rules of Congress and its committees are judicially cognizable. Christoffel v. United States, 338 U.S. 84, 69 S.Ct. 1447, 93 L.Ed. 1826; United States v. Smith, 286 U.S. 6, 52 S.Ct. 475, 76 L.Ed. 954; United States v. Ballin, 144 U.S. 1, 12 S.Ct. 507, 36 L.Ed. 321. I therefore see no objection in principle to grounding a private action in such a rule.
23
A final approach to the problem of founding federal jurisdiction11 is by way of the federal common law. Mr. Justice Brandeis' dictum: 'There is no federal general common law,' Erie R. Co. v. Tompkins, 304 U.S. 64, 78, 58 S.Ct. 817, 822, 82 L.Ed. 1188, cannot, of course, be taken at its full breadth. '(A) lthough federal judicial power to deal with common-law problems was cut down in the realm of liability or its absence governable by state law, that power remained unimpaired for dealing independently, wherever necessary or appropriate, with essentially federal matters, even though Congress has not acted affirmatively about the specific question.' United States v. Standard Oil Co., 332 U.S. 301, 307, 67 S.Ct. 1604, 1608, 91 L.Ed. 2067. 'Were we bereft of the common law, our federal system would be impotent.' D'Oench, Duhme & Co. v. Federal Deposit Ins. Corp., 315 U.S. 447, 470, 62 S.Ct. 676, 685, 86 L.Ed. 956 (concurring opinion). And so in a wide variety of cases the federal courts have assumed to fashion federal common-law rights.12 Ordinarily, to be sure, such fashioning is done under the aegis of a more specific jurisdictional grant than 28 U.S.C. § 1331(a). But I agree with the test set forth in United States v. Standard Oil Co., supra, and would recognize the existence of federal common-law rights of action 'wherever necessary or appropriate' for dealing with 'essentially federal matters.' Plainly, this test supports recognition of a federal cause of action on the facts of the instant complaint. '(A)ctions against federal officials * * * are necessarily of federal concern.' Wechsler, supra, at 220. This is not to say that federal law is necessarily implicated whenever the defendant is a federal officer. See Johnston v. Earle, 9 Cir., 245 F.2d 793. But where, as here, it is alleged that a federal officer acting under color of federal law has so abused his federal powers as to cause unjustifiable injury to a private person, I see no warrant for concluding that state law must be looked to as the sole basis for liability. Under such circumstances, no state interest is infringed by a generous construction of federal jurisdiction, and every consideration of practicality and justice argues for such a construction.13 To be sure, once the federal common-law cause of action is recognized, the much-mooted problem remains whether such a cause arises under federal law within the meaning of 28 U.S.C. § 1331(a). This Court has never decided the question.14 For the position that it does, see my separate opinion in Romero v. International Terminal Operating Co., 358 U.S. 354, 389 412, 79 S.Ct. 468, 489—501, 3 L.Ed.2d 368, and Kurland, The Romero Case and Some Problems of Federal Jurisdiction, 73 Harv.L.Rev. 817, 831—833 (1960).
24
Let me make clear that I am not suggesting that this Court enjoys the same freedom to create common-law rights of action as do truly common-law courts. But there is a matrix of federal statutory and constitutional principles governing the rights, duties, and immunities of federal officers acting under color of federal authority. The existence of this matrix makes the matter of private actions against such officers respecting conduct alleged to be in excess of their authority of essentially federal concern, which justifies, in my view, the exercise of the residual common-law power which we unquestionably possess. 'At the very least, effective Constitutionalism requires recognition of power in the federal courts to declare, as a matter of common law or 'judicial legislation,' rules which may be necessary to fill in interstitially or otherwise effectuate the statutory patterns enacted in the large by Congress.' Mishkin, The Variousness of 'Federal Law': Competence and Discretion in the Choice of National and State Rules for Decision, 105 U. of Pa.L.Rev. 797, 800 (1957).
25
Thus the theories of an implied right of action based on Rule XI(1)(q)(2) and a federal common-law right ultimately coalesce. 'It seems monstrous to imply that when Congress as a matter of federal law lays the foundation for a right or condemns any conduct as a wrong, nothing can be done about it by courts without clear warrant in statutory language and legislative history.' Powell, Use of Common-Law Techniques and Remedies in Statutory Enforcement—A Study in Judicial Behavior, 57 Harv.L.Rev. 900, 902 (1944). Rule XI(1)(q)(2) at least provides the foundation; the superstructure may be derived from the various sources I have canvassed. I should not like to believe that this Court is helpless to inaugurate in the federal courts the salutary '(r)estoration of the doctrine that a government officer is civilly responsible in damages for an exercise of official discretion which is motivated by personal vindictiveness or desire for personal gain.' Hart and Wechsler, supra, at 1230. I do not believe that the matter can properly be remitted entirely to the state courts. See Foote, supra, note 13, for a trenchant criticism of existing state remedies for the wrongful acts of public officers. Cf. Mapp v. Ohio, 367 U.S. 643, 651—652, 81 S.Ct. 1684, 1689—1690, 6 L.Ed.2d 1081.
26
I have dealt with the foregoing problems in a deliberately tentative manner. My discussion is intended to be only suggestive, not exhaustive; I am not prepared to offer definitive solutions. But it seems to me that these novel and difficult problems permeate the case and justify our adoption here of the disposition we made in Bell v. Hood of remanding the case for a consideration of them by the courts below in the first instance.
1
Petitioner Donald Wheeldin was in the case when we granted certiorari. But since that time Wheeldin has moved for leave to withdraw his petition, which motion we hereby grant.
2
By § 1983 Congress made liable in civil suits 'every person' who 'under color' of any state or territorial law deprives anyone of a right 'secured by the Constitution and laws' of the United States. But respondent Wheeler was not acting 'under color' (see Screws v. United States, 325 U.S. 91, 108, 111, 65 S.Ct. 1031, 1038, 1040, 89 L.Ed. 1495; Monroe v. Pape, 365 U.S. 167, 171 187, 81 S.Ct. 473, 475—484, 5 L.Ed.2d 492) of state or territorial law. And even if § 1985 applies to federal officers (compare Screws v. United States, supra, with Collins v. Hardyman, 341 U.S. 651, 71 S.Ct. 937, 95 L.Ed. 1253) who conspire with others to commit acts falling within the narrow confines of that statute, no such conspiracy is here involved. See generally, 1 Emerson and Haber, Political and Civil Rights in the United States, 79—100; 1961 United States Commission on Civil Rights Report, Book 5, 71 77.
3
28 U.S.C. § 2680 provides: 'The provisions of (the Tort Claims Act) * * * shall not apply to—
'(h) Any claim arising out of assault, battery, false imprisonment, false arrest, malicious prosecution, abuse of process, libel, slander, misrepresentation, deceit, or interference with contract rights.'
4
Legislative Reorganization Act of 1946, P.L. 601, c. 753, House Rule XI(1) (q)(2), 60 Stat. 828: 'Subpenas may be issued under the signature of the chairman of the committee (on Un-American Activities) or any subcommittee, or by any member designated by any such chairman * * *.'
5
The other cases cited are singularly inapposite. Holmberg v. Armbrecht, 327 U.S. 392, 66 S.Ct. 582, 90 L.Ed. 743, was a suit to enforce a liability created by a federal statute, and the question was what remedies the federal courts should apply. Howard v. Lyons, 360 U.S. 593, 79 S.Ct. 1331, 3 L.Ed.2d 1454, held in a diversity suit for libel against a federal official that, although state law created the right, the defense of privilege is to be formulated by the federal courts. Id., 360 U.S. 597, 79 S.Ct. 1333.
1
Petitioner Wheeldin has withdrawn from the case in this Court.
2
It is not contended that respondent was acting under the orders of a superior officer which he reasonably believed to be lawful or authorized. Compare Gray, Private Wrongs of Public Servants, 47 Cal.L.Rev. 303, 317—318 (1959); Comment, 63 Col.L.Rev. 326, 334 (1963). And of course no issue is involved here of the scope of the immunity of Congressmen themselves from private civil suits. Cf. Tenney v. Brandhove, 341 U.S. 367, 378, 71 S.Ct. 783, 789, 95 L.Ed. 1019.
3
In so confining my discussion, I mean to intimate no view on the questions whether the complaint states a violation of the Fourth Amendment and whether, if so, a remedy in damages is available. On the latter question, compare Wiley v. Sinkler, 179 U.S. 58, 21 S.Ct. 17, 45 L.Ed. 84; Swafford v. Templeton, 185 U.S. 487, 22 S.Ct. 783, 46 L.Ed. 1005; and Bell v. Hood, 327 U.S. 678, 684, 66 S.Ct. 773, 776, 90 L.Ed. 939, with Bell v. Hood, D.C., 71 F.Supp. 813; and Johnston v. Earle, 9 Cir., 245 F.2d 793. These questions, too, should be determined in the first instance by the courts below. See Bell v. Hood, 327 U.S. 678, 66 S.Ct. 773, 90 L.Ed. 939.
4
The question of authority is, of course, distinct from that of immunity from civil suit. Even an unauthorized act may be within the scope of the immunity, so long as it is within the 'outer perimeter' of the officers' 'line of duty.' Barr v. Matteo, supra, 360 U.S. at 575, 79 S.Ct. at 1341. That, however, is a matter of defense. Whether respondent's issuance of the subpoena to petitioner Dawson was authorized by law would seem to be an element of the tort framed in the complaint.
5
The acts complained of as establishing the cause of action all took place, apparently, in California, and petitioner and respondent are both residents of California; thus, the tort law of California would seem to be the appropriate referent. Neither the parties nor the courts below have canvassed the possibly relevant California authorities and I have made no independent investigation of the question. But consider § 3281 of the California Civil Code: 'Every person who suffers detriment from the unlawful act or omission of another, may recover from the person in fault a compensation therefor in money, which is called damages.' Cf. Bell v. Hood, D.C., 71 F.Supp. 813, 817; Toscano v. Olesen, D.C., 189 F.Supp. 118; but cf. Foote, Tort Remedies for Police Violations of Individual Rights, 39 Minn.L.Rev. 493, 502 503 (1955).
6
The Solicitor General agrees that the Fourth Amendment claim in the complaint conferred federal court jurisdiction to dispose of it
on the merits, and the Court of Appeals so held in an earlier phase of the instant litigation. 280 F.2d 293 (per curiam). This result is clearly compelled by Bell v. Hood, 327 U.S. 678, 66 S.Ct. 773, 90 L.Ed. 939. On the remand in Bell v. Hood, the District Court held that a state law claim relying on the same facts as the Fourth Amendment claim could not be entertained under the doctrine of pendent jurisdiction because the Fourth Amendment claim did not state a cause of action. 71 F.Supp. 813, 820. This ground has been criticized, with the suggestion however that 'the dismissal (might) have been more convincingly supported by saying that the dog would be wagged by his tail if plenary trial of an ancillary claim was compelled by a primary claim which could be disposed of on the pleadings.' Hart and Wechsler, The Federal Courts and the Federal System (1953), 808; see Note, 62 Col.L.Rev. 1018, 1025—1026 (1962); Salganik v. Mayor and City Council of Baltimore, D.C., 192 F.Supp. 897. Whether this suggestion has merit or applicability in the instant case I am not prepared to say. I should also point out that if the federal question were deemed completely insubstantial on the merits, dismissal of the pendent claim might be appropriate on that ground. See Levering & Garrigues Co. v. Morrin, 289 U.S. 103, 105, 53 S.Ct. 549, 550, 77 L.Ed. 1062; Emmons v. Smitt, 6 Cir., 149 F.2d 869. I note finally that the District Court in Bell v. Hood on remand suggested that the doctrine of pendent jurisdiction pertains only to equitable claims. 71 F.Supp., at 820. This was error. See, e.g., Manosky v. Bethlehem-Hingham Shipyard, Inc., 1 Cir., 177 F.2d 529; Note, 62 Col.L.Rev. 1018, 1034—1041 (1962).
7
In Smith, the investment powers of the Trust Company were subject to federal law governing the issuance of federal securities. Thus, substantially the only question in the case was the validity vel non of the issuance under federal law. Here, besides the question of respondent's authority vel non to issue the subpoena, there are questions, e.g., malice, which might be thought to be rooted in the common law of abuse of process.
8
No claim here is made of a conspiracy to deny petitioner the equal protection of the laws. R.S. § 1980 Third, 42 U.S.C. § 1985(3). Nor is this an action for breach of a United States marshal's bond, 28 U.S.C. § 544; in an earlier phase of the instant litigation, the complaint was dismissed as against a United States marshal and a sheriff as frivolous. 280 F.2d 293 (per curiam). The Federal Tort Claims Act, 28 U.S.C. §§ 2671—2680, has nothing to do with the present case, since the Act imposes liability on the United States and does not pertain to the question of individual federal officers' personal tort liability. The Act excludes abuse of process and other intentional torts. See § 2680(h).
9
I do not reach the question, which was not decided below or discussed in the opinion of the Court today, whether the Committee may delegate the power to issue subpoenas to members of its staff; petitioner Dawson contends that no such delegation was here attempted, see p. 654, supra.
10
Arguably, the validity of the subpoena could not be challenged in a criminal prosecution based on refusal to testify before the Committee, but presumably it could be challenged in a prosecution for willful default of subpoena. See R.S. § 102, as amended, 2 U.S.C. § 192; McPhaul v. United States, 364 U.S. 372, 81 S.Ct. 138, 5 L.Ed.2d 136.
11
If Rule XI(1)(q)(2) were interpreted to create an implied right of action in favor of petitioner, his claim would be one arising under federal law within the meaning of 28 U.S.C. § 1331(a), since the rule was enacted as part of an Act of Congress. It seems to me to make no difference that the instant complaint cites not the Legislative Reorganization Act, but rather H.Res. 5, 85th Cong., 1st Sess., wherein the provisions of the Act were adopted in haec verba as rules of the 85th Congress. See 103 Cong.Rec. 47 (1957).
12
E.g., Southern Express Co. v. Byers, 240 U.S. 612, 36 S.Ct. 410, 60 L.Ed. 825; Sola Elec. Co. v. Jefferson Elec. Co., 317 U.S. 173, 63 S.Ct. 172, 87 L.Ed. 165; Clearfield Trust Co. v. United States, 318 U.S. 363, 367, 63 S.Ct. 573, 575, 87 L.Ed. 838; United States v. County of Allegheny, 322 U.S. 174, 183, 64 S.Ct. 908, 913, 88 L.Ed. 1209; Holmberg v. Armbrecht, 327 U.S. 392, 395, 66 S.Ct. 582, 584, 90 L.Ed. 743; United States v. Fullard-Leo, 331 U.S. 256, 269—270, 67 S.Ct. 1287, 1292—1293, 91 L.Ed. 1474; Rea v. United States, 350 U.S. 214, 76 S.Ct. 292, 100 L.Ed. 233; Textile Workers Union of America v. Lincoln Mills, 353 U.S. 448, 457, 77 S.Ct. 912, 918, 923, 1 L.Ed.2d 972; Howard v. Lyons, 360 U.S. 593, 597, 79 S.Ct. 1331, 1333, 3 L.Ed.2d 1454; International Ass'n of Machinists v. Central Airlines, 372 U.S. 682, 691, 693, n. 17, 83 S.Ct. 956, 962, 963, 10 L.Ed.2d 67; O'Brien v. Western Union Tel. Co., 1 Cir., 113 F.2d 539; Kaufman v. Western Union Tel. Co., 5 Cir., 224 F.2d 723, 728; Kardon v. National Gypsum Co., D.C., 73 F.Supp. 798; see Hart, The Relations Between State and Federal Law, 54 Col.L.Rev., 489, 530—535 (1954); Bell v. Hood, 327 U.S. 678, 684, 66 S.Ct. 773, 776, 90 L.Ed. 939.
13
Thus, it is unsettled whether the state courts have jurisdiction to entertain an action to enjoin a federal officer acting under color of federal law, Hart and Wechsler, supra, at 388—391, so that denial of federal court jurisdiction over claims such as petitioner's might leave an injured party totally remediless. To be sure, there is state court jurisdiction of damages actions against federal officers. Teal v. Felton, 12 How. 284, 13 L.Ed. 990; Buck v. Colbath, 3 Wall. 334, 18 L.Ed. 257. But damages may not in every case be an adequate remedy. And if the existence of state damages remedies were relied upon to confine federal court jurisdiction to equitable actions against federal officers, a person seeking both equitable and damages relief could only invoke federal court jurisdiction at the cost of splitting his claim. So also, the broad provisions for the removal to federal courts of actions commenced against federal officers, 28 U.S.C. § 1442, unfairly give access to the federal courts to defendants which is denied plaintiffs. See Wechsler, supra, at 220 221. And it has been suggested that recognition of a federal cause of action against governmental officers might allow a more effective measure of damages than is presently available under state tort law, Foote, Tort Remedies for Police Violations of Individual Rights, 39 Minn.L.Rev. 493, 512 (1955).
14
In Romero v. International Terminal Operating Co., 358 U.S. 354, 79 S.Ct. 468, 3 L.Ed.2d 368, a majority of the Court held that claims under the general maritime law, which is a body of federal decisional law, did not arise under federal law for the purposes of § 1331(a). But the Court based its decision on considerations peculiar to the maritime law and did not purport to resolve the broader question whether claims under federal common law are within § 1331(a). See 358 U.S., at 395, 79 S.Ct. at 492 (separate opinion).
| 23
|
373 U.S. 546
83 S.Ct. 1468
10 L.Ed.2d 542
STATE OF ARIZONA, Plaintiff,v.STATE OF CALIFORNIA et al.
No. 8, Original.
Reargued Nov. 13 and 14, 1962.
Decided June 3, 1963.
[Syllabus from pages 546-549 intentionally omitted]
Mark Wilmer, Phoenix, Ariz., for complainant.
Northcutt Ely, Washington, D.C., for defendant State of California.
R. P. Parry, Twin Falls, Idaho, for intervener State of Nevada.
Sol. Gen. Archibald Cox for intervener United States.
Mr. Justice Black delivered the opinion of the Court.
1
In 1952 the State of Arizona invoked the original jurisdiction of this Court1 by filing a complaint against the State of California and seven of its public agencies.2 Later, Nevada, New Mexico, Utah, and the United States were added as parties either voluntarily or on motion.3 The basic controversy in the case is over how much water each State has a legal right to use out of the waters of the Colorado River and its tributaries. After preliminary pleadings, we referred the case to George I. Haight, Esquire, and upon his death in 1955 to Simon H. Rifkind, Esquire, as Special Master to take evidence, find facts, state conclusions of law, and recommend a decree, all 'subject to consideration, revision, or approval by the Court.'4 The Master conducted a trial lasting from June 14, 1956, to August 28, 1958, during which 340 witnesses were heard orally or by deposition, thousands of exhibits were received, and 25,000 pages of transcript were filled. Following many motions, arguments, and briefs, the Master in a 433-page volume reported his findings, conclusions, and recommended decree, received by the Court on January 16, 1961.5 The case has been extensively briefed here and orally argued twice, the first time about 16 hours, the second, over six. As we see this case, the question of each State's share of the waters of the Colorado and its tributaries turns on the meaning and the scope of the Boulder Canyon Project Act passed by Congress in 1928.6 That meaning and scope can be better understood when the Act is set against its background—the gravity of the Southwest's water problems; the inability of local groups or individual States to deal with these enormous problems; the continued failure of the States to agree on how to conserve and divide the waters; and the ultimate action by Congress at the request of the States creating a great system of dams and public works nationally built, controlled, and operated for the purpose of conserving and distributing the water.
2
The Colorado River itself rises in the mountains of Colorado and flows generally in a southwesterly direction for about 1,300 miles through Colorado, Utah, and Arizona and along the Arizona-Nevada and Arizona-California boundaries, after which it passes into Mexico and empties into the Mexican waters of the Gulf of California. On its way to the sea it receives tributary waters from Wyoming, Colorado, Utah, Nevada, New Mexico, and Arizona. The river and its tributaries flow in a natural basin almost surrounded by large mountain ranges and drain 242,000 square miles, an area about 900 miles long from north to south and 300 to 500 miles wide from east to west—practically one-twelfth the area of the continental United States excluding Alaska. Much of this large basin is so arid that it is, as it always has been, largely dependent upon managed use of the waters of the Colorado River System to make it productive and inhabitable. The Master refers to archaeological evidence that as long as 2,000 years ago the ancient Hohokam tribe built and maintained irrigation canals near what is now Phoenix, Arizona, and that American Indians were practicing irrigation in that region at the time white men first explored it. In the second half of the nineteenth century a group of people interested in California's Imperial Valley conceived plans to divert water from the mainstream of the Colorado to give life and growth to the parched and barren soil of that valley. As the most feasible route was through Mexico, a Mexican corporation was formed and a canal dug partly in Mexico and partly in the United States. Difficulties which arose because the canal was subject to the sovereignty of both countries generated hopes in this country that some day there would be a canal wholly within the United States, an all-American canal.7
3
During the latter part of the nineteenth and the first part of the twentieth centuries, people in the Southwest continued to seek new ways to satisfy their water needs, which by that time were increasing rapidly as new settlers moved into this fast-developing region. But none of the more or less primitive diversions made from the mainstream of the Colorado conserved enough water to meet the growing needs of the basin. The natural flow of the Colorado was too erratic, the river at many places in canyons too deep, and the engineering and economic hurdles too great for small farmers, larger groups, or even States to build storage dams, construct canals, and install the expensive works necessary for a dependable year-round water supply. Nor were droughts the basin's only problem; spring floods due to melting snows and seasonal storms were a recurring menace, especially disastrous in California's Imperial Valley where, even after the Mexican canal provided a more dependable water supply, the threat of flood remained at least as serious as before. Another troublesome problem was the erosion of land and the deposit of silt which fouled waters, choked irrigation works, and damaged good farmland and crops.
4
It is not surprising that the pressing necessity to transform the erratic and often destructive flow of the Colorado River into a controlled and dependable water supply desperately needed in so many States began to be talked about and recognized as far more than a purely local problem which could be solved on a farmer-by-farmer, group-by-group, or even state-by-state basis, desirable as this kind of solution might have been. The inadequacy of a local solution was recognized in the Report of the All-American Canal Board of the United States Department of the Interior on July 22, 1919, which detailed the widespread benefits that could be expected from construction by the United States of a large reservoir on the mainstream of the Colorado and an all-American canal to the Imperial Valley.8 Some months later, May 18, 1920, Congress passed a bill offered by Congressman Kinkaid of Nebraska directing the Secretary of the Interior to make a study and report of diversions which might be made from the Colorado River for irrigation in the Imperial Valley.9 The Fall-Davis Report,10 submitted to Congress in compliance with the Kinkaid Act, began by declaring, '(T)he control of the floods and development of the resources of the Colorado River are peculiarly national problems * * *'11 and then went on to give reasons why this was so, concluding with the statement that the job was so big that only the Federal Government could do it.12 Quite naturally, therefore, the Report recommended that the United States construct as a government project not only an all-American canal from the Colorado River to the Imperial Valley but also a dam and reservoir at or near Boulder Canyon.13
5
The prospect that the United States would undertake to build as a national project the necessary works to control floods and store river waters for irrigation was apparently a welcome one for the basin States. But it brought to life strong fears in the northern basin States that additional waters made available by the storage and canal projects might be gobbled up in perpetuity by faster growing lower basin areas, particularly California, before the upper States could appropriate what they believed to be their fair share. These fears were not without foundation, since the law of prior appropriation prevailed in most of the Western States.14 Under that law the one who first appropriates water and puts it to beneficial use thereby acquires a vested right to continue to divert and use that quantity of water against all claimants junior to him in point of time.15 'First in time, first in right' is the short hand expression of this legal principle. In 1922, only four months after the Fall-Davis Report, this Court in Wyoming v. Colorado, 259 U.S. 419, 42 S.Ct. 552, 66 L.Ed. 999, held that the doctrine of prior appropriation could be given interstate effect.16 This decision intensified fears of Upper Basin States that they would not get their fair share of Colorado River water.17 In view of California's phenomenal growth, the Upper Basin States had particular reason to fear that California, by appropriating and using Colorado River water before the upper States, would, under the interstate application of the prior appropriation doctrine, be 'first in time' and therefore 'first in right.' Nor were such fears limited to the northernmost States. Nevada, Utah, and especially Arizona were all apprehensive that California's rapid declaration of appropriative claims would deprive them of their just share of basin water available after construction of the proposed United States project. It seemed for a time that these fears would keep the States from agreeing on any kind of division of the river waters. Hoping to prevent 'conflicts' and 'expensive litigation' which would hold up or prevent the tremendous benefits expected from extensive federal development of the river,18 the basin States requested and Congress passed an Act on August 19, 1921, giving the States consent to negotiate and enter into a compact for the 'equitable division and apportionment * * * of the water supply of the Colorado River.'19
6
Pursuant to this congressional authority, the seven States appointed Commissioners who, after negotiating for the better part of a year, reached an agreement at Santa Fe, New Mexico, on November 24, 1922. The agreement, known as the Colorado River Compact,20 failed to fulfill the hope of Congress that the States would themselves agree on each State's share of the water. The most the Commissioners were able to accomplish in the Compact was to adopt a compromise suggestion of Secretary of Commerce Herbert Hoover, specially designated as United States representative.21 This compromise divides the entire basin into two parts, the Upper Basin and the Lower Basin, separated at a point on the river in northern Arizona known as Lee Ferry. (A map showing the two basins and other points of interest in this controversy is printed as an Appendix facing p. 602.) Article III (a) of the Compact apportions to each basin in perpetuity 7,500,000 acre-feet of water22 a year from the Colorado River System, defined in Article II (a) as 'the Colorado River and its tributaries within the United States of America.' In addition, Article III (b) gives the Lower Basin 'the right to increase its beneficial consumptive use23 of such waters by one million acre-feet per annum.' Article III (c) provides that future Mexican water rights recognized by the United States shall be supplied first out of surplus over and above the aggregate of the quantities specified in (a) and (b), and if this surplus is not enough the deficiency shall be borne equally by the two basins. Article III (d) requires the Upper Basin not to deplete the Lee Ferry flow below an aggregate of 75,000,000 acre-feet for any 10 consecutive years. Article III (f) and (g) provide a way for further apportionment by a compact of 'Colorado River System' waters at any time after October 1, 1963. While these allocations quieted rivalries between the Upper and Lower Basins, major differences between the States in the Lower Basin continued. Failure of the Compact to determine each State's share of the water left Nevada and Arizona with their fears that the law of prior appropriation would be not a protection but a menace because California could use that law to get for herself the lion's share of the waters allotted to the Lower Basin. Moreover, Arizona, because of her particularly strong interest in the Gila, intensely resented the Compact's inclusion of the Colorado River tributaries in its allocation scheme and was bitterly hostile to having Arizona tributaries, again particularly the Gila, forced to contribute to the Mexican burden. Largely for these reasons, Arizona alone, of all the States in both basins, refused to ratify the Compact.24
7
Seeking means which would permit ratification by all seven basin States, the Governors of those States met at Denver in 1925 and again in 1927. As a result of these meetings the Governors of the upper States suggested, as a fair apportionment of water among the Lower Basin States, that out of the average annual delivery of water at Lee Ferry required by the Compact—7,500,000 acre-feet—Nevada be given 300,000 acre-feet, Arizona 3,000,000, and California 4,200,000, and that unapportioned waters, subject to reapportionment after 1963, be shared equally by Arizona and California. Each Lower Basin State would have 'the exclusive beneficial consumptive use of such tributaries within its boundaries before the same empty into the main stream,' except that Arizona tributary waters in excess of 1,000,000 acre-feet could under some circumstances be subject to diminution by reason of a United States treaty with Mexico. This proposal foundered because California held out for 4,600,000 acre-feet instead of 4,200,00025 and because Arizona held out for complete exemption of its tributaries from any part of the Mexican burden.26
8
Between 1922 and 1927 Congressman Philip Swing and Senator Hiram Johnson, both of California, made three attempts to have Swing-Johnson bills enacted, authorizing construction of a dam in the canyon section of the Colorado River and an all-American canal.27 These bills would have carried out the original Fall-Davis Report's recommendations that the river problem be recognized and treated as national, not local. Arizona's Senators and Congressmen, still insisting upon a definite guaranty of water from the mainstream, bitterly fought these proposals because they failed to provide for exclusive use of her own tributaries, particularly the Gila, and for exemption of these tributaries from the Mexican burden.
9
Finally, the fourth Swing-Johnson bill passed both Houses and became the Boulder Canyon Project Act of December 21, 1928, 45 Stat. 1057. The Act authorized the Secretary of the Interior to construct, operate, and maintain a dam and other works in order to control floods, improve navigation, regulate the river's flow, store and distribute waters for reclamation and other beneficial uses, and generate electrical power.28 The projects authorized by the Act were the same as those provided for in the prior defeated measures, but in other significant respects the Act was strikingly different. The earlier bills had offered no method whatever of apportioning the waters among the States of the Lower Basin. The Act as finally passed did provide such a method, and, as we view it, the method chosen was a complete statutory apportionment intended to put an end to the long-standing dispute over Colorado River waters. To protect the Upper Basin against California should Arizona still refuse to ratify the Compact,29 § 4(a) of the Act as finally passed provided that, if fewer than seven States ratified within six months, the Act should not take effect unless six States including California ratified and unless California, by its legislature, agreed 'irrevocably and unconditionally * * * as an express covenant' to a limit on its annual consumption of Colorado River water of 'four million four hundred thousand acre-feet of the waters apportioned to the lower basin States by paragraph (a) of Article III of the Colorado River compact, plus not more than one-half of any excess or surplus waters unapportioned by said compact.' Congress in the same section showed its continuing desire to have California, Arizona, and Nevada settle their own differences by authorizing them to make an agreement apportioning to Nevada 300,000 acre-feet, and to Arizona 2,800,000 acre-feet plus half of any surplus waters unapportioned by the Compact. The permitted agreement also was to allow Arizona exclusive use of the Gila River, wholly free from any Mexican obligation, a position Arizona had taken from the beginning. Sections 5 and 8(b) of the Project Act made provisions for the sale of the stored waters. The Secretary of the Interior was authorized by § 5 'under such general regulations as he may prescribe, to contract for the storage of water in said reservoir and for the delivery thereof at such points on the river and on said canal as may be agreed upon, for irrigation and domestic uses * * *.' Section 5 required these contracts to be 'for permanent service' and further provided, 'No person shall have or be entitled to have the use for any purpose of the water stored as aforesaid except by contract made as herein stated.' Section 8(b) provided that the Secretary's contracts would be subject to any compact dividing the benefits of the water between Arizona, California, and Nevada, or any two of them, approved by Congress on or before January 1, 1929, but that any such compact approved after that date should be 'subject to all contracts, if any, made by the Secretary of the Interior under section 5 hereof prior to the date of such approval and consent by Congress.'
10
The Project Act became effective on June 25, 1929, by Presidential Proclamation,30 after six States, including California, had ratified the Colorado River Compact and the California legislature had accepted the limitation of 4,400,000 acre-feet31 as required by the Act. Neither the three States nor any two of them ever entered into any apportionment compact as authorized by §§ 4(a) and 8(b). After the construction of Boulder Dam the Secretary of the Interior, purporting to act under the authority of the Project Act, made contracts with various water users in California for 5,362,000 acre-feet, with Nevada for 300,000 acre-feet, and with Arizona for 2,800,000 acre-feet of water from that stored at Lake Mead.
11
The Special Master appointed by this Court found that the Colorado River Compact, the law of prior appropriation, and the doctrine of equitable apportionment—by which doctrine this Court in the absence of statute resolves interstate claims according to the equities—do not control the issues in this case. The Master concluded that, since the Lower Basin States had failed to make a compact to allocate the waters among themselves as authorized by §§ 4(a) and 8(b), the Secretary's contracts with the States had within the statutory scheme of §§ 4(a), 5, and 8(b) effected an apportionment of the waters of the mainstream which, according to the Master, were the only waters to be apportioned under the Act. The Master further held that, in the event of a shortage of water making it impossible for the Secretary to supply all the water due California, Arizona, and Nevada under their contracts, the burden of the shortage must be borne by each State in proportion to her share of the first 7,500,000 acre-feet allocated to the Lower Basin, that is, 4.4/7.5 by California, 2.8/7.5 by Arizona, and .3/7.5 by Nevada, without regard to the law of prior appropriation.
12
Arizona, Nevada, and the United States support with few exceptions the analysis, conclusions, and recommendations of the Special Master's report. These parties agree that Congress did not leave division of the waters to an equitable apportionment by this Court but instead created a comprehensive statutory scheme for the allocation of mainstream waters. Arizona, however, believes that the allocation formula established by the Secretary's contracts was in fact the formula required by the Act. The United States, along with California, thinks the Master should not have invalidated the provisions of the Arizona and Nevada water contracts requiring those States to deduct from their allocations any diversions of water above Lake Mead which reduce the flow into that lake.
13
California is in basic disagreement with almost all of the Master's Report. She argues that the Project Act, like the Colorado River Compact, deals with the entire Colorado River System, not just the mainstream. This would mean that diversions within Arizona and Nevada of tributary waters flowing in those States would be charged against their apportionments and that, because tributary water would be added to the mainstream water in computing the first 7,500,000 acre-feet available to the States, there would be a greater likelihood of a surplus, of which California gets one-half. The result of California's argument would be much more water for California and much less for Arizona. California also argues that the Act neither allocates the Colorado River waters nor gives the Secretary authority to make an allocation. Rather the takes the position that the judicial doctrine of equitable apportionment giving full interstate effect to the traditional western water law of prior appropriation should determine the rights of the parties to the water. Finally, California claims that in any event the Act does not control in time of shortage. Under such circumstances, she says, this Court should divide the waters according to the doctrine of equitable apportionment or the law of prior appropriation, either of which, she argues, should result in protecting her prior uses.
14
Our jurisdiction to entertain this suit is not challenged and could not well be since Art. III, § 2, of the Constitution gives this Court original jurisdiction of actions in which States are parties. In exercising that jurisdiction, we are mindful of this Court's often expressed preference that, where possible, States settle their controversies by 'mutual accommodation and agreement.'32 Those cases and others33 make it clear, however, that this Court does have a serious responsibility to adjudicate cases where there are actual existing controversies over how interstate streams should be apportioned among States. This case is the most recent phase of a continuing controversy over the water of the Colorado River, which the States despite repeated efforts have been unable to settle. Resolution of this dispute requires a determination of what apportionment, if any, is made by the Project Act and what powers are conferred by the Act upon the Secretary of the Interior. Unless many of the issues presented here are adjudicated, the conflicting claims of the parties will continue, as they do now, to raise serious doubts as to the extent of each State's right to appropriate water from the Colorado River System for existing or new uses. In this situation we should and do exercise our jurisdiction.
I.
15
ALLOCATION OF WATER AMONG THE STATES AND DISTRIBUTION TO USERS.
16
We have concluded, for reasons to be stated, that Congress in passing the Project Act intended to and did create its own comprehensive scheme for the apportionment among California, Arizona, and Nevada of the Lower Basin's share of the mainstream waters of the Colorado River, leaving each State its tributaries. Congress decided that a fair division of the first 7,500,000 acre-feet of such mainstream waters would give 4,400,000 acre-feet to California, 2,800,000 to Arizona, and 300,000 to Nevada; Arizona and California would each get one-half of any surplus. Prior approval was therefore given in the Act for a tri-state compact to incorporate these terms. The States, subject to subsequent congressional approval, were also permitted to agree on a compact with different terms. Division of the water did not, however, depend on the States' agreeing to a compact, for Congress gave the Secretary of the Interior adequate authority to accomplish the division. Congress did this by giving the Secretary power to make contracts for the delivery of water and by providing that no person could have water without a contract.
17
A. Relevancy of Judicial Apportionment and Colorado River Compact.—We agree with the Master that apportionment of the Lower Basin waters of the Colorado River is not controlled by the doctrine of equitable apportionment or by the Colorado River Compact. It is true that the Court has used the doctrine of equitable apportionment to decide river controversies between States.34 But in those cases Congress had not made any statutory apportionment. In this case, we have decided that Congress has provided its own method for allocating among the Lower Basin States the mainstream water to which they are entitled under the Compact. Where Congress has so exercised its constitutional power over waters courts have no power to substitute their own notions of an 'equitable apportionment' for the apportionment chosen by Congress. Nor does the Colorado River Compact control this case. Nothing in that Compact purports to divide water among the Lower Basin States nor in any way to affect or control any future apportionment among those States or any distribution of water within a State. That the Commissioners were able to accomplish even a division of water between the basins is due to what is generally known as the 'Hoover Compromise.'
18
'Participants (in the Compact negotiations) have stated that the negotiations would have broken up but for Mr. Hoover's proposal: that the Commission limit its efforts to a division of water between the upper basin and the lower basin, leaving to each basin the future internal allocation of its share.'35
19
And in fact this is all the Compact did. However, the Project Act by referring to the Compact in several places, does make the Compact relevant to a limited extent. To begain with, the Act explicitly approves the Compact and thereby fixes a division of the waters between the basins which must be respected. Further, in several places the Act refers to terms contained in the Compact. For example, § 12 of the Act adopts the Compact definition of 'domestic,'36 and § 6 requires satisfaction of 'present perfected rights' as used in the Compact.37 Obviously, therefore, those particular terms, though originally formulated only for the Compact's allocation of water between basins, are incorporated into the Act and are made applicable to the Project Act's allocation among Lower Basin States. The Act also declares that the Secretary of the Interior and the United States in the construction, operation, and maintenance of the dam and other works and in the making of contracts shall be subject to and controlled by the Colorado River Compact.38 These latter references to the Compact are quite different from the Act's adoption of Compact terms. Such references, unlike the explicit adoption of terms, were used only to show that the Act and its provisions were in no way to upset, alter, or affect the Compact's congressionally approved divisions of water between the basins. They were not intended to make the Compact and its provisions control or affect the Act's allocation among and distribution of water within the States of the Lower Basin. Therefore, we look to the Compact for terms specifically incorporated in the Act, and we would also look to it to resolve disputes between the Upper and Lower Basins, were any involved in this case. But no such questions are here. We must determine what apportionment and delivery scheme in the Lower Basin has been effected through the Secretary's contracts. For that determination, we look to the Project Act alone.
20
B. Mainstream Apportionment.—The congressional scheme of apportionment cannot be understood without knowing what water Congress wanted apportioned. Under California's view, which we reject, the first 7,500,000 acre-feet of Lower Basin water, of which California has agreed to use only 4,400,000, is made up of both mainstream and tributary water, not just mainstream water. Under the view of Arizona, Nevada, and the United States, with which we agree, the tributaries are not included in the waters to be divided but remain for the exclusive use of each State. Assuming 7,500,000 acrefeet or more in the mainstream and 2,000,000 in the tributaries, California would get 1,000,000 acre-feet more if the tributaries are included and Arizona 1,000,000 less.39
21
California's argument that the Project Act, like the Colorado River Compact, deals with the main river and all its tributaries rests on § 4(a) of the Act, which limits California to 4,400,000 acre-feet 'of the waters apportioned to the lower basin States by paragraph (a) of Article III of the Colorado River compact plus not more than one-half of any excess or surplus waters unapportioned by said compact * * *.' And Article III(a), referred to by § 4(a), apportioned in perpetuity to the Lower Basin the use of 7,500,000 acre-feet of water per annum 'from the Colorado River System,' which was defined in the Compact as 'that portion of the Colorado River and its tributaries within the United States of america.'
22
Arizona argues that the Compact apportions between basins only the waters of the mainstream, not the mainstream and the tributaries. We need not reach that question, however, for we have concluded that whatever waters the Compact apportioned the Project Act itself dealt only with water of the mainstream. In the first place, the Act, in § 4(a), states that the California limitation, which is in reality her share of the first 7,500,000 acre-feet of Lower Basin water, is on 'water of and from the Colorado River', not of and from the 'Colorado River System.' But more importantly, the negotiations among the States and the congressional debates leading to the passage of the Project Act clearly show that the language used by Congress in the Act was meant to refer to mainstream waters only. Inclusion of the tributaries in the Compact was natural in view of the upper States' strong feeling that the Lower Basin tributaries should be made to share the burden of any obligation to deliver water to Mexico which a future treaty might impose. But when it came to an apportionment among the Lower Basin States, the Gila, by far the most important Lower Basin tributary, would not logically be included, since Arizona alone of the States could effectively use that river.40 Therefore, with minor exceptions, the proposals and counter proposals over the years, culminating in the Project Act, consistently provided for division of the mainstream only, reserving the tributaries to each State's exclusive use.
23
The most important negotiations among the States, which in fact formed the basis of the debates leading to passage of the Act, took place in 1927 when the Governors of the seven basin States met at Denver in an effort to work out an allocation of the Lower Basin waters acceptable to Arizona, California, and Nevada. Arizona and California made proposals,41 both of which suggested giving Nevada 300,000 acre-feet out of the mainstream of the Colorado River and reserving to each State the exclusive use of her own tributaries. Arizona proposed that all remaining mainstream water be divided equally between herself and California, which would give each State 3,600,000 acre-feet out of the first 7,500,000 acre-feet of mainstream water. California rejected the proposed equal division of the water suggesting figures that would result in her getting about 4,600,000 out of the 7,500,000. The Governors of the four Upper Basin States, trying to bring Arizona and California together, asked each State to reduce its demands and suggested this compromise: Nevada 300,000 acre-feet, Arizona 3,000,000, and California 4,200,000.42 These allocations were to come only out of the mainstream, that is, as stated by the Governors, out of 'the average annual delivery of water to be provided by the states of the upper division at Lees Ferry, under the terms of the Colorado River Compact.' The Governors' suggestions, like those of the States, explicitly reserved to each State as against the other States the exclusive use of her own tributaries. Arizona agreed to the Governors' proposal, but she wanted it made clear that her tributaries were to be exempted from any Mexican obligation.43 California rejected the whole proposal, insisting that she must have 4,600,000 acre-feet from the mainstream, or, as she put it, 'from the waters to be provided by the States of the upper division at Lee Ferry under the Colorado River compact.'44 Neither in the States' original offers, nor in the Governors' suggestions nor in the States' responses was the 'Colorado River System' mainstream plus tributaries—ever used as the basis for Lower Basin allocations; rather, it was always mainstream water, or the water to be delivered by the upper States at Lee Ferry, that is to say, an annual average of 7,500,000 acre-feet of mainstream water.
24
With the continued failure of Arizona and California to reach accord, there was mounting impetus for a congressional solution. A Swing-Johnson bill containing no limitation on California's uses finally passed the House in 1928 over objections by Representatives from Arizona and Utah.45 When the bill reached the Senate, it was amended in committee to provide that the Secretary in his water delivery contracts must limit California to 4,600,000 acre-feet 'of the water allocated to the lower basin by the Colorado River compact * * * and one-half of the unallocated, excess, and/or surplus water * * *.'46 On the floor, Senator Phipps of Colorado proposed an amendment which would allow the Act to go into effect without any limitation on California if seven States ratified the Compact; if only six States ratified and if the California Legislature accepted the limitation, the Act could still become effective.47 Arizona's Senator Hayden had already proposed an amendment reducing California's share to 4,200,000 acre-feet (the Governors' proposal), plus half of the surplus, leaving Arizona exclusive use of the Gila free from any Mexican obligation,48 but this the Senate rejected.49 Senator Bratton of New Mexico, noting that only 400,000 acre-feet kept Arizona and California apart, immediately suggested an amendment by which they would split the difference, California getting 4,400,000 acre-feet 'of the waters apportioned to the lower basin States by the Colorado River compact,' plus half of the surplus.50 It was this Bratton amendment that became part of the Act as passed,51 which had been amended on the floor so that the limitation referred to waters apportioned to the Lower Basin 'by paragraph (a) of Article III of the Colorado River compact,' instead of waters apportioned 'by the Colorado River compact.'52
25
Statements made throughout the debates make it quite clear that Congress intended the 7,500,000 acre-feet it was allocating, and out of which California was limited to 4,400,000, to be mainstream water only. In the first place, the basin Senators expressly acknowledged as the starting point for their debate the Denver Governors' proposal that specific allocations be made to arizona, California, and Nevada from the mainstream, leaving the tributaries to the States. For example, Senator Johnson, leading spokesman for California, and Senator Hayden, leading spokesman for Arizona, agreed that the Governors' recommendations could be used as 'a basis for discussion.'53 Hayden went on to observe that the Committee amendment would give California the same 4,600,000 acre-feet she had sought at Denver.54 Later, Nevada's Senator Pittman stated that the committee 'put the amount in there that California demanded before the four governors at Denver,' and said that the Bratton amendment would split the 400,000 acre-feet separating the Governors' figure and the Committee's figure.55 All the leaders in the debate—Johnson, Bratton, King, Hayden, Phipps, and Pittman—expressed a common understanding that the key issue separating Arizona and California was the difference of 400,000 acre-feet,56 precisely the same 400,000 acre-feet of mainstream water that had separated the States at Denver. Were we to sustain California's argument here that tributaries must be included, California would actually get more than she was willing to settle for at Denver.
26
That the apportionment was from the mainstream only is also strongly indicated by an analysis of the second paragraph of § 4(a) of the Act. There Congress authorized Arizona, Nevada, and California to make a compact allocating to Nevada 300,000 acre-feet and to Arizona 2,800,000 plus one-half of the surplus, which, with California's 4,400,000 and half of the surplus, would under California's interpretation of the Act exhaust the Lower Basin waters, both mainstream and tributaries. But Utah and New Mexico, as Congress knew, had interests in Lower Basin tributaries which Congress surely would have protected in some way had it meant for the tributaries of those two States to be included in the water to be divided among Arizona, Nevada, and California. We cannot believe that Congress would have permitted three States to divide among themselves water belonging to five States. Nor can we believe that the representatives of Utah and New Mexico would have sat quietly by and acquiesced in a congressional attempt to include their tributaries in waters given the other three States.
27
Finally, in considering California's claim to share in the tributaries of other States, it is important that from the beginning of the discussions and negotiations which led to the Project Act, Arizona consistently claimed that she must have sole use of the Gila, upon which her existing economy depended.57 Arizona's claim was supported by the fact that only she and New Mexico could effectively use the Gila waters, which not only entered the Colorado River too close to Mexico to be of much use to any other State but also was reduced virtually to a trickle in the hot Arizona summers before it could reach the Colorado. In the debates the Senators consistently acknowledged that the tributaries—or at least the waters of the Gila, the only major Arizona tributary—were excluded from the allocation they were making. Senator Hayden, in response to questions by Senator Johnson, said that the California Senator was correct in stating that the Senate had seen fit to give Arizona 2,800,000 acre-feet in addition to all the water in the Gila.58 Senator Johnson had earlier stated, '(i)t is only the main stream, Senators will recall, that has been discussed,' and one of his arguments in favor of California's receiving 4,600,000 acre-feet rather than 4,200,000 was that Arizona was going to keep all her tributaries in addition to whatever portion of the main river was allocated to her.59 Senator Johnson also argued that Arizona should bear more than half the Lower Basin's Mexican burden because in addition to the 2,800,000 acre-feet allotted her by the Act she would get the Gila, which he erroneously estimated at 3,500,000 acre-feet.60 Senator Pittman, who had sat in on the Governors' conference, likewise understood that the water was being allocated from 'the main Colorado River.'61 And other interested Senators similarly distinguished between the mainstream and the tributaries.62 While the debates, extending over a long period of years, undoubtedly contain statements which support inferences in conflict with those we have drawn, we are persuaded by the legislative history as a whole that the Act was not intended to give California any claim to share in the tributary waters of the other Lower Basin States.
28
C. The Project Act's Apportionment and Distribution Scheme. The legislative history, the language of the Act, and the scheme established by the Act for the storage and delivery of water convince us also that Congress intended to provide its own method for a complete apportionment of the mainstream water among Arizona, California, and Nevada.
29
First, the legislative history. In hearings on the House bill that became the Project Act, Congressman Arentz of Nevada, apparently impatient with the delay of this much needed project, told the committee on January 6, 1928, that if the States could not themselves allocate the water, 'there must be some power which will say to California 'You can not take any more than this amount and the balance is allocated to the other States."63 Later, May 25, 1928, the House passed the bill,64 but it did not contain any allocation scheme. When the Senate took up that bill in December, pressure mounted swiftly for amendments that would provide a workable method for apportioning the waters among the Lower Basin States and distributing them to users in the States. The session convened on December 3, 1928, on the fifth the Senate took up the bill,65 nine days later the bill with significant amendments passed the Senate,66 four days after that the House concurred in the Senate's action,67 and on the twenty-first the President signed the bill.68 When the bill first reached the Senate floor, it had a provision, added in committee, limiting California to 4,600,000 acre-feet,69 and Senator Hayden on December 6 proposed reducing that share to 4,200,000.70 The next day, December 7, Mr. Pittman, senior Senator from Nevada, vigorously argued that Congress should settle the matter without delay. He said,
30
'What is the difficulty? We have only minor questions involved here. There is practically nothing involved except a dispute between the States of Arizona and California with regard to the division of the increased water that will be impounded behind the proposed dam; that is all. * * * Of the 7,500,000 acre-feet of water let down that river they have gotten together within 400,000 acre-feet. They have got to get together, and if they do not get together Congress should bring them together.'71
31
The day after that, December 8, New Mexico's Senator Bratton suggested an amendment splitting the difference between the demands of Arizona and California by limiting California to 4,400,000 acre-feet.72 On the tenth, reflecting the prevailing sense of urgency for decisive action, Senator Bratton emphasized that this was not a dispute limited simply to two States:
32
'The two States have exchanged views, they have negotiated, they have endeavored to reach an agreement, and until now have been unable to do so. This controversy does not affect those two States alone. It affects other States in the Union and the Government as well.
33
'Without undertaking to express my views either way upon the subject, I do think that if the two States are unable to agree upon a figure then that we, as a disinterested and friendly agency, should pass a bill which, according to our combined judgment, will justly and equitably settle the controversy. I suggested 4,400,000 acre-feet with that in view. I still hold to the belief that somewhere between the two figures we must fix the amount, and that this difference of 400,000 acre-feet should not be allowed to bar and preclude the passage of this important measure dealing with the enormous quantity of 15,000,000 acre-feet of water and involving seven States as well as the Government.'73
34
The very next day, December 11, this crucial amendment was adopted,74 and on the twelfth Senator Hayden pointed out that the bill settled the dispute over Lower Basin waters by giving 4,400,000 acre-feet to California and 2,800,000 to Arizona:
35
'One (dispute) is how the seven and a half million acre-feet shall be divided in the lower basin. The Senate has settled that by a vote—that California may have 4,400,000 acre-feet of that water. It follows logically that if the demand is to be conceded, as everybody agrees, the remainder is 2,800,000 acre-feet for Arizona. That settles that part of the controversy.'75
36
On the same day, Senator Pittman, intimately familiar with the whole water problem,76 summed up the feeling of the Senate that the bill fixed a limit on California and 'practically allocated' to Arizona her share of the water:
37
'The Senate has already determined upon the division of water between those States. How? It has determined how much water California may use, and the rest of it is subject to use by Nevada and Arizona. Nevada has already admitted that it can use only an insignificant quantity, 300,000 acre-feet. That leaves the rest of it to Arizona. As the bill now stands it is just as much divided as if they had mentioned Arizona and Nevada and the amounts they are to get. * * *
38
'As I understand this amendment, Arizona to-day has practically allocated to it 2,800,000 acre-feet of water in the main Colorado River.'77
39
The Senator went on to explain why the Senate had found it necessary to set up its own plan for allocating the water:
40
'Why do we not leave it to California to say how much water she shall take out of the river or leave it to Arizona to say how much water she shall take out of the river? It is because it happens to become a duty of the United States Senate to settle this matter, and that is the reason.'78
41
Not only do the closing days of the debate show that Congress intended an apportionment among the States but also provisions of the Act create machinery plainly adequate to accomplish this purpose, whatever contingencies might occur. As one alternative of the congressional scheme, § 4(a) of the Act invited Arizona, California, and Nevada to adopt a compact dividing the waters along the identical lines that had formed the basis for the congressional discussions of the Act: 4,400,000 acre-feet to California, 300,000 to Nevada, and 2,800,000 to Arizona. Section 8(b) gave the States power to agree upon some other division, which would have to be approved by Congress. Congress made sure, however, that if the States did not agree on any compact the objects of the Act would be carried out, for the Secretary would then proceed, by making contracts, to apportion water among the States and to allocate the water among users within each State.
42
In the first section of the Act, the Secretary was authorized to 'construct, operate, and maintain a dam and incidental works * * * adequate to create a storage reservoir of a capacity of not less than twenty million acre-feet of water * * *' for the stated purpose of 'controlling the floods, improving navigation and regulating the flow of the Colorado River, providing for storage and for the delivery of the stored waters thereof for reclamation of public lands and other beneficial uses * * *,' and generating electrical power. The whole point of the Act was to replace the erratic, undependable, often destructive natural flow of the Colorado with the regular, dependable release of waters conserved and stored by the project. Having undertaken this beneficial project, Congress, in several provisions of the Act, made it clear that no one should use mainstream waters save in strict compliance with the scheme set up by the Act. Section 5 authorized the Secretary 'under such general regulations as he may prescribe, to contract for the storage of water in said reservoir and for the delivery thereof at such points on the river * * * as may be agreed upon, for irrigation and domestic uses * * *.' To emphasize that water could be obtained from the Secretary alone, § 5 further declared, 'No person shall have or be entitled to have the use for any purpose of the water stored as aforesaid except by contract made as herein stated.' The supremacy given the Secretary's contracts was made clear in § 8(b) of the Act, which provided that, while the Lower Basin States were free to negotiate a compact dividing the waters, such a compact if made and approved after January 1, 1929, was to be 'subject to all contracts, if any, made by the Secretary of the Interior under section 5' before Congress approved the compact.
43
These several provisions, even without legislative history, are persuasive that Congress intended the Secretary of the Interior, through his § 5 contracts, both to carry out the allocation of the waters of the main Colorado River among the Lower Basin States and to decide which users within each State would get water. The general authority to makes contracts normally includes the power to choose with whom and upon what terms the contracts will be made. When Congress in an Act grants authority to contract, that authority is no less than the general authority, unless Congress has placed some limit on it.79 In this respect it is of interest that in an earlier version the bill did limit the Secretary's contract power by making the contracts 'subject to rights of prior appropriators.'80 But that restriction, which preserved the law of prior appropriation, did not survive. It was stricken from the bill when the requirement that every water user have a contract was added to § 5.81 Significantly, no phrase or provision indicating that the Secretary's contract power was to be controlled by the law of prior appropriation was substituted either then or at any other time before passage of the Act, and we are persuaded that had Congress intended so to fetter the Secretary's discretion, it would have done so in clear and unequivocal terms, as it did in recognizing 'present perfected rights' in § 6.
44
That the bill was giving the Secretary sufficient power to carry out an allocation of the waters among the States and among the users within each State without regard to the law of prior appropriation was brought out in a colloquy between Montana's Senator Walsh and California's Senator Johnson, whose State had at least as much reason as any other State to bind the Secretary by state laws. Senator Walsh, who was thoroughly versed in western water law and also had previously argued before this Court in a leading case involving the doctrine of prior appropriation,82 made clear what would follow from the Government's impounding of the Colorado River waters when he said, 'I always understood that the interest that stores the water has a right superior to prior appropriations that do not store.' He sought Senator Johnson's views on what rights the City of Los Angeles, which had filed claims to large quantities of Colorado River water, would have after the Government had built the dam and impounded the waters. In reply to Senator Walsh's specific question whether the Government might 'dispose of the stored water as it sees fit.' Senator Johnson said,'Yes; under the terms of this bill.' Senator Johnson added that 'everything in this scheme, plan, or design' was 'dependent upon the Secretary of the Interior contracting with those who desire to obtain the benefit of the construction * * *.' He admitted that it was possible that the Secretary could 'utterly ignore' Los Angeles' appropriations.83
45
In this same discussion, Senator Hayden emphasized the Secretary's power to allocate the water by making contracts with users. After Senator Walsh said that he understood Senator Johnson to be arguing that the Secretary must satisfy Los Angeles' appropriations, Senator Hayden corrected him, pointing out that Senator Johnson had qualified his statement by saying that 'after all, the Secretary of the Interior could allow the city of Los Angeles to have such quantity of water as might be determined by contract.' Senator Hayden went on to say that, where domestic and irrigation needs conflicted, 'the Secretary of the Interior will naturally decide as between applicants, one who desires to use the water for potable purposes in the city and another who desires to use it for irrigation, if there is not enough water to go around, that the city shall have the preference.'84 It is also significant that two vigorous opponents of the bill, Arizona's Representative Douglas and Utah's Representative Colton, criticized the bill because it gave the Secretary of the Interior 'absolute control' over the disposition of the stored waters.85
46
The argument that Congress would not have delegated to the Secretary so much power to apportion and distribute the water overlooks the ways in which his power is limited and channeled by standards in the Project Act. In particular, the Secretary is bound to observe the Act's limitation of 4,400,000 acre-feet on California's consumptive uses out of the first 7,500,000 acre-feet of mainstream water. This necessarily leaves the remaining 3,100,000 acre-feet for the use of Arizona and Nevada, since they are the only other States with access to the main Colorado River. Nevada consistently took the position, accepted by the other States throughout the debates, that her conceivable needs would not exceed 300,000 acre-feet, which of course, left 2,800,000 acre-feet for Arizona's use. Moreover, Congress indicated that it thought this a proper division of the waters when in the second paragraph of § 4(a) it gave advance consent to a tri-state compact adopting such division. While no such compact was ever entered into, the Secretary by his contracts has apportioned the water in the approved amounts and thereby followed the guidelines set down by Congress. and, as the Master pointed out, Congress set up other standards and placed other significant limitations upon the Secretary's power to distribute the stored waters. It specifically set out in order the purposes for which the Secretary must use the dam and the reservoir:
47
'First, for river regulation, improvement of navigation, and flood control; second, for irrigation and domestic uses and satisfaction of present perfected rights in pursuance of Article VIII of said Colorado River compact; and third, for power.' § 6.
48
The Act further requires the Secretary to make revenue provisions in his contracts adequate to ensure the recovery of the expenses of construction, operation, and maintenance of the dam and other works within 50 years after their construction. § 4(b). The Secretary is directed to make water contracts for irrigation and domestic uses only for 'permanent service.' § 5. He and his permittees, licensees, and contractees are subject to the Colorado River Compact, § 8(a), and therefore can do nothing to upset or encroach upon the Compact's allocation of Colorado River water between the Upper and Lower Basins. In the construction, operation, and management of the works, the Secretary is subject to the provisions of the reclamation law, except as the Act otherwise provides. § 14. One of the most significant limitations in the Act is that the Secretary is required to satisfy present perfected rights, a matter of intense importance to those who had reduced their water rights to actual beneficial use at the time the Act became effective. § 6. And, of course, all of the powers granted by the Act are exercised by the Secretary and his well-established executive department, responsible to Congress and the President and subject to judicial review.86
49
Notwithstanding the Government's construction, ownership, operation, and maintenance of the vast Colorado River works that conserve and store the river's waters and the broad power given by Congress to the Secretary of the Interior to make contracts for the distribution of the water, it is argued that Congress in §§ 14 and 18 of the Act took away practically all the Secretary's power by permitting the States to determine with whom and on what terms the Secretary would make water contracts. Section 18 states:
50
'Nothing herein shall be construed as interfering with such rights as the States now have either to the waters within their borders or to adopt such policies and enact such laws as they may deem necessary with respect to the appropriation, control, and use of waters within their borders * * *.'
51
Section 14 provides that the reclamation law, to which the Act is made a supplement, shall govern the management of the works except as otherwise provided, and § 8 of the Reclamation Act, much like § 18 of the Project Act, provides that it is not to be construed as affecting or interfering with state laws 'relating to the control, appropriation, use, or distribution of water used in irrigation * * *.'87 In our view, nothing in any of these provisions affects our decision, stated earlier, that it is the Act and the Secretary's contracts, not the law of prior appropriation, that control the apportionment of water among the States. Moreover, contrary to the Master's conclusion, we hold that the Secretary in choosing between users within each State and in settling the terms of his contracts is not bound by these sections to follow state law.
52
The argument that § 8 of the Reclamation Act requires the United States in the delivery of water to follow priorities laid down by state law has already been disposed of by this Court in Ivanhoe Irr. Dist. v. McCracken, 357 U.S. 275, 78 ,S.Ct. 1174, 2 L.Ed.2d 1313 (1958), and reaffirmed in City of Fresno v. California, 372 U.S. 627, 83 S.Ct. 996 (1963). In Ivanhoe we held that, even though § 8 of the Reclamation Act preserved state law, that general provision could not override a specific provision of the same Act prohibiting a single landowner from getting water for more than 160 acres. We said:
53
'As we read § 8, it merely requires the United States to comply with state law when, in the construction and operation of a reclamation project, it becomes necessary for it to acquire water rights or vested interests therein. But the acquisition of water rights must not be confused with the operation of federal projects. As the Court said in State of Nebraska v. State of Wyoming, supra, 325 U.S. at page 615, 65 S.Ct. at page 1349: 'We do not suggest that where Congress has provided a system of regulation for federal projects it must give way before an inconsistent state system.' * * * We read nothing in § 8 that compels the United States to deliver water on conditions imposed by the State.' Id., 357 U.S. at 291—292, 78 S.Ct. at 1183—1184.
54
Since § 8 of the Reclamation Act did not subject the Secretary to state law in disposing of water in that case, we cannot, consistently with Ivanhoe, hold that the Secretary must be bound by state law in disposing of water under the Project Act.
55
Nor does § 18 of the Project Act require the Secretary to contract according to state law. That Act was passed in the exercise of congressional power to control navigable water for purposes of flood control, navigation, power generation, and other objects,88 and is equally sustained by the power of Congress to promote the general welfare through projects for reclamation, irrigation, or other internal improvements.89 Section 18 merely preserves such rights as the States 'now' have, that is, such rights as they had at the time the Act was passed. While the States were generally free to exercise some jurisdiction over these waters before the Act was passed, this right was subject to the Federal Government's right to regulate and develop the river.90 Where the Government, as here, has exercised this power and undertaken a comprehensive project for the improvement of a great river and for the orderly and beneficial distribution of water, there is no room for inconsistent state laws.91 As in Ivanhoe, where the general provision preserving state law was held not to override a specific provision stating the terms for disposition of the water, here we hold that the general saving language of § 18 cannot bind the Secretary by state law and thereby nullify the contract power expressly conferred upon him by § 5.92 Section 18 plainly allows the States to do things not inconsistent with the Project Act or with federal control of the river, for example, regulation of the use of tributary water and protection of present perfected rights.93 What other things the States are free to do can be decided when the occasion arises. But where the Secretary's contracts, as here, carry out a congressional plan for the complete distribution of waters to users, state law has no place.94
56
Before the Project Act was passed, the waters of the Colorado River, though numbered by the millions of acre-feet, flowed too haltingly or to freely, resulting in droughts and floods. The problems caused by these conditions proved too immense and the solutions too costly for any one State or all the States together. In addition, the States, despite repeated efforts at a settlement, were unable to agree on how much water each State should get. With the health and growth of the Lower Basin at stake, Congress responded to the pleas of the States to come to their aid. The result was the Project Act and the harnessing of the bountiful waters of the Colorado to sustain growing cities, to support expanding industries, and to transform dry and barren deserts into lands that are livable and productive.
57
In undertaking this ambitious and expensive project for the welfare of the people of the Lower Basin States and of the Nation, the United States assumed the responsibility for the construction, operation, and supervision of Boulder Dam and a great complex of other dams and works. Behind the dam were stored virtually all the waters of the main river, thus impounding not only the natural flow but also the great quantities of water previously allowed to run waste or to wreak destruction. The impounding of these waters, along with their regulated and systematic release to those with contracts, has promoted the spectacular development of the Lower Basin. Today, the United States operates a whole network of useful projects up and down the river, including the Hoover Dam, Davis Dam, Parker Dam, Headgate Rock Dam, Palo Verde Dam, Imperial Dam, Laguna Dam, Morelos Dam, and the All-American Canal System, and many lesser works. It was only natural that the United States, which was to make the benefits available and which had accepted the responsibility for the project's operation, would want to make certain that the waters were effectively used. All this vast, interlocking machinery—a dozen major works delivering water according to congressionally fixed priorities for home, agricultural, and industrial uses to people spread over thousands of square miles—could function efficiently only under unitary management, able to formulate and supervise a coordinated plan that could take account of the diverse, often conflicting interests of the people and communities of the Lower Basin States. Recognizing this, Congress put the Secretary of the Interior in charge of these works and entrusted him with sufficient power, principally the § 5 contract power, to direct, manage, and coordinate their operation. Subjecting the Secretary to the varying, possibly inconsistent, commands of the different state legislatures could frustrate efficient operation of the project and thwart full realization of the benefits Congress intended this national project to bestow. We are satisfied that the Secretary's power must be construed to permit him, within the boundaries set down in the Act, to allocate and distribute the waters of the mainstream of the Colorado River.
II.
58
PROVISIONS IN THE SECRETARY'S CONTRACTS.
59
A. Diversions above Lake Mead.—The Secretary's contracts with Arizona and Nevada provide that any waters diverted by those States out of the mainstream or the tributaries above Lake Mead must be charged to their respective Lower Basin apportionments. The Master, however, took the view that the apportionment was to be made out of the waters actually stored at Lake Mead or flowing in the mainstream below Lake Mead. He therefore held that the Secretary was without power to charge Arizona and Nevada for diversions made by them from the 275-mile stretch of river between Lee Ferry and Lake Mead95 or from the tributaries above Lake Mead. This conclusion was based on the Master's reasoning that the Secretary was given physical control over the waters stored in Lake Mead and not over waters before they reached the lake.
60
We hold that the Master was correct in deciding that the Secretary cannot reduce water deliveries to Arizona and Nevada by the amount of their uses from tributaries above Lake Mead, for, as we have held, Congress in the Project Act intended to apportion only the mainstream, leaving to each State its own tributaries. We disagree, however, with the Master's holding that the Secretary is powerless to charge States for diversions from the mainstream above Lake Mead. What Congress was doing in the Project Act was providing for an apportionment among the Lower Basin States of the water allocated to that basin by the Colorado River Compact. The Lower Basin, with which Congress was dealing, begins at Lee Ferry, and it was all the water in the mainstream below Lee Ferry that Congress intended to divide among the States. Were we to refuse the Secretary the power to charge States for diversions from the mainstream between Lee Ferry and the damsite, we would allow individual States, by making diversions that deplete the Lower Basin's allocation, to upset the whole plan of apportionment arrived at by Congress to settle the long-standing dispute in the Lower Basin. That the congressional apportionment scheme would be upset can easily be demonstrated. California, for example, has been allotted 4,400,000 acre-feet of mainstream water. If Arizona and Nevada can, without being charged for it, divert water from the river above Lake Mead, then California could not get the share Congress intended her to have.
61
B. Nevada Contract.—Nevada has excepted to her inclusion in Paragraph II(B) (7) of the Master's recommended decree, which provides that 'mainstream water shall be delivered to users in Arizona, California and Nevada only if contracts have been made by the Secretary of the Interior, pursuant to Section 5 of the Boulder Canyon Project Act, for delivery of such water.' While the California contracts are directly with water users and the Arizona contract specifically contemplates further subcontracts with actual users, it is argued that the Nevada contract, made by the Secretary directly with the State of Nevada through her Colorado River Commission, should be construed as a contract to deliver water to the State without the necessity of subcontracts by the Secretary directly with Nevada water users. The United States disagrees, contending that properly construed the Nevada contract, like the Secretary's general contract with Arizona, does not exhaust the Secretary's power to require Nevada water users other than the State to make further contracts. To construe the Nevada contract otherwise, the Government suggests, would bring it in conflict with the provision of § 5 of the Project Act that 'No person shall have or be entitled to have the use for any purpose of the water stored as aforesaid except by contract (with the Secretary) made as herein stated.' Acceptance of Nevada's contention here would not only undermine this plain congressional requirement that water users have contracts with the Secretary but would likewise transfer from the Secretary to Nevada a large part, if not all, of the Secretary's power to determine with whom he will contract and on what terms. We have already held that the contractual power granted the Secretary cannot be diluted in this manner. We therefore reject Nevada's contention.
III.
62
APPORTIONMENT AND CONTRACTS IN TIME OF SHORTAGE.
63
We have agreed with the Master that the Secretary's contracts with Arizona for 2,800,000 acre-feet of water and with Nevada for 300,000, together with the limitation of California to 4,400,000 acre-feet, effect a valid apportionment of the first 7,500,000 acre-feet of mainstream water in the Lower Basin. There remains the question of what shall be done in time of shortage. The Master, while declining to make any findings as to what future supply might be expected, nevertheless decided that the Project Act and the Secretary's contracts require the Secretary in case of shortage to divide the burden among the three States in this proportion: California 4.4/7.5; Arizona 2.8/7.5; Nevada .3/7.5. While pro rata sharing of water shortages seems equitable on its face,96 more considered judgment may demonstrate quite the contrary. Certainly we should not bind the Secretary to this formula. We have held that the Secretary is vested with considerable control over the apportionment of Colorado River waters. And neither the Project Act nor the water contracts require the use of any particular formula for apportioning shortages. While the Secretary must follow the standards set out in the Act, he nevertheless is free to choose among the recognized methods of apportionment or to devise reasonable methods of his own. This choice, as we see it, is primarily his, not the Master's or even ours. And the Secretary may or may not conclude that a pro rata division is the best solution.
64
It must be remembered that the Secretary's decision may have an effect not only on irrigation uses but also on other important functions for which Congress brought this great project into being flood control, improvement of navigation, regulation of flow, and generation and distribution of electric power. Requiring the Secretary to prorate shortages would strip him of the very power of choice which we think Congress, for reasons satisfactory to it, vested in him and which we should not impair or take away from him. For the same reasons we cannot accept California's contention that in case of shortage each State's share of water should be determined by the judicial doctrine of equitable apportionment or by the law of prior appropriation. These principles, while they may provide some guidance, are not binding upon the Secretary where, as here, Congress, with full power to do so, has provided that the waters of a navigable stream shall be harnessed, conserved, stored, and distributed through a government agency under a statutory scheme.
65
None of this is to say that in case of shortage, the Secretary cannot adopt a method of proration or that he may not lay stress upon priority of use, local laws and customs, or any other factors that might be helpful in reaching an informed judgment in harmony with the Act, the best interests of the Basin States, and the welfare of the Nation. It will be time enough for the courts to intervene when and if the Secretary, in making apportionments or contracts, deviates from the standards Congress has set for him to follow, including his obligation to respect 'present perfected rights' as of the date the Act was passed. At this time the Secretary has made no decision at all based on an actual or anticipated shortage of water, and so there is no action of his in this respect for us to review. Finally, as the Master pointed out, Congress still has broad powers over this navigable international stream. Congress can undoubtedly reduce or enlarge the Secretary's power if it wishes. Unless and until it does, we leave in the hands of the Secretary, where Congress placed it, full power to control, manage, and operate the Government's Colorado River works and to make contracts for the sale and delivery of water on such terms as are not prohibited by the Project Act.
IV.
ARIZONA-NEW MEXICO GILA CONTROVERSY.
66
Arizona and New Mexico presented the Master with conflicting claims to water in the Gila River, the tributary that rises in New Mexico and flows through Arizona. Having determined that tributaries are not within the regulatory provisions of the Project Act the Master held that this interstate dispute should be decided under the principles of equitable apportionment. After hearing evidence on this issue, the Master accepted a compromise settlement agreed upon by these States and incorporated that settlement in his findings and conclusions, and in Part IV(A)(B)(C)(D) of his recommended decree. No exceptions have been filed to these recommendations by any of the parties and they are accordingly accepted by us. Except for those discussed in Part V, we are not required to decide any other disputes between tributary users or between mainstream and tributary users.
V.
67
CLAIMS OF THE UNITED STATES.
68
In these proceedings, the United States has asserted claims to waters in the main river and in some of the tributaries for use on Indian Reservations, National Forests, Recreational and Wildlife Areas and other government lands and works. While the Master passed upon some of these claims, he declined to reach others, particularly those relating to tributaries. We approve his decision as to which claims required adjudication, and likewise we approve the decree he recommended for the government claims he did decide. We shall discuss only the claims of the United States on behalf of the Indian Reservations.
69
The Government, on behalf of five Indian Reservations in Arizona, California, and Nevada, asserted rights to water in the mainstream of the Colorado River.97 The Colorado River Reservation, located partly in Arizona and partly in California, is the largest. It was originally created by an Act of Congress in 1865,98 but its area was later increased by Executive Order.99 Other reservations were created by Executive Orders and amendments to them ranging in dates from 1870 to 1907.100 The Master found both as a matter of fact and law that when the United States created these reservations or added to them, it reserved not only land but also the use of enough water from the Colorado to irrigate the irrigable portions of the reserved lands. The aggregate quantity of water which the Master held was reserved for all the reservations is about 1,000,000 acre-feet, to be used on around 135,000 irrigable acres of land. Here, as before the Master, Arizona argues that the United States had no power to make a reservation of navigable waters after Arizona became a State; that navigable waters could not be reserved by Executive Orders; that the United States did not intend to reserve water for the Indian Reservations; that the amount of water reserved should be measured by the reasonably foreseeable needs of the Indians living on the reservation rather than by the number of irrigable acres; and, finally, that the judicial doctrine of equitable apportionment should be used to divide the water between the Indians and the other people in the State of Arizona.
70
The last argument is easily answered. The doctrine of equitable apportionment is a method of resolving water disputes between States. It was created by this Court in the exercise of its original jurisdiction over controversies in which States are parties. An Indian Reservation is not a State. And while Congress has sometimes left Indian Reservations considerable power to manage their own affairs, we are not convinced by Arizona's argument that each reservation is so much like a State that its rights to water should be determined by the doctrine of equitable apportionment. Moreover, even were we to treat an Indian Reservation like a State, equitable apportionment would still not control since, under our view, the Indian claims here are governed by the statutes and Executive Orders creating the reservations.
71
Arizona's contention that the Federal Government had no power, after Arizona became a State, to reserve waters for the use and benefit of federally reserved lands rests largely upon statements in Pollard's Lessee v. Hagan, 3 How. 212, 11 L.Ed. 565 (1845), and Shively v. Bowlby, 152 U.S. 1, 14 S.Ct. 548, 38 L.Ed. 331 (1894). Those cases and others that followed them101 gave rise to the doctrine that lands underlying navigable waters within territory acquired by the Government are held in trust for future States and that title to such lands is automatically vested in the States upon admission to the Union. But those cases involved only the shores of and lands beneath navigable waters. They do not determine the problem before us and cannot be accepted as limiting the broad powers of the United States to regulate navigable waters under the Commerce Clause and to regulate government lands under Art. IV, § 3, of the Constitution. We have no doubt about the power of the United States under these clauses to reserve water rights for its reservations and its property.
72
Arizona also argues that, in any event, water rights cannot be reserved by Executive Order. Some of the reservations of Indian lands here involved were made almost 100 years ago, and all of them were made over 45 years ago. In our view, these reservations, like those created directly by Congress, were not limited to land, but included waters as well. Congress and the Executive have ever since recognized these as Indian Reservations. Numerous appropriations, including appropriations for irrigation projects, have been made by Congress. They have been uniformly and universally treated as reservations by map makers, surveyors, and the public. We can give but short shrift at this late date to the argument that the reservations either of land or water are invalid because they were originally set apart by the Executive.102
73
Arizona also challenges the Master's holding as to the Indian Reservations on two other grounds: first, that there is a lack of evidence showing that the United States in establishing the reservations intended to reserve water for them; second, that even if water was meant to be reserved the Master has awarded too much water. We reject both of these contentions. Most of the land in these reservations is and always has been arid. If the water necessary to sustain life is to be had, it must come from the Colorado River or its tributaries. It can be said without overstatement that when the Indians were put on these reservations they were not considered to be located in the most desirable area of the Nation. It is impossible to believe that when Congress created the great Colorado River Indian Reservation and when the Executive Department of this Nation created the other reservations they were unaware that most of the lands were of the desert kind—hot, scorching sands—and that water from the river would be essential to the life of the Indian people and to the animals they hunted and the crops they raised. In the debate leading to approval of the first congressional appropriation for irrigation of the Colorado River Indian Reservation, the delegate from the Territory of Arizona made this statement:
74
'Irrigating canals are essential to the prosperity of these Indians. Without water there can be no production, no life; and all they ask of you is to give them a few agricultural implements to enable them to dig an irrigating canal by which their lands may be watered and their fields irrigated, so that they may enjoy the means of existence. You must provide these Indians with the means of subsistence or they will take by robbery from those who have. During the last year I have seen a number of these Indians starved to death for want of food.' Cong. Globe, 38th Cong., 2d Sess. 1321 (1865).
75
The question of the Government's implied reservation of water rights upon the creation of an Indian Reservation was before this Court in Winters v. United States, 207 U.S. 564, 28 S.Ct. 207, 52 L.Ed. 340, decided in 1908. Much the same argument made to us was made in Winters to persuade the Court to hold that Congress had created an Indian Reservation without intending to reserve waters necessary to make the reservation livable. The Court rejected all of the arguments. As to whether water was intended to be reserved the Court said, 207 U.S. at p. 576, 28 S.Ct. at page 211:
76
'The lands were arid, and, without irrigation, were practically valueless. And yet, it is contended, the means of irrigation were deliberately given up by the Indians and deliberately accepted by the government. The lands ceded were, it is true, also arid; and some argument may be urged, and is urged, that with their cession there was the cession of the waters, without which they would be valueless, and 'civilized communities could not be established thereon.' And this, it is further contended, the Indians knew, and yet made no reservation of the waters. We realize that there is a conflict of implications, but that which makes for the retention of the waters is of greater force than that which makes for their cession.'
77
The Court in Winters concluded that the Government, when it created that Indian Reservation, intended to deal fairly with the Indians by reserving for them the waters without which their lands would have been useless. Winters has been followed by this Court as recently as 1939 in United States v. Powers, 305 U.S. 527, 59 S.Ct. 344, 83 L.Ed. 330. We follow it now and agree that the United States did reserve the water rights for the Indians effective as of the time the Indian Reservations were created. This means, as the Master held, that these water rights, having vested before the Act became effective on June 25, 1929, are 'present perfected rights' and as such are entitled to priority under the Act.
78
We also agree with the Master's conclusion as to the quantity of water intended to be reserved. He found that the water was intended to satisfy the future as well as the present needs of the Indian Reservations and ruled that enough water was reserved to irrigate all the practicably irrigable acreage on the reservations. Arizona, on the other hand, contends that the quantity of water reserved should be measured by the Indians' 'reasonably foreseeable needs,' which, in fact, means by the number of Indians. How many Indians there will be and what their future needs will be can only be guessed. We have concluded, as did the Master, that the only feasible and fair way by which reserved water for the reservations can be measured is irrigable acreage. The various acreages of irrigable land which the Master found to be on the different reservations we find to be reasonable.
79
We disagree with the Master's decision to determine the disputed boundaries of the Colorado River Indian Reservation and the Fort Mohave Indian Reservation. We hold that it is unnecessary to resolve those disputes here. Should a dispute over title arise because of some future refusal by the Secretary to deliver water to either area, the dispute can be settled at that time.
80
The Master ruled that the principle underlying the reservation of water rights for Indian Reservations was equally applicable to other federal establishments such as National Recreation Areas and National Forests. We agree with the conclusions of the Master that the United States intended to reserve water sufficient for the future requirements of the Lake Mead National Recreation Area, the Havasu Lake National Wildlife Refuge, the Imperial National Wildlife Refuge and the Gila National Forest.
81
We reject the claim of the United States that it is entitled to the use, without charge against its consumption, of any waters that would have been wasted but for salvage by the Government on its wildlife preserves. Whatever the intrinsic merits of this claim, it is inconsistent with the Act's command that consumptive use shall be measured by diversions less returns to the river.
82
Finally, we note our agreement with the Master that all uses of mainstream water within a State are to be charged against that State's apportionment, which of course includes uses by the United States.
VI.
83
DECREE.
84
While we have in the main agreed with the Master, there are some places we have disagreed and some questions on which we have not ruled. Rather than adopt the Master's decree with amendments or append our own decree to this opinion, we will allow the parties, or any of them, if they wish, to submit before September 16, 1963, the form of decree to carry this opinion into effect, failing which the Court will prepare and enter an appropriate decree at the next Term of Court.
85
It is so ordered.
86
THE CHIEF JUSTICE took no part in the consideration or decision of this case.
87
(For opinion of Mr. Justice HARLAN, joined by Mr. Justice DOUGLAS and Mr. Justice STEWART, see 373 U.S. 603, 83 S.Ct. 1499.)
88
(For dissenting opinion of Mr. Justice DOUGLAS, see 373 U.S. 627, 83 S.Ct. 1511.)
APPENDIX
89
Mr. Justice HARLAN, whom Mr. Justice DOUGLAS and Mr. Justice STEWART join, dissenting in part.
90
I dissent from so much of the Court's opinion as holds that the Secretary of the Interior has been given authority by Congress to apportion, among and within the States of California, Arizona, and Nevada, the waters of the mainstream of the Colorado River below Lee Ferry. I also dissent from the holding that in times of shortage the Secretary has discretion to select or devise any 'reasonable method' he wishes for determining which users within these States are to bear the burden of that shortage. (In all other respects Mr. Justice STEWART and I—but not Mr. Justice DOUGLAS—agree with and join in the Court's opinion, though not without some misgivings regarding the amounts of water allocated to the Indian Reservations.)
91
In my view, it is the equitable principles established by the Court in interstate water-rights cases, as modified by the Colorado River Compact and the California limitation, that were intended by Congress to govern the apportionment of mainstream waters among the Lower Basin States, whether in surplus or in shortage. A fortiori, state law was intended to control apportionment among users within a single State.
I.
92
INTRODUCTION.
93
The Court's conclusions respecting the Secretary's apportionment powers, particularly those in times of shortage, result in a single appointed federal official being vested with absolute control, unrestrained by adequate standards, over the fate of a substantial segment of the life and economy of three States. Such restraint upon his actions as may follow from judicial review are, as well be shown, at best illusory. Today's result, I venture to say, would have dumbfounded those responsible for the legislation the Court construes, for nothing could have been farther from their minds or more inconsistent with their deeply felt convictions.
94
The Court professes to find this extraordinary delegation of power principally in § 5 of the Project Act, the provision authorizing the Secretary to enter into contracts for the storage and delivery of water. But § 5, as is more fully shown below, 83 S.Ct. pp. 615—621, infra, had no design resembling that which the Court now extracts from it. Rather, it was intended principally as a revenue measure, and the clause requiring a contract as a condition of delivery was inserted at the insistence not of the Lower but of the Upper Basin States in an effort to insure that nothing would disturb that basin's rights under the Colorado River Compact. There was no thought that § 5 would give authority to apportion water among the Lower Basin States. Indeed, during the hearings on the third Swing-Johnson bill when § 5 took its present form, one of its principal proponents, Delph Carpenter of Colorado, specifically stated that the proposed condition of a contract was intended to require
95
'that the persons who receive the water shall respect and do so under the compact. It has nothing to do with the interstate relations between Arizona and California.'1 (Emphasis added.)
96
And Representative Swing, coauthor of the bill, made virtually the same point in explaining the provision before the House Rules Committee:
97
'The act says (in § 5) 'The Secretary of the Interior is hereby authorized, under such general regulations as he may prescribe, to contract for the storage of water.' Whose water? It does not say. It might be a community like Imperial Valley that has already acquired a water right * * * or it may be someone who hereafter will acquire a water right, but that right will not be acquired under this bill; not from the United States Government. He will acquire his water right, if he acquires one, from the State and under the laws of the State, in which he puts the water to a beneficial use. There is nothing in this bill which puts the Government in conflict with the water laws of Arizona or Utah or any other State. As a matter of fact, the reclamation law is adopted by section 13 of this bill (now § 14), and section 8 of the reclamation act says that what the Government does must not be in conflict with the water laws of the States, so there can be no violence done State laws on this score.'2 (Emphasis added.)
98
The Court concedes, as indeed it must in the face of such unequivocal evidence, that this third Swing-Johnson bill, like its predecessors, established 'no method whatever of apportioning the waters among the States of the Lower Basin.' Ante, p. 560. This concession, one would think, would end this aspect of the controversy, since § 5 as ultimately adopted is virtually the same as that proposed in the third bill.3 Yet a method of federal apportionment is discovered in the fourth Swing-Johnson bill as finally enacted, a method which ends by delegating to the Secretary of the Interior the awesome power over the 'water' destiny of three States. To what provision does the Court attribute this startling metamorphosis? The fundamental change in approach is apparently found in § 4(a), which as adopted contains provisions (1) conditioning the effectiveness of the Act on seven-state ratification of the Colorado River Compact or alternatively on California's agreement to limit its annual consumption of Colorado River water, together with six-state ratification of the Compact; and (2) giving permission to California, Arizona, and Nevada to enter a further compact apportioning certain waters to the latter two States pursuant to a stated formula.
99
It is manifest that § 4(a), on which the Court so heavily relies, neither apportions the waters of the river nor vests power in any official to make such an apportionment. The first paragraph does not grant any water to anyone; it merely conditions the Act's effectiveness on seven-state ratification of the Compact or on six-state ratification, plus California's agreement to a limitation, i.e., a ceiling, on her appropriations. The source of authority to make such appropriations must be found elsewhere. And the second paragraph of § 4(a), suggesting a particular interstate agreement, similarly makes no apportionment of water among the States and delegates no power to any official to make such an apportionment. Indeed, it was accepted by the Senator from California (Mr. Johnson) only after the following colloquy with its proponent, Senator Pittman of Nevada:
100
'Mr. JOHNSON. * * * '(W)hat I want to make clear is that this amendment shall not be construed hereafter by any of the parties to it or any of the States as being the expression of the will or the demand or the request of the Congress of the United States.
101
'Mr. PITTMAN. Exactly, not.
102
'Mr. JOHNSON. Very well, then.
103
'Mr. PITTMAN. It is not the request of Congress.
104
'Mr. JOHNSON. I accept the amendment, then.' 70 Cong.Rec. 472.
105
Senator Johnson would surely have been surprised to learn that the formula which was not even 'the request of Congress' was in truth one which the Secretary was authorized to force down the throats of the States if they did not voluntarily agree to it.
106
Even this brief summary, I think, casts the gravest doubts upon the Court's construction of the Project Act as abolishing state law and accepted principles of equitable apportionment in effecting allocations of water among the States. A more detailed analysis will, I believe, demonstrate the incorrectness of the Court's conclusions on this score and will reveal the constitutional difficulties inherent in the uncontrolled delegation of power resulting from those conclusions.
II.
107
THE BACKGROUND OF THE BOULDER CANYON PROJECT ACT.
108
Judicial apportionment of interstate waters was established long before the Project Act as an effective means of resolving interstate water disputes. Kansas v. Colorado, 206 U.S. 46, 27 S.Ct. 655, 51 L.Ed. 956. Its acceptability had never been questioned. Priority of appropriation, the basic determinant of judicial apportionment as enunciated in Wyoming v. Colorado, 259 U.S. 419, 42 S.Ct. 552, 66 L.Ed. 999, was the law in six of the Colorado Basin States,4 and senior appropriations were respected in the seventh.5 The law of appropriation, which rests on the basic principle that a water right depends on beneficial use and which gives priority of right to the appropriator first in time, had been repeatedly declared to be indispensable to the development of the arid lands of the West.6
109
This backdrop of firm dedication to the principles of appropriation and of judicial apportionment is critical to an understanding of congressional purpose with respect to the Project Act. It is also critical to recognize that congressional compromise with these deeply respected principles was only partial; the problems facing Congress as a result of Wyoming v. Colorado were narrow. No Senator or Representative ever suggested that judicial apportionment was generally inappropriate; no Senator or Representative ever inveighed against the law of appropriation as such. The first problem was simply this: Interstate application of the doctrine of priority, unlimited by equitable considerations, threatened to deprive the four Upper Basin States of their fair share of the Colorado River because they were not so quick as California in development. The purpose of the Compact was simply to limit traditional doctrines to the extent necessary to avoid this extreme and harsh result, and to eliminate long and costly litigation.
110
It was perfectly plain that the Colorado River Compact merely guaranteed to the upper States a specified quantity of water immune from priorities below, subject to stated delivery requirements; it did nothing whatever to interfere with the law of priorities or the principles of equitable apportionment among the States of the Lower Basin.7 It was precisely because it did not that Arizona refused to approve either the Project Act or the Compact until something was done to safeguard her share of Lower Basin water.8 Similarly, the upper States feared that in the absence of ratification by Arizona, California would be free to appropriate all the Lower Basin's share under the Compact, and Arizona, not limited by that document, would be free to appropriate, as against the upper States, water the Compact sought to apportion to the Upper Basin.9
111
The remaining problem, therefore, was that California's acquisition of priorities as against Arizona and the upper States had to be further limited. A ceiling had to be put on her interstate appropriative priorities. Solution of this narrow problem likewise did not require complete abrogation of the principles of priority and interstate judicial apportionment.
112
Still another, and profoundly significant, factor in understanding the effect of the Project Act on the law of appropriation and judicial apportionment is the pervasive hostility that many westerners had to any form of federal control of water rights. Colorado's Delph Carpenter, who was as much responsible as any man for both the Compact and the contract requirement of § 5 of the Project Act, testified in 1925 to what he termed an insidious and calculated policy of the National Government, fostered particularly by the Departments of Interior and Justice, to encroach upon state prerogatives and supersede state authority with respect to the distribution of water. He made it clear, as did Wyoming's Senator Kendrick, that he deemed this policy oppressive, destructive, and deplorable.10 Utah's Senator King made the same objection on the floor of the Senate. 69 Cong.Rec. 10262. When it was suggested that Congress might legislate to meet the problem of California's threatened pre-emption of the river, a storm of doubt arose as to its constitutional power to do so. Upper Basin and Arizona spokesmen those who were to be benefited by limiting appropriations repeatedly insisted that the only constitutional ways of apportioning the river were by suit in this Court or by interstate compact.11 And Senator Bratton of New Mexico, hardly an opponent of the Project Act, objected that by merely suggesting in § 4(a) the terms of a compact which the States were free to modify or to reject, Congress was infringing upon state sovereignty. 70 Cong.Rec. 470—471.
113
Congress' entire approach to the problems of prior appropriation was governed by this deep-seated hostility to federal dictation of water rights. When plans for development of the Lower Basin threatened the rights of the upper States, they did not seek the simple (and in my view constitutionally unobjectionable) solution of a legislative apportionment. They employed instead the cumbersome method of interstate compact, which required authorization by Congress and by seven state legislatures prior to negotiation and ratification by the same eight bodies thereafter. When it began to appear that Arizona would not ratify the Compact, Congress still did not legislate a general apportionment. It built the statute around the provisions of the Compact, insisting on ratification by as many States as possible, even at the cost of further delaying the already overdue Project Act. It simply conditioned the use of government property and of water stored behind the dam on compliance with the Compact. Attempts to divide the Lower Basin water by interstate agreement continued through the Denver Conference called by the Upper Basin Governors in the summer of 1927—nearly five years after negotiation of the Compact. Yet it was not until 1927 that an amendment was first offered to protect Arizona by a statutory limitation on California's consumption, and it was not until 1928 that the proposal was adopted into the bill.12
114
Finally, when Congress ultimately resigned itself to the necessity of legislating in some way with respect to the division of Lower Basin waters, it used narrow words suitable to its narrow purpose and to its regard both for the system of judicial apportionment and appropriation and for the rights of the States. Even then Congress did not attempt to legislate an apportionment of Lower Basin water; it simply prescribed a ceiling for California. In the words of Senator Johnson, 'We write, then, that California shall use perpetually only a specific amount of water, naming the maximum amount which may be used.' 69 Cong.Rec. 7250. Even this, Congress was unwilling to do directly. As exported from committee, the bill contained a provision directing the Secretary of the Interior to limit California's consumption in the exercise of his power of contract.13 But this was replaced by the present provision, which reached the same result not via the Secretary's contract authority but by the awkward device of requiring California's legislature to consent to the limitation as a condition precedent to the effectiveness of the Project Act. And this was not all; to end the tale Congress added to § 4(a) specific authorization to Arizona, California, and Nevada to enter into an agreement to complete the division of the Lower Basin water—the same cumbersome substitute for direct congressional apportionment that had been abortively mooted for six years.
115
This history bears recapitulation. First, the law of appropriation, basic to western water law, was greatly respected, and the solution of interstate water disputes by judicial apportionment in this Court was well established and accepted. Second, the problems created by these doctrines as applied in Wyoming v. Colorado were narrow ones, not requiring for their solution complete abrogation of well-tried principles; existing law was quite adequate to deal with all questions save those Congress expressly solved by imposing a ceiling on California. Third, Congress throughout the dispute exhibited great reluctance to interfere with the division of water by legislation, because of a deep and fundamental mistrust of federal intervention and a profound regard for state sovereignty, shared by many influential members. Finally, when Congress was forced to legislate with respect to this problem or face defeat of the entire Project Act, it chose narrow terms appropriate to the narrow problem before it, and even then acted only indirectly to require California's consent to limiting her consumption.
116
It is inconceivable that such a Congress intended that the sweeping federal power which it declined to exercise—a power even the most avid partisans of national authority might hesitate to grant to a single administrator—be exercised at the unbridled discretion of an administrative officer, especially in the light of complaints registered about 'bureaucratic' and 'oppressive' interference of the Department which that very officer headed.14 It is utterly incredible that a Congress unwilling because of concern for States' rights even to limit California's maximum consumption to 4,400,000 acre-feet without the consent of her legislature intended to give the Secretary of the Interior authority without California's consent to reduce her share even below that quantity in a shortage.
III.
117
THE AUTHORITY OF THE SECRETARY UNDER SECTION 5 OF THE PROJECT ACT.
118
The Court holds that § 5 of the Project Act, which empowers the Secretary to contract for water delivery and forbids delivery of stored water without a contract displaces the law of apportionment among the Lower Basin States, giving the Secretary power to divide the water by contract and to distribute the burden of shortages, without respecting appropriations.
119
But it does not follow that because no user is entitled to stored water without a contract the Secretary may award or withhold contracts independently of priorities. In fact, § 5 reflects no such intention. The Secretary's power to contract upon appropriate financial charges for water delivery, not included in the early bills, was added during the 1926 hearings in response to a request from Secretary of the Interior Work that users of water, as well as of power, be made to bear the cost of the project.15 At the same time § 4(b) for the first time provided that no work under the Act should begin until these revenues were assured by the Secretary's contracts. There was yet no provision prohibiting deliveries without contracts.16
120
Thus originally purely a financial tool, the contract power was later made to serve the additional purpose of enforcing the Compact's provisions against Arizona in the absence of her ratification. At the urging of the upper States § 8 had been amended to subject the United States in operating the dam to the Compact, to condition the enjoyment of the dam's benefits on compliance with the Compact, and to require that contracts from the United States should so provide.17 The upper States then insisted on inserting the requirement in § 5 that no one was to receive stored water without a contract, expressly and solely for the purpose of tying the Compact's enforcement to the contract power.18 There was no intent to confer absolute power to grant or withhold. Indeed, to give effect to priorities in time of shortage, up to the maximum quantities permitted California by § 4(a), tends to promote the stability of water uses, a policy Congress sought to further in § 5 itself by requiring that contracts be for permanent service. In short, disregard of appropriations in one State in favor of those in another except as required by the inter-basin apportionment of the Compact or by the California limitation, was no part of the purpose of this section; it was designed to insure revenue and to enforce the Compact and the California limitation.19
121
When the provision for water delivery contracts was first inserted in the Swing bill in 1926, it prescribed that 'Contracts respecting water for domestic uses may be for permanent service but subject to rights of prior appropriators.'20 Proponents of the bill later altered this provision to apply to irrigation contracts as well as to require, rather than simply to permit, that contracts be for permanent service.21 At the request of the upper States, the phrase 'subject to rights of prior appropriators' was deleted.22 The Court concludes from this bit of history that Congress considered but rejected the suggestion that the law of appropriation govern the distribution of water stored in Lake Mead. But deletion or rejection of a proposed amendment is not strong evidence of legislative intention; the reasons for deletion may be any of a great number, not the least frequent of which is that the suggestion is redundant. Here it seems clear that there was a further reason for the change. The phrase was dropped at the same time the provision requiring each user to have a contract was added. Under the bill as it stood prior to this no contract was required, and new contracts were made junior to all prior appropriators, even those initiating or perfecting rights only after the statute became effective. As amended the bill required a contract of every user of stored waters, and the deleted clause was no longer in accord with the contractual plan. It is surely stretching things to suggest that deletion of this no longer accurate language signifies that the Secretary may award contracts on his own authority, without regard for priorities that would obtain under state law.
122
In support of its construction of § 5 the Court relies in large part upon an exchange between Senator Johnson and Senator Walsh of Montana. 70 Cong.Rec. 168. The only thing this colloquy seems to make clear is that Senator Johnson had not comprehensively analyzed the relationship between § 5 and the law of appropriation. First he thought the Secretary would be required to deliver water to those who had appropriated it; then he said this would be required '(i)f they contract'; then he agreed the Secretary might withhold water 'as he sees fit'; then he 'doubt(ed) very much' whether the Secretary could disregard Los Angeles' appropriations; finally he said 'possibly' the Secretary might utterly ignore appropriations. This shifting dialogue can scarcely be deemed an authoritative, or even useful, aid to construction of the statute.
123
Nor is there warrant for the Court's reliance on the statements of such opponents of the bill as Utah's Representative Colton and Arizona's Representative Douglas. Objections of opponents of a bill are seldom significant guides to its construction. See Schwegmann Bros. v. Calvert Distillers Corp., 341 U.S. 384, 394—395, 71 S.Ct. 745, 750—751, 95 L.Ed. 1035, 19 A.L.R.2d 1119. And in any event in this instance the opponents themselves were far from consistent in their views.23
124
Of far greater significance are the statements of the bill's supporters, which confirm that no power to ignore appropriations was given to the Secretary.24 Representative Swing, author of the bill, responded to Mr. Hayden's assertion that such a power was given with an emphatic denial: 'the distribution will either be by agreement between the States or under their respective laws.' House Hearings, supra, note 1, at 32. The following year he explained that the United States would not dispose of water rights under the bill; it would merely store water belonging to persons acquiring their rights under state law. See p. 604-605, supra. In 1928, defending the House bill against an Arizona witness' charge that California might appropriate the entire Lower Basin supply, Mr. Swing did not dispute the statement as to California's rights but reinforced it by declaring that Arizona was free to make appropriations too. Hearings before House Committee on Irrigation and Reclamation on H.R. 5773, 70th Cong., 1st Sess. 57—58. He later assured the House that notwithstanding the bill Arizona 'still has the benefit of the law prior to appropriation, and she still has the right to the beneficial use of any of the water she is able to put to use.' 69 Cong.Rec. 9781. Delph Carpenter, proponent of the § 5 contract requirement, said that it was designed to burden storage water with the Compact, and thus to protect the Upper Basin, and that '(i)t has nothing to do with the interstate relations between Arizona and California.'25 Senator Johnson, sponsor of the Senate bill, told the Senate the bill was made a part of the reclamation law, which 'specifically protects each State in its water rights and in the rights of the citizens of those States to water.' 68 Cong.Rec. 4292. Senator Pittman insisted there was nothing in the bill (prior to the California limitation) to prevent either Arizona or California from appropriating all the water she could use.26 Senator Phipps, whose amendment became the California limitation, declared that any dispute over the relative rights of Arizona and of Los Angeles would be resolved by the Secretary in accordance with priority of appropriation and the normal preference for domestic over agricultural use.27
125
Of further weight in supporting the view that Congress did not construe § 5 to destroy the law of appropriation and apportionment is the fact that the entire controversy over the California limitation took place after § 5 was added to the bill. Utah was to certain that Arizona remained free to appropriate water despite § 5 that she repealed her ratification of the six-state Compact thereafter.28 While the original committee amendment to the Act would have required the Secretary to limit California's appropriations, the debates evidence no conviction that the Secretary had even a permissive authority to do so by virtue of the unamended § 5.
IV.
126
THE BEARING OF OTHER PROVISIONS OF THE PROJECT ACT.
127
Nothing in the Project Act expressly gives the Secretary power to ignore appropriations so long as financial conditions are met and the Compact and limitations are observed. Senators Hayden and Pittman, as the Court notes, did indicate that § 4(a) provided for an apportionment of the water, although even they did not suggest that § 4(a) gave any authority to the Secretary to make an apportionment by his contracts or to allocate the burdens in time of shortage. But in any event, as already noted, p. 606-607, supra, § 4 does not by its terms make an apportionment; rather it simply requires six-state ratification of the Compact and an agreement by California to limit her share as conditions on the effectiveness of the Act, and authorizes an apportionment by the States themselves. In the words of Senator Johnson, the provision
128
'* * * does not divide the water between Arizona and California. It fixes a maximum amount beyond which California can not go.' 70 Cong.Rec. 385.
129
Nor does § 6, which requires that the dam be operated for the satisfaction of 'present perfected rights' among other purposes, indicate by negative implication that the Secretary may ignore all other appropriations. This provision was drafted by the Upper Basin States in order to insure that the condition of the Compact had been met to relieve them from the claims of perfected users below.29 That condition was the construction of an adequate storage reservoir against such those claims could be asserted; the Compact has nothing to do with whether rights perfected under state law since 1929 may be ignored by the Secretary in awarding contracts. Section 8(b), which subjects the United States and all users of the Project to any compact allocating among the Lower Basin States 'the benefits, including power, arising from the use of water accruing to said States,' and which subjects such an agreement, if made after January 1, 1929, to any delivery contracts made prior to its approval, is similarly no authority for the Court's conclusion. Legislative history is virtually silent as to the reason for giving such contracts precedence, but the provision seems simply to have been intended to promote the entering of contracts by insuring their permanence in accordance with the requirement of § 5.30 There is no indication in § 8(b) whether or not the Secretary is free in awarding contracts to ignore existing appropriations; it merely evidences a policy that rights so perfected as to have been reduced to a contract for delivery at a consideration, whatever the basis on which they should be awarded, ought not to be destroyed by a subsequent interstate agreement.
130
If the statute were completely silent as to whether the Secretary may disregard appropriations, the normal inference would be that Congress did not mean to displace existing law. Enough has been said of the statute's history to buttress this inference beyond question. Moreover, the statute is by no means silent on this matter. The references in § 8(a) and (b) to 'appropriators' of water stored or delivered by the Project, and in § 4(a) to the taking of steps 'to initiate or perfect any claims to the use of water' made available by the dam, are only the least evidence.31 Section 14 provides that the Reclamation Act shall govern the operation of Hoover Dam except as the Project Act otherwise provides. Section 8 of the Reclamation Act, 32 Stat. 390, 43 U.S.C. § 383, directs the Secretary of the Interior in carrying out his duties under the Act to proceed in accordance with state and territorial laws and declares that nothing in the federal act 'shall in any way affect any right of any State or of the Federal Government or of any landowner, appropriator, or user of water in, to, or from any interstate stream or the waters thereof.'
131
Both Representative Swing and Senator Johnson emphasized that this provision was deliberately incorporated into the Project Act to safeguard from federal destruction the rights of the States to their shares of the water.32 This Court made clear in Wyoming v. Colorado, 259 U.S. 419, 463, 42 S.Ct. 552, 557, 66 L.Ed. 999, that by thus protecting the rights of any State in an interstate stream Congress intended to leave untouched the law of interstate equitable apportionment. Ivanhoe Irrig. Dist. v. McCracken, 357 U.S. 275, 291, 78 S.Ct. 1174, 1183, 2 L.Ed.2d 1313, despite its dictum that § 8 applies only to the acquisition of rights by the United States and not to its operation of a dam, holds only that the clear command of § 5 of the Reclamation Act, 32 Stat. 389, 43 U.S.C. § 431—that water deliveries to each user not exceed the quantity required for 160 acres—prevails over state law, not that state law does not generally govern priorities in the use of water from federal reclamation projects under § 8.33 The Court in Ivanhoe expressly stated that it was reaching its narrow conclusion:
132
'(w)ithout passing generally on the coverage of § 8 in the delicate area of federal-state relations in the irrigation field * * *.' 357 U.S., at 292, 78 S.Ct. at 1184.
133
This general question, with reference to what is undoubtedly the most important single water project in the United States, is precisely the question before us today. In view of the language of the Project Act, as well as its background and legislative history, there can, I think, be no doubt of the answer.
V.
134
THE LACK OF STANDARDS DEFINING THE LIMITS OF THE SECRETARY'S POWER.
135
The Secretary, the Court holds, has already apportioned the waters of the mainstream by his contracts with Arizona and Nevada and has done so in accordance with the formula suggested as a basis for an interstate agreement in § 4(a). This holding may come as a surprise to those responsible for a statement such as that in the Arizona contract, which provides that its terms are
136
'* * * without prejudice to, any of the respective contentions of said states and water users as to * * * (5) what limitations on use, rights of use, and relative priorities exist as to the waters of the Colorado River system * * *.'
137
But whether the quantum of the Secretary's apportionment was intentional or inadvertent, the Court holds that such an apportionment has been made, and the relevant question for the future is the one that is perhaps primarily responsible for this litigation: How is the burden of any shortage to be borne by the Lower Basin States? This question is not decided; the Court simply states that the initial determination is for the Secretary to make.
138
What yardsticks has Congress laid down for him to follow? There is, it is true, a duty imposed on the Secretary under § 6 to satisfy 'present perfected rights,' and if these rights are defined as those perfected on or before the effective date of the Act, it has been estimated that California's share amounts to approximately 3,000,000 acre-feet annually. This, then, would be the floor provided by the Act for California, assuming enough water is available to satisfy such present perfected rights. And the Act also has provided a ceiling for California: the 4,400,000 acre-feet of water (plus one-half of surplus) described in § 4(a).
139
But what of that wide area between these two outer limits? Here, when we look for the standards defining the Secretary's authority, we find nothing.34 Under the Court's construction of the Act, in other words, Congress has made a gift to the Secretary of almost 1,500,000 acre-feet of water a year, to allocate virtually as he pleases in the event of any shortage preventing the fulfillment of all of his delivery commitments.
140
The delegation of such unrestrained authority to an executive official raises, to say the least, the gravest constitutional doubts. See Schechter Poultry Corp. v. United States, 295 U.S. 495, 55 S.Ct. 837, 79 L.Ed. 1570, 97 A.L.R. 947; Panama Refining Co. v. Ryan, 293 U.S. 388, 55 S.Ct. 241, 79 L.Ed. 446; cf. Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 587—589, 72 S.Ct. 863, 866—867, 96 L.Ed. 1153, 26 A.L.R.2d 1378. The principle that authority granted by the legislature must be limited by adequate standards serves two primary functions vital to preserving the separation of powers required by the Constitution.35 First, it insures that the fundamental policy decisions in our society will be made not by an appointed official but by the body immediately responsible to the people. Second, it prevents judicial review from becoming merely an exercise at large by providing the courts with some measure against which to judge the official action that has been challenged.
141
The absence of standards under the Court's construction is an instructive illustration of these points. The unrestrained power to determine the burden of shortages is the power to make a political decision of the highest order. Indeed, the political pressures that will doubtless be brought to bear on the Secretary as a result of this decision are disturbing to contemplate. Furthermore, whatever the Secretary decides to do, this Court will surely be unable effectively to review his actions, since it will not know what guides were intended by Congress to govern those actions.
142
These substantial constitutional doubts do not, of course, lead to the conclusion that the Project Act must be held invalid. Rather, they buttress the conviction, already firmly grounded in the Act and its history, that no such authority was vested in the Secretary by Congress. Its purpose instead was to leave these matters to state law, and developed principles of equitable apportionment, subject only to the explicit exceptions provided in the Act.
143
For these reasons I respectfully dissent from the construction which the Court puts upon this aspect of the Act.
144
Mr. Justice DOUGLAS, dissenting.
I.
145
This case, I think, has been haunted by several irrelevancies. First, is the fact that the only points from which California can take the water of the Colorado River System are on the mainstream above Laguna Dam, there being no tributaries in that State. This fact, I think, leads the Court to the inference that the tributaries which come in below Laguna Dam contain waters to which California has no rights. The controversy does concern the waters of the lower tributaries, but only indirectly. California does not seek those waters. She merely seeks to have them taken into consideration in the formula that determines the allocation between her and Arizona.
146
Another irrelevancy is the fact that only 2 1/2% of the Colorado River drainage basin is in California although 90% of the water which California appropriates leaves the basin never to return. If we were dealing with problems of equitable apportionment, as we were in Nebraska v. Wyoming, 325 U.S. 589, 65 S.Ct. 1332, 89 L.Ed. 1815, that factor would be relevant to our problem. And it would be relevant in case we were dealing with litigation concerning waters in excess of the amount granted California under the Project Act. But it is irrelevant here because the only justiciable question that involves the volume of water is one that concerns the source of supply out of which California's 4,400,000 acre-feet will be satisfied—a matter which I think Congress resolved differently than has the Court.
147
Third, is a mood about the controversy that suggests that here, as in the cases involving multipurpose federal dams, federal control of navigable streams controls this litigation. The right of the Federal Government to the flow of the stream is not an issue here. We deal with a very unique feature of the irrigation laws of the 17 Western States.
148
The question is not what Congress has authority to do, but rather the kind of regime under which Congress has built this and other irrigation systems in the West. Heretofore those regimes have been posited on the theory that state law determines the allotment of waters coming through the irrigation canals that are fed by the federal dams.
149
Much is written these days about judicial lawmaking; and every scholar knows that judges who construe statutes must of necessity legislate interstitially, to paraphrase Mr. Justice Cardozo. Selected Writings (1947 Hall ed.), p. 160. The present case is different. It will, I think, be marked as the baldest attempt by judges in modern times to spin their own philosophy into the fabric of the law, in derogation of the will of the legislature. The present decision, as Mr. Justice HARLAN shows, grants the federal bureaucracy a power and command over water rights in the 17 Western States that it never has had, that it always wanted, that it could never persuade Congress to grant, and that this Court up to now has consistently refused to recognize. Our rulings heretofore have been consistent with the principles of reclamation law established by Congress both in nonnavigable streams (Ickes v. Fox, 300 U.S. 82, 94—96, 57 S.Ct. 412, 416—417, 81 L.Ed. 525) and in navigable ones. Nebraska v. Wyoming, 325 U.S. 589, 612, 65 S.Ct. 1332, 1348, 89 L.Ed. 1815. The rights of the United States as storer of waters in western projects have been distinctly understood to be simply that of 'a carrier and distributor of the water.' Ickes v. Fox, Supra, 300 U.S., p. 95, 57 S.Ct. p. 417. As we stated in Nebraska v. Wyoming, supra, 325 U.S. p. 614, 65 S.Ct. p. 1349:
150
'The property right in the water right is separate and distinct from the property right in the reservoirs, ditches or canals. The water right is appurtenant to the land, the owner of which is the appropriator. The water right is acquired by perfecting an appropriation, i.e., by an actual diversion followed by an application within a reasonable time of the water to a beneficial use.'
151
And that result was reached even though under those other projects, as under the present one, the Secretary had broad powers to make contracts governing the use and disposition of the stored water. See, e.g., 43 U.S.C. §§ 389, 440.
152
The men who wrote the Project Act were familiar with western water law. Wyoming v. Colorado, 259 U.S. 419, 42 S.Ct. 552, 66 L.Ed. 999, had recently been decided, holding that priority of appropriation was the determining factor in reaching an equitable apportionment between two Western States. Id., 259 U.S. at 470, 42 S.Ct. at 559. Yet, S.Rep.No. 654, 69th Cong., 1st Sess. 26—27, contains no suggestion that Congress, by § 5, was displacing a doctrine as important to these Western States as the doctrine of seizin has been to the development of Anglo-American property law. Instead, only 25 lines of that report are devoted to § 5, and those lines clearly support Mr. Justice HARLAN's conclusion that the section was designed primarily as a financial tool.
153
The principle that water priorities are governed by state law is deep-seated in western reclamation law. In spite of the express command of § 14 of the Project Act, which makes the system of appropriation under state law determine who has the priorities, the Secretary of the Interior is given the right to determine the priorities by administrative fiat. Now one can receive his priority because he is the most worthy Democrat or Republican, as the case may be.
154
The decision today, resulting in the confusion between the problem of priority of water rights and the public power problem, has made the dream of the federal bureaucracy come true by granting it, for the first time, the life-and-death power of dispensation of water rights long administered according to state law.
II.
155
At issue on the other main phase of the case is the meaning of the California limitation contained in § 4(a) of the Project Act. The Court, however, does not use the present litigation as an occasion to determine Arizona's and California's rights under that Act, but as a vehicle for making a wholly new apportionment of the waters in the Lower Basin and turning over all unresolved problems to the Secretary of the Interior. The Court accomplishes this by distorting both the history and language of the Project Act.
156
The Court relies heavily on the terms and history of a proposed tri-state compact, authorized by § 4(a) but never adopted by the States concerned, viz., Arizona, California and Nevada. The proposed tri-state compact provided for a division of tributary waters identical to that made by the Court, insofar as the Gila is awarded to Arizona. The Court is reality enforces its interpretation of the proposed tri-state compact and imposes its terms upon California.
157
The Court, however, cannot find in the proposed tri-state compact (the one that was never approved) an allocation of the tributaries other than the Gila; and in order to justify their allocation to Arizona it is forced to turn to the terms of 'proposals and counterproposals over the years,' instead of to the language of the Project Act. The result is the Court's not that of Congress, whose intent we have been called upon to discover and effectuate. The congressional intent is expressed in § 4(a), which provides that California shall be limited to the use of 4,400,000 acre-feet 'of the waters apportioned to the lower basin States by paragraph (a) of Article III of the Colorado River compact' (the compact that was approved) and to not more than half of 'any excess or surplus waters unapportioned by said compact.'1 These waters are defined in the Colorado River Compact as system waters, and not as waters in the mainstream. Yet the Court restricts California to mainstream waters. That is the essence of the difference between us.
III.
158
As I read the Colorado River Compact and § 4(a) of the Project Act, California is entitled to add all uses of system waters by Lower Basin States in the tributaries to those waters available in the mainstream to determine (1) how much water she can take out of the first 7,500,000 acre-feet apportioned to the Lower Basin States by Article III(a), and (2) whether there are excess or surplus system waters, including Article III(b) waters, of which California has a right to no more than one-half.
159
I disagree with the Court's conclusion that § 4(a) of the Project Act refers only to the water flowing in the mainstream below Lee Ferry. The Project Act speaks clearly, and only, in terms of the waters apportioned to the Lower Basin States by Article III(a) of the Compact, viz., California may take no more than 4,400,000 acre-feet 'of the waters apportioned to the lower basin States by paragraph (a) of Article III of the Colorado River compact.' Article III(a) of the Compact apportions 'from the Colorado River System in perpetuity to the Upper Basin and to the Lower Basin, respectively, the exclusive beneficial consumptive use of 7,500,000 acre-feet of water per annum.' The term 'Colorado River System' is defined in Article II(a) as including the entire mainstream and the tributaries.2
160
There is, moreover, not a word in Senate Report No. 592, 70th Cong., 1st Sess., reporting the Project Act, that indicates, suggests, or implies that the Colorado River is to be divided and California or any other Lower Basin State restricted to mainstream water. The Report indeed speaks of 'enthroning the Colorado River compact' (id., p. 16), which embraces the entire river system in the United States, not just the mainstream. See Article II(a). Arizona's fears that California would take 5,400,000 acre-feet from the first 7,500,000 acre-feet, if the entire system were used as the source, are, I think, unfounded. Out of the first 7,500,000 acre-feet of system water, California would be entitled only to 4,400,000 acre-feet. Out of the balance or 3,100,000 acre-feet, California would be excluded.
161
How much of this 3,100,000 acre-feet should go to Arizona and how much to Nevada, New Mexico, and Utah cannot be determined on this record, the relevant findings not being made in light of the construction which has been given to the Project Act, the Compact, and the Limitation Act. We cannot take as a guide the provisions in the second paragraph of § 4(a) of the Project Act, viz., the 300,000 acre-feet proposed for Nevada and the 2,800,000 acre-feet proposed for Arizona, because those provisions come into play only if Arizona, California, and Nevada enter a compact, which to date they have not done. The division of 3,100,000 acre-feet should, I think, be made among Arizona, Nevada, New Mexico, and Utah pursuant to the principles of equitable apportionment. Nebraska v. Wyoming, 325 U.S. 589, 65 S.Ct. 1332, 89 L.Ed. 1815.
162
The evidence is clear that the dependable Lower Basin supply does not exceed 8,000,000 acre-feet if the river system is taken as a whole. By Article III(b) of the Compact the Lower Basin States can increase their beneficial use by 1,000,000 acre-feet, if additional water is available. By § 4(a) of the Project Act California is entitled to not more than one-half of any excess that is 'unapportioned by said compact.' The amount apportioned to the Lower Basin States by the Compact is 8,500,000 acre-feet, viz., Article III(a) waters in the amount of 7,500,000 'in perpetuity' plus Article III(b) waters, which are highly contingent. After the Upper Basin is given its 7,500,000 acre-feet, the 'unapportioned' excess described in Article III(b) (b) would be available. As noted, the present permanent supply for the Lower Basin would not exceed 8,000,000 acre-feet from the mainstream and the tributaries. As I read the Compact and the Project Act, California would get out of the 8,000,000 acre-feet 4,400,000 acre-feet plus not more than one-half of Article III(b) waters, which, under the foregoing assumption, would amount to one-half of 500,000 acre-feet. If there is a further surplus (either in the sense of Article III(b) or in the more remote sense in which § 4(a) of the Project Act uses that word),3 the division between the Lower Basin States should follow the principles of equitable apportionment which we applied in Nebraska v. Wyoming, 325 U.S. 589, 65 S.Ct. 1332, 89 L.Ed. 1815. If § 4(a) is to be read as referring to system waters, California's total rights in available Lower Basin waters would amount to not more than 4,650,000 acre-feet annually (4,400,000 plus 250,000). She would also have a right, albeit highly contingent, to any additional Article III(b) waters that become available to the Lower Basin and to such share of the waters in both Basins over 16,000,000 acre-feet (7,500,000 to Upper Basin, 7,500,000 to Lower Basin under Article III(a), plus 1,000,000 to Lower Basin under Article III(b)) as is equitable. Nebraska v. Wyoming, supra.
163
Under the Court's reading of § 4(a), however, a far different division is made. The Court says that the language of § 4(a) limiting California to 4,400,000 acre-feet 'of the waters apportioned to the lower basin States by paragraph (a) of Article III of the Colorado River compact' (7,500,000 acre-feet per annum) is just a 'shorthand' way of saying that California is limited to 4,400,000 acre-feet of the water available in the mainstream. According to the Court, California has no rights in system waters, as this would include rights in the tributaries, and the Court has decided that the tributaries belong exclusively to Arizona. Thus, if California is to obtain any 'excess or surplus' waters, the surplus must be flowing in the mainstream. That is, California can assert her right to 'surplus' waters only when the flow of the mainstream is more than 7,500,000 acre-feet per year. But if, as the evidence shows, the dependable Lower Basin supply of system waters is only 8,000,000 acre-feet per annum, 2,000,000 of which are in the tributaries, California can look only to 6,000,000 acre-feet in the mainstream. Thus, California will never be entitled to any of the additional Article III(b) waters (500,000 acre-feet) in the Lower Basin system. Those 'surplus' waters would necessarily be in the tributaries, and under the Court's interpretation they belong exclusively to Arizona, § 4(a) to the contrary notwithstanding.
164
As a practical matter, the only place California can get system waters is from the mainstream, there being no tributaries of the Colorado River in California. The question to be decided is whether or not under § 4(a) of the Project Act California can take into consideration Arizona's uses on her tributaries in determining her (California's) right to divert water from the mainstream. The Court says California cannot, because when the Project Act refers to her rights in system waters as the measuring rod, it really means her rights in mainstream waters. With due respect, the majority achieves that result by misreading the Colorado River Compact, the Project Act, and by misreading the legislative history leading up to the California Limitation Act. An analysis of the legislative history will show, as already noted, that the Court's analysis is built mainly upon statement made by the various Senators in arguing the terms of a proposed tristate compact that was never made.
IV.
165
The Project Act needs the Compact to achieve a settlement of the issue of the apportionment of water involved in this case. It is argued that an apportionment, constitutionally, can be achieved only in one of two ways—by an interstate compact or by a decree of equitable apportionment. That proposition need not, however, be resolved here, because (apart from a contingency not relevant here) the Project Act by the express terms of § 4(a) is dependent on the ratification of the Compact.4 If the Compact is ratified, it and the Project Act are to supply the measure of waters which California may claim.5
166
The overall accounting of the waters is provided for in Article III of the Compact. By Article III(a) 'the exclusive beneficial consumptive use of 7,500,000 acre-feet of water per annum' is apportioned 'in perpetuity to the Upper Basin and to the Lower Basin, respectively,' meaning that each basin gets 7,500,000 acre-feet. By Article III(b) the Lower Basin is given the right to increase its beneficial consumptive use by 1,000,000 acre-feet per annum. By Article III(c) any deficiency owed Mexico 'shall be equally borne by the Upper Basin and the Lower Basin.' The Lower Basin by definition includes California. Article II(g). Tributary uses in Arizona diminish California's right under Article III(c) to require the Upper Basin States to supply water to satisfy Mexico. California is to be charged with water from the Gila when the accounting is made with Mexico. That is, California is presumed to enjoy the waters from the Lower Basin tributaries for purposes of Article III(c) of the Compact. It is manifestly unfair to charge her with those waters under Article III(c) of the Compact and to say that she is entitled to none of them in computing the 4,400,000 acre-feet which the Limitation Act and the Project Act give her out of the waters of Article III(a) of the Compact.
167
Section 1 of the Project Act authorizes the Secretary of the Interior to construct and operate the Boulder Dam 'subject to the terms of the Colorado River compact.' By § 4(a) the Project Act is not to be operative unless and until the seven States 'shall have ratified the Colorado River compact'; and if they do not, then 'the provisions of the first paragraph of Article XI of said compact' must be waived. Moreover, the 4,400,000 acre-feet allotted to California by § 4(a) are described in terms 'of the waters apportioned to the lower basin States by paragraph (a) of Article III of the Colorado River compact.' Section 4(a) describes the 'excess or surplus' waters in terms of those 'unapportioned by said compact'; and it makes all 'uses always to be subject to the terms of said compact.' The compact is, indeed, the underpinning of the Project Act.
168
The Compact apportions the waters 'from the Colorado River System,' which by definition includes the mainstream and its tributaries in the United States. And California's Limitation Act, containing the precise language of the allocation of waters in § 4(a) of the Project Act, describes the 4,400,000 acre-feet in terms 'of the waters apportioned to the lower basin States by paragraph (a) of Article III of the Colorado river compact.'6
169
So it seems that the Compact is the mainspring from which all rights flow. The 7,500,000 acre-feet of water apportioned by Article III(a) of the Compact 'from the Colorado River System' to the Lower Basin is the supply out of which California's 4,400,000 acre-feet is to be taken.
170
To repeat, the words 'excess or surplus waters unapportioned by said compact,' as used in § 4(a) of the Project Act, mean, in my view, all waters available in the Lower Basin in excess of the first 7,500,000 acre-feet covered by Article III(a) of the Compact.7
171
The additional 1,000,000 acre-feet described in Article III(b) was added to the Compact 'to compensate for the waters of the Gila River and its tributaries being included within the definition of the Colorado River System.' Arizona v. California, 292 U.S. 341, 350—351, 54 S.Ct. 735, 739, 78 L.Ed. 1298. And though Arizona has long claimed those 1,000,000 acre-feet as hers, that construction of Article III(b) of the Compact was rejected long ago. Arizona v. California, supra, 292 U.S. p. 358, 54 S.Ct. p. 742.
V.
172
While the legislative history of the California limitation contained in § 4(a) looks several ways, much of it is legislative history made with a view to its favorable use in the future—a situation we have noticed on other occasions. See Schwegmann Bros. v. Calvert Corp., 341 U.S. 384, 71 S.Ct. 745, 95 L.Ed. 1035, 19 A.L.R.2d 1119. I think an objective reading of that history shows that the tristate compact authorized by § 4(a) of the Project Act (a compact never made) was the one and only way visualized by that Act through which Arizona could get the exclusive use of the waters of the Gila River. For the second paragraph of § 4(a) of the Project Act states that the tristate compact, if made, shall give Arizona 'the exclusive beneficial consumptive use of the Gila River and its tributaries' within the boundaries of Arizona. Fears that this appropriation would injure New Mexico are not relevant to our problem, since the proposed tri-state compact would not hurt New Mexico unless she agreed to it. The legal rights of States not parties to the Compact would be unimpaired, as Arizona v. California, 283 U.S. 423, 462, 51 S.Ct. 522, 529, 75 L.Ed. 1154, holds. The same applies to any concern that Upper Basin rights would be imperiled by the tri-state compact.
173
After much discussion, the amendment allocating 4,400,000 acre-feet to California by § 4(a) of the Project Act was finalized by Senator Phipps, Chairman of the Committee on Irrigation and Reclamation, who identified those 4,400,000 acre-feet as system waters. He made it unmistakably clear by adding to § 4(a) the words 'by paragraph (a) of Article III' of the Compact which in his words 'show that that allocation of water refers directly to the seven and one-half million acre-feet of water' described by Article III(a) of the Compact. 70 Cong.Rec. 459. That amendment was agreed to without a roll call. 70 Cong.Rec. 473. Prior to that time Senator Phipps had proposed that California receive 4,600,000 acre-feet. Id., p. 335.
The following colloquy took place:
174
'MR. HAYDEN. Under the circumstances I should like to inquire of the Senator from Colorado how he arrives at the figure 4,600,000 acre-feet of water instead of 4,200,000 acre-feet as proposed in my amendment?
175
'Mr. PHIPPS. It was just about as difficult for me to arrive at 4,600,000 acre-feet as it would have been to arrive at 4,200,000 acre-feet. The arguments pro and con have been debated in the committee for quite a period of time. The contentions made by the Senators from Arizona have not been conclusive to my mind. For instance, I will refer to the fact that Arizona desires to eliminate entirely all waters arising in the watershed and flowing out of the Gila River.
176
'Mr. HAYDEN. There is nothing of that kind in the Senator's amendment.
177
'Mr. PHIPPS. There is nothing of that kind in the Senator's amendment, but that has been one of the arguments advanced by California as being an offset to the amount to which Arizona would try to limit California.
178
'Mr. HAYDEN. If the Senator thought there was force in that argument, I should think that he would have included in his amendment a provision eliminating the waters of the Gila River and its tributaries, as my amendment does.
179
'Mr. PHIPPS. I do not consider it necessary because the bill itself, not only the present substitute measure but every other bill on the subject, ties this question up with the Colorado River compact.
180
'Mr. HAYDEN. My amendment does that.
181
'Mr. PHIPPS. Yes; that is true, but under estimates of engineers—one I happen to recall being made, I think, by Mr. La Rue—notwithstanding all of the purposes to which water of the Gila may be put by the State of Arizona, at least 1,000,000 acre-feet will return to the main stream. Yet Arizona contends that that water is not available to California; whereas to-day and for years past at least some of the waters from the Gila River have come into the canal which is now supplying the Imperial Valley.
182
'It is not a definite fixed fact that with the enactment of this proposed legislation the all-American canal is going to be built within the period of seven years; as a matter of fact, it may not be built at all; we do not know as to that. But I do not think that the water from the Gila River, one of the main tributaries of the Colorado, should be eliminated from consideration. I think that California is entitled to have that counted in as being a part of the basic supply of water.' (Italics added.)
183
It is plain from this colloquy that Senator Phipps thought that his amendment, limiting the amount California can claim, 'ties this question up with the Colorado River compact' and that the Gila River (below Lake Mead) should be 'counted in as being a part of the basic supply of water' which California is entitled to have included in the computations for the Lower Basin States.
184
The word of Senator Phipps, who was chairman of the committee and who offered the amendment, is to be taken as against those in opposition or those who might be making legislative history to serve their ends. Schwegmann Bros. v. Calvert Corp., supra, 341 U.S. pp. 394—395, 71 S.Ct. pp. 750—751: 'The fears and doubts of the opposition are no authoritative guide to the construction of legislation. It is the sponsors that we look to when the meaning of the statutory words is in doubt.'
185
If California were restricted by the Project Act to the use of 4,400,000 acre-feet out of the mainstream, it is difficult to believe that Senator Ashurst of Arizona would have expressed his bitter minority views in the Report on the Project Act. S. Rep. No. 592, 70th Cong., 1st Sess., pt. 2. He said that the bill 'sedulously and intentionally proposes to sever Arizona's jugular vein' (id., p. 3), that 'the amount of water apportioned to California * * * is not warranted in equity, law, justice, or morals' (id., p. 4), that the bill is 'a reckless and relentless assault upon Arizona.' Id., p. 38. He apparently never imagined that the proposed legislation would confine California to mainstream water. He indeed charged that the bill 'authorizes California, which comprises only 2 1/2 per cent of the Colorado River Basin and contributes no water, to appropriate * * * over 38 per cent of the estimated constant water supply available in the main Colorado River for all seven States in the basin and for Mexico.' Id., p. 5.
186
Like Senator Ashurst and like the Chairman of the Senate Commitee, Senator Phipps, I too read the Project Act to speak in terms of the entire Colorado River System in the United States.
187
APPENDIX TO OPINION OF MR. JUSTICE DOUGLAS.
188
Section 4(a) of the Project Act provides in relevant part:
189
'This Act shall not take effect and no authority shall be exercised hereunder and no work shall be begun and no moneys expended on or in connection with the works or structures provides for in this Act, and no water rights shall be claimed or initiated hereunder, and no steps shall be taken by the United States or by others to initiate or perfect any claims to the use of water pertinent to such works or structures unless and until (1) the States of Arizona, California, Colorado, Nevada, New Mexico, Utah, and Wyoming shall have ratified the Colorado River compact, mentioned in section 13 hereof, and the President by public proclamation shall have so declared, or (2) if said States fail to ratify the said compact within six months from the date of the passage of this Act then, until six of said States, including the State of California, shall ratify said compact and shall consent to waive the provisions of the first paragraph of Article XI of said compact, which makes the same binding and obligatory only when approved by each of the seven States signatory thereto, and shall have approved said compact without conditions, save that of such six-State approval, and the President by public proclamation shall have so declared, and, further, until the State of California, by act of its legislature, shall agree irrevocably and unconditionally with the United States and for the benefit of the States of Arizona, Colorado, Nevada, New Mexico, Utah, and Wyoming, as an express covenant and in consideration of the passage of this Act, that the aggregate annual consumptive use (diversions less returns to the river) of water of and from the Colorado River for use in the State of California, including all uses under contracts made under the provisions of this Act and all water necessary for the supply of any rights which may now exist, shall not exceed four million four hundred thousand acre-feet of the waters apportioned to the lower basin States by paragraph (a) of Article III of the Colorado River compact, plus not more than one-half of any excess or surplus waters unapportioned by said compact, such uses always to be subject to the terms of said compact.
190
'The States of Arizona, California, and Nevada are authorized to enter into an agreement which shall provide (1) that of the 7,500,000 acre-feet annually apportioned to the lower basin by paragraph (a) of Article III of the Colorado River compact, there shall be apportioned to the State of Nevada 300,000 acre-feet and to the State of Arizona 2,800,000 acre-feet for exclusive beneficial consumptive use in perpetuity, and (2) that the State of Arizona may annually use one-half of the excess or surplus waters unapportioned by the Colorado River compact, and (3) that the State of Arizona shall have the exclusive beneficial consumptive use of the Gila River and its tributaries within the boundaries of said State, and (4) that the waters of the Gila River and its tributaries, except return flow after the same enters the Colorado River, shall never be subject to any diminution whatever by any allowance of water which may be made by treaty or otherwise to the United States of Mexico but if, as provided in paragraph (c) of Article III of the Colorado River compact, it shall become necessary to supply water to the United States of Mexico from waters over and above the quantities which are surplus as defined by said compact, then the State of California shall and will mutually agree with the State of Arizona to supply, out of the main stream of the Colorado River, one-half of any deficiency which must be supplied to Mexico by the lower basin, and * * * (6) that all of the provisions of said tri-State agreement shall be subject in all particulars to the provisions of the Colorado River compact * * *.'
191
By § 1 of the California Limitation Act it was provided that when the seven States approved the Compact and its approval is proclaimed by the President that:
192
'* * * the State of California as of the date of such proclamation agrees irrevocably and unconditionally with the United States and for the benefit of the states of Arizona, Colorado, Nevada, New Mexico, Utah and Wyoming as an express covenant and in consideration of the passage of the said 'Boulder Canyon Project Act' that the aggregate annual consumptive use (diversions less returns to the river) of water of and from the Colorado river for use in the State of California including all uses under contracts made under the provisions of said 'Boulder canyon project act,' and all water necessary for the supply of any rights which may now exist, shall not exceed four million four hundred thousand acre-feet of the waters apportioned to the lower basin states by paragraph 'a' of article three of the said Colorado river compact, plus not more than one-half of any excess or surplus waters unapportioned by said compact, such uses always to be subject to the terms of said compact.'
193
Article III of the Compact provides in relevant part:
194
'(a) There is hereby apportioned from the Colorado River System in perpetuity to the Upper Basin and to the Lower Basin, respectively, the exclusive beneficial consumptive use of 7,500,000 acre-feet of water per annum, which shall include all water necessary for the supply of any rights which may now exist.
195
'(b) In addition to the apportionment in paragraph (a), the Lower Basin is hereby given the right to increase its beneficial consumptive use of such waters by one million acre-feet per annum.
196
'(c) If, as a matter of international comity, the United States of America shall hereafter recognize in the United States of Mexico any right to the use of any waters of the Colorado River System, such waters shall be supplied first from the waters which are surplus over and above the aggregate of the quantities specified in paragraphs (a) and (b); and if such surplus shall prove insufficient for this purpose, then, the burden of such deficiency shall be equally borne by the Upper Basin and the Lower Basin, and whenever necessary the States of the Upper Division shall deliver at Lee Ferry water to supply one-half of the deficiency so recognized in addition to that provided in paragraph (d).
197
'(d) The States of the Upper Division will not cause the flow of the river at Lee Ferry to be depleted below an aggregate of 75,000,000 acre-feet for any period of ten consecutive years reckoned in continuing progressive series beginning with the first day of October next succeeding the ratification of this compact.'
1
'The judicial Power shall extend * * * to Controversies between two or more States * * *.
'In all Cases * * * in which a State shall be Party, the supreme Court shall have original Jurisdiction.' U.S.Const., Art. III, § 2. See also 28 U.S.C. § 1251(a)(1).
Three times previously Arizona has instituted actions in this Court concerning the Colorado River. Arizona v. California, 283 U.S. 423, 51 S.Ct. 522, 75 L.Ed. 1154
(1931); Arizona v. California, 292 U.S. 341, 54 S.Ct. 735, 78 L.Ed. 1298 (1934); Arizona v. California, 298 U.S. 558, 56 S.Ct. 848, 80 L.Ed. 1331 (1936). See also United States v. Arizona, 295 U.S. 174, 55 S.Ct. 666, 79 L.Ed. 1371 (1935).
2
Palo Verde Irrigation District, Imperial Irrigation District, Coachella Valley County Water District, Metropolitan Water District of Southern California, City of Los Angeles, City of San Diego, and County of San Diego.
3
344 U.S. 919, 73 S.Ct. 385, 97 L.Ed. 708 (1953) (intervention by United States); 347 U.S. 985, 74 S.Ct. 848, 98 L.Ed. 1121 (1954) (intervention by Nevada); 350 U.S. 114, 76 S.Ct. 188, 100 L.Ed. 125 (1955) (joinder of Utah and New Mexico).
4
The two orders are reported at 347 U.S. 986, 74 S.Ct. 848, 98 L.Ed. 1121 (1954), and 350 U.S. 812, 76 S.Ct. 43, 100 L.Ed. 728 (1955).
5
364 U.S. 940, 81 S.Ct. 457 (1961).
6
Boulder Canyon Project Act, 45 Stat. 1057 (1928), 43 U.S.C. §§ 617—617t.
7
'(The All-American Canal) will end an intolerable situation, under which the Imperial Valley now secures its sole water supply from a canal running for many miles through Mexico * * *.' S.Rep. No. 592, 70th Cong., 1st Sess. 8 (1928).
8
Department of the Interior, Report of the All-American Canal Board (1919), 23—33. The three members of the Board were engineers with long experience in Western water problems.
9
41 Stat. 600 (1920).
10
S.Doc.No.142, 67th Cong., 2d Sess. (1922).
11
Id., at 1.
12
The reasons given were:
'1. The Colorado River is international.
'2. The stream and many of its tributaries are interstate.
'3. It is a navigable river.
'4. Its waters may be made to serve large areas of public lands naturally desert in character.
'5. Its problems are of such magnitude as to be beyond the reach of other than national solution.' Ibid.
13
Id., at 21.
14
This law prevails exclusively in all the basin States except California. See I Wiel, Water Rights in the Western States § 66 (3d ed., 1911); Hutchins, Selected Problems in the Law of Water Rights in the West 30—31 (1942) (U.S. Dept. of Agriculture Misc.Pub.No.418). Even in California it is important. See 51 Cal.Jur.2d Waters §§ 257—264 (1959).
15
Hinderlider v. La Plata River & Cherry Creek Ditch Co., 304 U.S. 92, 98, 58 S.Ct. 803, 805, 82 L.Ed. 1202 (1938); Arizona v. California, 283 U.S. 423, 459, 51 S.Ct. 522, 527, 75 L.Ed. 1154 (1931).
16
The doctrine continues to be applied interstate. E.g., Nebraska v. Wyoming, 325 U.S. 589, 617—618, 65 S.Ct. 1332, 1350 1351, 89 L.Ed. 1815 (1945).
17
'Delph E. Carpenter, Colorado River Commissioner for the State of Colorado, summarized the situation produced by that decision as follows:
"The upper state has but one alternative, that of using every means to retard development in the lower state until the uses within the upper state have reached their maximum. The states may avoid this unfortunate situation by determining their respective rights by interstate compact before further development in either state, thus permitting freedom of development in the lower state without injury to future growth in the upper.'
'The final negotiation of the compact took place in the atmosphere produced by that decision.' H.R.Doc.No.717, 80th Cong., 2d Sess. 22 (1948).
18
H.R.Rep.No.191, 67th Cong., 1st Sess. (1921).
19
42 Stat. 171 (1921).
20
The Compact can be found at 70 Cong.Rec. 324 (1928), and U.S. Dept. of the Interior, Documents on the Use and Control of the Waters of Interstate and International Streams 39 (1956).
21
H.R.Doc.No.717, 80th Cong., 2d Sess. 22 (1948).
22
An acre-foot of water is enought to cover an acre of land with one foot of water.
23
'Beneficial consumptive use' means consumptive use measured by diversions less return flows, for a beneficial (nonwasteful) purpose.
24
Arizona did ratify the Compact in 1944, after it had already become effective by six-state ratification as permitted by the Boulder Canyon Project Act.
25
Hearings on H.R. 5773 before the House Committee on Irrigation and Reclamation, 70th Cong., 1st Sess. 402—405 (1928).
26
Id., at 30—31. Arizona also objected to the provisions concerning electrical power.
27
H.R. 11449, 67th Cong., 2d Sess. (1922); H.R. 2903, S. 727, 68th Cong., 1st Sess. (1923); H.R. 9826, S. 3331, 69th Cong., 1st Sess. (1926).
28
Another purpose of the Act was to approve the Colorado River Compact, which had allocated the water between the two basins.
29
The Upper Basin States feared that, if Arizona did not ratify the Compact, the division of water between the Upper and Lower Basins agreed on in the Compact would be nullified. The reasoning was that Arizona's uses would not be charged against the Lower Basin's apportionment and that California would therefore be free to exhaust that apportionment herself. Total Lower Basin uses would then be more than permitted in the Compact, leaving less water for the Upper Basin.
30
46 Stat. 3000 (1929).
31
California Limitation Act, Cal.Stat.1929, c. 16, at p. 38.
32
Colorado v. Kansas, 320 U.S. 383, 392, 64 S.Ct. 176, 180, 88 L.Ed. 1116 (1943); Nebraska v. Wyoming, 325 U.S. 589, 616, 65 S.Ct. 1332, 1349, 89 L.Ed. 1815 (1945).
33
E.g., Kansas v. Colorado, 185 U.S. 125, 22 S.Ct. 552, 46 L.Ed. 838 (1902); New Jersey v. New York, 283 U.S. 336, 51 S.Ct. 478, 75 L.Ed. 1104 (1931).
34
E.g., Wyoming v. Colorado, 259 U.S. 419, 42 S.Ct. 552, 66 L.Ed. 999 (1922); Nebraska v. Wyoming, 325 U.S. 589, 65 S.Ct. 1332, 89 L.Ed. 1815 (1945).
35
H.R.Doc. No. 717, 80th Cong., 2d Sess. 22 (1948).
36
"Domestic' whenever employed in this Act shall include water uses defined as 'domestic' in said Colorado River compact.'
37
The dam and reservoir shall be used, among other things, for 'satisfaction of present perfected rights in pursuance of Article VIII of Said Colorado River compact.'
38
§§ 1, 8(a), 13(b) and (c).
39
Also, California would reduce Nevada's share of the mainstream waters from 300,000 acre-feet to 120,500 acre-feet.
40
Not only does the Gila enter the Colorado almost at the Mexican border, but also in dry seasons it virtually evaporates before reaching the Colorado.
41
See 69 Cong.Rec. 9454 (1928).
42
See 70 Cong.Rec. 172 (1928).
43
Hearings on H.R. 5773, supra note 25, at 30—31.
44
Id., at 402.
45
H.R. 5773, 70th Cong., 1st Sess.; 69 Cong.Rec. 9989—9990 (1928).
46
S.Rep. No. 592, 70th Cong., 1st Sess. 2 (1928).
47
70 Cong.Rec. 324 (1928).
48
Id., at 162.
49
Id., at 384.
50
Id., at 385.
51
45 Stat. 1057 (1928). Arizona's Senators Ashurst and Hayden voted against the bill, which did not exempt the Gila from the Mexican burden. 70 Cong.Rec. 603 (1928).
52
70 Cong.Rec. 459 (1928). That this change was not intended to cause the States to give up their tributaries may reasonably be inferred from the fact that the amendment was agreed to by Senator Hayden, who was a constant opponent of including the tributaries.
53
Id., at 77.
54
Ibid. Later, Senator Hayden said that his amendment incorporated the Governors' proposal. Id., at 172—173.
55
Id., at 386.
56
Id., at 164 (King), 165 (Johnson, Bratton), 382 (Hayden, Phipps), 385 (Bratton), 386 (Pittman). Senator Hayden's statement is representative: 'I want to state to the Senate that what I am trying to accomplish is to get a vote on the one particular question of whether the quantity of water which the State of California may divert from the Colorado River should be 4,200,000 acre-feet or 4,600,000 acre-feet.' Id., at 382.
57
E.g., Report, Colorado River Commission of Arizona (1927), reprinted in Hearings on H.R. 5773, supra note 25, at 25 31; 69 Cong.Rec. 9454 (1928) (Arizona's proposal at Denver).
58
70 Cong.Rec. 467—468 (1928). See also id., at 463—464, 465.
59
Id., at 237.
60
Id., at 466—467.
61
Id., at 469. See also id., at 232.
62
See id., at 463 (Shortridge); id., at 465 (King).
63
Hearings on H.R. 5773, supra note 25, at 50.
64
69 Cong.Rec. 9990 (1928).
65
70 Cong.Rec. 67 (1928).
66
Id., at 603.
67
Id., at 837—838.
68
45 Stat. 1057.
69
See S.Rep.No. 592, 70th Cong., 1st Sess. 2 (1928).
70
70 Cong.Rec. 162 (1928).
71
Id., at 232.
72
Id., at 277, 385.
73
Id., at 333.
74
Id., at 387.
75
Id., at 467. See also id., at 465.
76
For exemple, Senator Pittman's active role in resolving the whole Colorado River problem was acknowledged by Senator Hayden on the Senate floor:
'When Congress assembled in December, 1927, no agreement had been made. The senior Senator from Nevada (MR. PITTMAN), in continuation of the earnest efforts that he has made all these years to bring about a settlement of the controversy between the States with respect to the Colorado River, invited a number of us to conferences in his office and there we talked over the situation.' Id., at 172.
77
Id., at 468—469.
78
Id., at 471. The Senator added, 'We have already decided as to the division of the water, and we say that if the States wish they can enter into a subsidiary agreement confirming that.' Ibid.
79
In the debates leading to the passage of the bill, Senator Walsh observed that 'to contract means a liberty of contract' and asked if this did not mean that the Secretary could 'give the water to them (appropriators) or withhold if from them as he sees fit,' to which Senator Johnson answered 'certainly.' 70 Cong.Rec. 168 (1928).
80
See Hearings on H.R. 6251 and 9826 before the Committee on Irrigation and Reclamation, 69th Cong., 1st Sess. 12 (1926).
81
See id., at 97, 115.
82
Bean v. Morris, 221 U.S. 485, 31 S.Ct. 703, 55 L.Ed. 821 (1911). This case was relied on by Mr. Justice Van Devanter in Wyoming v. Colorado, 259 U.S. 419, 466, 42 S.Ct. 552, 558, 66 L.Ed. 999 (1922).
83
70 Cong.Rec. 168 (1928). Other statements by Senator Johnson are less damaging to California's claims. For example, the Senator at another point in the colloquy with Senator Walsh said that he doubted if the Secretary either would or could disregard Los Angeles and contract with someone having no appropriation. Ibid. It is likely, however, that Senator Johnson was talking about present perfected rights, as a few minutes before he had argued that Los Angeles had taken sufficient steps in perfecting its claims to make them protected. See id., at 167. Present perfected rights, as we have observed in the text, are recognized by the Act. § 6.
84
70 Cong.Rec. 169 (1928). At one point Senator Hayden seems to say that the Secretary's contracts are to be governed by state law:
'The only thing required in this bill is contained in the amendment that I have offered, that there shall be apportioned to each State its share of the water. Then, who shall obtain that water in relative order of priority may be determined by the State courts.' Ibid.
But, in view of the Senator's other statements in the same debate, this remark of a man so knowledgeable in western water law makes sense only if one understands that the 'order of priority' being talked about was the order of present perfected rights rights which Senator Hayden recognized, see id., at 167, and which the Act preserves in § 6.
85
69 Cong.Rec. 9623, 9648, 9649 (1928). We recognize, of course, that statements of opponents of a bill may not be authoritative, see Schwegmann Bros. v. Calvert Distillers Corp., 341 U.S. 384, 394—395, 71 S.Ct. 745, 750—751, 95 L.Ed. 1035, 19 A.L.R.2d 1119 (1951), but they are nevertheless relevant and useful, especially where, as here, the proponents of the bill made no response to the opponents' criticisms.
86
See, e.g., Ickes v. Fox, 300 U.S. 82, 57 S.Ct. 412, 81 L.Ed. 525 (1937); cf. Best v. Humboldt Placer Mining Co., 371 U.S. 334, 83 S.Ct. 379, 9 L.Ed.2d 350 (1963); Boesche v. Udall, 373 U.S. 472, 83 S.Ct. 1373.
87
'Nothing in (this Act) shall be construed as affecting or intended to affect or to in any way interfere with the laws of any State or Territory relating to the control, appropriation, use, or distribution of water used in irrigation, or any vested right acquired thereunder, and the Secretary of the Interior, in carrying out the provisions of such sections, shall proceed in conformity with such laws, and nothing (herein) shall in any way affect any right of any State or of the Federal Government or of any landowner, appropriator, or user of water in, to, or from any interstate stream or the waters thereof.' 43 U.S.C. § 383.
88
Arizona v. California, 283 U.S. 423, 51 S.Ct. 522, 75 L.Ed. 1154 (1931).
89
United States v. Gerlach Live Stock Co., 339 U.S. 725, 738, 70 S.Ct. 955, 962, 94 L.Ed. 1231, 20 A.L.R.2d 633 (1950).
90
First Iowa Hydro-Elec. Coop. v. Federal Power Comm'n, 328 U.S. 152, 171, 66 S.Ct. 906, 915, 90 L.Ed. 1143 (1946). See United States v. Chandler-Dunbar Water Power Co., 229 U.S. 53, 62—72, 33 S.Ct. 667, 671—675, 57 L.Ed. 1063 (1913); United States v. Willow River Power Co., 324 U.S. 499, 65 S.Ct. 761, 89 L.Ed. 1101, 103 Ct.Cl. 797 (1945).
91
See Arizona v. California, 283 U.S. 423, 51 S.Ct. 522, 75 L.Ed. 1154 (1931); Nebraska v. Wyoming, 325 U.S. 589, 615, 65 S.Ct. 1332, 1349, 89 L.Ed. 1115 (1945); First Iowa Hydro-Elec. Coop., v. Federal Power Comm'n, 328 U.S. 152, 66 S.Ct. 906, 90 L.Ed. 1143 (1946).
92
Nebraska v. Wyoming, 325 U.S. 589, 65 S.Ct. 1332, 89 L.Ed. 1115 (1945), holds nothing to the contrary. There the Court found it unnecessary to decide what rights the United States had under federal law to the unappropriated water of the North Platte River, since the water rights on which the projects in that case rested had in fact been obtained in compliance with state law.
93
See First Iowa Hydro-Elec. Coop. v. Federal Power Comm'n, 328 U.S. 152, 175—176, 66 S.Ct. 906, 916—917, 90 L.Ed. 1143 (1946), where this Court limited the effect of § 27 of the Federal Power Act, which expressly 'saved' certain state laws, to vested property rights.
94
By an Act of September 2, 1958, 72 Stat. 1726, the Secretary must supply water to Boulder City, Nevada. It follows from our conclusions as to the inapplicability of state law that, contrary to the Master's conclusion, Boulder City's priorities are not to be determined by Nevada law.
95
The location of Hoover Dam is a result of engineering decisions. As Senator Pittman pointed out, 'There is no place to impound the flood waters except at the lower end of the canyon.' 68 Cong.Rec. 4413 (1927).
96
Proration of shortage is the method agreed upon by the United States and Mexico to adjust Mexico's share of Colorado River water should there be insufficient water to supply each country's apportionment.
97
The Reservations were Chemehuevi, Cocopah, Yuma, Colorado River and Fort Mohave.
98
Act of March 3, 1865, 13 Stat. 541, 559.
99
See Executive Orders of November 22, 1873, November 16, 1874, and May 15, 1876. See also Executive Order of November 22, 1915. These orders may be found in 1 U.S. Dept. of the Interior, Executive Orders Relating to Indian Reservations 6—7 (1912); 2 id., at 5—6 (1922).
100
Executive Orders of January 9, 1884 (Yuma), September 19, 1890 (Fort Mohave), February 2, 1911 (Fort Mohave), September 27, 1917 (Cocopah). For these orders, see 1 id., at 12—13, 63—64 (1912); 2 id., at 5 (1922). The Chemehuevi Reservation was established by the Secretary of the Interior on February 2, 1907, pending congressional approval.
101
See, e.g., United States v. California, 332 U.S. 19, 29 30, 67 S.Ct. 1658, 1663—1664, 91 L.Ed. 1889 (1947); United States v. Holt State Bank, 270 U.S. 49, 54—55, 46 S.Ct. 197, 198—199, 70 L.Ed. 465 (1926).
102
See United States v. Midwest Oil Co., 236 U.S. 459, 469 475, 35 S.Ct. 309, 311—314, 59 L.Ed. 973 (1915); Winters v. United States, 207 U.S. 564, 28 S.Ct. 207, 52 L.Ed. 340 (1908).
1
Hearings before House Committee on Irrigation and Reclamation on H.R. 6251 and H.R. 9826, 69th Cong., 1st Sess. 163.
2
Hearings before House Committee on Rules on H.R. 9826, 69th Cong., 2d Sess. 116. The bill then under consideration, as recommended by the House Committee on Irrigation and Reclamation, appears in H.R.Rep.No.1657, 69th Cong., 2d Sess. 29—34.
3
The only change that need be noted for present purposes is the addition of a clause requiring contracts to conform to § 4(a), discussed below, as well as to the Compact.
4
Arizona: Clough v. Wing, 2 Ariz. 371, 17 P. 453; Colorado: Coffin v. Left Hand Ditch Co., 6 Colo. 443; Nevada: Jones v. Adams, 19 Nev. 78, 6 P. 442; New Mexico: Albuquerque Land & Irr. Co. v. Gutierrez, 10 N.M. 177, 61 P. 357; Utah: Stowell v. Johnson, 7 Utah 215, 26 P. 290; Wyoming: Moyer v. Preston, 6 Wyo. 308, 44 P. 845.
5
California: Osgood v. El Dorado Water & Deep Gravel Mining Co., 56 Cal. 571.
6
E.g., Coffin v. Left Hand Ditch Co., 6 Colo. 443, 446—447, 449—450; Stowell v. Johnson, 7 Utah 215, 225, 26 P. 290, 291; Willey v. Decker, 11 Wyo. 496, 515—524, 73 P. 210, 215—218. 'Irrigation,' said the Nevada court, ' * * * would be strangled by the enforcement of the riparian principle.' Twaddle v. Winters, 29 Nev. 88, 106, 85 P. 280, 284, 89 P. 289.
7
Ward Bannister, Denver attorney and spokesman for the Upper Basin States, said that '(t)he purpose of the compact is to provide the three lower States with a fund of water from which they may appropriate and the four upper States with a fund of water from which they may appropriate.' Hearings before House Committee on Irrigation and Reclamation on H.R. 2903, 68th Cong., 1st Sess. 232.
8
See the remarks of Senator Hayden, 70 Cong.Rec. 388.
9
See, e.g., H.R.Rep.No.1657, 69th Cong., 2d Sess., pt. 2, 3 4; Hearings, supra, note 2, at 34—37.
10
Hearings before Senate Committee on Irrigation and Reclamation pursuant to S.Res.No.320, 68th Cong., 2d Sess. 663 675. 'It was the oppression of the National Government strangling development, preventing development in the States. * * * These two experiences and others taught Colorado, Wyoming, and New Mexico the extent to which a department of the United States would go in overriding State authority and oppressing whole communities. * * * Thus it came to the attention of the States, that the United States Government intended to supersede all State law and override State authority on that river. * * * (A)ny desire by a governmental bureau to ultimately, by insiduous (sic) or other methods, take over the control the dominion of the streams within the States and to override State authority at once becomes not only abhorrent but gives rise to a feeling of bitter resentment and sounds a call to arms for self-defense. * * *' Id., at 663, 665, 671, 673. See also his remarks at Hearings, supra, note 1, at 146—157.
11
Senator KING: 'If the Senator means by his statement that the Federal Government may go into a stream, whether it be the Colorado River, the Sacramento River, or a river in the State of Montana, and put its powerful hands down upon the stream and say, 'This is mine; I can build a dam there and allocate water to whom I please, regardless of other rights, either suspended, inchoate, or perfected,' I deny the position which the Senator takes.' 70 Cong.Rec. 169. The Senator in question was Carl Hayden; he denied that his statement, which concerned his authorization for a compact among the three lower States, meant any such thing.
Senator PHIPPS: 'I am firmly convinced that there must be voluntary ratification on the part of each interested State in order to make the compact effective. This is the only method of settling possible controversies permanently and of putting the water of the stream to its highest beneficial use. It is the only satisfactory method; it is the only legal method to avoid proceedings in the courts which would prove costly and almost interminable.' 68 Cong.Rec. 4515.
Senator HAYDEN: 'There are only two ways in which this controversy can be settled. Either the States can agree upon an equitable apportionment of waters of the Colorado River or, in the absence of a compact, the Supreme Court of the United States can determine what the rights of the various States are in on (sic) that stream. * * * Arizona denies that it is within the power of Congress to apportion the waters of an interstate stream among the States.' Hearings, supra, note 2, at 75, 76. (Emphasis added.)
Representative COLTON: 'I have been informed that an attorney for the Reclamation Service of the United States claims that Congress has the power to allocate and apportion all of the Colorado River among the States regardless of their wishes in the matter. Such a theory is abhorrent to our whole plan of government and particularly to the theory on which our whole system of water rights has been built up.' Hearings before House Committee on Irrigation and Reclamation on H.R. 5773, 70th Cong., 1st Sess. 414.
Representative LEATHERWOOD: '(T)here are only two agencies that can allocate the waters of this great river, the States themselves by treaty ratified by the Congress of the United States, or by the judicial branch of the Government; for the Congress has no power to allocate any of the waters of this river or any other river where the doctrine of prior appropriation is in force.' Hearings, supra, note 2, at 31.
WARD BANNISTER: '(T)here is nothing in the Federal Constitution upon which to base the power of the Federal Government to divide this water among the States. * * * (T)he same thing that would invalidate a provision inserted by Congress direct would invalidate any rule promulgated by the Secretary of the Interior under Congressional permission, and the upper States would find themselves utterly helpless.' Hearings, supra, n. 7, at 195.
12
68 Cong.Rec. 4763; S.Rep.No.592, 70th Cong., 1st Sess. 2.
13
S.Rep.No.592, 70th Cong., 1st Sess. 2.
14
See note 10, supra, and accompanying text.
15
Hearings, supra, note 1, at 6, 46.
16
H.R. 9826, 69th Cong., 1st Sess., § 5.
17
S.1868, 69th Cong., 1st Sess.; H.R. 6251, 69th Cong., 1st Sess.; H.R. 9826, 69th Cong., 1st Sess. This amendment, wrote Secretary Work in recommending the bill, 'provides for the distribution and use of all water for irrigation, power and otherwise, in accordance with the Colorado River compact.' Hearings, supra, note 1, at 8.
18
See notes 1, 2, supra, and accompanying text. Contracts were later made subject also to the California limitation in § 4(a).
19
It is significant to contrast the language giving the Secretary authority to enter water delivery contracts with that in § 5(c), relating to the distribution of electrical power. The latter provision explicitly gives the Secretary authority to resolve conflicts in applications, referring him for the governing standards to 'the policy expressed in the Federal Water Power Act as to conflicting applications for permits and licenses.'
20
Hearings, supra, note 1, at 12.
21
Id., at 115.
22
Id., at 97, 115.
23
Thus, almost in the same breath with which Representative Colton made his then seemingly dire prediction of national control, he declared that 'Arizona is not a party at all to this compact. She and her citizens may appropriate water at any time.' 69 Cong.Rec. 9648. Arizona, as has already been pointed out, was busily opposing the bill on the specific ground that it left California free to appropriate from the river.
24
The one apparent exception to the unanimity of view among the bill's supporters is the statement in Representative Smith's report of the third Swing bill to the House: 'All rights respecting water or power under the project are, under the terms of the bill, to be disposed of by contract by the Government. It is not reasonable to assume that the Government will do anything of an unfair or prejudicial nature to Arizona.' H.R.Rep.No.1657, 69th Cong., 2d Sess. 11.
25
See note 1, supra, and accompanying text. Mr. Carpenter's remarks also included the following: 'Except by contract made as herein stated' means this: If the flow of the Colorado River is controlled and regulated by the construction of the Black Canyon Dam, and any person in the State of Arizona attempt to take any water out of the stream which has been discharged from the reservoir and is being carried in the stream bed, as a natural conduit, for delivery to lower users, this law would be brought into effect and he would be prevented from using any of that water independent of the Colorado River compact but unincumbered by any other condition for the benefit of California and Nevada. In other words, the compact does not disturb the rights between Arizona, California, and Nevada, inter sese, as to their portion of the water.' Hearings, supra, note 1, at 163.
26
'If a dam shall be built at Boulder Canyon it will impound certain waters and equate the flow below. The water below will be subject to appropriation and use by both California and Arizona. * * * In other words, there is nothing in this proposed legislation that could prevent Arizona from appropriating from the Colorado River within her borders all of the water she could use for irrigation.' 68 Cong.Rec. 4412.
27
'It seems to me that in resolving such a difficulty, should it arise, there would be taken into consideration the fact that water for domestic use should take priority over water intended for purposes of irrigation. Aside from that, these filings are first in point as compared with those to which the Senator from Arizona referred. They are for a superior use, and, in addition thereto, the applicant who has made the filing has pursued the proper course in developing the manner of appropriation or the manner of diverting the water and putting it to the highest beneficial use. I do not anticipate any difficulty on that score in resolving the question of priority by the Secretary of the Interior.' 70 Cong.Rec. 169.
28
See 68 Cong.Rec. 3064—3065; Hearings before House Committee on Irrigation and Reclamation on H.R. 5773, 70th Cong., 1st Sess. 191, 193, 214—215.
29
See Hearings, supra, note 1, at 98, 116, 117.
30
Delph Carpenter said that the Secretary's contracts should be lagged for only a limited period of time in order to give the States complete freedom to agree. Id., at 204.
31
It should also be noted that, as the Master held, § 18, quoted ante, p. 585, clearly leaves each State free to apply its own law in determining rights among users within its borders. The Court's strained reading of this provision emasculates it entirely and sacrifices even matters of solely intrastate concern on the altar of federal supremacy.
32
See pp. 604-605, 619—620, supra.
33
Nor is anything said in City of Fresno v. California, 372 U.S. 627, 83 S.Ct. 996, relevant here, since the Court there stated only that if the Government exercises its power of eminent domain, 'the effect of § 8 in such a case is to leave to state law the definition of the property interests, if any, for which compensation must be made.' 372 U.S., at 630, 83 S.Ct. at 998. Fresno did not consider the question now presented: the effect of § 8 in the absence of any exercise of the federal power of eminent domain.
34
Nor, I submit, does the Court suggest any standards. Certainly, there is nothing in the enumeration of purposes in § 6 which will be of any assistance in helping the Secretary allocate the burden of shortages among competing irrigation and domestic uses within and among the Lower Basin States.
35
See the discussion in Comment, 14 Stat.L.Rev. 372.
1
The relevant provisions of the Project Act, the California Limitation, and, and the Colorado River Compact are set forth in the Appendix, p. 643.
2
See the Appendix, pp. 645—646, for the relevant portions of Article III.
3
It is said that the § 4(a) language referring to surplus or excess waters, one-half of which is to go to California, the other to Arizona, is meaningless if read literally. That turns on the meaning of the words 'excess or surplus waters unapportioned' by the Compact. They mean, it is said, all waters unapportioned by Article III(a) and (b), because Article III(c) defines or speaks of surplus in such manner as to indicate that surplus is only that water over and above Article III(a) and (b) water. This is true, at least for the limited purpose of Article III(c). From that premise it is reasoned that § 4(a), literally construed, would allow Arizona and California to split equally all waters over 16,000,000 acre-feet,
that is after 7,500,000 acre-feet went to each of the Basins, and after the Lower Basin received an additional 1,000,000 acre-feet under the provisions of Article III(b). If that is true and if California and Arizona were allowed to divide up the rest, the Upper Basin States would forever be limited to their initial 7,500,000 acre-feet, something not contemplated by Article III(f), which specifically provides for apportionment of waters in excess of 16,000,000 between the Upper and Lower Basins. Thus, it is argued that the words 'excess or surplus waters' as used in § 4(a) are meaningless and in hopeless conflict with the terms of the Compact if read literally.
This interpretation is ill-founded. The first paragraph of § 4(a) contains only a limitation; it apportions no water. The tri-state compact authorized by the second paragraph of § 4(a) has never been made. But, even if it had been made, it could affect only the rights of its signatories vis-a -vis each other. For § 4(a) explicitly provides 'that all of the provisions of said tri-State agreement shall be subject in all particulars to the provisions of the Colorado River compact.'
The words 'excess or surplus waters unapportioned by said compact' mean, I think, Article III(b) waters plus all waters in the entire System in excess of 16,000,000 acre-feet. Not only does this interpretation allow the Project Act and the Colorado River Compact to be construed as a harmonious whole, but is is also compelled by the legislative history. See 70 Cong.Rec. 459—460.
4
Under § 4(a) of the Project Act it is provided that if all seven States fail to ratify the Compact in six months (which in fact they did fail to do), the Project Act shall not take effect until six of the States, including California, ratify the Compact and waive the provisions of Article XI of the Compact (which required approval of all seven States) and the President has so declared by public proclamation. A further condition was the passage of California's Limitation Act. The Presidential Proclamation is dated June 25, 1929. 46 Stat. 3000; and California's Limitation Act was approved March 4, 1929, and became effective August 14, 1929.
5
The Colorado River Compact is referred to many times in the Project Act—s 1, § 4(a), § 6, § 8, § 12, § 13, § 18, and § 19.
By § 18 the rights of the States to waters within their borders are not interfered with 'except as modified by the Colorado River compact or other interstate agreement.'
By § 8(a) 'all users and appropriators' of water are 'subject to and controlled by said Colorado River compact * * * anything in this Act to the contrary notwithstanding * * *.'
6
It was indicated in Arizona v. California, 292 U.S. 341, 357, 54 S.Ct. 735, 741, 78 L.Ed. 1298, that the Limitation Act incorporates the Compact:
'It may be true that the Boulder Canyon Project Act leaves in doubt the apportionment among the states of the lower basin of the waters to which the lower basin is entitled under article III(b)-But the act does not purport to apportion among the states of the lower basin the waters to which the lower basin is entitled under the compact. The act merely places limits on California's use of waters under article III(a) and of surplus waters; and it is 'such' uses which are 'subject to the terms of said compact."
7
See note 3, supra.
| 78
|
373 U.S. 734
83 S.Ct. 1453
10 L.Ed.2d 670
NATIONAL LABOR RELATIONS BOARD, Petitioner,v.GENERAL MOTORS CORPORATION.
No. 404.
Argued April 18, 1963.
Decided June 3, 1963.
Sol. Gen. Archibald Cox, for petitioner.
Harry S. Benjamin, Jr., Detroit, Mich., for respondent.
Mr. Justice WHITE delivered the opinion of the Court.
1
The issue here is whether an employer commits an unfair labor practice, National Labor Relations Act s 8(a)(5),1 when it refuses to bargain with a certified union over the union's proposal for the adoption of the 'agency shop.' More narrowly, since the employer is not obliged to bargain over a proposal that he commit an unfair labor practice, the question is whether the agency shop is an unfair labor practice under § 8(a)(3) of the Act or else is exempted from the prohibitions of that section by the proviso thereto.2 We have concluded that this type of arrangement does not constitute an unfair labor practice and that it is not prohibited by § 8.
2
Respondent's employees are represented by the United Automobile, Aerospace and Agricultural Implement Workers of America, UAW, in a single, multiplant company-wide unit. The 1958 agreement between union and company provides for maintenance of membership and the union shop.3 These provisions were not operative, however, in such States as Indiana where state law prohibited making union membership a condition of employment.
3
In June 1959, the Indiana intermediate appellate court held that an agency shop arrangement would not violate the state right-to-work law. Meade Elec. Co. v. Hagberg, 129 Ind.App. 631, 159 N.E.2d 408. As defined in that opinion, the term 'agency shop' applies to an arrangement under which all employees are required as a condition of employment to pay dues to the union and pay the union's initiation fee, but they need not actually become union members. The union thereafter sent respondent a letter proposing the negotiation of a contractual provision covering Indiana plants 'generally similar to that set forth' in the Meade case. Continued employment in the Indiana plants would be conditioned upon the payment of sums equal to the initiation fee and regular monthly dues paid by the union members. The intent of the proposal, the National Labor Relations Board concluded, was not to require membership but to make membership available at the employees' option and on nondiscriminatory terms. Employees choosing not to join would make the required payments and, in accordance with union custom, would share in union expenditures for strike benefits, educational and retired member benefits, and union publications and promotional activities, but they would not be entitled to attend union meetings, vote upon ratification of agreements negotiated by the union, or have a voice in the internal affairs of the union.4 The respondent made no counterproposal, but replied to the union's letter that the proposed agreement would violate the National Labor Relations Act and that respondent must therefore 'respectfully decline to comply with your request for a meeting' to bargain over the proposal.
4
The union thereupon filed a complaint with the National Labor Relations Board against respondent for its alleged refusal to bargain in good faith. In the Board's view of the record, 'the Union was not seeking to bargain over a clause requiring nonmember employees to pay sums equal to dues and fees as a condition of employment while at the same time maintaining a closed-union policy with respect to applicants for membership,' since the proposal contemplated an arrangement in which 'all employees are given the option of becoming, or refraining from becoming, members of the Union.' Proceeding on this basis and putting aside the consequences of a closed-union policy upon the legality of the agency shop, the Board assessed the union's proposal as comporting fully with the congressional declaration of policy in favor of union-security contracts and therefore a mandatory subject as to which the Act obliged respondent to bargain in good faith. At the same time, it stated that it had 'no doubt that an agency-shop agreement is a permissible form of union-security within the meaning of Sections 7 and 8(a)(3) of the Act.' Accordingly, the Board ruled that respondent had committed an unfair labor practice by refusing to bargain in good faith with the certified bargaining representative of its employees,5 and it ordered respondent to bargain with the union over the proposed arrangement; no back-pay award is involved in this case. 133 N.L.R.B. 451, 456, 457.
5
Respondent petitioned for review in the Court of Appeals, and the Board cross-petitioned for enforcement. The Court of Appeals set the order aside on the grounds that the Act tolerates only 'an agreement requiring membership in a labor organization as a condition of employment' when such agreements do not violate state right-to-work laws, and that the Act does not authorize agreements requiring payment of membership dues to a union, in lieu of membership, as a condition of employment. It held that the proposed agency shop agreement would violate §§ 7, 8(a)(1), and 8(a)(3) of the Act and that the employer was therefore not obliged to bargain over it. 303 F.2d 428 (C.A.6th Cir.). We granted certiorari, 371 U.S. 908, 83 S.Ct. 253, 9 L.Ed.2d 168, and now reverse the decision of the Court of Appeals.
6
Section 8(3) under the Wagner Act was the predecessor to § 8(a)(3) of the present law. Like § 8(a)(3), § 8(3) forbade employers to discriminate against employees to compel them to join a union. Because it was feared that § 8(3) and § 7, if nothing were added to qualify them, might be held to outlaw union-security arrangements such as the closed shop, see 79 Cong.Rec. 7570 (statement of Senator Wagner), 7674 (statement of Senator Walsh); H.R.Rep. No. 972, 74th Cong., 1st Sess. 17; H.R.Rep. No. 1147, 74th Cong., 1st Sess. 19, the proviso to § 8(3) was added expressly declaring:
7
'Provided, That nothing in this Act * * * or in any other statute of the United States, shall preclude an employer from making an agreement with a labor organization * * * to require as a condition of employment membership therein, if such labor organization is the representative of the employees as provided in section 9(a) * * *.'
8
The prevailing administrative and judicial view under the Wagner Act was or came to be that the proviso to § 8(3) covered both the closed and union shop, as well as less onerous union-security arrangements, if they were otherwise legal. The National Labor Relations Board construed the proviso as shielding from an unfair labor practice charge less severe forms of union-security arrangements than the closed or the union shop,6 including an arrangement in Public Service Co. of Colorado, 89 N.L.R.B. 418,7 requiring nonunion members to pay to the union $2 a month 'for the support of the bargaining unit.' And in Algona Plywood Co. v. Wisconsin Board, 336 U.S. 301, 307, 69 S.Ct. 584, 93 L.Ed. 691, which involed a maintenance of membership agreement, the Court, in commenting on petitioner's contention that the proviso of § 8(3) affirmatively protected arrangements within its scope, cf. Garner v. Teamsters Union, 346 U.S. 485, 74 S.Ct. 161, 98 L.Ed. 228, said of its purpose: 'The short answer is that § 8(3) merely disclaims a national policy hostile to the closed shop or other forms of union-security agreement.' (Emphasis added.)
9
When Congress enacted the Taft-Hartley Act, it added the following to the language of the original proviso to § 8(3):
10
'on or after the thirtieth day following the beginning of such employment or the effective date of such agreement, whichever is the later * * *. Provided further, That no employer shall justify any discrimination against an employee for non-membership in a labor organization (A) if he has reasonable grounds for believing that such membership was not available to the employee on the same terms and conditions generally applicable to other members, or (B) if he has reasonable grounds for believing that membership was denied or terminated for reasons other than the failure of the employee to tender the periodic dues and the initiation fees uniformly required as a condition of acquiring or retaining membership.' 29 U.S.C. § 158(a)(3).
11
These additions were intended to accomplish twin purposes. On the one hand, the most serious abuses of compulsory unionism were eliminated by abolishing the closed shop. On the other hand, Congress recognized that in the absence of a union-security provision 'many employees sharing the benefits of what unions are able to accomplish by collective bargaining will refuse to pay their share of the cost.' S.Rep.No.105, 80th Cong., 1st Sess., p. 6, 1 Leg.Hist.L.M.R.A. 412. Consequently, under the new law 'employers would still be permitted to enter into agreements requiring all the employees in a given bargaining unit to become members 30 days after being hired,' but 'expulsion from a union cannot be a ground of compulsory discharge if the worker is not delinquent in paying his initiation fee or dues.' S.Rep.No.105, p. 7, 1 Leg.Hist.L.M.R.A. 413. The amendments were intended only to 'remedy the most serious abuses of compulsory union membership and yet give employers and unions who feel that such agreements promoted stability by eliminating 'free riders' the right to continue such arrangements.' Ibid. As far as the federal law was concerned, all employees could be required to pay their way. The bill 'abolishes the closed shop but permits voluntary agreements for requiring such forms of compulsory membership as the union shop or maintenance of membership * * *.' S.Rep.No.105, p. 3, 1 Leg.Hist.L.M.R.A. 409.
12
We find nothing in the legislative history of the Act indicating that Congress intended the amended proviso to § 8(a)(3) to validate only the union shop and simultaneously to abolish, in addition to the closed shop, all other union-security arrangements permissible under state law. There is much to be said for the Board's view that, if Congress desired in the Wagner Act to permit a closed or union shop and in the Taft-Hartley Act the union shop, then it also intended to preserve the status of less vigorous, less compulsory contracts which demanded less adherence to the union.
13
Respondent, however, relies upon the express words of the proviso which allow employment to be conditioned upon 'membership': since the union's proposal here does not require actual membership but demands only initiation fees and monthly dues, it is not saved by the proviso. This position, of course, would reject administrative decisions concerning the scope of § 8(3) of the Wagner Act, e.g., Public Service Co. of Colorado, supra, reaffirmed by the Board under the Taft-Hartley amendments, American Seating Co., 98 N.L.R.B. 800.8 Moreover, the 1947 amendments not only abolished the closed shop but also made significant alterations in the meaning of 'membership' for the purposes of union-security contracts. Under the second proviso to § 8(a)(3), the burdens of membership upon which employment may be conditioned are expressly limited to the payment of initiation fees and monthly dues. It is permissible to condition employment upon membership, but membership, insofar as it has significance to employment rights, may in turn be conditioned only upon payment of fees and dues. 'Membership' as a condition of employment is whittled down to its financial core. This Court has said as much before in Radio Officers' Union v. Labor Board, 347 U.S. 17, 41, 74 S.Ct. 323, 336, 98 L.Ed. 455:
14
'This legislative history clearly indicates that Congress intended to prevent utilization of union security agreements for any purpose other than to compel payment of union dues and fees. Thus Congress recognized the validity of unions' concern about 'free riders,' i.e., employees who receive the benefits of union representation but are unwilling to contribute their fair share of financial support to such union, and gave unions the power to contract to meet that problem while withholding from unions the power to cause the discharge of employees for any other reason. * * *'
15
We are therefore confident that the proposal made by the union here conditioned employment upon the practical equivalent of union 'membership,' as Congress used that term in the proviso to § 8(a)(3).9 The proposal for requiring the payment of dues and fees imposes no burdens not imposed by a permissible union shop contract and compels the performance of only those duties of membership which are enforceable by discharge under a union shop arrangement. If an employee in a union shop unit refuses to respect any union-imposed obligations other than the duty to pay dues and fees, and membership in the union is therefore denied or terminated, the condition of 'membership' for § 8(a)(3) purposes is nevertheless satisfied and the employee may not be discharged for nonmembership even though he is not a formal member.10 Of course, if the union chooses to extend membership even though the employee will meet only the minimum financial burden, and refuses to support or 'join' the union in any other affirmative way, the employee may have to become a 'member' under a union shop contract, in the sense that the union may be able to place him on its rolls.11 The agency shop arrangement proposed here removes that choice from the union and places the option of membership in the employee while still requiring the same monetary support as does the union shop. Such a difference between the union and agency shop may be of great importance in some contexts, but for present purposes it is more formal than real. To the extent that it has any significance at all it serves, rather than violates, the desire of Congress to reduce the evils of compulsory unionism while allowing financial support for the bargaining agent.12
16
In short, the employer categorically refused to bargain with the union over a proposal for an agreement within the proviso to § 8(a)(3) and as such lawful for the purposes of this case. By the same token, § 7, and derivatively § 8(a) (1), cannot be deemed to forbid the employer to enter such agreements, since it too is expressly limited by the § 8(a)(3) proviso. We hold that the employer was not excused from his duty to bargain over the proposal on the theory that his acceding to it would necessarily involve him in an unfair labor practice. Whether a different result obtains in States which have declared such arrangements unlawful is an issue still to be resolved in Retail Clerks Ass'n v. Schermerhorn, 373 U.S. 746, 83 S.Ct. 1461, and one which is of no relevance here because Indiana law does not forbid the present contract proposal. In the context of this case, then, the employer cannot justify his refusal to bargain. He violated § 8(a)(5), and the Board properly ordered him to return to the bargaining table.
17
Reversed and remanded.
18
Mr. Justice GOLDBERG took no part in the consideration or decision of this case.
1
'SEC. 8. (a) It shall be an unfair labor practice for an employer—
'(5) to refuse to bargain collectively with the representatives of his employees, subject to the provisions of section 9(a).'
2
'SEC. 8. (a) It shall be an unfair labor practice for an employer—
'(3) by discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization: Provided, That nothing in this Act, or in any other statute of the United States, shall preclude an employer from making an agreement with a labor organization * * * to require as a condition of employment membership therein on or after the thirtieth day following the beginning of such employment or the effective date of such agreement, whichever is the later * * *.'
3
'Union Security and Check-Off of Union Membership Dues
'(4) An employe who is a member of the Union at the time this Agreement becomes effective shall continue membership in the Union for the duration of this Agreement to the extent of paying an initiation fee and the membership dues uniformly required as a condition of acquiring or retaining membership in the Union.
'(4a) An employe who is not a member of the Union at the time this Agreement becomes effective shall become a member of the Union within 60 days after the thirtieth (30th) day following the effective date of this Agreement or within 60 days after the thirtieth (30th) day following employment, whichever is later, and shall remain a member of Union, to the extent of paying an initiation fee and the membership dues uniformly required as a condition of acquiring or retaining membership in the Union, whenever employed under, and for the duration of, this Agreement.
'(4b) Anything herein to the contrary notwithstanding, an employe shall not be required to become a member of, or continue membership in, the Union, as a condition of employment, if employed in any state which prohibits, or otherwise makes unlawful, membership in a labor organization as a condition of employment.
'(4c) The Union shall accept into membership each employe covered by this Agreement who tenders to the Union the periodic dues and initiation fees uniformly required as a condition of acquiring or retaining membership in the Union.
'(4f) 'Member of the Union' as used in paragraphs (4) and (4a) above means any employe who is a member of the Union and is not more than sixty (60) days in arrears in the payment of membership dues.'
4
The union's vice-president so explained the union proposal, and the Board seems to have accepted this view. 133 N.L.R.B. 451, at 456, n. 12.
5
The Board also held that respondent's refusal to bargain interfered with, restrained, and coerced its employees in the exercise of their National Labor Relations Act § 7 rights, contrary to National Labor Relations Act § 8(a)(1).
6
See, e.g., M. & J. Tracy, Inc., 12 N.L.R.B. 916, 931—934; J. E. Pearce Contracting & Stevedoring Co., Inc., 20 N.L.R.B. 1061, 1070—1073. And see the memorandum printed by the Senate committee, commenting upon the final bill, which indicated that the exemption of the proviso was not limited to the closed or union shop:
'Unless this change is made as provided in S.1958, most strikes for a closed shop or even for a preferential shop would by this act be declared to be for an illegal purpose. * * *
'As the legislative history of (N.I.R.A. s) 7(a) demonstrates, nothing in that section was intended to deprive labor of its existing rights in many States to contract or strike for a closed or preferential shop * * *. No reason appears for a contrary view here.' 1 Leg.Dist.N.L.R.A. 1354—1355.
7
This case was decided in 1950, but it was governed by the Wagner Act because the agreement was covered by the saving clause in the Labor Management Relations Act, § 102, 89 N.L.R.B., at 419 420.
8
In that case, the Board stated:
'As to the requirement in paragraph 4 that religious objectors who do not become members pay to the Intervenor sums equivalent to dues, the Board has ruled that closed-shop agreements providing for 'support money' payments did not violate the proviso to Section 8(3) of the Wagner Act. As the precise language of the 8(3) proviso in the Wagner Act was continued in the amended Act with certain added qualifications not pertinent here, and because the legislative history of the amended Act indicates that Congress intended not to illegalize the practice of obtaining support payments from nonunion members who would otherwise be 'free riders,' we find that the provision for support payments in the instant contract does not exceed the union-security agreements authorized by the Act.' 98 N.L.R.B., at 802.
9
Referring to the Canadian practice, Senator Taft stated that the rule adopted by the Conference Committee 'is substantially the rule now in effect in Canada' which is that 'the employee must, nevertheless, pay dues, even though he does not join the union' and that if he pays the dues without joining he has the right to be employed. 93 Cong.Rec. 4887, 2 Leg.Hist.L.R.M.A. 1422.
10
Union Starch & Ref. Co. v. Labor Board, 186 F.2d 1008 (C.A.7th Cir.). See also Labor Board v. Food Fair Stores, 307 F.2d 3 (C.A.3d Cir.); Labor Board v. Local 815, International Brotherhood of Teamsters, 290 F.2d 99 (C.A.2d Cir.); Labor Board v. Local 450, International Union of Operating Engineers, 281 F.2d 313, 316—317 (C.A.5th Cir.); N.L.R.B. v. National Automotive Fibres, Inc., 277 F.2d 779 (C.A.9th Cir.); Labor Board v. Die & Tool Makers Lodge, 231 F.2d 298 (C.A.7th Cir.); Labor Board v. Mechanics Educational Society of America, 222 F.2d 429 (C.A.6th Cir.); Labor Board v. Pape Broadcasting Co., 217 F.2d 197 (C.A.5th Cir.); Labor Board v. Philadelphia Iron Works, 211 F.2d 937 (C.A.3d Cir.); Labor Board v. Eclipse Lumber Co., 199 F.2d 684 (C.A.9th Cir.); Utley Company, 108 N.L.R.B. 295, enforced, 217 F.2d 885 (C.A.6th Cir.); Washington Waterfront Employers, 98 N.L.R.B. 284, enforced, 211 F.2d 946 (C.A.9th Cir.); Electric Auto-Lite Co., 92 N.L.R.B. 1073, enforced, 196 F.2d 500 (C.A.6th Cir.).
11
Cf. American Seating Co., 98 N.L.R.B. 800, 802, quoted supra, note 8, approving a provision protecting those who object on conscientious grounds from being required to become 'members' in the conventional sense of that term.
12
Also wide of the mark is respondent's further suggestion that Congress contemplated the obligation to pay fees and dues to be imposed only in connection with actual membership in the union, so as to insure the enjoyment of all union benefits and rights by those from whom money is extracted. Congress, it is said, had no desire to open the door to compulsory contracts which extract money but exclude the contributing employees from union membership. But, as analyzed by the Board and as the case comes to us, there is no closed-union asspect to the present proposal by the union. Membership remains optional with the employee and the significance of desired, but unavailable, union membership, or the benefits of membership, in terms of permissible § 8(a)(3) security contracts, we leave for another case. In view of the legislative history of the Taft-Hartley amendments to § 8(a)(3) and of their purposes, we cannot say that optional membership, which is neither compulsory nor unavailable membership, vitiates an otherwise valid union-security arrangement.
| 67
|
374 U.S. 101
83 S.Ct. 1686
10 L.Ed.2d 1026
Michele MARCHESEv.UNITED STATES et al.
No. 362.
Supreme Court of the United States
June 10, 1963
Russell E. Parsons and Sol C. Berenholtz, for petitioner.
Solicitor General Cox, Assistant Attorney General Miller and Philip R. Monahan, for the United States and others.
On Petition for Writ of Certiorari to the United States Court of Appeals for the Ninth Circuit.
PER CURIAM.
1
The petition for writ of certiorari is granted, the judgment is vacated and the case is remanded to the United States District Court for the Southern District of California for reconsideration in light of Sanders v. United States, 373 U.S. 1, 83 S.Ct. 1068.
2
Mr. Justice CLARK and Mr. Justice HARLAN would deny certiorari on the basis of their dissent in Sanders v. United States, 373 U.S. 23, 83 S.Ct. 1081.
| 01
|
374 U.S. 84
83 S.Ct. 1651
10 L.Ed.2d 770
UNITED STATES, Petitioner,v.PIONEER AMERICAN INSURANCE COMPANY et al.
No. 405.
Argued April 17, 1963.
Decided June 10, 1963.
Richard M. Roberts, Washington, D.C., for petitioner.
Owen C. Pearce, Fort Smith, Ark., for respondents.
Mr. Justice WHITE delivered the opinion of the Court.
1
The United States has sought review of a decision of the Supreme Court of Arkansas subordinating the federal tax lien (26 U.S.C. § 6321) to a lien for attorney's fees included in an antecedent mortgage contract. 235 Ark. 267, 357 S.W.id 653. Because of conflict between the Arkansas decision and United States v. Bond, 279 F.2d 837 (C.A.4th Cir.); In re New Haven Clock & Watch Co., 253 F.2d 577 (C.A.2d Cir.), we granted certiorari, 371 U.S. 909, 83 S.Ct. 254, 9 L.Ed.2d 169.
2
When the taxpayers in 1958 acquired their interest in the parcel of real estate involved here, they assumed liability on a note and the deed of trust (first mortgage) securing it, which were held by respondent Pioneer American Insurance Company. The note obligated taxpayers 'in the event of default herein and of the placing of this note in the hands of an attorney for collection, or this note is collected through any court proceedings, to pay a reasonable attorney's fee.'1 The taxpayers at the same time executed a note and second mortgage to their vendor, respondent The Development Company, and subsequently, in April 1960, the real estate became burdened again with a mechanic's lien in favor of Alfred J. Anderson.
3
In October of 1960, taxpayers defaulted on the first mortgage monthly installment and failed thereafter to meet payments as they fell due. On March 24, 1961, Pioneer American filed a suit to foreclose its mortgage and sought, in addition to the principal and interest, a reasonable attorney's fee. The United States was named a party defendant because of two outstanding federal tax liens against the taxpayers which were filed on November 29, 1960, and January 30, 1961. The United States admitted its liens were subordinate to the principal and interest on the first and second mortgages but claimed that the liens were superior to the claim for the attorney's fee. Three additional federal tax liens subsequently were filed on April 14, July 17, and October 3, 1961.2
4
On November 15, 1961, the Chancery Court entered its decree of foreclosure which fixed the attorney's fee at $1,250 and determined the priority of the various claimants. After satisfaction of court and foreclosure sale costs, Pioneer American was accorded first priority for principal, interdst and the attorney's fee; the Development Company took next on principal and interest under the second mortgage; Alfred J. Anderson shared thereafter on his mechanic's lien and the United States took last. The property was sold and proceeds were received which satisfied all claims except $3,615.28 of the federal tax liens.3 The United States appealed to the Supreme Court of Arkansas asserting that it was entitled to priority over the attorney's fees,4 and that $1,250 more should have been applied to reduce the unpaid federal taxes.5 With one judge dissenting, the Arkansas court rejected that contention and sustained the superiority of the claim for the attorney's fee.
5
It goes unchallenged that the claim for the attorney's fee, arising out of the obligations assumed by the taxpayer in 1958, became enforceable under Arkansas law as a contract of indemnity at the time of default in October 1960 before the filing of the first federal tax liens. Furthermore, it is evidence that the suit in which this attorney's fee was earned was commenced on March 24, 1961, prior to the filing of the unpaid federal tax liens crucial to this suit, i.e., the liens of April 14, July 17, and October 3, 1961. Nevertheless, because this fee had not been incurred and paid and could not be finally fixed in amount until November 15, 1961, after all the federal liens had been filed, we hold that the claim for attorney's fees remained inchoate at least until that date and that the federal tax liens are entitled to priority.
6
The priority of the federal tax lien provided by 26 U.S.C. § 6321 as against liens created under state law is governed by the common-law rule—'the first in time is the first in right.' United States v. New Britain, 347 U.S. 81, 85—86, 74 S.Ct. 367, 370, 98 L.Ed. 520. It is critical, therefore, to determine when competing liens, whether federal- or state-created, come into existence or become valid for the purpose of the rule.
7
The tax lien arises, according to § 6322, when the tax is assessed, but as against the specific interests mentioned in § 6323(a)—mortgagees, pledgees, purchasers and judgment creditors—it is not valid until placed of public record, and insofar as the federal lien attaches to securities, mortgagees, pledgess and purchasers must have actual notice of the lien.6 § 6323(c).
8
As for a lien created by state law, its priority depends 'on the time it attached to the property in question and became choate.' United States v. New Britain, supra, 347 U.S. at 86, 74 S.Ct. at 370; United States v. Security Trust & Savings Bank, 340 U.S. 47, 71 S.Ct. 111, 95 L.Ed. 53. Choate state-created liens take priority over later federal tax liens, United States v. New Britain, supra; Crest Finance Co. v. United States, 368 U.S. 347, 82 S.Ct. 384, 7 L.Ed.2d 342, while inchoate liens do not. See United States v. Liverpool & London Ins. Co., 348 U.S. 215, 75 S.Ct. 247, 99 L.Ed. 268; United States v. Scovil, 348 U.S. 218, 75 S.Ct. 244, 99 L.Ed. 271; United States v. Colotta, 350 U.S. 808, 76 S.Ct. 82, 100 L.Ed. 725. And it is a matter of federal law when such a lien has acquired sufficient substance and has become so perfected as to defeat a later-arising or later-filed federal tax lien.7 'Otherwise, a State could affect the standing of federal liens, contrary to the established doctrine, simply by causing an inchoate lien to attach at some arbitrary time even before the amount of the tax, assessment, etc., is determined.' United States v. New Britain, supra, 347 U.S. at 86, 74 S.Ct. at 371. The federal rule is that liens are 'perfected in the sense that there is nothing more to be done to have a choate lien—when the identity of the lienor, the property subject to the lien, and the amount of the lien are established.' Id., 347 U.S. at 84, 74 S.Ct. at 369.
9
We reject respondents' contention that the choateness rule has no place when a mortgage under § 6323(a) is involved. The predecessor to § 6323 was first enacted by Congress in 1912 in order to protect mortgagees, purchasers and judgment creditors against a secret lien for assessed taxes and to postpone the effectiveness of the tax lien as against these interests until the tax lien was filed. H.R.Rep.No. 1018, 62d Cong., 2d Sess. The section dealt with the federal lien only and it did not purport to affect the time at which local liens were deemed to arise or to become choate or to subordinate the tax lien to tentative, conditional or imperfect state liens. Rather, we believe Congress intended that it out of the whole spectrum of state-created liens, certain liens are to enjoy the preferred status granted by § 6323, they should at least have attained the degree of perfection required of other liens and be choate for the purposes of the federal rule.
10
The Court has never held that mortgagees face a less demanding test of perfection than other interests when competing with the federal lien. Indeed United States v. R. F. Ball Constr. Co., 355 U.S. 587, 78 S.Ct. 442, 2 L.Ed.2d 510, stands for just the contrary. There the state law creditor, asserting that the assignment under which he claimed was a mortgage within the predecessor to § 6323, insisted upon priority over the federal lien by virtue of the previously executed assignment. A majority of the Court, although not expressly declaring the assignment to be a mortgage, held that § 6323(a) afforded the creditor no protection since his interest was 'inchoate and unperfected.' The four dissenters thought the assignment was a mortgage and that it was 'completely perfected' and 'in all respects choate.' While disagreeing on the choateness of the particular assignment involved there, the Court was unanimous in applying the choateness test to those seeking the protection of § 6323(a). We follow that lead here and therefore proceed to measure against the rule the choateness of the mortgagee's lien for reasonable attorney's fees before us.
11
Clearly the identity of the lienholder and the property subject to the lien are definite here, but it is equally apparent that the amount of the lien for attorney's fees was undetermined and indefinite when the federal tax liens in question were filed.8 The mortgage held by respondents secured a promissory note which obligated the mortgagor maker to pay a 'reasonable attorney's fee' 'in the event of default' and 'of the placing of this note in the hands of an attorney for collection.' By the time the federal liens subordinated by the Arkansas courts were placed of public record, default has occurred, the mortgagee had elected to declare the note due and payable, an attorney had been engaged and a suit to foreclose the mortgage had been filed. But the 'reasonable attorney's fee'—reasonable in relation to the service to be performed by the attorney—had not been reduced to a liquidated amount. The final amount was to be established by court decree and the Chancery Court set the fee considerably below the sum requested. Moreover, there is no showing in this record that the mortgagee had become obligated to pay and had paid any sum of money for services performed prior to the filing of the federal tax lien.
12
Ball once again provides a parallel. Sums due the contractor-taxpayer under a particular construction contract were assigned to the surety as security for any future indebtedness of the contractor to the surety arising under that contract or any other. After the filing of the federal tax lien against the contractor, the surety made advances to complete another contract of the taxpayer, as the surety was obligated to do under its bond issued on that contract, and the taxpayer thereby became indebted to the surety. The majority held the surety's interest 'inchoate and unperfected' at the time of the filing of the federal tax liens.9 Ball therefore rejects as inchoate an assignee's or mortgagee's lien to secure future indebtedness of the taxpayer-debtor. The creditor holds merely 'a caveat of a more perfect lien to come.' New York v. Maclay, 288 U.S. 290, 294, 53 S.Ct. 323, 324, 77 L.Ed. 754. Likewise, when a mortgagee has a lien for an attorney's fee which is uncertain in amount and yet to be incurred and paid, such a lien is inchoate and is subordinate to the intervening federal tax lien filed before the mortgagee's lien for the attorney's fee matures.10
13
But, it is said, the principal and interest of the mortgage were definite in amount, the attorney's fee later became certain by court order11 and if the tax lien were to prevail the preference of the mortgagee given by § 6323 will be frustrated since payment of the attorney's fee will reduce the net amount realized from the mortgage. Aside from the fact that the mortgagee here will experience no such reduction,12 this argument would subordinate federal tax liens to inchoate liens and in both United States v. New Britain, supra, and United States v. Buffalo Savings Bank, 371 U.S. 228, 83 S.Ct. 314, 9 L.Ed.2d 283, the Court denied priority to local tax liens which were imperfect when the federal tax lien was filed even though the former had priority over the mortgage and would reduce the recovery of the mortgagee.13
14
The court below was in error and its judgment is reversed and the cause remanded for further proceedings not inconsistent with this opinion.
15
Reversed and remanded.
16
Mr. Justice DOUGLAS dissents.
1
The deed of trust provided, in addition:
'That if either the party of the second part (trustee) or the party of the first part (mortgagor) shall become a party to any suit or proceeding at law or in equity in reference to its interest in the premises herein conveyed, the reasonable costs, charges and attorney's fees in such suit or proceeding shall be added to the principal sum then owing by the party of the first part and shall be secured by this instrument, and the note secured hereby shall, at the option of the holder, become due and collectible.
'The proceeds of any sale under this deed of trust shall be applied * * * as follows:
'First: To pay the costs and expenses of executing this trust, and any and all sums expended on account of costs of litigation, attorney's fees, ground rents, taxes, insurance premiums, or any advances made or expenses incurred on account of the property sold, with interest thereon.
'Second: To retain as compensation, a commission as set forth by the laws of the State of Arkansas.
'Third: To pay off the debt secured hereby, including accrued interest thereon, as well as any other sums owing * * * pursuant to this instrument.'
2
The federal tax liens, as of the date of the order of distribution, November 15, 1961, were as follows:
3
The first two liens, November 29, 1960, and January 30, 1961, were satisfied in full. $546.68 was available for partial payment of the April 14, 1961, lien. The balance of the April lien and the full amounts of the July 17 and October 3, 1961, liens remained unsatisfied.
4
The United States did not challenge the priority of the mechanic's lien or of any other distribution fixed by the decree.
5
Once the attorney's fee is subordinated to the federal tax liens, the $1,250 would be borne by the other claimants in order of seniority among themselves under state law. On the basis of the present decree, the share of the mechanic's lienor Anderson would be eliminated and that of the second mortgagee, The Development Company, reduced by half.
6
'While it is true that the filing of the notice of the tax lien may constitute notice in the case of real property, it is inequitable for the statute to provide that it constitutes notice as regards securities. For example, when a broker purchases a security for his customer on the exchange, it is obviously impossible for him to check all the offices in which a notice of the tax lien may be duly filed to determine whether the security is subject to such lien. A like situation exists with respect to over-the-counter and direct transactions in securities. An attempt to enforce such liens on recorded notice would in many cases impair the negotiability of securities and seriously interfere with business transactions. The adoption of the amendment will remove an existing hardship without causing any undue loss of revenue.' H.R.Rep. No. 855, 76th Cong., 1st Sess. 26 (1939).
7
'The effect of a lien in relation to a provision of federal law for the collection of debts owing the United States is always a federal question. Hence, although a state court's classification of a lien as specific and perfected is entitled to weight, it is subject to reexamination by this Court.' United States v. Security Trust & Sav. Bank, 340 U.S. 47, 49—50, 71 S.Ct. 111, 95 L.Ed. 53; see also, United States v. Acri, 348 U.S. 211, 75 S.Ct. 239, 99 L.Ed. 264; United States v. Vorreiter, 355 U.S. 15, 78 S.Ct. 19, 2 L.Ed.2d 23. Thus the fact that, under Arkansas law, the claim for attorney's fees becomes enforceable upon default as a contract of indemnity does not foreclose inquiry by this Court into the degree the claim is choate at that time.
8
There is nothing in Security Mortgage Co. v. Powers, 278 U.S. 149, 49 S.Ct. 84, 73 L.Ed. 236, which compels us to hold the lien choate, since the issue there was the status of an attorney's fee clause, fixed in amount, in bankruptcy proceedings where the rigorous federal lien choateness test was not necessarily applicable.
9
Contrast Crest Finance Co. v. United States, 368 U.S. 347, 82 S.Ct. 384, 7 L.Ed.2d 342, where the assignment and the loans were consummated prior to the accrual and filing of the federal tax liens.
10
See in accord, with respect to attorney's fees, United States v. Bond, 279 F.2d 837 (C.A.4th Cir.); In re New Haven Clock & Watch Co., 253 F.2d 577 (C.A.2d Cir.); Bank of America National Trust & Savings Ass'n v. Embry, 188 Cal.App.2d 425, 10 Cal.Rptr. 602; with respect to payments of subsequently attaching local taxes, United States v. Bond, supra; United States v. Christensen, 269 F.2d 624 (C.A.9th Cir.); and with respect to future advance clause transactions, American Surety Co. v. Sundberg, 58 Wash.2d 337, 363 P.2d 99; Rev.Rule 56—41, 1956—1 Cum.Bull. 562; cf. United States v. Peoples Bank, 197 F.2d 898 (C.A.5th Cir.); Hoare v. United States, 294 F.2d 823 (C.A.9th Cir.).
11
This argument would require us to revitalize the long since rejected relationback doctrine. See United States v. Security Trust & Sav. Bank, 340 U.S. 47, 50, 71 S.Ct. 111, 113, 95 L.Ed. 53.
12
See note 5, supra
13
By the same token respondents' contention that the rules against 'unjust enrichment' are violated by preferring the tax lien to the claim for attorney's fees is without merit. Both New Britain and Buffalo Savings Bank prefer the federal lien even though the mortgagee's interest in the proceeds will be reduced by later-arising local taxes having priority under state law over the mortgagee. The attorney's services, moreover, were rendered for the benefit of the mortgagee to protect his interest in the property, and the United States, holding an adverse interest, received no such benefit from them that its interest is to be charged therefor.
| 1112
|
374 U.S. 65
83 S.Ct. 1663
10 L.Ed.2d 757
Benjamin BRAUNSTEIN et al., Petitioners,v.COMMISSIONER OF INTERNAL REVENUE.
No. 476.
Argued April 29, 1963.
Decided June 10, 1963.
Louis Eisenstein, Washington, D.C., for petitioners.
Wayne G. Barnett, Washington, D.C., for respondent.
Mr. Justice HARLAN delivered the opinion of the Court.
1
This case involves the applicability of the 'collapsible corporation' provisions of the federal income tax laws which, during the period relevant here, were set forth in s 117(m) of the Internal Revenue Code of 1939.1 These provisions require that under certain circumstances, gain from the sale of stock which would otherwise be considered as long-term capital gain, and accordingly taxed at a maximum rate of 25%, must be reported as ordinary income.
2
The three taxpayers who are petitioners here became associated in 1938 and have since participated in a number of construction projects, usually through corporations in which the stock was equally divided.2 In 1948 the petitioners received a commitment from the Federal Housing Administration to insure loans for the construction of a multiple-dwelling apartment project in Queens County, New York. Two corporations were formed to carry out this project, and each petitioner was issued one-third of the stock in each corporation. After the costs of construction had been paid, the corporations each had an unused amount of mortgage loan funds remaining, and in 1950 the petitioners sold their stock at a profit, receiving as part of the sale transaction distributions from the corporations which included the unused funds. The petitioners reported the excess of the amounts received over their bases in the stock as long-term capital gains of $313,854.17 each.3
3
The Commissioner asserted a deficiency, treating the gain as ordinary income on the ground that the corporations were 'collapsible' within the meaning of § 117(m). The Tax Court sustained the Commissioner, 36 T.C. 22, and the Court of Appeals affirmed the Tax Court, 305 F.2d 949, holding that (1) the taxpayers had the requisite 'view' during construction of the property (see note 1, supra); (2) more than 70% of the gain realized by the taxpayers was attributable to the constructed property (id.); and (3) § 117(m) applies even if the constructed buildings would have produced capital gain on a sale by the taxpayers had no corporations been formed. This last holding was in response to an argument by the taxpayers based on a theory similar to that adopted by the Court of Appeals for the Fifth Circuit in United States v. Ivey, 294 F.2d 799. In view of the conflict between the decision below and that in Ivey on this point, we granted certiorari, 371 U.S. 933, 82 S.Ct. 306, 9 L.Ed.2d 270, stating that the grant was limited to the following question:
4
"Whether Section 117(m) of the Internal Revenue Code of 1939 (26 U.S.C.A. § 117(m)), which provides that gain 'from the sale or exchange * * * of stock of a collapsible corporation' is taxable as ordinary income rather than capital gain, is inapplicable in circumstances where the stockholders would have been entitled to capital-gains treatment had they conducted the enterprise in their individual capacities without utilizing a corporation."
5
Briefly summarized, petitioners' argument runs as follows: As the legislative history shows, the collapsible corporation provisions of the code were designed to close a loophole through which some persons had been able to convert ordinary income into long-term capital gain by use of the corporate form. For example, in the case of in individual who constructed a property which he held primarily for sale to customers in the ordinary course of his trade or business, any gain from the sale of the asset would be ordinary income;4 but if that same individual were to form a corporation to construct the property, intending to sell his stock on the completion of construction, it was at least arguable prior to the enactment of § 117(m) that the proceeds of the ultimate sale of the stock were entitled to capital-gains treatment. It was this and similar devices that § 117(m) was designed to frustrate, but it was not intended to have the inequitable effect of converting into ordinary income what would properly have been a capital gain prior to its enactment even in the absence of any corporate form. Thus, it is argued, the phrase 'gain attributable to such property,' as used in § 117(m), must apply only to profit that would have constituted ordinary income if a corporation had not been utilized, for only in such cases is the corporation made to serve as a device for tax avoidance. In the present case, neither the corporation nor the individual petitioners were in the trade or business of selling apartment buildings, and thus the corporations were not used to convert ordinary income into capital gain and the provisions of § 117(m) are inapplicable.5
6
We have concluded that petitioners' contentions must be rejected. Their argument is wholly inconsistent with the plain meaning of the language of § 117(m), and we find nothing in the purpose of the statute, as indicated by its legislative history, to warrant any departure from that meaning in this case.
I.
7
As to the language used, § 117(m) defines a collapsible corporation as embracing one formed or availed of principally for the manufacture, construction, or production of property with a view to (1) the sale or exchange of stock prior to the realization by the corporation of a substantial part of the net income from the property and (2) the realization 'of gain attributable to such property.' The section is then expressly made inapplicable to gain realized during any year 'unless more than 70 per centum of such gain is attributable to the property so manufactured, constructed, or produced.' If used in their ordinary meaning, the word 'gain' in these contexts simply refers to the excess of proceeds over cost or basis, and the phrase 'attributable to' merely confines consideration to that gain caused or generated by the property in question. With these definitions, the section makes eminent sense, since the terms operate to limit its application to cases in which the corporation was availed of with a view to profiting from the constructed property by a sale or exchange of stock soon after completion of construction and in which a substantial part of the profit from the sale or exchange of stock in a given year was in fact generated by such property.
8
There is nothing in the language or structure of the section to demand or even justify reading into these provisions the additional requirement that the taxpayer must in fact have been using the corporate form as a device to convert ordinary income into capital gain. If a corporation owns but one asset, and the shareholders sell their stock at a profit resulting from an increase in the value of the asset, they have 'gain attributable to' that asset in the natural meaning of the phrase regardless of their desire, or lack of desire, to avoid the bite of federal income taxes.
II.
9
Nor is there anything in the legislative history that would lead us to depart from the plain meaning of the statute as petitioners would have us do. There can of course be no question that the purpose of § 117(m) was, as petitioners contend, to close a loophole that Congress feared could be used to convert ordinary income into capital gain. See H.R.Rep.No.2319, 81st Cong., 2d Sess.; S.Rep.No.2375, 81st Cong., 2d Sess., U.S.Code Congressional Service 1950, p. 3053. But the crucial point for present purposes is that the method chosen to close this loophole was to establish a carefully and elaborately defined category of transactions in which what might otherwise be a capital gain would have to be treated as ordinary income. There is no indication whatever of any congressional desire to have the Commissioner or the courts make a determination in each case as to whether the use of the corporation was for tax avoidance. Indeed, the drawing of certain arbitrary lines not here involved—such as making the section inapplicable to any shareholder owning 10% or less of the stock or to any gain realized more than three years after the completion of construction—tends to refute any such indication. It is our understanding, in other words, that Congress intended to define what it believed to be a tax avoidance device rather than to leave the presence or absence of tax avoidance elements for decision on a case-to-case basis.
10
We are reinforced in this conclusion by the practical difficulties—indeed the impossibilities—of considering without more legislative guidance than is furnished by § 117(m) whether there has in fact been 'conversion' of ordinary income into capital gains in a particular case. For example, if we were to inquire whether or not the profit would have been ordinary income had an enterprise been individually owned, would we treat each taxpaying shareholder differently and look only to his trade or business or would we consider the matter in terms of the trade or business of any or at least a substantial number of the shareholders? There is simply no basis in the statute for a judicial resolution of this question, and indeed when Congress addressed itself to the problem in 1958, it approved an intricate formulation falling between these two extremes.6
11
As a further example, what if the individual in question is not himself engaged in any trade or business but owns stock in varying amounts in a number of corporate ventures other than the one before the court? Do we pierce each of the corporate veils, regardless of the extent and share of the individual's investment, and charge him with being in the trade or business of each such corporation? Again, there is no basis for a rational judicial answer; the judgment is essentially a legislative one and in the 1958 amendments Congress enacted a specific provision, designed to deal with this matter, that is far too complex to be summarized here.7
12
These examples should suffice to demonstrate the point: The question whether there has in fact been a 'conversion' of ordinary income in a particular case is far easier to state than to answer, and involves a number of thorny issues that may not appear on the surface.8 We find no basis in either the terms or the history of § 117(m) for concluding that Congress intended the Commissioner and the courts to enter this thicket and to arrive at ad hoc determinations for every taxpayer. Accordingly, the judgments below must be affirmed.
13
Affirmed.
14
Mr. Justice DOUGLAS dissents.
1
Section 117(m) was added to the Internal Revenue Code of 1939 by the Revenue Act of 1950, § 212(a), 64 Stat. 934. The section was amended by the Revenue Act of 1951, § 326, 65 Stat. 502. It was reenacted without substantial change as § 341 of the Internal Revenue Code of 1954, 68A Stat. 107, and was amended by the Technical Amendments Act of 1958, § 20(a), 72 Stat. 1615, and by the Act of October 16, 1962, § 13(f)(4), 76 Stat. 1035. As originally enacted, and during the period relevant here, it provided:
'(1) Treatment of gain to shareholders. Gain from the sale or exchange (whether in liquidation or otherwise) of stock of a collapsible corporation, to the extent that it would be considered (but for the provisions of this subsection) as gain from the sale or exchange of a capital asset held for more than 6 months, shall, except as provided in paragraph (3), be considered as gain from the sale or exchange of property which is not a capital asset.
'(2) Definitions.
'(A) For the purposes of this subsection, the term 'collapsible corporation' means a corporation formed or availed of principally for the manufacture, construction, or production of property, or for the holding of stock in a corporation so formed or availed of, with a view to—
'(i) the sale or exchange of stock by its shareholders (whether in liquidation or otherwise), or a distribution to its shareholders, prior to the realization by the corporation manufacturing, constructing, or producing the property of a substantial part of the net income to be derived from such property, and
'(ii) the realization by such shareholders of gain attributable to such property.
'(3) Limitations on application of subsection. In the case of gain realized by a shareholder upon his stock in a collapsible corporation—
'(A) this subsection shall not apply unless, at any time after the commencement of the manufacture, construction, or production of the property, such shareholder (i) owned (or was considered as owning) more than 10 per centum in value of the outstanding stock of the corporation, or (ii) owned stock which was considered as owned at such time by another shareholder who then owned (or was considered as owning) more than 10 per centum in value of the outstanding stock of the corporation;
'(B) this subsection shall not apply to the gain recognized during a taxable year unless more than 70 per centum of such gain is attributable to the property so manufactured, constructed, or produced; and
'(C) this subsection shall not apply to gain realized after the expiration of three years following the completion of such manufacture, construction, or production. * * *'
2
Petitioners Benjamin and Harry Neisloss are builders; petitioner Braunstein, an architect. Their wives are parties only by virtue of the filing of joint returns.
3
The parties have agreed that the distributions from the corporations and the amounts received directly from the buyers of the stock may be considered together, as if the entire amount had been received from the buyers.
4
Int.Rev.Code, 1939, § 117(a)(1)(A).
5
The Government has assumed for purposes of its argument here, but does not concede, that petitioners would have been entitled to capital-gains treatment had they conducted the enterprise without utilizing a corporation.
6
Int.Rev.Code, 1954, § 341(e), added by the Technical Amendments Act of 1958, § 20(a), 72 Stat. 1615.
7
Int.Rev.Code, 1954, § 341(e)(1)(C).
8
The Government has emphasized in its argument here that the present case involves a particularly 'blatant' conversion of ordinary income because by charging the corporations only for the out-of-pocket costs of construction 'petitioners contributed their services to create a valuable property for the corporation(s) and then realized upon that value by selling their stock.' Thus, the Government concludes the petitioners claim as capital gain 'what ought to have been (and, in an arm's-length transaction, would have been) taxed as compensation for services.'
| 1112
|
374 U.S. 74
83 S.Ct. 1657
10 L.Ed.2d 763
DIVISION 1287 OF the AMALGAMATED ASSOCIATION OF STREET, ELECTRIC RAILWAY AND MOTOR COACH EMPLOYEES OF AMERICA et al., Appellants,v.STATE OF MISSOURI.
No. 604.
Argued April 24 and 25, 1963.
Decided June 10, 1963.
Bernard Dunau, Washington, D.C., for appellants.
Joseph Nessenfeld, St. Louis, Mo., for appellee.
Opinion of the Court by Mr. Justice STEWART, announced by Mr. Justice WHITE.
1
The appellant union is the certified representative of a majority of the employees of Kansas City Transit, Inc., a Missouri corporation which operates a public transit business in Kansas and Missouri. A collective bargaining agreement between the appellant and the company was due to expire on October 31, 1961, and in August of that year, after appropriate notices, the parties commenced the negotiation of an amended agreement. An impasse in these negotiations was reached, and in early November the appellant's members voted to strike. The strike was called on November 13.
2
The same day the Governor of Missouri acting under the authority of a state law known as the King-Thompson Act,1 issued a proclamation that the public interest, health and welfare were jeopardized by the threatened interruption of the company's operations, and by an executive order purported to take possession 'of the plants, equipment, and all facilities of the Kansas City Transit, Inc., located in the State of Missouri, for the use and operation by the State of Missouri in the public interest.' A second executive order provided in part that 'All rules and regulations * * * governing the internal management and organization of the company, and its duties and responsibilities, shall remain in force and effect throughout the term of operation by the State of Missouri.'
3
Pursuant to a provision of the Act which makes unlawful any strike or concerted refusal to work as a means of enforcing demands against the utility or the State after possession has been taken by the State, the State petitioned the Circuit Court of Jackson County for an injunction on November 15, 1961.2 A temporary restraining order was issued on that day, and the strike and picketing were discontinued that evening. After a two-day trial, the order was continued in effect, and the Circuit Court later entered a permanent injunction barring the continuation of the strike 'against the State of Missouri.' On appeal to the Supreme Court of Missouri, the appellants argued that the King-Thompson Act is in conflict with and is pre-empted by federal labor legislation, and that it abridges rights guaranteed by the First, Thirteenth, and Fourteenth Amendments. Reaffirming its earlier decisions in cases arising under the Act,3 the Supreme Court of Missouri rejected these arguments and affirmed the issuance of the injunction. 361 S.W.2d 33. We noted probable jurisdiction. 371 U.S. 961, 83 S.Ct. 541, 9 L.Ed.2d 509.
4
We are met at the threshold with the claim that this controversy has become moot, and that we are accordingly foreclosed from considering the merits of the appeal. The basis for this contention is the fact that, after the appellants' jurisdictional statement was filed in this Court, the Governor of Missouri issued an executive order which, although reciting that the labor dispute between Kansas City Transit, Inc., and the appellant union 'remains unresolved,' nevertheless terminated the outstanding seizure order, upon the finding that 'continued exercise by me of such authority is not justified in the circumstances of the aforesaid labor dispute.' Reliance for the claim of mootness is placed upon this Court's decisions in Harris v. Battle, 348 U.S. 803, 75 S.Ct. 34, 99 L.Ed. 634, and Local No. 8—6, Oil, Chemical and Atomic Workers International Union, AFL-CIO v. Missouri, 361 U.S. 363, 80 S.Ct. 391, 4 L.Ed.2d 373. In the Oil Workers case the Court declined to consider constitutional challenges to the King-Thompson Act, and in the Harris case declined to rule on the constitutionality of a similar Virginia statute, on the ground that the controversies had become moot. In both of those cases, however, the underlying labor dispute had been settled and new collective bargaining agreements concluded by the time the litigation reached this Court. Here, by contrast, the labor dispute remains unresolved. There thus exists in the present case not merely the speculative possibility of invocation of the King-Thompson Act in some future labor dispute, but the presence of an existing unresolved dispute which continues subject to all the provisions of the Act. Cf. Southern Pac. Terminal Co. v. Interstate Commerce Comm., 219 U.S. 498, 514—516, 31 S.Ct. 279, 283—284, 55 L.Ed. 310; United States v. W. T. Grant Co., 345 U.S. 629, 632, 73 S.Ct. 894, 897, 97 L.Ed. 1303. The situation here is thus quite different from that presented in the Harris and Oil Workers Unions cases, and we hold that the merits of this controversy are before us and must be decided.
5
The King-Thompson Act defines certain public utilities as 'life essentials of the people' and declares it to be the policy of the State that 'the possibility of labor strife in utilities operating under governmental franchise or permit or under governmental ownership and control is a threat to the welfare and health of the people.'4 The Act imposes requirements in connection with the duration and renewal of collective bargaining agreements,5 and creates a State Board of Mediation and public hearing panels whose services are to be invoked whenever the parties cannot themselves agree upon the terms to be included in a new agreement.6 And where, as here, the recommendations of these agencies are not accepted, and the continued operation of the utility is threatened as a result, the Governor is empowered to 'take immediate possession of' the utility 'for the use and operation by the state of Missouri in the public interest.'7
6
In Amalgamated Ass'n of Street, Electric Ry. & Motor Coach Employees of America, Division 998 v. Wisconsin Employment Relations Board, 340 U.S. 383, 71 S.Ct. 359, 95 L.Ed. 364, this Court held that the Wisconsin Public Utility Anti-Strike Law, which made it a misdemeanor for public utility employees to engage in a strike which would cause an interruption of an essential public utility service, conflicted with the National Labor Relations Act and was therefore invalid under the Supremacy Clause of the Constitution. The Supreme Court of Missouri in the present case rejected the appellants' argument that the Wisconsin Board decision was determinative of the unconstitutionality of the Missouri statute here in issue. The court held that the provisions of the King-Thompson Act dealing with the mediation board and public hearing panels were severable from the remainder of the statute, and refused to pass on any but those provisions which authorize the seizure and the issuance of injunctions against strikes taking place after seizure has been imposed. These provisions, the court ruled, do not—as in the Wisconsin Board case—provide a comprehensive labor code conflicting with federal legislation, but rather represent 'strictly emergency legislation' designed solely to authorize use of the State's police power to protect the public from threatened breakdowns in vital community services. Emphasizing that the company was not a party to the injunction suit, the court concluded that, although the State did not actively participate in the management of the utility's operations, the Governor's executive order had been sufficient to convert the strike into one against the State, and that an injunction barring such a strike is therefore not barred by the provisions of federal labor legislation. 361 S.W.2d, at 44, 46, 48 52.
7
We disagree. None of the distinctions drawn by the Missouri court between the King-Thompson Act and the legislation involved in Wisconsin Board seem to us to be apposite. First, whatever the status of the title to the properties of Kansas City Transit, Inc., acquired by the State as a result of the Governor's executive order, the record shows that the State's involvement fell far short of creating a state-owned and operated utility whose labor relations are by definition excluded from the coverage of the National Labor Relations Act.8 The employees of the company did not become employees of Missouri. Missouri did not pay their wages, and did not direct or supervise their duties. No property of the company was actually conveyed, transferred, or otherwise turned over to the State. Missouri did not participate in any way in the actual management of the company, and there was no change of any kind in the conduct of the company's business. As summed up by the Chairman of the State Mediation Board: 'So far as I know the company is operating now just as it was two weeks ago before the strike.'
8
Secondly, the Wisconsin Board case decisively rejected the proposition that a state enactment affecting a public utility operating in interstate commerce could be saved from a challenge based upon a demonstrated conflict with the standards embodied in federal law simply by designating it as 'emergency legislation.' There the Court said that where 'the state seeks to deny entirely a federally guaranteed right which Congress itself restricted only to a limited extent in case of national emergencies, however serious, it is manifest that the state legislation is in conflict with federal law.' 340 U.S., at 394, 71 S.Ct. at 365.
9
The short of the matter is that Missouri, through the fiction of 'seizure' by the State, has made a peaceful strike against a public utility unlawful, in direct conflict with federal legislation which guarantees the right to strike against a public utility, as against any employer engaged in interstate commerce.9 In forbidding a strike against an employer covered by the National Labor Relations Act, Missouri has forbidden the exercise of rights explicitly protected by § 7 of that Act.10 Collective bargaining, with the right to strike at its core, is the essence of the federal scheme. As in Wisconsin Board, a state law which denies that right cannot stand under the Supreme Clause of the Constitution.
10
It is hardly necessary to add that nothing we have said even remotely affects the right of a State to own or operate a public utility or any other business, nor the right or duty of the chief executive or legislature of a State to deal with emergency conditions of public danger, violence, or disaster under appropriate provisions of the State's organic or statutory law.
11
Reversed.
1
The King-Thompson Act is Chapter 295 of the Revised Statutes of Missouri, 1959. The section of the statute authorizing seizure is Mo.Rev.Stat., 1959, § 295.180, V.A.M.S.
2
Missouri Rev.Stat., 1959, § 295.200, par. 1, provides:
'It shall be unlawful for any person, employee, or representative as defined in this chapter to call, incite, support or participate in any strike or concerted refusal to work for any utility or for the state after any plant, equipment or facility has been taken over by the state under this chapter, as means of enforcing any demands against the utility or against the state.'
'Section 295.200, par. 6, provides:
'The courts of this state shall have power to enforce by injunction or other legal or equitable remedies any provision of this chapter or any rule or regulation prescribed by the governor hereunder.'
3
See State ex rel. State Board of Mediation v. Pigg, 362 Mo. 798, 244 S.W.2d 75; Rider v. Julian, 365 Mo. 313, 282 S.W.2d 484; State v. Local No. 8—6, Oil, Chemical & Atomic Workers International Union, AFL—CIO, Mo., 317 S.W.2d 309, vacated as moot, 361 U.S. 363, 80 S.Ct. 391, 4 L.Ed.2d 373.
4
§ 295.010. 'It is hereby declared to be the policy of the state that heat, light, power, sanitation, transportation, communication, and water are life essentials of the people; that the possibility of labor strife in utilities operating under governmental franchise or permit or under governmental ownership and control is a threat to the welfare and health of the people; that utilities so operating are clothed with public interest, and the state's regulation of the labor relations affecting such public utilities is necessary in the public interest.'
5
§ 295.090. 'All collective bargaining labor agreements hereafter entered into between the management of a utility and its employees or any craft or class of employees shall be reduced to writing and continue for a period of not less than one year from the date of the expiration of the previous agreement entered into between the management of the utility and its employees or if there has been no such previous agreement then for a period of not less than one year from the date of the actual execution of the agreement. Such agreement shall be presumed to continue in force and effect from year to year after the date fixed for its original termination unless either or both parties thereto inform the other, in writing, of the specific changes desired to be made therein and shall also file a copy of such demands with the state board of mediation, at least sixty days before the original termination date or sixty days before the end of any yearly renewal period, or sixty days before any termination date desired thereafter.'
6
Mo.Rev.Stat., 1959, §§ 295.030, 295.070, 295.080, 295.120, 295.140, 295.160, 295.170.
7
§ 295.180. '1. Should either the utility or its employees refuse to accept and abide by the recommendations made pursuant to the provisions of this chapter and as a result thereof the effective operation of a public utility be threatened or interrupted, or should either party in a labor dispute between a utility and its employees, after having given sixty days' notice thereof, or failing to give such notice, engage in any strike, work stoppage or lockout which, in the opinion of the governor, will result in the failure to continue the operation of the public utility, and threatens the public interest, health and welfare, or in the event that neither side has given notice to the other of an intention to seek a change in working conditions, and there occurs a lockout, strike or work stoppage which, in the opinion of the governor, threatens to impair the operation of the utility so as to interfere with the public interest, health and welfare, then and in that case he is authorized to take immediate possession of the plant, equipment or facility for the use and operation by the state of Missouri in the public interest.
'2. Such power and authority may be exercised by the governor through such department or agency of the government as he may designate and may be exercised after his investigation and proclamation that there is a threatened or actual interruption of the operation of such public utility as the result of a labor dispute, a threatened or actual strike, a lockout or other labor disturbance, and that the public interest, health and welfare are jeopardized, and that the exercise of such authority is necessary to insure the operation of such public utility; provided, that whenever such public utility, its plant, equipment or facility has been or is hereafter so taken by reason of a strike, lockout, threatened strike, threatened lockout, work stoppage or slowdown, or other cause, such utility, plant, equipment or facility shall be returned to the owners thereof as soon as practicable after the settlement of said labor dispute, and it shall thereupon be the duty of such utility to continue the operation of the plant facility, or equipment in accordance with its franchise and certificate of public convenience and necessity.'
8
29 U.S.C. § 152(2), (3), 49 Stat. 450; 61 Stat. 137—138. Compare United States v. United Mine Workers, 330 U.S. 258, 67 S.Ct. 677, 91 L.Ed. 884.
9
In enacting the Taft-Hartley Act, Congress expressly rejected the suggestion that public utilities be treated differently from other employers. As explained by Senator Taft, 'If we begin with public utilities, it will be said that coal and steel are just as important as public utilities. I do not know where we could draw the line. So far as the bill is concerned, we have proceeded on the theory that there is a right to strike and that labor peace must be based on free collective bargaining.' 93 Cong.Rec. 3835.
10
'Employees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, and shall also have the right to regrain from any or all of such activities except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment as authorized in section 158(a)(3).' 29 U.S.C. § 157, 49 Stat. 452; 61 Stat. 140.
| 910
|
374 U.S. 16
83 S.Ct. 1646
10 L.Ed.2d 720
Thomas I. FITZGERALD, Public Administrator of the County of New York, etc., Petitioner,v.UNITED STATES LINES COMPANY.
No. 463.
Argued April 18, 1963.
Decided June 10, 1963.
Theodore H. Friedman, New York City, for petitioner.
Matthew L. Danahar, New York City, for respondent.
Mr. Justice BLACK delivered the opinion of the Court.
1
Andres San Martin, a seaman, brought this action in the District Court for the Southern District of New York against the respondent United States Lines Company. His complaint alleged that he had twisted and strained his back while working for respondent on its ship. He claimed $75,000 damages based on the negligence of respondent and on the unseaworthiness of the ship and $10,000 based on respondent's failure to provide him with medical attention, maintenance and cure, and wages as required by law.1 Martin's negligence claim invoked a remedy created by Congress in § 33 of the Jones Act, 46 U.S.C. § 688, which explicitly provides that a seaman can have a jury trial as of right; but the actions for unseaworthiness and for maintenance and cure are traditional admiralty remedies which in the absence of a statute do not ordinarily require trial by jury. The complainant here did demand a jury, however, for all the issues growing out of the single accident. The trial judge granted a jury trial for the Jones Act and the unseaworthiness issues but held the question of recovery under maintenance and cure in abeyance to try himself after jury trial of the other two issues. The jury returned a verdict for United States Lines on the negligence and unseaworthiness issues; the court then, after hearing testimony in addition to that presented to the jury, awarded Martin $224 for maintenance and cure. Sitting en banc, the Court of Appeals for the Second Circuit affirmed, four judges stating that it would be improper to submit a maintenance and cure claim to the jury, two believing it to be permissible but not required, and three maintaining that a seaman is entitled, as of right, to a jury trial of a maintenance and cure claim joined with a Jones Act claim. 2 Cir., 306 F.2d 461. The lower courts are at odds on this issue.2 We granted certiorari to decide it.3 371 U.S. 932, 83 S.Ct. 307, 9 L.Ed.2d 269.
2
For years it has been a common, although not uniform,4 practice of District Courts to grant jury trials to plaintiffs who join in one complaint their Jones Act, unseaworthiness, and maintenance and cure claims when all the claims, as here, grow out of a single transaction or accident.5 This practice of requiring issues arising out of a single accident to be tried by a single tribunal is by no means surprising. Although remedies for negligence, unseaworthiness, and maintenance and cure have different origins and may on occasion call for application of slightly different principles and procedures, they nevertheless, when based on one unitary set of circumstances, serve the same purpose of indemnifying a seaman for damages caused by injury, depend in large part upon the same evidence, and involve some identical elements of recovery. Requiring a seaman to split up his lawsuit, submitting part of it to a jury and part to a judge, unduly complicates and confuses a trial, creates difficulties in applying doctrines of res judicata and collateral estoppel, and can easily result in too much or too little recovery.6 The problems are particularly acute in determining the amount of damages. For example, all lost earnings and medical expenses are recoverable on a negligence count, but under the Jones Act they are subject to reduction by the jury if the seaman has been contributorily negligent. These same items are recoverable in part on the maintenance and cure count, but the damages are measured by different standards7 and are not subject to reduction for any contributory negligence. It is extremely difficult for a judge in trying a maintenance and cure claim to ascertain, even with the use of special interrogatories, exactly what went into the damages awarded by a jury—how loss of earning power was calculated, how much was allowed for medical expenses and pain and suffering, how much was allowed for actual lost wages, and how much, if any, each of the recoveries was reduced by contributory negligence. This raises needless problems of two has the burden of proving exactly what the jury did.8 And even if the judge can find out what elements of damage the jury's verdict actually represented, he must still try to solve the puzzling problem of the bearing the jury's verdict should have on recovery under the different standards of the maintenance and cure claim. In the absence of some statutory or constitutional obstacle, an end should be put to such an unfortunate, outdated, and wasteful manner of trying these cases.9 Fortunately, there is no such obstacle.
3
While this Court has held that the Seventh Amendment does not require jury trials in admiralty cases,10 neither that Amendment nor any other provision of the Constitution forbids them.11 Nor does any statute of Congress or Rule of Procedure, Civil or Admiralty, forbid jury trials in maritime cases. Article III of the Constitution vested in the federal courts jurisdiction over admiralty and maritime cases, and, since that time, the Congress has largely left to this Court the responsibility for fashioning the controlling rules of admiralty law. This Court has long recognized its power and responsibility in this area and has exercised that power where necessary to do so.12 Where, as here, a particular mode of trial being used by many judges is so cumbersome, confusing, and time consuming that it places completely unnecessary obstacles in the paths of litigants seeking justice in our courts, we should not and do not hesitate to take action to correct the situation. Only one trier of fact should be used for the trial of what is essentially one lawsuit to settle one claim split conceptually into separate parts because of historical developments. And since Congress in the Jones Act has declared that the negligence part of the claim shall be tried by a jury, we would not be free, even if we wished, to require submission of all the claims to the judge alone. Therefore, the jury, a time-honored institution in our jurisprudence, is the only tribunal competent under the present congressional enactment to try all the claims. Accordingly, we hold that a maintenance and cure claim joined with a Jones Act claim must be submitted to the jury when both arise out of one set of facts. The seaman in this case was therefore entitled to a jury trial as of right on his maintenance and cure claim.
4
Judgment against the seaman on the Jones Act claim was affirmed by the Court of Appeals, and we declined to review it on certiorari. The shipowner points out that on remand the maintenance and cure claim would no longer be joined with a Jones Act claim and therefore, he argues, could be tried by a judge without a jury. We cannot agree. Our holding is that it was error to deprive the seaman of the jury trial he demanded, and he is entitled to relief from this error by having the kind of trial he would have had in the absence of error.
5
Reversed.
6
Mr. Justice HARLAN (dissenting).
7
I am wholly in sympathy with the result reached by the Court. It is, I believe, a result that is consistent with sound judicial administration and that will greatly simplify the conduct of suits in which a claim for maintenance and cure is joined with a Jones Act claim arising out of the same set of facts.
8
But the rule that the Court announces is in my view entirely procedural in character, and the manner in which such rules must be promulgated has been specified by Congress in 28 U.S.C. § 2073. This statute provides that rules of procedure in admiralty
9
'shall not take effect until they have been reported to Congress by the Chief Justice at or after the beginning of a regular session thereof * * * and until the expiration of ninety days after they have been thus reported.'
10
Believing that we are governed by this provision, and that the method there prescribed for the declaration of procedural rules, which are to be applicable in all Federal District Courts, is exclusive, I am unable to subscribe to the opinion of the Court.* I think the appropriate way to achieve what in this instance is obviously a desirable procedural reform is to deal with the matter through the Judicial Conference of the United States. Cf. Miner v. Atlass, 363 U.S. 641, 80 S.Ct. 1300, 4 L.Ed.2d 1462. Meanwhile, substantially for the reasons given in Judge Friendly's opinion, I consider that the judgment below must be affirmed.
1
Martin died while his appeal was pending and a public administrator was substituted for him.
2
See notes 4 and 5, infra.
3
Because of our limited grant of certiorari, we do not consider petitioner's argument that the complaint and trial record show diversity of citizenship jurisdiction and that therefore plaintiff was entitled to a jury trial. See Atlantic & Gulf Stevedores, Inc., v. Ellerman Lines, 369 U.S. 355, 360, 82 S.Ct. 780, 783, 7 L.Ed.2d 798 (1962). Nor do we find it necessary to reach petitioner's argument that we should reconsider that part of the holding of Romero v. International Terminal Operating Co., 358 U.S. 354, 79 S.Ct. 468, 3 L.Ed.2d 368 (1959), which concluded that claims based upon general maritime law cannot be brought in federal courts under the federal question jurisdiction of 28 U.S.C. § 1331.
4
See, e.g., Jesonis v. Oliver J. Olson & Co., 238 F.2d 307 (C.A.9th Cir. 1956); Stenduze v. The Boat Neptune, Inc., 135 F.Supp. 801 (D.C.Mass.1955); cf. Jordine v. Walling, 185 F.2d 662 (C.A.3d Cir. 1950).
5
See, e.g., Nolan v. General Seafoods Corp., 112 F.2d 515 (C.A.1st Cir. 1940); Lykes Bros. S.S. Co. v. Grubaugh, 128 F.2d 387, modified on rehearing, 130 F.2d 25 (C.A.5th Cir. 1942); Bay State Dredging & Contracting Co. v. Porter, 153 F.2d 827 (C.A.1st Cir. 1946); Gonzales v. United Fruit Co., 193 F.2d 479 (C.A.2d Cir. 1951); Rosenquist v. Isthmian S.S. Co., 205 F.2d 486 (C.A.2d Cir. 1953); Mitchell v. Trawler Racer, Inc., 265 F.2d 426 (C.A.1st Cir. 1959), rev'd on other grounds, 362 U.S. 539, 362 U.S. 539, 80 S.Ct. 926, 4 L.Ed.2d 941 (1960); McDonald v. Cape Code Trawling Corp., 71 F.Supp. 888, 891 (D.C.Mass.1947); Gilmore and Black, The Law of Admiralty (1957), 262.
6
For an illuminating discussion of the practical problems, see Jenkins v. Roderick, 156 F.Supp. 299, 304—306 (D.C.Mass.1957) (Wyzanski, J.).
This Court has held that recovery of maintenance and cure does not bar a subsequent action under the Jones Act, Pacific S.S. Co. v. Peterson, 278 U.S. 130, 49 S.Ct. 75, 73 L.Ed. 220 (1928), but of course, where such closely related claims are submitted to different triers of fact, questions of res judicata and collateral estoppel necessarily arise, particularly in connection with efforts to avoid duplication of damages.
7
Maintenance and cure allows recovery for wages only to the end of the voyage on which a seaman is injured or becomes ill. The Osceola, 189 U.S. 158, 175, 23 S.Ct. 483, 487, 47 L.Ed. 760 (1903). Medical expenses need not be provided beyond the point at which a seaman becomes incurable. Farrell v. United States, 336 U.S. 511, 69 S.Ct. 707, 93 L.Ed. 850 (1949).
8
See, e.g., Bartholomew v. Universe Tankships, Inc., 279 F.2d 911, 915—916 (C.A.2d Cir. 1960); Stendze v. The Boat Neptune, Inc., 135 F.Supp. 801 (D.C.Mass.1955). For another example of some of the difficulties involved in separate trials, compare Claudio v. Sinclair Ref. Co., 160 F.Supp. 3 (D.C.E.D.N.Y.1958), with Lazarowitz v. American Export Lines, 87 F.Supp. 197 (D.C.E.D.Pa.1949).
9
See generally Currie, The Silver Oar and All That: A Study of the Romero Case, 27 U. of Chi.L.Rev. 1 (1959); Kurland, The Romero Case and Some Problems of Federal Jurisdiction, 73 Harv.L.Rev. 817, 850 (1960); Note, 73 Harv.L.Rev. 138 (1959).
10
Waring v. Clarke, 5 How. 441, 12 L.Ed. 226, 460 (1847).
11
The Genesee Chief v. Fitzhugh, 12 How. 443, 459—460, 13 L.Ed. 1058 (Dec. Term, 1851) (upholding constitutionality of jury trial provision in Great Lakes Act).
12
See, e.g., The John G. Stevens, 170 U.S. 113, 18 S.Ct. 544, 42 L.Ed. 969 (1898); Swift & Co. Packers v. Compania Colombiana Del Caribe, S.A., 339 U.S. 684, 690, 691, 70 S.Ct. 861, 865, 866, 94 L.Ed. 1206 (1950); Warren v. United States, 340 U.S. 523, 527, 71 S.Ct. 432, 434, 95 L.Ed. 503 (1951); Wilburn Boat Co. v. Fireman's Fund Ins. Co., 348 U.S. 310, 314, 75 S.Ct. 368, 370, 99 L.Ed. 337 (1955); Romero v. International Terminal Operating Co., 358 U.S. 354, 360—361, 79 S.Ct. 468, 473, 474, 3 L.Ed.2d 368 (1959); The Tungus v. Skovgaard, 358 U.S. 588, 597, 611, 79 S.Ct. 503, 509, 516, 3 L.Ed.2d 524 (1959) (opinion of Brennan, J., concurring in part and dissenting in part); Mitchell v. Trawler Racer, Inc., 362 U.S. 539, 80 S.Ct. 926, 4 L.Ed.2d 941 (1960).
*
The course taken by the Court is not, in my view, supported by any of the cases cited in note 12 of the Court's opinion. None of them involved a procedural rule.
| 78
|
374 U.S. 23
83 S.Ct. 1623
10 L.Ed.2d 726
George D. KER et al., Petitioners,v.STATE OF CALIFORNIA.
No. 53.
Argued Dec. 11, 1962.
Decided June 10, 1963.
Robert W. Stanley, Los Angeles, Cal., for petitioners.
Gordon Ringer, Los Angeles, Cal., for respondent.
Mr. Justice CLARK delivered the opinion of the Court with reference to the standard by which state searches and seizures must be evaluated (Part I), together with an opinion applying that standard, in which Mr. Justice BLACK, Mr. Justice STEWART and Mr. Justice WHITE join (Parts II—V), and announced the judgment of the Court.
1
This case raises search and seizure questions under the rule of Mapp v. Ohio, 367 U.S. 643, 81 S.Ct. 1684 , 6 L.Le.2d 1081 (1961). Petitioners, husband and wife, were convicted of possession of marijuana in violation of § 11530 of the California Health and Safety Code. The California District Court of Appeal affirmed, 195 Cal.App.2d 246, 15 Cal.Rptr. 767, despite the contention of petitioners that their arrests in their apartment without warrants lacked probable cause1 and the evidence seized incident thereto and introduced at their trial was therefore inadmissible. The California Supreme Court denied without opinion a petition for hearing. This being the first case arriving here since our opinion in Mapp which would afford suitable opportunity for further explication of that holding in the light of intervening experience, we granted certiorari. 368 U.S. 974, 82 S.Ct. 480, 7 L.Ed.2d 437. We affirm the judgment before us.
2
The state courts' conviction and affirmance are based on these events, which culminated in the petitioners' arrests. Sergeant Cook of the Los Angeles County Sheriff's Office, in negotiating the purchase of marijuana from one Terrhagen, accompanied him to a bowling alley about 7 p.m. on July 26, 1960, where they were to meet Terrhagen's 'connection.' Therrhagen went inside and returned shortly, pointing to a 1946 DeSoto as his 'connection's' automobile and explaining that they were to meet him 'up by the oil fields' near Fairfax and Slauson Avenues in Los Angeles. As they neared that location, Terrhagen again pointed out the DeSoto traveling ahead of them, stating that the 'connection' kept his supply of narcotics 'somewhere up in the hills.' They parked near some vacant fields in the vicinity of the intersection of Fairfax and Slauson, and, shortly thereafter, the DeSoto reappeared and pulled up beside them. The deputy then recognized the driver as one Roland Murphy, whose 'mug' photograph he had seen and whom he knew from other narcotics officers to be a large-scale seller of marijuana currently out on bail in connection with narcotics charges.
3
Terrhagen entered the DeSoto and drove off toward the oil fields with Murphy, while the Sergeant waited. They returned shortly, Terrhagen left Murphy's car carrying a package of marijuana and entered his own vehicle, and they drove to Terrhagen's residence. There Terrhagen cut one pound of marijuana and gave it to Sergeant Cook, who had previously paid him. The Sergeant later reported this occurrence to Los Angles County Officers Berman and Warthen, the latter of whom had observed the occurrences as well.
4
On the following day, July 27, Murphy was placed under surveillance. Officer Warthen, who had observed the Terrhagen-Murphy episode the previous night, and Officer Markman were assigned this duty. At about 7 p.m. that evening they followed Murphy's DeSoto as he drove to the same bowling alley in which he had met Terrhagen on the previous evening. Murphy went inside, emerged in about 10 minutes and drove to a house where he made a brief visit. The officers continued to follow him but, upon losing sight of his vehicle, proceeded to the vicinity of Fairfax and Slauson Avenues where they parked. There immediately across the street from the location at which Terrhagen and Sergeant Cook had met Murphy on the previous evening, the officers observed a parked automobile whose lone occupant they later determined to be the petitioner George Douglas Ker.
5
The officers then saw Murphy drive past them. They followed him but lost sight of him when he extinguished his lights and entered the oil fields. The officers returned to their vantage point and, shortly thereafter, observed Murphy return and park behind Ker. From their location approximately 1,000 feet from the two vehicles, they watched through field glasses. Murphy was seen leaving his DeSoto and walking up to the driver's side of Ker's car, where he 'appeared to have conversation with him.' It was shortly before 9 p.m. and the distance in the twilight was too great for the officers to see anything pass between Murphy and Ker or whether the former had anything in his hands as he approached.
6
While Murphy and Ker were talking, the officers had driven past them in order to see their faces closely and in order to take the license number from Ker's vehicle. Soon thereafter Ker drove away and the officers followed him but lost him when he made a U-turn in the middle of the block and drove in the opposite direction. Now, having lost contact with Ker, they checked the registration with the Department of Motor Vehicles ascertained that the automobile was registered to Douglas Ker at 4801 Slauson. They then communicated this information to Officer Berman, within 15 to 30 minutes after observing the meeting between Ker and Murphy. Though officers Warthen and Markman had no previous knowledge of Ker, Berman had received information at various times beginning in November of 1959 that Ker was selling marijuana from his apartment and that 'he was possibly securing this Marijuana from Ronnie Murphy who is the alias of Roland Murphy.' In early 1960 Officer Berman had received a 'mug' photograph of Ker from the Inglewood Police Department. He further testified that between May and July 27, 1960, he had received information as to Ker from one Robert Black, who had previously given information leading to at least three arrests and whose information was believed by Berman to be reliable. According to Officer Berman, Black had told him on four or five occasions after May 1960 that Ker and others, including himself, had purchased marijuana from Murphy.2
7
Armed with the knowledge of the meeting between Ker and Murphy and with Berman's information as to Ker's dealings with Murphy, the three officers and a fourth, Officer Love, proceeded immediately to the address which they had obtained through Ker's license number. They found the automobile which they had been following—and which they had learned was Ker's—in the parking lot of the multiple-apartment building and also ascertained that there was someone in the Kers' apartment. They then went to the office of the building manager and obtained from him a passkey to the apartment. Officer Markman was stationed outside the window to intercept any evidence which might be ejected, and the other three officers entered the apartment. Officer Berman unlocked and opened the door, proceeding quietly, he testified, in order to prevent the destruction of evidence,3 and found petitioner George Ker sitting in the living room. Just as he identified himself, stating that 'We are Sheriff's Narcotics Officers, conducting a narcotics investigation,' petitioner Diane Ker emerged from the kitchen. Berman testified that he repeated his identification to her and immediately walked to the kitchen. Without entering, he observed through the open doorway a small scale atop the kitchen sink, upon which lay a 'brick-like—brick-shaped package containing the green leafy substance' which he recognized as marijuana. He beckoned the petitioners into the kitchen where, following their denial of knowledge of the contents of the two-and-two-tenths-pound package and failure to answer a question as to its ownership, he placed them under arrest for suspicion of violating the State Narcotic Law. Officer Markman testified that he entered the apartment approximately 'a minute, minute and a half' after the other officers, at which time Officer Berman was placing the petitioners under arrest. As to this sequence of events, petitioner George Ker testified that his arrest took place immediately upon the officers' entry and before they saw the brick of marijuana in the kitchen.
8
Subsequent to the arrest and the petitioners' denial of possession of any other narcotics, the officers, proceeding without search warrants, found a half-ounce package of marijuana in the kitchen cupboard and another atop the bedroom dresser. Petitioners were asked if they had any automobile other than the one observed by the officers, and George Ker replied in the negative, while Diane remained silent. On the next day, having learned that an automobile was registered in the name of Diane Ker, Officer Warthen searched this car without a warrant, finding marijuana and marijuana seeds in the glove compartment and under the rear seat. The marijuana found on the kitchen scale, that found in the kitchen cupboard and in the bedroom, and that found in Diane Ker's automobile4 were all introduced into evidence against the petitioners.
9
The California District Court of Appeal in affirming the convictions found that there was probable cause for the arrests; that the entry into the apartment was for the purpose of arrest and was not unlawful; and that the search being incident to the arrests was likewise lawful and its fruits admissible in evidence against petitioners. These conclusions were essential to the affirmance, since the California Supreme Court in 1955 had held that evidence obtained by means of unlawful searches and seizures was inadmissible in criminal trials. People v. Cahan, 44 Cal.2d 434, 282 P.2d 905, 50 A.L.R.2d 513. The court concluded that in view of its findings and the implied findings of the trial court, this Court's intervening decision in Mapp v. Ohio, supra, did 'not justify a change in our original conclusion.' 195 Cal.App.2d, at 257, 15 Cal.Rptr., at 773.
I.
10
In Mapp v. Ohio, 367 U.S., at 646—647, 657, 81 S.Ct. at 1686 1687, 1692—1693, 6 L.Ed.2d 1081, we followed Boyd v. United States, 116 U.S. 616, 630, 6 S.Ct. 524, 532, 29 L.Ed. 746 (1886), which held that the Fourth Amendment,5 implemented by the self-incrimination clause of the Fifth,6 forbids the Federal Government to convict a man of crime by using testimony or papers obtained from him by unreasonable searches and seizures as defined in the Fourth Amendment. We specifically held in Mapp that this constitutional prohibition is enforceable against the States through the Fourteenth Amendment.7 This means, as we said in Mapp, that the Fourth Amendment 'is enforceable against them (the states) by the same sanction of exclusion as is used against the Federal Government,' by the application of the same constitutional standard prohibiting 'unreasonable searches and seizures.' 367 U.S., at 655, 81 S.Ct., at 1691, 6 L.Ed.2d 1081¢ Y. We now face the specific question as to whether Mapp requires the exclusion of evidence in this case which the California District Court of Appeals has held to be lawfully seized. It is perhaps ironic that the initial test under the Mapp holding comes from California, whose decision voluntarily to adopt the exclusionary rule in 1955 has been commended by us previously. See Mapp v. Ohio, supra, 367 U.S., at 651—652, 81 S.Ct., at 1689 1690, 6 L.Ed.2d 1081¢ Y; Elkins v. United States, 364 U.S. 206, 220, 80 S.Ct. 1437, 1445—1446, 4 L.Ed.2d 1669 (1960).
11
Preliminary to our examination of the search and seizures involved here, it might be helpful for us to indicate what was not decided in Mapp. First, it must be recognized that the 'principles governing the admissibility of evidence in federal criminal trials have not been restricted * * * to those derived solely from the Constitution. In the exercise of its supervisory authority over the administration of criminal justice in the federal courts * * * this Court has * * * formulated rules of evidence to be applied in federal criminal prosecutions.' McNabb v. United States, 318 U.S. 332, 341, 63 S.Ct. 608, 613, 87 L.Ed. 819 (1943); cf. Miller v. United States, 357 U.S. 301, 78 S.Ct. 1190, 2 L.Ed.2d 1332 (1958); Nardone v. United States, 302 U.S. 379, 58 S.Ct. 275, 82 L.Ed. 3 14 (1937). Mapp, however, established no assumption by this Court of supervisory authority over state courts, cf. Cleary v. Bolger, 371 U.S. 392, 401, 83 S.Ct. 385, 390, 9 L.Ed.2d 390 (1963), and, consequently, it implied no total obliteration of state laws relating to arrests and searches in favor of federal law. Mapp sounded no death knell for our federalism; rather, it echoed the sentiment of Elkins v. United States, supra, 364 U.S., at 221, 80 S.Ct., at 1446, 4 L.Ed.2d 1 669, that 'a healthy federalism depends upon the avoidance of needless conflict between state and federal courts' by itself urging that '(f) ederal-state cooperation in the solution of crime under constitutional standards will be promoted, if only by recognition of their now mutual obligation to respect the same fundamental criteria in their approaches.' 367 U.S., at 658, 81 S.Ct., at 1693, 6 L.Ed.2d 1081. (Emphasis added.) Second, Mapp did not attempt the impossible task of laying down a 'fixed formula' for the application in specific cases of the constitutional prohibition against unreasonable searches and seizures; it recognized that we would be 'met with 'recurring questions of the reasonableness of searches," and that, 'at any rate, '(r)easonableness is in the first instance for the (trial court) to determine," id., 367 U.S., at 653, 81 S.Ct., at 1690, 6 L.Ed.2d 1081, thus indicating that the usual weight be given to findings of trial courts.
12
Mapp, of course, did not lend itself to a detailed explication of standards, since the search involved there was clearly unreasonable and bore no stamp of legality even from the Ohio Supreme Court. Id., 367 U.S., at 643—645, 81 S.Ct., at 1684 1686, 6 L.Ed.2d 1081. This is true also of Elkins v. United States, where all of the courts assumed the unreasonableness of the search in question and this Court 'invoked' its 'supervisory power over the administration of criminal justice in the federal courts,' 364 U.S., at 216 , 80 S.Ct., 1443, 4 L.Ed.2d 1669, in declaring that the evidence so seized by state officers was inadmissible in a federal prosecution. The prosecution being in a federal court, this Court of course announced that '(t)he test is one of federal law, neither enlarged by what one state court may have countenanced, nor diminished by what another may have colorably suppressed.' Id., 364 U.S., at 224, 80 S.Ct., at 1447, 4 L.Ed.2d 1669 . Significant in the Elkins holding is the statement, apposite here, that 'it can fairly be said that in applying the Fourth Amendment this Court has seldom shown itself unaware of the practical demands of effective criminal investigation and law enforcement.' Id., 364 U.S., at 222, 80 S.Ct., at 1446, 4 L.Ed.2d 1669.
13
Implicit in the Fourth Amendment's protection from unreasonable searches and seizures is its recognition of individual freedom. That safeguard has been declared to be 'as of the very essence of constitutional liberty' the guaranty of which 'is as important and as imperative as are the guaranties of the other fundamental rights of the individual citizen * * *.' Gouled v. United States, 255 U.S. 298, 304, 41 S.Ct. 261, 263, 65 L.Ed. 647 (1921); cf. Powell v. Alabama, 287 U.S. 45, 65—68, 53 S.Ct. 55, 62—64, 77 L.Ed. 158 (1932). While the language of the Amendment is 'general,' it 'forbids every search that is unreasonable; it protects all, those suspected or known as to be offenders as well as the innocent, and unquestionably extends to the premises where the search was made * * *.' Go-Bart Importing Co. v. United States, 282 U.S. 344, 357, 51 S.Ct. 153, 158, 75 L.Ed. 374 (1931). Mr. Justice Butler there stated for the Court that '(t)he Amendment is to be liberally construed and all owe the duty of vigilance for its effective enforcement lest there shall be impairment of the rights for the protection of which it was adopted.' Ibid. He also recognized that '(t)here is no formula for the determination of reasonableness. Each case is to be decided on its own facts and circumstances.' Ibid.; see United States v. Rabinowitz, 339 U.S. 56, 63, 70 S.Ct. 430, 434, 94 L.Ed. 653 (1950); Rios v. United States, 364 U.S. 253, 255, 80 S.Ct. 1431, 1433, 4 L.Ed.2d 1688 (1960).
14
This Court's long-established recognition that standards of reasonableness under the Fourth Amendment are not susceptible of Procrustean application is carried forward when that Amendment's proscriptions are enforced against the States through the Fourteenth Amendment. And, although the standard of reasonableness is the same under the Fourth and Fourteenth Amendments, the demands of our federal system compel us to distinguish between evidence held inadmissible because of our supervisory powers over federal courts and that held inadmissible because prohibited by the United States Constitution. We reiterate that the reasonableness of a search is in the first instance a substantive determination to be made by the trial court from the facts and circumstances of the case and in the light of the 'fundamental criteria' laid down by the Fourth Amendment and in opinions of this Court applying that Amendment. Findings of reasonableness, of course, are respected only insofar as consistent with federal constitutional guarantees. As we have stated above and in other cases involving federal constitutional rights, findings of state courts are by no means insulated against examination here. See, e.g., Spano v. New York, 360 U.S. 315, 316, 79 S.Ct. 1202, 1203, 3 L.Ed.2d 1265 (1959); Thomas v. Arizona, 356 U.S. 390, 393, 78 S.Ct. 885, 887, 2 L.Ed.2d 863 (1958); Pierre v. Louisiana, 306 U.S. 354, 358, 59 S.Ct. 536, 538—539, 83 L.Ed. 757 (1939). While this Court does not sit as in nisiprius to appraise contradictory factual questions, it will, where necessary to the determination of constitutional rights, make an independent examination of the facts, the findings, and the record so that it can determine for itself whether in the decision as to reasonableness the fundamental—i.e., constitutional—criteria established by this Court have been respected. The States are not thereby precluded from developing workable rules governing arrests, searches and seizures to meet 'the practical demands of effective criminal investigation and law enforcement' in the States, provided that those rules do not violate the constitutional proscription of unreasonable searches and seizures and the concomitant command that evidence so seized is inadmissible against one who has standing to complain. See Jones v. United States, 362 U.S. 257, 80 S.Ct. 725, 4 L.Ed.2d 697 (1960). Such a standard implies no derogation of uniformity in applying federal constitutional guarantees but is only a recognition that conditions and circumstances vary just as do investigative and enforcement techniques.
15
Applying this federal constitutional standard we proceed to examine the entire record including the findings of California's courts to determine whether the evidence seized from petitioners was constitutionally admissible under the circumstances of this case.
II.
16
The evidence at issue, in order to be admissible, must be the product of a search incident to a lawful arrest, since the officers had no search warrant. The lawfulness of the arrest without warrant, in turn, must be based upon probable cause, which exists 'where 'the facts and circumstances within their (the officers') knowledge and of which they had reasonably trustworthy information (are) sufficient in themselves to warrant a man of reasonable caution in the belief that ' an offense has been or is being committed.' Brinegar v. United States, 338 U .S. 160, 175—176, 69 S.Ct. 1302, 1311, 93 L.Ed. 1 879 (1949), quoting from Carroll v. United States, 267 U.S. 132, 162, 45 S.Ct. 280, 288, 69 L.Ed. 543 (1925); accord, People v. Fischer, 49 Cal.2d 442, 317 P.2d 967 (1957); Bompensiero v. Superior Court, 44 Cal.2d 178, 281 P.2d 250(1955) .The information within the knowledge of the officers at the time they arrived at the Kers' apartment, as California's courts specifically found, clearly furnished grounds for a reasonable belief that petitioner George Ker had committed and was committing the offense of possession of marijuana. Officers Markman and Warthen observed a rendezvous between Murphy and Ker on the evening of the arrest which was a virtual reenactment of the previous night's encounter between Murphy, Terrhagen and Sergeant Cook, which concluded in the sale by Murphy to Terrhagen and the Sergeant of a package of marijuana of which the latter had paid Terrhagen for one pound which he received from Terrhagen after the encounter with Murphy. To be sure, the distance and lack of light prevented the officers from seeing and they did not see any substance pass between the two men, but the virtual identity of the surrounding circumstances warranted a strong suspicion that the one remaining element--a sale of narcotics--was a part ofthis encounter as it was the previous night. But Ker's arrest does not depend on this single episode with Murphy. When Ker's U-turn thwarted the officer's pursuit, they learned his name and address from the Department of Motor Vehicles and reported the occurrence to Officer Berman. Berman, in turn, revealed information from an informer whose reliability had been tested previously, as well as from other sources, not only that Ker had been selling marijuana from his apartment but also that his likely source of supply was Murphy himself. That this information was hearsay does not destroy its role in establishing probable cause. Brinegar v. United States,supra. In Draper v. United States, 358 U.S. 307, 79 S.Ct. 329, 3 L.Ed. 327 (1959), we held that information from a reliable informer, corroborated by the agents' observations as to the accuracy of the informer's description of the accused and of his presence at a particular place, was sufficient to establish probable cause for an arrest without warrant.8 The corroborative elements in Draper were innocuous in themselves, but here both the informer's tip and the personal observations connected Ker with specific illegal activities involving the same man, Murphy, a known marijuana dealer. To say that this coincidence of information was sufficient to support a reasonable belief of the officers that Ker was illegally in possession of marijuana is to indulge in understatement.
17
Probable cause for the arrest of petitioner Diane Ker, while not present at the time the officers entered the apartment to arrest her husband, was nevertheless present at the time of her arrest. Upon their entry and announcement of their identity, the officers were met not only by George Ker but also by Diane Ker, who was emerging from the kitchen. Officer Berman immediately walked to the doorway from which she emerged and, without entering, observed the brick-shaped package of marijuana in plain view. Even assuming that her presence in a small room with the contraband in a prominent position on the kitchen sink would not alone establish a reasonable ground for the officers' belief that she was in joint possession with her husband, that fact was accompanied by the officers' information that Ker had been using his apartment as a base of operations for his narcotics activities. Therefore, we cannot say that at the time of her arrest there were not sufficient grounds for a reasonable belief that Drane Ker, as well as her husband, as committing the offense of possession of marijuana in the presence of the officers.
III.
18
It is contended that the lawfulness of the petitioners arrests, even if they were based upon probable cause, was vitiated by the method of entry. This Court, in cases under the Fourth Amendment, was long recognized that the lawfulness of arrests for federal offenses is to be determined by reference to state law insofar as it is not violative of the Federal Constitution. Miller v . United States, supra; United States v. Di Re, 332 U.S. 581, 68 S.Ct. 222, 92 L.Ed. 210 (1948); Johnson v. United States, 333 U.S. 10, 15, n. 5, 68 S.Ct. 367, 370, 92 L.Ed. 436 (1948). A fortiori, the lawfulness of these arrests by state officers for state offenses is to be determined by California law. California Penal Code, § 844,9 permits peace officers to break into a dwelling place for the purpose of arrest after demanding admittance and explaining their purpose. Admittedly the officers did not comply with the terms of this statute since they entered quietly and without announcement, in order to prevent the destruction of contraband. The California District Court of Appeal, however, held that the circumstances here came within a judicial exception which had been engrafted upon the statute by a series of decisions, see, e.g., People v. Ruiz, 146 Cal.App.2d 630, 304 P.2d 1 75 (1956); People v. Maddox, 46 Cal.2d 301, 294 P.2d 6, cert. denied, 352 U.S. 858, 77 S.Ct. 81, 1 L.Ed.2d 6 5 (1956), and that the noncompliance was therefore lawful.
19
Since the petitioner's federal constitutional protection from unreasonable searches and seizures by police officers is here to be determined by whether the search was incident to a lawful arrest, we are warranted in examining that arrest to determine whether, notwithstanding its legality under state law, the method of entering the home may offend federal constitutional standards of reasonableness and therefore vitiate the legality of an accompanying search. We find no such offensiveness on the facts here. Assuming that the officers' entry by use of a key obtained from the manager is the legal equivalent of a 'breaking,' see Keiningham v. United States, 109 U.S.App.D.C. 272, 276, 287 F.2d 126, 130 (1960), it has been recognized from the early common law that such breaking is permissible in executing an arrest under certain circumstances. See Wilgus, Arrest Without a Warrant, 22 mich.L.Rev. 541, 798, 800—806 (1924). Indeed, 18 U.S.C. § 3109,10 dealing with the execution of search warrants by federal officers, authorizes breaking of doors in words very similar to those of the California statute, both statutes including a requirement of notice of authority and purpose. In Miller v. United States, supra, this Court held unlawful an arrest, and therefore its accompanying search, on the ground that the District of Columbia officers before entering a dwelling did not fully satisfy the requirement of disclosing their identity and purpose. The Court stated that 'the lawfulness of the arrest without warrant is to be determined by reference to state law. * * * By like reasoning the validity of the arrest of petitioner is to be determined by reference to the law of the District of Columbia.' 357 U.S., at 305—306, 78 S.Ct., at 1194, 2 L.Ed.2d 1332. The parties there conceded and the Court accepted that the criteria for testing the arrest under District of Columbia law were 'substantially identical' to the requirements of § 3109. Id., 357 U.S., at 306, 78 S.Ct., at 1194, 2 L.Ed.2d 1332. Here, however, the criteria under California law clearly include an exception to the notice requirement where exigent circumstances are present. Moreover, insofar as violation of a federal statute required the exclusion of evidence in Miller, the case is inapposite for state prosecutions, where admissibility is governed by constitutional standards. Finally, the basis of the judicial exception to the California statute, as expressed by Justice Traynor in People v. Maddox, 46 Cal.2d, at 306, 294 P.2d, at 9, effectively answers the petitioners' contention:
20
'It must be borne in mind that the primary purpose of the constitutional guarantees is to prevent unreasonable invasions of the security of the people in their persons, houses, papers, and effects, and when an officer has reasonable cause to enter a dwelling to make an arrest and as an incident to that arrest is authorized to make a reasonable search, his entry and his search are not unreasonable. Suspects have no constitutional right to destroy or dispose of evidence, and no basic constitutional guarantees are violated because an officer succeeds in getting to a place where he is entitled to be more quickly than he would, had he complied with section 844. Moreover, since the demand and explanation requirements of section 844 are a codification of the common law, they may reasonably be interpreted as limited by the common law rules that compliance is not required if the officer's peril would have been increased or the arrest frustrated had he demanded entrance and stated his purpose. Read v. Case, 4 Conn. 166, 170 (10 Am.Dec. 110); see Restatement, Torts, § 206, comment d. Without the benefit of hindsight and ordinarily on the spur of the moment, the officer must decide these questions in the first instance.'
21
No such exigent circumstances as would authorize noncompliance with the California statute were argued in Miller, and the Court expressly refrained from discussing the question, citing the Maddox case without disapproval. 357 U.S., at 309, 78 S.Ct., at 1195—1196, 2 L.Ed.2d 1332.11 Here justification for the officers' failure to give notice is uniquely present. In addition to the officers' belief that Ker was in possession of narcotics, which could be quicky and easily destroyed, Ker's furtive conduct in eluding them shortly before the arrest was ground for the belief that he might well have been expecting the police.12 We therefore hold that in the particular circumstances of this case the officers' method of entry, sanctioned by the law of California, was not unreasonable under the standards of the Fourth Amendment as applied to the States through the Fourteenth Amendment.
IV.
22
Having held the petitioners' arrests lawful, it remains only to consider whether the search which produced the evidence leading to their convictions was lawful as incident to those arrests. The doctrine that a search without warrant may be lawfully conducted if incident to a lawful arrest has long been recognized as consistent with the Fourth Amendment's protection against unreasonable searches and seizures. See Marron v. United States, 275 U.S. 192, 48 S.Ct. 74, 72 L.Ed. 231 (1927); Harris v. United States, 331 U.S. 145, 67 S.Ct. 1098, 91 L.Ed. 1399 (1947); Abel v. United States, 362 U.S. 217, 80 S.Ct. 683, 4 L.Ed.2d 668 (1960); Kaplan, Search and Seizure: A No-Man's Land in the Criminal Law, 49 Cal.L.Rev. 474, 490—493 (1961). The cases have imposed no requirement that the arrest be under authority of an arrest warrant, but only that it be lawful. See Marron v. United States, supra, 275 U.S., at 198—199, 48 S.Ct., at 76—77, 72 L.Ed. 231; United States v. Rabinowitz, supra, 339 U.S., at 61, 70 S.Ct., at 433, 94 L.Ed. 653; cf. Agnello v. United States, 269 U.S. 20, 30 31, 46 S.Ct. 4, 5—6, 70 L.Ed. 145 (1925). The question remains whether the officers' action here exceeded the recognized bounds of an incidental search.
23
Petitioners contend that the search was unreasonable in that the officers could practicably have obtained a search warrant. The practicability of obtaining a warrant is not the controlling factor when a search is sought to be justified as incident to arrest, United States v. Rabinowitz, supra; but we need not rest the validity of the search here on Rabinowitz, since we agree with the California court that time clearly was of the essence. The officers' observations and their corroboration, which furnished probable cause for George Ker's arrest, occurred at about 9 p.m., approximately one hour before the time of arrest. The officers had reason to act quickly because of Ker's furtive conduct and the likelihood that the marijuana would be distributed or hidden before a warrant could be obtained at that time of night.13 Thus the facts bear no resemblance to those in Trupiano v. United States, 334 U.S. 699, 68 S.Ct. 1229, 92 L.Ed. 1663 (1948), where federal agents for three weeks had been in possession of knowledge sufficient to secure a search warrant.
24
The search of the petitioners' apartment was well within the limits upheld in Harris v. United States, supr a, which also concerned a private apartment dwelling. The evidence here, unlike that in Harris, was the isntrumentality of the very crime for which petitioners were arrested, and the record does not indicate that the search here was an extensive in time or in area as that upheld in Harris.
25
The petitioners' only remaining contention is that the discovery of the brick of marijuana cannot be justified as incidental to arrest since it preceded the arrest. This contention is of course contrary to George Ker's testimony, but we reject it in any event. While an arrest may not be used merely as the pretext for a search without warrant, the California court specifically found and the record supports both that the officers entered the apartment for the purpose of arresting George Ker and that they had probable cause to make that arrest prior to the entry.14 We cannot say that it was unreasonable for Officer Berman, upon seeing Diane Ker emerge from the kitchen, merely to walk to the doorway of that adjacent room. We thus agree with the California court's holding that the discovery of the brick of marijuana did not constitute a search, since the officer merely saw what was placed before him in full view. United States v. Lee, 274 U.S. 559, 47 S.Ct. 746, 71 L.Ed. 1202 (1927); United States v. Lefkowitz, 285 U.S. 452, 465, 52 S.Ct. 420, 423, 76 L.Ed. 877 (1932); People v. West, 144 Cal.App.2d 214, 300 P.2d 729 (1956). Therefore, while California law does not require that an arrest precede an incidental search as long as probable cause exists at the outset, Wilson v. Superior Court, 46 Cal.2d 291, 294 P.2d 36 (1956), the California court did not rely on that rule and we need not reach the question of its status under the Federal Constitution.
V.
26
The petitioners state and the record bears out that the officers searched Diane Ker's automobile on the day subsequent to her arrest. The reasonableness of that search, however, was not raised in the petition for certiorari, nor was it discussed in the brief here. Ordinarily '(w)e do not reach for constitutional questions not raised by the parties,' Mazer v. Stein, 347 U.S. 201, 206, n. 5, 74 S.Ct. 460, 464, 98 L.Ed. 630 (1954), nor extend our review beyond those specific federal questions properly raised in the state court. The record gives no indication that the issue was raised in the trial court or in the District Court of Appeal, the latter court did not adjudicate it and we therefore find no reason to reach it on the record.15
27
For these reasons the judgment of the California District Court of Appeal is affirmed.
28
Affirmed.
29
Mr. Justice HARLAN (concurring in the result).
30
Heretofore there has been a well-established line of demarcation between the constitutional principles governing the standards for state searches and seizures and those controlling federal activity of this kind. Federal searches and seizures have been subject to the requirement of 'reasonableness' contained in the Fourth Amendment, as that requirement has been elaborated over the years in federal litigation. State searches and seizures, on the other hand, have been judged, and in my view properly so, by the more flexible concept of 'fundamental' fairness, of rights 'basic to a free society,' embraced in the Due Process Clause of the Fourteenth Amendment. See Wolf v. Colorado, 338 U.S. 25, 27, 69 S.Ct. 1359, 1361, 93 L.Ed. 1782;* cf. Rochin v. California, 342 U.S. 165, 72 S.Ct. 205, 96 L.Ed. 183; Palko v. Connecticut, 302 U.S. 319, 58 S.Ct .149, 82 L.Ed. 288. Today this distinction in constitutional principle is abandoned. Henceforth state searches and seizures are to be judged by the same constitutional standards as apply in the federal system.
31
In my opinion this further extension of federal power over state criminal cases, cf. Fay v. Noia, 372 U.S. 391, 83 S.Ct. 822, 9 L.Ed.2d 837; Douglas v. California, 372 U.S. 353, 83 S.Ct. 814, 9 L.Ed.2d 811; Draper v. Washington, 372 U .S. 487, 83 S.Ct. 774, 9 L.Ed.2d 899—all decided only a few weeks ago, is quite uncalled for and unwise. It is uncalled for because the States generally, and more particularly California, are increasingly evidencing concern about improving their own criminal procedures, as this Court itself has recently observed on more than one occasion (see Gideon v. Wainwright, 372 U.S. 335, 345, 83 S.Ct. 792, 797, 9 L.Ed.2d 799; ante, p. 31), and because the Fourteenth Amendment's requirements of fundamental fairness stand as a bulwark against serious local shortcomings in this field. The rule is unwise because the States, with their differing law enforcement problems, should not be put in a constitutional straitjacket, and also because the States, more likely than not, will be placed in an atmosphere of uncertainty since this Court's decisions in the realm of search and seizure are hardly notable for their predictability. Cf. Harris v. United States, 331 U.S. 145, 175 181, 67 S.Ct. 1098, 1121—1128, 91 L.Ed. 1399 (Appendix to dissenting opinion of Mr. Justice Frankfurter). (The latter point is indeed forcefully illustrated by the fact that in the first application of its new constitutional rule the majority finds itself equally divided.) And if the Court is prepared to relax Fourth Amendment standards in order to avoid unduly fettering the States, this would be in derogation of law enforcement standards in the federal system unless the Fourth Amendment is to mean one thing for the States and something else for the Federal Government.
32
I can see no good coming from this constitutional adventure. In judging state searches and seizures I would continue to adhere to established Fourteenth Amendment concepts of fundamental fairness. So judging this case, I concur in the result.
33
Mr. Justice BRENNAN, with whom THE CHIEF JUSTICE, Mr. Justice DOUGLAS and Mr. Justice GOLDBERG join.
34
I join Part I of Mr. Justice CLARK's opinion and the holding therein that 'as we said in Mapp * * * the Fourth Amendment 'is enforceable against * * * (the States) by the same sanction of exclusion as is used against the Federal Government,' by the application of the same constitutional standard prohibiting 'unreasonable searches and seizures." Only our Brother HARLAN dissents from that holding; he would judge state searches and seizures 'by the more flexible concept of 'fundamental' fairness, of rights 'basic to a free society,' embraced in the Due Process Clause of the Fourteenth Amendment.'
35
However, Mr. Justice CLARK, Mr. Justice BLACK, Mr. Justice STEWART and Mr. Justice WHITE do not believe that the federal requirement of reasonableness contained in the Fourth Amendment was violated in this case. THE CHIEF JUSTICE, Mr. Justice DOUGLAS, Mr. Justice GOLDBERG and I have the contrary view. For even on the premise that there was probable cause by federal standards for the arrest of George Ker, the arrests of these petitioners were nevertheless illegal, because the unannounced intrusion of the arresting officers into their apartment violated the Fourth Amendment. Since the arrests were illegal, Mapp v. Ohio, 367 U.S. 643, 81 S.Ct. 1684, 7 L.Ed.2d 1081, requires the exclusion of the evidence which was the product of the search incident to those arrests.
36
Even if probable cause exists for the arrest of a person within, the Fourth Amendment is violated by an unannounced police intrusion into a private home, with or without an arrest warrant, except (1) where the persons within already know of the officers' authority and purpose, or (2) where the officers are justified in the belief that persons within are in imminent peril of bodily harm, or (3) where those within, made aware of the presence of someone outside (because, for example, there has been a knock at the door), are then engaged in activity which justifies the officers in the belief that an escape or the destruction of evidence is being attempted.
I.
37
It was firmly established long before the adoption of the Bill of Rights that the fundamental liberty of the individual includes protection against unannounced police entries. '(T)he Fourth Amendment did but embody a principle of English liberty, a principle old, yet newly won, that finds another expression in the maxim 'every man's home is his castle." Fraenkel, Concerning Searches and Seizures, 34 Harv.L.Rev. 361, 365 (1921); Frank v. Maryland, 359 U.S. 360, 376—382, 79 S.Ct. 804, 813—817, 3 L.Ed.2d 877 (dissenting opinion). As early as Semayne's Case, 5 Co.Rep. 91a, 91b, 77 Eng.Rep. 194, 195 (1603), it was declared that '(i)n all cases when the King is party, the sheriff (if the doors be not open) may break the party's house, either to arrest him, or to do other execution of the K(ing)'s process, if otherwise he cannot enter. But before he breaks it, he ought to signify the cause of his coming, and to make request to open doors * * *.' (Emphasis supplied.) Over a century later the leading commentators upon the English criminal law affirmed the continuing vitality of that principle. 1 Hale, Pleas of the Crown (1736), 583; see also 2 Hawkins, Pleas of the Crown (6th ed. 1787), c. 14, § 1; Foster, Crown Law (1762), 320—321.1 Perhaps its most emphatic confirmation was supplied only 35 years before the ratification of the Bill of Rights. In Curtis' Case, Fost. 135, 168 Eng.Rep. 67, decided in 1756, the defendant, on trial for the murder of a Crown officer who was attempting an entry to serve an arrest warrant, pleaded that because the officer had failed adequately to announce himself and his mission before breaking the doors, forceful resistance to his entry was justified and the killing was therefore justifiable homicide. In recognizing the defense the court repeated the principle that 'peace-officers, having a legal warrant to arrest for a breach of the peace, may break open doors, after having demanded admittance and given due notice of their warrant'; the court continued that 'no precise form of words is required in a case of this kind' because '(i)t is sufficient that the party hath notice, that the officer cometh not as a mere trespasser, but claiming to act under a proper authority * * *.' Fost., at 136 137, 168 Eng.Rep., at 68. (Emphasis supplied.) The principle was again confirmed not long after the Fourth Amendment became part of our Constitution. Abbott, C.J., said in Launock v. Brown, 2 B. & Ald. 592, 593—594, 106 Eng.Rep. 482, 483 (1819):
38
'* * * I am clearly of opinion that, in the case of a misdemeanour, such previous demand is requisite * * *. It is reasonable that the law should be so; for if no previous demand is made, how is it possible for a party to know what the object of the person breaking open the door may be? He has a right to consider it as an aggression on his private property, which he will be justified in resisting to the utmost.'2
39
The protections of individual freedom carried into the Fourth Amendment, Boyd v. United States, 116 U.S. 616, 630, 6 S.Ct. 524, 532, 29 L.Ed. 746, undoubtedly included this firmly established requirement of an announcement by police officers of purpose and authority before breaking into an individual's home. The requirement is no mere procedural nicety or formality attendant upon the service of a warrant. Decisions in both the federal and state courts have recognized, as did the English courts, that the requirement is of the essence of the substantive protections which safeguard individual liberty.3 The Court of Appeals for the District of Columbia Circuit has said:
40
'* * * there is no division of opinion among the learned authors * * * that even where an officer may have power to break open a door without a warrant, he cannot lawfully do so unless he first notifies the occupants as to the purpose of his demand for entry.' Accarino v. United States, 85 U.S.App.D.C. 394, 400, 179 F.2d 456, 462. Similarly, the Supreme Judicial Court of Massachusetts declared in 1852:
41
'The maxim of law that every man's house is his castle * * * has not the effect to restrain an officer of the law from breaking and entering a dwelling-house for the purpose of serving a criminal process upon the occupant. In such case the house of the party is no sanctuary for him, and the same may be forcibly entered by such officer after a proper notification of the purpose of the entry, and a demand upon the inmates to open the house, and a refusal by them to do so.' Barnard v. Bartlett, 10 Cush. (Mass.) 501, 502—503; cf. State v. Smith, 1 N.H. 346.
42
Courts of the frontier States also enforced the requirement. For example, Tennessee's high court recognized that a police officer might break into a home to serve an arrest warrant only 'after, demand for admittance and notice of his purpose,' McCaslin v. McCord, 116 Tenn. 690, 708, 94 S.W. 79, 83 ; cf. Hawkins v. Commonwealth, 14 B.Mon. (53 Ky.) 395. Indeed, a majority of the States have enacted the requirement in statutes substantially similar to California Penal Code § 844 and the federal statute, 18 U.S.C. § 3109.4
43
Moreover, in addition to carrying forward the protections already afforded by English law, the Framers also meant by the Fourth Amendment to eliminate once and for all the odious practice of searches under general warrants and writs of assistance against which English law had generally left them helpless. The colonial experience under the writs was unmistakably 'fresh in the memories of those who achieved our independence and established our form of government.'5 Boyd v. United States, supra, 116 U.S., at 625, 6 S.Ct., at 529, 29 L.Ed. 746. The problem of entry under a general warrant was not, of course, exactly that of unannounced intrusion to arrest with a warrant or upon probable cause, but the two practices clearly invited common abuses. One of the grounds of James Otis' eloquent indictment of the writs bears repetition here:
44
'Now one of the most essential branches of English liberty is the freedom of one's house. A man's house is his castle; and whilst he is quiet he is as well guarded as a prince in his castle. This writ, if it should be declared legal, would totally annihilate this privilege. Customhouse officers may enter our houses when they please; we are commanded to permit their entry. Their menial servants may enter, may break locks, bars, and everything in their way: and whether they break through malice or revenge, no man, no court, can inquire. Bare suspicion without oath is sufficient.' Tudor, Life of James Otis (1823), 66—67.
45
Similar, if not the same, dangers to individual liberty are involved in unannounced intrusions of the police into the homes of citizens. Indeed in two respects such intrusions are even more offensive to the sanctity and privacy of the home. In the first place service of the general warrants and writs of assistance was usually preceded at least by some form of notice or demand for admission. In the second place the writs of assistance by their very terms might be served only during daylight hours.6 By significant contrast, the unannounced entry of the Ker apartment occurred after dark, and such timing appears to be common police practice, at least in California.7
46
It is much too late in the day to deny that a lawful entry is as essential to vindication of the protections of the Fourth Amendment as, for example, probable cause to arrest or a search warrant for a search not incidental to an arrest. This Court settled in Gouled v. United States, 255 U.S. 298, 305—306, 41 S.Ct. 261, 263, 65 L.Ed. 647, that a lawful entry is the indispensable predicate of a reasonable search. We held there that a search would violate the Fourth Amendment if the entry were illegal whether accomplished 'by force or by an illegal threat or show of force' or 'obtained by stealth instead of by force or coercion.' Similarly, rigid restrictions upon unannounced entries are essential if the Fourth Amendment's prohibition against invasion of the security and privacy of the home is to have any meaning.
47
It is true, of course, that the only decision of this Court which forbids federal officers to arrest and search after an unannounced entry, Miller v. United States, 357 U.S. 301, 78 S.Ct. 1190, 2 L.Ed.2d 1332, did not rest upon constitutional doctrine but rather upon an exercise of this Court's supervisory powers. But that disposition in no way implied that the same result was not compelled by the Fourth Amendment. Miller is simply an instance of the usual practice of the Court not to decide constitutional questions when a nonconstitutional basis for decision is available. See International Assn. of Machinists v. Street, 367 U.S. 740, 749—750, 81 S.Ct. 1784, 1789—1790, 6 L.Ed.2d 1141. The result there drew upon analogy to a federal statute, similar in its terms to § 844, with which the federal officers concededly had not complied in entering to make an arrest. Nothing we said in Miller so much as intimated that, without such a basis for decision, the Fourth Amendment would not have required the same result. The implication, indeed, is quite to the conary. For the history adduced in Miller in support of the nonconstitutional ground persuasively demonstrates that the Fourth Amendment's protections include the security of the householder against unannounced invasions by the police.
II.
48
The command of the Fourth Amendment reflects the lesson of history that 'the breaking an outer door is, in general, so violent, obnoxious and dangerous a proceeding, that it should be adopted only in extreme cases, where an immediate arrest is requisite.' 1 Burn, Justice of the Peace (28th ed. 1837), 275—276.
49
I have found no English decision which clearly recognizes any exception to the requirement that the police first give notice of their authority and purpose before forcibly entering a home: Exceptions were early sanctioned in American cases, e.g., Read v. Case, 4 Conn. 166, but these were rigidly and narrowly confined to situations not within the reason and spirit of the general requirement. Specifically, exceptional circumstances have been thought to exist only when, as one element, the facts surrounding the particular entry support a finding that those within actually knew or must have known of the officer's presence and purpose to seek admission. Cf. Miller v. United States, supra, 357 U.S., at 311—313, 78 S.Ct., at 1196—1198, 2 L.Ed.2d 1332. For example, the earliest exception seems to have been that '(i)n the case of an escape after arrest, the officer, on fresh pursuit of the offender to a house in which he takes refuge, may break the doors to recapture him, in the case of felony, without a warrant, and without notice or demand for admission to the house of the offender.'8 Wilgus, Arrest Without a Warrant, 22 Mich.L.Rev. 541, 798, 804 (1924). The rationale of such an exception is clear, and serves to underscore the consistency and the purpose of the general requirement of notice: Where such circumstances as an escape and hot pursuit by the arresting officer leave no doubt that the fleeing felon is aware of the officer's presence and purpose, pausing at the threshold to make the ordinarily requisite announcement and demand would be a superfluous act which the law does not require.9 But no exceptions have heretofore permitted unannounced entries in the absence of such awareness on the part of the occupants—unless possibly where the officers are justified in the belief that someone within is in immediate danger of bodily harm.
50
Two reasons rooted in the Constitution clearly compel the courts to refuse to recognize exceptions in other situations when there is no showing that those within were or had been made aware of the officers' presence. The first is that any exception not requiring a showing of such awareness necessarily implies a rejection of the inviolable presumption of innocence. The excuse for failing to knock or announce the officer's mission where the occupants are oblivious to his presence can only be an almost automatic assumption that the suspect within will resist the officer's attempt to enter peacefully, or will frustrate the arrest by an attempt to escape, or will attempt to destroy whatever possibly incriminating evidence he may have. Such assumptions do obvious violence to the presumption of innocence. Indeed, the violence is compounded by another assumption, also necessarily involved, that a suspect to whom the officer first makes known his presence will further violate the law. It need hardly be said that not every suspect is in fact guilty of the offense of which he is suspected, and that not everyone who is in fact guilty will forcibly resist arrest or attempt to escape or destroy evidence.10
51
The second reason is that in the absence of a showing of awareness by the occupants of the officers' presence and purpose, 'loud noises' or 'running' within would amount, ordinarily, at least, only to ambiguous conduct. Our decisions in related contexts have held that ambiguous conduct cannot form the basis for a belief of the officers that an escape or the destruction of evidence is being attempted. Wong Sun v. United States, 371 U.S. 471, 483—484, 83 S.Ct. 407, 415—416, 9 L.Ed.2d 441; Miller v. United States, supra, 357 U.S., at 311, 78 S.Ct., at 1196—1197, 2 L.Ed.2d 1332.
52
Beyond these constitutional considerations, practical hazards of law enforcement militate strongly against any relaxation of the requirement of awareness. First, cases of mistaken identity are surely not novel in the investigation of crime. The possibility is very real that the police may be misinformed as to the name or address of a suspect, or as to other material information. That possibility is itself a good reason for holding a tight rein against judicial approval of unannounced police entries into private homes. Innocent citizens should not suffer the shock, fright or embarrassment attendant upon an unannounced police intrusion.11 Second, the requirement of awareness also serves to minimize the hazards of the officers' dangerous calling. We expressly recognized in Miller v. United States, supra, 357 U.S., at 313, n. 12, 78 S.Ct., at 1198, 2 L.Ed.2d 1332, that compliance with the federal notice statute 'is also a safeguard for the police themselves who might be mistaken for prowlers and be shot down by a fearful householder.'12 Indeed, one of the principal objectives of the English requirement of announcement of authority and purpose was to protect the arresting officers from being shot as trespassers, '* * * for if no previous demand is made, how is it possible for a party to know what the object of the person breaking open the door may be? He has a right to consider it as an aggression on his private property, which he will be justified in resisting to the utmost.' Launock v. Brown, 2 B. & Ald. 592, 594, 106 Eng.Rep. 482, 483 (1819).
53
These compelling considerations underlie the constitutional barrier against recognition of exceptions not predicated on knowledge or awareness of the officers' presence. State and federal officers have the common obligation to respect this basic constitutional limitation upon their police activities. I reject the contention that the courts, in enforcing such respect on the part of all officers, state or federal, create serious obstacles to effective law enforcement. Federal officers have operated for five years under the Miller rule with no discernible impairment of their ability to make effective arrests and obtain important narcotics convictions. Even if it were true that state and city police are generally less experienced or less resourceful than their federal counterparts (and the experience of the very police force involved in this case, under California's general exclusionary rule adopted judicially in 1955, goes very far toward refuting any such suggestion,13 see Elkins v. United States, 364 U.S. 206, 220—221, 80 S.Ct. 1437, 1445—1446, 4 L.Ed.2d 1669), the Fourth Amendment's protections against unlawful search and seizure do not contract or expand depending upon the relative experience and resourcefulness of different groups of law-enforcement officers. When we declared in Mapp that, because the rights of the Fourth Amendment were of no lesser dignity than those of the other liberties of the Bill of Rights absorbed in the Fourteenth, '* * * we can no longer permit (them) to be revocable at the whim of any police officer who, in the name of law enforcement itself, chooses to suspend (their) enjoyment,' 367 U.S., at 660, 81 S.Ct., at 1694, 6 L.Ed.2d 1081—I thought by these words we had laid to rest the very problems of constitutional dissonance which I fear the present case so soon revives.14
III.
54
I turn now to my reasons for believing that the arrests of these petitioners were illegal. My Brother CLARK apparently recognizes that the element of the Kers' prior awareness of the officers' presence was essential, or at least highly relevant, to the validity of the officers' unannounced entry into the Ker apartment, for he says 'Ker's furtive conduct in eluding them shortly before the arrest was ground for the belief that he might well have been expecting the police.' (Emphasis supplied.) But the test under the 'fresh pursuit' exception which my Brother CLARK apparently seeks to invoke depends not, of course, upon mere conjecture whether those within 'might well have been' expecting the police, but upon whether there is evidence which shows that the occupants were in fact aware that the police were about to visit them. That the Kers were wholly obvious to the officers' presence is the only possible inference on the uncontradicted facts; the 'fresh pursuit' exception is therefore clearly unavailable. When the officers let themselves in with the passkey, 'proceeding quietly,' as my Brother CLARK says, George Ker was sitting in his living room reading a newspaper, and his wife was busy in the kitchen. The marijuana, moreover, was in full view on the top of the kitchen sink. More convincing evidence of the complete unawareness of an imminent police visit can hardly be imagined. Indeed, even the conjecture that the Kers 'might well have been expecting the police' has no support in the record. That conjecture is made to rest entirely upon the unexplained U-turn made by Ker's car when the officers lost him after the rendezvous at the oil fields. But surely the U-turn must be disregarded as wholly ambiguous conduct; there is absolutely no proof that the driver of the Ker car knew that the officers were following it. Cf. Miller v. United States, supra, 357 U.S., at 311, 75 S.Ct., at 1196—1197, 2 L.Ed.2d 1332; Wong Sun v. United States, supra, 371 U.S., at 483—484, 83 S.Ct., at 415—416, 9 L.Ed.2d 441.
55
My Brother CLARK invokes chiefly, however, the exception allowing an unannounced entry when officers have reason to believe that someone within is attempting to destroy evidence. But the minimal conditions for the application of that exception are not present in this case. On the uncontradicted record, not only were the Kers completely unaware of the officers' presence, but, again on the uncontradicted record, there was absolutely no activity within the apartment to justify the officers in the belief that anyone within was attempting to destroy evidence. Plainly enough, the Kers left the marijuana in full view on top of the sink because they were wholly oblivious that the police were on their trial. My Brother CLARK recognizes that there is no evidence whatever of activity in the apartment, and is thus forced to find the requisite support for this element of the exception in the officers' testimony that, in their experience in the investigation of narcotics violations, other narcotics suspects had responded to police announcements by attempting to destroy evidence. Clearly such a basis for the exception fails to meet the requirements of the Fourth Amendment; if police experience in pursuing other narcotics suspects justified an unannounced police intrusion into a home, the Fourth Amendment would afford no protection at all.
56
The recognition of exceptions to great principles always creates, of course, the hazard that the exceptions will devour the rule. If mere police experience that some offenders have attempted to destroy contraband justifies unannounced entry in any case, and cures the total absence of evidence not only of awareness of the officers' presence but even of such an attempt in the particular case, I perceive no logical basis for distinguishing unannounced police entries into homes to make arrests for any crime involving evidence of a kind which police experience indicates might be quickly destroyed or jettisoned. Moreover, if such experience, without more, completely excuses the failure of arresting officers before entry, at any hour of the day or night, either to announce their purpose at the threshold or to ascertain that the occupant already knows of their presence, then there is likewise no logical ground for distinguishing between the stealthy manner in which the entry in this case was effected, and the more violent manner usually associated with totalitarian police of breaking down the door or smashing the lock.15
57
My Brother CLARK correctly states that only when state law 'is not violative of the Federal Constitution' may we defer to state law in gauging the validity of an arrest under the Fourth Amendment. Since the California law of arrest here called in question patently violates the Fourth Amendment, that law cannot constitutionally provide the basis for affirming these convictions. This is not a case of conflicting testimony pro and con the existence of the elements requisite for finding a basis for the application of the exception. I agree that we should ordinarily be constrained to accept the state fact-finder's resolution of such factual conflicts. Here, however, the facts are uncontradicted: the Kers were comletely oblivious of the presence of the officers and were engaged in no activity of any kind indicating that they were attempting to destroy narcotics. Our duty then is only to decide whether the officers' testimony—that in their general experience narcotics suspects destroy evidence when forewarned of the officers' presence—satisfies the constitutional test for application of the exception. Manifestly we should hold that such testimony does not satisfy the constitutional test. The subjective judgment of the police officers cannot constitutionally be a substitute for what has always been considered a necessarily objective inquiry,16 namely, whether circumstances exist in the particular case which allow an unannounced police entry.17
58
We have no occasion here to decide how many of the situations in which, by the exercise of our supervisory power over the conduct of federal officers, we would exclude evidence, are also situations which would require the exclusion of evidence from state criminal proceedings under the constitutional principles extended to the States by Mapp. But where the conduct effecting an arrest so clearly transgresses those rights guaranteed by the Fourth Amendment as does the conduct which brought about the arrest of these petitioners, we would surely reverse the judgment if this were a federal prosecution involving federal officers. Since our decision in Mapp has made the guarantees of the Fourteenth Amendment coextensive with those of the Fourth we should pronounce precisely the same judgment upon the conduct of these state officers.
1
This contention was initially raised prior to the trial. Section 995, California Penal Code, provides for a motion to set aside the information on the ground that the defendant has been committed without probable cause. Evidence on that issue was presented out of the presence of the jury, and, following the court's denial of the motion, the petitioners were tried and convicted by the jury.
2
During the hearing on the § 995 motion, see note 1, supra, Black testified for the defense, admitting that he knew the petitioners but denying that he gave Officer Berman information about George Ker. Black first denied but then admitted that he had met with Officer Berman and another officer in whose presence Berman said the information about Ker was given.
3
Arresting Officers Berman and Warthen had been attached to the narcotics detail of the Los Angeles County Sheriff's office for three and four years, respectively. Each had participated in hundreds of arrests involving marijuana. Warthen testified that on 'many, many occasions' in his experience with narcotics arrests 'persons have flushed narcotics down toilets, pushed them down drains and sinks and many other methods of getting rid of them prior to my entrance * * *.'
4
For the reasons discussed in § V of this opinion, we find that the validity of the search of the automobile is not before us and we therefore do not pass on it.
5
'The right of the people to be secure in their persons, houses, papers and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.'
6
'No person * * * shall be compelled in any criminal case to be a witness against himself * * *.'
7
Our holding as to enforceability of this federal constitutional rule against the States had its source in the following declaration in Wolf v. Colorado, 338 U.S. 25, 27—28, 69 S.Ct. 1359, 1361, 93 L. .Ed. 1782 (1949):
'The security of one's privacy against arbitrary intrusion by the police—which is at the core of the Fourth Amendment—is * * * implicit in 'the concept of ordered liberty' and as such enforceable against the States through the Due Process Clause.'
8
In Draper the arrest upon probable cause was authorized under 26 U.S.C. § 7607, authorizing narcotics agents to make an arrest without warrant if they have 'reasonable grounds to believe that the person to be arrested has committed or is committing such violation.' Under § 836, California Penal Code, an officer may arrest without a warrant if he has 'reasonable cause to believe that the person to be arrested has committed a felony * * *.'
9
'To make an arrest, * * * in all cases a peace officer, may break open the door or window of the house in which the person to be arrested is, or in which * * * (he has) reasonable grounds for believing him to be, after having demanded admittance and explained the purpose for which admittance is desired.'
10
'The officer may break open any outer or inner door or window of a house, or any part of a house, or anything therein, to execute a search warrant, if, after notice of his authority and purpose, he is refused admittance or when necessary to liberate himself or a person aiding him in the execution of the warrant.'
11
Nor has the Court rejected the proposition that noncompliance may be reasonable in exigent circumstances subsequent to Miller. In Wong Sun v. United States, 371 U.S. 471, 83 S.Ct. 407, 9 L.Ed.2d 441 (1963), the Court held that federal officers had not complied with § 3109 in executing an arrest . There the Court noted that in Miller it had reserved the question of an exception in exigent circumstances and stated that '(h)ere, as in Miller, the Government claims no extraordinary circumstances such as the imminent destruction of vital evidence, or the need to rescue a victim in peril—* * * which excused the officer's failure truthfully to state his mission before he broke in.' Id., 371 U.S ., at 483—484, 83 S.Ct., at 415, 9 L.Ed.2d 441
12
A search of the record with the aid of hindsight may lend some support to the conclusion that, contra the reasonable belief of the officers, petitioners may not have been prepared for an imminent visit from the police. It goes without saying that in determining the lawfulness of entry and the existence of probable cause we may concern ourselves only with what the officers had reason to believe at the time of their entry. Johnson v. United States, 333 U.S. 10, 17, 68 S.Ct. 367, 370—371, 92 L.Ed. 436 (1948). As the Court said in United States v. Di Re, 332 U.S. 581, 595, 68 S.Ct. 222, 229, 92 L.Ed. 210 (1948), 'a search is not to be made legal by what it turns up. In law it is good or bad when it starts and does not change character from' what is dug up subsequently. (Emphasis added.)
13
In cases in which a search could not be regarded as incident to arrest because the petitioner was not present at the time of the entry and search, the absence of compelling circumstances, such as the threat of destruction of evidence, supported the Court's holdings that searches without warrants were unconstitutional. See Chapman v. United States, 365 U.S. 610, 615, 81 S.Ct. 776, 779, 5 L.Ed.2d 828 (1961); United States v. Jeffers, 342 U.S. 48, 52, 72 S.Ct. 93, 95—96, 96 L.Ed. 59 (1951); Taylor v. United States, 286 U.S. 1, 5, 52 S.Ct. 466, 467, 76 L.Ed. 951 (1932).
14
Compare Johnson v. United States, note 12, supra, at 40. There the Court held that a search could not be justified as incident to arrest since the officers, prior to their entry into a hotel room, had no probable cause for the arrest of the occupant. The Court stated that '(a)n officer gaining access to private living quarters under color of his office and of the law which he personifies must then have some valid basis in law for the intrusion.' Here, of course, probable cause for the arrest of petitioner George Ker provided that valid basis.
15
The record shows that petitioners made no objection to the admission of any of the evidence, thus failing to observe a state procedural requirement. People v. Brittain, 149 Cal.App.2d 201, 308 P.2d 38 (1957); see Mapp v. Ohio, supra, 367 U.S., at 659, n. 9, 81 S.Ct., at 1693, 6 L.Ed.2d 1081. However, the District Court of Appeal passed on the issue of the narcotics seized in the apartment, presumably on the ground that petitioners preserved that question by their motion under § 995, California Penal Code, which was directed toward the principal objection to that search—the alleged lack of probable cause. While '(t)here can be no question as to the proper presentation of a federal claim when the highest state court passes on it,' Raley v. Ohio, 360 U.S. 423, 436, 79 S.Ct. 1257, 1265, 3 L.Ed.2d 1344(1959), thereisnoindicationinthecourt'sopinionth, noristhereanyindicationinthepetitioners'.
*
Mapp v. Ohio, 367 U.S. 643, 81 S.Ct. 1684, 6 L.Ed.2d 1081, did not purport to change the standards by which state searches and seizures were to be judged; rather it held only that the 'exclusionary' rule of Weeks v. United States, 232 U.S. 383, 34 S.Ct. 341, 58 L.Ed. 652, was applicable to the States.
1
Hale's view was representative: 'A man, that arrests upon suspicion of felony, may break open doors, if the party refuse upon demand to open them * * *.' 1 Hale, Pleas of the Crown (1736), 583. See generally Miller v. United States, 357 U.S. 301, 306—310, 78 § .Ct. 1190, 1194—1196, 2 L.Ed.2d 1332; Accarino v. United States, 85 U.S.App .D.C. 394, 398—402, 179 F.2d 456, 460 464 ; Thomas, The Execution of Warrants of Arrest, (1962) Crim.L.Rev. 520, 597, 601—604.
2
Compare also the statement of Bayley, J., in Burdett v. Abbot, 14 East. 1, 162—163, 104 Eng.Rep. 501 , 563 (1811):
'Now in every breach of the peace the public are considered as interested, and the execution of process against the offender is the assertion of a public right: and in all such cases, I apprehend that the officer has a right to break open the outer door, provided there is a request of admission first made for the purpose, and a denial of the parties who are within.'
See also Ratcliffe v. Burton, 3 Bos. & Pul. 223, 127 Eng.Rep. 123 (1802); Kerbey v. Denby, 1 M . & W. 336, 150 Eng.Rep. 463 (1836); cf. Park v. Evans, Hob. 62, 80 Eng.Rep. 211; Penton v. Brown, 1 Keble 698, 83 Eng.Rep. 1193; Percival v. Stamp, 9 Ex. 167, 156 Eng.Rep. 71¢ Y (1853).
3
See generally Gatewood v. United States, 93 U.S.App.D.C. 226, 229, 209 F.2d 789, 791; 1 Bishop, New Criminal Procedure (2d ed. 1913), § 201; 1 Varon, Searches, Seizures and Immunities (1961), 399—401; Day and Berkman, Search and Seizure and the Exclusionary Rule; A Re-Examination in the Wake of Mapp v. Ohio, 13 West.Res.L.Rev. 5 6, 79—80 (1961).
4
Ala.Code, Tit. 15, § 155; Ariz.Rev.Stat.Ann. § 13—1411; Deering's Cal.Penal Code § 844; Fla.Stat.Ann. § 901.19(1); Idaho Code § 19—611; Burns' Ind.Ann.Stat. § 9—1009; Iowa Code Ann. § 755.9; Kan.Gen.Stat. § 62—1819; Ky.Rev.Stat. § 70.078; Dart's La.Crim.Code, Art. 72; Mich.Stat.Ann. § 28.880, Comp.Laws 1948, § 764.21; Minn.Stat.Ann. § 629.34; Miss.Code § 2471; Mo.Rev.Stat. § 544.200; Mont.Rev.Code § 94—6011; Neb.Rev.Stat. § 29—411; Nev.Rev.Stat. § 171.275; McKinney's N.Y.Crim.Code § 178; N.C.Gen.Stat. § 15—44; Page's Ohio Rev.Code Ann. § 2935.15; Okla.Stat.Ann., Tit. 22, § 194; Ore.Rev.Stat. § 133.320; S.C.Code § 53—198; S.D.Code § 34.1606; Tenn.Code Ann. § 40—807; Utah Code Ann. 77—13—12; Wash.Rev.Code § 10.31.040; Wyo.Comp.Stat. § 10—309.
Compare Code of Crim.Proc., American Law Institute, Official Draft (1930), § 28:
'Right of officer to break into building. An officer, in order to make an arrest either by virtue of a warrant, or when authorized to make such arrest for a felony without a warrant, as provided in section 21, may break open a door or window of any building in which the person to be arrested is or is reasonably believed to be, if he is refused admittance after he has announced his authority and purpose.'
5
See also Henry v. United States, 361 U.S. 98, 100—101, 80 S.Ct. 168, 169—171, 4 L.Ed.2d 134; Lasson, The History and Development of the Fourth Amendment to the United States Constitution (1937), c. II; Barrett, Personal Rights, Property Rights, and the Fourth Amendment, 1960 Supreme Court Review 46, 70 71; Comment, Search and Seizure in the Supreme Court: Shadows on the Fourth Amendment, 28 U. of Chi.L.Rev. 664, 678—679 (1961). Compare East-India Co. v. Skinner, Comb. 342, 90 Eng.Rep. 516.
6
Lasson, The History and Development of the Fourth Amendment to the United States Constitution (1937), 54.
7
In these two respects, the practice of unannounced police entries by night is also considerably more offensive to the rights protected by the Fourth Amendment than the use of health-inspection and other administrative powers of entry, concerning the constitutionality of which this Court has divided sharply, Frank v. Maryland, supra; Ohio ex rel. Eaton v. Price, 364 U.S. 263, 80 S.Ct. 1463, 4 L.Ed.2d 1708. Since my Brother CLARK does not rely upon either of those decisions, I have no occasion to discuss further the applicability of either to the case at bar. For further consideration of problems raised by those cases, see generally, Waters, Rights of Entry in Administrative Officers, 27 U. of Chi.L.Rev. 79 (1959); Comment, State Health Inspections and 'Unreasonable Search': The Frank Exclusion of Civil Searches, 44 Minn.L.Rev. 513 (1960).
8
It is not clear whether the English law ever recognized such an exception to the requirement of notice or awareness. See, e.g., Genner v. Sparks, 6 Mod. 173, 87 Eng.Rep. 928. It is stated in an English annotator's note to Semayne's Case, supra, that 'if a man being legally arrested, escapeth from the officer, and taketh shelter though in his own house, the officer may upon fresh suit break open doors in order to retake him, having first given due notice of his business and demanded admission, and been refused.' 77 Eng.Rep., at 196. The views of other commentators are ambiguous on this point. See, e.g., 2 Hawkins, Pleas of the Crown (6th ed. 1787), c. 14, § 8. Blackstone's view was that 'in case of felony actually committed, or a dangerous wounding, whereby felony is like to ensue * * * (a constable) may upon probable suspicion arrest the felon; and for that purpose is authorized (as upon a justice's warrant) to break open doors, and even to kill the felon if he cannot otherwise be taken * * *.' 4 Commentaries 292.
9
See Professor Wilgus' comment: 'Before doors are broken, there must be a necessity for so doing, and notice of the authority and purpose to make the arrest must be given and a demand and refusal of admission must be made, unless this is already understood, or the peril would be increased.' Wilgus, Arrest, Without a Warrant, 22 Mich.L.Rev. 541, 798, 802 (1924). (Emphasis supplied.) Cf. Accarino v. United States, 85 U.S.App.D.C . 394, 398—402, 179 F.2d 456, 460—464.
Compare Lord Mansfield's statement, in 1774, of the rationale for the requirement of announcement and demand for admission: 'The ground of it is this; that otherwise the consequences would be fatal: for it would leave the family within, naked and exposed to thieves and robbers. It is much better therefore, says the law, that you should wait for another opportunity, than do an act of violence, which may probably be attended with such dangerous consequences.' Lee v. Gansel, 1 Cowp. 1, 6—7, 98 Eng.Rep. 935, 938.
10
The comment of Rooke, J., in Ratcliffe v. Burton, 3 Bos. & Pul . 223, 230, 127 Eng.Rep. 123, 127 (1802), is relevant here: 'What a privilege will be allowed to sheriffs' officers if they are permitted to effect their search by violence, without making that demand which possibly will be complied with, and consequently violence be rendered unnecessary!' This view of the requirement of notice or awareness has its parallel in the historic English requirement that an arresting officer must give notice of his authority and purpose to one whom he is about to arrest. In the absence of such notice, unless the person being arrested already knew of the officer's authority and mission, he was justified in resisting by force, and might not be charged with an additional crime if injury to the officer resulted. The origin of this doctrine appears to be Mackalley's Case, 9 Co.Rep. 65b, 69a, 77 Eng.Rep. 828, 835. See also Rex v. George, (1935) 2 D.L.R. 516 (B.C.Ct.App.); Regina v. Beaudette, 118 Can.Crim.Cases 295 (Ont.Ct.App.). Compare, e.g., People v. Potter, 144 Cal.App.2d 350, 300 P.2d 889, in which noncompliance with § 844 was excused because the defendant was known to have been convicted of three previous robberies and was suspected of a fourth—though in fact, upon entering his hotel room unannounced and by means of a key obtained from the manager, the officers found the defendant in bed, with the lights off, and unarmed. The entry occurred after midnight.
11
The importance of this consideration was aptly expressed long ago by Heath, J., in Ratcliffe v. Burton, 3 Bos. & Pul. 223, 230, 127 Eng.Rep. 123, 126—127 (1802):
'The law of England, which is founded on reason, never authorises such outrageous acts as the breaking open every door and lock in a man's house without any declaration of the authority under which it is done. Such conduct must tend to create fear and dismay, and breaches of the peace by provoking resistance. This doctrine would not only be attended with great mischief to the persons against whom process is issued, but to other persons also, since it must equally hold good in cases of process upon escape, where the party has taken refuge in the house of a stranger. Shall it be said that in such case the officer may break open the outer door of a stranger's house without declaring the authority under which he acts, or making any demand of admittance? No entry from the books of pleading has been cited in support of this justification, and Semayne's case is a direct authority against it.'
12
See also McDonald v. United States, 335 U.S. 451, 460 461, 69 S.Ct. 191, 196, 93 L.Ed. 153 (concurring opinion) for Mr. Justice Jackson's comment: 'Many homeowners in this crime-beset city doubtless are armed. When a woman sees a strange man, in plain clothes, prying up her bedroom window and climbing in, her natural impulse would be to shoot.'
13
See, e.g., Kamisar, Public Safety v. Individual Liberties: Some 'Facts' and 'Theories,' 53 J.Crim.L., Criminology and Police Science 171, 188—190 (1962); Rogge, Book Review, 76 Harv.L.Rev. 1516, 1522-1523 (1963).
14
Compare Justice Traynor's recent comment:
'Nevertheless the United States Supreme Court still confronts a special new responsibility of its own. Sooner or later it must establish ground rules of unreasonableness to counter whatever local pressures there might be to spare the evidence that would spoil the exclusionary rule. Its responsibility thus to exercise a restraining influence looms as a heavy one. It is no mean task to formulate farsighted constitutional standards of what is unreasonable that lend themselves readily to nationwide application.' Traynor, Mapp v. Ohio at Large in the Fifty States, 1962 Duke L.J. 319, 328.
15
The problems raised by this case are certainly not novel in the history of law enforcement. One of the very earliest cases in this field, decided more than three centuries ago, involved facts strikingly similar to those of the instant case. The case of Waterhouse v. Saltmarsh, Hob. 263, 80 Eng.Rep. 409, arose out of the service by a sheriff and several bailiffs of execution upon a bankrupt. These officers, having entered the outer door of the house by means not described, "ran up to the chamber, where the plaintiff and his wife were in bed and the doors lockt, and knocking a little, without telling what they were, or wherefore they came, brake open the door and took him * * *." The sheriff was fined the substantial sum of 200—for what the court later described in a collateral proceeding as 'the unnecessary outrage and terror of this arrest, and for not signifying that he was sheriff, that the door might have been opened without violence * * *.' Hob., at 264, 80 Eng.Rep., at 409. Compare another early case involving similar problems, Park v. Evans, Hob. 62, 80 Eng.Rep. 211, in which the Star Chamber held unlawful an entry effected by force after the entering officers had knocked but failed to identify their authority or purpose. The Star Chamber concluded that 'the opening of the door was occasioned by them by craft, and then used to the violence, which they intended.'
16
Any doubt concerning the scope of the California test which may have survived People v. Maddox, 46 Cal.2d 301, 294 P.2d 6, must have been removed by the later case of People v. Hammond, 54 Cal.2d 846, 854—855, 9 Cal.Rptr. 233, 357 P.2d 289, 294:
'When there is reasonable cause to make an arrest, and the facts known to the arresting officer before his entry are not inconsistent with a good faith belief on his part that compliance with the formal requirements of * * * section (844) is excused, a failure to comply therewith does not invalidate the search and seizure made as an incident to the ensuing arrest.'
17
I think it is unfortunate that this Court accepts the judgment of the intermediate California appellate court on a crucial question of California law—for it is by no means certain that the Supreme Court of California, the final arbiter of questions of California law, would have condoned the willingness of the District Court of Appeal to excuse noncompliance with the California statute under the facts of this case. For the view of the California Supreme Court on the scope of the exception under § 844, see, e.g., People v. Martin, 45 Cal.2d 755, 290 P.2d 855; People v. Carswell, 51 Cal.2d 602, 335 P.2d 99 ; People v. Hammond, 54 Cal.2d 846, 9 Cal.Rptr. 233, 357 P.2d 289 .
An examination of the California decisions which have excused noncompliance with § 844 reveals the narrow scope of the exceptions heretofore recognized—confined for the most part to cases in which officers entered in response to cries of a victim apparently in imminent danger, e.g., People v. Roberts, 47 Cal.2d 374, 303 P.2d 721; or in which they first knocked at the door, or knew they had been seen at the door, and then actually heard or observed destruction of evidence of the very crime for which they had come to arrest the occupants, see, e.g., People v. Moore, 140 Cal.App.2d 870, 295 P.2d 969; People v. Steinberg, 148 Cal.App.2d 855, 307 P.2d 634; People v. Williams, 175 Cal.App.2d 774, 1 Cal.Rptr. 44; People v. Fisher, 184 Cal.App.2d 308, 7 Cal.Rptr. 461. See generally, for summary and discussion of California cases involving various grounds for noncompliance with § 844, Fricke, California Criminal Evidence (5th ed. 1960), 432—433; Comment, Two Years With the Cahan Rule, 9 Stan.L.Rev. 515 , 528—529 (1957).
| 01
|
374 U.S. 97
83 S.Ct. 1685
10 L.Ed.2d 1025
Raymond B. RANDOLPH et al.v.VIRGINIA.
No. 20.
Supreme Court of the United States
June 10, 1963
Martin A. Martin, Clarence W. New-some, Jack Greenberg, James M. Nabrit III and Charles L. Black, Jr., for petitioners.
Robert Y. Button, Atty. Gen. of Virginia, and R. D. McIlwaine III, Asst. Atty. Gen., for respondent.
On Petition for Writ of Certiorari to the Supreme Court of Appeals of Virginia.
PER CURIAM.
1
The petition for writ of certiorari is granted, the judgments are vacated and the case is remanded to the Supreme Court of Appeals of Virginia for reconsideration in light of Peterson v. City of Greenville, 373 U.S. 244, 83 S.Ct. 1119.
2
Mr. Justice HARLAN concurs in the result on the premises stated in his separate opinion in Peterson v. City of Greenville, supra, and Avent v. North Carolina, 373 U.S. 248, 83 S.Ct. 1133.
| 12
|
374 U.S. 1
83 S.Ct. 1667
10 L.Ed.2d 709
Michael SHENKER, Petitioner,v.The BALTIMORE AND OHIO RAILROAD COMPANY.
No. 414.
Argued April 17, 1963.
Decided June 10, 1963.
Charles Alan Wright, Austin, Tex., for petitioner.
Alexander H. Hadden, Cleveland, Ohio, for respondent.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
The petitioner brought an action under the Federal Employers' Liability Act, 45 U.S.C. §§ 51—60, in the Federal District Court for the Western District of Pennsylvania to recover for injuries caused by the alleged negligence of the respondent Baltimore & Ohio Railroad (B&O) and the Pittsburgh & Lake Erie Railroad (P E). At the close of the evidence, the District Court directed a verdict in favor of the P E on the ground that the evidence failed to establish that the petitioner was an employee of that company as required by § 1 of the Act (45 U.S.C. § 51). The case against the B&O, however, was submitted to the jury which returned a verdict of $40,000 for the petitioner. The District Court denied a motion for judgment n.o.v. and entered judgment as found by the jury. On appeal, the Third Circuit Court of Appeals, one judge dissenting, reversed, holding that the petitioner failed to establish negligence on the part of the B&O. 303 F.2d 596. A rehearing en banc was denied. We granted certiorari, 371 U.S. 908, 83 S.Ct. 255, 9 L.Ed.2d 169.
2
The petitioner was employed by the B&O at its Mahoningtown station in New Castle, Pennsylvania. The railroad complex at Mahoningtown consisted of four sets of tracks, two owned and operated by the B&O and two by the P E. On the B& O side, the B&O maintained a station and station facilities. Although the P E maintained a station, it kept no employees, all necessary services for the two stations being provided by B&O employees. The B&O ticket agent issued tickets in the B&O station for the P E trains. The petitioner provided janitor work for both stations and assisted the loading and unloading of mail cars for the trains of both railroads. The petitioner was paid by the B&O and was under the sole supervision of the B&O ticket agent.
3
On the date of the accident, October 15, 1956, the petitioner handled the mail for the P E train scheduled to depart Mahoningtown at 12:25 a.m. The petitioner loaded 20 to 25 bags of mail on a B&O wagon at the B&O station. He crossed the B&O and P E tracks to the P E platform and, when the P E train pulled up, brought the wagon alongside the mail car door. On this occasion, in spite of the efforts of the petitioner and the P E baggageman, one Beck, the sliding door on the P E car would not open more than 18 or 20 inches. According to the petitioner, Beck commented that he had reported the defective door to the P E which had yet to fix it and that they would have to get the mail on and off as best they could. The petitioner standing on the wagon, had no difficulty throwing the smaller bags in the restricted opening. The larger ones, however, weighing from 80 to 100 pounds, required the petitioner 'to twist around,' and 'to keep pushing and forcing them' to get them in the opening. In the process of this unusual exertion, the petitioner felt something snap in his back. He reported the injury immediately to the B&O ticket agent. Treatment of the injury eventually required the removal of a ruptured intervertebral disc and resulted in the petitioner's permanent disability. On the basis of this evidence, the jury found for the petitioner.
4
Before considering the merits of the decision below, the petitioner raises a procedural point, claiming that he was denied a rehearing en banc in the Third Circuit Court of Appeals in violation of his rights under 28 U.S.C. § 46(c). At the time the petitioner filed his motion for rehearing en banc there were eight active judges serving on the Third Circuit. Four judges voted to grant the rehearing, two voted to deny, and two abstained. The rehearing was denied. The petitioner claims that to grant a rehearing en banc, the statute requires only a majority of those present. The Third Circuit requires an absolute majority of the active members of the court. Section 46(c) provides:
5
'Cases and controversies shall be heard and determined by a court or division of not more than three judges, unless a hearing or rehearing before the court in banc is ordered by a majority of the circuit judges of the circuit who are in active service. A court in banc shall consist of all active circuit judges of the circuit.'
6
The Court had occasion to consider this section at length in Western Pac. R. Corp. v. Western Pac. R. Co., 345 U.S. 247, 73 S.Ct. 656, 97 L.Ed. 986. It there said:
7
'In our view, § 46(c) is not addressed to litigants. It is addressed to the Court of Appeals. It is a grant of power. It vests in the court the power to order hearings en banc. It goes no further. It neither forbids nor requires each active member of a Court of Appeals to entertain each petition for a hearing or rehearing en banc. The court is left free to devise its own administrative machinery to provide the means whereby a majority may order such a hearing.' 345 U.S., at 250, 73 S.Ct., at 658.
8
The Court went on to say that the rights of the litigant go no further than the right to know the administrative machinery that will be followed and the right to suggest that the en banc procedure be set in motion in his case. The practice of the Third Circuit has been fully revealed by Judge Maris in Hearing And Rehearing Cases In Banc, 14 F.R.D. 91, which was referred to with approval by this Court in United States v. American-Foreign S.S. Corp., 363 U.S. 685, 688, n. 5, 80 S.Ct. 1336, 1338, 4 L.Ed.2d 1491. Although every petition for rehearing is submitted to every member of the court, a judge is not required to enter a formal vote on the petition. Such a procedure is clearly within the scope of the court's discretion as we spoke of it in Western Pacific. For this Court to hold otherwise would involve it unnecessarily in the internal administration of the Courts of Appeals.
9
Turning to the merits, there can be no question that the petitioner is an employee of the B&O as required by § 1 of the F.E.L.A. Although the B&O suggests that the petitioner may have been the employee of the P E within the meaning of the common law loaned-servant doctrine, Standard Oil Co. v. Anderson, 212 U.S. 215, 29 S.Ct. 252, 53 L.Ed. 480; Linstead v. Chesapeake & Ohio R. Co., 276 U.S. 28, 32—34, 48 S.Ct. 241, 242—243, 72 L.Ed. 453, there is no evidence in the record to support such a conclusion. In describing the loaned-servant doctrine, the Court in Anderson stated that when the nominal employer furnishes a third party 'with men to do the work, and places them under his exclusive control in the performance of it, (then) those men become pro hac vice the servants of him to whom they are furnished.' 212 U.S. at 221, 29 S.Ct. at 254. The Court concluded that under the common law loaned-servant doctrine immediate control and supervision is critical in determining for whom the servants are performing services. In the present case, the undisputed facts show that the petitioner was at all times paid by the B&O and under the sole supervision of B&O employees.1 The intimations of the B&O that the petitioner might have been given directions by the P E baggageman is at most an example of the minimum cooperation necessary to carry out a coordinated undertaking, and, as noted in Anderson, cannot amount to control or supervision. 212 U.S., at 226, 29 S.Ct., at 256. The whole tenor of the services the B&O provides for the P E speaks of an agreement by the B&O to manage and operate the P E station at Mahoningtown. On such evidence, the petitioner is clearly an employee of the B&O even under the common law loaned-servant doctrine, and we therefore need not consider the extent to which that doctrine applies to cases under the F.E.L.A. See Linstead v. Chesapeake & Ohio R. Co., supra; compare Sinkler v. Missouri Pac. R. Co., 356 U.S. 326, 329—330, 78 S.Ct. 758, 761—762, 2 L.Ed.2d 799.
10
The only remaining issue is the negligence, if any, of the respondent B&O. The trial judge instructed the jury that
11
'* * * a railroad is under a duty to exercise ordinary prudence, caution and care to inspect and to furnish its employees with cars on which they work equipped with reasonably safe doors, even though the cars are owned by another railroad. A failure of the B&O Railroad to do so is negligence, providing that the railroad can foresee that one of its employees may be injured in performing his work in connection with that car and its equipment which are not reasonably safe.'
12
No exception was taken to this charge. In his opinion denying the B&O's motion for judgment n.o.v., the trial judge relied on a series of court of appeals decisions standing for the more broad proposition that a railroad has the nondelegable duty to provide its employees with a safe place to work even when they are required to go onto the premises of a third party over which the railroad has no control. See Kooker v. Pittsburgh & Lake Erie R. Co., 6 Cir., 258 F.2d 876; Chicago Great Western R. Co. v. Casura, 8 Cir., 234 F.2d 441; Beattie v. Elgin, J. & E.R. Co., 7 Cir., 217 F.2d 863. These decisions are in accord with the opinions of this Court in Bailey v. Central Vermont R. Co., 319 U.S. 350, 63 S.Ct. 1062, 87 L.Ed. 1444; Ellis v. Union Pac. R. Co., 329 U.S. 649, 67 S.Ct. 598, 91 L.Ed. 572; Harris v. Pennsylvania R. Co., 361 U.S. 15, 80 S.Ct. 22, 4 L.Ed.2d 1, reversing 168 Ohio St. 582, 156 N.E.2d 822. The present case has been argued to us on the basis of these same decisions and the safe-place-to-work doctrine. The respondent admits the general statements of the doctrine in these cases. It bases its defense solely on the proposition that because the P E train had just pulled into the station, the B&O did not have sufficient opportunity to obtain actual or constructice notice of the defective mail car door. The respondent relies on two lower court cases holding that where the defect in the premises of the third party arose within minutes or hours of the accident, there was insufficient time as a matter of law for the railroad to be held to have notice. Kaminski v. Chicago River & Indiana R. Co., 7 Cir., 200 F.2d 1; Wetherbee v. Elgin, J. & E.R. Co., 7 Cir., 191 F.2d 302, subsequent appeal reported in 204 F.2d 755, cert. denied, 346 U.S. 867, 74 S.Ct. 104, 98 L.Ed. 378.
13
Whatever the validity of these last two cases, they do not have relevance here. We hold that the B&O had a duty to inspect P E cars before permitting its employees to work with them. The standard of care applicable to the use of cars belonging to a foreign railroad was settled long before the accident in this case. In Baltimore & Potomac R. Co. v. Mackey, 157 U.S. 72, 15 S.Ct. 491, 39 L.Ed. 624, an employee of the Baltimore & Potomac was killed when a defective brake did not hold on a freight car hauled by the Baltimore & Potomac, but belonging to another railroad. Relying on the language of an earlier New York decision, Gottlieb v. New York, L.E. & W.R. Co., 100 N.Y. 462, 467, 3 N.E. 344, 345, the Court concluded that a railroad
14
'* * * is bound to inspect foreign cars just as it would inspect its own cars. It owes the duty of inspection as master * * *. When cars come to it which have defects visible or discoverable by ordinary inspection, it must either remedy such defect or refuse to take such cars,—so much, at least, is due from it to its employe s.' 157 U.S., at p. 90, 15 S.Ct., at p. 497.
15
The Court did not have to look far for the 'second reason and public policy' behind this principle. Relying on the language of the lower court, the Court said:
16
'It would be most unreasonable and cruel to declare, that, while the faithful workman may obtain compensation from a company for defective arrangement of its own cars, he would be without redress against the same company if the damaged car that occasioned the injury happened to belong to another company.' 157 U.S., at p. 89, 15 S.Ct., at p. 496.
17
This decision was reaffirmed and extended a short time later in Texas & Pac. R. Co. v. Archibald, 170 U.S. 665, 18 S.Ct. 777, 42 L.Ed. 1188. In that case, the Texas & Pacific accepted a car of the Cotton Belt Railway for loading at a cottonseed oil mill on a spur off the Texas & Pacific track. In the process of switching, an employee of the Texas & Pacific was seriously injured due to a defective coupling on the foreign car. The Texas & Pacific attempted to distinguish the Baltimore & Potomac case on the ground that the duty to inspect did not apply when a railroad accepted a foreign car only for loading rather than for hauling over its line in one of its trains. The Court dismissed the argument summarily:
18
'The argument wants foundation in reason, and is unsupported by any authority,—in reason, because, as the duty of the company to use reasonable diligence to furnish safe appliances is ever present, and applies to its entire business, it is beyond reason to attempt by a purely arbitrary distinction to take a particular part of the business of the company out of the operation of the general rule, and thereby to exempt it, as to the business so separated, from any obligation to observe reasonable precautions to furnish appliances which are in good condition.' 170 U.S., at p. 670, 18 S.Ct., at p. 779.2
19
See generally, Annotation, 41 L.R.A. 101. The rules adopted in these two cases are unavoidably applicable to the present case. The B&O required the petitioner to work with cars belonging to the P E, taking no precautions whatsoever to protect him from possible defects in these cars, defects for which it would be liable should they appear in its own cars. As Texas & Pacific makes abundantly clear, there is no de minimis rule called into play on account of the brevity of the sojourn of the P E train in Mahoningtown station, since the length of the sojourn is irrelevant to the duty owed to the employee working with the car. Nor is it an answer to claim that the B&O lacked control or supervision over the P E car. Such arguments have never supported an exception to the employer's duty to provide a safe place to work, Chicago Great Western R. Co. v. Casura, supra, p. 447 of 235 F.2d; Beattie v. Elgin, J. & E.R. Co., supra, p. 865 of 217 F.2d; Terminal R. Ass'n of St. Louis v. Fitzjohn, 8 Cir., 165 F.2d 473, 476—477, 1 A.L.R.2d 290, and have no greater relevance here with respect to the duty to provide reasonably safe cars, see Annotation, 41 L.R.A. 101. The B&O may adequately protect itself by refusing to permit its employees to service the car. Since the instructions to the jury adequately reflect the holdings in these cases and since the B&O's failure to inspect is uncontested, the jury verdict should have been affirmed.
20
Although recovery in this case is supported by the common law, it is also required by any reasonable construction of the Federal Employers' Liability Act itself. As we stated in Sinkler v. Missouri Pac. R. Co., 356 U.S. 326, 330, 78 S.Ct. 758, 762, 2 L.Ed.2d 799: 'it was the conception of this legislation that the railroad was a unitary enterprise, its economic resources obligated to bear the burden of all injuries befalling those engaged in the enterprise arising out of the fault of any other member engaged in the common endeavor.' If recovery were denied in this case, the railroads, by the simple expedient of doing each other's work, could tie their employees up in legal technicalities over the proper railroad to sue for injuries and perhaps remove from coverage of the Act a significant area of railroad activity. It would subject the employee once more to the stricter negligence standards of the common law and such debilitating doctrines as assumption of risk. Cf. Texas & Pac. R. Co. v. Archibald, 170 U.S. 665, 673, 18 S.Ct. 777, 42 L.Ed. 1188.
21
In our opinion the case was submitted to the jury under proper instructions, and there was a reasonable basis in the evidence for the verdict which the jury returned.
22
Reversed.
23
Mr. Justice GOLDBERG, with whom Mr. Justice HARLAN and Mr. Justice STEWART join, dissenting.
24
With all deference, I must respectfully dissent. We are not here dealing with a situation in which a lower court has so disregarded applicable law as to require correction here. This is simply a case in which the evidence is insufficient to sustain liability of the respondent B&O and in which a perhaps more substantial claim against the P E was abandoned by the petitioner below. Any hiatus in protection of the petitioner exists not because of inadequacies in the law, but solely because of inadequacies in the evidence.
25
Normally, in a case such as this in which the defendant's own negligence did not create the hazardous condition, actual or constructive notice to the defendant of the injury-producing defect is a prerequisite to negligence and, therefore, to liability. See, e.g., Sano v. Pennsylvania R. Co., 3 Cir., 282 F.2d 935, 936, 938; Dobson v. Grand Trunk Western R. Co., 7 Cir., 248 F.2d 545, 548; Atlantic Coast Line R. Co. v. Collins, 4 Cir., 235 F.2d 805, 808, cert. denied 352 U.S. 942, 77 S.Ct. 265, 1 L.Ed.2d 238; Kaminski v. Chicago River & Indiana R. Co., 7 Cir., 200 F.2d 1, 4. See also Ringhiser v. Chesapeake & O.R. Co., 354 U.S. 901, 77 S.Ct. 1093, 1 L.Ed.2d 1268; Wetherbee v. Elgin, J. & E.R Co., 7 Cir., 191 F.2d 302, subsequent appeal reported in 204 F.2d 755, cert. denied, 346 U.S. 867, 74 S.Ct. 104, 98 L.Ed. 378. Thus, given the failure of the petitioner to introduce evidence tending to show that the respondent B&O knew, or in the exercise of reasonable care should have known, of the defective door, the judgment entered below in favor of the B&O should be sustained.1
26
The Court seeks to avoid the application of these ordinarily controlling principles by invoking several cases, decided prior to enactment of the F.E.L.A., which, it holds, require that, in order to discharge its duty 'to use reasonable care in furnishing (the petitioner) with a safe place to work,' Bailey v. Central Vermont R. Co., 319 U.S. 350, 352, 63 S.Ct. 1062, 1064, 87 L.Ed. 1444,2 the B&O must inspect the P E cars before B&O employees are allowed or directed to work on them. Even accepting, arguendo, the general applicability here of the principle imposing on the B&O the duty to inspect the cars which it services for the P E, the result reached by the Court does not follow. Such a duty may exist, to be sure, but the obligation can be no more than to conduct reasonable, nonnegligent inspections, and the liability which would accrue from breach of such a duty would be responsibility for damages occurring as a result of the negligent performance or the nonperformance of that duty. In a meaningful sense, then, imposition of a duty to inspect is no more than a specific application of the concept of constructive knowledge, since it is implicit in the principle that one is chargeable with knowledge of that which in the exercise of reasonable care he should have known. Here, that would mean that in the exercise of reasonable care the B&O should have inspected the P&LE cars and is chargeable with knowledge of that which a reasonable inspection would have shown.
27
The Court, however, says merely that the B&O had a duty to inspect and that, having failed to inspect, it is liable to the petitioner for the defect which apparently caused his injury. I find this reasoning unconvincing.
28
While the Court declares that it is undisputed that the B&O did not inspect, there is simply no evidence in the record with regard to inspection. Moreover, even if an inference of failure to inspect were supportable, there is no basis for assuming, as the Court does and must do to sustain its result, that a reasonable, nonnegligent inspection procedure would, in fact, have disclosed the defect which is the basis of the petitioner's claim. Even when there does exist a duty of inspection, the mere existence of a defect does not itself create liability; it must also be shown that reasonable, nonnegligent inspection procedures would have disclosed the defect.3 Evidence of this liability-producing factor was not introduced by the petitioner. The record is devoid of evidence as to the length of time the defect existed prior to the petitioner's injury,4 and as to whether, even under an extremely careful and nonnegligent inspection procedure, the defect would have been discovered prior to the time of petitioner's injury.
29
Under the rationale and result of this case, a railroad would be liable for a defect which first appeared immediately prior to the injury for which recovery is sought and which even the most scrupulous kind of inspection procedure could neither have avoided nor detected. What the Court appears to have done is to create not simply a duty of inspection, but an absolute duty of discovery of all defects; in short, it has made the B&O the insurer of the condition of all premises and equipment, whether its own or others, upon which its employees may work. This is the wholly salutary principle of compensation for industrial injury incorporated by workmen's compensation statutes, but it is not the one created by the F.E.L.A., which premises liability upon negligence of the employing railroad. It is my view that, as a matter of policy, employees such as the petitioner, who are injured in the course of their employment, should be entitled to prompt and adequate compensation regardless of the employer's negligence and free from traditional common-law rules limiting recovery. But Congress has elected a different test of liability which, until changed, courts are obligated to apply.
1
The testimony of the B&O ticket agent on duty at the time of the petitioner's injury stands undisputed in the record:
'Q. (By the Court) Did the P E have any boss there that night?
'A. No, sir, the P E didn't have any employees whatsoever connected with that operation there.
'Q. Under whose supervision was Mr. Shenker?
'A. He was under the ticket agent, Mr. Boyd.
'Q. On that turn when he got hurt?
'A. On that turn he was under my supervision.
'Q. During the four months you say he worked there, did any P E employee give directions or orders to the plaintiff?
'A. No, sir.
'Q. From whom did he receive direction and orders, instructions?
'A. From me or Mr. Boyd would let me know what he wanted done and I would tell Mr. Shenker.
'Q. And you and Mr. Boyd were exclusively Baltimore & Ohio Railroad employees?
'A. Yes, sir.'
2
The Court in Texas & Pacific went on to hold that the railroad will not be held to its duty to inspect where the employee himself becomes aware of the defect yet continues to work with the car with knowledge of its defect. This exception to the rule was based on the belief that the employee assumes the risk of handling appliances which are known to be defective. 170 U.S., at pp. 672—673, 18 S.Ct., at pp. 779—780. This exception, of course, is no longer relevant under the F.E.L.A., since § 4 of the Act expressly eliminates assumption of risk as a defense to negligence on the part of the employer. In its place, the railroad may raise contributory negligence on the part of the employee in mitigation of damages, a defense that was raised in this case and on which the jury was properly charged.
1
The petitioner does not here argue that notice of the defect to the P E was also sufficient notice to respondent B&O.
2
Although language in its opinion suggests the contrary, see pp. 7, 10, ante, I do not understand the Court today to be directly declaring an absolute duty to provide a safe place to work without regard to negligence, since the very cases cited by the Court indicate that the duty is to exercise reasonable care with respect thereto. Instead, the Court ignores the statutory concept of negligence in setting out the duty of inspection it imposes, a result which, for the reasons stated infra, is erroneous and violates the clear language of the governing statute.
3
This, in fact, is the apparent rule of the very cases relied upon by the Court to subject the B&O to liability here. In Baltimore & Potomac R. Co. v. Mackey, 157 U.S. 72, 15 S.Ct. 491, 39 L.Ed. 624, cited by the majority at p. 8, ante, the Court based liability on the operative 'principle that a railroad company is under a legal duty not to expose its employe § to dangers arising from such defects in foreign cars as may be discovered by reasonable inspection before such cars are admitted into its train.' 157 U.S., at 91, 15 S.Ct., at 497 (emphasis supplied). The second case upon which the majority bases its result here, see pp. 8—9, ante, simply applies this same principle to a somewhat different set of facts, again declaring liability for injury-producing defects 'discoverable by proper inspection.' Texas & Pac. R. Co. v. Archibald, 170 U.S. 665, 672, 18 S.Ct. 777, 779, 42 L.Ed. 1188 (emphasis supplied). The nature and timing of the required inspection—but probably not, as the Court here declares, the duty of inspection itself—presumably depend, as a function of its reasonableness, on a number of factors, including the duration of the time the car is available to the defendant for inspection and the manner in which it is received. In both of the cited cases, the 'foreign' car was in the possession and on the tracks of the named defendant upon which liability was imposed.
4
The statement attributed to the P E baggageman by the petitioner that the defective door had been reported to the P E does not, of course, shed any light on the length of time the defect had continued to exist. The report may well have been made only shortly before the petitioner was injured.
| 78
|
374 U.S. 469
83 S.Ct. 1819
10 L.Ed.2d 1013
Jose Maria GASTELUM-QUINONES, Petitioner,v.Robert F. KENNEDY, Attorney General of the United States (two cases).
Nos. 39, 293.
Argued March 19, 1963.
Decided June 17, 1963.
David Rein, Washington, D.C., for petitioner.
Bruce J. Terris, Washington, D.C., for respondent.
Mr. Justice GOLDBERG delivered the opinion of the Court.
1
This case, stripped of its procedural complexities, raises the question whether an alien long resident in this country is deportable because, for a period during 1949 and 1950, he paid dues to and attended several meetings of a club of the Communist Party in Los Angeles. The Immigration and Naturalization Service sought and obtained an order for petitioner's deportation on the ground that these facts established petitioner's membership in the Communist Party of the United States within the meaning of § 241(a)(6)(C) of the Immigration and Nationality Act of 1952, 66 Stat. 163, 204—205, 8 U.S.C. § 1251(a)(6)(C).1 Whether membership was so established turns on the application of two decisions of this Court which construed the immediate predecessor of § 241(a) (6)(c,), § 22 of the Internal Security Act of 1950, 64 Stat. 987, 1006, 1008. In Galvan v. Press, 347 U.S. 522, 528, 74 S.Ct. 737, 741, 98 L.Ed. 911, it was held that deportability on the ground of Communist Party membership turns on whether the alien was 'aware that he was joining an organization known as the Communist Party which operates as a distinct and active political organization * * *,' and in Rowoldt v. Perfetto, 355 U.S. 115, 120, 78 S.Ct. 180, 183, 2 L.Ed.2d 140, it was held, in elaboration of Galvan, that the alien must have had a 'meaningful association' with the Communist Party in order to be deportable. The evidence in the record, to which the standards set sorth in these decisions must be applied, was all elicited at hearings before the Service's special inquiry officer in 1956. This evidence consists solely of the testimony of two government witnesses, petitioner having chosen to introduce no evidence.
2
The special inquiry officer entered a deportation order against petitioner on February 28, 1957. The Board of Immigration Appeals dismissed petitioner's appeal on November 14, 1957, on the ground that the record established his voluntary membership in the Communist Party. A few weeks later, this Court decided Rowoldt v. Perfetto, supra, and petitioner asked the Board to reconsider its decision in light of the opinion in that case. The Board denied the application, pointing out that the record as it stood still supported the deportation order. It did, however, order a reopening of the proceedings before the special inquiry officer so that petitioner might have a chance to offer rebuttal testimony and thereby bring himself, possibly, within the framework of the Rowoldt decision.
3
At the reopened hearing, however, petitioner's counsel took the position that on the record as it stood the Government had failed to establish Communist Party membership in the sense contemplated by the Rowoldt decision, and therefore chose not to offer further evidence. The Government also offered no additional evidence. The special inquiry officer reaffirmed his previous decision and the Board of Immigration Appeals on May 18, 1959, dismissed petitioner's appeal. Petitioner thereupon filed an action in Federal District Court for review of the deportation order. That court granted the Government's motion for summary judgment and dismissed the action. The United States Court of Appeals for the District of Columbia Circuit Affirmed the dismissal, Gastelum-Quinones v. Rogers, 109 U.S.App.D.C. 267, 286 F.2d 824, and this Court denied a petition for certiorari, 365 U.S. 871, 81 S.Ct. 902, 5 L.Ed.2d 861.
4
Petitioner read the Court of Appeals' opinion as suggesting that § 241(a)(6) (C) would not have applied to him if he had introduced evidence that he had not personally advocated the forcible overthrow of the Government.2 He therefore moved before the Board of Immigration Appeals that the deportation hearing be reopened to permit him to introduce evidence that he did not personally advocate the violent overthrow of the Government. The Board of Immigration Appeals heard oral argument on the motion and, on August 1, 1961, denied it.
5
Petitioner then brought the present action in the District Court, praying that the Board be ordered to reopen the deportation hearing and that the Attorney General and his agents be enjoined from enforcing the outstanding deportation order. A preliminary injunction to the latter effect was also requested. The court denied the motion for preliminary injunction on August 14, 1961, and the Court of Appeals summarily affirmed this denial on September 13. Petitioner filed a petition for certiorari in this Court to review the denial of preliminary injunctive relief, and THE CHIEF JUSTICE ordered deportation stayed until the petition should be disposed of. Meanwhile, summary judgment was granted the Government on the merits of petitioner's complaint, which was thereupon dismissed, a disposition which was summarily affirmed by the Court of Appeals on February 23, 1962. Petitioner filed an additional petition for certiorari to review this judgment. We granted both petitions. 371 U.S. 860, 83 S.Ct. 115, 120, 9 L.Ed.2d 98. No. 39 involves the preliminary injunction, and No. 293 relates to the ultimate dismissal of petitioner's complaint on the merits.
6
In determining whether, on the record before us, the Government has fulfilled its burden of proving that petitioner was a 'member' of the Communist Party of the United States within the meaning of § 241(a)(6)(C), we must recognize at the outset what the history of the times amply demonstrates,3 that some Americans have joined the Communist Party without understanding its nature as a distinct political entity. The Rowoldt decision, as well as other decisions of this Court, reflects that there is a great practical and legal difference between those who firmly attach themselves to the Communist Party being aware of all of the aims and purposes attributed to it, and those who temporarily join the Party, knowing nothing of its international relationships and believing it to be a group solely trying to remedy unsatisfactory social or economic conditions, carry out trade-union objectives, eliminate racial discrimination, combat unemployment, or alleviate distress and poverty.4 Although the Court specifically recognized in Galvan, supra, 347 U.S. at 528, 74 S.Ct. at 741 that 'support, or even demonstrated knowledge, of the Communist Party's advocacy of violence was not intended to be a prerequisite to deportation,' it did condition deportability on the alien's awareness of the 'distinct and active political' nature of the Communist Party, ibid. This, together with the requirement of 'meaningful association' enunciated in Rowoldt, supra, 355 U.S. at 120, 78 S.Ct. at 183 led the Court to declare later that in Galvan and Rowoldt it had 'had no difficulty in interpreting 'membership' * * * as meaning more than the mere voluntary listing of a person's name on Party rolls.' Scales v. United States, 367 U.S. 203, 222, 81 S.Ct. 1469, 1483, 6 L.Ed.2d 782.
7
The operation in practice of this wise distinction is illustrated by Rowoldt, to which we think the present case is analogous on its facts. In Rowoldt, the sole evidence in the record was Rowoldt's statement to an inspector of the Immigration and Naturalization Service, in the course of which he admitted voluntary membership but said nothing which indicated that he had been aware while a member that the Communist Party was a 'distinct and active political organization.' Mr. Justice Frankfurter, speaking for the Court, concluded that '(f)rom his own testimony in 1947, which is all there is, the dominating impulse to his 'affiliation' with the Communist Party may well have been wholly devoid of any 'political' implications.' 355 U.S., at 120, 78 S.Ct., at 183. The Court therefore decided that the record was too insubstantial to support the order of deportation. The same is true here. The testimony of the two government witnesses establishes only that between either late 1948 or early 1949 and the end of 1950 or early 1951 petitioner was a dues-paying member of a club of the Communist Party in Los Angeles, and that he attended about 15 meetings of his Party club, one executive meeting of the group, and one area Party convention.
8
One witness, Scarletto, testified to having joined the Communist Party in Los Angeles in 1947 'under the supervision of the F.B.I.' At a date which he did not recall, but which he thought was in late 1948 or early 1949, Scarletto was assigned to the El Sereno Club, which 'was one of the large divisions (of the Communist Party) which was split up later.' There were 'approximately 32 members in the El Sereno Club at that time,' and Scarletto was the press director of the club. Scarletto was only in the El Sereno Club for 'a few months' when it 'was split up into smaller units for security reasons.' During these few months, Scarletto testified, he was introduced to petitioner at an El Sereno Club meeting and saw him there one other time. Since attendance at club meetings was restricted to Communist Party members, Scarletto inferred that petitioner was a member of the Party.
9
Scarletto was next assigned, some time in early 1949, to the Mexican Concentration Club, which, he testified, was also a unit of the Communist Party of the United States. Petitioner, he said, was put into the same new group. Scarletto shortly became organization secretary of this group, a job which, among other things, gave him the duty of collecting dues, and he testified that he collected dues from petitioner. Scarletto left the Concentration Club in early 1951, when he was transferred by the Party 'to the underground.'
10
Concentration Club meetings were held weekly. Petitioner, Scarletto testified, 'just went once in awhile, but he was a regular member.' Over the approximately two-year period of Scarletto's membership in the Concentration Club, during which he attended 'most' of its meetings, he testified that he saw petitioner at 'about 15' meetings. All but 'a couple' of these, he said, were restricted to Communist Party members. Although meetings were held in members' homes, Scarletto did not recall any at petitioner's home and said that he himself had never been in petitioner's home. Scarletto did not remember whether petitioner ever held 'an official position' in either the El Sereno Club or the Mexican Concentration Club. Finally, Scarletto, who attended Communist Party conventions in the Los Angeles area with some regularity, recalled seeing petitioner at one such convention. He said he himself attended these conventions in an official capacity, but did not know in what capacity petitioner attended, except that membership in the Party was a prerequisite to attendance.
11
The other witness, one Elorriaga, testified that he, too, joined the Communist Party in Los Angeles in 1947. He, too, was a member of the El Sereno Club, but did not meet petitioner until he was assigned to a smaller unit 'known as the Forty-Fifth Concentration,' which apparently was the same entity as the 'Mexican Concentration Club' discussed by Scarletto. Elorriaga did not recall petitioner as being a member of the El Sereno Club. Elorriaga's testimony as to the frequency of petitioner's attendance at Concentration Club meetings was contradictory. After having testified on direct examination that he saw petitioner at three or four meetings a month, Elorriaga radically revised his estimate the next day on redirect examination to say that he saw petitioner at 'about two or three meetings' in total, adding that 'I was present at one meeting in 1951 and another in 1949 with * * * (petitioner).'5 The over-all lack of precision of Elorriaga's answers to questions concerning petitioner is also suggested by a comparison of his assertion that petitioner must have been an official of the club 'because he attended a few (of its) executive meetings,' with his immediately following admission that he himself remembered being present at only one executive meeting with petitioner.
12
The evidence contained in the record is thus extremely insubstantial in demonstrating the 'meaningful' character of petitioner's association with the Party, either directly, by showing that he was, during the time of his membership, sensible to the Party's nature as a political organization, or indirectly, by showing that he engaged in Party activities to a degree substantially supporting an inference of his awareness of the Party's political aspect.6 In one sense, indeed, this record is even less substantial in support of the deportation order than was the record in Rowoldt, because, although Rowoldt stated that he joined thinking the Party's aim was 'to get something to eat for the people,' 355 U.S., at 117, 78 S.Ct., at 182 it was also true that he had worked as a salesman in a bookstore which was 'an official outlet for communist literature,' id., at 118, 78 S.Ct., at 182 and that he showed some awareness of Communist philosophy and tactics in response to questioning by the immigration inspector. Bearing in mind that the ultimate burden in deportation cases such as this is on the Government, it is apparent that here, as in Rowoldt, there is insufficient evidence to support the deportation order.7
13
As against the slimness of the evidence that it introduced, the Government seeks the benefit of an inference, based upon petitioner's failure to produce or elicit evidence in response to the Government's proof that he paid dues to the Party and attended some meetings, that his association with the Party was 'more than the mere voluntary listing of * * * (his) name on Party rolls.' Scales, supra, 367 U.S. at 222, 81 S.Ct. at 1482. It is a sufficient answer to the Government's argument to point out that, as recognized in Galvan, supra, 347 U.S. at 530, 74 S.Ct. at 742, and Rowoldt, supra, 355 U.S. at 120, 78 S.Ct. at 183, deportation is a drastic sanction, one which can destroy lives and disrupt families, and that a holding of deportability must therefore be premised upon evidence of 'meaningful association' more directly probative than a mere inference based upon the alien's silence.8 Moreover, the fact is that the Government might well have asked its two witnesses about petitioner's knowledge of the Party as a political entity and about the qualitative nature of petitioner's activities in the Party. If it were the fact that petitioner was more aware of the Party's nature than this record shows, the Government's witnesses could likely have given testimony, either about petitioner's knowledge or about his Party activities, which would have tended to prove that awareness. With the facts concerning the nature of petitioner's association perhaps near at hand, and in light of both the possibility that those facts would not be consistent with a finding of 'meaningful association' and the harshness of the deportation sanction, we cannot sustain petitioner's deportation upon a bare inference which the Government would have us derived from petitioner's failure to introduce evidence in response to the Government's proof of his dues-paying membership and sometime attendance at Party meetings.
14
We are hence confronted with a case in which the Government did not sustain its burden of establishing that petitioner was a meaningful member of the Party as contemplated by § 241(a)(6)(C). To paraphrase the holding of Rowoldt, supra, 355 U.S. at 120, 78 S.Ct. at 183: from the testimony of the two government witnesses, which is all there is, the dominating impulse to petitioner's affiliation with the Communist Party may well have been wholly devoid of any 'political' implications. We hold that, on the record before us, the deportation order against petitioner is not supported by substantial evidence, Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456, and therefore cannot stand.9
15
Judgment reversed.
16
Mr. Justice WHITE, whom Mr. Justice CLARK, Mr. Justice HARLAN and Mr. Justice STEWART join, dissenting.
17
Petitioner is charged with being an alien who after entry had become a member of the Communist Party, and thus subject to deportation under § 241(a)(6)(C) of the Immigration and Nationality Act of 1952. Hearings were held from April through July 1956, at which the United States introduced testimony of two witnesses as to petitioner's affiliation with Communist Party units in Los Angeles from 1949 to 1951, but petitioner refused to answer any question concerning his membership in the Communist Party. The special inquiry officer found petitioner deportable under § 241(a)(6)(C) and the Board of Immigration Appeals dismissed the petitioner's appeal on November 14, 1957, holding that the evidence established a prima facie case of membership which petitioner made no attempt to rebut. On January 13, 1958, after this Court's decision in Rowoldt v. Perfetto, 355 U.S. 115, 78 S.Ct. 180, 2 L.Ed.2d 140, the Board of Immigration Appeals reconsidered petitioner's case in light of Rowoldt. Noting that, unlike the petitioner in Rowoldt, petitioner here had offered no evidence which would upset the normal inference of political awareness flowing from his two-year association with the Communist Party at a time when the purposes and activities of the Party were a matter of public record, the Board granted petitioner's request to reopen the proceedings in order that he might present testimony which would bring him within Rowoldt. At the reopened hearings, however, petitioner offered no evidence but merely introduced a statement asserting that the existing record did not establish meaningful membership and suggesting that the Government present additional evidence. The special inquiry officer, after re-examining the record, adhered to his original conclusion that the evidence showed voluntary, meaningful membership in the Communist Party. On appeal to the Board of Immigration Appeals, that body, after examining the record again, reaffirmed its decision that the testimony established meaningful membership within the Rowoldt case. Petitioner filed a petition for declaratory and injunctive relief in the District Court to review the deportation order and, after still another examination of the order and the supporting record, the court granted the Board's motion for summary judgment. The Court of Appeals held that 'the findings of the Board that (petitioner's) Party membership was meaningful is established by the record,' 109 U.S.App.D.C. 267, 271, 286 F.2d 824, 828, and affirmed. In a petition for certiorari to this Court, petitioner argued that the evidence was insufficient to support the deportation order, but certiorari was denied, 365 U.S. 871, 81 S.Ct. 902, 5 L.Ed.2d 861.
18
Petitioner thereupon commenced the proceedings which bring the case before us today. He filed a motion to reopen the proceedings before the Board of Immigration Appeals on the ground that he should be permitted to testify that he never personally advocated the overthrow of the Government by force and violence. While not disputing that an inquiry into whether an alien personally advocated violent overthrow is immaterial in deportation proceedings, Galvan v. Press, 347 U.S. 522, 74 S.Ct. 737, 98 L.Ed. 911, petitioner nonetheless insisted upon introducing the testimony because, as he read the opinion of the Court of Appeals, 109 U.S.App.D.C. 267, 286 F.2d 824, proof that an alien did not personally espouse the cause of violent overthrow of the Government would save him from deportation under § 241(a)(6)(C). The Board of Immigration Appeals declined to reopen the proceedings again, because in its view the Court of Appeals did not announce the rule on which petitioner relied and because Galvan v. Press and Rowoldt v. Perfetto so clearly held that proof of such a personal commitment to the tenet of violent overthrow was not required for deportation proceedings. After reviewing the record for the third time, the Board concluded that 'there is uncontradicted testimony to show that a voluntary meaningful membership existed.' Petitioner filed his second action for judicial review, contending that the refusal to reopen the hearings so that he could submit his testimony was 'erroneous, unconstitutional and illegal.' The District Court, finding no abuse of discretion in the Board's refusal to reopen the proceedings, declined to disturb the deportation order. The Court of Appeals affirmed, the case was brought here and the Court now reverses. I respectfully dissent.
19
First. The issue tendered to the District Court was whether the Board of Immigration Appeals should have reopened the record to allow petitioner to present evidence of the kind stated in the affidavit attached to the complaint. Both the District Court and the Court of Appeals upheld the Board's refusal to reopen the proceedings. The Court here does not disagree, nor does it suggest that the evidence which petitioner sought to add to the record was in any way material to the question of deportability under the statute. Instead, it decides that the record does not show meaningful or voluntary membership, thus resurrecting an issue supposedly settled in previous proceedings in this case, an issue which the courts below time after time decided contrary to the view now taken by this Court and an issue which the Court itself previously declined to review by certiorari. A wise use of the Court's powers would confine decision here to the issue presented to the District Court, rather than afford repeated review of previously decided matters and so call into question the integrity of the administrative and judicial process.
20
Second. Shaughnessy v. Pedreiro, 349 U.S. 48, 75 S.Ct. 591, 99 L.Ed. 868, held that an alien could, by bringing an action for declaratory judgment and injunction, secure judicial review of a 'final' order of deportation under § 10 of the Administrative Procedure Act. This is such an action, as the complaint expressly states, and affirmance of the order of deportation is required in this case unless the administrative findings are not supported by substantial evidence. Although the order must 'be set aside when the record before a Court * * * clearly precludes the Board's decision from being justified by a fair estimate of the worth of the testimony of witnesses or its informed judgment on matters within its special competence or both,' review under § 10 does not 'mean that even as to matters not requiring expertise a court may displace the Board's choice between two fairly conflicting views, even though the court would justifiably have made a different choice had the matter been before it de novo.' Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 488, 490, 71 S.Ct. 456, 465, 95 L.Ed. 456. 'It is * * * immaterial that the facts permit the drawing of diverse inferences. The (agency) alone is charged with the duty of initially selecting the inference which seems most reasonable and (its) choice, if otherwise sustainable, may not be disturbed by a reviewing court.' Cardillo v. Liberty Mutual Ins. Co., 330 U.S. 469, 478, 67 S.Ct. 801, 807, 91 L.Ed. 1028.
21
If Galvan v. Press and Rowoldt v. Perfetto are not to be overruled, or substantially modified, neither of which petitioner has requested here, and if the substantial evidence rule is not to be abandoned, there is ample basis on this record to sustain the finding of voluntary, meaningful membership. Petitioner was a regular dues-paying member of the Party, at least from 1949 to 1951, and there is no evidence that his membership terminated at the latter date. When the Party was reorganized into smaller units, petitioner was transferred to a new group and he was seen 15 times ('it could be 15, it could be more') at meetings of the unit which were restricted to Party members. 'He was an official of the club because he attended a few executive meetings of the Forty-Fifth,' at one of which he was seen by the government witness. This meeting was 'either organizational or to form an agenda for the regular meeting.' Attendance at executive meetings was restricted 'to Party members and probably officials of the club.' At one time petitioner was transferred out of the Mexican Concentration Club 'for some other job.' Petitioner was also known to have attended at least one Party convention, attendance at which was restricted to Party members—'you had to face the panel and give your club, your position of that club, and be identified by the members that were on the, on this panel, before you were admitted.' At the conventions, 'they would have discussions on what was going on in the Party, and what drives were coming up.'
22
These facts are sufficient basis for the Board's finding of voluntary, meaningful membership.* After regular attendance at Party Meetings and functions, and regular financial support for its activities, it is rather fanciful to believe petitioner was still unaware of the political nature of the Communist Party. It is doubtful that the meetings were so ineptly run or structured.
23
To be sure, facts purporting to show voluntary membership can be explained away and rendered meaningless by further facts as in Rowoldt. But here petitioner did not testify and did not attempt to characterize or to limit the significance of his association with the Party. In the circumstances 'it is enough that the alien joined the Party, aware that he was joining an organization known as the Communist Party which operates as a distinct and active political organization, and that he did so of his own free will. A fair reading of the legislation requires that this scope be given to what Congress enacted * * *.' Galvan v. Press, 347 U.S. at 528, 74 S.Ct., at 741.
24
I would therefore affirm the repeated holdings of the courts below, made after several thorough examinations of the record. 'This is not the place to review a conflict of evidence nor to reverse a Court of Appeals because were we in its place we would find the record tilting one way rather than the other, though fairminded judges could find it tilting either way.' National Labor Relations Board v. Pittsburgh S.S. Co., 340 U.S. 498, 503, 71 S.Ct. 453, 456, 95 L.Ed. 479. 'We do no more on the issue of insubstantiality than decide that the Court of Appeals has made a 'fair assessment' of the record.' Federal Trade Comm. v. Standard Oil Co., 355 U.S. 396, 401, 78 S.Ct. 369, 372, 2 L.Ed.2d 359; Peurifoy v. Commissioner, 358 U.S. 59, 61, 79 S.Ct. 104, 105, 3 L.Ed.2d 30; National Labor Relations Board v. Pittsburgh S.S. Co., 340 U.S. 498, 502, 71 S.Ct. 453, 455, 95 L.Ed. 479. 'This Court will intervene only in what ought to be the rare instance when the standard appears to have been misapprehended or grossly misapplied.' Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 491, 71 S.Ct. 456, 466, 95 L.Ed. 456.
1
'(a) Any alien in the United States * * * shall, upon the order of the Attorney General, be deported who—
'(6) is or at any time has been after entry, a member of any of the following classes of aliens:
'(C) Aliens who are members of or affiliated with (i) the Communist Party of the United States * * *.'
2
There is no dispute before this Court, nor could there be, that under Galvan, supra, 347 U.S. at 528, 74 S.Ct. at 741, the absence of personal advocacy of violent overthrow is not by itself a bar to deportability under § 241(a)(6)(C). See pp. 473—474, infra.
3
See, e.g., Aaron, Writers on the Left (1961), 149—160; Decter, The Profile of Communism (1961), 50—51; Ernst and Loth, Report on the American Communist (1952), passim; Glazer, The Social Basis of American Communism (1961), 115 and passim.
4
Compare Yates v. United States, 354 U.S. 298, 327—333, 77 S.Ct. 1064, 1081—1084, 1 L.Ed.2d 1356; Scales v. United States, 367 U.S. 203, 222—223, 230—255, 81 S.Ct. 1469, 1486—1499, 6 L.Ed.2d 782; Noto v. United States, 367 U.S. 290, 81 S.Ct. 1517, 6 L.Ed.2d 836.
5
Elorriaga's testimony on direct examination was as follows:
'Q. Now you say you met him in meetings of that club, how often would you say you saw the respondent in meetings of that club?
'A. How often, about maybe three or four meetings a month.'
One possible explanation of the apparent contradiction is that Elorriaga understood the question on direct examination as merely an inquiry into how often club meetings were held, and answered accordingly. This is borne out to some extent by the fact that the witness gave his 'revised' answer to the question on two separate occasions, some minutes apart, during the redirect examination.
6
Since some activities may be engaged in without the requisite awareness, satisfaction of the Government's burden as to the ultimate fact of 'meaningful association' by evidence of activities instead of by direct evidence of awareness of the Party's 'distinct and active political' nature must be based upon evidence of activities sufficient to give substantial support to an inference of the alien's awareness of the Party's political aspect. The sole aspect of the witness Scarletto's testimony which might have implied that petitioner's association with the Party was 'meaningful' was his reference to having seen petitioner at one Los Angeles area convention of the Party. However, in contrast to the testimony in Niukkanen v. McAlexander, 362 U.S. 390, 80 S.Ct. 799, 4 L.Ed.2d 816, note 7, infra, Scarletto neither described what petitioner would have heard at the convention nor suggested that there was any prerequisite such as officership or executive responsibility to petitioner's attendance at the convention. Scarletto said that the nature of such conventions generally was that 'they would have discussions on what was going on in the Party, and what drives were coming up,' but did not elaborate this statement with reference to the convention that petitioner attended or to what petitioner did there. Scarletto could only be sure that petitioner had to be a member to be present. The only facet of Elorriaga's testimony which touched upon the qualitative aspect of petitioner's membership was his statement that he had seen petitioner at one executive board meeting of the Party unit. However, in contrast to the testimony in Galvan, supra, 347 U.S. at 524, 529, 74 S.Ct. at 741, he only supposed petitioner to have been an 'official of the club' because of petitioner's presence at an executive meeting which Elorriaga thought was 'probably' limited to 'officials of the club,' and he did not elaborate specifically upon the significance of petitioner's presence at the one meeting, making only the general statement that '(a)t this time I cannot say definitely the purpose (of that meeting) but it was either organizational or to form an agenda for the regular meeting.' Thus, none of the testimony of either Scarletto or Elorriaga was significantly probative of petitioner's 'meaningful association' with the Party.
7
This Court's later per curiam decision in Niukkanen v. McAlexander, 362 U.S. 390, 80 S.Ct. 799, 4 L.Ed.2d 816, in no way qualified the meaning of Rowoldt since the evidence in the record in Niukkanen clearly showed 'meaningful association.' See Niukkanen v. McAlexander, 265 F.2d 825 (C.A.9th Cir. 1959). Two witnesses testified for the Government. Both confirmed Niukkanen's Party membership and his regular attendance at meetings. In addition, one witness testified that Niukkanen helped in the distribution of a Communist-controlled trade-union newspaper edited by the witness, and actively participated in discussions at the newspaper office and elsewhere pertaining to policies of the Communist Party and circulation of the newspaper as a Communist organ. This witness also testified that Niukkanen had attended a regional 'plenum' of the Party—a meeting wherein all aspects of regional Party activities were reported on. Such a meeting, said the witness, was only for the 'anointed people,' the 'top fraction' in the Party, to which, the witness added, Niukkanen belonged. The other witness, who had been a member of the same unit of the Party as Niukkanen, added that Niukkanen, although never an officer of the unit, was a member of its executive board.
Nor is Galvan, supra, which was decided before Rowoldt, inconsistent with either that case or the present one. Mr. Justice Frankfurter, who wrote the Court's opinions in both Galvan and Rowoldt, stated in Rowoldt that '(t)he differences on the facts between Galvan v. Press, supra, and this case are too obvious to be detailed.' 355 U.S., at 121, 78 S.Ct., at 184.
8
In the present case, for example, deportation would remove a man who has resided in this country since 1920 when he came from Mexico as a 10-year-old boy, and has raised and supported a family who are all American citizens.
9
Our disposition of the case makes it unnecessary to consider petitioner's contention that 'at least the spirit' of 28 U.S.C. § 46 was violated when the panel of the Court of Appeals assigned to hear petitioner's appeal in the current series of proceedings transferred the appeal instead to the same panel which had heard his first appeal, 109 U.S.App.D.C. 267, 286 F.2d 824, it being clearly predictable that one of the three judges on that panel would not participate, since he had been unable to participate in the disposition of the first appeal.
*
The Court is concerned about the insufficiency of the 'direct' and 'indirect' evidence of awareness and participation. The record, though, contains 'direct' evidence from Scarletto, who saw petitioner at Party meetings and at a convention, and who testified that at such conventions 'they would have discussions on what was going on in the Party.' Elorriaga stated that he saw petitioner at an executive meeting 'either organizational or to form an agenda for the regular meeting.' Both witnesses testified 'directly' that petitioner was a duespaying member and attended Party meetings. To me this uncontradicted testimony plainly is 'direct' evidence that petitioner was aware of the distinct and active political nature of the Communist Party or at the very least sufficient 'indirect' evidence from which an inference of meaningful membership could be drawn.
| 12
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374 U.S. 321
83 S.Ct. 1715
10 L.Ed.2d 915
UNITED STATES, Appellant,v.The PHILADELPHIA NATIONAL BANK et al.
No. 83.
Argued Feb. 20, 1963.
Decided June 17, 1963.
[Syllabus from pages 321-322 intentionally omitted]
Lee Loevinger, Washington, D.C., for appellant.
Philip Price, Philadelphia, Pa., for appellees.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
The United States, appellant here, brought this civil action in the United States District Court for the Eastern District of Pennsylvania under § 4 of the Sherman Act, 15 U.S.C. § 4, and § 15 of the Clayton Act, 15 U.S.C. § 25, to enjoin a proposed merger of The Philadelphia National Bank (PNB) and Girard Trust Corn Exchange Bank (Girard), appellees here. The complaint charged violations of § 1 of the Sherman Act, 15 U.S.C. § 1, and § 7 of the Clayton Act, 15 U.S.C. § 18.1 From a judgment for appellees after trial, see D.C., 201 F.Supp. 348, the United States appealed to this Court under § 2 of the Expediting Act, 15 U.S.C. § 29. Probable jurisdiction was noted. 369 U.S. 883, 82 S.Ct. 1156, 8 L.Ed.2d 285. We reverse the judgment of the District Court. We hold that the merger of appellees is forbidden by § 7 of the Clayton Act and so must be enjoined; we need not, and therefore do not, reach the further question of alleged violation of § 1 of the Sherman Act.
I. THE FACTS AND PROCEEDINGS BELOW.
2
A. The Background: Commercial Banking in the United States.
3
Because this is the first case which has required this Court to consider the application of the antitrust laws to the commercial banking industry, and because aspects of the industry and of the degree of governmental regulation of it will recur throughout our discussion, we deem it appropriate to begin with a brief background description.2
4
Commercial banking in this country is primarily unit banking. That is, control of commercial banking is diffused throughout a very large number of independent, local banks—13,460 of them in 1960—rather than concentrated in a handful of nationwide banks, as, for example, in England and Germany. There are, to be sure, in addition to the independent banks, some 10,000 branch banks; but branching, which is controlled largely by state law—and prohibited altogether by some States—enables a bank to extend itself only to state lines and often not that far.3 It is also the case, of course, that many banks place loans and solicit deposits outside their home area. But with these qualifications, it remains true that ours is essentially a decentralized system of community banks. Recent years, however, have witnessed a definite trend toward concentration. Thus, during the decade ending in 1960 the number of commercial banks in the United States declined by 714, despite the chartering of 887 new banks and a very substantial increase in the Nation's credit needs during the period. Of the 1,601 independent banks which thus disappeared, 1,503, with combined total resources of well over $25,000,000,000, disappeared as the result of mergers.
5
Commercial banks are unique among financial institutions in that they alone are permitted by law to accept demand deposits. This distinctive power gives commercial banking a key role in the national economy. For banks do not merely deal in but are actually a source of, money and credit; when a bank makes a loan by crediting the borrower's demand deposit account, it augments the Nation's credit supply.4 Furthermore, the power to accept demand deposits makes banks the intermediaries in most financial transactions (since transfers of substantial moneys are almost always by check rather than by cash) and, concomitantly, the repositories of very substantial individual and corporate funds. The banks' use of these funds is conditioned by the fact that their working capital consists very largely of demand deposits, which makes liquidity the guiding principle of bank lending and investing policies; thus it is that banks are the chief source of the country's short-term business credit.
6
Banking operations are varied and complex; 'commercial banking' describes a congeries of services and credit devices.5 But among them the creation of additional money and credit, the management of the checking-account system, and the furnishing of short-term business loans would appear to be the most important. For the proper discharge of these functions is indispensable to a healthy national economy, as the role of bank failures in depression periods attests. It is therefore not surprising that commercial banking in the United States is subject to a variety of governmental controls, state and federal. Federal regulation is the more extensive, and our focus will be upon it. It extends not only to the national banks, i.e., banks chartered under federal law and supervised by the Comptroller of the Currency, see 12 U.S.C. § 21 et seq. For many state banks, see 12 U.S.C. § 321, as well as virtually all the national banks. 12 U.S.C. § 222, are members of the Federal Reserve System (FRS), and more than 95% of all banks, see 12 U.S.C. § 1815, are insured by the Federal Deposit Insurance Corporation (FDIC). State member and nonmember insured banks are subject to a federal regulatory scheme almost as elaborate as that which governs the national banks.
7
The governmental controls of American banking are manifold. First, the Federal Reserve System, through its open-market operations, see 12 U.S.C. §§ 263(c), 353—359, control of the rediscount rate, see 12 U.S.C. § 357, and modifications of reserve requirements, see 12 U.S.C. ss 462, 462b, regulates the supply of money and credit in the economy and thereby indirectly regulates the interest rates of bank loans. This is not, however, rate regulation. The Reserve System's activities are only designed to influence the prime, i.e., minimum, bank interest rate. There is no federal control of the maximum, although all banks, state and national, are subject to state usury laws where applicable. See 12 U.S.C. § 85. In the range between the maximum fixed by state usury laws and the practical minimum set by federal fiscal policies (there is no law against undercutting the prime rate but bankers seldom do), bankers are free to price their loans as they choose. Moreover, charges for other banking services, such as service charges for checking privileges, are free of governmental regulation, state or federal.
8
Entry, branching, and acquisitions are covered by a network of state and federal statutes. A charter for a new bank, state or national, will not be granted unless the invested capital and management of the applicant, and its prospects for doing sufficient business to operate at a reasonable profit, give adequate protection against undue competition and possible failure. See, e.g., 12 U.S.C. §§ 26, 27, 51; 12 CFR § 4.1(b); Pa.Stat.Ann., Tit. 7, § 819—306. Failure to meet these standards may cause the FDIC to refuse an application for insurance, 12 U.S.C. §§ 1815, 1816, and may cause the FDIC, Federal Reserve Board (FRB), and Comptroller to refuse permission to branch to insured, member, and national banks, respectively. 12 U.S.C. §§ 36, 321, 1828(d). Permission to merge, consolidate, acquire assets, or assume liabilities may be refused by the agencies on the same grounds. 12 U.S.C. (1958 ed., Supp. IV) § 1828(c), note 8, infra. Furthermore, national banks appear to be subject to state geographical limitations on branching. See 12 U.S.C. § 36(c).
9
Banks are also subject to a number of specific provisions aimed at ensuring sound banking practices. For example, member banks of the Federal Reserve System may not pay interest on demand deposits, 12 U.S.C. § 371a, may not invest in common stocks or hold for their own account investment securities of any one obligor in excess of 10% of the bank's unimpaired capital and surplus, see 12 U.S.C. §§ 24 Seventh, 335, and may not pay interest on time or savings deposits above the rate fixed by the FRB, 12 U.S.C. § 371b. The payment of interest on deposits by nonmember insured banks is also federally regulated. 12 U.S.C. (1958 ed., Supp. IV) § 1828(g); 12 CFR, 1962 Supp., Part 329. In the case of national banks, the 10% limit on the obligations of a single obligor includes loans as well as investment securities. See 12 U.S.C. § 84. Pennsylvania imposes the same limitation upon banks chartered under its laws, such as Girard. Pa.Stat.Ann. (1961 Supp.), Tit. 7, § 819—1006.
10
But perhaps the most effective weapon of federal regulation of banking is the broad visitorial power of federal bank examiners. Whenever the agencies deem it necessary, they may order 'a thorough examination of all the affairs of the bank,' whether it be a member of the FRS or a nonmember insured bank. 12 U.S.C. §§ 325, 481, 483, 1820(b); 12 CFR § 4.2. Such examinations are frequent and intensive. In addition, the banks are required to furnish detailed periodic reports of their operations to the supervisory agencies. 12 U.S.C. §§ 161, 324, 1820(e). In this way the agencies maintain virtually a day-to-day surveillance of the American banking system. And should they discover unsound banking practices, they are equipped with a formidable array of sanctions. If in the judgment of the FRB a member bank is making 'undue use of bank credit,' the Board may suspend the bank from the use of the credit facilities of the FRS. 12 U.S.C. § 301. The FDIC has an even more formidable power. If it finds 'unsafe or unsound practices' in the conduct of the business of any insured bank, it may terminate the bank's insured status. 12 U.S.C. § 1818(a). Such involuntary termination severs the bank's membership in the FRS, if it is a state bank, and throws it into receivership if it is a national bank. 12 U.S.C. § 1818(b). Lesser, but nevertheless drastic, sanctions include publication of the results of bank examinations. 12 U.S.C. §§ 481, 1828(f). As a result of the existence of this panoply of sanctions, recommendations by the agencies concerning banking practices tend to be followed by bankers without the necessity of formal compliance proceedings. 1 Davis, Administrative Law (1958), § 4.04.
11
Federal supervision of banking has been called '(p)robably the outstanding example in the federal government of regulation of an entire industry through methods of supervision. * * * The system may be one of the most successful (systems of economic regulation), if not the most successful.' Id., § 4.04, at 247. To the efficacy of this system we may owe, in part, the virtual disapperance of bank failures from the American economic scene.6
12
B. The Proposed Merger of PNB and Girard.
13
The Philadelphia National Bank and Girard Trust Corn Exchange Bank are, respectively, the second and third largest of the 42 commercial banks with head offices in the Philadelphia metropolitan area, which consists of the City of Philadelphia and its three contiguous counties in Pennsylvania. The home county of both banks is the city itself; Pennsylvania law, however, permits branching into the counties contiguous to the home county, Pa.Stat.Ann. (1961 Supp.), Tit. 7, § 819—204.1, and both banks have offices throughout the four-county area. PNB, a national bank, has assets of over $1,000,000,000, making it (as of 1959) the twenty-first largest bank in the Nation. Girard a state bank is a member of the FRS and is insured by the FDIC; it has assets of about $750,000,000. Were the proposed merger to be consummated, the resulting bank would be the largest in the four-county area, with (approximately) 36% of the area banks' total assets, 36% of deposits, and 34% of net loans. It and the second largest (First Pennsylvania Bank and Trust Company, now the largest) would have between them 59% of the total assets, 58% of deposits, and 58% of the net loans, while after the merger the four largest banks in the area would have 78% of total assets, 77% of deposits, and 78% of net loans.
14
The present size of both PNB and Girard is in part the result of mergers. Indeed, the trend toward concentration is noticeable in the Philadelphia area generally, in which the number of commercial banks has declined from 108 in 1947 to the present 42. Since 1950, PNB has acquired nine formerly independent banks and Girard six; and these acquisitions have accounted for 59% and 85% of the respective banks' asset growth during the period, 63% and 91% of their deposit growth, and 12% and 37% of their loan growth. During this period, the seven largest banks in the area increased their combined share of the area's total commercial bank resources from about 61% to about 90%.
15
In November 1960 the boards of directors of the two banks approved a proposed agreement for their consolidation under the PNB charter. By the terms of the agreement, PNB's stockholders were to retain their share certificates, which would be deemed to represent an equal number of shares in the consolidated bank, while Girard's stockholders would surrender their shares in exchange for shares in the consolidated bank, receiving 1.2875 such shares for each Girard share. Such a consolidation is authorized, subject to the approval of the Comptroller of the Currency, by 12 U.S.C. (1958 ed., Supp. IV) § 2157 But under the Bank Merger Act of 1960, 12 U.S.C. (1963 ed., Supp. IV) § 1828(c), the Comptroller may not give his approval until he has received reports from the other two banking agencies and the Attorney General respecting the probable effects of the proposed transaction on competition.8 All three reports advised that the proposed merger would have substantial anticompetitive effects in the Philadelphia metropolitan area. However, on February 24, 1961, the Comptroller approved the merger. No opinion was rendered at that time. But as required by § 1828(c), the Comptroller explained the basis for his decision to approve the merger in a statement to be included in his annual report to Congress. As to effect upon competition, he reasoned that '(s)ince there will remain an adequate number of alternative sources of banking service in Philadelphia, and in view of the beneficial effects of this consolidation upon international and national competition it was concluded that the over-all effect upon competition would not be unfavorable.' He also stated that the consolidated bank 'would be far better able to serve the convenience and needs of its community by being of material assistance to its city and state in their efforts to attract new industry and to retain existing industry.' The day after the Comptroller approved the merger, the United States commenced the present action. No steps have been taken to consummate the merger pending the outcome of this litigation.
16
C. The Trial and the District Court's Decision.
17
The Government's case in the District Court relied chiefly on statistical evidence bearing upon market structure and on testimony by economists and bankers to the effect that, notwithstanding the intensive governmental regulation of banking, there was a substantial area for the free play of competitive forces; that concentration of commercial banking, which the proposed merger would increase, was inimical to that free play; that the principal anticompetitive effect of the merger would be felt in the area in which the banks had their offices, thus making the four-county metropolitan area the relevant geographical market; and that commercial banking was the relevant product market. The defendants, in addition to offering contrary evidence on these points, attempted to show business justifications for the merger. They conceded that both banks were economically strong and had sound management, but offered the testimony of bankers to show that the resulting bank, with its greater prestige and increased lending limit,9 would be better able to compete with large out-of-state (particularly New York) banks, would attract new business to Philadelphia, and in general would promote the economic development of the metropolitan area.10
18
Upon this record, the District Court held that: (1) the passage of the Bank Merger Act of 1960 did not repeal by implication the antitrust laws insofar as they may apply to bank mergers; (2) § 7 of the Clayton Act is inapplicable to bank mergers because banks are not corporations 'subject to the jurisdiction of the Federal Trade Commission'; (3) but assuming that § 7 is applicable, the four-county Philadelphia metropolitan area is not the relevant geographical market because PNB and Girard actively compete with other banks for bank business throughout the greater part of the northeastern United States; (4) but even assuming that § 7 is applicable and that the four-county area is the relevant market, there is no reasonable probability that competition among commercial banks in the area will be substantially lessened as the result of the merger; (5) since the merger does not violate § 7 of the Clayton Act, a fortiori it does not violate § 1 of the Sherman Act; (6) the merger will benefit the Philadelphia metropolitan area economically. The District Court also ruled that for the purposes of § 7, commercial banking is a line of
19
commerce; the appellees do not contest this ruling. II. THE APPLICABILITY OF SECTION 7 OF THE CLAYTON ACT TO BANK MERGERS.
20
A. The Original Section and the 1950 Amendment.
21
By its terms, the present § 7 reaches acquisitions of corporate stock or share capital by any corporation engaged in commerce, but it reaches acquisitions of corporate assets only by corporations 'subject to the jurisdiction of the Federal Trade Commission.' The FTC, under § 5 of the Federal Trade Commission Act, has no jurisdiction over banks. 15 U.S.C. § 45(a)(6).11 Therefore, if the proposed merger be deemed an assets acquisition, it is not within § 7.12 Appellant argues vigorously that a merger is crucially different from a pure assets acquisition,13 and appellees argue with equal vigor that it is crucially different from a pure stock acquisition.14 Both positions, we think, have merit; a merger fits neither category neatly. Since the literal terms of § 7 thus do not dispose of our question, we must determine whether a congressional design to embrace bank mergers is revealed in the history of the statute. The question appears to be one of first impression; we have been directed to no previous case in which a merger or consolidation was challenged under § 7 of the Clayton Act, as amended, where the acquiring corporation was not subject to the FTC's jurisdiction.
22
When it was first enacted in 1914, § 7 referred only to corporate acquisitions of stock and share capital; it was silent as to assets acquisitions and as to mergers and consolidations. Act of October 15, 1914, c. 323, § 7, 38 Stat. 731 732, note 18, infra. It is true that the omission may not have been an oversight. Congress' principal concern was with the activities of holding companies, and specifically with the practice whereby corporations secretly acquired control of their competitors by purchasing the stock of those companies. Although assets acquisitions and mergers were known forms of corporate amalgamation at the time, their no less dangerously anticompetitive effects may not have been fully apparent to the Congress.15 Still, the statutory language, read in the light of the overriding congressional purpose to control corporate concentrations tending to monopoly, lent itself to a construction whereby § 7 would have reached at least mergers and consolidations. It would hardly have done violence to the language so to have interpreted the vague term 'share capital,' see 30 Geo.Wash.L.Rev. 1024, 1027—1028 (1962), or to have adopted the view that: 'where the assets are exchanged for the stock of the purchasing company, assuming that the two companies were previously in competition, it is apparent that the seller has acquired stock in a competing company * * * (and) therefore that in effecting the merger section 7 was violated and hence the distribution of the stock received by the selling company to its shareholders and its subsequent dissolution are no bar to proceedings by the government to set aside the purchase.' Handler, Industrial Mergers and the Anti-Trust Laws, 32 Col.L.Rev. 179, 266 (1932).16
23
But the courts found mergers to be beyond the reach of § 7, even when the merger technique had supplanted stock acquisitions as the prevalent mode of corporate amalgamation. United States v. Celanese Corp. of America, 91 F.Supp. 14 (D.C.S.D.N.Y.1950); see Thatcher Mfg. Co. v. Federal Trade Comm'n and Swift & Co. v. Federal Trade Comm'n, decided together with Federal Trade Comm'n v. Western Meat Co., 272 U.S. 554, 47 S.Ct. 175, 71 L.Ed. 405; Arrow-Hart & Hegeman Elec. Co. v. Federal Trade Comm'n, 291 U.S. 587, 54 S.Ct. 532, 78 L.Ed. 1007.17 As a result, § 7 became largely a dead letter. Comment, 68 Yale L.J. 1627, 1629—1630 (1959); see Federal Trade Commission, The Merger Movement: A Summary Report (1948), 1, 3—6; Henderson, The Federal Trade Commission (1924), 40. Meanwhile, this Court's decision in United States v. Columbia Steel Co., 334 U.S. 495, 68 S.Ct. 1107, 92 L.Ed. 1533, stirred concern whether the Sherman Act alone was a check against corporate acquisitions. Note, 52 Col.L.Rev. 766, 768 (1952).
24
It was against this background that Congress in 1950 amended § 7 to include an assets-acquisition provision. Act of December 29, 1950 (Celler-Kefauver Antimerger Act), c. 1184, 64 Stat. 1125 1126, 15 U.S.C. § 18.18 The legislative history is silent on the specific questions why the amendment made no explicit reference to mergers, why assets acquisitions by corporations not subject to FTC jurisdiction were not included, and what these omissions signify. Nevertheless, the basic congressional design clearly emerges and from that design the answers to these questions may be inferred. Congress primarily sought to bring mergers within § 7 and thereby close what it regarded as a loophole in the section.19 But, in addition, it sought to reach transactions such as that involved in Columbia Steel, which was a simple purchase of assets and not a merger.20 In other words, Congress contemplated that the 1950 amendment would give § 7 a reach which would bring the entire range of corporate amalgamations, from pure stock acquisitions to pure assets acquisitions, within the scope of § 7. Thus, the stock-acquisition and assets-acquisition provisions, read together, reach mergers, which fit neither category perfectly but lie somewhere between the two ends of the spectrum. See pp. 336—337, and notes 13, 14, supra. So construed, the specific exception for acquiring corporations not subject to the FTC's jurisdiction excludes from the coverage of § 7 only assets acquisitions by such corporations when not accomplished by merger.
25
This construction is supported by a number of specific considerations.
26
First. Any other construction would be illogical and disrespectful of the plain congressional purpose in amending § 7, because it would create a large loophole in a statute designed to close a loophole. It is unquestioned that the stock-acquisition provision of § 7 embraces every corporation engaged in commerce, including banks. And it is plain that Congress, in amending § 7, considered a distinction for antitrust purposes between acquisition of corporate control by purchase of stock and acquisition by merger unsupportable in reason, and sought to overrule the decisions of this Court which had recognized such a distinction.21 If, therefore, mergers in industries outside the FTC's jurisdiction were deemed beyond the reach of § 7, the result would be precisely that difference in treatment which Congress rejected. On the other hand, excluding from the section assets acquisitions not by merger in those industries does not appear to create a lacuna of practical importance.22
27
Second. The Congress which debated the bill to amend § 7 was fully aware of the important differences between a merger and a pure purchase of assets. For example, Senator Kilgore, remarked:
28
'When you talk about mergers, you are talking about a stock transaction. * * *
29
'* * * (A)ctually what you do is merge the stockholdings of both corporations, and instead of that—I am thinking in practical terms—you merge the corporate entities of the two corporations and you get one corporation out of it, and you issue stock in the one corporation in lieu of the stock in the other corporation, whereupon the stock of the corporation which had been merged is canceled by the new corporation, and you have one corporation handling the operation of two. So it really is a stock transaction in the final wind-up, regardless of what you call it. But what I call a purchase of assets is where you purchase physical assets, things upon which you could lay your hand, either in the records or on the ground * * *.' Hearings before a Subcommittee of the Senate Committee on the Judiciary on Corporate Mergers and Acquisitions, 81st Cong., 1st and 2d Sess. 176; to the same effect, see, e.g., id., at 100, 139, 320—325.
30
Plainly, acquisition of 'assets' as used in amended § 7 was not meant to be a simple equivalent of acquisition by merger, but was intended rather to ensure against the blunting of the antimerger thrust of the section by evasive transactions such as had rendered the original section ineffectual. Thus, the stock-acquisition provision of § 7, though reenacted in haec verba by the 1950 amendment, must be deemed expanded in its new context to include, at the very least, acquisitions by merger or consolidation, transactions which entail a transfer of stock of the parties, while the assets-acquisition provision clearly reaches corporate acquisitions involving no such transfer. And see note 22, supra. This seems to be the point of Congressman Patman's remark, typical of many, that: 'What this bill does is to put all corporate mergers on the same footing, whether the result of the acquisitions of stock or the acquisition of physical assets.' Hearings, supra, at 126. To the same effect is the House Report on the bill to amend § 7: 'The bill retains language of the present statute which is broad enough to prevent evasion of the central purpose. It covers not only purchase of assets or stock but also any other method of acquisition * * *. It forbids not only direct acquisitions but also indirect acquisitions * * *.' H.R.Rep.No.1191, 81st Cong., 1st Sess. 8—9.
31
Third. The legislative history shows that the objective of including the phrase 'corporation subject to the jurisdiction of the Federal Trade Commission' in § 7 was not to limit the amalgamations to be covered by the amended statute but to make explicit the role of the FTC in administering the section. The predominant focus of the hearings, debates, and committee reports was upon the powers of the FTC. The decisions of this Court which had uncovered the loophole in the original § 7—Thatcher, Swift, and Arrow-Hart—had not rested directly upon the substantive coverage of § 7, but rather upon the limited scope of the FTC's divestiture powers under § 11. See note 17, supra. There were intimations that the courts' power to enforce § 7 might be far greater. See Thatcher Mfg. Co. v. Federal Trade Comm'n, supra, 272 U.S., at 561, 47 S.Ct, at 178, 71 L.Ed. 405; Swift & Co. v. Federal Trade Comm'n, supra, 272 U.S., at 563, 47 S.Ct., at 178—179, 71 L.Ed. 405; Federal Trade Comm'n v. Eastman Kodak Co., 274 U.S. 619, 624, 47 S.Ct. 688, 689—690, 71 L.Ed. 1238; Arrow-Hart & Hegeman Elec. Co. v. Federal Trade Comm'n, supra, 291 U.S., at 598—599, 54 S.Ct., at 537, 78 L.Ed. 1007; Irvine, The Uncertainties of Section 7 of the Clayton Act, 14 Cornell L.Q. 28 (1928). Thus, the loophole was sometimes viewed as primarily a gap in the FTC's jurisdiction.23 Furthermore, although the Clayton Act has always provided for dual enforcement by court and agency, see 15 U.S.C. § 25; United States v. W. T. Grant Co., 345 U.S. 629, 73 S.Ct. 894, 97 L.Ed. 1303; United States Alkali Export Assn. v. United States, 325 U.S. 196, 208, 65 S.Ct. 1120, 1127, 89 L.Ed. 1554, prior to the 1950 amendment enforcement of § 7 was left largely to the FTC. Martin, Mergers and the Clayton Act (1959), 205, 219; Montague, The Celler Anti-Merger Act: An Administrative Problem in an Economic Crisis, 37 A.B.A.J. 253 (1951). And the impetus to amend § 7 came in large part from the FTC. See, e.g., Martin, supra, 187—194; Federal Trade Commission, Annual Reports, 1928, pp. 18—19; 1940, pp. 12—13; 1948, pp. 11—22; The Merger Movement: A Summary Report (1948). Congress in 1950 clearly intended to remove all question concerning the FTC's remedial power over corporate acquisitions, and therefore explicitly enlarged the FTC's jurisdiction. Congress' choice of this means of underscoring the FTC's role in enforcing § 7 provides no basis for a construction which would undercut the dominant congressional purpose of eliminating the difference in treatment accorded stock acquisitions and mergers by the original § 7 as construed.
32
Fourth. It is settled law that '(i)mmunity from the antitrust laws is not lightly implied.' People of State of California v. Federal Power Comm'n, 369 U.S. 482, 485, 82 S.Ct. 901, 903—904, 8 L.Ed.2d 54. Cf. United States v. Borden Co., 308 U.S. 188, 198 199, 60 S.Ct. 182, 188—189, 84 L.Ed. 181; United States v. Southern Pac. Co., 259 U.S. 214, 239—240, 42 S.Ct. 496, 501—502, 66 L.Ed. 907. This canon of construction, which reflects the felt indispensable role of antitrust policy in the maintenance of a free economy, is controlling here. For there is no indication in the legislative history to the 1950 amendment of § 7 that Congress wished to confer a special dispensation upon the banking industry; if Congress had so wished, moreover, surely it would have exempted the industry from the stock-acquisition as well as the assets-acquisition provision.
33
Of course, our construction of the amended § 7 is not foreclosed because, after the passage of the amendment, some members of Congress, and for a time the Justice Department, voiced the view that bank mergers were still beyond the reach of the section.24 '(T)he views of a subsequent Congress form a hazardous basis for inferring the intent of an earlier one.' United States v. Price, 361 U.S. 304, 313, 80 S.Ct. 326, 332, 4 L.Ed.2d 334; see Rainwater v. United States, 356 U.S. 590, 593, 78 S.Ct. 946, 2 L.Ed.2d 996; United States v. United Mine Workers, 330 U.S. 258, 282, 67 S.Ct. 677, 91 L.Ed. 884; cf. United States v. E. I. Du Pont De Nemours & Co., 353 U.S. 586, 590, 77 S.Ct. 872, 875—876, 1 L.Ed.2d 1057. This holds true even though misunderstanding of the scope of § 7 may have played some part in the passage of the Bank Merger Act of 1960.25 There is a question, to which we shall shortly turn, whether there exists such inconsistency between the Bank Merger Act and § 7, as we now construe it, as to require a holding that § 7 must be deemed repealed pro tanto; but that is a different question from whether misunderstanding of the scope of § 7 is relevant to our task of defining what scope Congress gave the section in 1950. When Congress enacted the Bank Merger Act, the applicability of § 7 to bank mergers was still to be authoritatively determined; it was a subject of speculation. Thus, this is not a case in which our 'earlier decisions are part of the arch on which the new structure rests, (and) we (must) refrain from disturbing them lest we change the design that Congress fashioned.' State Board of Ins. v. Todd Shipyards Corp., 370 U.S. 451, 458, 82 S.Ct. 1380, 1385, 8 L.Ed.2d 620. Cf. note 17, supra. The design fashioned in the Bank Merger Act was predicated upon uncertainty as to the scope of § 7, and we do no violence to that design by dispelling the uncertainty.
34
B. The Effect of the Bank Merger Act of 1960.
35
Appellees contended below that the Bank Merger Act, by directing the banking agencies to consider competitive factors before approving mergers, 12 U.S.C. (1958 ed., Supp. IV) § 1828(c), note 8, supra, immunizes approved mergers from challenge under the federal antitrust laws.26 We think the District Court was correct in rejecting this contention. No express immunity is conferred by the Act.27 Repeals of the antitrust laws by implication from a regulatory statute are strongly disfavored,28 and have only been found in cases of plain repugnancy between the antitrust and regulatory provisions.29 Two recent cases, Pan American World Airways v. United States, 371 U.S. 296, 83 S.Ct. 476, 9 L.Ed.2d 325, and People of State of California v. Federal Power Comm'n, 369 U.S. 482, 82 S.Ct. 901, 8 L.Ed.2d 54, illustrate this principle. In Pan American, the Court held that because the Civil Aeronautics Board had been given broad powers to enforce the competitive standard clearly delineated by the Civil Aeronautics Act, and to immunize a variety of transactions from the operation of the antitrust laws, the Sherman Act could not be applied to facts composing the precise ingredients of a case subject to the Board's broad regulatory and remedial powers; in contrast, the banking agencies have authority neither to enforce the antitrust laws against mergers, cf. note 22, supra, nor to grant immunity from those laws.
36
In the California case, on the other hand, the Court held that the FPC's approval of a merger did not confer immunity from § 7 of the Clayton Act, even though, as in the instant case, the agency had taken the competitive factor into account in passing upon the merger application. See 369 U.S., at 484—485, 487—488, 82 S.Ct., at 903—904, 905, 8 L.Ed.2d 54. We think California is controlling here. Although the Comptroller was required to consider effect upon competition in passing upon appellees' merger application, he was not required to give this factor any particular weight; he was not even required to (and did not) hold a hearing before approving the application; and there is no specific provision for judicial review of his decision.30 Plainly, the range and scope of administrative powers under the Bank Merger Act bear little resemblance to those involved in Pan American.
37
Nor die Congress, in passing the Bank Merger Act, embrace the view that federal regulation of banking is so comprehensive that enforcement of the antitrust laws would be either unnecessary, in light of the completeness of the regulatory structure, or disruptive of that structure. On the contrary, the legislative history of the Act seems clearly to refute any suggestion that applicability of the antitrust laws was to be affected. Both the House and Senate Committee Reports stated that the Act would not affect in any way the applicability of the antitrust laws to bank acquisitions. H.R.Rep. No. 1416, 86th Cong., 2d Sess. 9; S.Rep. No. 196, 86th Cong., 1st Sess. 3. See also, e.g., 105 Cong.Rec. 8131 (remarks of Senator Rebertson, the Act's sponsor). Moreover, bank regulation is in most respects less complete than public utility regulation, to which interstate rail and air carriers, among others, are subject. Rate regulation in the banking industry is limited and largely indirect, see p. 328, supra; banks are under no duty not to discriminate in their services; and though the location of bank offices is regulated, banks may do business place loans and solicit deposits—where they please. The fact that the banking agencies maintain a close surveillance of the industry with a view toward preventing unsound practices that might impair liquidity or lead to insolvency does not make federal banking regulation all-pervasive, although it does minimize the hazards of intense competition. Indeed, that there are so many direct public controls over unsound competitive practices in the industry refutes the argument that private controls of competition are necessary in the public interest and ought therefore to be immune from scrutiny under the antitrust laws. Cf. Kaysen and Turner, Antitrust Policy (1959), 206.
38
We note, finally, that the doctrine of 'primary jurisdiction' is not applicable here. That doctrine requires judicial abstention in cases where protection of the integrity of a regulatory scheme dictates preliminary resort to the agency which administers the scheme. See Far East Conference v. United States, 342 U.S. 570, 72 S.Ct. 492, 96 L.Ed. 576; Great Northern R. Co. v. Merchants Elevator Co., 259 U.S. 285, 42 S.Ct. 477, 66 L.Ed. 943; Schwartz, Legal Restriction of Competition in the Regulated Industries: An Abdication of Judicial Responsibility, 67 Harv.L.Rev. 436, 464 (1954).31 Court jurisdiction is not thereby ousted, but only postponed. See General Am. Tank Car Corp. v. El Dorado Terminal Co., 308 U.S. 422, 433, 60 S.Ct. 325, 331, 84 L.Ed. 361; Federal Maritime Bd. v. Isbrandtsen Co., 356 U.S. 481, 498—499, 78 S.Ct. 851, 861—862, 2 L.Ed.2d 926; 3 Davis, Administrative Law (1958), 1 55. Thus, even if we were to assume the applicability of the doctrine to merger-application proceedings before the banking agencies,32 the present action would not be barred, for the agency proceeding was completed before the antitrust action was commenced. Cf. United States v. Western Pac. R. Co., 352 U.S. 59, 69, 77 S.Ct. 161, 167—168, 1 L.Ed.2d 126; Retail Clerks Int'l Assn. v. Schermerhorn, 373 U.S. 746, 756, 83 S.Ct. 1461, 1467. We recognize that the practical effect of applying the doctrine of primary jurisdiction has sometimes been to channel judicial enforcement of antitrust policy into appellate review of the agency's decision, see Federal Maritime Bd. v. Isbrandtsen Co., supra; cf. D. L. Piazza Co. v. West Coast Line, Inc., 210 F.2d 947 (C.A.2d Cir., 1954), or even to preclude such enforcement entirely if the agency has the power to approve the challenged activities, see United States Nav. Co. v. Cunard S.S. Co., 284 U.S. 474, 52 S.Ct. 247, 76 L.Ed. 408; cf. United States v. Railway Express Agency, 101 F.Supp. 1008 (D.C.D.Del.1951); but see Federal Maritime Bd. v. Isbrandtsen Co., supra. But here there may be no power of judicial review of the administrative decision approving the merger, and such approval does not in any event confer immunity from the antitrust laws, see pp. 350—352, supra. Furthermore, the considerations that militate against finding a repeal of the antitrust laws by implication from the existence of a regulatory scheme also argue persuasively against attenuating, by postponing, the courts' jurisdiction to enforce those laws.
39
It should be unnecessary to add that in holding as we do that the Bank Merger Act of 1960 does not preclude application of § 7 of the Clayton Act to bank mergers, we deprive the later statute of none of its intended force. Congress plainly did not intend the 1960 Act to extinguish other sources of federal restraint of bank acquisitions having anticompetitive effects. For example, Congress certainly knew that bank mergers would continue subject to the Sherman Act, see p. 352, supra, as well as that pure stock acquisitions by banks would continue subject to § 7 of the Clayton Act. If, in addition, bank mergers are subject to § 7, we do not see how the objectives of the 1960 Act are thereby thwarted. It is not as if the Clayton and Sherman Acts embodied approaches to antitrust policy inconsistent with or unrelated to each other. The Sherman Act, of course, forbids mergers effecting an unreasonable restraint of trade. See, e.g., Northern Securities Co. v. United States, 193 U.S. 197, 24 S.Ct. 436, 48 L.Ed. 679; United States v. Union Pac. R. Co., 226 U.S. 61, 33 S.Ct. 53, 57 L.Ed. 124; indeed, there is presently pending before this Court a challenge to a bank merger predicated solely on the Sherman Act. United States v. First Nat. Bank & Trust Co. of Lexington, 374 U.S. 824, 83 S.Ct. 1864. And the tests of illegality under the Sherman and Clayton Acts are complementary. '(T)he public policy announced by § 7 of the Clayton Act is to be taken into consideration in determining whether acquisition of assets * * * violates the prohibitions of the Sherman Act against unreasonable restraints.' United States v. Columbia Steel Co., 334 U.S. 495, 507, n. 7, 68 S.Ct. 1107, 1114, 92 L.Ed. 1533; see Note, 52 Col.L.Rev. 766, 768, n. 10 (1952). To be sure, not every violation of § 7, as amended, would necessarily be a violation of the Sherman Act; our point is simply that since Congress passed the 1960 Act with no intention of displacing the enforcement of the Sherman Act against bank mergers—or even of § 7 against pure stock acquisitions by banks—continued application of § 7 to bank mergers cannot be repugnant to the design of the 1960 Act. It would be anomalous to conclude that Congress, while intending the Sherman Act to remain fully applicable to bank mergers, and § 7 of the Clayton Act to remain fully applicable to pure stock acquisitions by banks, nevertheless intended § 7 to be completely inapplicable to bank mergers.
40
III. THE LAWFULNESS OF THE PROPOSED MERGER UNDER SECTION 7.
41
The statutory test is whether the effect of the merger 'may be substantially to lessen competition' 'in any line of commerce in any section of the country.' We analyzed the test in detail in Brown Shoe Co. v. United States, 370 U.S. 294, 82 S.Ct. 1502, 8 L.Ed.2d 510, and that analysis need not be repeated or extended here, for the instant case presents only a straightforward problem of application to particular facts.
42
We have no difficulty in determining the 'line of commerce' (relevant product or services market) and 'section of the country' (relevant geographical market) in which to appraise the probable competitive effects of appellees' proposed merger. We agree with the District Court that the cluster of products (various kinds of credit) and services (such as checking accounts and trust administration) denoted by the term 'commercial banking,' see note 5, supra, composes a distinct line of commerce. Some commercial banking products or services are so distinctive that they are entirely free of effective competition from products or services of other financial institutions; the checking account is in this category. Others enjoy such cost advantages as to be insulated within a broad range from substitutes furnished by other institutions. For example, commercial banks compete with small-loan companies in the personal-loan market; but the small-loan companies' rates are invariably much higher than the banks', in part, it seems, because the companies' working capital consists in substantial part of bank loans.33 Finally, there are banking facilities which, although in terms of cost and price they are freely competitive with the facilities provided by other financial institutions, nevertheless enjoy a settled consumer preference, insulating them, to a marked degree, from competition; this seems to be the case with savings deposits.34 In sum, it is clear that commercial banking is a market 'sufficiently inclusive to be meaningful in terms of trade realities.' Crown Zellerbach Corp. v. Federal Trade Comm'n, 296 F.2d 800, 811 (C.A.9th Cir., 1961).
43
We part company with the District Court on the determination of the appropriate 'section of the country.' The proper question to be asked in this case is not where the parties to the merger do business or even where they compete, but where, within the area of competitive overlap, the effect of the merger on competition will be direct and immediate. See Bock, Mergers and Markets (1960), 42. This depends upon 'the geographic structure of supplier-customer relations.' Kaysen and Turner, Antitrust Policy (1959), 102. In banking, as in most service industries, convenience of location is essential to effective competition. Individuals and corporations typically confer the bulk of their patronage on banks in their local community; they find it impractical to conduct their banking business at a distance.35 See Transamerica Corp. v. Board of Govs. of Fed. Res. Sys., 206 F.2d 163, 169 (C.A.3d Cir., 1953). The factor of inconvenience localizes banking competition as effectively as high transportation costs in other industries. See, eG., American Crystal Sugar Co. v. Cuban-American Sugar Co., 152 F.Supp. 387, 398 (D.C.S.D.N.Y.1957), aff'd, 259 F.2d 524 (C.A.2d Cir., 1958). Therefore, since, as we recently said in a related context, the 'area of effective competition in the known line of commerce must be charted by careful selection of the market area in which the seller operates, and to which the purchaser can practicably turn for supplies.' Tampa Elec. Co. v. Nashville Coal Co., 365 U.S. 320, 327, 81 S.Ct. 623, 628, 5 L.Ed.2d 580 (emphasis supplied); see Standard Oil Co. of Cal. & Standard Stations v. United States, 337 U.S. 293, 299 and 300, n. 5, 69 S.Ct. 1051, 1055—1056, 93 L.Ed. 1371, the four-county area in which appellees' offices are located would seem to be the relevant geographical market. Cf. Brown Shoe Co., supra, 370 U.S., at 338—339, 82 S.Ct., at 1531 1532, 8 L.Ed.2d 510. In fact, the vast bulk of appellees' business originates in the four-county area.36 Theoretically, we should be concerned with the possibility that bank offices on the perimeter of the area may be in effective competition with bank offices within; actually, this seems to be a factor of little significance.37
44
We recognize that the area in which appellees have their offices does not delineate with perfect accuracy an appropriate 'section of the country' in which to appraise the effect of the merger upon competition. Large borrowers and large depositors, the record shows, may find it practical to do a large part of their banking business outside their home community; very small borrowers and depositors may, as a practical matter, be confined to bank offices in their immediate neighborhood; and customers of intermediate size, it would appear, deal with banks within an area intermediate between these extremes. See notes 35—37, supra. So also, some banking services are evidently more local in nature than others. But that in banking the relevant geographical market is a function of each separate customer's economic scale means simply that a workable compromise must be found: some fair intermediate delineation which avoids the indefensible extremes of drawing the market either so expansively as to make the effect of the merger upon competition seem insignificant, because only the very largest bank customers are taken into account in defining the market, or so narrowly as to place appellees in different markets, because only the smallest customers are considered. We think that the four-County Philadelphia metropolitan area, which state law apparently recognizes as a meaningful banking community in allowing Philadelphia banks to branch within it, and which would seem roughly to delineate the area in which bank customers that are neither very large nor very small find it practical to do their banking business, is a more appropriate 'section of the country' in which to appraise the instant merger than any larger or smaller or different area. Cf. Hale and Hale, Market Power: Size and Shape Under the Sherman Act (1958), 119. We are helped to this conclusion by the fact that the three federal banking agencies regard the area in which banks have their offices as an 'area of effective competition.' Not only did the FDIC and FRB, in the reports they submitted to the Comptroller of the Currency in connection with appellees' application for permission to merge, so hold, but the Comptroller, in his statement approving the merger, agreed: 'With respect to the effect upon competition, there are three separate levels and effective areas of competition involved. These are the national level for national accounts, the regional or sectional area, and the local area of the City of Philadelphia and the immediately surrounding area.'
45
Having determined the relevant market, we come to the ultimate question under § 7: whether the effect of the merger 'may be substantially to lessen competition' in the relevant market. Clearly, this is not the kind of question which is susceptible of a ready and precise answer in most cases. It requires not merely an appraisal of the immediate impact of the merger upon competition, but a prediction of its impact upon competitive conditions in the future; this is what is meant when it is said that the amended § 7 was intended to arrest anticompetitive tendencies in their 'incipiency.' See Brown Shoe Co., supra, 370 U.S., at 317, 322, 82 S.Ct., at 1519—1520, 1522, 8 L.Ed.2d 510. Such a prediction is sound only if it is based upon a firm understanding of the structure of the relevant market; yet the relevant economic data are both complex and elusive. See generally Bok, Section 7 of the Clayton Act and the Merging of Law and Economics, 74 Harv.L.Rev. 226 (1960). And unless businessmen can assess the legal consequences of a merger with some confidence, sound business planning is retarded. See Crown Zellerbach Corp. v. Federal Trade Comm'n, 296 F.2d 800, 826—827 (C.A.9th Cir., 1961). So also, we must be alert to the danger of subverting congressional intent by permitting a too-broad economic investigation. Standard Oil Co. of Cal. & Standard Stations v. United States, 337 U.S. 293, 313, 69 S.Ct. 1051, 1062, 93 L.Ed. 1371. And so in any case in which it is possible, without doing violence to the congressional objective embodied in § 7, to simplify the test of illegality, the courts ought to do so in the interest of sound and practical judicial administration. See Union Carbide Corp., Trade Reg. Rep., FTC Complaints and Orders, 1961 1963, 15503, at 20375—20376 (concurring opinion). This is such a case.
46
We noted in Brown Shoe Co., supra, 370 U.S., at 315, 82 S.Ct., at 1518, 8 L.Ed.2d 510, that '(t)he dominant theme pervading congressional consideration of the 1950 amendments (to § 7) was a fear of what was considered to be a rising tide of economic concentration in the American economy.' This intense congressional concern with the trend toward concentration warrants dispensing, in certain cases, with elaborate proof of market structure, market behavior, or probable anticompetitive effects. Specifically, we think that a merger which produces a firm controlling an undue percentage share of the relevant market, and results in a significant increase in the concentration of firms in that market is so inherently likely to lessen competition substantially that it must be enjoined in the absence of evidence clearly showing that the merger is not likely to have such anticompetitive effects. See United States v. Koppers Co., 202 F.Supp. 437 (D.C.W.D.Pa.1962).
47
Such a test lightens the burden of proving illegality only with respect to mergers whose size makes them inherently suspect in light of Congress' design in § 7 to prevent undue concentration. Furthermore, the test is fully consonant with economic theory.38 That '(c)ompetition is likely to be greatest when there are many sellers, none of which has any significant market share,'39 is common ground among most economists, and was undoubtedly a premise of congressional reasoning about the antimerger statute.
48
The merger of appellees will result in a single bank's controlling at least 30% of the commercial banking business in the four-county Philadelphia metropolitan area.40 Without attempting to specify the smallest market share which would still be considered to threaten undue concentration, we are clear that 30% presents that threat.41 Further, whereas presently the two largest banks in the area (First Pennsylvania and PNB) control between them approximately 44% of the area's commercial banking business, the two largest after the merger (PNB-Girard and First Pennsylvania) will control 59%. Plainly, we think, this increase of more than 33% in concentration must be regarded as significant.42
49
Our conclusion that these percentages raise an inference that the effect of the contemplated merger of appellees may be substantially to lessen competition is not an arbitrary one, although neither the terms of § 7 nor the legislative history suggests that any particular percentage share was deemed critical. The House Report states that the tests of illegality under amended § 7 'are intended to be similar to those which the courts have applied in interpreting the same language as used in other sections of the Clayton Act.' H.R.Rep.No.1191, 81st Cong., 1st Sess. 8. Accordingly, we have relied upon decisions under these other sections in applying § 7. See Brown Shoe Co., supra, passim; cf. United States v. E. I. Du Pont De Nemours & Co., 353 U.S. 586, 595, and n. 15, 77 S.Ct. 872, 878, 1 L.Ed.2d 1057. In Standard Oil Co. of Cal. & Standard Stations v. United States, 337 U.S. 293, 69 S.Ct. 1051, 93 L.Ed. 1371, cited in S.Rep.No.1775, 81st Cong., 2d Sess. 6, this Court held violative of § 3 of the Clayton Act exclusive contracts whereby the defendant company, which accounted for 23% of the sales in the relevant market and, together with six other firms, accounted for 65% of such sales, maintained control over outlets through which approximately 7% of the sales were made. In Federal Trade Comm'n v. Motion Picture Adv. Serv. Co., 344 U.S. 392, 73 S.Ct. 361, 97 L.Ed. 426, we held unlawful, under § 1 of the Sherman Act and § 5 of the Federal Trade Commission Act, rather than under § 3 of the Clayton Act, exclusive arrangements whereby the four major firms in the industry had foreclosed 75% of the relevant market; the respondent's market share, evidently, was 20%. Kessler and Stern, Competition, Contract, and Vertical Integration, 69 Yale L.J. 1, 53 n. 231 (1959). In the instant case, by way of comparison, the four largest banks after the merger will foreclose 78% of the relevant market. P. 331, supra. And in Standard Fashion Co. v. Magrane-Houston Co., 258 U.S. 346, 42 S.Ct. 360, 66 L.Ed. 653, the Court held violative of § 3 a series of exclusive contracts whereby a single manufacturer controlled 40% of the industry's retail outlets. Doubtless these cases turned to some extent upon whether 'by the nature of the market there is room for newcomers.' Federal Trade Comm'n v. Motion Picture Adv. Serv. Co., supra, 344 U.S., at 395, 73 S.Ct., at 363, 97 L.Ed. 426. But they remain highly suggestive in the present context, for as we noted in Brown Shoe Co., supra, 370 U.S., at 332, n. 55, 82 S.Ct., at 1522, 8 L.Ed.2d 510, integration by merger is more suspect than integration by contract, because of the greater permanence of the former. The market share and market concentration figures in the contract-integration cases, taken together with scholarly opinion, see notes 41 and 42, supra, support, we believe, the inference we draw in the instant case from the figures disclosed by the record.
50
There is nothing in the record of this case to rebut the inherently anticompetitive tendency manifested by these percentages. There was, to be sure, testimony by bank officers to the effect that competition among banks in Philadelphia was vigorous and would continue to be vigorous after the merger. We think, however, that the District Court's reliance on such evidence was misplaced. This lay evidence on so complex an economic-legal problem as the substantiality of the effect of this merger upon competition was entitled to little weight, in view of the witnesses' failure to give concrete reasons for their conclusions.43
51
Of equally little value, we think, are the assurances offered by appellees' witnesses that customers dissatisfied with the services of the resulting bank may readily turn to the 40 other banks in the Philadelphia area. In every case short of outright monopoly, the disgruntled customer has alternatives; even in tightly oligopolistic markets, there may be small firms operating. A fundamental purpose of amending § 7 was to arrest the trend toward concentration, the tendency to monopoly, before the consumer's alternatives disappeared through merger, and that purpose would be ill-served if the law stayed its hand until 10, or 20, or 30 more Philadelphia banks were absorbed. This is not a fanciful eventuality, in view of the strong trend toward mergers evident in the area, see p. 331, supra; and we might note also that entry of new competitors into the banking field is far from easy.44
52
So also, we reject the position that commercial banking, because it is subject to a high degree of governmental regulation, or because it deals in the intangibles of credit and services rather than in the manufacture or sale of tangible commodities, is somehow immune from the anticompetitive effects of undue concentration. Competition among banks exists at every level price, variety of credit arrangements, convenience of location, attractiveness of physical surroundings, credit information, investment advice, service charges, personal accommodations, advertising, miscellaneous special and extra services—and it is keen; on this appellees' own witnesses were emphatic.45 There is no reason to think that concentration is less inimical to the free play of competition in banking than in other service industries. On the contrary, it is in all probability more inimical. For example, banks compete to fill the credit needs of businessmen. Small businessman especially are, as a practical matter, confined to their locality for the satisfaction of their credit needs. See note 35, supra. If the number of banks in the locality is reduced, the vigor of competition for filling the marginal small business borrower's needs is likely to diminish. At the same time, his concomitantly greater difficulty in obtaining credit is likely to put him at a disadvantage vis-a -vis larger businesses with which he competes. In this fashion, concentration in banking accelerates concentration generally.
53
We turn now to three affirmative justifications which appellees offer for the proposed merger. The first is that only through mergers can banks follow their customers to the suburbs and retain their business. This justification does not seem particularly related to the instant merger, but in any event it has no merit. There is an alternative to the merger route: the opening of new branches in the areas to which the customers have moved—so-called de novo branching. Appellees do not contend that they are unable to expand thus, by opening new offices rather than acquiring existing ones, and surely one premise of an antimerger statute such as § 7 is that corporate growth by internal expansion is socially preferable to growth by acquisition.
54
Second, it is suggested that the increased lending limit of the resulting bank will enable it to compete with the large out-of-state bank, particularly the New York banks, for very large loans. We reject this application of the concept of 'countervailing power.' Cf. Kiefer-Stewart Co. v. Joseph E. Seagram & Sons, 340 U.S. 211, 71 S.Ct. 259, 95 L.Ed. 219. If anticompetitive effects in one market could be justified by procompetitive consequences in another, the logical upshot would be that every firm in an industry could, without violating § 7, embark on a series of mergers that would make it in the end as large as the industry leader. For if all the commercial banks in the Philadelphia area merged into one, it would be smaller than the largest bank in New York City. This is not a case, plainly, where two small firms in a market propose to merge in order to be able to compete more successfully with the leading firms in that market. Nor is it a case in which lack of adequate banking facilities is causing hardships to individuals or businesses in the community. The present two largest banks in Philadelphia have lending limits of $8,000,000 each. The only business located in the Philadelphia area which find such limits inadequate are large enough readily to obtain bank credit in other cities.
55
This brings us to appellees' final contention, that Philadelphia needs a bank larger than it now has in order to bring business to the area and stimulate its economic development. See p. 334 and note 10, supra. We are clear, however, that a merger the effect of which 'may be substantially to lessen competition' is not saved because, on some ultimate reckoning of social or economic debits and credits, it may be deemed beneficial. A value choice of such magnitude is beyond the ordinary limits of judicial competence, and in any event has been made for us already, by Congress when it enacted the amended § 7. Congress determined to preserve our traditionally competitive economy. It therefore proscribed anticompetitive mergers, the benign and the malignant alike, fully aware, we must assume, that some price might have to be paid.
56
In holding as we do that the merger of appellees would violate § 7 and must therefore be enjoined, we rejct appellees' pervasive suggestion that application of the procompetitive policy of § 7 to the banking industry will have dire, although unspecified, consequences for the national economy. Concededly, PNB and Girard are healthy and strong; they are not undercapitalized or overloaned; they have no management problems; the Philadelphia area is not overbanked; ruinous competition is not in the offing. Section 7 does not mandate cutthroat competition in the banking industry, and does not exclude defenses based on dangers to liquidity or solvency, if to avert them a merger is necessary.46 It does require, however, that the forces of competition be allowed to operate within the broad framework of governmental regulation of the industry. The fact that banking is a highly regulated industry critical to the Nation's welfare markes the play of competition not less important but more so. At the price of some repetition, we note that if the businessman is denied credit because his banking alternatives have been eliminated by mergers, the whole edifice of an entrepreneurial system is threatened; if the costs of banking services and credit are allowed to become excessive by the absence of competitive pressures, virtually all costs, in our credit economy, will be affected; and unless competition is allowed to fulfill its role as an economic regulator in the banking industry, the result may well be even more governmental regulation. Subject to narrow qualifications, it is surely the case that competition is our fundamental national economic policy, offering as it does the only alternative to the cartelization or governmental regimentation of large portions of the economy. Cf. Northern Pac. R. Co. v. United States, 356 U.S. 1, 4, 78 S.Ct. 514, 517—518, 2 L.Ed.2d 545. There is no warrant for declining to enforce it in the instant case.
57
The judgment of the District Court is reversed and the case remanded with direction to enter judgment enjoining the proposed merger. It is so ordered.
58
Reversed and remanded with direction.
59
Mr. Justice WHITE took no part in the consideration or decision of this case.
60
Mr. Justice HARLAN, whom Mr. Justice STEWART joins, dissenting.
61
I suspect that no one will be more surprised than the Government to find that the Clayton Act has carried the day for its case in this Court.
62
In response to an apparently accelerating trend toward concentration in the commercial banking system in this country, a trend which existing laws were evidently ill-suited to control, numerous bills were introduced in Congress from 1955 to 1960.1 During this period, the Department of Justice and the federal banking agencies2 advocated divergent methods of dealing with the competitive aspects of bank mergers, the former urging the extension of § 7 of the Clayton Act to cover such mergers and the latter supporting a regulatory scheme under which the effect of a bank merger on competition would be only one of the factors to be considered in determining whether the merger would be in the public interest. The Justice Department's proposals were repeatedly rejected by Congress, and the regulatory approach of the banking agencies was adopted in the Bank Merger Act of 1960. See infra, pp. 379—383.
63
Sweeping aside the 'design fashioned in the Bank Merger Act' as 'predicated upon uncertainty as to the scope of § 7' of the Clayton Act (ante, p. 349), the Court today holds § 7 to be applicable to bank mergers and concludes that it has been violated in this case. I respectfully submit that this holding, which sanctions a remedy regarded by Congress as inimical to the best interests of the banking industry and the public, and which will in large measure serve to frustrate the objectives of the Bank Merger Act, finds no justification in either the terms of the 1950 amendment of the Clayton Act or the history of the statute.
I.
64
The key to this case is found in the special position occupied by commercial banking in the economy of this country. With respect to both the nature of the operations performed and the degree of governmental supervision involved, it is fundamentally different from ordinary manufacturing and mercantile businesses.
65
The unique powers of commercial banks to accept demand deposits, provide checking account services, and lend against fractional reserves permit the banking system as a whole to create a supply of 'money,' a function which is indispensable to the maintenance of the structure of our national economy. And the amount of the funds held by commercial banks is very large indeed; demand deposits alone represent approximately three-fourths of the money supply in the United States.3 Since a bank's assets must be sufficiently liquid to accommodate demand withdrawals, short-term commercial and industrial loans are the major element in bank portfolios, thus making commercial banks the principal source of short-term business credit. Many other services are also provided by banks, but in these more or less collateral areas they receive more active competition from other financial institutions.4
66
Deposit banking operations affect not only the volume of money and credit, but also the value of the dollar and the stability of the currency system. In this field, considerations other than simply the preservation of competition are relevant. Moreover, commercial banks are entrusted with the safekeeping of large amounts of funds belonging to individuals and corporations. Unlike the ordinary investor, these depositors do not regard their funds as subject to a risk of loss and, at least in the case of demand depositors, they do not receive a return for taking such a risk. A bank failure is a community disaster; its impact first strikes the bank's depositors most heavily, and then spreads throughout the economic life of the community.5 Safety and soundness of banking practices are thus critical factors in any banking system.
67
The extensive blanket of state and federal regulation of commercial banking, much of which is aimed at limiting competition, reflects these factors. Since the Court's opinion describes, at some length, aspects of the supervision exercised by the federal banking agencies (ante, pp. 327—330), I do no more here than point out that, in my opinion, such regulation evidences a plain design grounded on solid economic considerations to deal with banking as a specialized field.
68
This view is confirmed by the Bank Merger Act of 1960 and its history.
69
Federal legislation dealing with bank mergers6 dates from 1918, when Congress provided that, subject to the approval of the Comptroller of the Currency, two or more national banks could consolidate to form a new national bank;7 similar provision was made in 1927 for the consolidation of a state and a national bank resulting in a national bank.8 In 1952 mergers of national and state banks into national banks were authorized, also conditioned on approval by the Comptroller of the Currency.9 In 1950 Congress authorized the theretofore prohibited10 merger or consolidation of a national bank with a state bank when the assuming or resulting bank would be a state bank.11 In addition, the Federal Deposit Insurance Act was amended to require the approval of the FDIC for all mergers and consolidations between insured and noninsured banks, and of specified federal banking agencies for conversions of insured banks into insured state banks if the conversion would result in the capital stock or surplus of the newly formed bank being less than that of the converting bank.12 The Act further required insured banks merging with insured state banks to secure the approval of the Comptroller of the Currency if the assuming bank would be a national bank, and the approval of the Board of Governors of the Federal Reserve System and the FDIC, respectively, if the assuming or resulting bank would be a state member bank or nonmember insured bank.13
70
None of this legislation prescribed standards by which the appropriate federal banking agencies were to be guided in determining the significance to be attributed to the anticompetitive effects of a proposed merger. As previously noted (supra, p. 373), Congress became increasingly concerned with this problem in the 1950's. The antitrust laws apparently provided no solution; in only one case prior to 1960, United States v. First-america Corp., Civil No. 38139, N.D.Cal., March 30, 1959, settled by consent decree, had either theSherman or Clayton Act been invoked to attack a commercial bank merger.
71
Indeed the inapplicability to bank mergers of § 7 of the Clayton Act, even after it was amended in 1950, was, for a time, an explicit premise on which the Department of Justice performed its antitrust duties. In passing upon an application for informal clearance of a bank merger in 1955, the Department stated:
72
'After a complete consideration of this matter, we have concluded that this Department would not have jurisdiction to proceed under section 7 of the Clayton Act. For this reason this Department does not presently plan to take any action on this matter.' Hearings before the Antitrust Subcommittee of the House Committee on the Judiciary, 84th Cong., 1st Sess., Ser. 3, pt. 3, p. 2141 (1955).
73
And in testifying before the Senate Committee on Banking and Currency in 1957 Attorney General Brownell, speaking of bank mergers, noted:
74
'On the basis of these provisions the Department of Justice has concluded, and all apparently agree, that asset acquisitions by banks are not covered by section 7 (of the Clayton Act) as amended in 1950.' Hearings on the Financial Institutions Act of 1957 before a Subcommittee of the Senate Committee on Banking and Currency, 85th Cong., 1st Sess., pt. 2, p. 1030 (1957).
75
Similar statements were repeatedly made to Congress by Justice Department representatives in the years prior to the enactment of the Bank Merger Act.14
76
The inapplicability of § 7 to bank mergers was also an explicit basis on which Congress acted in passing the Bank Merger Act of 1960. The Senate Report on S. 1062, the bill that was finally enacted, stated:
77
'Since bank mergers are customarily, if not invariably, carried out by asset acquisitions, they are exempt from section 7 of the Clayton Act. (Stock acquisitions by bank holding companies, as distinguished from mergers and consolidations, are subject to both the Bank Holding Company Act of 1956 and sec. 7 of the Clayton Act.)' S.Rep. No. 196, 86th Cong., 1st Sess. 1—2 (1959).
78
'In 1950 (64 Stat. 1125) section 7 of the Clayton Act was amended to correct these deficiencies. Acquisitions of assets were included within the section, in addition to stock acquisitions, but only in the case of corporations subject to the jurisdiction of the Federal Trade Commission (banks, being subject to the jurisdiction of the Federal Reserve Board for purposes of the Clayton Act by virtue of section 11 of that act, were not affected).' Id., at 5.15
79
During the floor debates Representative Spence, the Chairman of the House Committee on Banking and Currency, recognized the same difficulty: 'The Clayton Act is ineffective as to bank mergers because in the case of banks it covers only stock acquisitions and bank mergers are not accomplished that way.' 106 Cong.Rec. 7257 (1960).16
80
But instead of extending the scope of § 7 to cover bank mergers, as numerous proposed amendments to that section were designed to accomplish,17 Congress made the deliberate policy judgment that 'it is impossible to subject bank mergers to the simple rule of section 7 of the Clayton Act. Under that act, a merger would be barred if it might tend substantially to lessen competition, regardless of the effects on the public interest.' 105 Cong.Rec. 8076 (1959) (remarks of Senator Robertson, a sponsor of S. 1062). Because of the peculiar nature of the commercial banking industry, its crucial role in the economy, and its intimate connection with the fiscal and monetary operations of the Government, Congress rejected the notion that the general economic and business premises of the Clayton Act should be the only considerations applicable to this field. Unrestricted bank competition was thought to have been a major cause of the panic of 1907 and of the bank failures of the 1930's,18 and was regarded as a highly undesirable condition to impose on banks in the future: 'The antitrust laws have reflected an awareness of the difference between banking and other regulated industries on the one hand, and ordinary unregulated industries and commercial enterprises on the other hand.' 106 Cong.Rec. 9711 (1960) (remarks of Senator Fulbright, a sponsor of S. 1062).
81
'It is this distinction between banking and other businesses which justifies different treatment for bank mergers and other mergers. It was this distinction that led the Senate to reject the flat prohibition of the Clayton Act test which applies to other mergers.' Id., at 9712.19
82
Thus the Committee on Banking and Currency recommended 'continuance of the existing exemption from section 7 of the Clayton Act.' 105 Cong.Rec. 8076 (1959). Congress accepted this recommendation; it decided to handle the problem of concentration in commercial banking 'through banking laws, specially framed to fit the particular needs of the field * * *.' S.Rep. No. 196, 86th Cong., 1st Sess. 18 (1959). As finally enacted in 1960, (the Bank Merger Act embodies the regulatory approach advocated by the banking agencies, vesting in them responsibility for its administration and placing the scheme within the framework of existing banking laws as an amendment to § 18(c) of the Federal Deposit Insurance Act, 12 U.S.C. (Supp. IV, 1963), § 1828(c).20 It maintains the latter Act's requirement of advance approval by the appropriate federal agency for mergers between insured banks and between insured and noninsured banks (supra, pp. 375—377), but establishes that such approval is necessary in every merger of this type. To aid the respective agencies in determining whether to approve a merger, and in 'the interests of uniform standards' (12 U.S.C. (Supp. IV, 1963) § 1828(c)), the Act requires the two agencies not making the particular decision and the Attorney General to submit to the immediately responsible agency reports on the competitive factors involved. It further provides that in addition to considering the banking factors examined by the FDIC in connection with applications to become an insured bank, which focus primarily on matters of safety and soundness,21 the approving agency 'shall also take into consideration the effect of the transaction on competition (including any tendency toward monopoly), and shall not approve the transaction unless, after considering all of such factors, it finds the transaction to be in the public interest.' 12 U.S.C. (Supp. IV, 1963) § 1828(c).
83
The congressional purpose clearly emerges from the terms of the statute and from the committee reports, hearings, and floor debates on the bills. Time and again it was repeated that effect on competition was not to be the controlling factor in determining whether to approve a bank merger, that a merger could be approved as being in the public interest even though it would cause a substantial lessening of competition. The folowing statement is typical:
84
'The committee wants to make crystal clear its intention that the various banking factors in any particular case may be held to outweigh the competitive factors, and that the competitive factors, however favorable or unfavorable, are not, in and of themselves, controlling on the decision. And, of course, the banking agencies are not bound in their consideration of the competitive factors by the report of the Attorney General.' S.Rep. No. 196, 86th Cong., 1st Sess. 24 (1959); id., at 19, 21.22
85
The foregoing statement also shows that it was the congressional intention to place the responsibility for approval squarely on the banking agencies; the report of the Attorney General on the competitive aspects of a merger was to be advisory only.23 And there was deliberately omitted any attempt to specify or restrict the kinds of circumstances in which the agencies might properly determine that a proposed merger would be in the public interest notwithstanding its adverse effect on competition.24
86
What Congress has chosen to do about mergers and their effect on competition in the highly specialized field of commercial banking could not be more 'crystal clear.' (Supra, p. 382.) But in the face of overwhelming evidence to the contrary, the Court, with perfect equanimity, finds 'uncertainty' in the foundations of the Bank Merger Act (ante, p. 349) and on this premise puts it aside as irrelevant to the task of construing the scope of § 7 of the Clayton Act.
87
I am unable to conceive of a more inappropriate case in which to overturn the considered opinion of all concerned as to the reach of prior legislation.25 For 10 years everyone—the department responsible for antitrust law enforcement, the banking industry, the Congress, and the bar proceeded on the assumption that the 1950 amendment of the Clayton Act did not affect bank mergers. This assumption provided a major impetus to the enactment of remedial legislation, and Congress, when it finally settled on what it thought was the solution to the problem at hand, emphatically rejected the remedy now brought to life by the Court.
88
The result is, of course, that the Bank Merger Act is almost completely nullified; its enactment turns out to have been an exorbitant waste of congressional time and energy. As the present case illustrates, the Attorney General's report to the designated banking agency is no longer truly advisory, for if the agency's decision is not satisfactory a § 7 suit may be commenced immediately.26 The bank merger's legality will then be judged solely from its competitive aspects, unencumbered by any considerations peculiar to banking.27 And if such a suit were deemed to lie after a bank merger has been consummated, there would then be introduced into this field, for the first time to any significant extent, the threat of divestiture of assets and all the complexities and disruption attendant upon the use of that sanction.28 The only vestige of the Bank Merger Act which remains is that the banking agencies will have an initial veto.29
89
This frustration of a manifest congressional design is, in my view, a most unwarranted intrusion upon the legislative domain. I submit that whatever may have been the congressional purpose in 1950, Congress has now so plainly pronounced its current judgment that bank mergers are not within the reach of § 7 that this Court is duty bound to effectuate its choice.
90
But I need not rest on this proposition, for, as will now be shown, there is nothing in the 1950 amendment to § 7 or its legislative history to support the conclusion that Congress even then intended to subject bank mergers to this provision of the Clayton Act.
II.
91
Prior to 1950, § 7 of the Clayton Act read, in pertinent part, as follows:
92
'That no corporation engaged in commerce shall acquire, directly or indirectly, the whole or any part of the stock or other share capital of another corporation engaged also in commerce, where the effect of such acquisition may be to substantially lessen competition between the corporation whose stock is so acquired and the corporation making the acquisition, or to restrain such commerce in any section or community, or tend to create a monopoly of any line of commerce.'
93
In 1950 this section was amended to read (the major amendments being indicated in italics):
94
'That no corporation engaged in commerce shall acquire, directly or indirectly, the whole or any part of the stock or other share capital and no corporation subject to the jurisdiction of the Federal Trade Commission shall acquire the whole or any part of the assets of another corporation engaged also in commerce, where in any line of commerce in any section of the country, the effect of such acquisition may be substantially to lessen competition, or to tend to create a monopoly.'
95
If Congress did intend the 1950 amendment to reach bank mergers, it certainly went at the matter in a very peculiar way. While prohibiting asset acquisitions having the anticompetitive effects described in § 7, it limited the applicability of that provision to corporations subject to the jurisdiction of the Federal Trade Commission, which does not include banks. And it reenacted the stock-acquisition provision in the very same language which—as it was fully aware—had been interpreted not to reach the type of merger customarily used in the banking industry. See infra, pp. 389—393. In the past this Court has drawn the normal inference that such a reenactment indicates congressional adoption of the prior judicial statutory construction. E.g., United States v. Dixon, 347 U.S. 381, 74 S.Ct. 566, 98 L.Ed. 785; Overstreet v. North Shore Corp., 318 U.S. 125, 131—132, 63 S.Ct. 494, 498—499, 87 L.Ed. 656.
96
In this instance, however, the Court holds that the stock-acquisition provision underwent an expansive metamorphosis, so that it now embraces all mergers or consolidations involving an exchange of stock. Since bank mergers usually, if not always, do involve exchanges of stock, the effect of this construction is to rob the Federal Trade Commission provision relating to asset acquisitions of all force as a substantive limitation upon the scope of § 7; according to the Court the purpose of that provision was merely to ensure the Commission's role in the enforcement of § 7. Ante, pp. 346—348. In short, under this reasoning bank mergers to all intents and purposes are fully within the reach of § 7.
97
A more circumspect look at the 1950 amendment of § 7 and its background will show that this construction is not tenable.
98
The language of the stock-acquisition provision itself is hardly congenial to the Court's interpretation. The PNB-Girard merger is technically a consolidation, governed by § 20 of the national banking laws, 12 U.S.C. (Supp. IV, 1963) § 215. Under that section, the corporate existence of both PNB and Girard, all of their rights, franchises, assets, and liabilities, would be automatically vested in the resulting bank, which would operate under the PNB charter. PNB itself would acquire nothing. Rather, the two banks would be creating a new entity by the amalgamation of their properties, and the subsequent conversion of Girard stock (which would then represent ownership in a nonfunctioning entity) into stock of the resulting bank would simply be part of the mechanics by which ownership in the new entity would be reflected. Clearly this is not a case of a corporation acquiring the stock of another functioning corporation, which is the only situation where 'the effect of * * * (a stock) acquisition may be substantially to lessen competition.' (Emphasis added.) There are further crucial differences between a merger and a stock acquisition. A merger normally requires public notice and the approval of the holders of two-thirds of the outstanding shares of each corporation, and dissenting shareholders have the right to receive in cash the appraised value of their shares.30 A purchase of stock may be done privately, and the only approval involved is that of the individual parties to the transaction. Unlike a merged company, a corporation whose stock is acquired usually remains in business as a subsidiary of the acquiring corporation.31
99
The Government, however, contends that a merger more closely resembles a stock acquisition than an asset acquisition because of one similarity of central importance: the acquisition by one corporation of an immediate voice in the management of the business of another corporation. But this is obviously true a fortiori of asset acquisitions of sufficient magnitude to fall within the prohibition of § 7; if a corporation buys the plants, equipment, inventory, etc., of another corporation, it acquires absolute control over, not merely a voice in the management of, another business.
100
The legislative history of the 1950 amendment also unquestionably negates any inference that Congress intended to reach bank mergers. It is true that the purpose was 'to plug a loophole' in § 7 (95 Cong.Rec. 11485 (1949) (remarks of Representative Celler)). But simply to state this board proposition does not answer the precise questions presented here: what was the nature of the loophole sought to be closed; what were the means chosen to close it?
101
The answer to the latter question is unmistakably indicated by the relationship between the 1950 amendment and previous judicial decisions. In Arrow-Hart & Hegeman Elec. Co. v. Federal Trade Comm'n, 291 U.S. 587, 54 S.Ct. 532, 78 L.Ed. 1007, this Court, by a divided vote, ruled on the scope of the Federal Trade Commission's remedial powers under the original Clayton Act. After the Commission had issued a § 7 complaint against a holding company which had been formed by the stockholders of two manufacturing corporations, steps were taken to avoid the Commission's jurisdiction. Two new holding companies were formed, each acquired all the common stock of one of the manufacturing companies, and each issued its stock directly to the stockholders of the original holding company. This company then dissolved and the two new holding companies and their respective manufacturing subsidiaries merged into one corporation. This Court held that the Commission had no authority, after the merger, to order the resulting corporation to divest itself of assets. An essential part of this holding was that the merger in question, which was technically a consolidation similar to that here planned by PNB and Girard, was not a stock acquisition within the prohibitions of § 7: 'If the merger of the two manufacturing corporations and the combination of their assets was in any respect a violation of any anti-trust law, as to which we express no opinion, it was necessarily a violation of statutory prohibitions other than those found in the Clayton Act.' 291 U.S., at 599, 54 S.Ct., at 537, 78 L.Ed. 1007; see id., 291 U.S., at 595, 54 S.Ct., at 536, 78 L.Ed. 1007.32
102
This decision, along with two others earlier handed down by this Court (Thatcher Mfg. Co. v. Federal Trade Comm'n and Swift & Co. v. Federal Trade Comm'n, decided together with Federal Trade Comm'n v. Western Meat Co., 272 U.S. 554, 47 S.Ct. 175, 71 L.Ed. 405), perhaps provided more of a spur to enactment of the 'assets' amendment to § 7 than any other single factor. These decisions were universally regarded as opening the unfortunate loophole whereby § 7 could be evaded through the use of an asset acquisition. Representative Celler expressed the view of Congress in this fashion:
103
'The result of these decisions has so weakened sections 7 and 11 * * * as to give to the Federal Trade Commission and the Department of Justice merely a paper sword to prevent improper mergers.' 95 Cong.Rec. 11485 (1949).33
104
Since this Court's decisions were cast in terms of the scope of the Federal Trade Commission's jurisdiction, Congress, in amending § 7 so as to close that gap, emphasized its expectation made plain in the committee reports, hearings, and debates—that the Commission would assume the principal role in enforcing the section.34 Implicit here is that no change in the enforcement powers of the other agencies named in § 11 was contemplated.35 Of more importance, the legislative history demonstrates that it was the asset-acquisition provision that was designed to plug the loophole created by Thatcher, Swift, and Arrow. Although Arrow, unlike Thatcher and Swift, involved a consolidation of the same type as the PNB-Girard merger, the members of Congress drew no distinction among these cases, invariably discussing all three of them in the same breath as examples of asset acquisitions.36 Indeed, the House report stated that
105
'the Supreme Court * * * held (in Arrow) that if an acquiring corporation secured title to the physical assets of a corporation whose stock it had acquired before the Federal Trade Commission issues its final order, the Commission lacks power to direct divestiture of the physical assets * * *.' H.R.Rep.No.1191, 81st Cong., 1st Sess. 5 (1949). (Emphasis added.)
106
And on the Senate floor it was pointed out that 'the method by which * * * (the merger in Arrow) had been accomplished was an innocent one * * *.' 96 Cong.Rec. 16505 (1950). (Emphasis added.) Clearly the understanding of Congress was that a consolidation of two corporations was an acquisition of assets.37
107
Nor did Congress act inadvertently or without purpose in limiting the asset-acquisition provision to corporations subject to the jurisdiction of the Federal Trade Commission, thereby excluding bank mergers. The reports, hearings, and debates on the 1950 amendment reveal that Congress was then concerned with the rising tide of industrial concentration—i.e., 'the external expansion * * * through mergers, acquisitions, and consolidations'38 of corporations engaged in manufacturing, mining, merchandising, and of other kindred commercial endeavors. Specialized areas of the economy such as banking were not even considered. Thus the Federal Trade Commission's 1948 report on mergers recounted the statistics on concentration in a multitude of industries—e.g., steel, cement, electrical equipment, food and dairy products, tobacco, textiles, paper, chemicals, rubber—but included not one figure on banking concentration.39 This report was repeatedly cited and heavily relied on by members of Congress and others to demonstrate the magnitude of the merger movement and the economic dangers it presented.40 In the committee hearings the focus was exclusively upon amalgamation in the ordinary commercial fields,41 and similarly the Senate and House reports spoke solely of industrial concentration as the evil to be remedied.42 On the floor of the House, Representative Celler indicated the extent of concentration of industrial power:
108
'Four companies now have 64 percent of the steel business, four have 82 percent of the copper business, two have 90 percent of the aluminum business, three have 85 percent of the automobile business, two have 80 percent of the electric lamp business, four have 75 percent of the electric refrigerator business, two have 80 percent of the glass business, four have 90 percent of the cigarette business, and so forth.
109
'The antitrust laws are a complete bust unless we pass this bill.' 95 Cong.Rec. 11485 (1949).
110
The legislatory history is thus singularly devoid of any evidence that Congress sought to deal with the special problem of banking concentration.
111
I do not mean to suggest, of course, that § 7 of the Clayton Act is thereby rendered applicable only to ordinary commercial and industrial corporations and not to firms in any 'regulated' sector of the economy. The point is that when Congress included in § 7 asset acquisitions by corporations subject to the Federal Trade Commission's jurisdiction, and at the same time continued in § 11 the Federal Reserve Board's jurisdiction over banks, it was not acting irrationally. Rather, the absence of any mention of banks in the legislative history of the 1950 amendment, viewed in light of the prior congressional treatment of banking as a distinctive area with special characteristics and needs, compels the conclusion that bank mergers were simply not then regarded as part of the loophole to be plugged.43
112
This conclusion is confirmed by a number of additional considerations. It was not until after the passage of the 1950 amendment of § 7 that Representative Celler, its co-sponsor, requested the staff of the Antitrust Subcommittee of the House Committee on the Judiciary 'to prepare a report indicating the concentration existing in our banking system.' Staff of Subcommittee No. 5, House Committee on the Judiciary, 82d Cong., 2d Sess., Report on Bank Mergers and Concentration of Banking Facilities III (1952). The introduction to the report reveals that:
113
'On March 21, 1945, the Board of Governors of the Federal Reserve System wrote to the chairman of the Committee on the Judiciary requesting that the provisions of H.R. 2357, Seventy-ninth Congress, first session, one of the early predecessors of the Celler Antimerger Act, be extended so as to include corporations subject to the jurisdiction of the Federal Reserve Board under section 11 of the Clayton Act. Because of the revisions made in subsequent versions of antimerger bills, however, it became impracticable to include within the scope of the act corporations other than those subject to regulation by the Federal Trade Commission. Banks, which are placed squarely within the authority of the Federal Reserve Board by section 11 of the Clayton Act, are therefore circumscribed insofar as mergers are concerned only by the old provisions of section 7, and certain additional statutes which do not presently concern themselves substantively with the question of competition in the field of banking.' Id., at VII.
114
It is also worth noting that in 1956 Representative Celler himself introduced another amendment to § 7, explaining that 'all the bill (H.R. 5948) does is plug a loophole in the present law dealing with bank mergers. * * * This loophole exists because section 7 of the Clayton Act prohibits bank mergers * * * only if such mergers are accomplished by stock acquisition.' 102 Cong.Rec. 2109 (1956). The bill read in pertinent part: '(N)o bank * * * shall acquire * * * the whole or any part of the assets of another corporation engaged also in commerce * * *.' Ibid. The amendment passed the House but was defeated in the Senate.
115
For all these reasons, I think the conclusion is inescapable that § 7 of the Clayton Act does not apply to the PNB-Girard merger. The Court's contrary conclusion seems to me little better than a tour de force.44
116
Memorandum of Mr. Justice GOLDBERG.
117
I agree fully with my Brother HARLAN that § 7 of the Clayton Act has no application to bank mergers of the type involved here, and I therefore join in the conclusions expressed in his opinion on that point. However, while I thus dissent from the Court's holding with repect to the applicability of the Clayton Act to this merger, I wish to make clear that I do not necessarily dissent from its judgment invalidating the merger. To do so would require me to conclude in addition that on the record as it stands the Government has failed to prove a violation of the Sherman Act, which is fully applicable to the commercial banking business. In my opinion there is a substantial Sherman Act issue in this case, but since the Court does not reach it and since my views relative thereto would be superfluous in light of today's disposition of the case, I express no ultimate conclusion concerning it. Compare Rescue Army v. Municipal Court of Los Angeles, 331 U.S. 549, 585, 67 S.Ct. 1409, 1427—1428, 91 L.Ed. 1666 (Murphy, J., dissenting); Poe v. Ullman, 367 U.S. 497, 555, 81 S.Ct. 1752, 1783, 6 L.Ed.2d 989 (Stewart, J., dissenting).
1
Section 1 of the Sherman Act provides in pertinent part: 'Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.' Section 7 of the Clayton Act, as amended in 1950 by the Celler-Kefauver Antimerger Act, provides in pertinent part: 'No corporation engaged in commerce shall acquire, directly or indirectly, the whole or any part of the stock or other share capital and no corporation subject to the jurisdiction of the Federal Trade Commission shall acquire the whole or any part of the assets of another corporation engaged also in commerce, where in any line of commerce in any section of the country, the effect of such acquisition may be substantially to lessen competition, or to tend to create a monopoly.'
2
The discussion in this portion of the opinion draws upon undisputed evidence of record in the case, supplemented by pertinent reference materials. See Board of Govs. of the Fed. Res. System, Financing Small Business (Comm. print 1958); The Federal Reserve System (3d ed. 1954); Concentration of Banking in the United States (Comm. print 1952); Bogen, The Competitive Position of Commercial Banks (1959); Commission on Money and Credit, Money and Credit (1961); Freeman, The Problems of Adequate Bank Capital (1952); Hart, Money, Debt, and Economic Activity (2d ed. 1953); Lent, The Changing Structure of Commercial Banking (1960); Sayers, Modern Banking (5th ed. 1960); Staff of House Select Comm. on Small Business, 86th Cong., 2d Sess., Banking Concentration and Small Business (1960); U.S. Attorney General's Comm. on Administrative Procedure, Federal Control of Banking (S. Doc. No. 186, 76th Cong., 3d Sess., 1940); Fox, Supervision of Banking by the Comptroller of the Currency, in Public Administration and Policy Formation (Redford ed. 1956), 117; Stokes, Public Convenience and Advantage in Applications for New Banks and Branches, 74 Banking L.J. 921 (1957). For materials which focus specifically on the question of competition in the banking industry, see also Alhadeff, Monopoly and Competition in Banking (1954); Chapman, Concentration of Banking (1934); Horvitz, Concentration and Competition in New England Banking (1958); Lawrence, Banking Concentration in the United States (1930); Berle, Banking Under the Anti-Trust Laws, 49 Col.L.Rev. 589 (1949); Chandler, Monopolistic Elements in Commercial Banking, 46 J.Pol.Econ. 1 (1938); Gruis, Antitrust Laws and Their Application to Banking, 24 Geo.Wash.L.Rev. 89 (1955); Funk, Antitrust Legislation Affecting Bank Mergers, 12 Bus.Law 496 (1957); Klebaner, Federal Control of Commercial Bank Mergers, 37 Ind.L.J. 287 (1962); Wemple and Cutler, The Federal Bank Merger Law and the Antitrust Laws, 16 Bus.Law. 994 (1961); Comment, Bank Charter, Branching, Holding Company and Merger Laws: Competition Frustrated, 71 Yale L.J. 502 (1962); Note, Federal Regulation of Bank Mergers: The Opposing Views of the Federal Banking Agencies and the Department of Justice, 75 Harv.L.Rev. 756 (1962).
3
In addition, there is a certain amount of bank holding company activity. The Bank Holding Company Act of 1956, 12 U.S.C. §§ 1841—1848, brought bank holding companies under stringent federal regulation. As of 1958, the 43 registered bank holding companies controlled 5.7% of all banking offices and 7.4% of all deposits. Lent, The Changing Structure of Commercial Banking (1960), 19. See also Comment, supra, note 2, 71 Yale L.J., at 516 522.
4
Such creation is not, to be sure, pure sleight of hand. A bank may not make a loan without adequate reserves. Nevertheless, the element of bank money creation is real. E.g., Samuelson, Economics (5th ed. 1961), 331—343.
5
The principal banking 'products' are of course various types of credit, for example: unsecured personal and business loans, mortgage loans, loans secured by securities or accounts receivable, automobile installment and consumer goods installment loans, tuition financing, bank credit cards, revolving credit funds. Banking services include: acceptance of demand deposits from individuals, corporations, governmental agencies, and other banks; acceptance of time and savings deposits; estate and trust planning and trusteeship services; lock boxes and safety-deposit boxes; account reconciliation services; foreign department services (acceptances and letters of credit); correspondent services; investment advice. It should be noted that many other institutions are in the business of supplying credit, and so more or less in competition with commercial banks (see further, pp. 356 357, infra), for example: mutual savings banks, savings and loan associations, credit unions, personal-finance companies, sales-finance companies, private businessmen (through the furnishing of trade credit), factors, direct-lending government agencies, the Post Office, Small Business Investment Corporations, life insurance companies.
6
In 1957, for example, there were three bank suspensions in the entire country by reason of financial difficulties; in 1960, two; and in 1961, nine. Of these nine, four involved state banks which were neither members of the FRS nor insured by the FDIC. 1961 Annual Report of the Comptroller of the Currency 286. In a typical year in the 1920's, roughly 600 banks failed throughout the country, about 100 of them national banks. See S.Rep.No. 196, Regulation of Bank Mergers, 86th Cong., 1st Sess. 17—18.
7
The proposed 'merger' of appellees is technically a consolidation, since the resulting bank will be a different entity from either of the constituent banks, whereas if the transaction were a merger, Girard would disappear into PNB and PNB would survive. However, the proposed transaction resembles a merger very closely, in that PNB's shareholders are not to surrender their present share certificates and the resulting bank is to operate under PNB's charter. In any event, the statute treats mergers and consolidations essentially alike, compare 12 U.S.C. (1958 ed., Supp. IV) § 215 with § 215a, and it is not suggested that the legal question of the instant case would be affected by whether the transaction is technically a merger or a consolidation. Therefore, throughout this opinion we use the term 'merger.'
8
Section 1828(c) provides in pertinent part:
'No insured (by FDIC) bank shall merge or consolidate with any other insured bank or, either directly or indirectly, acquire the assets of, or assume liability to pay any deposits made in, any other insured bank without the prior written consent (i) of the Comptroller of the Currency if the acquiring, assuming, or resulting bank is to be a national bank or a District (of Columbia) bank, or (ii) of the Board of Governors of the Federal Reserve System if the acquiring, assuming, or resulting bank is to be a State member bank (except a District bank), or (iii) of the (Federal Deposit Insurance) Corporation if the acquiring, assuming, or resulting bank is to be a non-member insured bank (except a District bank). * * * In granting or withholding consent under this subsection, the Comptroller, the Board, or the Corporation, as the case may be, shall consider the financial history and condition of each of the banks involved, the adequacy of its capital structure, its future earnings prospects, the general character of its management, the convenience and needs of the community to be served, and whether or not its corporate powers are consistent with the purposes of this chapter. In the case of a merger, consolidation, acquisition of assets, or assumption of liabilities, the appropriate agency shall also take into consideration the effect of the transaction on competition (including any tendency toward monoply), and shall not approve the transaction unless, after considering all of such factors, it finds the transaction to be in the public interest. In the interests of uniform standards, before acting on a merger, consolidation, acquisition of assets, or assumption of liabilities under this subsection, the agency (unless it finds that it must act immediately in order to prevent the probable failure of one of the banks involved) shall request a report on the competitive factors involved from the Attorney General and the other two banking agencies referred to in this subsection * * *. The Comptroller, the Board, and the Corporation shall each include in its annual report to the Congress a description of each merger, consolidation, acquisition of assets, or assumption of liabilities approved by it during the period covered by the report, along with the following information: * * * a statement by the Comptroller, the Board, or the Corporation, as the case may be, of the basis for its approval.'
9
See 12 U.S.C. § 84, p. 329, supra. The resulting bank would have a lending limit of $15,000,000, of which $1,000,000 would not be attributable to the merger but to unrelated accounting factors.
10
There was evidence that Philadelphia, although it ranks fourth or fifth among the Nation's urban areas in terms of general commercial activity, ranks only ninth in terms of the size of its largest bank, and that some large business firms which have their head offices in Philadelphia must seek elsewhere to satisfy their banking needs because of the inadequate lending limits of Philadelphia's banks; First Pennsylvania and PNB, currently the two largest banks in Philadelphia, each have a lending limit of $8,000,000. Girard's is $6,000,000.
Appellees offered testimony that the merger would enable certain economies of scale, specifically, that it would enable the formation of a more elaborate foreign department than either bank is presently able to maintain. But this attempted justification, which was not mentioned by the District Court in its opinion and has not been developed with any fullness before this Court, we consider abandoned.
11
We reject the argument that § 11 of the Clayton Act, as amended, 15 U.S.C. § 21, confers jurisdiction over banks upon the FTC. That section provides in pertinent part: 'Authority to enforce compliance with sections 13, 14, 18, and 19 of this title (§§ 2, 3, 7, and 8 of the Clayton Act, as amended) by the persons respectively subject thereto is vested * * * in the Federal Reserve Board where applicable to banks, banking associations, and trust companies; and in the Federal Trade Commission where applicable to all other character of commerce * * *.' The argument is that since the FRB has no authority to enforce the Clayton Act against bank mergers, see note 22, infra, bank mergers must fall into the residual category of 'all other character of commerce' and so be subject to the FTC. However, there is no intimation in the legislative history of the 1950 amendment to §§ 7 and 11 that the FTC's traditional lack of jurisdiction over banks was to be disturbed. Moreover, it is clear from the language of § 11 that 'banks, banking associations, and trust companies' are meant to comprise a distinct 'character of commerce,' and so cannot be part of the 'other character of commerce' reserved to the FTC.
The exclusion of banks from the FTC's jurisdiction appears to have been motivated by the fact that banks were already subject to extensive federal administrative controls. See T. C. Hurst & Son v. Federal Trade Comm'n, 268 F. 874, 877 (D.C.E.D.Va.1920).
12
No argument is made in this case that banking is not commerce, and therefore that § 7 is inapplicable; plainly, such an argument would have no merit. See Transamerica Corp. v. Board of Govs. of Fed. Res. Sys., 206 F.2d 163, 166 (C.A.3d Cir., 1953); cf. United States v. South-Eastern Underwriters Assn., 322 U.S. 533, 64 S.Ct. 1162, 88 L.Ed. 1440.
13
'A merger necessarily involves the complete disappearance of one of the merging corporations. A sale of assets, on the other hand, may involve no more than a substitution of cash for some part of the selling company's properties, with no change in corporate structure and no change in stockholder interests. Shareholders of merging corporations surrender their interests in those corporations in exchange for their very different rights in the resulting corporation. In an asset acquisition, however, the shareholders of the selling corporation obtain no interest in the purchasing corporation and retain no interest in the assets transferred. In a merger, unlike an asset acquisition, the resulting firm automatically acquires all the rights, powers, franchises, liabilities, and fiduciary rights and obligations of the merging firms. In a merger, but not in an asset acquisition, there is the likelihood of a continuity of management and other personnel. Finally, a merger, like a stock acquisition, necessarily involves the acquisition by one corporation of an immediate voice in the management of the business of another corporation; no voice in the decisions of another corporation is acquired by purchase of some part of its assets.' Brief for the United States, 75—76.
14
'(A) merger such as appellees' may be effected upon the affirmative vote of the holders of only two-thirds of the outstanding stock of each bank * * * but if PNB were acquiring all of the Girard stock each Girard shareholder could decide for himself whether to transfer his shares. A merger requires public notice whereas stock can be acquired privately. A shareholder dissenting from a merger has the right to receive the appraised value of his shares * * * whereas no shareholder has a comparable right in an acquisition of stock. Furthermore the corporate existence of a merged company is terminated by a merger, but remains unaffected by an acquisition of stock.' Brief for Appellees, 30—31.
15
The legislative history of the 1914 Act is reviewed in Brown Shoe Co. v. United States, 370 U.S. 294, 313—314, and notes 22—24, 82 S.Ct. 1502, 1517—1518, 8 L.Ed.2d 510.
16
In the case of an acquisition like the instant one, in which shares in the acquired corporation are to be exchanged for shares in the resulting corporation, a fortiori we discern no difficulty in conceptualizing the transaction as a 'stock acquisition.' Compare note 13, supra.
17
Statements to the same effect may be found in, e.g., Brown Shoe Co., supra, 370 U.S., at 313—314, 316, 82 S.Ct., at 1517—1518, 1519, 8 L.Ed.2d 510; United States v. E. I. Du Pont De Nemours & Co., 353 U.S. 586, 592, 77 S.Ct. 872, 876—877, 1 L.Ed.2d 1057; United States v. Columbia Steel Co., 334 U.S. 495, 507 n. 7, 68 S.Ct. 1107, 1114, 92 L.Ed. 1533; United States v. Columbia Pictures Corp., 189 F.Supp. 153, 182 (D.C.S.D.N.Y.1960). See also 33 Op.Atty.Gen. 225, 241 (1922); Hernacki, Mergerism and Section 7 of the Clayton Act, 20 Geo.Wash. L.Rev. 659, 676—677 (1952); Wemple and Cutler, The Federal Bank Merger Law and the Antitrust Laws, 16 Bus.Law. 994, 999—1000 (1961); Note, Section 7 of the Clayton Act: A Legislative History, 52 Col.L.Rev. 766, 768—769 (1952).
Actually, the holdings in the three cases that reached this Court, Thatcher, Swift, and Arrow-Hart, were quite narrow. See generally Note, 26 Col.L.Rev. 594—596 (1926). They were based not on a lack of substantive power under § 7, but on the enforcement section, § 11, which limited the FTC's remedial powers to 'an order requiring such person to cease and desist from such violations (of §§ 2, 3, 7, and 8 of the Clayton Act), and divest itself of the stock held or rid itself of the directors chosen contrary to the provisions of sections seven and eight of this Act.' 38 Stat. 735. Faced with Congress' evident refusal to confer upon the FTC the ordinary powers of a court of equity, this Court held that unless the assets were acquired after the FTC's order of stock divestiture had been issued (which was the case in Federal Trade Comm'n v. Western Meat Co., supra, where the Commission was sustained), the Commission could not order a divestiture of assets. Compare Board of Govs. of Fed. Res. Sys. v. Transamerica Corp., 184 F.2d 311 (C.A.9th Cir., 1950), with Federal Trade Comm'n v. International Paper Co., 241 F.2d 372 (C.A.2d Cir., 1956). Since under this Court's decisions the FTC was powerless even where the transfer of assets was an evasive maneuver aimed at defeating the FTC's remedial jurisdiction over stock acquisitions violative of § 7, a fortiori the Commission was powerless against the typical merger. See Arrow-Hart & Hegeman Elec. Co. v. Federal Trade Comm'n, supra, 291 U.S., at 595, 598—599, 54 S.Ct., at 532, 78 L.Ed. 1007. As part of the 1950 amendments to the Clayton Act, § 11 was amended to read: 'an order requiring such person to * * * divest itself of the stock, or other share capital, or assets, held * * *.' 15 U.S.C. § 21. Whether as an original matter Thatcher, Swift and Arrow-Hart were correctly decided is no longer an open question, since they were the explicit premise of the 1950 amendment to § 7. See State Bd. of Ins. v. Todd Shipyards Corp., 370 U.S. 451, 458, 82 S.Ct. 1380, 1385, 8 L.Ed.2d 620, p. 349, infra.
The question of the FTC's remedial powers under § 11 of the Clayton Act is to be distinguished from that of its remedial powers under § 5 of the Federal Trade Commission Act, 15 U.S.C. § 45(b). In Federal Trade Comm'n v. Eastman Kodak Co., 274 U.S. 619, 47 S.Ct. 688, 71 L.Ed. 1238, the Court, relying on Thatcher and Swift, held that the Commission had no power to order divestiture in § 5 proceedings. But cf. Gilbertville Trucking Co. v. United States, 371 U.S. 115, 129—131, 83 S.Ct. 217, 225—227, 9 L.Ed.2d 177; Pan American World Airways v. United States, 371 U.S. 296, 312, and n. 17, 83 S.Ct. 476, 486, 9 L.Ed.2d 325.
18
See note 1, supra, for text of amended § 7. The original § 7 read in pertinent part: 'no corporation engaged in commerce shall acquire, directly or indirectly, the whole or any part of the stock or other share capital of another corporation engaged also in commerce, where the effect of such acquisition may be to substantially lessen competition between the corporation whose stock is so acquired and the corporation making the acquisition, or to restrain such commerce in any section or community, or tend to create a monopoly of any line of commerce.'
The passage of the 1950 amendment followed many years of unsuccessful attempts to enact legislation plugging the assets-acquisition loophole. See Note, 52 Col.L.Rev. 766—767, notes 3 and 4 (1952). To be sure, the 1950 amendment was intended not only to enlarge the number of transactions covered by § 7 but also to change the test of illegality. The legislative history pertinent to the latter point is reviewed in Brown Shoe Co., supra, 370 U.S., at 315—323, 82 S.Ct., at 1518—1523, 8 L.Ed.2d 510, and is not directly relevant to the present discussion.
19
'The purpose of the proposed legislation (the 1950 amendments to § 7) is to prevent corporations from acquiring another corporation by means of the acquisition of its assets, whereunder (sic) the present law it is prohibited from acquiring the stock of said corporation. Since the acquisition of stock is significant chiefly because it is likely to result in control of the underlying assets, failure to prohibit direct purchase of the same assets has been inconsistent and paradoxical as to the over-all effect of existing law.' S.Rep. No. 1775, 81st Cong., 2d Sess. 2, U.S.Code Congressional Service 1950, p. 4293. This theme pervaded congressional consideration of the proposed amendments. See, e.g., H.R.Rep. No. 1191, 81st Cong., 1st Sess., passim; Hearing before Subcommittee No. 3 of the House Committee on the Judiciary on Amending Sections 7 and 11 of the Clayton Act, 81st Cong., 1st Sess., ser. 10, pp. 11—13, 28—29, 39, 117; Hearings before a Subcommittee of the Senate Committee on the Judiciary on Corporate Mergers and Acquisitions, 81st Cong., 1st and 2d Sess. 4 5, 15, 20, 62—63, 126—129, 139, 321; 95 Cong.Rec. 11485 (Congressman Celler, sponsor of the bill to amend § 7 in the House: 'this bill seeks to plug a loophole in the present antitrust laws. . . . It is time to stop, look, and listen and to call a halt to the merger movement that is going on in this country'), 11493—11494, 11497, 11502; 96 Cong.Rec. 16433, 16443.
20
Columbia Steel involved the cash purchase by United States Steel Corporation of the physical assets of Consolidated Steel Corporation; there was no exchange of shares and no alteration of Consolidated's corporate identity. See Transcript of Record, United States v. Columbia Steel Co., 334 U.S. 495, 68 S.Ct. 1107, 92 L.Ed. 1533 (No. 461, October Term, 1947), pp. 453 475. As a result of the purchase, in its horizontal aspect, U.S. Steel controlled about 24% of the structural steel fabricating market in an 11-state western area. This Court held that the acquisition could not be reached under § 7 of the Clayton Act, see 334 U.S., at 507, n. 7, 68 S.Ct., at 1114, 92 L.Ed. 1533, and did not violate the Sherman Act. It should be noted, however, that the Court regarded the 24% market-share figure proposed by the Government as a 'doubtful assumption' and also pointed to 'unusual conditions' tending to mitigate the anticompetitive effect of the acquisition. 334 U.S., at 529, 68 S.Ct., at 1125, 92 L.Ed. 1533. Columbia Steel was repeatedly cited by Congressmen considering the amendment of § 7 as an example of what they conceived to be the inability of the Sherman Act, as then construed, to deal with the problems of corporate concentration. See, e.g., H.R.Rep. No. 1191, 81st Cong., 1st Sess. 10—11, and n. 16; Hearing before Subcommittee No. 3 of the House Committee on the Judiciary on Amending Sections 7 and 11 of the Clayton Act, 81st Cong., 1st Sess., ser. 10, pp. 28, 73; Hearings before a Subcommittee of the Senate Committee on the Judiciary on Corporate Mergers and Acquisitions, 81st Cong., 1st and 2d Sess. 24; 96 Cong.Rec. 16453 (Senator Kefauver, Senate sponsor of the bill to amend § 7: 'the Columbia Steel Co. case is a vivid illustration of the necessity for the proposed amendment of the Clayton Act'), 16503; and cf. 96 Cong.Rec. 16498—16499.
21
See note 19, supra. The congressional attitude toward this Court's Thatcher, Swift, and Arrow-Hart decisions is typified in this remark of Senator O'Conor's: 'The Court, in effect, said that the (Federal Trade) Commission was quite free to use the power which Congress had conferred upon it, so long as it confined the use of that power to ordering the divestiture of pieces of paper which happened to be worthless.' 96 Cong.Rec. 16433. Senator O'Mahoney remarked, for example, that there was 'no doubt of the fundamental fact that an innocent defect in the drafting of section 7 of the Clayton Act back in 1914 had resulted in creating a great opportunity for escape by flagrant violators of the law.' 96 Cong.Rec. 16443. After sharply criticizing this Court's decisions, the Senator continued: 'I take it the record is perfectly clear that what this bill purports to do is to correct an omission in the original Clayton Act. When the authors of the Clayton Act and the Congress which passed it enacted the bill into law they thought they were giving the Federal Trade Commission administrative authority to prevent monopolistic mergers * * *.' Ibid. So also, Senator Kefauver observed: 'it would have been much better for the economy of the country to have repealed sections 7 and 11 of the Clayton Act rather than let this wide-open loophole to remain. Most of the large and monopolistic mergers which have become detrimental to the free-enterprise system of our Nation have occurred by way of this plain evasion of the intent of the original Clayton Act.' 96 Cong.Rec. 16451.
22
A cash purchase of another bank's assets would not seem to be a fully effective method of corporate acquisition. In other industries, a cash purchase of plant, inventory, patents, trade secrets, and the like will often directly enhance the competitive position of the acquiring corporation, as in Columbia Steel Co. But a bank desiring to increase its share of banking business through corporate acquisition would ordinarily need to acquire the other bank's deposits and capital, not merely its assets. For more deposits mean more working capital, and additions to capital and surplus increase the lending limit. A cash purchase, in effect, only substitutes cash for cash, since bank assets consist principally of cash and very liquid securities and loans receivable, and adds nothing to the acquiring bank's capital and surplus or to its working capital. True, an exchange of its stock for assets would achieve the acquiring bank's objectives. We are clear, however, that in light of Congress' overriding purpose, in amending § 7, to close the loophole in the original section, if such an exchange (or other clearly evasive transaction) were tantamount in its effects to a merger, the exchange would not be an 'assets' acquisition within the meaning of § 7 but would be treated as a transaction subject to that section.
We have not overlooked the fact that there are corporations in other industries not subject to the FTC's jurisdiction. Chief among these are air carriers subject to the Civil Aeronautics Board and other carriers subject to the Interstate Commerce Commission. Both agencies have been given, expressly, broad powers to exempt mergers and acquisitions in whatever form from the antitrust laws. See 49 U.S.C. §§ 1378, 1384; 49 U.S.C. § 5(11) and (13). Therefore, the exclusion of assets acquisitions in such industries from § 7 would seem to have little significance.
Section 11 of the Clayton Act, 15 U.S.C. § 21, vests the FRB with authority to enforce § 7 'where applicable to banks.' This provision has been in the Act since it was first passed in 1914 and was not changed by the 1950 amendments. The Bank Merger Act of 1960, assigning roles in merger applications to the FDIC and the Comptroller of the Currency as well as to the FRB, plainly supplanted, we think, whatever authority the FRB may have acquired under § 11, by virtue of the amendment of § 7, to enforce § 7 against bank mergers. Since the Bank Merger Act applies only to mergers, consolidations, acquisitions of assets, and assumptions of liabilities but not to outright stock acquisitions, the FRB's authority under § 11 as it existed before the 1950 amendment of § 7 remains unaffected. See, e.g., Transamerica Corp. v. Board of Govs. of Fed. Res. Sys., 206 F.2d 163 (C.A.3d Cir., 1953).
Nothing in this opinion, of course, limits the power of the FTC, under §§ 7 and 11, as amended, to reach any transaction, including mergers and consolidations, in the broad range between and including pure stock and pure assets acquisitions, where the acquiring corporation is subject to the FTC's jurisdiction, see 15 U.S.C. § 45(a)(6), and to order divestiture of the stock, share capital, or assets acquired in the transaction, see 15 U.S.C. § 21.
23
See, e.g., statement of Assistant Attorney General Bergson: 'If it (§ 7) is to have any significant effect for the future, it is essential that it be amended so that the Federal Trade Commission will be in a position to deal with the merger problem as it exists today.' Hearing before Subcommittee No. 3 of the House Committee on the Judiciary on Amending Sections 7 and 11 of the Clayton Act, 81st Cong, 1st Sess., ser. 10, p. 28. See also 96 Cong.Rec. 16437, 16452—16453; 95 Cong.Rec. 11490—11491, 11499, 11504 (Representative Byrne: 'the suggested amendment to sections 7 and 11 of the Clayton Act would merely give the (Federal Trade) Commission the same power in regard to asset acquisitions that it already possesses over acquisitions of stock. This would close the loophole and restore meaning to the statute.').
24
See, e.g., Staff of Subcommittee No. 5 of House Committee on the Judiciary, 82d Cong., 2d Sess., Bank Mergers and Concentration of Banking Facilities (1952) vii; H.R. 5948, printed in 102 Cong.Rec. 2108—2109 (1956); Hearings before a Subcommittee of the Senate Committee on Banking and Currency on the Financial Institutions Act of 1957, 85th Cong., 1st Sess., pt. 2, p. 1030 (testimony of Attorney General Brownell); H.R.Rep. No. 1416, Regulation of Bank Mergers, 86th Cong., 2d Sess. 9; S.Rep. No. 196, Regulation of Bank Mergers, 86th Cong., 1st Sess. 1—2, 5.
25
See, e.g., remarks of Representative Spence: 'The Clayton Act is ineffective as to bank mergers because in the case of banks it covers only stock acquisitions and bank mergers are not accomplished that way.' 106 Cong.Rec. 7257 (1960). See also note 24, supra.
26
This contention was abandoned on appeal. We consider it, nevertheless, because it touches the proper relations of the judicial and administrative spheres. United States v. Western Pac. R. Co., 352 U.S. 59, 63, 77 S.Ct. 161, 164—165, 1 L.Ed.2d 126.
27
Contrast this with the express exemption provisions of, e.g., the Federal Aviation Act, 49 U.S.C. § 1384; Federal Communications Act, 47 U.S.C. §§ 221(a), 222(c)(1); Interstate Commerce Act, 49 U.S.C. §§ 5(11), 5b(9), 22; Shipping Act, 46 U.S.C. (1958 ed. Supp. III) § 814; Webb-Pomerene Act, 15 U.S.C. § 62; and the Clayton Act itself, § 7, 15 U.S.C. § 18.
28
See United States v. Trans-Missouri Freight Assn., 166 U.S. 290, 314—315, 17 S.Ct. 540, 548—549, 41 L.Ed. 1007; United States v. Joint Traffic Assn., 171 U.S. 505, 19 S.Ct. 25, 43 L.Ed. 259; Northern Securities Co. v. United States, 193 U.S. 197, 343 (plurality opinion), 374—376 (dissenting opinion), 24 S.Ct. 436, 459, 476—477, 48 L.Ed. 679; United States v. Pacific & Arctic Ry. & Nav. Co., 228 U.S. 87, 105, 107, 33 S.Ct. 443, 448—449, 57 L.Ed. 742; Keogh v. Chicago & N.W.R. Co., 260 U.S. 156, 161—162, 43 S.Ct. 47, 49, 67 L.Ed. 183; Central Transfer Co. v. Terminal Railroad Assn., 288 U.S. 469, 474—475, 53 S.Ct. 444, 446, 77 L.Ed. 899; Terminal Warehouse Co. v. Pennsylvania R. Co., 297 U.S. 500, 513—515, 56 S.Ct. 546, 551—552, 80 L.Ed. 827; United States v. Borden Co., 308 U.S. 188, 197—206, 60 S.Ct. 182, 187—192, 84 L.Ed. 181; United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 226 228, 60 S.Ct. 811, 846—847, 84 L.Ed. 1129; Georgia v. Pennsylvania R. Co., 324 U.S. 439, 456—457, 65 S.Ct. 716, 725—726, 89 L.Ed. 1051; United States Alkali Export Assn. v. United States, 325 U.S. 196, 205—206, 65 S.Ct. 1120, 1126, 89 L.Ed. 1554; Allen Bradley Co. v. Local Union No. 3, 325 U.S. 797, 809—810, 65 S.Ct. 1533, 1539—1540, 89 L.Ed. 1939; Northern Pac. R. Co. v. United States, 356 U.S. 1, 78 S.Ct. 514, 2 L.Ed.2d 545; United States v. Radio Corp. of America, 358 U.S. 334, 79 S.Ct. 457, 3 L.Ed.2d 354; Maryland & Va. Milk Producers Assn. v. United States, 362 U.S. 458, 464—467, 80 S.Ct. 847, 852—854, 4 L.Ed.2d 880; People of State of California v. Federal Power Comm'n, 369 U.S. 482, 82 S.Ct. 901, 8 L.Ed.2d 54; Pan American World Airways v. United States, 371 U.S. 296, 304, 305, 83 S.Ct. 476, 481—482, 9 L.Ed.2d 325; Silver v. New York Stock Exchange, 373 U.S. 341, 83 S.Ct. 1246.
29
See, e.g., Keogh v. Chicago & N.W.R. Co., supra, 260 U.S., at 163, 43 S.Ct., at 49—50, 67 L.Ed. 183; Pan American World Airways v. United States, supra, 371 U.S., at 309—310, 83 S.Ct., at 484—485, 9 L.Ed.2d 325. Cf. Texas & Pac. R. Co. v. Abilene Cotton Oil Co., 204 U.S. 426, 27 S.Ct. 350, 51 L.Ed. 553.
30
With respect to the question (upon which we intimate no view) whether judicial review of the Comptroller's decision is possible notwithstanding the absence of a specific provision, see Note, 75 Harv.L.Rev. 756, 762—763 (1962); Note, 37 N.Y.U.L.Rev. 735, 750, n. 95 (1962); cf. 1 Davis, Administrative Law (1958), § 4.04.
31
See generally Jaffe, Primary Jurisdiction Reconsidered. The Anti-Trust Laws, 102 U. of Pa.L.Rev. 577 (1954); Latta, Primary Jurisdiction in the Regulated Industries and the Antitrust Laws, 30 U. of Cin.L.Rev. 261 (1961); Note, Regulated Industries and the Antitrust Laws: Substantive and Procedural Coordination, 58 Col.L.Rev. 673 (1958).
32
In People of State of California v. Federal Power Comm'n, supra, the Court held that the FPC must stay its proceeding on a merger application until the completion of a pending antitrust suit by the Justice Department; a fortiori, the court entertaining the suit would not be required to abstain pending consideration of the merger application by the FPC. We need not and do not consider the question whether the California decision would control here had the Comptroller been denied an opportunity to approve the merger before the antitrust suit was commenced.
33
Cf. United States v. Aluminum Co. of America, 148 F.2d 416, 425 (C.A.2d Cir., 1945). In the instant case, unlike Aluminum Co., there is virtually no time lag between the banks' furnishing competing financial institutions (small-loan companies, for example) with the raw material, i.e., money, and the institutions' selling the finished product, i.e., loans; hence the instant case, compared with Aluminum Co. in this respect, is a fortiori. As one banker testified quite frankly in the instant case in response to the question: 'Do you feel that you are in substantial competition with these institutions (personal-finance and sales-finance companies) that you lend * * * such money to for loans that you want to make?'—'Oh, no, we definitely do not. If we did, we would stop making the loans to them.' (R. 298.) The reason for the competitive disadvantage of most lending institutions vis-a-vis banks is that only banks obtain the bulk of their working capital without having to pay interest or comparable charges thereon, by virtue of their unique power to accept demand deposits. The critical area of short-term commercial credit, see pp. 326—327, supra, appears to be one in which banks have little effective competition, save in the case of very large companies which can meet their financing needs from retained earnings or from issuing securities or paper.
34
As one witness for the defendants testified:
'We have had in Philadelphia for 50 years or more the mutual savings banks offering 1/2 per cent and in some instances more than 1/2 per cent higher interest than the commercial banks. Nevertheless, the rate of increase in savings accounts in commercial banks has kept pace with and in many of the banks exceeded the rate of increase of the mutual banks paying 3 1/2 per cent. * * *
'I have made some inquiries. There are four banks on the corner of Broad and Chestnut. Three of them are commercial banks all offering 3 per cent, and one is a mutual savings bank offering 3 1/2. As far as I have been able to discover, there isn't anybody in Philadelphia who will take the trouble to walk across Broad Street to get 1/2 of 1 per cent more interest. If you ask me why, I will say I do not know. Habit, custom, personal relationships, convenience, doing all your banking under one roof appear to be factors superior to changes in the interest rate level.' (R. 1388 1389.)
35
Consider the following colloquy between governmental counsel and a witness for the defendants:
'Q. What do you consider to be the area of a branch office?
'A. Well, there is no set rule on that. We hope to have an area from 1 1/2 to 2 miles.
'However, we have opened branches directly in the communities where other banks are established, in fact, across the street from them because it is not only a question of getting new business, it's a question of servicing and retaining the accounts that we now have.
'Q. And your business is not necessarily dependent upon it (the customer) being within a mile or two of a branch, is it?
'A. To a large degree, it is, because we found that we were losing deposit accounts regularly from our in-town offices because other banks were opening or had offices in other sections of the city; and in order to retain those accounts and to get additional business we felt it was necessary to establish branches.' (R. 1815.)
As far as the customer for a bank loan is concerned, 'the size of his market is somewhat dependent upon his own size, how well he is known, and so on. For example, for small business concerns known primarily locally, they may consider that their market is a strictly local one, and they may be forced by circumstances to do business with banks in a nearby geographic relationship to them. On the other hand, as business increase in size, the scope of their business activities, their national reputation, the alternatives they have available to them will be spread again over a very large area, possibly as large as the entire United States.' (R. 1372.) (Defendants' testimony on direct examination.)
36
The figures for PNB and Girard respectively are: 54% and 63% of the dollar volume of their commercial and industrial loans originate in the four-county area; 75% and 70%, personal loans; 74% and 84%, real estate loans; 41% and 62%, lines of credit; 94% and 72%, personal trusts; 81% and 94%, time and savings deposits; 56% and 77%, demand deposits; 93% and 87%, demand deposits of individuals. Actually, these figures may be too low. The evidence discloses that most of the business done outside the area is with large borrowers and large depositors; appellees do not, by and large, deal with small businessmen and average individuals not located in the four-county area. For example, of appellees' combined total business demand deposits under $10,000 94% originate in the four-county area. This reinforces the thesis that the smaller the customer, the smaller is his banking market geographically. See note 35, supra.
The appellees concede that the four-county area has sufficient commercial importance to qualify, under Brown Shoe Co., supra, 370 U.S., at 336—337, 82 S.Ct., at 1529—1531, 8 L.Ed.2d 510, as a 'section of the country' within the meaning of § 7. See Maryland & Va. Milk Producers Assn. v. United States, 362 U.S. 458, 469, 80 S.Ct. 847, 854—855, 4 L.Ed.2d 880; cf. United States v. Yellow Cab Co., 332 U.S. 218, 226, 67 S.Ct. 1560, 1564—1565, 91 L.Ed. 2010; Indiana Farmer's Guide Publishing Co. v. Prairie Farmer Publishing Co., 293 U.S. 268, 279, 55 S.Ct. 182, 185—186, 79 L.Ed. 356.
37
Appellees suggest not that bank offices skirting the four-county area provide meaningful alternatives to bank customers within the area, but that such alternatives are provided by large banks, from New York and elsewhere, which solicit business in the Philadelphia area. There is no evidence of the amount of business done in the area by banks with offices outside the area; it may be that such figures are unobtainable. In any event, it would seem from the local orientation of banking insofar as smaller customers are concerned, see notes 35 and 36, supra, that competition from outside the area would only be important to the larger borrowers and depositors. If so, the four-county area remains a valid geographical market in which to assess the anticompetitive effect of the proposed merger upon the banking facilities available to the smaller customer—a perfectly good 'line of commerce,' in light of Congress' evident concern, in enacting the 1950 amendments to § 7, with preserving small business. See Brown Shoe Co., supra, 370 U.S., at 315—316, 82 S.Ct., at 1518—1519, 8 L.Ed.2d 510. As a practical matter the small businessman can only satisfy his credit needs at local banks. To be sure, there is still some artificiality in deeming the four-county area the relevant 'section of the country' so far as businessmen located near the perimeter are concerned. But such fuzziness would seem inherent in any attempt to delineate the relevant geographical market. Note, 52 Col.L.Rev. 766, 778—779, n. 77 (1952). And it is notable that outside the four-county area, appellees' business rapidly thins out. Thus, the other six counties of the Delaware Valley account for only 2% of appellees' combined individual demand deposits; 4%, demand deposits of partnerships and corporations; 7%, loans; 2%, savings deposits; 4%, business time deposits.
38
See Kaysen and Turner, Antitrust Policy (1959), 133; Stigler, Mergers and Preventive Antitrust Policy, 104 U. of Pa.L.Rev. 176, 182 (1955); Bok, supra, at 308—316, 328. Cf. Markham, Merger Policy Under the New Section 7: A Six-Year Appraisal, 43 Va.L.Rev. 489, 521—522 (1957).
39
Comment, 'Substantially to Lessen Competition * * *': Current Problems of Horizontal Mergers, 68 Yale L.J. 1627, 1638 1639 (1959); see, e.g., Machlup, The Economics of Sellers' Competition (1952), 84—93, 333-336; Bain, Barriers to New Competition (1956), 27. Cf. Mason, Market Power and Business Conduct: Some Comments, 46—2 Am.Econ.Rev. (1956), 471.
40
See p. 331, supra. We note three factors that cause us to shade the percentages given earlier in this opinion, in seeking to calculate market share. (1) The percentages took no account of banks which do business in the four-county area but have no offices there; however, this seems to be a factor of little importance, at least insofar as smaller customers are concerned, see note 37, supra. (2) The percentages took no account of banks which have offices in the four-county area but not their home offices there; however, there seem to be only two such offices and appellees in this Court make no reference to this omission. (3) There are no percentages for the amount of business of banks located in the area, other than appellees, which originates in the area. Appellees contend that since most of the 40 other banks are smaller, they do a more concentratedly local business than appellees, and hence account for a relatively larger proportion of such business. If so, we doubt much correction is needed. The five largest banks in the four-county area at present control some 78% of the area banks' assets. Thus, even if the small banks have a somewhat different pattern of business, it is difficult to see how that would substantially diminish the appellees' share of the local banking business.
No evidence was introduced as to the quantitative significance of these three factors, and appellees do not contend that as a practical matter such evidence could have been obtained. Under the circumstances, we think a downward correction of the percentages to 30% produces a conservative estimate of appellees' market share.
41
Kaysen and Turner, supra, note 38, suggest that 20% should be the line of prima facie unlawfulness; Stigler suggests that any acquisition by a firm controlling 20% of the market after the merger is presumptively unlawful; Markham mentions 25%. Bok's principal test is increase in market concentration, and he suggests a figure of 7% or 8%. And consult note 20, supra. We intimate no view on the validity of such tests for we have no need to consider percentages smaller than those in the case at bar, but we note that such tests are more rigorous than is required to dispose of the instant case. Needless to say, the fact that a merger results in a less-than-30% market share, or in a less substantial increase in concentration than in the instant case, does not raise an inference that the merger is not violative of § 7. See, e.g., Brown Shoe Co., supra.
42
See note 41, supra. It is no answer that, among the three presently largest firms (First Pennsylvania, PNB, and Girard), there will be no increase in concentration. If this argument were valid, then once a market had become unduly concentrated, further concentration would be legally privileges. On the contrary, if concentration is already great, the importance of preventing even slight increases in concentration and so preserving the possibility of eventual deconcentration is correspondingly great. Comment, note 39, supra, at 1644.
43
The fact that some of the bank officers who testified represented small banks in conpetition with appellees does not substantially enhance the probative value of their testimony. The test of a competitive market is not only whether small competitors flourish but also whether consumers are well served. See United States v. Bethlehem Steel Corp., 168 F.Supp. 576, 588, 592 (D.C.S.D.N.Y.1958). '(C)ongressional concern (was) with the protection of competition, not competitors.' Brown Shoe Co., supra, 370 U.S., at 320, 82 S.Ct., at 1521, 8 L.Ed.2d 510. In an oligopolistic market, small companies may be perfectly content to follow the high prices set by the dominant firms, yet the market may be profoundly anticompetitive.
44
Entry is, of course, wholly a matter of governmental grace. See p. 1722, supra. In the 10-year period ending in 1961, only one
new bank opened in the Philadelphia four-county area. That was in 1951. At the end of 10 years, the new bank controlled only one-third of 1% of the area's deposits.
45
The following colloquy is representative:
'Q. Mr. Jennings, what is the nature of competition among commercial banks?
'A. Keen, highly competitive. I think, from my own observation, that I have never known competition among banks to be keener than it is today. * * *
'Q. In what area does competition exist? * * *
'A. I think the stiffest, sternest competition of all is in the field to obtain demand deposits and loans. * * *
'Q. What form does the competition take?
'A. It takes many forms. If we are dealing with the deposits of large corporations, wealthy individuals, I would say that most, if not all, of the major banks of the country are competing for such deposits. The same would hold true as regards loans to those corporations or wealthy individuals.
'If we go into the field of smaller loans, smaller deposits, the competition is more regional—wide but nevertheless regional and there the large banks as well as the small banks are after that business with everything they have.
'Q. What form does the competition take? Is it competition in price?
'A. No, I wouldn't say that it is competition as to price. After all, interest rates are regulated at the top level by the laws of the
50 states. Interest rates at the bottom level have no legal limitation, but for practical purposes the prime rate * * * furnishes a very effective floor. I would say that the area of competition for interest rates would range between, let us say, the prime rate of 4 1/2 and 6 per cent for normal loans exclusive of consumer loans, where higher rates are permitted.
'In the area of service charges, I would say that banks are competitive in that field. They base their service charges primarily on their costs, but they have to maintain a weather eye to windward as to what the competitors are charging in the service charge field. The minute they get out of line in connection with service charges they find their customers will start to protest, and if something isn't done some of the customers will leave them for a differential in service charges of any significance.
'I do not believe that competition is really affected by the price area. I think it is affected largely by the quality and the caliber of service that banks give and whether or not they feel they are being received in the right way, whether they are welcome in the bank. Personalities enter into it very heavily, but I do not think price as such is a major factor in banking competition. It is there, it is a factor, but not major.' (R. 1940—1942.)
It should be noted that besides competition in interest rates, there is a great deal of indirect price competition in the banking industry. For example, the amount of compensating balance a bank requires of a borrower (i.e., the amount the borrower must always retain in his demand deposit account with the bank) affects the real cost of the loan, and varies considerably in the bank's discretion.
46
Thus, arguably, the so-called failing-company defense, see International Shoe Co. v. Federal Trade Comm'n, 280 U.S. 291, 299—303, 50 S.Ct. 89, 91—93, 74 L.Ed. 431, might have somewhat larger contours as applied to bank mergers because of the greater public impact of a bank failure compared with ordinary business failures. But the question what defenses in § 7 actions must be allowed in order to avert unsound banking conditions is not before us, and we intimate no view upon it.
1
See Wemple and Cutler, The Federal Bank Merger Law and the Antitrust Laws, 16 BusLaw 994, 995 (1961). Many of the bills are summarized in Funk, Antitrust Legislation Affecting Bank Mergers, 75 Banking L.J. 369 (1958).
2
These agencies and the areas of their primary supervisory responsibility are: (1) the Comptroller of the Currency—national banks; (2) the Federal Reserve System—state Reserve-member banks; (3) the FDIC—insured nonmember banks.
3
Samuelson, Economics (5th ed. 1961), p. 311.
4
For example, savings and loan associations, credit unions, and other institutions compete with banks in installment lending to individuals, and banks are in competition with individuals in the personal trust field.
5
Since bank insolvencies destroy sources of credit, not only borrowers but also others who rely on the borrowers' ability to secure loans may be adversely affected. See Berle, Banking Under the Anti-Trust Laws, 49 Col.L.Rev. 589, 592 (1949).
6
The term 'merger' is generally used throughout this opinion to designate any form of corporate amalgamation. See note 7 in the Court's opinion, ante, p. 332. Occasionally, however, as in the above paragraph, the terms 'merger' and 'consolidation' are used in their technical sense.
7
40 Stat. 1043, as amended, 12 U.S.C. (Supp. IV, 1963) § 215.
8
44 Stat. 1225, as amended, 12 U.S.C. (Supp. IV, 1963) § 215.
9
66 Stat. 599, as amended, 12 U.S.C. (Supp. IV, 1963) § 215a.
10
See Paton, Conversion, Merger and Consolidation Legislation—'Two-Way Street' For National and State Banks, 71 Banking L.J. 15 (1954).
11
64 Stat. 455, as amended, 12 U.S.C. § 214a.
12
64 Stat. 457; see 64 Stat. 892 (now 74 Stat. 129, 12 U.S.C. (Supp. IV, 1963) § 1828(c)).
13
Ibid. However, under the Act, insured banks merging with insured state banks did not have to obtain approval unless the capital stock or surplus of the resulting or assuming bank would be less than the aggregate capital stock or surplus of all the merging banks.
14
See Hearings before the Antitrust Subcommittee of the House Committee on the Judiciary, 84th Cong., 1st Sess., Ser. 3, pt. 1, pp. 243—244 (1955); Hearings on S. 3911 before a Subcommittee of the Senate Committee on Banking and Currency, 84th Cong., 2d Sess. 60—61, 84 (1956); Hearings on S. 1062 before the Senate Committee on Banking and Currency, 86th Cong., 1st Sess. 9 (1959).
15
See also H.R.Rep. No. 1416, 86th Cong., 2d Sess. 5 (1960) ('The Federal antitrust laws are also inadequate to the task of regulating bank mergers; while the Attorney General may move against bank mergers to a limited extent under the Sherman Act, the Clayton Act offers little help.'); id., at 9 ('Because section 7 (of the Clayton Act) is limited, insofar as banks are concerned, to cases where a merger is accomplished through acquisition of stock, and because bank mergers are accomplished by asset acquisitions rather than stock acquisitions, the act offers 'little help,' in the words of Hon. Robert A. Bicks, acting head of the Antitrust Division, in controlling bank mergers.').
16
In the Senate, a sponsor of S. 1062, Senator Fulbright, reported that the '1950 amendment to section 7 of the Clayton Act, which for the first time imposed controls over mergers by means other than stock acquisitions, did not apply to bank mergers which are practically invariably accomplished by means other than stock acquisition. Accordingly for all practical purposes bank mergers have been and still are exempt from section 7 of the Clayton Act.' 106 Cong.Rec. 9711 (1960).
17
E.g., H.R. 5948, 84th Cong. 1st Sess. (1955); S. 198, 85th Cong., 1st Sess. (1957); S. 722, 85th Cong., 1st Sess. (1957); see note 1, supra.
18
S.Rep. No. 196, 86th Cong., 1st Sess. 17 (1959): 'Time and again the Nation has suffered from the results of unregulated and uncontrolled competition in the field of banking, and from insufficiently regulated competition. * * * The rapid increase in the number of small weak banks, to such a large number that the Comptroller could not effectively supervise them or control any but the worst abuses was one of the factors which led to the panic of 1907.
'The banking collapse in the early 1930's again was in large part the result of insufficient regulation and control of banks, in effect the result of too much competition.' See also 105 Cong.Rec. 8076 (1959): 'But unlimited and unrestricted competition in banking is just not possible. We have had too many panics and banking crises and bank failures, largely as the result of excessive competition in banking, to consider for a moment going back to the days of free banking or unregulated banking.'
'Banking is too important to depositors, to borrowers, to the Government, and the public generally, to permit unregulated and unrestricted competition in that field.
19
See also S.Rep. No. 196, 86th Cong., 1st Sess. 16 (1959): 'But it is impossible to require unrestricted competition in the field of banking, and it would be impossible to subject banks to the rules applicable to ordinary industrial and commercial concerns, not subject to regulation and not vested with a public interest.'
20
For the pertinent text of the statute, see note 8 in the Court's opinion, ante, p. 332-333.
21
These factors are: 'the financial history and condition of each of the banks involved, the adequacy of its capital structure, its future earnings prospects, the general character of its management, the convenience and needs of the community to be served, and whether or not its corporate powers are consistent with the purposes of this chapter.' 12 U.S.C. (Supp. IV, 1963) § 1828(c). Compare § 6 of the Federal Deposit Insurance Act, 12 U.S.C. § 1816.
22
See also 106 Cong.Rec. 7259 (1960): 'The language of S. 1062 as amended by the House Banking and Currency Committee and as it appears in the bill we are now about to pass in the House makes it clear that the competitive and monopolistic factors are to be considered along with the banking factors and that after considering all of the factors involved, if the resulting institution will be in the public interest, then the application should be approved and otherwise disapproved.'
23
106 Cong.Rec. 7257 (1960): 'This puts the responsibility for acting on a proposed merger where it belongs—in the agency charged with supervising and examining the bank which will result from the merger. Out of their years of experience in supervising banks, our Federal banking agencies have developed specialized knowledge of banking and the people who engage in it. They are experts at judging the condition of the banks involved, their prospects, their management, and the needs of the community for banking services. They should have primary responsibility in deciding whether a proposed merger would be in the public interest.' (Emphasis added.)
24
H.R.Rep. No. 1416, 86th Cong., 2d Sess. 11—12 (1960): 'We are convinced, also, that approval of a merger should depend on a positive showing of some benefit to be derived from it. As previously indicated, your committee is not prepared to say that the cases enumerated in the hearings are the only instances in which a merger is in the public interest, nor are we prepared to devise a specific and exclusive list of situations in which a merger should be approved.'
25
Compare State Board of Ins. v. Todd Shipyards Corp., 370 U.S. 451, 457, 82 S.Ct. 1380, 1384, 8 L.Ed.2d 620, in which this Court refused to reconsider certain prior decisions because Congress had 'posited a regime of state regulation' of the insurance business on their continuing validity. Cf. Toolson v. New York Yankees, Inc., 346 U.S. 356, 74 S.Ct. 78, 98 L.Ed. 64.
26
If a bank merger such as this falls within the category of a 'stock' acquisition, a § 7 suit to enjoin it may be brought not only by the Attorney General, but by the Federal Reserve Board as well. See § 11 of the Clayton Act, 15 U.S.C. § 21 (vesting authority in the Board to enforce § 7 'where applicable to banks'). In an attempt to retain some semblance of the structure erected by Congress in the Bank Merger Act, the Court states that it 'supplanted * * * whatever authority the FRB may have acquired under § 11, by virtue of the amendment of § 7, to enforce § 7 against bank mergers.' Ante, p. 344, note 22. Sicne both the Attorney General and the Federal Reserve Board have purely advisory roles where a bank merger will result in a national bank, the Court's reasoning with respect to the effect of the Bank Merger Act upon enforcement authority should apply with equal force to both.
27
Indeed the Court has erected a simple yardstick in order to alleviate the agony of analyzing economic data—control of 30% of a commercial banking market is prohibited. Ante, pp. 363—364.
28
Although § 7 of the Clayton Act is applicable to an outright purchase of bank stock, this form of amalgamation is infrequently used in the banking field and does not involve divestiture problems of the same magnitude as does an asset acquisition.
29
It is true, as the Court points out (ante, p. 354), that Congress, in enacting the Bank Merger Act, agreed that the applicability of the Sherman Act to banking should not be disturbed. See, e.g., 105 Cong.Rec. 8076 (1959). But surely this alone provides no conceivable justification for applying the Clayton Act as well. Apart from the fact that the Sherman Act covers many kinds of restraints besides mergers, one of the sponsors of the Bank Merger Act (Senator Fulbright) expressed his expectation that in a Sherman Act case a bank merger would not be subjected to strict antitrust standards to the exclusion of all other considerations: 'And even if the Sherman Act is held to apply to banking and to bank mergers, it seems clear that under the rule of reason spelled out in the Standard Oil case, different considerations will be found applicable, in a regulated field like banking, in determining whether activities would 'unduly diminish competition,' in the words of the Supreme Court in that case.' 106 Cong.Rec. 9711 (1960). Moreover, this Court has recognized in other areas that it may be necessary to accommodate the Sherman Act to regulatory policy. McLean Trucking Co. v. United States, 321 U.S. 67, 83, 64 S.Ct. 370, 382—383, 88 L.Ed. 544; Federal Communications Comm'n v. RCA Communications, Inc., 346 U.S. 86, 91 92, 73 S.Ct. 998, 1002—1003, 97 L.Ed. 1470. See also United States v. Columbia Steel Co., 334 U.S. 495, 527, 68 S.Ct. 1107, 1124, 92 L.Ed. 1533. And of course the Sherman Act is concerned more with existing anti-competitive effects than with future probabilities, and thus would not reach incipient restraints to the same extent as would § 7 of the Clayton Act. See Brown Shoe Co. v. United States, 370 U.S. 294, 317—318 and notes 32, 33, 82 S.Ct. 1502, 1519—1520, 8 L.Ed.2d 510.
30
In these respects a merger is precisely the contrary of what § 7 was originally designed to proscribe—the secret acquisition of corporate control. See the Court's opinion, ante, p. 338.
31
That the stock-acquisition provision was not intended to cover mergers is strongly suggested by the second paragraph of § 7: 'No corporation shall acquire * * * any part of the stock * * * of one or more corporations * * * where * * * the effect * * * of the use of such stock by the voting or granting of proxies * * * may be substantially to lessen competition, or to tend to create a monopoly.' 15 U.S.C. § 18. (Emphasis added.) After a merger has been consummated, the resulting corporation holds no stock in any party to the merger; thus there can be in this situation no such thing as a restraint of trade by 'the use' of the voting power of acquired stock.
32
On this point, the dissenters agreed: 'It is true that the Clayton Act does not forbid corporate mergers * * *.' 291 U.S., at 600, 54 S.Ct., at 538, 78 L.Ed. 1007. See also United States v. Celanese Corp. of America, D.C., 91 F.Supp. 14.
33
See also Hearings on H.R. 988, H.R. 1240, H.R. 2006, H.R. 2734 before Subcommittee No. 3 of the House Committee on the Judiciary, 81st Cong., 1st Sess. 38—39 (1949); Hearings on H.R. 2734 before a Subcommittee of the Senate Committee on the Judiciary, 81st Cong., 1st & 2d Sess. 109—110 (1950): 'The loophole sought to be filled resulted from a series of Supreme Court decisions. (Swift & Co. v. F.T.C. and Thatcher Mfg. Co. v. F.T.C., 272 U.S. 554, 47 S.Ct. 175, 71 L.Ed. 405; Arrow-Hart & Hegeman Co. v. F.T.C., 291 U.S. 587, 54 S.Ct. 532, 78 L.Ed. 1007.) In these decisions the Supreme Court held that section 7 of the Clayton Act, while prohibiting the acquisition of stock of a competitor, gave the Federal Trade Commission no authority under section 11 to order divestiture of assets which had been acquired before a cease-and-desist order was issued, even though the acquisition resulted from the voting of illegally held stock.'
34
The Federal Trade Commission had assumed primary enforcement responsibility before the 1950 amendment. See Martin, Mergers and the Clayton Act (1959), p. 197.
35
Compare note 26, supra.
36
See note 33 supra; Hearings on H.R. 2734 before a Subcommittee of the Senate Committee on the Judiciary, 81st Cong., 1st & 2d Sess. 97 (1950). And this Court has, after the 1950 amendment, described Arrow as a case involving an asset acquisition. Brown Shoe Co. v. United States, 370 U.S. 294, 313 and note 20, 82 S.Ct. 1502, 1517, 8 L.Ed.2d 510.
37
The single excerpt quoted by the Court (ante, p. 345) casts no doubt on this proposition, for Senator Kilgore's remark occurred in the course of a discussion in which he was trying to make the point that there is no difference in practical effect, as opposed to the legal distinction, between a merger and a stock acquisition. Thus at the end of the paragraph quoted by the Court the Senator stated: '* * * I cannot see how on earth you can get the idea that the purchase of the stock of the corporation, all of it, does not carry with it the transfer of all of the physical assets in that corporation.' Hearings on H.R. 2734 before a Subcommittee of the Senate Committee on the Judiciary, 81st Cong., 1st & 2d Sess. 176 (1950).
38
H.R.Rep. No. 1191, 81st Cong., 1st Sess. 2 (1949).
39
Federal Trade Commission, The Merger Movement: A Summary Report (1948), passim.
40
E.g., Hearings on H.R. 988, H.R. 1240, H.R. 2006, H.R. 2734 before Subcommittee No. 3 of the House Committee on the Judiciary, 81st Cong., 1st Sess. 39—40 (1949); 95 Cong.Rec. 11503 (1949); 96 Cong.Rec. 16505 (1950).
41
Hearings on H.R. 2734 before a Subcommittee of the Senate Committee on the Judiciary, 81st Cong., 1st & 2d Sess. 5—6, 17, 57 59 (1950); Hearings on H.R. 988, H.R. 1240, H.R. 2006, H.R. 2734 before Subcommittee No. 3 of the House Committee on the Judiciary, 81st Cong., 1st Sess. 40, 113 (1949).
42
S.Rep. No. 1775, 81st Cong., 2d Sess. 3 (1950); H.R.Rep. No. 1191, 81st Cong., 1st Sess. 2—3 (1949).
43
It is interesting to note that in the same year in which § 7 was amended Congress passed an act faciliating certain kinds of bank mergers which had theretofore been prohibited. See note 11, supra, and accompanying text.
44
Since the Court does not reach the Sherman Act aspect of this case, it would serve no useful purpose for me to do so.
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|
374 U.S. 167
83 S.Ct. 1815
10 L.Ed.2d 818
H. W. MOSELEY, doing business as Moseley Plumbing and Heating Company, Petitioner,v.ELECTRONIC & MISSILE FACILITIES, INC., et al.
No. 401.
Argued April 16 and 17, 1963.
Decided June 17, 1963.
George C. Grant, Macon, Ga., for petitioner.
Newell Edenfield, Atlanta, Ga., for respondents.
Mr. Justice CLARK delivered the opinion of the Court.
1
The primary issue in this case is whether a claim under the Miller Act, 40 U.S.C. §§ 270a—270d, as amended, based upon arbitration clauses in two subcontracts providing for arbitration of any dispute arising thereunder, is enforceable under the provisions of the United States Arbitration Act. 9 U.S.C. §§ 1, 2 and 3. The institution of this suit was directed toward the recovery of compensation alleged to be due under two subcontracts between the petitioner, a plumbing and heating contractor, and the respondent Electronic & Missile Facilities, Inc., who was the prime contractor under a contract with the United States Corps of Engineers, Savannah District, covering certain Nike Hercules missile installations at Robins Air Force Base Defense Area and Turner Air Force Base Defense Area, both of which are located in the State of Georgia. The subcontracts provided for arbitration in New York, and, disputes having arisen thereunder, the respondent filed suit in the Supreme Court of New York seeking an order directing arbitration in accordance with the arbitration provisions. Petitioner then filed this suit in the Middle District of Georgia, where the work under the subcontracts was performed, seeking (1) recovery of the amounts alleged to be due under the subcontracts; (2) rescission of the subcontracts—on grounds of fraud—and recovery on a quantum meruit basis; (3) in the alternative, failing in both of these claims, recovery of the reasonable value of the labor and materials furnished; and (4) an injunction enjoining the respondent from proceeding with its arbitration efforts in New York. Neither party sought to compel specific performance of the arbitration agreement. The District Court, holding (1) that the Miller Act gave petitioner the right to sue in the District Court where the subcontracts were performed and (2) that the arbitration clause, if induced by fraud on the part of respondent, would be vitiated, made permanent its prior restraining order directed at the arbitration proceedings in New York. The Court of Appeals reversed, holding that petitioner must arbitrate in New York under New York law. 306 F.2d 554. We granted certiorari. 371 U.S. 919, 83 S.Ct. 287, 9 L.Ed.2d 228. Petitioner attacks the subcontracts, as well as the arbitration agreement, as being fraudulent, and this issue, we conclude, must be first determined by the District Court. We therefore reverse the judgment and remand the case to the Court of Appeals with directions to remand to the District Court for further proceedings not inconsistent with this opinion.
I.
2
We need not elaborate at length on the involved factual situation since it is detailed in the opinions of the Court of Appeals and the District Court. As we have said, petitioner filed suit in the United States District Court for the Middle District of Georgia, the district in which the subcontracts were performed, alleging breach of contract for refusal to pay and seeking recovery for work which had been performed and, alternatively, rescission of the subcontracts on grounds of fraud. The suit was brought under the provisions of the Miller Act, which provides in pertinent part:
3
'Every suit instituted under this section shall be brought in the name of the United States for the use of the person suing, in the United States District Court for any district in which the contract was to be performed and executed and not elsewhere, irrespective of the amount in controversy * * *.' 40 U.S.C. § 270b(b).
4
It further provides that parties included within the Act 'shall have the right to sue * * * and to prosecute said action to final execution and judgment * * *.' Id., at § 270b(a). Respondent moved to dismiss the suit or stay the same so that the New York arbitration suit might proceed under the terms of both subcontracts, each of which provided that '(a)ny controversy or claim arising out of or relating to' the subcontracts or their breach would be submitted to arbitration in New York City under New York law. In denying these motions the District Court held that the Arbitration Act did not apply here since any other holding would nullify the provisions of the Miller Act. It also concluded that the allegations of fraud, if sustained, would, under Georgia law, rescind the subcontracts, including the agreement for arbitration.
5
The Court of Appeals, with one judge dissenting, reversed on the theory that the Miller Act was not enacted for the benefit of plaintiffs in the selection of a forum, but rather for the convenience of the defendant, and that this is the type of dispute that is and should be subject to arbitration. As to the issue of fraud, it held that federal law controls in determining whether an allegation of fraud precludes arbitration of a dispute arising under the subcontracts and concluded that, in order to bar arbitration under federal law, the allegation of fraud must be specifically directed to the arbitration clause rather than to the entire contract. Thus, it reversed the District Court on both points.
II.
6
At the outset we note, as we have indicated, that no request has been made here for the enforcement of the arbitration agreement included within the subcontracts. Indeed, the petitioner has attacked not only the subcontracts, but also the arbitration clauses contained therein, as having been procured through fraud. With the pleadings in this posture, we are obliged to pass upon the priority in determination of that issue in the trial of the case. In essence, petitioner alleges that the subcontracts with him, as well as other subcontractors, were a fraudulent scheme to obtain a great amount of work and material from petitioner and the other subcontractors without making payment therefor and to 'browbeat' petitioner and his fellow subcontractors into accepting much less than the value of their claims. One of the means used to effect such scheme was alleged to be the insertion in the subcontracts of an arbitration clause requiring arbitration of disputes in New York. Under either the Miller Act or the Arbitration Act, it seems clear that the issue of fraud should first be adjudicated before the rights of the parties under the subcontracts can be determined. It appears necessary, therefore, that the District Court proceed first to trial of this issue. In considering the question of the sufficiency of the pleadings with reference to the allegation of fraud, we believe that, as alleged here, the issue goes to the arbitration clause itself, since it is contended that it was to be used to effect the fraudulent scheme. If this issue is determined favorably to the petitioner, there can be no arbitration under the subcontracts.
7
In view of our holding here, it is not necessary to reach the issues relating to arbitrability of disputes arising under these subcontracts. In fact, disposition of the fraud issue may dispose of the entire suit. In the event the fraud issue is decided favorably to the respondent, and the United States District Court for the Middle District of Georgia should be called upon to decide the question of arbitrability of such disputes and related problems in Miller Act cases, its decision on that point would then, of course, be subject to review.
8
We therefore reverse the judgment of the Court of Appeals and remand the case to it with instructions that it remand the same to the District Court for further proceedings not inconsistent with this opinion.
9
It is so ordered.
10
Judgment of Court of Appeals reversed and case remanded with instructions.
11
Mr. Justice STEWART would affirm the judgment substantially for the reasons stated in Chief Judge Tuttle's opinion for the Court of Appeals. 306 F.2d 554.
12
THE CHIEF JUSTICE and Mr. Justice BLACK, concurring.
13
We agree with the Court that fraud in the procurement of an arbitration contract, like fraud in the procurement of any contract, makes it void and unenforceable and that this question of fraud is a judicial one, which must be determined by a court. To allow this question to be decided by arbitrators would be to that extent to enforce the arbitration agreement even though steeped in the grossest kind of fraud. Compare Robert Lawrence Co. v. Devonshire Fabrics, 271 F.2d 402 (C.A.2d Cir. 1959). For this reason we acquiesce in the Court's present disposition of the case on this single issue. But we point out that this disposition leaves open questions of great importance to laborers and materialmen who under the Miller Act are entitled to have their controversies settled in independent courts of law:
14
(1) Can a member of the special class of laborers and materialmen which Congress, in the public interest, has protected by fixing the venue for their claims under the Miller Act in a particular federal court deprive himself of that kind of remedy as a condition of his obtaining the employment or the purchase of his materials?
15
(2) Can any person, before any dispute has arisen, agree to arbitrate all future disputes he may have and thereby lose his right to go into court to try his claim according to due process of law?
16
(3) Can the Arbitration Act, in light of its language and legislative history, be applied to laborers and materialmen or to construction projects subject to the Miller Act?
17
(4) Is a construction project, like the one in this case, one 'involving commerce' so as to come within the restricted scope of the Arbitration Act?
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|
374 U.S. 449
83 S.Ct. 1804
10 L.Ed.2d 1000
George K. ROSENBERG, District Director, Immigration and Naturalization Service, Petitioner,v.George FLEUTI.
No. 248.
Argued March 26, 1963.
Decided June 17, 1963.
Philip R. Monahan, Washington, D.C., for petitioner.
Hirman W. Kwan, Los Angeles, Cal., for respondent.
Mr. Justice GOLDBERG delivered the opinion of the Court.
1
Respondent Fleuti is a Swiss national who was originally admitted to this country for permanent residence on October 9, 1952, and has been here continuously since except for a visit of 'about a couple hours' duration to Ensenada, Mexico, in August 1956. The Immigration and Naturalization Service, of which petitioner Rosenberg is the Los Angeles District Director, sought in April 1959 to deport respondent on the ground that at the time of his return in 1956 he 'was within one or more of the classes of aliens excludable by the law existing at the time of such entry,' Immigration and Nationality Act of 1952, § 241(a)(1), 66 Stat. 204, 8 U.S.C. § 1251(a)(1). In particular, the Service alleged that respondent had been 'convicted of a crime involving moral turpitude,' § 212(a)(9), 66 Stat. 182, 8 U.S.C. § 1182(a)(9), before his 1956 return, and had for that reason been excludable when he came back from his brief trip to Mexico. A deportation order issued on that ground, but it was discovered a few months later that the order was invalid, because the crime was a petty offense not of the magnitude encompassed within the statute. The deportation proceedings were thereupon reopened and a new charge was lodged against respondent: that he had been excludable at the time of his 1956 return as an alien 'afflicted with psychopathic personality,' § 212(a)(4), 66 Stat. 182, 8 U.S.C. § 1182(a)(4), by reason of the fact that he was a homosexual. Deportation was ordered on this ground and Fleuti's appeal to the Board of Immigration Appeals was dismissed, whereupon he brought the present action for declaratory judgment and review of the administrative action. It was stipulated that among the issues to be litigated was the question whether § 212(a)(4) is 'unconstitutional as being vague and ambiguous.' The trial court rejected respondent's contentions in this regard and in general, and granted the Government's motion for summary judgment. On appeal, however, the United States Court of Appeals for the Ninth Circuit set aside the deportation order and enjoined its enforcement, holding that as applied to Fleuti § 212(a)(4) was unconstitutionally vague in that homosexuality was not sufficiently encompassed within the term 'psychopathic personality.' 302 F.2d 652.
2
The Government petitioned this Court for certiorari, which we granted in order to consider the constitutionality of § 212(a)(4) as applied to respondent Fleuti. 371 U.S. 859, 83 S.Ct. 117, 9 L.Ed.2d 97. Upon consideration of the case, however, and in accordance with the long-established principle that 'we ought not to pass on questions of constitutionality * * * unless such adjudication is unavoidable,' Spector Motor Service, Inc., v. McLaughlin, 323 U.S. 101, 105, 65 S.Ct. 152, 154, 89 L.Ed. 101; see also Alma Motor Co. v. Timken-Detroit Axle Co., 329 U.S. 129, 67 S.Ct. 231, 91 L.Ed. 128; Neese v. Southern R. Co., 350 U.S. 77, 76 S.Ct. 131, 100 L.Ed. 60; Mackey v. Mendoza-Martinez, 362 U.S. 384, 80 S.Ct. 785, 4 L.Ed.2d 812; we have concluded that there is a threshold issue of statutory interpretation in the case, the existence of which obviates decision here as to whether § 212(a)(4) is constitutional as applied to respondent.
3
That issue is whether Fleuti's return to the United States from his afternoon trip to Ensenada, Mexico, in August 1956 constituted an 'entry' within the meaning of § 101(a)(13) of the Immigration and Nationality Act of 1952, 66 Stat. 167, 8 U.S.C. § 1101(a)(13), such that Fleuti was excludable for a condition existing at that time even though he had been permanently and continuously resident in this country for nearly four years prior thereto. Section 101(a)(13), which has never been directly construed by this Court in relation to the kind of brief absence from the country that characterizes the present case,1 reads as follows:
4
The question we must consider, more specifically, is whether Fleuti's short visit to Mexico can possibly be regarded as a 'departure to a foreign port or place * * * (that) was not intended,' within the meaning of the exception to the term 'entry' created by the statute. Whether the 1956 return was within that exception is crucial, because Fleuti concededly was not excludable as a 'psychopathic personality' at the time of his 1952 entry.2
5
The definition of 'entry' as applied for various purposes in our immigration laws was evolved judicially, only becoming encased in statutory form with the inclusion of § 101(a)(13) in the 1952 Act. In the early cases there was developed a judicial definition of 'entry' which had harsh consequences for aliens. This viewpoint was expressed most restrictively in United States ex rel. Volpe v. Smith, 289 U.S. 422, 53 S.Ct. 665, 77 L.Ed. 1468, in which the Court, speaking through Mr. Justice McReynolds, upheld deportation of an alien who, after 24 years of residence in this country following a lawful entry, was held to be excludable on his return from 'a brief visit to Cuba,' id., at 423, 53 S.Ct. at 666. The Court stated that 'the word 'entry' * * * includes any coming of an alien from a foreign country into the United States whether such coming be the first or any subsequent one.' Id., at 425, 53 S.Ct. at 667.3 Although cases in the lower courts applying
6
the strict re-entry doctrine to aliens who had left the country for brief visits to Canada or Mexico or elsewhere were numerous,4 many courts applied the doctrine in such instances with express reluctance and explicit recognition of its harsh consequences,5 and there were a few instances in which district judges refused to hold that aliens who had been absent from the country only briefly had made 'entries' upon their return.6
7
Reaction to the severe effects produced by adherence to the strict definition of 'entry' resulted in a substantial inroad being made upon that definition in 1947 by a decision of the Second Circuit and a decision of this Court. The Second Circuit, in an opinion by Judge Learned Hand, refused to allow a deportation which depended on the alien's being regarded as having re-entered this country after having taken an overnight sleeper from Buffalo to Detroit on a route lying through Canada. Di Pasquale v. Karnuth, 158 F.2d 878. Judge Hand recognized that the alien ' acquiesced in whatever route the railroad might choose to pull the car,' id., at 879, but held that it would be too harsh to impute the carrier's intent to the alien, there being no showing that the alien knew he would be entering Canada. 'Were it otherwise,' Judge Hand went on, 'the alien would be subjected without means of protecting himself to the forfeiture of privileges which may be, and often are, of the most grave importance to him.' Ibid. If there were a duty upon aliens to inquire about a carrier's route, it 'would in practice become a trap, whose closing upon them would have no rational relation to anything they could foresee as significant. We cannot believe that Congress meant to subject those who had acquired a residence, to the sport of chance, when the interests at stake may be so momentous.' Ibid. Concluding, Judge Hand said that if the alien's return were held to be an 'entry' under the circumstances, his 'vested interest in his residence' would
8
'be forfeited because of perfectly lawful conduct which he could not possibly have supposed would result in anything of the sort. Caprice in the incidence of punishment is one of the indicia of tyranny, and nothing can be more disingenuous than to say that deportation in these circumstances is not punishment. It is well that we should be free to rid ourselves of those who abuse our hospitality; but it is more important that the continued enjoyment of that hospitality once granted, shall not be subject to meaningless and irrational hazards.' Ibid.
9
Later the same year this Court, because of a conflict between Di Pasquale and Del Guercio v. Delgadillo, 159 F.2d 130 (C.A.9th Cir. 1947), granted certiorari in the latter case and reversed a deportation order affecting an alien who, upon rescue after his intercoastal merchant ship was torpedoed in the Caribbean during World War II, had been taken to Cuba to recuperate for a week before returning to this country. Delgadillo v. Carmichael, 332 U.S. 388, 68 S.Ct. 10, 92 L.Ed. 17. The Court pointed out that it was 'the exigencies of war, not his voluntary act,' id., at 391, 68 S.Ct. at 12, which put the alien on foreign soil, adding that '(w)e might as well hold that if he had been kidnapped and taken to Cuba, he made a statutory 'entry' on his voluntary return. Respect for law does not thrive on captious interpretations.' Ibid. Since '(t)he stakes are indeed high and momentous for the alien who has acquired his residence here,' ibid., the Court held that
10
'(w)e will not attribute to Congress a purpose to make his right to remain here dependent on circumstances so fortuitous and capricious as those upon which the Immigration Service has here seized. The hazards to which we are now asked to subject the alien are too irrational to square with the statutory scheme.' Ibid.
11
The increased protection of returning resident aliens which was brought about by the Delgadillo decision, both in its result and in its express approval of Di Pasquale, was reflected in at least two subsequent lower-court decisions prior to the enactment of § 101(a)(13). In Yukio Chai v. Bonham, 165 F.2d 207 (C.A.9th Cir. 1947), the court held that no 'entry' had occurred after a ship carrying a resident alien back from seasonal cannery work in Alaska made an unscheduled stop in Vancouver, B.C., and in Carmichael v. Delaney, 170 F.2d 239 (C.A.9th Cir. 1948), the court held that a resident alien returning from wartime service with the United States Maritime Service during which he had stopped at many foreign ports made no 'entry' because all of the movements of the ship to which he had been assigned were pursuant to Navy orders.7
12
It was in light of all of these developments in the case law that § 101(a)(13) was included in the immigration laws with the 1952 revision. As the House and Senate Committee Reports, the relevant material from which is quoted in the margin,8 make clear, the major congressional concern in codifying the definition of 'entry' was with 'the status of an alien who has previously entered the United States and resided therein * * *.' This concern was in the direction of ameliorating the harsh results visited upon resident aliens by the rule of United States ex rel. Volpe v. Smith, supra, as is indicated by the recognition that 'the courts have departed from the rigidity of (the earlier) rule,' and the statement that '(t)he bill (gives) due recognition to the judicial precedents.' It must be recognized, of course, that the only liberalizing decisions to which the Reports referred specifically were Di Pasquale and Delgadillo, and that there is no indication one way or the other in the legislative history of what Congress thought about the problem of resident aliens who leave the country for insignificantly short periods of time. Nevertheless, it requires but brief consideration of the policies underlying § 101(a)(13), and of certain other aspects of the rights of returning resident aliens, to conclude that Congress, in approving the judicial undermining of Volpe, supra, and the relief brought about by the Di Pasquale and Delgadillo decisions, could not have meant to limit the meaning of the exceptions it created in § 101(a)(13) to the facts of those two cases.
13
The most basic guide to congressional intent as to the reach of the exceptions is the eloquent language of Di Pasquale and Delgadillo themselves, beginning with the recognition that the 'interests at stake' for the resident alien are 'momentous,' 158 F.2d, at 879, and that '(t)he stakes are indeed high and momentous for the alien who has acquired his residence here,' 332 U.S., at 391, 68 S.Ct. at 12. This general premise of the two decisions impelled the more general conclusion that 'it is * * * important that the continued enjoyment of (our) hospitality once granted, shall not be subject to meaningless and irrational hazards.' 158 F.2d, at 879. See also Delgadillo, supra, at 391, 68 S.Ct. at 12. Coupling these essential principles of the two decisions explicitly approved by Congress in enacting § 101(a)(13) with the more general observation, appearing in Delgadillo as well as elsewhere,9 that '(d) eportation can be the equivalent of banishment or exile,' it is difficult to conceive that Congress meant its approval of the liberalization wrought by Di Pasquale and Delgadillo to be interpreted mechanistically to apply only to cases presenting factual situations identical to what was involved in those two decisions.
14
The idea that the exceptions to § 101(a)(13) should be read nonrestrictively is given additional credence by the way in which the immigration laws define what constitutes 'continuous residence' for an alien wishing to be naturalized. Section 316 of the 1952 Act, 66 Stat. 242—243, 8 U.S.C. § 1427, which liberalized previous law in some respects, provides that an alien who wishes to seek naturalization does not begin to endanger the five years of 'continuous residence' in this country which must precede his application until he remains outside the country for six months, and does not damage his position by cumulative temporary absences unless they total over half of the five years preceding the filing of his petition for naturalization. This enlightened concept of what constitutes a meaningful interruption of the continuous residence which must support a petition for naturalization, reflecting as it does a congressional judgment that an alien's status is not necessarily to be endangered by his absence from the country, strengthens the foundation underlying a belief that the exceptions to § 101(a)(13) should be read to protect resident aliens who are only briefly absent from the country. Of further, although less specific, effect in this regard is this Court's holding in Kwong Hai Chew v. Colding, 344 U.S. 590, 73 S.Ct. 472, 97 L.Ed. 576, that the returning resident alien is entitled as a matter of due process to a hearing on the charges underlying any attempt to exclude him, a holding which supports the general proposition that a resident alien who leaves this country is to be regarded as retaining certain basic rights.
15
Given that the congressional protection of returning resident aliens in § 101(a)(13) is not to be woodenly construed, we turn specifically to construction of the exceptions contained in that section as they relate to resident aliens who leave the country briefly. What we face here is another harsh consequence of the strict 'entry' doctrine which, while not governed directly by Delgadillo, nevertheless calls into play the same considerations, pp. 454-456, 458-459, supra, which led to the results specifically approved in the Congressional Committee Reports. It would be as 'fortuitous and capricious,' and as 'irrational to square with the statutory scheme,' Delgadillo, supra, at 391, to hold that an alien may necessarily be deported because he falls into one of the classes enumerated in § 212(a) when he returns from 'a couple hours' visit to Mexico as it would have been to uphold the order of deportation in Delgadillo. Certainly when an alien like Fleuti who has entered the country lawfully and has acquired a residence here steps across a border and, in effect, steps right back, subjecting him to exclusion for a condition, for which he could not have been deported had he remained in the country seems to be placing him at the mercy of the 'sport of chance' and the 'meaningless and irrational hazards' to which Judge Hand alluded. Di Pasquale, supra, at 879, of 158 F.2d. In making such a casual trip the alien would seldom be aware that he was possibly walking into a trap, for the insignificance of a brief trip to Mexico or Canada bears little rational relation to the punitive consequence of subsequent excludability. There are, of course, valid policy reasons for saying that an alien wishing to retain his classification as a permanent resident of this country imperils his status by interrupting his residence too frequently or for an overly long period of time, but we discern no rational policy supporting application of a re-entry limitation in all cases in which a resident alien crosses an international border for a short visit.10 Certainly if that trip is innocent, casual, and brief, it is consistent with all the discernible signs of congressional purpose to hold that the 'departure * * * was not intended' within the meaning and ameliorative intent of the exception of § 101(a)(13). Congress unquestionably has the power to exclude all classes of undesirable aliens from this country, and the courts are charged with enforcing such exclusion when Congress has directed it, but we do not think Congress intended to exclude aliens long resident in this country after lawful entry who have merely stepped across an international border and returned in 'about a couple hours.' Such a holding would be inconsistent with the general purpose of Congress in enacting § 101(a)(13) to ameliorate the severe effects of the strict 'entry' doctrine.
16
We conclude, then, that it effectuates congressional purpose to construe the intent exception to § 101(a)(13) as meaning an intent to depart in a manner which can be regarded as meaningfully interruptive of the alien's permanent residence. One major factor relevant to whether such intent can be inferred is, of course, the length of time the alien is absent. Another is the purpose of the visit, for if the purpose of leaving the country is to accomplish some object which is itself contrary to some policy reflected in our immigration laws, it would appear that the interruption of residence thereby occurring would properly be regarded as meaningful. Still another is whether the alien has to procure any travel documents in order to make his trip, since the need to obtain such items might well cause the alien to consider more fully the implications involved in his leaving the country. Although the operation of these and other possibly relevant factors remains to be developed 'by the gradual process of judicial inclusion and exclusion,' Davidson v. New Orleans, 96 U.S. 97, 104, 24 L.Ed. 616, we declare today simply that an innocent, casual, and brief excursion by a resident alien outside this country's borders may not have been 'intended' as a departure disruptive of his resident alien status and therefore may not subject him to the consequences of an 'entry' into the country on his return. The more civilized application of our immigration laws given recognition by Congress in § 101(a)(13) and other provisions of the 1952 Act protects the resident alien from unsuspected risks and unintended consequences of such a wholly innocent action. Respondent here, so far as appears from the record, is among those to be protected. However, because attention was not previously focused upon the application of § 101(a)(13) to the case, the record contains no detailed description or characterization of his trip to Mexico in 1956, except for his testimony that he was gone 'about a couple hours,' and that he was 'just visiting; taking a trip.' That being the case, we deem it appropriate to remand the case for further consideration of the application of § 101(a)(13) to this case in light of our discussion herein. If it is determined that respondent did not 'intend' to depart in the sense contemplated by § 101(a)(13), the deportation order will not stand and adjudication of the constitutional issue reached by the court below will be obviated. The judgment of the Court of Appeals is therefore vacated and the case remanded with directions that the parties be given leave to amend their pleadings to put in issue the question of 'entry' in accordance with the foregoing, and for further proceedings consistent herewith. So ordered.
17
Judgment vacated and case remanded with directions.
18
Mr. Justice CLARK, with whom Mr. Justice HARLAN, Mr. Justice STEWART and Mr. Justice WHITE join, dissenting.
19
I dissent from the Court's judgment and opinion because 'statutory construction' means to me that the Court can construe statutes but not that it can construct them. The latter function is reserved to the Congress, which clearly said what it meant and undoubtedly meant what it said when it defined 'entry' for immigration purposes as follows:
20
'The term 'entry' means any coming of an alien into the United States, from a foreign port or place or from an outlying possession, whether voluntarily or otherwise, except that an alien having a lawful permanent residence in the United States shall not be regarded as making an entry into the United States for the purposes of the immigration laws if the alien proves to the satisfaction of the Attorney General that his departure to a foreign port or place or to an outlying possession was not intended or reasonably to be expected by him or his presence in a foreign port or place or in an outlying possession was not voluntary * * *.' 8 U.S.C. § 1101(a)(13).
21
That this definition of 'entry' includes the respondent's entry after his brief trip to Mexico in 1956 is a conclusion which seems to me inescapable. The conclusion is compelled by the plain meaning of the statute, its legislative history, and the consistent interpretation by the federal courts. Indeed, the respondent himself did not even question that his return to the United States was an 'entry' within the meaning of § 101(a)(13). Nonetheless, the Court has rewritten the Act sua sponte, creating a definition of 'entry' which was suggested by many organizations during the hearings prior to its enactment but which was rejected by the Congress. I believe the authorities discussed in the Court's opinion demonstrate that 'entry' as defined in § 101(a)(13) cannot mean what the Court says it means, but I will add a few words of explanation.
22
The word 'entry' had acquired a well-defined meaning for immigration purposes at the time the Immigration and Nationality Act was passed in 1952. The leading case was United States ex rel. Volpe v. Smith, 289 U.S. 422, 53 S.Ct. 665, 77 L.Ed. 1468 (1933), which held that an alien who had resided continuously in the United States for 26 years except for a brief visit to Cuba made an 'entry' at the time of his return from Cuba. The Court there stated that the word 'entry' in the Immigration Act of 1917 'includes any coming of an alien from a foreign country into the United States whether such coming be the first or any subsequent one.' Id., at 425, 53 S.Ct. 667, 77 L.Ed. 1468. That conclusion was based on sound authority, since the Court had earlier held that a resident alien who crossed the river from Detroit to Windsor, Canada, and returned on the same day made an entry upon his return. Lewis v. Frick, 233 U.S. 291, 34 S.Ct. 488, 58 L.Ed. 967 (1914).
23
The federal courts in numerous cases were called upon to apply this definition of 'entry' and did so consistently, specifically recognizing that the brevity of one's stay outside the country was immaterial to the question of whether his return was an 'entry'. See, e.g., United States ex rel. Kowalenski v. Flynn, 17 F.2d 524 (D.C.W.D.N.Y.1927); Schoeps v. Carmichael, 177 F.2d 391 (C.A.9th Cir. 1949). A related but obviously distinguishable question did create difficulties for the courts, however, leading to conflicting opinions among the Circuits as to whether a resident alien makes an 'entry' when he had no intent to leave the country or did not leave voluntarily. It was decided by this Court in Delgadillo v. Carmichael, 332 U.S. 388, 68 S.Ct. 10, 92 L.Ed. 17 (1947), which held that an alien whose ship had been torpedoed and sunk, after which he was rescued and taken to Cuba for a week, did not make an 'entry' on his return to the United States. The Court discussed the Volpe case but distinguished it and others on the ground that 'those were cases where the alien plainly expected or planned to enter a foreign port or place. Here he was catapulted into the ocean, rescued, and taken to Cuba. He had no part in selecting the foreign port as his destination.' Id., at 390, 68 S.Ct. at 12. The Court specifically relied on Di Pasquale v. Karnuth, 158 F.2d 878 (C.A.2d Cir. 1947), where an alien who had ridden a sleeping car from Buffalo to Detroit, without knowledge that the train's route was through Canada, was held not to have made an 'entry' upon his arrival in Detroit.
24
These cases and others discussed by the Court establish the setting in which the Immigration and Nationality Act was passed in 1952. The House and Senate reports quoted by the Court show that the Congress recognized the courts' difficulty with the rule that 'any coming of an alien into the United States was an 'entry,' even when the departure from the country was unintentional or involuntary. The reports discuss the broad rule of the Volpe case and the specific limitations of the Di Pasquale and Delgadillo cases, citing those cases by name, and conclude with the following language:
25
'The bill defines the term 'entry' as precisely as practicable, giving due recognition to the judicial precedents. Thus any coming of an alien from a foreign port or place or an outlying possession into the United States is to be considered an entry, whether voluntary or otherwise, unless the Attorney General is satisfied that the departure of the alien, other than a deportee, from this country was unintentional or was not voluntary.' H.R.Rep.No.1365, 82d Cong., 2d Sess. 32; S.Rep.No. 1137, 82d Cong., 2d Sess. 4; U.S. Congressional and Administrative News 1952, p. 1684.
26
Thus there is nothing in the legislative history or in the statute itself which would exempt the respondent's return from Mexico from the definition of 'entry'. Rather, the statute in retaining the definition expressed in Volpe seems clearly to cover respondent's entry, which occurred after he knowingly left the United States in order to travel to a city in Mexico. That the trip may have been 'innocent, casual, and brief' does not alter the fact that, in the words of the Court in Delgadillo, the respondent 'plainly expected or planned to enter a foreign port or place.' 332 U.S., at 390, 68 S.Ct. at 12.
27
It is true that this application of the law to a resident alien may be harsh, but harshness is a far cry from the irrationality condemned in Delgadillo, supra, 332 U.S. at 391, 68 .s.Ct. at 12. There and in Di Pasquale contrary results would have meant that a resident alien, who was not deportable unless he left the country and reentered, could be deported as a result of circumstances either beyond his control or beyond his knowledge. Here, of course, there is no claim that respondent did not know he was leaving the country to enter Mexico and, since one is presumed to know the law, he knew that his brief trip and reentry would render him deportable. The Congress clearly has chosen so to apply the long-established definition, and this Court cannot alter that legislative determination in the guise of statutory construction. Had the Congress not wished the definition of 'entry' to include a return after a brief but voluntary and intentional trip, it could have done so. The Court's discussion of § 316 of the Act shows that the Congress knows well how to temper rigidity when it wishes. Nor can it be said that the Congress was unaware of the breadth of its definition. Even aside from the evidence that it was aware of the judicial precedents, numerous organizations unsuccessfully urged that the definition be narrowed to accomplish what the Court does today. Thus, it was urged that the Act's definition of 'entry' 'should, we believe, be narrowed so that it will not be applicable to an alien returning from abroad, after a temporary absence, to an unrelinquished domicile here.'1 Other groups complained also that '(t)he term 'entry' is defined to mean any coming of an alien into the United States. It is recommended that this be narrowed to provide that a return, after a temporary absence, to an unrelinquished domicile, shall not constitute a new entry.'2 Despite such urging, however, the Congress made no change in the definition. Further, this Court in 1958 specifically recognized that the word 'entry' retained its plain meaning, stating that 'a resident alien who leaves the country for any period, however brief, does make a new entry on his return * * *.' Bonetti v. Rogers, 356 U.S. 691, 698, 78 S.Ct. 976, 980, 2 L.Ed.2d 1087.
28
All this to the contrary notwithstanding, the Court today decides that one does not really intend to leave the country unless he plans a long trip, or his journey is for an illegal purpose, or he needs travel documents in order to make the trip. This is clearly contrary to the definition in the Act and to any definition of 'intent' that I was taught.3
29
What the Court should do is proceed to the only question which either party sought to resolve: whether the deportation order deprived respondent of due process of law in that the term 'afflicted with psychopathic personality,' as it appears in § 212(a)(4) of the Act, is unconstitutionally vague. Since it fails to do so, I must dissent.
1
Although there is dictum on the point of Bonetti v. Rogers, 356 U.S. 691, 698—699, 78 S.Ct. 976, 2 L.Ed.2d 1087, we regard it as not fully considered, since resolution of the issue was not crucial to decision of the case. Compare Shaughnessy v. United States ex rel. Mezei, 345 U.S. 206, 213, 73 S.Ct. 625, 97 L.Ed. 956.
'The term 'entry' means any coming of an alien into the United States, from a foreign port or place or from an outlying possession, whether voluntarily or otherwise, except that an alien having a lawful permanent residence in the United States shall not be regarded as making an entry into the United States for the purposes of the immigration laws if the alien proves to the satisfaction of the Attorney General that his departure to a foreign port or place or to an outlying possession was not intended or reasonably to be expected by him or his presence in a foreign port or place or in an outlying possession was not voluntary: Provided, That no person whose departure from the United States was occasioned by deportation proceedings, extradition, or other legal process shall be held to be entitled to such exception.'
2
The 1952 Act became effective on December 24, 1952, and Fleuti entered the country for permanent residence on October 9, 1952, a fact which is of significance because § 241(a)(1) of the Act only commands the deportation of aliens 'excludable by the law existing at the time of such entry * * *.' Hence, since respondent's homosexuality did not make him excludable by any law existing at the time of his 1952 entry, it is critical to determine whether his return from a few hours in Mexico in 1956 was an 'entry' in the statutory sense. If it was not, the question whether § 212(a)(4) could constitutionally be applied to him need not be resolved.
3
Previous cases which contain the same general kind of language, but which are distinguishable on their facts, are Lapina v. Williams, 232 U.S. 78, 34 S.Ct. 196, 58 L.Ed. 515; Lewis v. Frick, 233 U.S. 291, 34 S.Ct. 488, 58 L.Ed. 967; United States ex rel. Claussen v. Day, 279 U.S. 398, 49 S.Ct. 354, 73 L.Ed. 758; United States ex rel. Polymeris v. Trudell, 284 U.S. 279, 52 S.Ct. 13, 76 L.Ed. 516; and United States ex rel. Stapf v. Corsi, 287 U.S. 129, 53 S.Ct. 40, 77 L.Ed. 215. The only one of these cases which involved an absence from the country as extremely brief as Fleuti's is Lewis v. Frick, and in that case deportation was premised on the fact that on his return from the trip in issue the alien had sought to bring a woman into the country for an immoral purpose. 233 U.S., at 297—300, 34 S.Ct. at 490—492.
4
E.g., Ex parte Parianos, 23 F.2d 918 (C.A.9th Cir. 1928); United States ex rel. Medich v. Burmaster, 24 F.2d 57 (C.A.8th Cir. 1928); Cahan v. Carr, 47 F.2d 604 (C.A.9th Cir. 1931), cert. denied, 283 U.S. 862, 51 S.Ct. 655, 75 L.Ed. 1467; Zurbrick v. Borg, 47 F.2d 690 (C.A.6th Cir. 1931); Taguchi v. Carr, 62 F.2d 307 (C.A.9th Cir. 1932); Ward v. De Barros, 75 F.2d 34 (C.A.1st Cir. 1935); Guarneri v. Kessler, 98 F.2d 580 (C.A.5th Cir. 1938), cert. denied, 305 U.S. 648, 59 S.Ct. 229, 83 L.Ed. 419; Del Castillo v. Carr, 100 F.2d 338 (C.A.9th Cir. 1938); United States ex rel. Kowalenski v. Flynn, 17 F.2d 524 (D.C.W.D.N.Y.1927); United States ex rel. Siegel v. Reimer, 23 F.Supp. 642 (D.C.S.D.N.Y.), aff'd, 97 F.2d 1020 (C.A.2d Cir. 1938).
5
E.g., Jackson v. Zurbrick, 59 F.2d 937 (C.A.6th Cir. 1932); Zurbrick v. Woodhead, 90 F.2d 991 (C.A.6th Cir. 1937); United States ex rel. Ueberall v. Williams, 187 F. 470 (D.C.S.D.N.Y.1911); Guimond v. Howes, 9 F.2d 412 (D.C.D.Maine 1925); Ex parte Piazzola, 18 F.2d 114 (D.C.W.D.N.Y.1926).
6
In re Michael Bonadino, D.C.W.D.N.Y., unreported, Dec. 20, 1924; United States ex rel. Valenti v. Karmuth, 1 F.Supp. 370 (D.C.N.D.N.Y.1932); Annello ex rel. Annello v. Ward, 8 F.Supp. 797 (D.C.D.Mass.1934).
7
It should be pointed out, however, that the Ninth Circuit has, subsequent to the decisions cited in the text, held specifically that length of time outside the country is still irrelevant to the question of 'entry.' Schoeps v. Carmichael, 177 F.2d 391 (C.A.9th Cir. 1949), cert. denied, 339 U.S. 914, 70 S.Ct. 566, 94 L.Ed. 1340; Pimental-Navarro v. Del Guercio, 256 F.2d 877 (C.A.9th Cir. 1958).
8
The House and Senate Committee Reports preceding enactment of the bill both contained the following relevant paragraph:
'Section 101(a)(13) defines the term 'entry.' Frequent reference is made to the term 'entry' in the immigration laws, and many consequences relating to the entry and departure of aliens flow from its use, but the term is not precisely defined in the present law. Normally an entry occurs when the alien crosses the border of the United States and makes a physical entry, and the question of whether an entry has been made is susceptible of a precise determination. However, for the purposes of determining the effect of a subsequent entry upon the status of an alien who has previously entered the United States and resided therein, the preciseness of the term 'entry' has not been found to be as apparent. Earlier judicial constructions of the term in the immigration laws, as set forth in United States ex rel. Volpe v. Smith (289 U.S. 422, (53 S.Ct. 665, 77 L.Ed. 1298) (1933)), generally held that the term 'entry' included any coming of an alien from a foreign country to the United States whether such coming be the first or a subsequent one. More recently, the courts have departed from the rigidity of that rule and have recognized that an alien does not make an entry upon his return to the United States from a foreign country where he had no intent to leave the United States (Di Pasquale v. Karnuth, 158 F.2d 878 (C.C.A.2d 1947)), or did not leave the country voluntarily (Delgadillo v. Carmichael, 332 U.S. 388, (68 S.Ct. 10) (1947)). The bill defines the term 'entry' as precisely as practicable, giving due recognition to the judicial precedents. Thus any coming of an alien from a foreign port or place or an outlying possession into the United States is to be considered an entry, whether voluntary or otherwise, unless the Attorney General is satisfied that the departure of the alien, other than a deportee, from this country was unintentional or was not voluntary.' H.R.Rep. No. 1365, 82d Cong., 2d Sess. 32 (1952); S.Rep. No. 1137, 82d Cong., 2d Sess. 4 (1952); U.S.Code Congressional and Administrative News 1952, p. 1683.
9
See Ng Fung Ho v. White, 259 U.S. 276, 284, 42 S.Ct. 492, 66 L.Ed. 938; Bridges v. Wixon, 326 U.S. 135, 147, 65 S.Ct. 1443, 89 L.Ed. 2103; Fong Haw Tan v. Phelan, 333 U.S. 6, 10, 68 S.Ct. 374, 92 L.Ed. 433; Barber v. Gonzales, 347 U.S. 637, 642—643, 74 S.Ct. 822, 98 L.Ed. 1009.
10
Compare Bernard, American Immigration Policy (1950), 296; Gordon, When Does an Alien Enter the United States? 9 Fed.B.J. 248, 250, 258—259 (1948); Hofstein, The Returning Resident Alien, 10 Intra.L.Rev. 271, 273, 280 (1955); Konvitz, Civil Rights in Immigration (1953), 92; Maslow, Recasting Our Deportation Law: Proposals for Reform, 56 Col.L.Rev. 309, 327—329 (1956); Report of the President's Commission on Immigration and Naturalization, Whom We Shall Welcome (1953), 179—180, 199—200; Note, Rights of Aliens in Exclusion Proceedings, 3 Utah L.Rev. 349, 350 n. 20 (1953); Note, Limitations on Congressional Power to Deport Resident Aliens Excludable as Psychopaths at Time of Entry, 68 Yale L.J. 931, 937 938 n. 25 (1959).
1
Statement of Edward J. Ennis, Representing the American Civil Liberties Union, printed in Joint Hearings before the Subcommittees of the Committees on the Judiciary on S. 716 H.R. 2379, and H.R. 2816, 82d Cong., 1st Sess. 143.
2
Recommendations and Suggestion With Respect to Titles I and II of S. 716 and H.R. 2379, printed in Joint Hearings, supra, note 1, at 617. See also Testimony of Stanley H. Lowell on Behalf of Americans for Democratic Action, id., at 445.
3
See, e.g., Morissette v. United States, 342 U.S. 246, 72 S.Ct. 240, 96 L.Ed. 288 (1952); Hall, General Principles of Criminal Law (2d ed. 1960), 105—145; Prosser, Torts (2d ed. 1955), 29—30.
| 12
|
374 U.S. 398
83 S.Ct. 1790
10 L.Ed.2d 965
Adell H. SHERBERT, Appellant,v.Charlie V. VERNER et al., as members of South Carolina Employment Security Commission, and Spartan Mills.
No. 526.
Argued April 24, 1963.
Decided June 17, 1963.
William D. Donnelly, Bethesda, Md., for appellant.
Daniel R. McLeod, Columbia, S.C., for appellees.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
Appellant, a member of the Seventh-day Adventist Church was discharged by her South Carolina employer because she would not work on Saturday, the Sabbath Day of her faith.1 When she was unable to obtain other employment because from conscientious scruples she would not take Saturday work,2 she filed a claim for unemployment compensation benefits under the South Carolina Unemployment Compensation Act.3 That law provides that, to be eligible for benefits, a claimant must be 'able to work and * * * is available for work'; and, further, that a claimant is ineligible for benefits '(i)f * * * he has failed, without good cause * * * to accept available suitable work when offered him by the employment office or the employer * * *.' The appellee Employment Security Commission, in administrative proceedings under the statute, found that appellant's restriction upon her availability for Saturday work brought her within the provision disqualifying for benefits insured workers who fail, without good cause, to accept 'suitable work when offered * * * by the employment office or the employer * * *.' The Commission's finding was sustained by the Court of Common Pleas for Spartanburg County. That court's judgment was in turn affirmed by the South Carolina Supreme Court, which rejected appellant's contention that, as applied to her, the disqualifying provisions of the South Carolina statute abridged her right to the free exercise of her religion secured under the Free Exercise Clause of the First Amendment through the Fourteenth Amendment. The State Supreme Court held specifically that appellant's ineligibility infringed no constitutional liberties because such a construction of the statute 'places no restriction upon the appellant's freedom of religion nor does it in any way prevent her in the exercise of her right and freedom to observe her religious beliefs in accordance with the dictates of her conscience.' 240 U.S. 286, 303—304, 125 S.E.2d 737, 746.4 We noted probable jurisdiction of appellant's appeal.371 U.S. 938, 83 S.Ct. 321, 9 L.Ed.2d 273. We reverse the judgment of the South Carolina Supreme Court and remand for further proceedings not inconsistent with this opinion.
I.
2
The door of the Free Exercise Clause stands tightly closed against any governmental regulation of religious beliefs as such, Cantwell v. Connecticut, 310 U.S. 296, 303, 60 S.Ct. 900, 903, 84 L.Ed. 1213. Government may neither compel affirmation of a repugnant belief, Torcaso v. Watkins, 367 U.S. 488, 81 S.Ct. 1680, 6 L.Ed.2d 982; nor penalize or discriminate against individuals or groups because they hold religious views abhorrent to the authorities, Fowler v. Rhode Island, 345 U.S. 67, 73 S.Ct. 526, 97 L.Ed. 828; nor employ the taxing power to inhibit the dissemination of particular religious views, Murdock v. Pennsylvania, 319 U.S. 105, 63 S.Ct. 870, 87 L.Ed. 1292; Follett v. McCormick, 321 U.S. 573, 64 S.Ct. 717, 88 L.Ed. 938; cf. Grosjean v. American Press Co., 297 U.S. 233, 56 S.Ct. 444, 80 L.Ed. 660. On the other hand, the Court has rejected challenges under the Free Exercise Clause to governmental regulation of certain overt acts prompted by religious beliefs or principles, for 'even when the action is in accord with one's religious convictions, (it) is not totally free from legislative restrictions.' Braunfeld v. Brown, 366 U.S. 599, 603, 81 S.Ct. 1144, 1146, 6 L.Ed.2d 563. The conduct or actions so regulated have invariably posed some substantial threat to public safety, peace or order. See, e.g., Reynolds v. United States, 98 U.S. 145, 25 L.Ed. 244; Jacobson v. Massachusetts, 197 U.S. 11, 25 S.Ct. 358, 49 L.Ed. 643; Prince v. Massachusetts, 321 U.S. 158, 64 S.Ct. 438, 88 L.Ed. 645; Cleveland v. United States, 329 U.S. 14, 67 S.Ct. 13, 91 L.Ed. 12.
3
Plainly enough, appellant's conscientious objection to Saturday work constitutes no conduct prompted by religious principles of a kind within the reach of state legislation. If, therefore. the decision of the South Carolina Supreme Court is to withstand appellant's constitutional challenge, it must be either because her disqualification as a beneficiary represents no infringement by the State of her constitutional rights of free exercise, or because any incidental burden on the free exercise of appellant's religion may be justified by a 'compelling state interest in the regulation of a subject within the State's constitutional power to regulate * * *.' NAACP v. Button, 371 U.S. 415, 438, 83 S.Ct. 328, 341, 9 L.Ed.2d 405.
II.
4
We turn first to the question whether the disqualification for benefits imposes any burden on the free exercise of appellant's religion. We think it is clear that it does. In a sense the consequences of such a disqualification to religious principles and practices may be only an indirect result of welfare legislation within the State's general competence to enact; it is true that no criminal sanctions directly compel appellant to work a six-day week. But this is only the beginning, not the end, of our inquiry.5 For '(i)f the purpose or effect of a law is to impede the observance of one or all religions or is to discriminate invidiously between religions, that law is constitutionally invalid even though the burden may be characterized as being only indirect.' Braunfeld v. Brown, supra, 366 U.S., at 607, 81 S.Ct., at 1148. Here not only is it apparent that appellant's declared ineligibility for benefits derives solely from the practice of her religion, but the pressure upon her to forego that practice is unmistakable. The ruling forces her to choose between following the precepts of her religion and forfeiting benefits, on the one hand, and abandoning one of the precepts of her religion in order to accept work, on the other hand. Governmental imposition of such a choice puts the same kind of burden upon the free exercise of religion as would a fine imposed against appellant for her Saturday worship.
5
Nor may the South Carolina court's construction of the statute be saved from constitutional infirmity on the ground that unemployment compensation benefits are not appellant's 'right' but merely a 'privilege.' It is too late in the day to doubt that the liberties of religion and expression may be infringed by the denial of or placing of conditions upon a benefit or privilege.6 American Communications Ass'n v. Douds, 339 U.S. 382, 390, 70 S.Ct. 674, 679, 94 L.Ed. 925; Wieman v. Updegraff, 344 U.S. 183, 191—192, 73 S.Ct. 215, 218—219, 97 L.Ed. 216; Hannegan v. Esquire, Inc., 327 U.S. 146, 155—156, 66 S.Ct. 456, 461, 90 L.Ed. 586. For example, in Flemming v. Nestor, 363 U.S. 603, 611, 80 S.Ct. 1367, 1373, 4 L.Ed.2d 1435, the Court recognized with respect to Federal Social Security benefits that '(t)he interest of a covered employee under the Act is of sufficient substance to fall within the protection from arbitrary governmental action afforded by the Due Process Clause.' In Speiser v. Randall, 357 U.S. 513, 78 S.Ct. 1332, 2 L.Ed.2d 1460, we emphasized that conditions upon public benefits cannot be sustained if they so operate, whatever their purpose, as to inhibit or deter the exercise of First Amendment freedoms. We there struck down a condition which limited the availability of a tax exemption to those members of the exempted class who affirmed their loyalty to the state government granting the exemption. While the State was surely under no obligation to afford such an exemption, we held that the imposition of such a condition upon even a gratuitous benefit inevitably deterred or discouraged the exercise of First Amendment rights of expression and thereby threatened to 'produce a result which the State could not command directly.' 357 U.S., at 526, 78 S.Ct., at 1342. 'To deny an exemption to claimants who engage in certain forms of speech is in effect to penalize them for such speech.' Id., 357 U.S., at 518, 78 S.Ct., at 1338. Likewise, to condition the availability of benefits upon this appellant's willingness to violate a cardinal principle of her religious faith effectively penalizes the free exercise of her constitutional liberties.
6
Significantly South Carolina expressly saves the Sunday worshipper from having to make the kind of choice which we here hold infringes the Sabbatarian's religious liberty. When in times of 'national emergency' the textile plants are authorized by the State Commissioner of Labor to operate on Sunday, 'no employee shall be required to work on Sunday * * * who is conscientiously opposed to Sunday work; and if any employee should refuse to work on Sunday on account of conscientious * * * objections he or she shall not jeopardize his or her seniority by such refusal or be discriminated against in any other manner.' S.C.Code, § 64—4. No question of the disqualification of a Sunday worshipper for benefits is likely to arise, since we cannot suppose that an employer will discharge him in violation of this statute. The unconstitutionality of the disqualification of the Sabbatarian is thus compounded by the religious discrimination which South Carolina's general statutory scheme necessarily effects.
III.
7
We must next consider whether some compelling state interest enforced in the eligibility provisions of the South Carolina statute justifies the substantial infringement of appellant's First Amendment right. It is basic that no showing merely of a rational relationship to some colorable state interest would suffice; in this highly sensitive constitutional area, '(o)nly the gravest abuses, endangering paramount interest, give occasion for permissible limitation,' Thomas v. Collins, 323 U.S. 516, 530, 65 S.Ct. 315, 323, 89 L.Ed. 430. No such abuse or danger has been advanced in the present case. The appellees suggest no more than a possibility that the filing of fraudulent claims by unscrupulous claimants feigning religious objections to Saturday work might not only dilute the unemployment compensation fund but also hinder the scheduling by employers of necessary Saturday work. But that possibility is not apposite here because no such objection appears to have been made before the South Carolina Supreme Court, and we are unwilling to assess the importance of an asserted state interest without the views of the state court. Nor, if the contention had been made below, would the record appear to sustain it; there is no proof whatever to warrant such fears of malingering or deceit as those which the respondents now advance. Even if consideration of such evidence is not foreclosed by the prohibition against judicial inquiry into the truth or falsity of religious beliefs, United States v. Ballard, 322 U.S. 78, 64 S.Ct. 882, 88 L.Ed. 1148—a question as to which we intimate no view since it is not before us—it is highly doubtful whether such evidence would be sufficient to warrant a substantial infringement of religious liberties. For even if the possibility of spurious claims did threaten to dilute the fund and disrupt the scheduling of work, it would plainly be incumbent upon the appellees to demonstrate that no alternative forms of regulation would combat such abuses without infringing First Amendment rights.7 Cf. Shelton v. Tucker, 364 U.S. 479, 487—490, 81 S.Ct. 247, 251—253, 5 L.Ed.2d 231; Talley v. California, 362 U.S. 60, 64, 80 S.Ct. 536, 538, 4 L.Ed.2d 559; Schneider v. State of New Jersey, 308 U.S. 147, 161, 60 S.Ct. 146, 150, 84 L.Ed. 155; Martin v. Struthers, 319 U.S. 141, 144—149, 63 S.Ct. 862, 863—866, 87 L.Ed. 1313.
8
In these respects, then, the state interest asserted in the present case is wholly dissimilar to the interests which were found to justify the less direct burden upon religious practices in Braunfeld v. Brown, supra. The Court recognized that the Sunday closing law which that decision sustained undoubtedly served 'to make the practice of (the Orthodox Jewish merchants') religious beliefs more expensive,' 366 U.S., at 605, 81 S.Ct., at 1147. But the statute was nevertheless saved by a countervailing factor which finds no equivalent in the instant case—a strong state interest in providing one uniform day of rest for all workers. That secular objective could be achieved, the Court found, only by declaring Sunday to be that day of rest. Requiring exemptions for Sabbatarians, while theoretically possible, appeared to present an administrative problem of such magnitude, or to afford the exempted class so great a competitive advantage, that such a requirement would have rendered the entire statutory scheme unworkable.8 In the present case no such justifications underlie the determination of the state court that appellant's religion makes her ineligible to receive benefits.9
IV.
9
In holding as we do, plainly we are not fostering the 'establishment' of the Seventh-day Adventist religion in South Carolina, for the extension of unemployment benefits to Sabbatarians in common with Sunday worshippers reflects nothing more than the governmental obligation of neutrality in the face of religious differences, and does not represent that involvement of religious with secular institutions which it is the object of the Establishment Clause to forestall. See School District of Abington Township v. Schempp, 374 U.S. 203, 83 S.Ct. 1560. Nor does the recognition of the appellant's right to unemployment benefits under the state statute serve to abridge any other person's religious liberties. Nor do we, by our decision today, declare the existence of a constitutional right to unemployment benefits on the part of all persons whose religious convictions are the cause of their unemployment. This is not a case in which an employee's religious convictions serve to make him a nonproductive member of society. See note 2, supra. Finally, nothing we say today constrains the States to adopt any particular form or scheme of unemployment compensation. Our holding today is only that South Carolina may not constitutionally apply the eligibility provisions so as to constrain a worker to abandon his religious convictions respecting the day of rest. This holding but reaffirms a principle that we announced a decade and a half ago, namely that no State may 'exclude individual Catholics, Lutherans, Mohammedans, Baptists, Jews, Methodists, Non-believers, Presbyterians, or the members of any other faith, because of their faith, or lack of it, from receiving the benefits of public welfare legislation.' Everson v. Board of Education, 330 U.S. 1, 16, 67 S.Ct. 504, 512, 91 L.Ed. 711.
10
In view of the result we have reached under the First and Fourteenth Amendments' guarantee of free exercise of religion, we have no occasion to consider appellant's claim that the denial of benefits also deprived her of the equal protection of the laws in violation of the Fourteenth Amendment.
11
The judgment of the South Carolina Supreme Court is reversed and the case is remanded for further proceedings not inconsistent with this opinion. It is so ordered.
12
Reversed and remanded.
13
Mr. Justice DOUGLAS, concurring.
14
The case we have for decision seems to me to be of small dimensions, though profoundly important. The question is whether the South Carolina law which denies unemployment compensation to a Seventh-day Adventist, who, because of her religion, has declined to work on her Sabbath, is a law 'prohibiting the free exercise' of religion as those words are used in the First Amendment. It seems obvious to me that this law does run afoul of that clause.
15
Religious scruples of Moslems require them to attend a mosque on Friday and to pray five times daily.1 Religious scruples of a Sikh require him to carry a regular or a symbolic sword. Rex v. Singh, 39 A.I.R. 53 (Allahabad, 1952). Religious scruples of a Jehovah's Witness teach him to be a colporteur, going from door to door, from town to town, distributing his religious pamphlets. See Murdock v. Pennsylvania, 319 U.S. 105, 63 S.Ct. 870, 87 L.Ed. 1292. Religious scruples of a Quaker compel him to refrain from swearing and to affirm instead. See King v. Fearson, Fed.Cas. No. 7,790, 14 Fed.Cas. 520; 1 U.S.C. § 1; Federal Rules of Civil Procedure, Rule 43(d); United States v. Schwimmer, 279 U.S. 644, 655, 49 S.Ct. 448, 451, 73 L.Ed. 889 (dissenting opinion). Religious scruples of a Buddhist may require him to refrain from partaking of any flesh, even of fish.2
16
The examples could be multiplied, including those of the Seventh-day Adventist whose Sabbath is Saturday and who is advised not to eat some meats.3
17
These suffice, however, to show that many people hold beliefs alien to the majority of our society—beliefs that are protected by the First Amendment but which could easily be trod upon under the guise of 'police' or 'health' regulations reflecting the majority's views.
18
Some have thought that a majority of a community can, through state action, compel a minority to observe their particular religious scruples so long as the majority's rule can be said to perform some valid secular function. That was the essence of the Court's decision in the Sunday Blue Law Cases (Gallagher v. Crown Kosher Market, 366 U.S. 617, 81 S.Ct. 1122, 6 L.Ed.2d 536; Braunfeld v. Brown, 366 U.S. 599, 81 S.Ct. 1144, 6 L.Ed.2d 563; McGowan v. Maryland, 366 U.S. 420, 81 S.Ct. 1101, 6 L.Ed.2d 393), a ruling from which I then dissented (McGowan v. Maryland, supra, 366 U.S. pp. 575—576, 81 S.Ct. pp. 1225—1226) and still dissent. See Arlan's Dept. Store v. Kentucky, 371 U.S. 218, 83 S.Ct. 277, 9 L.Ed.2d 264.
19
That ruling of the Court travels part of the distance that South Carolina asks us to go now. She asks us to hold that when it comes to a day of rest a Sabbatarian must conform with the scruples of the majority in order to obtain unemployment benefits.
20
The result turns not on the degree of injury, which may indeed be nonexistent by ordinary standards. The harm is the interference with the individual's scruples or conscience—an important area of privacy which the First Amendment fences off from government. The interference here is as plain as it is in Soviet Russia, where a churchgoer is given a second-class citizenship, resulting in harm though perhaps not in measurable damages.
21
This case is resolvable not in terms of what an individual can demand of government, but solely in terms of what government may not do to an individual in violation of his religious scruples. The fact that government cannot exact from me a surrender of one iota of my religious scruples does not, of course, mean that I can demand of government a sum of money, the better to exercise them. For the Free Exercise Clause is written in terms of what the government cannot do to the individual, not in terms of what the individual can exact from the government.
22
Those considerations, however, are not relevant here. If appellant is otherwise qualified for unemployment benefits, payments will be made to her not as a Seventh-day Adventist, but as an unemployed worker. Conceivably these payments will indirectly benefit her church, but no more so than does the salary of any public employee. Thus, this case does not involve the problems of direct or indirect state assistance to a religious organization—matters relevant to the Establishment Clause, not in issue here.
23
Mr. Justice STEWART, concurring in the result.
24
Although fully agreeing with the result which the Court reaches in this case, I cannot join the Court's opinion. This case presents a double-barreled dilemma, which in all candor I think the Court's opinion has not succeeded in papering over. The dilemma ought to be resolved.
I.
25
Twenty-three years ago in Cantwell v. Connecticut, 310 U.S. 296, 303, 60 S.Ct. 900, 903, 84 L.Ed. 1213, the Court said that both the Establishment Clause and the Free Exercise Clause of the First Amendment were made wholly applicable to the States by the Fourteenth Amendment. In the intervening years several cases involving claims of state abridgment of individual religious freedom have been decided here—most recently Braunfeld v. Brown, 366 U.S. 599, 81 S.Ct. 1144, 6 L.Ed.2d 563, and Torcaso v. Watkins, 367 U.S. 488, 81 S.Ct. 1680, 6 L.Ed.2d 982. During the same period 'cases dealing with the specific problems arising under the 'Establishment' Clause which have reached this Court are few in number.'1 The most recent are last Term's Engel v. Vitale, 370 U.S. 421, 82 S.Ct. 1261, 8 L.Ed.2d 601, and this Term's Schempp and Murray cases, 374 U.S. 203, 83 S.Ct. 1560.
26
I am convinced that no liberty is more essential to the continued vitality of the free society which our Constitution guarantees than is the religious liberty protected by the Free Exercise Clause explicit in the First Amendment and imbedded in the Fourteenth. And I regret that on occasion, and specifically in Braunfeld v. Brown, supra, the Court has shown what has seemed to me a distressing insensitivity to the appropriate demands of this constitutional guarantee. By contrast I think that the Court's approach to the Establishment Clause has on occasion, and specifically in Engel, Schempp and Murray, been not only insensitive, but positively wooden, and that the Court has accorded to the Establishment Clause a meaning which neither the words, the history, nor the intention of the authors of that specific constitutional provision even remotely suggests.
27
But my views as to the correctness of the Court's decisions in these cases are beside the point here. The point is that the decisions are on the books. And the result is that there are many situations where legitimate claims under the Free Exercise Clause will run into head-on collision with the Court's insensitive and sterile construction of the Establishment Clause.2 The controversy now before us is clearly such a case.
28
Because the appellant refuses to accept available jobs which would require her to work on Saturdays, South Carolina has declined to pay unemployment compensation benefits to her. Her refusal to work on Saturdays is based on the tenets of her religious faith. The Court says that South Carolina cannot under these circumstances declare her to be not 'available for work' within the meaning of its statute because to do so would violate her constitutional right to the free exercise of her religion.
29
Yet what this Court has said about the Establishment Clause must inevitably lead to a diametrically opposite result. If the appellant's refusal to work on Saturdays were based on indolence, or on a compulsive desire to watch the Saturday television programs, no one would say that South Carolina could not hold that she was not 'available for work' within the meaning of its statute. That being so, the Establishment Clause as construed by this Court not only permits but affirmatively requires South Carolina equally to deny the appellant's claim for unemployment compensation when her refusal to work on Saturdays is based upon her religious creed. For, as said in Everson v. Board of Education, 330 U.S. 1, 11, 67 S.Ct. 504, 509, 91 L.Ed. 711, the Establishment Clause bespeaks 'a government * * * stripped of all power * * * to support, or otherwise to assist any or all religions * * *,' and no State 'can pass laws which aid one religion * * *.' Id., 330 U.S., at 15, 67 S.Ct., at 511. In Mr. Justice Rutledge's words, adopted by the Court today in Schempp, 374 U.S., p. 217, 83 S.Ct., p. 1568, the Establishment Clause forbids 'every form of public aid or support for religion.' 330 U.S., at 32, 67 S.Ct., at 519. In the words of the Court in Engel v. Vitale, 370 U.S., at 431, 82 S.Ct., at 1267, reaffirmed today in the Schempp case, 374 U.S., p. 221, 83 S.Ct., p. 1571, the Establishment Clause forbids the 'financial support of government' to be 'placed behind a particular religious belief.'
30
To require South Carolina to so administer its laws as to pay public money to the appellant under the circumstances of this case is thus clearly to require the State to violate the Establishment Clause as construed by this Court. This poses no problem for me, because I think the Court's mechanistic concept of the Establishment Clause is historically unsound and constitutionally wrong. I think the process of constitutional decision in the area of the relationships between government and religion demands considerably more than the invocation of broad-brushed rhetoric of the kind I have quoted. And I think that the guarantee of religious liberty embodied in the Free Exercise Clause affirmatively requires government to create an atmosphere of hospitality and accommodation to individual belief or disbelief. In short, I think our Constitution commands the positive protection by government of religious freedom—not only for a minority, however small—not only for the majority, however large—but for each of us.
31
South Carolina would deny unemployment benefits to a mother unavailable for work on Saturdays because she was unable to get a babysitter.3 Thus, we do not have before us a situation where a State provides unemployment compensation generally, and singles out for disqualification only those persons who are unavailable for work on religious grounds. This is not, in short, a scheme which operates so as to discriminate against religion as such. But the Court nevertheless holds that the State must prefer a religious over a secular ground for being unavailable for work that state financial support of the appellant's religion is constitutionally required to carry out 'the governmental obligation of neutrality in the face of religious differences * * *.'
32
Yet in cases decided under the Establishment Clause the Court has decreed otherwise. It has decreed that government must blind itself to the differing religious beliefs and traditions of the people. With all respect, I think it is the Court's duty to face up to the dilemma posed by the conflict between the Free Exercise Clause of the Constitution and the Establishment Clause as interpreted by the Court. It is a duty, I submit, which we owe to the people, the States, and the Nation, and a duty which we owe to ourselves. For so long as the resounding but fallacious fundamentalist rhetoric of some of our Establishment Clause opinions remains on our books, to be disregarded at will as in the present case, or to be undiscriminatingly invoked as in the Schempp case, 374 U.S. 203, 83 S.Ct. 1560, so long will the possibility of consistent and perceptive decision in this most difficult and delicate area of constitutional law be impeded and impaired. And so long, I fear, will the guarantee of true religious freedom in our pluralistic society be uncertain and insecure.
II.
33
My second difference with the Court's opinion is that I cannot agree that to day's decision can stand consistently with Braunfeld v. Brown, supra. The Court says that there was a 'less direct burden upon religious practices' in that case than in this. With all respect, I think the Court is mistaken, simply as a matter of fact. The Braunfeld case involved a state criminal statute. The undisputed effect of that statute, as pointed out by Mr. Justice BRENNAN in his dissenting opinion in that case, was that "Plaintiff, Abraham Braunfeld, will be unable to continue in his business if he may not stay open on Sunday and he will thereby lose his capital investment.' In other words, the issue in this case—and we do not understand either appellees or the Court to contend otherwise—is whether a State may put an individual to a choice between his business and his religion.' 366 U.S., at 611, 81 S.Ct., at 1150.
34
The impact upon the appellant's religious freedom in the present case is considerably less onerous. We deal here not with a criminal statute, but with the particularized administration of South Carolina's Unemployment Compensation Act. Even upon the unlikely assumption that the appellant could not find suitable non-Saturday employment,4 the appellant at the worst would be denied a maximum of 22 weeks of compensation payments. I agree with the Court that the possibility of that denial is enough to infringe upon the appellant's constitutional right to the free exercise of her religion. But it is clear to me that in order to reach this conclusion the court must explicitly reject the reasoning of Braunfeld v. Brown. I think the Braunfeld case was wrongly decided and should be overruled, and accordingly I concur in the result reached by the Court in the case before us.
35
Mr. Justice HARLAN, whom Mr. Justice WHITE joins, dissenting.
36
Today's decision is disturbing both in its rejection of existing precedent and in its implications for the future. The significance of the decision can best be understood after an examination of the state law applied in this case.
37
South Carolina's Unemployment Compensation Law was enacted in 1936 in response to the grave social and economic problems that arose during the depression of that period. As stated in the statute itself:
38
'Economic insecurity due to unemployment is a serious menace to health, morals and welfare of the people of this State; involuntary unemployment is therefore a subject of general interest and concern * * *; the achievement of social security requires protection against this greatest hazard of our economic life; this can be provided by encouraging the employers to provide more stable employment and by the systematic accumulation of funds during periods of employment to provide benefits for periods of unemployment, thus maintaining purchasing power and limiting the serious social consequences of poor relief assistance.' § 68—38. (Emphasis added.) Thus the purpose of the legislature was to tide people over, and to avoid social and economic chaos, during periods when work was unavailable. But at the same time there was clearly no intent to provide relief for those who for purely personal reasons were or became unavailable for work. In accordance with this design, the legislature provided, in § 68—113, that '(a)n unemployed insured worker shall be eligible to receive benefits with respect to any week only if the Commission finds that * * * (h)e is able to work and is available for work * * *.' (Emphasis added.)
39
The South Carolina Supreme Court has uniformly applied this law in conformity with its clearly expressed purpose. It has consistently held that one is not 'available for work' if his unemployment has resulted not from the inability of industry to provide a job but rather from personal circumstances, no matter how compelling. The reference to 'involuntary unemployment' in the legislative statement of policy, whatever a sociologist, philosopher, or theologian might say, has been interpreted not to embrace such personal circumstances. See, e.g., Judson Mills v. South Carolina Unemployment Compensation Comm., 204 S.C. 37, 28 S.E.2d 535 (claimant was 'unavailable for work' when she became unable to work the third shift, and limited her availability to the other two, because of the need to care for her four children); Stone Mfg. Co. v. South Carolina Employment Security Comm., 219 S.C. 239, 64 S.E.2d 644; Hartsville Cotton Mill v. South Carolina Employment Security Comm., 224 S.C. 407, 79 S.E.2d 381.
40
In the present case all that the state court has done is to apply these accepted principles. Since virtually all of the mills in the Spartanburg area were operating on a six-day week, the appellant was 'unavailable for work,' and thus ineligible for benefits, when personal considerations prevented her from accepting employment on a full-time basis in the industry and locality in which she had worked. The fact that these personal considerations sprang from her religious convictions was wholly without relevance to the state court's application of the law. Thus in no proper sense can it be said that the State discriminated against the appellant on the basis of her religious beliefs or that she was denied benefits because she was a Seventh-day Adventist. She was denied benefits just as any other claimant would be denied benefits who was not 'available for work' for personal reasons.1
41
With this background, this Court's decision comes into clearer focus. What the Court is holding is that if the State chooses to condition unemployment compensation on the applicant's availability for work, it is constitutionally compelled to carve out an exception—and to provide benefits—for those whose unavailability is due to their religious convictions.2 Such a holding has particular significance in two respects.
42
First, despite the Court's protestations to the contrary, the decision necessarily overrules Braunfeld v. Brown, 366 U.S. 599, 81 S.Ct. 1144, 6 L.Ed.2d 563, which held that it did not offend the 'Free Exercise' Clause of the Constitution for a State to forbid a Sabbatarian to do business on Sunday. The secular purpose of the statute before us today is even clearer than that involved in Braunfeld. And just as in Braunfeld—where exceptions to the Sunday closing laws for Sabbatarians would have been inconsistent with the purpose to achieve a uniform day of rest and would have required case-by-case inquiry into religious beliefs—so here, an exception to the rules of eligibility based on religious convictions would necessitate judicial examination of those convictions and would be at odds with the limited purpose of the statute to smooth out the economy during periods of industrial instability. Finally, the indirect financial burden of the present law is far less than that involved in Braunfeld. Forcing a store owner to close his business on Sunday may well have the effect of depriving him of a satisfactory livelihood if his religious convictions require him to close on Saturday as well. Here we are dealing only with temporary benefits, amounting to a fraction of regular weekly wages and running for not more than 22 weeks. See §§ 68—104, 68—105. Clearly, any differences between this case and Braunfeld cut against the present appellant.3
43
Second, the implications of the present decision are far more troublesome than its apparently narrow dimensions would indicate at first glance. The meaning of today's holding, as already noted, is that the State must furnish unemployment benefits to one who is unavailable for work if the unavailability stems from the exercise of religious convictions. The State, in other words, must single out for financial assistance those whose behavior is religiously motivated, even though it denies such assistance to others whose identical behavior (in this case, inability to work no Saturdays) is not religiously motivated.
44
It has been suggested that such singling out of religious conduct for special treatment may violate the constitutional limitations on state action. See Kurland. Of Church and State and The Supreme Court, 29 U. of Chi.L.Rev. 1; cf. Cammarano v. United States, 358 U.S. 498, 515, 79 S.Ct. 524, 534, 3 L.Ed.2d 462 (concurring opinion). My own view, however, is that at least under the circumstances of this case it would be a permissible accommodation of religion for the State, if it chose to do so, to create an exception to its eligibility requirements for persons like the appellant. The constitutional obligation of 'neutrality,' see School District of Abington Township v. Schempp, 372 U.S., p. 222, 83 S.Ct., p. 1571, is not so narrow a channel that the slightest deviation from an absolutely straight course leads to condemnation. There are too many instances in which no such course can be charted, too many areas in which the pervasive activities of the State justify some special provision for religion to prevent it from being submerged by an all-embracing secularism. The State violates its obligation of neutrality when, for example, it mandates a daily religious exercise in its public schools, with all the attendant pressures on the school children that such an exercise entails. See Engel v. Vitale, 370 U.S. 421, 82 S.Ct. 1261, 8 L.Ed.2d 601; School District of Abington Township v. Schempp, supra. But there is, I believe, enough flexibility in the Constitution to permit a legislative judgment accommodating an unemployment compensation law to the exercise of religious beliefs such as appellant's.
45
For very much the same reasons, however, I cannot subscribe to the conclusion that the State is constitutionally compelled to carve out an exception to its general rule of eligibility in the present case. Those situations in which the Constitution may require special treatment on account of religion are, in my view, few and far between, and this view is amply supported by the course of constitutional litigation in this area. See, e.g., Braunfeld v. Brown, supra; Cleveland v. United States, 329 U.S. 14, 67 S.Ct. 13, 91 L.Ed. 12; Prince v. Massachusetts, 321 U.S. 158, 64 S.Ct. 438, 88 L.Ed. 645; Jacobson v. Massachusetts, 197 U.S. 11, 25 S.Ct. 358, 49 L.Ed. 643; Reynolds v. United States, 98 U.S. 145, 25 L.Ed. 244. Such compulsion in the present case is particularly inappropriate in light of the indirect, remote, and insubstantial effect of the decision below on the exercise of appellant's religion and in light of the direct financial assistance to religion that today's decision requires.
46
For these reasons I respectfully dissent from the opinion and judgment of the Court.4
1
Appellant became a member of the Seventh-day Adventist Church in 1957, at a time when her employer, a textile-mill operator, permitted her to work a five-day week. It was not until 1959 that the work week was changed to six days, including Saturday, for all three shifts in the employer's mill. No question has been raised in this case concerning the sincerity of appellant's religious beliefs. Nor is there any doubt that the prohibition against Saturday labor is a basic tenet of the Seventh-day Adventist creed, based upon that religion's interpretation of the Holy Bible.
2
After her discharge, appellant sought employment with three other mills in the Spartanburg area, but found no suitable five-day work available at any of the mills. In filing her claim with the Commission, she expressed a willingness to accept employment at other mills, or even in another industry, so long as Saturday work was not required. The record indicates that of the 150 or more Seventh-day Adventists in the Spartanburg area, only appellant and one other have been unable to find suitable non-Saturday employment.
3
The pertinent sections of the South Carolina Unemployment Compensation Act (S.C.Code, Tit. 68, §§ 68—1 to 68—404) are as follows:
§ 68—113. Conditions of eligibility for benefits.—An unemployed insured worker shall be eligible to receive benefits with respect to any week only if the Commission finds that: * * *
'(3) He is able to work and is available for work, but no claimant shall be considered available for work if engaged in self-employment of such nature as to return or promise remuneration in excess of the weekly benefit amounts he would have received if otherwise unemployed over such period of time. * * *
§ 68—114. Disqualification for benefits.—Any insured worker shall be ineligible for benefits: * * *
'(2) Discharge for misconduct.—If the Commission finds that he has been discharged for misconduct connected with his most recent work prior to filing a request for determination of insured status or a request for initiation of a claim series within an established benefit year, with such ineligibility beginning with the effective date of such request, and continuing not less than five nor more than the next twenty-two consecutive weeks (in addition to the waiting period), as determined by the Commission in each case according to the seriousness of the misconduct * * *
'(3) Failure to accept work.—(a) If the Commission finds that he has failed, without good cause, (i) either to apply for available suitable work, when so directed by the employment office or the Commission, (ii) to accept available suitable work when offered him by the employment office or the employer or (iii) to return to his customary self-employment (if any) when so directed by the Commission, such ineligibility shall continue for a period of five weeks (the week in which such failure occurred and the next four weeks in addition to the waiting period) as determined by the Commission according to the circumstances in each case * * *.
'(b) In determining whether or not any work is suitable for an individual, the Commission shall consider the degree of risk involved to his health, safety and morals, his physical fitness and prior training, his experience and prior earnings, his length of unemployment and prospects for securing local work in his customary occupation and the distance of the available work from his residence.'
4
It has been suggested that appellant is not within the class entitled to benefits under the South Carolina statute because her unemployment did not result from discharge or layoff due to lack of work. It is true that unavailability for work for some personal reasons not having to do with matters of conscience or religion has been held to be a basis of disqualification for benefits. See, e.g., Judson Mills v. South Carolina Unemployment Compensation Comm., 204 S.C. 37, 28 S.E.2d 535; Stone Mfg. Co. v. South Carolina Employment Security Comm., 219 S.C. 239, 64 S.E.2d 644. But appellant claims that the Free Exercise Clause prevents the State from basing the denial of benefits upon the 'personal reason' she gives for not working on Saturday. Where the consequence of disqualification so directly affects First Amendment rights, surely we should not conclude that every 'personal reason' is a basis for disqualification in the absence of explicit language to that effect in the statute or decisions of the South Carolina Supreme Court. Nothing we have found in the statute or in the cited decisions, cf. Lee v. Spartan Mills, 7 CCH Unemployment Ins.Rep.S.C. 8156 (C.P. 1944), and certainly nothing in the South Carolina Court's opinion in this case so construes the statute. Indeed, the contrary seems to have been that court's basic assumption, for if the eligibility provisions were thus limited, it would have been unnecessary for the court to have decided appellant's constitutional challenge to the application of the statute under the Free Exercise Clause.
Likewise, the decision of the State Supreme Court does not rest upon a finding that appellant was disqualified for benefits because she had been 'discharged for misconduct'—by reason of her Saturday absences—within the meaning of § 68—114(2). That ground was not adopted by the South Carolina Supreme Court, and the appellees do not urge in this Court that the disqualification rests upon that ground.
5
In a closely analogous context, this Court said:
'* * * the fact that no direct restraint or punishment is imposed upon speech or assembly does not determine the free speech question. Under some circumstances, indirect 'discouragements' undoubtedly have the same coercive effect upon the exercise of First Amendment rights as imprisonment, fines, injunctions or taxes. A requirement that adherents of particular religious faiths or political parties wear identifying armbands, for example, is obviously of this nature.' American Communications Ass'n v. Douds, 339 U.S. 382, 402, 70 S.Ct. 674, 686, 94 L.Ed. 925. Cf. Smith v. California, 361 U.S. 147, 153—155, 80 S.Ct. 215, 218—219, 4 L.Ed.2d 205.
6
See for examples of conditions and qualifications upon governmental privileges and benefits which have been invalidated because of their tendency to inhibit constitutionally protected activity, Steinberg v. United States, 163 F.Supp. 590, 143 Ct.Cl. 1; Syrek v. California Unemployment Ins. Board, 54 Cal.2d 519, 7 Cal.Rptr. 97, 354 P.2d 625; Fino v. Maryland Employment Security Board, 218 Md. 504, 147 A.2d 738; Chicago Housing Authority v. Blackman, 4 Ill.2d 319, 122 N.E.2d 522; Housing Authority of Los Angeles v. Cordova, 130 Cal.App.2d Supp. 883, 279 P.2d 215; Lawson v. Housing Authority of Milwaukee, 270 Wis. 269, 70 N.W.2d 605; Danskin v. San Diego Unified School District, 28 Cal.2d 536, 171 P.2d 885; American Civil Liberties Union v. Board of Education, 55 Cal.2d 167, 10 Cal.Rptr. 647, 359 P.2d 45; cf. City of Baltimore v. A. S. Abell Co., 218 Md. 273, 145 A.2d 111. See also Willcox, Invasions of the First Amendment Through Conditioned Public Spending, 41 Cornell L.Q. 12 (1955); Emerson, Toward a General Theory of the First Amendment, 72 Yale L.J. 877, 942—943 (1963); 36 N.Y.U.L.Rev. 1052 (1961); 9 Kan.L.Rev. 346 (1961); Note, Unconstitutional Conditions, 73 Harv.L.Rev. 1595, 1599—1602 (1960).
7
We note that before the instant decision, state supreme courts had, without exception, granted benefits to persons who were physically available for work but unable to find suitable employment solely because of a religious prohibition against Saturday work. E.g., In re Miller, 243 N.C. 509, 91 S.E.2d 241; Swenson v. Michigan Employment Security Comm., 340 Mich. 430, 65 N.W.2d 709; Tary v. Board of Review, 161 Ohio St. 251, 119 N.E.2d 56. Cf. Kut v. Albers Super Markets, Inc., 146 Ohio St. 522, 66 N.E.2d 643, appeal dismissed sub nom. Kut v. Bureau of Unemployment Compensation, 329 U.S. 669, 67 S.Ct. 86, 91 L.Ed. 590. One author has observed, 'the law was settled that conscientious objections to work on the Sabbath made such work unsuitable and that such objectors were nevertheless available for work. * * * A contrary opinion would make the unemployment compensation law unconstitutional, as a violation of freedom of religion. Religious convictions, strongly held, are so impelling as to constitute good cause for refusal. Since availability refers to suitable work, religious observers were not unavailable because they excluded Sabbath work.' Altman, Availability for Work: A Study in Unemployment Compensation (1950), 187. See also Sanders, Disqualification for Unemployment Insurance, 8 Vand.L.Rev. 307, 327—328 (1955); 34 N.C.L.Rev. 591 (1956); cf. Freeman, Able To Work and Available for Work, 55 Yale L.J. 123, 131 (1945). Of the 47 States which have eligibility provisions similar to those of the South Carolina statute, only 28 appear to have given administrative rulings concerning the eligibility of persons whose religious convictions prevented them from accepting available work. Twenty-two of those States have held such persons entitled to benefits, although apparently only one such decision rests exclusively upon the federal constitutional ground which constitutes the basis of our decision. See 111 U. of Pa.L.Rev. 253, and n. 3 (1962); 34 N.C.L.Rev. 591, 602, n. 60 (1956).
8
See Note, State Sunday Laws and the Religious Guarantees of the Federal Constitution, 73 Harv.L.Rev. 729, 741—745 (1960).
9
These considerations also distinguish the quite different case of Flemming v. Nestor, supra, upon which appellees rely. In that case the Court found that the compelling federal interests which underlay the decision of Congress to impose such a disqualification justified whatever effect the denial of social security benefits may have had upon the disqualified class. See 363 U.S., at 612, 80 S.Ct., at 1373. And compare Torcaso v. Watkins, supra, in which an undoubted state interest in ensuring the veracity and trustworthiness of Notaries Public was held insufficient to justify the substantial infringement upon the religious freedom of applicants for that position which resulted from a required oath of belief of God. See 74 Harv.L.Rev. 611, 612 613 (1961); 109 U. of Pa.L.Rev. 611, 614—616 (1961).
1
See Shorter Encyclopaedia of Islam (Cornell Press, 1953), 336, 493.
2
See Narasu, The Essence of Buddhism (3d ed. 1948), 52—55; 6 Encyclopaedia of Religion and Ethics (1913), 63—65.
3
See Seventh-day Adventists Answer Questions on Doctrine (1957), 149—153, 622—624; Mitchell, Seventh-Day Adventists (1st ed. 1958), 127, 176—178.
1
McGowan v. Maryland, 366 U.S. 420, 442, 81 S.Ct. 1101, 1114, 6 L.Ed.2d 393.
2
The obvious potentiality of such collision has been studiously ignored by the Court, but has not escaped the perception of commentators. See, e.g., Katz, Freedom of Religion and State Neutrality, 20 U. of Chi.L.Rev. 426, 428 (1953); Kauper, Prayer, Public Schools and the Supreme Court, 61 Mich.L.Rev. 1031, 1053 (1963).
3
See Judson Mills v. South Carolina Unemployment Compensation Comm., 204 S.C. 37, 28 S.E.2d 535; Hartsville Cotton Mill v. South Carolina Employment Security Comm., 224 S.C. 407, 79 S.E.2d 381.
4
As noted by the Court, 'The record indicates that of the 150 or more Seventh-day Adventists in the Spartanburg area, only appellant and one other have been unable to find suitable non-Saturday employment.' Ante, p. 399, n. 2.
1
I am completely at a loss to understand note 4 of the Court's opinion. Certainly the Court is not basing today's decision on the unsupported supposition that some day, the South Carolina Supreme Court may conclude that there is some personal reason for unemployment that may not disqualify a claimant for relief. In any event, I submit it is perfectly clear that South Carolina would not compensate persons who became unemployed for any personal reason, as distinguished from layoffs or lack of work, since the State Supreme Court's decisions make it plain that such persons would not be regarded as 'available for work' within the manifest meaning of the eligibility requirements. Not can I understand what this Court means when it says that 'if the eligibility provisions were thus limited, it would have been unnecessary for the (South Carolina) court to have decided appellant's constitutional challenge * * *.'
2
The Court does suggest, in a rather startling disclaimer, ante, p. 409-410, that its holding is limited in applicability to those whose religious convictions do not make them 'nonproductive' members of society, noting that most of the Seventh-day Adventists in the Spartanburg area are employed. But surely this disclaimer cannot be taken seriously, for the Court cannot mean that the case would have come out differently if none of the Seventh-day Adventists in Spartanburg had been gainfully employed, or if the appellant's religion had prevented her from working on Tuesdays instead of Saturdays. Nor can the Court be suggesting that it will make a value judgment in each case as to whether a particular individual's religious convictions prevent him from being 'productive.' I can think of no more inappropriate function for this Court to perform.
3
The Court's reliance on South Carolina Code, § 64—4, ante, p. 406, to support its conclusion with respect to free exercise, is misplaced. Section 64—4, which is not a part of the Unemployment Compensation Law, is an extremely narrow provision that becomes operative only during periods of national emergency and thus has no bearing in the circumstances of the present case. And plainly under our decisions in the 'Sunday law' cases, appellant can derive no support for her position from the State's general statutory provisions setting aside Sunday as a uniform day of rest.
4
Since the Court states, ante, p. 410, that it does not reach the appellant's 'equal protection' argument, based upon South Carolina's emergency Sunday-work provisions, §§ 64—4, 64—6, I do not consider it appropriate for me to do so.
| 23
|
374 U.S. 109
83 S.Ct. 1828
10 L.Ed.2d 778
Edward YELLIN, Petitioner,v.UNITED STATES.
No. 35.
Reargued Dec. 6, 1962.
Decided June 17, 1963.
[Syllabus from pages 109-110 intentionally omitted]
Victor Rabinowitz, New York City, for petitioner.
Archibald Cox, Solicitor Gen., for respondent.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
This contempt of Congress case, stemming from investigations conducted by the House Committee on Un-American Activities, involves, among others, questions of whether the House Committee on Un-American Activities failed to comply with its rules and whether such a failure excused petitioner's refusal to answer the Committee's questions.
2
Petitioner Edward Yellin was indicted in the Northern District of Indiana on five counts of willfully refusing to answer questions put to him by a Subcommittee of the House Committee on Un-American Activities (hereafter Committee) at a public hearing. He was convicted, under 2 U.S.C. § 192, of contempt of Congress on four counts. He was sentenced to four concurrent terms of imprisonment, each for one year, and fined $250. The Court of Appeals for the Seventh Circuit affirmed. 7 Cir., 287 F.2d 292. Since the case presented constitutional questions of continuing importance, we granted certiorari. 368 U.S. 816, 82 S.Ct. 84, 7 L.Ed.2d 23. However, because of the view we take of the Committee's action, which was at variance with its rules, we do not reach the constitutional questions raised.1
3
The factual setting is for the most part not in dispute. The Committee was engaged, in 1958, in an investigation of so-called colonization by the Communist Party in basic industry. One of its inquiries forcused upon the steel industry in Gary, Indiana, where petitioner was employed. Having information that petitioner was a Communist, the Committee decided to call Yellin and question him in a public rather than an executive session. The Committee then subpoenaed petitioner on January 23, 1958. His attorney, Mr. Rabinowitz, sent a telegram to the Committee's general counsel, Mr. Tavenner, on Thursday, February 6, 1958. The telegram asked for an executive session because 'testimony needed for legislative * * * purposes can be secured in executive session without exposing witnesses to publicity.' Since the Committee and Mr. Tavenner had left Washington, D.C., for Gary, the telegram was answered by the Committee's Staff Director. His reply read:
4
'Reurtel (Re your telegram?) requesting executive session in lieu of open session for Edward Yellin and Nicholas Busic. Your request denied.
5
'Richard Arens Staff Director'
6
According to Congressman Walter, the Chairman of the Committee, Mr. Arens did not have authority to take such action.
7
Petitioner's counsel also sought to bring the matter to the Committee's attention when it commenced its public hearing the following Monday, February 10, 1958. His efforts to have the telegrams read into the record were cut short by Congressman Walter.2 Mr. Rabinowitz would not have been justified in continuing, since Committee rules permit counsel only to advise a witness, not to engage in oral argument with the Committee. Rule VII(B). In any event, Congressman Walter was not interested in discussing the content of the telegrams. From his sometimes conflicting testimony at trial, it appears he did not even know what the telegrams said.3 And though Congressman Walter said the Committee would consider in executive session whether to make the telegrams a part of the record, it appears that whatever action was taken was without knowledge of the telegrams' contents.4
8
It is against this background that the Committee's failure to comply with its own rules must be judged. It has been long settled, of course, that rules of Congress and its committees are judicially cognizable. Christoffel v. United States, 338 U.S. 84, 69 S.Ct. 1447, 93 L.Ed. 1826; United States v. Smith, 286 U.S. 6, 52 S.Ct. 475, 76 L.Ed. 954; United States v. Ballin, 144 U.S. 1, 12 S.Ct. 507, 36 L.Ed. 321. And a legislative committee has been held to observance of its rules, Christoffel v. United States, supra, just as, more frequently, executive agencies have been. See, e.g., Vitarelli v. Seaton, 359 U.S. 535, 79 S.Ct. 968, 3 L.Ed.2d 1012; Service v. Dulles, 354 U.S. 363, 77 S.Ct. 1152, 1 L.Ed.2d 1403.
9
The particular Committee Rule involved, Rule IV, provides in part:
10
'IV—Executive and Public Hearings:
11
'A—Executive:
12
'(1) If a majority of the Committee or Subcommittee, duly appointed as provided by the rules of the House of Representatives, believes that the interrogation of a witness in a public hearing might endanger national security or unjustly injure his reputation, or the reputation of other individuals, the Committee shall interrogate such witness in an Executive Session for the purpose of determining the necessity or advisability of conducting such interrogation thereafter in a public hearing.
13
'B—Public Hearings:
14
'(1) All other hearings shall be public.' (Emphasis added.)
15
The rule is quite explicit in requiring that injury to a witness' reputation be considered, along with danger to the national security and injury to the reputation of third parties, in deciding whether to hold an executive session.
16
At the threshold we are met with the argument that Rule IV was written to provide guidance for the Committee alone and that it was not designed to confer upon witnesses the right to request an executive session and the right to have the Committee act, either upon that request or on its own, according to the standards set forth in the rule. It seems clear, from the structure of the Committee's rules and from the Committee's practice, that such is not the case.
17
The rules are few in number and brief—all 17 take little more than six pages in the record. Yet throughout the rules the dominant theme is definition of the witness' rights and privileges. Rule II requires that the subject of any investigation be announced and that information sought be 'relevant and germane to the subject.' Rule III requires that witnesses be subpoenaed 'a reasonably sufficient time in advance' to allow them a chance to prepare and employ counsel. Rule VI makes available to any witness a transcript of his testimony—though at his expense. Rule VII gives every witness the privilege of having counsel advise him during the hearing. Rule VIII gives a witness a reasonable time to get other counsel, if his original counsel is removed for failure to comply with the rules. Rule X makes detailed provision for those persons who have been named as subversive, Fascist, Communist, etc., by another witness. Such persons are given an opportunity to present rebuttal testimony and are to be 'accorded the same privileges as any other witness appearing before the Committee.' Rule XIII permits any witness to keep out of the range of television cameras. Finally, Rule XVII requires that each witness 'shall be furnished' a copy of the rules. All these work for the witness' benefit. They show that the Committee has in a number of instances intended to assure a witness fair treatment, viz., the right to advice of counsel, or protection from undue publicity, viz., the right not to be photographed by television cameras. Rule IV, in providing for an executive session when a public hearing might unjustly injure a witness' reputation, has the same protective import. And if it is the witness who is being protected, the most logical person to have the right to enforce those protections is the witness himself.
18
The Committee's practice reinforces this conclusion. Congressman Walter testified that the Committee 'always' gave due consideration to requests for executive sessions.5 Weight should be given such a practice of the Committee in construing its rules, United States v. Smith, 286 U.S. 6, 33, 52 S.Ct. 475, 477, 76 L.Ed. 954. That the Committee has entertained, and always does entertain, requests for executive sessions reinforces the conclusion that the Committee intended in Rule IV to give the individual witness a right to some consideration of his efforts to protect his reputation.
19
It must be acknowledged, of course, that Rule IV does not provide complete protection. The Committee may not be required by its rules to avoid even unjust injury to a witness' reputation. Assuming that the Committee decides to hold an executive session, to Committee need do so only 'for the purpose of determining the necessity or advisability of conducting such interrogation thereafter in a public hearing.' (Emphasis added.) By inclusion of the word 'necessity' the rule may contemplate cases in which the Committee will proceed in a public hearing despite the risk or even probability of injury to the witness' reputation.6
20
That petitioner may be questioned in public, even after an executive session has been held, does not mean, however, that the Committee is freed from considering possible injury to his reputation. The Committee has at least undertaken to consider a witness' reputation and the efforts a witness makes to protect it, even though the Committee may in its discretion nevertheless decide thereafter to hold a public hearing. The Committee failed in two respects to carry out that undertaking in Yellin's case.
21
First, it does not appear from Congressman Walter's testimony that the Committee considered injury to the witness' reputation when it decided against calling Yellin in executive session:
22
'Q. (By Mr. RABINOWITZ) The Committee does sometimes hold executive sessions, doesn't it?
23
'A. (By Congressman WALTER) Yes.
24
'Q. And what are the considerations which the Committee uses in determining whether to hold executive sessions?
25
'A. This is usually does when the Committee is fearful lest a witness will mention the name of somebody against whom there is no sworn testimony, and in order to prevent the name of somebody being mentioned in public that we are not sure has been active in the conspiracy, at least that there isn't sworn testimony to that effect, we have an executive hearing.
26
'Q. Are those the only circumstances under which executive hearings are held?
27
'A. I don't know of any other, except that where we are fearful that testimony might be adduced that could be harmful to the national defense. We are not so sure about the testimony of any of the witnesses.' (Emphasis added.)
28
By Congressman Walter's own admission, the Committee holds executive sessions in only two of the three instances specified in Rule IV, i.e., when there may be injury to the reputation of a third party or injury to the national security. Injury to the witness himself is not a factor. Consequently the initial Committee decision to question Yellin publicly, made before serving him with a subpoena, was made without following Rule IV.
29
Secondly, the Committee failed to act upon petitioner's express request for an executive session.7 The Staff Director, who lacked the authority to do so, acted in the Committee's stead. That petitioner addressed his request to the Committee's counsel does not alter the case. The Committee did not specify in Rule IV to whom such requests should be addressed. But from other rules it may be inferred that the general counsel is an appropriate addressee. In Rule IX, the Committee permits witnesses to file prepared or written statements for the record. The statements are to be sent to the 'counsel of the Committee.' Rule X makes provision for third parties who have been named as subversive, Fascist, Communist, etc., in a public hearing. A person, notified of having been named, who feels that his reputation has been adversely affected is directed to '(c) ommunicate with the counsel of the Committee.' As a footnote to that rule, the Committee has said: 'All witnesses are invited at any time to confer with Committee counsel or investigators for the Committee prior to hearings.' Also it should be noted that the Staff Director's telegraphed response had the misleading appearance of authority and finality. The Chairman of the Committee should not now be allowed to say that had petitioner disregarded the response he received from the Chairman's staff and instead renewed his request to the Chairman, 'this could not have happened'—especially when petitioner's counsel tried to bring the matter to the attention of the Committee and was brusquely cut off.
30
Thus in two instances the Committee failed to exercise its discretiion according to the standards which Yellin had a right to have considered. His position is similar to that of the petitioner in United States ex rel. Accardi v. Shaughnessy, 347 U.S. 260, 74 S.Ct. 499, 98 L.Ed. 681. Accardi had been ordered deported. Concededly the order was valid. However, Accardi applied to the Board of Immigration Appeals for suspension of the order. This, in the discretion of the Attorney General, was permitted by § 19(c) of the Immigration Act of 1917, 39 Stat. 889, as amended, 8 U.S.C. (1946 ed., Supp. V) § 155(c). (The successor to that section in the 1952 Act is § 244, 66 Stat. 214, 8 U.S.C. s 1254.) The Attorney General had by regulation permitted the Board of Immigration Appeals to make final decisions upon applications for this discretionary relief, subject to certain exceptions not involved in Accardi's case. Shortly before petitioner appealed to the Board, the Attorney General published a list of 'unsavory characters,' including petitioner, who were to be deported. Accardi claimed that since the Board knew he was on the list, it did not exercise the full discretion the Attorney General had delegated to it. Its decision was predetermined.
31
This Court held that the Board had failed to exercise its discretion though required to do so by the Attorney General's regulations. Although the Court recognized that Accardi might well lose, even if the Board ignored the Attorney General's list of unsavory characters, it nonetheless held that Accardi should at least have the chance given him by the regulations.
32
The same result should obtain in the case at bar. Yellin might not prevail, even if the Committee takes note of the risk of injury to his reputation or his request for an executive session. But he is at least entitled to have the Committee follow its rules and give him consideration according to the standards it has adopted in Rule IV.
33
At that point, however, the similarity to Accardi's case ends. Petitioner has no traditional remedy, such as the writ of habeas corpus upon which Accardi relied, by which to redress the loss of its rights. If the Committee ignores his request for an executive session, it is highly improbable that petitioner could obtain an injunction against the Committee that would protect him from public exposure. See Pauling v. Eastland, 109 U.S.App.D.C. 342, 288 F.2d 126, cert. denied, 364 U.S. 900, 81 S.Ct. 233, 5 L.Ed.2d 194. Nor is there an administrative remedy for petitioner to pursue should the Committee fail to consider the risk of injury to his reputation. To answer the questions put to him publicly and then seek redress is no answer. For one thing, his testimony will cause the injury he seeks to avoid; under pain of perjury, he cannot by artful dissimulation evade revealing the information he wishes to remain confidential. For another, he has no opportunity to recover in damages, U.S.Const., Art. I, § 6; Kilbourn v. Thompson, 103 U.S. 168, 201—205, 26 L.Ed. 377. Cf. Tenney v. Brandhove, 341 U.S. 367, 377, 71 S.Ct. 783, 788, 95 L.Ed. 1019. Even the Fifth Amendment is not sufficient protection, since petitioner could say many things which would discredit him without subjecting himself to the risk of criminal prosecution. The only avenue open is that which petitioner actually took. He refused to testify.
34
As a last obstacle, however, the Government argues that Yellin's rights were forfeited by his failure to make clear at the time he was questioned that his refusal to testify was based upon the Committee's departure from Rule IV. Whatever the merits of the argument might be when immediately apparent deviations from Committee rules are involved,8 it has no application here. Yellin was unable, at the time of his hearing, to tell from the actions of the Committee that his rights had been violated. So far as Yellin knew, the Staff Director acted as Congressman Walter's agent, announcing the results of the Committee's deliberations. And so far as he knew, the Committee, when it initially decided to hold a public hearing, did so in accordance with Rule IV. It was not until petitioner's trial, when his attorney for the first time had an opportunity for searching examination, that it became apparent the Committee was violating its rules.
35
It may be assumed that if petitioner had expressly rested his refusal to answer upon a violation of Rule IV and the Committee nevertheless proceeded, he would be entitled to acquittal, were he able to prove his defense. Otherwise, if Yellin could be convicted of contempt of Congress notwithstanding the violation of Rule IV, he would be deprived of the only remedy he has for protecting his reputation. Certainly the rights created by the Committee's rules cannot be that illusory.
36
Of course, should Yellin have refused to answer in the mistaken but good-faith belief that his rights had been violated, his mistake of law would be no defense. Watkins v. United States, 354 U.S. 178, 208, 77 S.Ct. 1173, 1189, 1 L.Ed.2d 1273; Sinclair v. United States, 279 U.S. 263, 299, 49 S.Ct. 268, 273, 73 L.Ed. 692. But he would at least be entitled to submit the correctness of his belief to a court of law.
37
Yellin should be permitted the same opportunity for judicial review when he discovers at trial that his rights have been violated. This is especially so when the Committee's practice leads witnesses to misplaced reliance upon its rules. When reading a copy of the Committee's rules, which must be distributed to every witness under Rule XVII, the witness' reasonable expectation is that the Committee actually does what it purports to do, adhere to its own rules. To foreclose a defense based upon those rules, simply because the witness was deceived by the Committee's appearance of regularity, is not fair. The Committee prepared the groundwork for prosecution in Yellin's case meticulously. It is not too exacting to require that the Committee be equally meticulous in obeying its own rules.
38
Reversed.
39
Mr. Justice WHITE, with whom Mr. Justice CLARK, Mr. Justice HARLAN and Mr. Justice STEWART join, dissenting.
40
Petitioner stands convicted of having refused, in violation of 2 U.S.C. § 192,1 to answer four questions asked him by the Committee on Un-American Activities of the House of Representatives. He was sentenced to one year on each count, the sentences to run concurrently, and a fine of $250. The Court of Appeals affirmed unanimously, 7 Cir., 287 F.2d 292.
41
Pursuant to House of Representatives Rules XI2 and XII,3 the Committee resolved that hearings would be held in Gary, Indiana, to inquire into Communist Party activities in basic industry.4 Petitioner was subpoenaed to appear before the Committee in Gary on February 10, 1958. Four days prior to the hearing, petitioner's counsel sent a telegram to the Committee's counsel requesting that petitioner be questioned in executive session in lieu of an open session. The Staff Director of the Committee responded the same day and denied the request.
42
Petitioner appeared on the appointed date with counsel. The Committee Chairman began the proceedings by reading the above-quoted resolution and by stating further the purposes of the inquiry.5 The first witness, an organizer and high official in the Communist Party from 1930 to 1950, testified that the Party had begun a policy of infiltrating into basic industry, that Party 'colonizers' were sent to coordinate Party work in these industries, including the steel industry, and that these collonizers were mainly young men from colleges and universities. These colonizers, he continued, would misrepresent their backgrounds in applying for jobs and would conceal their educational qualifications so as to gain jobs alongside other less-educated workers without casting suspicion on their motives.
43
Petitioner, who had been present for all of the foregoing, was called as the second witness immediately thereafter. After answering preliminary questions as to his name and address and after his counsel requested that the exchange of telegrams concerning the executive session be made part of the record, petitioner was asked the following question:
44
'Mr. Yellin, where did you reside prior to September 1957?' (Count 1.)
45
After conferring with counsel, petitioner refused to answer the question. He cited decisions of this Court in Watkins v. United States, 354 U.S. 178, 77 S.Ct. 1173, 1 L.Ed.2d 1273; Sweezy v. New Hampshire, 354 U.S. 234, 77 S.Ct. 1203, 1 L.Ed.2d 1311, and asserted that a congressional committee cannot investigate into areas protected by the First Amendment and into areas of personal belief and conscience, that the authorizing rule of the House of Representatives was unduly vague resulting in a denial of due process of law and that the questions he would answer would only be those pertinent to some legislation. He specifically disclaimed reliance on the privilege against self-incrimination. To indicate the pertinency of the question, the Committee's counsel stated that in order to learn anything from petitioner regarding Communist Party activities in the Gary area, it was necessary to know whether he was there over a period of time. When directed to answer the question after this statement, the petitioner again refused on the grounds above stated.
46
Petitioner was then asked to state his formal education and whether he was a student at the College of the City of New York, which he refused to do and, when directed to answer, added: 'Mr. Tavenner, I will refuse to answer that question under the grounds already stated; but it just occurs to me that if the committee knows all these things, I can't see the purpose or the pertinency of asking me what they consider a known fact. Furthermore, it kind of appears to me as if this line of questioning is merely trying to create an impression and expose me for the sake of merely exposing me and not leading to any valid legislative purpose.' The Committee Chairman, in response, stated: 'I will assure you that that is farthest from the intention of anybody on this committee, and this committee has never, for the mere sake of exposing, asked a question.'
47
The Committee thereupon received in evidence copies of petitioner's college records showing that he transferred from the College of the City of New York to the University of Michigan in 1948 and that he had applied for employment in a Gary steel mill on June 23, 1949. After continued unproductive questioning, petitioner was asked:
48
'Will you tell the committee, please, whether or not incidents came to your attention of the colonization of the steel unions in Gary by the Communist Party at any time prior to September 1957?' (Count 2.)
49
Following another refusal to answer, the Committee's counsel undertook to explain the purpose of the question.6 Again petitioner declined to reply for the reasons he had given. In a similar vein, he refused to answer a good many other questions including the following two:
50
'Were you a member of the Communist Party on the 23d day of June 1949, which is the date of application filed in your name for employment in Gary?' (Count 3.)
51
'Will you tell the committee whether or not in 1957 there were present in any of the steel unions at Gary, Indiana, persons who were known to you to have been colonizers of the Communist Party?' (Count 4.)
52
Petitioner was excused and various other witnesses were called, among them Joseph E. LaFleur who joined and had been active in the Communist Party from 1942 to 1952 at the request of the Federal Bureau of Investigation and who worked in the steel mills in Gary at times pertinent to this inquiry. He identified petitioner as a member of the Communist Party who with other young men participated in organizing Communist Party activities in Gary.
53
Upon report and recommendation by the Committee, petitioner was cited for contempt by the House of Representatives and was indicted and tried for refusing to answer the four questions designated above by count numbers. The sole government witness at the trial was the Committee's counsel who testified that the purpose of the hearings was to find out how serious the Communist propaganda infiltration was in basic industry, particularly in the steel industry. The Committee wanted information on this subject, he stated, to decide whether to amend various Acts of Congress and, in fact, members of the Committee did introduce several bills around the time of these hearings.7 Prior to calling petitioner, he continued, the Committee had information that petitioner was a member of the Communist Party while at the University of Michigan, that he had applied for employment in Gary without disclosing his college education and that he had been employed in the steel industry in Gary.
54
The Committee Counsel emphasized that petitioner was summoned with the hope that he would cooperate and that the Committee believed petitioner had information about the colonization activities which had not been presented by any of the other witnesses. 'We know nothing about the actual activities of the Communist Party in the steel plants in Indiana as of the time of this hearing, or shortly before Mr. LaFleur, who did testify (at the Gary hearings), according to my recollection got out of the Communist Party in 1950. This witness, Mr. Yellin, as to whom we had testimony by several people, had been a member of the Communist Party at Michigan University, and had left there and come down and taken employment in Gary.'8
55
With respect to the denial of the request for an executive hearing, Committee Counsel testified as follows:
56
'Q. (By Mr. Rabinowitz.) Then why did you not comply with the request for an executive session?
57
'A. (By Committee Counsel.) * * * With the information that the Committee had regarding his membership, I would not have recommended—I will say this—I would not have recommended to the Committee, if they had asked, that he be heard in executive session.
58
'Q. Why not?
59
'A. Because we knew that he was a member of the Communist Party and he was in a position to give the Committee information, if he wanted to.
60
'Q. You knew he had been a member of the Communist Party?
61
'A. Yes.
62
'Q. Many years before?
63
'A. Yes.
64
'Q. You didn't know whether he still was?
65
'A. If you had come and told me, now, this man has considerable information that he wants to give, that involves other people, and it ought to be thoroughly investigated before being made public, I would certainly have recommended that he be heard in executive session, but you never indicated that he was willing to do anything.
66
'Q. I did indicate that he wanted an executive session, though, didn't I?
67
'Q. I say in the way of giving testimony.
68
'Q. And you did not feel that it was advisable to call an executive session for the purpose of determining whether he was prepared to give testimony, or not?
69
'A. My recollection is that he was sworn in as a witness, and you were sitting by his side, and at the beginning of the testimony you asked that we make a part of the record the telegrams which you had sent to the Committee. You didn't offer any suggestion then that he would give any information that would be of such a character that it ought to be taken in executive session to protect anybody while we were investigating to see whether the witness was telling the truth, or not.'
70
Representative Walter of Pennsylvania, the Chairman of the House Un-American Activities Committee and of the Subcommittee which conducted the hearings in Gary, was called by petitioner. As far as he could recall, he did not know of petitioner's telegram asking for an executive session until the opening of the hearing in Gary. He pointed out that the telegram was not addressed to him and he had already departed for Gary when the telegram arrived. He stated that neither the Committee Counsel nor the Staff Director had authority to pass on a request for an executive session and that when the matter of the telegram was raised at the hearings 'it was too late then to raise any question that might have been raised by the telegram.' When asked to explain, he said: 'Well, the Committee already passed on the question of whether or not we would hear Mr. Yellin at a session when the purpose of calling him was discussed, and it was decided then that the rule with respect to an executive session was not applicable because the investigator—and I might say it was Mr. Collins, a former F.B.I. agent, who developed this entire matter, and we were willing to accept his story with respect to the proposed testimony.' Mr. Collins' story, according to Chairman Walter, was 'that the man was a known Communist; that he had been active in the international conspiracy, and that he had deceived his employer; and, furthermore, he came within the category of those people that we were experiencing a great deal of difficulty in finding out about with respect to the colonization.' Congressman Walter further testified that petitioner's counsel at the hearing in Gary 'didn't even there inform me as to the contends of the telegrams,' which had not been sent to him, and also acknowledged that he had interrupted petitioner's counsel since 'it is not the practice of the Committee to hear counsel, and that the function of counsel at Committee hearings is solely to confer with witnesses.'
71
When asked to state the considerations which the Committee uses in determining whether to hold executive sessions, Chairman Walter explained: 'This is usually done when the Committee is fearful lest a witness will mention the name of somebody against whom there is no sworn testimony, and in order to prevent the name of somebody being mentioned in public that we are not sure has been active in the conspiracy, at least that there isn't sworn testimony to that effect, we have an executive hearing.' He was aware that many witnesses refused to testify but 'it is always worth a chance that somebody will testify * * * occasionally we are very pleasantly surprised at having somebody give us information that is of great value in the drafting of legislation.'
72
Petitioner's challenge to his conviction is predicated upon, among other matters,9 the claim that by the rules of the Committee he was improperly denied an executive session or at the very least a good-faith consideration of his request for one.
I.
73
Since petitioner did not refuse to testify at the hearing on the ground that it was a public rather than a private session, it is my view that he is not entitled, at this late stage, to rely upon the Committee's alleged failure to apply its executive session rule to him.
74
As the courts have repeatedly held, to be available as a defense in a contempt of Congress trial, an objection must have been relied upon and asserted before the congressional committee. United States v. Bryan, 339 U.S. 323, 332—333, 70 S.Ct. 724, 731, 94 L.Ed. 884; United States v. Fleischman, 339 U.S. 349, 352, 70 S.Ct. 739, 741, 94 L.Ed. 906; Barenblatt v. United States, 360 U.S. 109, 123—125, 79 S.Ct. 1081, 1091—1092, 3 L.Ed.2d 1115; McPhaul v. United States, 364 U.S. 372, 81 S.Ct. 138, 5 L.Ed.2d 136; Eisler v. United States, 83 U.S.App.D.C. 315, 170 F.2d 273; Hartman v. United States, 290 F.2d 460 (C.A.9th Cir.); United States v. Kamin, D.C., 136 F.Supp. 791. This is no technical quibble, for there are compelling reasons to require an objection to be pursued before the Committee. It serves the administration of justice to have objections seasonably made in order that asserted errors may be corrected at the earliest possible time. As is the case in proceedings before a trial court, 1 Wigmore (3d ed. 1940) § 18, at 322, the objecting party is required to state his position and afford an opportunity to act upon his claim. 'The practice of withholding all objection until time of trial is not helpful in protecting a witness' right to a valid (hearing). It prevents correction of any error in that respect and profits only the witness who seeks a concealed defect to exploit.' United States v. Bryan, supra, 339 U.S. at 344, 70 S.Ct. at 737 (concurring opinion). Accordingly, if possible damage to petitioner's reputation was a ground for his demanding an executive session under the Committee's rules and for his refusal to answer questions put to him by the Committee, 'a decent respect for the House of Representatives * * * would have required that (he) state (his) reasons * * *. To deny the Committee the opportunity to consider the objection or remedy it is in itself a contempt of its authority and an obstruction of its processes.' Id., 339 U.S. at 332—333, 70 S.Ct. at 731.
75
There is certainly nothing in petitioner's telegram10 which makes out a substantial demand for an executive session. It contains simply the request itself and the unsupported conclusion of petitioner's counsel, who, without knowing the extent or direction of the investigation, insists that petitioner's questioning could as well be conducted in executive session. There is no mention of the Committee rule or the particular grounds upon which the request was founded, nor are there any factual assertions to bring to light considerations which under the rule would call for the executive session, such as facts showing potential damage to his reputation. Indeed, it is difficult to understand how petitioner, at the time of the request, could have anticipated any ground for an executive session under the rule since he had no way of knowing what questions would be asked of him. It was not at all unlikely that petitioner would be called, like any other employee working in the steel mills at that time irrespective of Communist Party affiliation to relate what instances of infiltration he observed while at work. See Question, ante, p. 129. Moreover, the wire was directed to one without authority to grant or deny an executive session and was sent only four days prior to the hearings and after the Subcommittee had departed for Gary.
76
At the opening of the hearing, Chairman Walter was entirely unfamiliar with the contents of the Wire. And the exchange which occurred at that time, set out in the margin,11 can hardly be construed as a denial of a pointed request for an executive session based upon possible injury to Yellin's reputation. To be sure, Chairman Walter cut off petitioner's counsel immediately, but in terminating the discussion with counsel, the Chairman was simply making it clear that counsel's function before the Committee was to confer with the witness and not to argue with the Committee, which is in accordance with the Committee's rules. It was for the witness, with the help of his attorney, to answer the questions or to state his grounds for refusing to do so. The Chairman in no way indicated that the witness could not take up where counsel had left off.
77
As the immediately ensuing questioning reveals,12 petitioner had every opportunity to state his reasons for refusing to answer and every opportunity to confer with counsel. But the grounds which petitioner then gave for not answering the Committee's questions were based principally upon the First Amendment and were not grounded upon Rule IV—A, upon an alleged right to testify in private rather than in public or upon injury to his reputation.
78
More than once during the hearing the Committee took particular pains to ascertain the precise grounds upon which petitioner was refusing to testify. And on more than one occasion petitioner expanded and enlarged upon his reasons for not answering the Committee's questions. At no time, however, did he mention Rule IV—A or the matter of an executive session or specify how his reputation might be injured in a public hearing. Quite the contrary, when petitioner at one point asserted that he could not 'see the purpose or the pertinency of asking me what they consider a known fact * * * it kind of appears to me as if this line of questioning is merely trying to create an impression and expose me for the sake of merely exposing me and not leading to any valid legislative purpose,' Chairman Walter assured him that the Committee had never asked questions for the mere sake of exposing and then inquired: 'And now I would like to ask you: What do you mean by exposing you? Exposing you to what?' Petitioner's answer was entirely unresponsive. He did not explain how he would be exposed or injured and instead launched upon a discussion of academic freedom. At another point, when petitioner said: 'I don't like to have my loyalty questioned or my character questioned,' Chairman Walter said: 'Isn't this the best place to clarify the atmosphere? If you feel as you say you do, and I am sure that you do, is this not a great opportunity to eliminate whatever question might be in anybody's mind, particularly mine, about your activities?' Petitioner's answer was to decline to discuss himself. He did not accept the invitation to say how or in what manner his reputation would be unjustly injured by testifying in public.
79
Even if there could be sifted from this record a bona fide assertion of a right to an executive session and a refusal to answer based upon that ground, petitioner consistently relied upon other grounds as well and it would sweep away much established law in this Court to give his claim to an executive session any practical significance. Petitioner's central thesis and repeated reasons for not responding to questions put to him by the Committee were based upon the First Amendment. These grounds were firmly and clearly put and petitioner in no way indicated that an executive session would have made any difference in his willingness to answer questions.
80
The Court considered a similar situation in United States v. Bryan, 339 U.S. 323, 70 S.Ct. 724, 94 L.Ed. 884, in connection with the same congressional committee. There, the witness at her trial for contempt asserted that her failure to produce records at the hearing was excusable because there was not a quorum present, but that ground was held unavailable because she had relied upon other grounds at the hearing. 'Testimonial compulsion is an intensely practical matter. * * * (T)he fact that the alleged defect upon which respondent now insists is, in her own estimation, an immaterial one, is clearly shown by her reliance before the Committee upon other grounds for failing to produce the records. She does not deny, and the transcript of the hearing makes it perfectly clear, that she would not have complied with the subpoenas no matter how the Committee had been constituted at the time.' Explaining an analogous case, Hale v. Henkel, 201 U.S. 43, 26 S.Ct. 370, 50 L.Ed. 652, the Bryan Court noted that the witness in Hale, 'having refused compliance for other reasons which the lower court could not remedy * * * could not later complain of its refusal to do a meaningless act—to grant him additional time to gather papers which he had indicated he would not produce in any event. Here respondent (Bryan) would have the Committee go through the empty formality of summoning a quorum of its members to gather in solemn conclave to hear her refuse to honor its demands.' United States v. Bryan, supra, 339 U.S. at 334, 70 S.Ct. at 732.13
81
Petitioner was represented at the hearing before the Committee by experienced counsel, the same counsel who represented the witness in the Bryan case. It is difficult to believe that if petitioner was in fact refusing to answer because he was called at a public hearing instead of an executive session, express reliance upon the Committee rule would not appear in the record along with the supporting reasons. Rather, it is far more likely that petitioner preferred to include among his several reasons for refusing to answer the ground that the Committee was seeking only to expose him for exposure's sake. See Watkins v. United States, 354 U.S. 178, 187, 200, 77 S.Ct. 1173, 1185, 1 L.Ed.2d 1273; Sweezy v. New Hampshire, 354 U.S. 234, 77 S.Ct. 1203, 1 L.Ed.2d 1311; NAACP v. Alabama ex rel. Patterson, 357 U.S. 449, 78 S.Ct. 1163, 2 L.Ed.2d 1488. It would have weakened if not destroyed that ground if petitioner based his refusal to testify on the executive session ground and had been granted a private hearing. Quite plainly petitioner was seeking to keep his constitutional grounds intact.
82
It is no answer to say that this rule of diligence can be relaxed here because petitioner was not aware until the trial that the Committee might have ignored its own rules in deliberating upon whether or not to question him in private. The point is that if petitioner has any standing to complain about the manner in which the Committee acted, it must be because he asserted at the Committee hearing, when matters were still open to direct explanation and correction, that he would suffer unjust damage to his reputation by a public session and that he had a right under the rules of the Committee to have his reputational interest considered. Compare Watkins v. United States, 354 U.S. 178, 77 S.Ct. 1173, 1 L.Ed.2d 1273, and Sweezy v. New Hampshire, 354 U.S. 234, 77 S.Ct. 1203, 1 L.Ed.2d 1311, where the specific grounds sustained by the Court were vigorously asserted at the hearing. The Committee is obliged to make clear the demands which it makes upon the witness. Quinn v. United States, 349 U.S. 155, 75 S.Ct. 668, 99 L.Ed. 964. There surely must be a reciprocal obligation on the part of the witness to advise the Committee of the precise grounds for his silence.
II.
83
In any event, however, the Committee did not, as petitioner contends, fail to apply its executive session rule to him.
84
Article I, § 5, cl. 2, of the Constitution provides that 'Each House may determine the Rules of its Proceedings.' The role that the courts play in adjudicating questions involving the rules of either house must of necessity be a limited one, for the manner in which a house or committee of Congress chooses to run its business ordinarily raises no justiciable controversy. Field v. Clark, 143 U.S. 649, 12 S.Ct. 495, 36 L.Ed. 294; United States v. Ballin, 144 U.S. 1, 12 S.Ct. 507, 36 L.Ed. 321; Leser v. Garnett, 258 U.S. 130, 137, 42 S.Ct. 217, 66 L.Ed. 505; cf. Flint v. Stone Tracy Co., 220 U.S. 107, 143, 31 S.Ct. 342, 345, 55 L.Ed. 389. However, when the application or construction of a rule directly affects persons other than members of the house, 'the question presented is of necessity a judicial one.' United States v. Smith, 286 U.S. 6, 33, 52 S.Ct. 475, 478, 76 L.Ed. 954; Christoffel v. United States, 338 U.S. 84, 69 S.Ct. 1447, 93 L.Ed. 1826. Even when a judicial controversy is presented, the function of the courts is a narrow one. 'With the courts the question is only one of power. The constitution empowers each house to determine its rules of proceedings. It may not by its rules ignore constitutional restraints or violate fundamental rights, and there should be a reasonable relation between the mode or method of proceeding established by the rule and the result which is sought to be attained. But within these limitations all matters of method are open to the determination of the house, and it is no impeachment of the rule to say that some other way would be better, more accurate or even more just.' United States v. Ballin, supra, 144 U.S. at 5, 12 S.Ct. at 509; United States v. Smith, supra.
85
The Committee, pursuant to enabling resolutions of the House of Representatives in exercise of that rule-making power, promulgated its rules of procedure, number IV—A of which is in issue here:
86
'IV—Executive and Public Hearings:
87
'A—Executive:
88
'(1) If a majority of the Committee or Subcommittee, duly appointed as provided by the rules of the House of Representatives, believes that the interrogation of a witness in a public hearing might endanger national security or unjustly injure his reputation, or the reputation of other individuals, the Committee shall interrogate such witness in an Executive Session for the purpose of determining the necessity or advisability of conducting such interrogation thereafter in a public hearing.
89
'(2) Attendance at Executive Sessions shall be limited to Members of the Committee, its staff, and other persons whose presence is requested, or consented to by the Committee.
90
'(3) All testimony taken in Executive Sessions shall be kept secret and shall not be released or used in public sessions without the approval of a majority of the Committee.'
91
Petitioner's claim is that in deciding to hold a public hearing in his case rather than to take his testimony in executive session, the Committee failed to give him the full benefit of the rule because it did not consider whether 'interrogation of a witness in a public hearing might * * * unjustly injure his reputation' and instead considered only injury to the reputation of other individuals. I find this contention wholly without substance.
92
My understanding of the testimony in trial court is that when a witness before the Committee may implicate third persons about whom the Committee does not have reliable information, an executive session is held. In terms of Rule IV—A an executive session is afforded in these circumstances because an open hearing 'might * * * unjustly injure * * * the reputation of other individuals.' It is otherwise and a closed session is not required when the Committee has adequate and reliable information about the other individuals the witness may mention, for their reputation would not then be 'unjustly injured' by revealing verified information in a public session.
93
The same considerations apply to the witness himself. 'Certainly,' as Mr. Tavenner testified, the rule operates for the benefit of the party testifying. See Opinion of the Court, ante, p. 116, n. 5. According to both Mr. Tavenner and Mr. Walter, Yellin was denied an executive session under the rule because he was a known Communist and the Committee had sworn testimony to this effect. The Committee believed the information furnished by its investigators about Yellin to be reliable. Measured against the plain terms of Rule IV—A, these facts did not call for a closed session. There was sworn testimony or other proof to back up the questions to be asked. There would be no 'unjust injury' to the reputation of the witness Yellin. Publicly interrogating a witness if the Committee's foundation for its questions rests only upon suspicion or rumor falls within the area of unjust injury to reputation. But public revelation of the truth does not.
94
The foregoing appears to me to be the construction which the Committee placed upon its own rules and as so construed it was applied here. It is true that in stating generally the considerations entering into the holding of an executive session, Mr. Walter said that private hearings are 'usually' granted when third persons may be mentioned against whom there is no sworn testimony and that he did not know of any other considerations. But this general remark is, at best, ambiguous and is supplemented by his previous statements concerning the Committee's decision to hold a public hearing in petitioner's own case. That decision, according to his testimony, plainly was based upon the Committee's appraisal of its information about petitioner. Yellin was not denied an executive session because there was no indication of injury to third persons. The considerations underlying the denial were peculiar to Yellin himself. In the Committee's view, its information about him was reliable and adequate, his reputation would not be unjustly injured and he was therefore not entitled to a closed session. The Committee did not, as petitioner urges, fail to consider any element of its rule when it determined to interrogate him in a public hearing.
95
While the testimony is reasonably clear as to the Committee's construction and application of its own rule, if there were any doubt about the matter it is not our place to resolve every doubt against the Committee. 'The presumption in favor of regularity, which applies to the proceedings of courts, cannot be denied to the proceedings of the houses of Congress, when acting upon matters within their constitutional authority.' Barry v. United States ex el. Cunningham, 279 U.S. 597, 619, 49 S.Ct. 452, 457, 73 L.Ed. 867. See also McGrain v. Daugherty, 273 U.S. 135, 179—180, 47 S.Ct. 319, 330, 71 L.Ed. 580; In re Chapman, 166 U.S. 661, 670, 17 S.Ct. 677, 680, 41 L.Ed. 1154. Cf. Tenney v. Brandhove, 341 U.S. 367, 378, 71 S.Ct. 783, 789, 95 L.Ed. 1019. Due regard for the legislative branch of the Government requires a considerably clearer showing than what is offered here that the long-time Chairman of the Committee did not know his own rules when he testified that the Committee had considered the request for an executive session and determined that the rule did not require it.
96
The Committee's construction of its own rules is entitled to great weight. United States v. Smith, 286 U.S. 6, 52 S.Ct. 475, 76 L.Ed. 954; Christoffel v. United States, 338 U.S. 84, 69 S.Ct. 1447, 93 L.Ed. 1826. 'To place upon the standing rules of the (Congress) a construction different from that adopted by the (Congress) * * * is a serious and delicate exercise of judicial power.' United States v. Smith, supra, 286 U.S. at 48, 52 S.Ct. at 483. Here, the Committee under its rule does not deem it to be unjust injury where the truth about the witness or a third person is brought out in a public hearing in pursuance of a valid legislative purpose. This reading of Rule IV—A is not bizarre, irrational or so out of keeping with history as to permit a court to ignore it because it would prefer a different construction or an entirely different rule. The House of Representatives has its own rule concerning executive sessions, Rule XI(m), which, according to the testimony at petitioner's trial and as contrasted with the rule of the Committee, has been construed by the House to afford no protection at all to the witness himself. Moreover, § 103 of the Revised Statutes, as amended, 2 U.S.C. § 193 provides that '(n)o witness is privileged to refuse to testify to any fact * * * upon the ground that his testimony to such fact * * * may tend to disgrace him or otherwise render him infamous.' Whatever other problems may inhere in the rule of the Committee, of the House or in the statute, the Committee's construction of its own rule heralds no break with the tradition of the House or of Congress in affording privacy to a witness when the hearing may be a fishing expedition or an inquiry into mere rumor but permitting a public session when the matter to be brought out is both pertinent to a legislative purpose and nothing but the unvarnished truth. 'The Constitution commits to the (House) the power to make its own rules; and it is not the function of the Court to say that another rule would be better.' United States v. Smith, supra, 286 U.S. at 48, 52 S.Ct. at 483.
97
Nor is there substance in petitioner's claim that the Committee erroneously failed to act upon the telegraphic request. Under the rule, all that is required is that the Committee consider whether to hold the session in an executive hearing. Cf. United States ex rel. Accardi v. Shaughnessy, 347 U.S. 260, 74 S.Ct. 499, 98 L.Ed. 681. Here, the Committee on its own motion, even before the telegram was transmitted, had given full consideration to whether petitioner should be questioned in private. Whatever would have been the prejudice resulting from disregarding the telegram and totally failing to consider whether the questioning should be conducted in secret, there is no room for complaint on this record since the Committee had already deliberated on the matter. Once it made its assessment, as it did here, it discharged any obligation which its own rules imposed.
III.
98
If '(t)estimonial compulsion is an intensely practical matter' and '(e)very exemption from testifying or producing records thus presupposes a very real interest to be protected,' United States v. Bryan, 339 U.S., at 332, 70 S.Ct., at 731, much of this discussion is really beside the point. Petitioner was convicted for refusing to answer four questions, each refusal constituting a separate count in the indictment. He was found guilty on all four counts, his sentences to run concurrently. His conviction must stand if his refusal to answer any one of the questions was unjustified. Claassen v. United States, 142 U.S. 140, 147, 12 S.Ct. 169, 170, 35 L.Ed. 966; Hirabayashi v. United States, 320 U.S. 81, 85, 63 S.Ct. 1375, 1378, 87 L.Ed. 1774; Barenblatt v. United States, 360 U.S. 109, 115, 79 S.Ct. 1081, 1087, 3 L.Ed.2d 1115. The first question which petitioner refused to answer was: 'Mr. Yellin, where did you reside prior to September 1957?' Petitioner refused to respond because to him it was obvious where 'this line of questioning will probably lead' and, expressly disclaiming Fifth Amendment protection, declined to answer on First Amendment grounds.
99
Petitioner's conviction on Count 1 should stand quite independently as against the claim to an executive session for it is difficult indeed to ascribe any reality to the view that petitioner may not be compelled, in a public hearing held by a legislative committee in pursuit of information pertinent to a legislative purpose, to answer, or to refuse to answer, a question about his residence prior to 1957 because of danger to his reputation. Oversight of congressional committee procedures should not be based upon such frivolous grounds.
100
In my view, petitioner's executive session argument is totally without support, and therefore I dissent.
1
The constitutional questions upon which we need not pass are whether the Committee's investigation infringed upon petitioner's rights under the First Amendment and whether petitioner was convicted under an unconstitutionally vague statute. In addition, we do not discuss petitioner's contention that the trial judge erred in excluding expert testimony about the factors which should be considered in determining petitioner's rights under the First Amendment.
2
The Committee's General Counsel had asked Mr. Yellin a few preliminary questions when Mr. Rabinowitz interrupted.
'Mr. RABINOWITZ. Mr. Counsel (Mr. Tavenner), I wonder whether it would be possible to read into the record the exchange of telegrams between myself and the committee in connection with the witness's testimony. I would like to have it appear in the record.
'The CHAIRMAN. We will decide whether it will be made a part of the record when the executive session is held. Go ahead.
'Mr. RABINOWITZ. Mr. Chairman, I sent the telegrams because I wanted them to appear. I do not care whether they appear publicly or not. I do want it to appear that that exchange of telegrams occurred. I did not do it just to increase the revenue of the telegram company.
'The CHAIRMAN. Well, whatver the reason was, whether it has been stated or otherwise, it will be considered in executive session.
'Mr. RABINOWITZ. May I state—
'The CHAIRMAN. Do not bother. You know the privileges given you by this committee. You have appeared before it often enough. You know as well as anybody. Go ahead, Mr. Tavenner.'
3
Consider, for example, the following testimony of Congressman Walter:
'Q. (By Mr. RABINOWITZ) So that at the time I raised at this hearing the question of the telegrams, you didn't know anything about any telegrams, and you weren't sufficiently interested to find out what I was talking about; is that right?
'A. (By Congressman WALTER) Well, not exactly that, Mr. Rabinowitz. I was interested in knowing. I knew that you made an application for an executive session.
'Q. How did you know that?
'A. Well, the telegram; at least, that's what you started to talk about.
'Q. You knew it at the time of the hearing?
'A. No. Isn't that what you started to talk about?
'Q. When did you first learn that I had made an application for an executive session?
'A. I believe today. I never had seen these telegrams, actually. I heard you mention them, at least now my recollection is that I heard you mention them, but I haven't seen them until this minute.' (Emphasis added).
See also the following testimony:
'Q. (By Mr. RABINOWITZ) Well, weren't you interested in finding out what I was talking about?
'A. (By Congressman WALTER) I knew what you were talking about. You were talking about a telegram that you say you sent, and it was too late then to raise any question that might have been raised by the telegram.'
Later Congressman Walter said:
'I think the impression I got was that these were telegrams that were more or less in the nature of a request to postpone, without grounds, or whatever it was that Mr. Tavenner told me and the other members of the Committee; and I think that we were just not impressed by it.'
4
The following occurred during Mr. Rabinowitz' direct examination of Congressman Walter:
'Q. Well, did you, or did you not, take it up in executive session as you said you would?
'A. I am not clear; I think that we probably did talk about making it a part of the record, and I think the conclusion was reached that it was not properly a part of the record already made.
'Q. Didn't you testify, Congressman, just a few minutes ago, while you were on the stand, that the first you knew about the contents of the telegram was just now, when you got on the witness stand?
'A. That's right.
'Q. So you discussed this whole matter in executive session after the Gary hearings, without even knowing what the telegrams said?
'A. That's about it.
'Q. And you reached the conclusion not to make them a part of the record without even knowing what was in them?
'A. That's right. * * *'
5
Mr. Rabinowitz asked Congressman Walter:
'But it wasn't worth the chance of calling him in executive session, to see what his position would have been?
'A. I am sure that had you communicated this whole matter to the Committee before we left Washington so that we could have given it due consideration—we would have, and always do—we might have a different situation today.' (Emphasis added.)
Congressman Walter also said he was 'sure this could not have happened, had you (Mr. Rabinowitz) addressed your telegram to me.'
Note also the following question by Mr. Rabinowitz and answer by Mr. Tavenner:
'Q. And does that rule (Rule IV) operate ever for the protection of a witness who is called?
'A. Certainly.'
6
Although, for reasons to be developed later, it does not appear that the Committee was following Rule IV in Yellin's case, it seems clear that the Committee realized its public interrogation of Yellin would injure his reputation. Congressman Walter testified, for example, that:
'A. * * * (T)he Committee already passed on the question of whether or not we would hear Mr. Yellin at a session when the purpose of calling him was discussed, and it was decided then that the rule with respect to an executive session was not applicable because the investigator—and I might say it was Mr. Collins, a former F.B.I. agent, who developed this entire matter, and we were willing to accept his story with respect to the proposed testimony.
'Q. And what was his story?
'A. Well, his story was that the man was a known Communist; that he had been active in the international conspiracy, and that he had deceived his employer; and, furthermore, he came within the category of those people that we were experiencing a great deal of difficulty in finding out about with respect to the colonization.'
Mr. Tavenner also said he would not have recommended to the Committee that Yellin be heard in executive session '(b)ecause we knew that he was a member of the Communist Party and he was in a position to give the Committee information, if he wanted to.'
From the Committee's knowledge, whether it be reliable or not, the Committee could only have concluded that Yellin's reputation would suffer. Yet Congressman Walter said this was the kind of case in which a public hearing was appropriate.
7
Any suggestion that petitioner's request was untimely cannot be accepted. For one thing, only 14 days intervened between service of the subpoena upon petitioner and delivery of his request to the Committee's offices in Washington. Also it is of some significance that the Committee did not hold another witness at the Gary hearings, one Joseph Gyurko, to the strict standard of timeliness now urged. Gyurko had sent a telegram to the Committee's offices in Washington about noon on Saturday, February 8, 1958. When Gyurko was called on Tuesday, February 11, he was given an executive hearing, even though Congressman Walter expressed the opinion that Gyurko had deliberately waited until after business hours on Saturday to send his request. Since the Committee did not even-handedly deny executive sessions to all who made such eleventh hour requests, it is not in a fair position to plead the untimeliness of Yellin's request.
8
Although, as a matter of due process, a witness is entitled to an explanation of the pertinency of a question, if he asks for it, it appears he may lose that right if he fails to make a timely objection. See Deutch v. United States, 367 U.S. 456, 468 469, 81 S.Ct. 1587, 1593—1594, 6 L.Ed.2d 963; Barenblatt v. United States, 360 U.S. 109, 123—124, 79 S.Ct. 1081, 1091, 3 L.Ed.2d 1115; Watkins v. United States, 354 U.S. 178, 214—215, 77 S.Ct. 1173, 1193, 1 L.Ed.2d 1273.
For other instances in which a witness' defense has been rejected because he failed to make timely objection, see McPhaul v. United States, 364 U.S. 372, 379, 81 S.Ct. 138, 142, 5 L.Ed.2d 136; United States v. Bryan, 339 U.S. 323, 332—333, 70 S.Ct. 724, 731, 94 L.Ed. 884; Hartman v. United States, 9 Cir., 290 F.2d 460, 467.
1
'Every person who having been summoned as a witness by the authority of either House of Congress to give testimony or to produce papers upon any matter under inquiry before either House, or any joint committee established by a joint or concurrent resolution of the two Houses of Congress, or any committee of either House of Congress, willfully makes default, or who, having appeared, refuses to answer any question pertinent to the question under inquiry, shall be deemed guilty of a misdemeanor, punishable by a fine of not more than $1,000 nor less than $100 and imprisonment in a common jail for not less than one month nor more than twelve months.'
2
'Rule XI
'Powers and Duties of Committees
'(q) (1) Committee on Un-American Activities.
'(A) Un-American activities.
'(2) The Committee on Un-American Activities, as a whole or by subcommittee, is authorized to make from time to time investigations of (i) the extent, character, and objects of un-American propaganda activities in the United States, (ii) the diffusion within the United States of subversive and un-American propaganda that is
instigated from foreign countries or of a domestic origin and attacks the principle of the form of government as guaranteed by our Constitution, and (iii) all other questions in relation thereto that would aid Congress in any necessary remedial legislation.
'The Committee on Un-American Activities shall report to the House (or to the Clerk of the House if the House is not in session) the results of any such investigation, together with such recommendations as it deems advisable.
'For the purpose of any such investigation, the Committee on Un-American Activities, or any subcommittee thereof, is authorized to sit and act at such times and places within the United States, whether or not the House is sitting, has recessed, or has adjourned, to hold such hearings, to require the attendance of such witnesses and the production of such books, papers, and documents, and to take such testimony, as it deems necessary. Subpenas may be issued under the signature of the chairman of the committee or any subcommittee, or by any member designated by any such chairman, and may be served by any person designated by any such chairman or member.'
3
'Rule XII
'Legislative Oversight by Standing Committees
'Sec. 136. To assist the Congress in appraising the administration of the laws and in developing such amendments or related legislation as it may deem necessary, each standing committee of the Senate and the House of Representatives shall exercise continuous watchfulness of the execution by the administrative agencies concerned of any laws, the subject matter of which is within the jurisdiction of such committee; and, for that purpose, shall study all pertinent reports and data submitted to the Congress by the agencies in the executive branch of the Government.'
4
The Committee's resolution enumerated these areas of inquiry:
'1. The extent, character, and objects of Communist infiltration and Communist Party propaganda activities in basic industry in the Gary, Indiana, area, the legislative purpose being to obtain additional information for use by the Committee in its consideration of
Section 16 of H.R. 9352, relating to the proposed amendment of Section 4 of the Communist Control Act of 1954, prescribing a penalty for knowingly and willfully becoming or remaining a member of the Communist Party with knowledge of the purpose or objective thereof, and for the additional legislative purpose of adding to the Committee's overall knowledge on the subject, so that Congress may be kept informed and thus prepared to enact remedial legislation in the national defense and for internal security when and if the exigencies of the situation require it.
'2. Execution by administrative agencies concerned of Public Law 637, of the 83d Congress (68 Stat. 775) known as the 'Communist Control Act of 1954,' relating to the eligibility to exercise the rights and privileges provided under the National Labor Relations Act of labor organizations determined by the Subversive Activities Control Board to be Communist-infiltrated organizations. The legislative purpose is to assist Congress in appraising the administration of the Communist Control Act of 1954 and to enact such amendments thereto as the exigencies of the situation require.
'3. Any other matter within the jurisdiction of the Committee which it or any subcommittee thereof, appointed to conduct this hearing, may designate.'
5
'Under the provisions of Public Law 601, 79th Congress (60 Stat. 812), the Congress has placed upon this committee certain legislative and investigative duties and, in addition, the duty of exercising continuous watchfulness over the execution of any laws, the subject matter of which is within the jurisdiction of this committee. Accordingly, within the framework of this broad jurisdiction and objectives, this subcommittee of the Committee on Un-American Activities is here in Gary for the purpose of receiving testimony concerning Communist techniques and tactics of infiltration and the extent, character and objects of Communist Party propaganda activities in basic industries. The importance of this area of inquiry from the standpoint of national
security, cannot be overemphasized. Without this information, it would be impossible for the committee to carry out its legislative duties as required of it by the Congress.
'In response to the mandate from the Congress to keep constant surveillance over existing security legislation, the committee is constantly surveying the operation of the Internal Security Act of 1950, the Foreign Agents Registration Act, the various espionage statutes, the Communist Control Act of 1954, and similar laws for the purpose of keeping Congress informed of the manner in which laws are being administered and for the purpose of recommending any needed legislative amendments. This mandate will be carried out at this hearing.
'The committee recently formulated an Omnibus Security Bill, H.R. 9352, which represents the most comprehensive effort ever made to deal with all problems in the field of internal security. This bill combines numerous proposals for empowering the Government to combat the various aspects of the Communist conspiracy which are not dealt with adequately in our present laws. It is the hope of the committee that factual information obtained at this hearing will be of assistance in the consideration of the numerous provisions of this bill.
'The committee is especially desirous of obtaining additional information for use in its consideration of Section 16 of H.R. 9352, relating to the proposed amendment of Section 4 of the Communist Control Act of 1954, prescribing a penalty for knowingly and willingly becoming or remaining a member of the Communist Party with knowledge of the purpose or objective thereof.'
6
'It has been testified here that colonization of young men in the middle of their educational courses in industry was a deep-seated plan of the Communist Party to strengthen itself within basic industry. The chairman's opening statement indicated that the activities of the Communist Party within basic industries was the subject of inquiry here.
'The statement was made here of the practice of the Communist Party in colonizing industry at Flint, Michigan; at the University of Colorado, which is at Fort Collins, Colorado (sic), where you now reside; and other places.
'In order to understand the full tactics of the Communist Party in its operations here in Gary, it is necessary the committee understand fully the extent of such practices, the full purposes of it, and the methods by which it is put into effect. That is the connective reasoning of the committee in asking the question.'
7
H.R. 2369, 86th Cong., 1st Sess., sponsored by Congressman Walter, to redefine 'organize' as used in the Smith Act; H.R. 3693, 86th Cong., 1st Sess., introduced by Congressman Scherer, to permit the Federal Government to guard strategic defense facilities against espionage, sabotage and other subversion; H.R. 9352, 85th Cong., 1st Sess., an omnibus bill to amend the Internal Security Act of 1950; H.R. 8121, 86th Cong., 2d Sess., a bill to provide a security program for defense contractors and their employees.
8
'Q. (By Mr. Rabinowitz.) . . . (W)ill you state what information you had, and what additional information you hoped to get?
'A. (By Committee Counsel.) As I was stating, the Committee had sworn testimony by two persons that Yellin was a member of the Communist Party at Michigan University. We had evidence that he had been transferred there from New York City; that he came from Michigan University down here, down to Gary, Indiana, and there became employed in the steel plants.
'We knew, from the statement made, by the information obtained from Mr. LaFleur, that Mr. Yellin had been active in Communist Party activities while employed by steel, the steel companies in Gary, and he so testified later, and it is in the record here.
'Now, with that information relating to Mr. Yellin, we felt certain that Mr. Yellin was in a position, if he would do so, to tell this Committee a great many things regarding the plan of the Communist Party to infiltrate the steel industry here, and to building up the Communist Party from its grass roots level, and just what the Communist Party plans were to make these bright young men leaders who did this thing of colonizing. He could have told us those things, from the position that he was in, if we were correct about his position, had he been willing to do so.
'But not a single witness who has been identified—who has been identified—as a colonizer in any of the places that you have mentioned, that I can recall, has ever admitted it, or ever testified that he had been a colonizer.'
9
Petitioner also raises the following questions:
(1) Did the public interest in securing answers to the questions which were the subject of the indictment outweigh the petitioner's rights under the First Amendment and the public interest in the protection of the free exchange of ideas?
(2) Was the investigation carried on by the Committee in violation of the Constitution and particularly of the First Amendment thereof?
(3) Did the trial court err in excluding certain proffered evidence on the issue of the balancing of public rights and private interests?
(4) Was the statute under which petitioner was convicted unconstitutionally vague?
(5) Were the questions which formed the basis of Counts 2 and 4 too vague to support a valid indictment?
(6) In the circumstances here shown, was there any proper legislative purpose in issuing a subpoena to petitioner?
10
The telegram read: 'Undersigned represents Edward Yellin and Nicholas Busic. On their behalf I request executive session in lieu of open session. Testimony needed for legislative purposes can be secured in executive session without exposing witnesses to publicity. Victor Rabinowitz.'
11
'Mr. TAVENNER. Will you state your name please, sir.
'Mr. YELLIN. Edward Yellin.
'Mr. TAVENNER. Will counsel accompanying the witness please identify himself for the record?
'Mr. RABINOWITZ. Victor Rabinowitz, New York.
'Mr. TAVENNER. Where and when were you born, Mr. Yellin?
'Mr. YELLIN. July 2, 1927, Bronx, New York.
'Mr. TAVENNER. Where do you now reside?
'Mr. YELLIN. Fort Collins, Colorado.
'Mr. SCHERER. I cannot hear the witness.
'The CHAIRMAN. Where?
'Mr. YELLIN. Fort Collins, Colorado.
'Mr. TAVENNER. How long have you lived at Fort Collins, Colorado?
'Mr. YELLIN. Since just about September of '57.
'Mr. TAVENNER. '50?
'Mr. YELLIN. September '57.
'Mr. TAVENNER. Where did you reside prior to—
'Mr. RABINOWITZ. Mr. Counsel, I wonder whether it would be possible to read into the record the exchange of telegrams between myself and the committee in connection with the witness's testimony. I would like to have it appear in the record.
'The CHAIRMAN. We will decide whether it will be made a part of the record when the executive session is held. Go ahead.
'Mr. RABINOWITZ. Mr. Chairman, I sent the telegrams because I wanted them to appear. I do not care whether they appear publicly or not. I do want it to appear that that exchange of telegrams occurred. I did not do it just to increase the revenue of the telegram company.
'The CHAIRMAN. Well, whatever the reason was, whether it has been stated or otherwise, it will be considered in executive session.
'Mr. RABINOWITZ. May I state—
'The CHAIRMAN. Do not bother. You know the privileges given you by this committee. You have appeared before it often enough. You know as well as anybody.
'Go ahead, Mr. Tavenner.'
12
'Mr. TAVENNER. Mr. Yellin, where did you reside prior to September 1957?
'(The witness conferred with his counsel.)
'Mr. YELLIN. Mr. Tavenner, is that right?
'Mr. TAVENNER. Yes.
'Mr. YELLIN. Mr. Tavenner, if I may I would like to say just a few words before I answer that question to state my grounds as to what my position will be on answering questions.
'The CHAIRMAN. Just answer this question, not your grounds for answering questions that have not been asked.
'Mr. YELLIN. Then let me say that I feel that this question and this line of questioning will probably lead into certain areas of my freedom of beliefs, and I feel that I would like to say just a few words as to why I would not care to answer this question.
'The CHAIRMAN. It is not the case of whether you care to answer or not. It is a question of do you or do you not answer the question.
'(The witness conferred with his counsel.)
'Mr. YELLIN. Mr. Congressman, let me put it this way then: I will refuse to answer that question, and I would like the privilege—
'The CHAIRMAN. What is the question, Mr. Tavenner?
'Mr. TAVENNER. The question was where the witness lived prior to September 1957.
'The CHAIRMAN. And you feel honestly that if you answer the question of where you lived before September of last year, you might be confronted with a criminal prosecution, is that it?
'Mr. YELLIN. No. I didn't say that.
'The CHAIRMAN. You did not say that, but is that not what you mean?
'Mr. YELLIN. May I say what my objections are? If I can say what they are—
'The CHAIRMAN. Go ahead.'
13
See also Loubriel v. United States, 2 Cir., 9 F.2d 807, 808:
'The question is no less than whether courts must put up with shifts and subterfuges in the place of truth and are powerless to put an end to trifling. They would prove themselves incapable of dealing with actualities if it were so, for there is no surer sign of a feeble and fumbling law than timidity in penetrating the form to the substance.'
| 23
|
374 U.S. 174
83 S.Ct. 1773
10 L.Ed.2d 823
UNITED STATES, Appellant,v.The SINGER MANUFACTURING COMPANY.
No. 438.
Argued April 25 and 29, 1963.
Decided June 17, 1963.
Daniel M. Friedman, Washington, D.C., for appellant.
Arthur E. Pettit, New York City, for appellee.
Mr. Justice CLARK delivered the opinion of the Court.
1
This is a direct appeal from the judgment of the United States District Court for the Southern District of New York, 205 F.Supp. 394, dismissing a civil antitrust action brought by the United States against the Singer Manufacturing Company to prevent and restrain alleged violations of §§ 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1 and 2. The complaint alleged that Singer combined and conspired with two competitors, Gegauf of Switzerland and Vigorelli of Italy, to restrain and monopolize and that Singer unilaterally attempted to monopolize interstate and foreign trade in the importation, sale and distribution of household zigzag sewing machines. The District Court dismissed after an extended trial, concluding that the charges were without merit. The United States appealed under § 2 of the Expediting Act, 15 U.S.C. § 29, but has abandoned its claim as to attempted monopolization. We noted probable jurisdiction in light of the fact that unless we did so the parties would be deprived of any appellate review in the case. 371 U.S. 918, 83 S.Ct. 289, 9 L.Ed.2d 228. We have examined the record (1,723 pages) in detail, as is necessary in these direct appeals,1 and upon consideration of it, as well as the briefs and argument of counsel, have concluded that there was a conspiracy to exclude Japanese competitors in household zigzag sewing machines and that the judgment must be reversed.
I.
2
The details of the facts are long and complicated. The amended and corrected opinion of the District Court includes not only a description of the sewing machines involved and their operation but also an analysis of the patents covering them. We shall, therefore, not relate the facts in detail but satisfy ourselves with the overriding ones.
3
A. As the District Court stated, this action 'concerns only the United States trade and commerce arising from the importation into the United States of a particular type of household sewing machine known as the 'machine-carried multicam zigzag machine." 205 F.Supp., at 396. The zigzag stitch machine produces various ornamental and functional zigzag stitches as well as straight ones. The automatic multicam zigzag machine, unlike the manually operated zigzag and the replaceable cam machine, each of which requires hand manipulation or insertion, operates in response to the turning of a knob or dial on the exterior of the machine. While the multicam machines involved here function in slightly different ways, all are a variant of the same basic principle.
4
B. Singer is the sole United States manufacturer of household zigzag sewing machines. In addition to the multicam variety at issue here, it produces replaceable cam machines but not the manually operated zigzag. Singer sells these machines in this country through a wholly owned subsidiary and in various foreign countries through independent distributors. Singer's sales comprised approximately 61.4% of all domestic sales in multicam zigzag machines in the United States in 1959. During the same year some 22.6% were imported from Japan and about 16% from Europe. In 1958 Singer's percentage was 69.6%, Japanese imports 20.7% and European imports 9.7%. Further, Singer's 1959 and 1960 domestic sales of multicam machines amounted to approximately $46 million per year, in each of which years such sales accounted for about 45% of all its domestic sewing machine sales.
5
C. It appears that Singer by April 29, 1953, through its experimental department, had completed a design of a multiple cam zigzag mechanism in what it calls the Singer '401' machine. It is disclosed in Singer's Johnson Patent. In 1953 Singer was also developing its Perla Patent as used in its '306' replaceable cam machine and in 1954 its '319' machine-carried multiple cam machine. In September of 1953 Vigorelli, an Italian corporation, introduced in the United States a sewing machine incorporating a stack of cams with a single follower. Singer concluded that Vigorelli had on file applications covering its machine in the various patent offices in the world and that the Singer design would infringe. On June 10, 1955, Singer bought for $8,000 a patent disclosing a plurality of cams with a single cam follower from Carl Harris, a Canadian. It was believed that this patent, filed June 9, 1952, might be reissued with claims covering the Singer 401 as well as its 319 machine, and that the reissued patent would dominate the Vigorelli machine a well as a Japanese one introduced into the United States in September 1954 by Brother International Corporation. Thereafter Singer concluded that litigation would result between it and Vigorelli unless a cross-licensing agreement could be made, and this was effected on November 17, 1955. The license was nonexclusive, world-wide and royalty free. The trial court found that Singer's only purpose was to effect a cross-licensing, but certain correspondence does cast some shadow upon these negotiations.2 The agreement also contained provisions by which each of the parties agreed not to bring any infringement action against the other 'in any country' or institute against the other any opposition, nullity or invalidation proceedings in any country. In accordance with this agreement Singer withdrew its opposition to Vigorelli's patent application in Brazil and Vigorelli later (1958) abandoned a United States interference to the Johnson application which cleared the way for the Johnson Patent to issue on December 2 of that year.
6
D. While Singer was negotiating the cross-license agreement with Vigorelli it learned that Gegauf, a Swiss corporation, had a patent covering a multiple cam mechanism. This placed an additional cloud over Singer's Harris reissue plan because the Gegauf patent enjoyed an effective priority date in Italy of May 31, 1952. This was nine days earlier than Singer's Harris patent filing date in the United States. In December 1955 Singer learned that Gegauf and Vigorelli had entered a cross-licensing agreement covering their multiple cam patents similar to the Vigorelli-Singer agreement. In January 1956 Singer found that Gegauf had pending an application in the United States Patent Office and assumed that it was based on the same priority date, i.e., May 31, 1952. If this was true Singer could use its Harris reissue patent only to oppose through interference the allowance of broad claims to Gegauf. It therefore made preparation to negotiate with Gegauf, first approaching Vigorelli in order to ascertain how the latter had induced Gegauf to grant him a royalty-free license and drop any claim of infringement. Singer made direct arrangements for a conference with Gegauf for April 12, 1956, and the license agreement was made April 14, 1956.
7
The setting for this meeting was that Gegauf had a dominant Swiss patent with applications in Germany, Italy, and the United States all prior to Singer. In addition, Singer's counsel had examined Gegauf's Swiss patent and advised that it was valid. Singer opened conversation with indications of coming litigation on the Harris patent, concealing the Johnson and Perla applications. Gegauf felt secure in his patent claims but insecure with reference to the inroads the Japanese machines were making on the United States market. It was this 'lever' which Singer used to secure the license, pointing out that without an agreement Gegauf and Singer might litigate for a protracted period; that they should not be fighting each other as that would only delay the issue of their respective patents; and, finally, that they should license each other and get their respective patents 'so they could be enforced by whoever would own the particular patent.' Singer in the discussions worked upon these Gegauf fears of Japanese competition 'because one of the strong points' of its argument was that an agreement should be made 'in order to fight against this Japanese competition in their building a machine that in any way reads on the patents of ourselves and of Bernina (Gegauf) which are in conflict.'3 The trial judge found that the only purpose 'disclosed to Gegauf, and in fact the very one used to convince Gegauf of the advisability of entering into an agreement' was to 'obtain protection against the Japanese machines which might be made under the Gegauf patent; this sprang from a fear which Singer had good reason to believe to be well founded.' 205 F.Supp., at 413. While he founds Singer's 'underlying, dominant and sole purpose * * * was to settle the conflict in priority between the Gegauf and Harris patents and to secure for Singer a license right under the earlier patent,' ibid., it is significant that no such overriding purpose was found to have been disclosed to Gegauf.
8
The license agreement covered (1) the Singer-Harris patent and its reissue application in the United States and nine corresponding foreign ones, and (2) the Gegauf Swiss, Italian and German patents, as well as the United States and German applications covering the same. The parties agreed in the first paragraph of the agreement 'not to do anything, either directly or indirectly and in any country, the result of which might restrict the scope of the claims of the other party relating to the subject matter of the above mentioned patents and patent applications.' In addition 'each undertakes, in accordance with the laws and regulations of the Patent Office concerned, to facilitate the allowance in any country of claims as broad as possible, as regards the subject matter of the patents and patent applications referred to above.' The parties also agreed not to sue one another on the basis of any of the patents or applications. Singer agreed not to make a 'slavish' copy of Gegauf's machine and to give Gegauf 'the amical assistance of its patent attorneys for the defense of any of the above mentioned Gegauf patents or patent applications against an action in cancellation.' The agreement made no mention of Singer's Perla or Johnson aplications, the existence of which Singer did not wish Gegauf to know.
9
E. Approximately one week after the Gegauf cross-license agreement Singer met with Vigorelli at Milan, Italy, at the latter's request. Vigorelli at this meeting suggested that Singer, Gegauf and Vigorelli, having arrived at their respective agreements, should act in concert in prosecuting their patents against all others in the field. This was out of the question, Singer immediately replied, advising that 'what appeared to us to be proper action was for each one to prosecute his own patents and take care of any cases of infringement that might appear.'4 The subsequent conversations at the meeting are reported from the same source as follows:
10
'Upon learning that there could be no joint action by the three companies who have been mentioned in prosecuting patents against all others in the field, that subject was dropped * * *.
11
'At this point, it should perhaps be mentioned that Mr. Stanford and I have discussed between ourselves whether we should say anything to Mr. Gegauf about our feeling that we could prosecute his patents that will be issued sometime within the next few months in the United States better than perhaps he could if we owned them, but we had decided not to say anything to Mr. Gegauf about this at this time.
12
'In talking with Mr. Vigorelli's lawyer, Mr. Stanford dropped this view to him. The point was immediately understood, and the question was raised if we would have any objection if they were to pass the word on to Mr. Gegauf that they were raising this point. We said that, of course, we would have no objection but that we ourselves did not wish to do this, and we would not want the suggestion coming to Mr. Gegauf at this time as from us. If they wanted to suggest it, it was all right. We would, of course, under such an arrangement have to give a license to Gegauf under the patent that he would turn over to us. Mr. Stanford believes that he would be able before the patent is issued to rewrite the claims and make it stronger than it now is and that it is a fact that, being in the United States, we would be better able to prosecute any claims against this patent than would Mr. Gegauf.'
13
While the testimony of Mr. Stanford, Singer's patent attorney, varies somewhat from this memorandum of Mr. Waterman, it is substantially the same.5 That the approach to Gegauf was not casually laid is shown by a May 7, 1956, letter from Mr. Stanford to Patent Department employees of Singer in which he said, 'When in Italy we laid careful plans for Gegauf to be advised by a third party that Singer could best handle the patent situation if we owned the Gegauf U.S. Patent. Think it will bear fruit. This suggestion, with the U.S. attorney situation is pressure in the right direction.'
14
Mr. Majnoni reported in June 1956 that he had the 'opportunity of talking to the Patent Attorneys of Mr. F. Gegauf on a number of occasions' concerning 'the question of the advantage of the American Singer Company being in possession of the different patents which might be useful in defence of sewing machines with multiple cams * * *.' He stated that 'the particular character of the question,' i.e., 'the possibility and advantage that the Gegauf patent application in the States be assisgned to Singer,' required that the approach be in 'such a way as to prompt an initiative to this end by Gegauf.' He was hopeful that this had been accomplished. Thereafter on September 19 Dr. S. Lando, Singer representative in Milan, reported that Majnoni advised that Gegauf 'is today effectively willing to transfer his patent application in the U.S. to the Singer, without regard or with little regard to the financial side of the matter.' This was brought about, he said, by discussions between Vigorelli and Gegauf concerning a United States Van Tuyl patent and its effect upon the validity of the Gegauf German patent; that Gegauf had 'made informally known to Mr. Vigorelli that the withdrawing of the Vigorelli application in the U.S. would be greatly appreciated, to prevent the issuance of a printed patent wherein the fact that the Van Tuyl patent exists will be made known to third parties'; that Vigorelli had agreed to withdraw his application and that as a consequence Vigorelli would 'drop any direct means adapted to protect his machines in the U.S., but he is quite sure that Singer will take care of the protection of the machines of the general type of interest, by making use of the owned Harris and Gegauf patents.' In the summer of 1956 Mr. F. Gegauf, Jr., and his sister attended a sewing machine convention at Kansas City. On returning home they met with Singer (Messrs. Waterman & Stanford) in Singer's office in New York City. Gegauf expressed concern over the number of Japanese machines that he had seen at the convention. Singer again found opportunity to employ the Japanese problem and stressed to Gegauf, Jr., the difficulties of enforcing a patent in the United States—namely, large number of importers, size of the country, number of judicial circuits, etc. Singer emphasized that these all presented problems to the owner of a United States patent. Singer being in the United States could, they said, enforce the patent better than Gegauf could. They asked Gegauf, Jr., whether he thought his father would be interested in selling the patent to Singer. Thereafter, on September 3, Gegauf, Jr. wrote Mr. Waterman that Singer's suggestion had been taken up with Gegauf, Sr., and 'we might be interested in such an agreement.' The closing paragraph says: 'We agree that something should be done against Japanese competition in your country and maybe South America and are therefore looking forward to your early reply.' Waterman replied on September 7 that he and Mr. Stanford would be in Germany on September 18 through 25; he asked that Gegauf's United States patent attorney be directed to meet with Stanford in New York City with authorization to disclose the content of the Gegauf patent application so that time might he saved in Europe. Mr. Waterman closed with the belief 'that it may be possible that we can both strengthen our positions with respect to the Japanese competition which you mention * * *.' The conference was set for September 23 at which time Gegauf demanded $250,000 for the patent and negotiations broke off. Singer wrote Dr. Lando, its Milan agent, on October 9, informing him. The letter closed with this paragraph: 'I thought you would like to have this information if the subject should come up in talking with Mr. Vigorelli or his attorney.' And on October 24 Singer wrote Mr. Gegauf advising that the United States Patent Office had declared an interference between their patent applications; that their cross-license agreement provided that this interference be settled in accordance with the patent laws of the United States; that 'since * * * interference proceedings are usually time consuming and costly to the parties involved, it would appear that it would be advantageous for us to settle the interference between ourselves rather than to continue the proceeding and rely on the United States Patent Office finally to award a priority'; and finally Singer suggested that the attorneys for the parties in the United States get together with a view to settling the interference. Singer abandoned its interference on March 15, 1957, and the Gegauf claim was taken verbatim from the Singer Harris reissue claim.
15
Nothing more was done by Singer toward securing the Gegauf application until September 12, 1957, when Singer wrote Gegauf that its Harris application was about to be issued as a patent. It also anticipated that several other patents relating to ornamental stitch machines would soon be issued to it and presumed Gegauf's application would soon be granted. Then followed this paragraph:
16
'When I had the pleasure of meeting you last fall we had some discussion relative to the procedures that might be followed to enforce the patents * * *, when issued, against infringing manufacturers who primarily are manufacturers in other countries seeking markets in the United States, and more and more throughout the entire world. These manufacturers are bringing out a large variety of ornamental stitch machines which would appear to come within the terms of claims which may be awarded in the United States with respect of the aforementioned Singer and Gegauf patents. A proper enforcement of these patents may make it necessary to instigate patent suits against each of the importers in the United States, of whom there will perhaps be many. I think you will agree with me that neither one of us alone can protect himself most effectively.'6 This letter brought on a meeting of the parties in Zurich on October 16, 1957. Gegauf's position was that, as the trial court found, 'while it had no objection 'to making an agreement with Singer, in order to stop as far as possible Japanese competitors in the United States market,' it was willing to do so only under certain conditions.' 205 F.Supp., at 416. Finally, as the trial court found, Gegauf demanded $125,000 plus certain conditions declaring that it 'was cheap and that it could not go lower since it could get more money if it licensed the invention. Kirker (of Singer) replied that there was no comparison since a sale to Singer was insurance against common competitors and that was why Singer was willing to pay.' Ibid. In another exchange Gegauf
17
'advanced the argument that, if stopped by Singer in the United States, the Japanese manufacturers would run to Europe; to this Singer answered that a greater risk was run in Europe if Singer were not permitted to first stop infringements in the United States. * * * Singer continued 'to drive home the point' that Gegauf stood to benefit more by enforcement of the patents in the United States because the 'Brother Pacesetter' machine, a big selling and patent infringing Japanese-made machine, was in direct competition with the Gegauf machine, for both machines were of the free arm type.' 205 F.Supp., at 417.
18
Finally Gegauf assigned to Singer its application and all rights in the invention claimed and to all United States patents which might be granted under it for $90,000. The accompanying agreement provided that (1) Singer would grant Gegauf a nonexclusive royalty-free license to sell in the United States sewing machines made in Gegauf's factory in Switzerland; (2) Singer would not institute, without the consent of Gegauf, legal proceedings asserting the patents when issued against Pfaff in Germany or Vigorelli in Italy with respect to machines manufactured in their home factories; and (3) Singer would not make a 'slavish' copy of Gegauf's Bernina machine.
19
F. The Gegauf patent issued on April 29, 1958, and Singer filed two infringement suits against Brother, the largest domestic importer of Japanese machines. It also sued two other distributors of multicam machines, those actions terminating in consent decrees. Finally, in January 1959, eight months after the patent was issued, Singer brought a proceeding before the United States Tariff Commission under § 337 of the Tariff Act of 1930, 19 U.S.C. s 1337. It sought an order of the President of the United States excluding all imported machines coming within the claims of the Gegauf patent for the term of the patent, naming European as well as Japanese infringers. Singer alleged that the tremendous volume of imports from Japan of household sewing machines, other than automatic zigzag, had eliminated all domestic manufacturers save itself and one small straight stitch part-time concern. It further alleged that the increasing volume of infringing imports similarly threatened to result in the curtailment and ultimate cessation of manufacturing operations in the United States in automatic zigzags, with heavy loss of highly paid and skilled labor and large capital investment. At the time of the filing, Singer alleged, foreign-made machines, 'primarily from Japan,' were being imported to the extent of 50% of the entire Singer sales of automatic zigzag machines in this country; it represented that the automatic zigzag machine is its most important product and that it sells for a minimum price of $300; that infringers from Japan sell at no firm price, the average being $100 less than Singer's price but often far below that figure; and that the minimum price in Japan for export is $40 to $54.
20
During the hearing on its complaint Singer was asked whether Pfaff was licensed under the Gegauf patent. Singer replied in the negative but became skeptical and, believing that it might 'have a better chance of prevailing before the Tariff Commission,' decided to ask Gegauf to revise the agreement, which originally excepted Pfaff and Vigorelli from enforcement proceedings, except on consent of Gegauf. The latter agreed on condition that Phoenix, a German manufacturer which was a party-defendant in the proceedings, be substituted.
21
Upon commencement of this action by the United States, the Commission stayed the proceedings, and they are now in abeyance pending our disposition of this case.
II.
22
First it may be helpful to set out what is not involved in this case. There is no claim by the Government that it is illegal for one merely to acquire a patent in order to exclude his competitors; or that the owner of a lawfully acquired patent cannot use the patent laws to exclude all infringers of the patent; or that a licensee cannot lawfully acquire the covering patent in order better to enforce it on his own acccount, even when the patent dominates an industry in which the licensee is the dominant firm. Therefore, we put all these matters aside without discussion.
23
What is claimed here is that Singer engaged in a series of transactions with Gegauf and Vigorelli for an illegal purpose, i.e., to rid itself and Gegauf, together, perhaps, with Vigorelli, of infringements by their common competitors, the Japanese manufacturers. The Government claims that in this respect there were an identity of purpose among the parties and actions pursuant thereto that in law amount to a combination or conspiracy violative of the Sherman Act. It claims that this can be established under the findings of the District Court.
24
We note from the findings that the importation of Japanese household multicam zigzag sewing machines first came to notice in the United States in 1954 with the introduction of such a machine by the Brother International Corporation. It incorporated the mechanism of the Vigorelli zigzag and the Singer 401 machines. By 1959 importations of all Japanese household sewing machines reached 1,100,000, while importations of European machines reached only 100,000. Moreover, it appears that all but two domestic manufacturers were put out of business in three to four years after the Japanese machines first appeared. The two remaining domentic manufacturers were Singer and a company not specializing in sewing machines, which manufactured only straight stitch machines on order for a single domestic customer.
25
The trial court found that no mention was made of the Japanese machines during the negotiations covering the Vigorelli cross-licensing agreement with Singer. It first appeared during the Gegauf licensing negotiations where at those meetings Singer used 'protection against the Japanese' as 'one of the strong points' on the cross-licensing of the Gegauf and Harris patents and applications. Here, though the trial court stated that the 'dominant and sole purpose of the license agreement was to settle the conflict in priority,' it specifically, in the next paragraph of its opinion, found a 'secondary' purpose, i.e., protection against the Japanese machines which were infringing the Gegauf patent. In this connection it is most important to note another finding of the trial court, namely, that this purpose to exclude the Japanese 'was the only one disclosed to Gegauf, and in fact the very one used to convince Gegauf of the advisability of entering into an agreement.' 205 F.Supp., at 413. Under these findings it cannot be said that settlement of the conflict in priority was the 'dominant and sole purpose' of Singer. Indeed, the two findings are in direct conflict. Furthermore the fact that the cross-license agreement provided that Singer and Gegauf would facilitate the allowance to each other of claims 'as broad as possible' indicates a desire to secure as broad coverage for the patent as possible, the more effectively to stifle competition, the overwhelming percentage of which was Japanese. This effect was accomplished, for when the Patent Office placed the Harris (Singer) and Gegauf patents in interference, Singer abandoned the proceeding, thus facilitating the issuance of broad claims to Gegauf.7
26
We now come to the assignment of the Gegauf patent to Singer. The trial court found: (1) that six days after the license agreement was made with Gegauf, Singer proceeded to Italy where a conference was held with Vigorelli. At this meeting two events took place that led to the later acquisition of the patent by Singer. The first was Vigorelli's proposal that Singer, Gegauf and himself act 'in concert against others' in enforcing the patent. This was rejected by Singer's representatives, who said it was best for each 'to prosecute his own patents.' At the same meeting, however, Singer proposed to Vigorelli that it could prosecute the Gegauf patent in the United States better than Gegauf and, after Vigorelli agreed, solicited his help in getting Gegauf to agree to assign the patent. (2) Vigorelli went to Gegauf 'acting as Singer's agent,' 205 F.Supp., at 414, and convinced the latter sufficiently for him to write Singer that he favored the idea of doing something 'against Japanese competition.' (3) Singer replied to Gegauf by letter that an arrangement could be reached 'equally advantageous to both.' (4) Singer went to Europe but was not able to agree on Gegauf's terms and thereafter, in September 1957, wrote the latter that 'their mutual interests required that something be done to protect themselves from the Japanese infringing machines.' (5) Gegauf replied that he would be happy to meet Singer to discuss 'mutual enforcement' of its United States application and the Harris reissue. Then, (6) in the final conferences in Europe Gegauf told Singer that he had no objection 'to making an agreement with Singer, in order to stop as far as possible Japanese competitors in the United States market.' Further, the trial court found that Singer assured Gegauf that 'Singer was insurance against common competitors' and Gegauf's fears that if Singer stopped the Japanese infringements in the United States they (the Japanese) would go to Europe, where Gegauf was not in as good a position to stop them, were unfounded because a greater risk was run in Europe if Singer were not permitted to first stop infringements in the United States. Finally, the court found that (7) Singer was determined 'to drive home the point' that Gegauf stood to benefit more by enforcement of the patents in the United States because the 'Brother Pacesetter' machine, a big selling and patent infringing Japanese-made machine, was in direct competition with the Gegauf machine in the United States. As the trial court put it, '(t)he point apparently reached home'—Gegauf ultimately assigned the patent for only $90,000, much less than its original asking price and much less than Gegauf believed it would realize annually from a license grant. Gegauf's beliefs as to the inadequacy of the monetary consideration were well founded, since Singer received more than twice that amount in a two-year period from the one license it granted under the Gegauf patent. That license, incidentally, was to Sears, Roebuck & Company, which imported machines from Europe.
III.
27
As we have noted with reference to the cross-license agreement, the trial court decided that '(t)he undisputed facts support no conclusion other than that the underlying, dominant and sole purpose of the license agreement was to settle the conflict in priority between the Gegauf and Harris patents * * *.' We have rejected this conclusion on the trial court's own finding in the next paragraph of the opinion that Singer's 'secondary' purpose, the only one disclosed to Gegauf, was its 'desire to obtain protection against the Japanese machines which might be made under the Gegauf patent.' Likewise we reject, as a question of law, the court's inference that the attitude of suspicion, wariness and self-preservation of the parties negated a conspiracy. See United States v. Line Material Co., 333 U.S. 287, 297, 68 S.Ct. 550, 555, 92 L.Ed. 701 (1948); United States v. Masonite Corp., 316 U.S. 265, 280—281, 62 S.Ct. 1070, 1078—1079, 86 L.Ed. 1461 (1942); United States v. General Electric Co., 80 F.Supp. 989, 997—998 (S.D.N.Y.1948).
28
The trial court held that the fact that Singer had a purpose, which 'Gegauf well knew,' of enforcing the patent upon its acquisition, that the enforcement 'would most certainly include Japanese manufacturers who were the principal infringers,' and 'that Gegauf shared with Singer a common concern over Japanese competition' did not establish a conspiracy. 205 F.Supp., at 419. Given the court's own findings and the clear import of the record, it is apparent that its conclusions were predicated upon 'an erroneous interpretation of the standard to be applied. * * *' Thus, '(b)ecause of the nature of the District Court's error we are reviewing a question of law, namely, whether the District Court applied the proper standard to essentially undisputed facts.' United States v. Parke, Davis & Co., 362 U.S. 29, 44, 80 S.Ct. 503, 512, 4 L.Ed.2d 505 (1960). There in a discussion of a like problem we held that 'the inference of an agreement in violation of the Sherman Act' is not 'merely limited to particular fact complexes,' ibid., citing United States v. Bausch & Lomb Optical Co., 321 U.S. 707, 64 S.Ct. 805, 88 L.Ed. 1024 (1944), and Federal Trade Comm. v. Beech-Nut Packing Co., 257 U.S. 441, 42 S.Ct. 150, 66 L.Ed. 307 (1922). 'Both cases,' the Court continued, 'teach that judicial inquiry is not to stop with a search of the record for evidence of purely contractual arrangements. * * *' Ibid. Whether the conspiracy was achieved by agreement, by tacit understanding, or by 'acquiescence * * * coupled with assistance in effectuating its purpose is immaterial.' United States v. Bausch & Lomb, supra, 321 U.S. at 723, 64 S.Ct. at 813. Here the patent was put in Singer's hands to achieve the common purpose of enforcement 'equally advantageous to both' Singer and Gegauf and to Vigorelli as well.8 What Singer had refused Vigorelli, i.e., acting 'in concert against others,' was thus achieved by the simple expedient of transferring the patent to Singer.
29
Thus by entwining itself with Gegauf and Vigorelli in such a program Singer went far beyond its claimed purpose of merely protecting its own 401 machine—it was protecting Gegauf and Vigorelli, the sole licensees under the patent at the time, under the same umbrella. This the Sherman Act will not permit. As the Court held in Frey & Son, Inc. v. Cudahy Packing Co., 256 U.S. 208, 210, 41 S.Ct. 451, 452, 65 L.Ed. 892 (1921), the conspiracy arises implicitly from the course of dealing of the parties, here resulting in Singer's obligation to enforce the patent to the benefit of all three parties. While there was no contract so stipulating, the facts as found by the trial court indicate a common purpose9 to suppress the Japanese machine competition in the United States through the use of the patent, which was secured by Singer on the assurances to Gegauf and its colicensee, Vigorelli, that such would certainly be the result. See Federal Trade Comm. v. Beech-Nut Packing Co., supra. Singer cannot, of course, contend that it sought the assignment of the patent merely to assure that it could produce and sell its machines, since the preceding cross-license agreement had assured that right. The fact that the enforcement plan likewise served Singer is of no consequence, the controlling factor being the overall common design, i.e., to destroy the Japanese sale of infringing machines in the United States by placing the patent in Singer's hands the better to achieve this result. It is this concerted action to restrain trade, clearly established by the course of dealings, that condemns the transactions under the Sherman Act. As we said in United States v. Parke, Davis & Co., supra, 362 U.S. at 44, 80 S.Ct. at 512, 'whether an unlawful combination or conspiracy is proved is to be judged by what the parties actually did rather than by the words they used.'
30
Moreover this overriding common design to exclude the Japanese machines in the United States is clearly illustrated by Singer's action before the United States Tariff Commission. Less than eight months after the patent was issued it started this effort to bar infringers in one sweep. As an American corporation, it was the sole company of the three that was able to bring such an action. When it appeared that the references to Pfaff in the assignment agreement threatened the success of the Tariff Commission proceeding, Gegauf consented to the deletion of Pfaff from the agreement. This maneuver was for the purpose, as the trial court found, of giving Singer "a better chance of prevailing before the Tariff Commission' in its efforts to exclude' infringing machines. 205 F.Supp., at 427. While the tariff application was leveled against nine European as well as the Japanese competitors, the allegations were clearly beamed at the infringing Japanese machines to which Singer attributed the destruction of all American domestic household sewing machine companies save itself. As the parties to the agreements and assignment well knew, and as the trial court itself stated, '(b)y far the largest number of infringers of the Gegauf patent and invention were the Japanese.' 205 F.Supp., at 418.
31
It is strongly urged upon us that application of the antitrust laws in this case will have a significantly deleterious effect on Singer's position as the sole remaining domestic producer of zigzag sewing machines for household use, the market for which has been increasingly preempted by foreign manufacturers. Whether economic consequences of this character warrant relaxation of the scope of enforcement of the antitrust laws, however, is a policy matter committed to congressional or executive resolution. It is not within the province of the courts, whose function is to apply the existing law. It is well settled that '(b)eyond the limited monopoly which is granted, the arrangements by which the patent is utilized are subject to the general law,' United States v. Masonite Corp., supra, 316 U.S. at 277, 62 S.Ct. at 1077 and it 'is equally well settled that the possession of a valid patent or patents does not give the patentee any exemption from the provisions of the Sherman Act beyond the limits of the patent monopoly. By aggregating patents in one control, the holder of the patents cannot escape the prohibitions of the Sherman Act.' United States v. Line Material Co., supra, 333 U.S. at 308, 68 S.Ct. at 561. That Act imposes strict limitations on the concerted activities in which patent owners may lawfully engage, see United States v. United States Gypsum Co., 333 U.S. 364, 68 S.Ct. 525, 92 L.Ed. 746 (1948); United States v. Line Material Co., supra; United States v. National Lead Co., D.C., 63 F.Supp. 513, aff'd, 332 U.S. 319, 67 S.Ct. 1634, 91 L.Ed. 2077 (1947), and those limitations have been exceeded in this case.
32
The judgment of the District Court is reversed and the case is remanded for the entry of an appropriate decree in accordance with this opinion. It is so ordered.
33
Reversed and remanded.
34
Mr. Justice WHITE, concurring.
35
There are two phases to the Government's case here: one, the conspiracy to exclude the Japanese from the market, and the other, the collusive termination of a Patent Office interference proceeding pursuant to an agreement between Singer and Gegauf to help one another to secure as broad a patent monopoly as possible, invalidity considerations notwithstanding. The Court finds a violation of § 1 of the Sherman Act in the totality of Singer's conduct, and intimates no views as to either phase of the Government's case standing alone. Since, in my view, either branch of the case is sufficient to warrant relief, I join the Court's opinion, except for footnote, 1, with which I disagree.
36
As to the conspiracy to exclude the Japanese, there is involved, as the Court points out, more than the transfer of the patent from one competitor to another; implicit in the arrangement is Singer's undertaking to enforce the patent on behalf of both itself and Gegauf. Moreover, Singer was the dominant manufacturer in the American sewing machine industry and was acquiring a patent which dominated the multicam field, an aspect of this case which in itself raises serious questions, in my view, and which is saved by the Court for future consideration. See p. 189, supra.
37
More must be said about the interference settlement. In 1956, Singer's 'Harris' multicam zigzag reissue-patent application was pending in the United States Patent Office; Gegauf had an application pending at the same time covering substantially the same subject matter, but enjoying a nine-day earlier priority date. See 35 U.S.C. § 119. In the circumstances, it appeared to Singer that, between Singer and Gegauf, Gegauf would have a better claim to a patent on the multicam zigzag, at least on the broad and thus more valuable claims. But it was by no means certain that either of them would get the patent. In cases where several applicants claim the same subject matter, the Patent Office declares an 'interference.' This is an adversary proceeding between the rival applicants, primarily for the purpose of determining relative priority. But a party to an interference also can, by drawing additional prior art to the attention of the Patent Office which will require the Office to issue no patent at all to anyone, see 37 CFR §§ 1.232, 1.237(a); cf. 35 U.S.C. §§ 101 102, prevent his rival from securing a patent which if granted might exclude him from the manufacture of the subject matter. 35 U.S.C. § 154. Gegauf, after Singer approached it to negotiate an agreement before the Office declared an interference, feared that Singer might in self-defense draw to the attention of the Patent Office certain earlier patents the Office was unaware of, and which might cause the Gegauf claims to be limited or invalidated; Singer 'let them know that we thought we could knock out their claims but that in so doing we were probably going to hurt both of us.'
38
The result was that in April 1956 Singer and Gegauf entered a general cross-licensing agreement providing that the parties were not to attack one another's patent applications 'directly or indirectly,' not to do anything to restrict one another's claims in patents or applications, and to facilitate the allowance to one another of 'claims as broad as possible.' In August 1956 the Patent Office declared the anticipated interference. Singer and Gegauf settled the interference pursuant to their prior agreement: Singer withdrew its interfering claims and in April 1957 the Patent Office dissolved the interference proceeding before it had ever reached the litigation stage. 37 CFR § 1.262. Eventually the Gegauf patent issued and was sold to Singer as part of the concerted action to exclude the Japanese which is involved in the first branch of the case, supra, p. 197.
39
In itself the desire to secure broad claims in a patent may well be unexceptionable—when purely unilateral action is involved. And the settlement of an interference in which the only interests at stake are those of the adversaries, as in the case of a dispute over relative priority only and where possible invalidity, because of known prior art, is not involved, may well be consistent with the general policy favoring settlement of litigation. But the present case involves a less innocuous setting. Singer and Gegauf agreed to settle an interference, at least in part, to prevent an open fight over validity. There is a public interest here, see Mercoid Corp. v. Mid-Continent Inv. Co., 320 U.S. 661, 665, 64 S.Ct. 268, 271, 88 L.Ed. 376; United States v. Masonite Corp., 316 U.S. 265, 278, 62 S.Ct. 1070, 1077, 86 L.Ed. 1461, which the parties have subordinated to their private ends—the public interest in granting patent monopolies only when the progress of the useful arts and of science will be furthered because as the consideration for its grant the public is given a novel and useful invention. U.S.Const., Art. I, § 8; 35 U.S.C. § 101; Statute of Monopolies, 21 Jac. I, c. 3. When there is no novelty and the public parts with the monopoly grant for no return, the public has been imposed upon and the patent clause subverted. United States v. American Bell Telephone Co., 128 U.S. 315, 357, 370, 9 S.Ct. 90, 93, 98, 32 L.Ed. 450; see Katzinger Co. v. Chicago Metallic Mfg. Co., 329 U.S. 394, 400—401, 67 S.Ct. 416, 419—421, 91 L.Ed. 374; Cuno Engineering Corp. v. Automatic Devices Corp., 314 U.S. 84, 92, 62 S.Ct. 37, 41, 86 L.Ed. 58; Great Atlantic & Pacific Tea Co. v. Supermarket Equipment Corp., 340 U.S. 147, 154—155, 71 S.Ct. 127, 131—132, 95 L.Ed. 162 (concurring opinion). Whatever may be the duty of a single party to draw the prior art to the Office's attention, see 35 U.S.C. § 115; 37 CFR § 1.65(a); Bell Telephone, supra, 128 U.S. at 356, 9 S.Ct. at 92, clearly collusion among applicants to prevent prior art from coming to or being drawn to the Office's attention is an inequitable imposition on the Office and on the public. Precision Instrument Mfg. Co. v. Automotive Maintenance Machinery Co., 324 U.S. 806, 65 S.Ct. 993, 89 L.Ed. 1381; see H.R.Rep.No.1983, 87th Cong., 2d Sess. 1, 4 (Rep. on Act of October 15, 1962 Pub.L. 87—831, 76 Stat. 958; U.S.Code Cong. & Adm.News, 1961, p. 3286). In my view, such collusion to secure a monopoly grant runs afoul of the Sherman Act's prohibitions against conspiracies in restraint of trade*—if not bad per se, then such agreements are at least presumptively bad. Compare Mitchel v. Reynolds, 1 P.Wms. 181, 191—192, 24 Eng.Rep. 347, 350 351. The patent laws do not authorize, and the Sherman Act does not permit, such agreements between business rivals to encroach upon the public domain and usurp it to themselves.
40
Mr. Justice HARLAN, dissenting.
41
Although the Court reverses this case on the ground that the District Court proceeded on erroneous legal premises, I do not believe its opinion can serve to obscure the fact that what the majority has really done is overturn the lower court's findings of fact.
42
A mere reading of the exhaustive opinion below will show that the District Court in dismissing the Government's case did not, as this Court now holds, fail to recognize that a concerted use by Singer and Gegauf of their patents in pursuit of a common purpose to thwart Japanese competition would violate the Sherman Act. Rather the District Court found that such a violation had not been made out.
43
The basic predicate for this Court's attributing to the District Court the following of an erroneous legal standard is the 'direct conflict' which the majority sees between the lower court's finding that Singer's underlying, 'dominant and sole purpose' in entering into the Gegauf license agreement 'was to settle the conflict' between the Harris and the Gegauf patents and the finding that Singer's 'secondary' purpose was its desire to obtain 'protection against the Japanese machines' which might be made under the Gegauf patent (ante, p. 190). This is indeed a slender reed for the Court's position. For one is left at a loss to understand how the two findings can be deemed inconsistent. Obviously Singer wanted to settle the 'priority' issue with Gegauf in order to have solid patent protection against all comers particularly of course the Japanese, whose ability to manufacture these popular machines in a cheap labor market put them in the forefront of possible infringers. Thus it seems to me that the findings as to Singer's 'dominant' and 'secondary' purposes are entirely consistent, and that their supposed inconsistency can be made to rest on nothing more substantial than a play on the word 'sole' in the basic finding. The further circumstance that it was only Singer's 'secondary' purpose that was disclosed to Gegauf goes not to the question of 'consistency' but rather to the sufficiency of the lower court's ultimate finding that no illegal concert of action had been shown between Singer and Gegauf.
44
Nor does anything to which the Court points in the Gegauf patent assignment and Tariff Commission episodes (ante, pp. 191 196) lend support to this transparent effort to ground reversal on a question of law so as to escape the necessity of coming to grips with the only true issue in this case: are the District Court's findings of fact—which if accepted would put an end to the Government's case—'clearly erroneous'? Again the various bits and pieces which the Court has called from this lengthy record go not to the consistency but to the sufficiency of the findings.
45
In my opinion the District Court's findings are invulnerable to attack under Rule 52(a) of the Federal Rules of Civil Procedure. The mere fact that one or more of the members of this Court might have made opposite findings if sitting at nisi prius does not of course serve to justify reversal of a District Court's findings under the 'clearly erroneous' rule. United States v. Yellow Cab Co., 338 U.S. 338, 341—342, 70 S.Ct. 177, 179—180, 94 L.Ed. 150.
46
In conclusion, it is gratifying to observe the Court's recognition of the fact that the requirement of direct review in cases like this has become an anachronism in light of the modern work load of this Court. Ante, note 1; see also the separate opinion of this writer in Brown Shoe Co. v. United States, 370 U.S. 294, 357, 364—365, 82 S.Ct. 1502, 1542, 1546, 1547, 8 L.Ed.2d 510. The final outcome of this case might indeed have been different had this Court had 'the valuable assistance of the Courts of Appeals' (ante, note 1).
47
I would affirm the judgment of the District Court.
1
Whatever may have been the wisdom of the Expediting Act in providing direct appeals in antitrust cases at the time of its enactment in 1903, time has proven it unsatisfactory. See, e.g., Gesell, A Much Needed Reform—Repeal the Expediting Act for Antitrust Cases, in 1961 N.Y. State Bar Ann. Antitrust L.Sym. 98 (CCH). Direct appeals not only place a great burden on the Court but also deprive us of the valuable assistance of the Courts of Appeals.
2
'Unless we are able to come to some agreement with Vigorelli, we will of course institute proceedings in Italy in due time, seeking to invalidate such patent as Vigorelli has received and we will do the same thing in France and other countries in accordance with the proper procedure in each country. This litigation will undoubtedly result either in the cancelling of their patent and patent applications, or at any rate, severely limit the claims. On the other hand, if we were to refrain from instituting such proceedings and if we were to withdraw the Brazilian opposition, their applications might develop into rather broad patents which would have a dominating position in the industry. We ourselves hold some patents and have patent applications pending which would make trouble for Vigorelli if we were engaged in litigation with them, or which would greatly strengthen and broaden the patent situation if our position and theirs could be pooled by some mutual agreement.' Letter from M. C. Lightner, Singer President, to W. P. Evans of Singer's Italian Corporation, September 12, 1955.
3
Memorandum from M. L. Waterman, Singer Vice President, to M. C. Lightner, April 13, 1956.
4
M. L. Waterman, notes dictated at Milan, April 20, 1956.
5
Mr. Stanford testified that a Mr. Majnoni, patent attorney present for Vigorelli, came over to him as the discussions (which were in Italian and English as some participants spoke only their native tongue) were more or less over and said that he would like to speak in English. He asked 'about the situation here in the United States between Gegauf and the Harris patent * * *.' Stanford replied 'that they would probably be locked in interference very shortly; that Gegauf was ahead of us and that I was very much afraid that Gegauf was going to win the interference, that I was sorry because I felt that if we had the claims and were able to keep them in the Harris patent, we would be able to enforce them better than could (Gegauf) if he had a patent * * *.' Stanford told Majnoni that Singer had made no approaches to Gegauf because the price would 'go sky high'; Majnoni said that he knew Mr. Gegauf's attorney, had 'frequent contacts with him' and offered to approach him. Stanford said he 'didn't think that would do any good; that I thought that would be just as bad.' Majnoni replied that he would let him think it came directly from him. 'I think,' he added, 'it would be advantageous * * f Singer owned the claims * * *.' Stanford interpreted this to mean that Majnoni thought it would be better for Vigorelli 'if Singer, who was a corporation in the United States, owned the Gegauf patent and they would rather have Singer own it than have Gegauf because they thought that we could enforce it better or were in a better position to enforce it.'
6
This letter is substantially the same as the proposed letter which Mr. Stanford sent Mr. Waterman for transmittal to Gegauf, except that the quoted paragraph was phrased more directly in the proposed letter:
'You are no doubt aware that recently the many Japanese sewing machine manufacturers have brought out a large variety of ornamental stitch machines which would appear to come within the terms of claims which may be awarded in the United States with respect of the above Gegauf and Singer patents. We have reason to believe that all of the very many United States sewing machine importers will wish to deal in such Japanese ornamental stitch machines, and that patent suits against each of these importers may be necessary if our respective patents are to be enforced.
'Your (sic) may agree with us that under the terms of our present agreement neither party is in a position effectively to protect itself through patents in the United States with respect to this threatened competition, particularly when the competing machines are copies after both Bernina and Singer models.'
7
Since we have concluded that the entire course of dealings between the parties, including the cross-license agreement, establishes a conspiracy or combination in violation of the Sherman Act, we need not and do not pass on the Government's contention that the cross-license agreement and the interfrence settlement are illegal apart from the other circumstances present here. As to this question, see Note, 31 Geo.Wash.L.Rev. 643 (1963).
8
In addition, though the parties do not discuss the effect of the final arrangement, it would permit both Gegauf and Vigorelli to sell machines under the patent in the United States. The fact that this might be consequential is indicated by the statistic that in 1959 Europe furnished 16% of the machines sold in the United States.
9
The trial court's findings, as we have noted, are inconsistent in some respects. The court repeatedly described the role of the parties' 'mutual interests' in the achievement of an agreement to assign the Gegauf patent to Singer. It also found that 'Gegauf shared with Singer a common concern over Japanese competition,' 205 F.Supp., at 419, and that both parties knew that Singer wanted the patent in order to enforce it against their common competitors, the Japanese. Still, at one point, the court states that 'their dealings were characterized by an absence of unity or identity of any common purpose or motive.' 205 F.Supp., at 418. Insofar as that conclusion derived from the court's application of an improper standard to the facts, it may be corrected as a matter of law. Insofar as the conclusion is based on 'inferences drawn from documents or undisputed facts, * * * Rule 52(a) of the Rules of Civil Procedure is applicable.' United States v. United States Gypsum Co., 333 U.S. 364, 394, 68 S.Ct. 525, 541, 92 L.Ed. 746 (1948). The rule was there stated that '(a) finding is 'clearly erroneous' when although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.' Id., at 395, 68 S.Ct. at 542. The evidence here, including many findings of the trial court, clearly compels the conclusion that the parties' concerted activities were motivated by a common purpose, and the court's conclusion to the contrary must be regarded as clearly erroneous. United States v. United States Gypsum Co., supra; see Pacific Portland Cement Co. v. Food Mach. & Chem. Corp., 178 F.2d 541 (C.A.9th Cir. 1949).
*
The Court has already held similar agreements contrary to public policy and unenforceable. In the 'patent estoppel' cases the Court found that public policy favors the exposure of invalid patent monopolies before the courts in order to free the public from their effects. Thus a licensee may not be prevented from attacking the validity of his licensor's patent. Sola Elec. Co. v. Jefferson Elec. Co., 317 U.S. 173, 63 S.Ct. 172, 87 L.Ed. 165; Scott Paper Co. v. Marcalus Mfg. Co., 326 U.S. 249, 66 S.Ct. 101, 90 L.Ed. 47; Katzinger Co. v. Chicago Metallic Mfg. Co., 329 U.S. 394, 67 S.Ct. 416, 91 L.Ed. 374; MacGregor v. Westinghouse Elec. & Mfg. Co., 329 U.S. 402, 67 S.Ct. 421, 91 L.Ed. 380; United States v. United States Gypsum Co., 333 U.S. 364, 387—388, 68 S.Ct. 525, 538—539, 92 L.Ed. 746.
It should be noted that the present agreement involved a specific promise not to attack one another's patents directly or indirectly in addition to a promise to cooperate in interference proceedings.
| 78
|
374 U.S. 203
83 S.Ct. 1560
10 L.Ed.2d 844
SCHOOL DISTRICT OF ABINGTON TOWNSHIP, PENNSYLVANIA, et al., Appellants,v.Edward Lewis SCHEMPP et al. William J. MURRAY III, etc., et al., Petitioners, v. John N. CURLETT, President, et al., Individually, and Constituting the Board of School Commissioners of Baltimore City.
Nos. 142 and 119.
Argued Feb. 27 and 28, 1963.
Decided June 17, 1963.
No. 142.
[Syllabus from 203 intentionally omitted]
Philip H. Ward III, Philadelphia, Pa., and John D. Killian, III, Harrisburg, Pa., for appellants.
Henry W. Sawyer III, Philadelphia, Pa., for appellees.
No. 119.
Leonard J. Kerpelman, Baltimore, Md., for petitioners.
Francis B. Burch and George W. Baker, Jr., Baltimore, Md., for respondents.
Thomas B. Finan, Baltimore, Md., for State of Maryland, as amicus curiae.
[Amicus Curiae intentionally omitted]
Mr. Justice CLARK delivered the opinion of the Court.
1
Once again we are called upon to consider the scope of the provision of the First Amendment to the United States Constitution which declares that 'Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof * * *.' These companion cases present the issues in the context of state action requiring that schools begin each day with readings from the Bible. While raising the basic questions under slightly different factual situations, the cases permit of joint treatment. In light of the history of the First Amendment and of our cases interpreting and applying its requirements, we hold that the practices at issue and the laws requiring them are unconstitutional under the Establishment Clause, as applied to the States through the Fourteenth Amendment.
I.
2
The Facts in Each Case: No. 142. The Commonwealth of Pennsylvania by law, 24 Pa.Stat. § 15—1516, as amended, Pub.Law 1928 (Supp.1960) Dec. 17, 1959, requires that 'At least ten verses from the Holy Bible shall be read, without comment, at the opening of each public school on each school day. Any child shall be excused from such Bible reading, or attending such Bible reading, upon the written request of his parent or guardian.' The Schempp family, husband and wife and two of their three children, brought suit to enjoin enforcement of the statute, contending that their rights under the Fourteenth Amendment to the Constitution of the United States are, have been, and will continue to be violated unless this statute be declared unconstitutional as violative of these provisions of the First Amendment. They sought to enjoin the appellant school district, wherein the Schempp children attend school, and its officers and the Superintendent of Public Instruction of the Commonwealth from continuing to conduct such readings and recitation of the Lord's Prayer in the public schools of the district pursuant to the statute. A three-judge statutory District Court for the Eastern District of Pennsylvania held that the statute is violative of the Establishment Clause of the First Amendment as applied to the States by the Due Process Clause of the Fourteenth Amendment and directed that appropriate injunctive relief issue. D.C., 201 F.Supp. 815.1 On appeal by the District, its officials and the Superintendent, under 28 U.S.C. § 1253, we noted probable jurisdiction. 371 U.S. 807, 83 S.Ct. 25, 9 L.Ed.2d 52.
3
The appellees Edward Lewis Schempp, his wife Sidney, and their children, Roger and Donna, are of the Unitarian faith and are members of the Unitarian Church in Germantown, Philadelphia, Pennsylvania, where they, as well as another son, Ellory, regularly attend religious services. The latter was originally a party but having graduated from the school system pendente lite was voluntarily dismissed from the action. The other children attend the Abington Senior High School, which is a public school operated by appellant district.
4
On each school day at the Abington Senior High School between 8:15 and 8:30 a.m., while the pupils are attending their home rooms or advisory sections, opening exercises are conducted pursuant to the statute. The exercises are broadcast into each room in the school building through an intercommunications system and are conducted under the supervision of a teacher by students attending the school's radio and television workshop. Selected students from this course gather each morning in the school's workshop studio for the exercises, which include readings by one of the students of 10 verses of the Holy Bible, broadcast to each room in the building. This is followed by the recitation of the Lord's Prayer, likewise over the intercommunications system, but also by the students in the various classrooms, who are asked to stand and join in repeating the prayer in unison. The exercises are closed with the flag salute and such pertinent announcements as are of interest to the students. Participation in the opening exercises, as directed by the statute, is voluntary. The student reading the verses from the Bible may select the passages and read from any version he chooses, although the only copies furnished by the school are the King James version, copies of which were circulated to each teacher by the school district. During the period in which the exercises have been conducted the King James, the Douay and the Revised Standard versions of the Bible have been used, as well as the Jewish Holy Scriptures. There are no prefatory statements, no questions asked or solicited, no comments or explanations made and no interpretations given at or during the exercises. The students and parents are advised that the student may absent himself from the classroom or, should he elect to remain, not participate in the exercises.
5
It appears from the record that in schools not having an intercommunications system the Bible reading and the recitation of the Lord's Prayer were conducted by the home-room teacher,2 who chose the text of the verses and read them herself or had students read them in rotation or by volunteers. This was followed by a standing recitation of the Lord's Prayer, together with the Pledge of Allegiance to the Flag by the class in unison and a closing announcement of routine school items of interest.
6
At the first trial Edward Schempp and the children testified as to specific religious doctrines purveyed by a literal reading of the Bible 'which were contrary to the religious beliefs which they held and to their familial teaching.' 177 F.Supp. 398, 400. The children testified that all of the doctrines to which they referred were read to them at various times as part of the exercises. Edward Schempp testified at the second trial that he had considered having Roger and Donna excused from attendance at the exercises but decided against it for several reasons, including his belief that the children's relationships with their teachers and classmates would be adversely affected.3
7
Expert testimony was introduced by both appellants and appellees at the first trial, which testimony was summarized by the trial court as follows:
8
'Dr. Solomon Grayzel testified that there were marked differences between the Jewish Holy Scriptures and the Christian Holy Bible, the most obvious of which was the absence of the New Testament in the Jewish Holy Scriptures. Dr. Grayzel testified that portions of the New Testament were offensive to Jewish tradition and that, from the standpoint of Jewish faith, the concept of Jesus Christ as the Son of God was 'practically blasphemous'. He cited instances in the New Testament which, assertedly, were not only sectarian in nature but tended to bring the Jews into ridicule or scorn. Dr. Grayzel gave as his expert opinion that such material from the New Testament could be explained to Jewish children in such a way as to do no harm to them. But if portions of the New Testament were read without explanation, they could be, and in his specific experience with children Dr. Grayzel observed, had been, psychologically harmful to the child and had caused a divisive force within the social media of the school.
9
'Dr. Grayzel also testified that there was significant difference in attitude with regard to the respective Books of the Jewish and Christian Religions in that Judaism attaches no special significance to the reading of the Bible per se and that the Jewish Holy Scriptures are source materials to be studied. But Dr. Grayzel did state that many portions of the New, as well as of the Old, Testament contained passages of great literary and moral value.
10
'Dr. Luther A. Weigle, an expert witness for the defense, testified in some detail as to the reasons for and the methods employed in developing the King James and the Revised Standard Versions of the Bible. On direct examination, Dr. Weigle stated that the Bible was non-sectarian. He later stated that the phrase 'non-sectarian' meant to him non-sectarian within the Christian faiths. Dr. Weigle stated that his definition of the Holy Bible would include the Jewish Holy Scriptures, but also stated that the 'Holy Bible' would not be complete without the New Testament. He stated that the New Testament 'conveyed the message of Christians.' In his opinion, reading of the Holy Scriptures to the exclution of the New Testament would be a sectarian practice. Dr. Weigle stated that the Bible was of great moral, historical and literary value. This is conceded by all the parties and is also the view of the court.' 177 F.Supp. 398, 401—402.
11
The trial court, in striking down the practices and the statute requiring them, made specific findings of fact that the children's attendance at Abington Senior High School is compulsory and that the practice of reading 10 verses from the Bible is also compelled by law. It also found that:
12
'The reading of the verses, even without comment, possesses a devotional and religious character and constitutes in effect a religious observance. The devotional and religious nature of the morning exercises is made all the more apparent by the fact that the Bible reading is followed immediately by a recital in unison by the pupils of the Lord's Prayer. The fact that some pupils, or theoretically all pupils, might be excused from attendance at the exercises does not mitigate the obligatory nature of the ceremony for * * * Section 1516 * * * unequivocally requires the exercises to be held every school day in every school in the Commonwealth. The exercises are held in the school buildings and perforce are conducted by and uner the authority of the local school authorities and during school sessions. Since the statute requires the reading of the 'Holy Bible', a Christian document, the practice * * * prefers the Christian religion. The record demonstrates that it was the intention of * * * the Commonwealth * * * to introduce a religious ceremony into the public schools of the Commonwealth.' 201 F.Supp., at 819.
13
No. 119. In 1905 the Board of School Commissioners of Baltimore City adopted a rule pursuant to Art. 77, § 202 of the Annotated Code of Maryland. The rule provided for the holding of opening exercises in the schools of the city, consisting primarily of the 'reading, without comment, of a chapter in the Holy Bible and/or the use of the Lord's Prayer.' The petitioners, Mrs. Madalyn Murray and her son, William J. Murray III, are both professed atheists. Following unsuccessful attempts to have the respondent school board rescind the rule, this suit was filed for mandamus to compel its rescission and cancellation. It was alleged that William was a student in a public school of the city and Mrs. Murray, his mother, was a taxpayer therein; that it was the practice under the rule to have a reading on each school morning from the King James version of the Bible; that at petitioners' insistence the rule was amended4 to permit children to be excused from the exercise on request of the parent and that William had been excused pursuant thereto; that nevertheless the rule as amended was in violation of the petitioners' rights 'to freedom of religion under the First and Fourteenth Amendments' and in violation of 'the principle of separation between church and state, contained therein. * * *' The petition particularized the petitioners' atheistic beliefs and stated that the rule, as practiced, violated their rights
14
'in that it threatens their religious liberty by placing a premium on belief as against non-belief and subjects their freedom of conscience to the rule of the majority; it pronounces belief in God as the source of all moral and spiritual values, equating these values with religious values, and thereby renders sinister, alien and suspect the beliefs and ideals of your Petitioners, promoting doubt and question of their morality, good citizenship and good faith.'
15
The respondents demurred and the trial court, recognizing that the demurrer admitted all facts well pleaded, sustained it without leave to amend. The Maryland Court of Appeals affirmed, the majority of four justices holding the exercise not in violation of the First and Fourteenth Amendments, with three justices dissenting. 228 Md. 239, 179 A.2d 698. We granted certiorari. 371 U.S. 809, 83 S.Ct. 21, 9 L.Ed.2d 52.
II.
16
It is true that religion has been closely identified withour history and government. As we said in Engel v. Vitale, 370 U.S. 421, 434, 82 S.Ct. 1261, 1268, 8 L.Ed.2d 601 (1962), 'The history of man is inseparable from the history of religion. And * * * since the beginning of that history many people have devoutly believed that 'More things are wrought by prayer than this world dreams of." In Zorach v. Clauson, 343 U.S. 306, 313, 72 S.Ct. 679, 684, 96 L.Ed. 954 (1952), we gave specific recognition to the proposition that '(w)e are a religious people whose institutions presuppose a Supreme Being.' The fact that the Founding Fathers believed devotedly that there was a God and that the unalienable rights of man were rooted in Him is clearly evidenced in their writings, from the Mayflower Compact to the Constitution itself. This background is evidenced today in our public life through the continuance in our oaths of office from the Presidency to the Alderman of the final supplication, 'So help me God.' Likewise each House of the Congress provides through its Chaplain an opening prayer, and the sessions of this Court are declared open by the crier in a short ceremony, the final phrase of which invokes the grace of God. Again, there are such manifestations in our military forces, where those of our citizens who are under the restrictions of military service wish to engage in voluntary worship. Indeed, only last year an official survey of the country indicated that 64% of our people have church membership, Bureau of the Census, U.S. Department of Commerce, Statistical Abstract of the United States (83d ed. 1962), 48, while less than 3% profess no religion whatever. Id., at p. 46. It can be truly said, therefore, that today, as in the beginning, our national life reflects a religious people who, in the words of Madison, are 'earnestly praying, as * * * in duty bound, that the Supreme Lawgiver of the Universe * * * guide them into every measure which may be worthy of his (blessing * * *.)' Memorial and Remonstrance Against Religious Assessments, quoted in Everson v. Board of Education, 330 U.S. 1, 71—72, 67 S.Ct. 504, 538—539, 91 L.Ed. 711 (1947) (Appendix to dissenting opinion of Rutledge, J.).
17
This is not to say, however, that religion has been so identified with our history and government that religious freedom is not likewise as strongly imbeded in our public and private life. Nothing but the most telling of personal experiences in religious persecution suffered by our forebears, see Everson v. Board of Education, supra, 330 U.S., at 8—11, 67 S.Ct., at 507 509, 91 L.Ed. 711, could have planted our belief in liberty of religious opinion any more deeply in our heritage. It is true that this liberty frequently was not realized by the colonists, but this is readily accountable by their close ties to the Mother Country.5 However, the views of Madison and Jefferson, preceded by Roger Williams,6 came to be incorporated not only in the Federal Constitution but likewise in those of most of our States. This freedom to worship was indispensable in a country whose people came from the four quarters of the earth and brought with them a diversity of religious opinion. Today authorities list 83 separate religious bodies, each with membership exceeding 50,000, existing among our people, as well as innumerable smaller groups. Bureau of the Census, op. cit., supra, at 46—47.
III.
18
Almost a hundred years ago in Minor v. Board of Education of Cincinnati,7 Judge Alphonso Taft, father of the revered Chief Justice, in an unpublished opinion stated the ideal of our people as to religious freedom as one of
19
'absolute equality before the law, of all religious opinions and sects * * *.
20
'The government is neutral, and, while protecting all, it prefers none, and it disparages none.'
21
Before examining this 'neutral' position in which the Establishment and Free Exercise Clauses of the First Amendment place our Government it is well that we discuss the reach of the Amendment under the cases of this Court.
22
First, this Court has decisively settled that the First Amendment's mandate that 'Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof' has been made wholly applicable to the States by the Fourteenth Amendment. Twenty-three years ago in Cantwell v. Connecticut, 310 U.S. 296, 303, 60 S.Ct. 900, 903, 84 L.Ed. 1213 (1940), this Court, through Mr. Justice Roberts, said:
23
'The fundamental concept of liberty embodied in that (Fourteenth) Amendment embraces the liberties guaranteed by the First Amendment. The First Amendment declares that Congress shall make no law respecting an establishment of religion or prohibiting the free exercise thereof. The Fourteenth Amendment has rendered the legislatures of the states as incompetent as Congress to eanct such laws. * * *'8
24
In a series of cases since Cantwell the Court has repeatedly reaffirmed that doctrine, and we do so now. Murdock v. Commonwealth of Pennsylvania, 319 U.S. 105, 108, 63 S.Ct. 870, 872, 87 L.Ed. 1292 (1943); Everson v. Board of Education, supra; Illinois ex rel. McCollum v. Board of Education, 333 U.S. 203, 210 211, 68 S.Ct. 461, 464—465, 92 L.Ed. 648 (1948); Zorach v. Clauson, supra; McGowan v. Maryland, 366 U.S. 420, 81 S.Ct. 1101, 6 L.Ed.2d 393 (1961); Torcaso v. Watkins, 367 U.S. 488, 81 S.Ct. 1680, 6 L.Ed.2d 982 (1961); and Engel v. Vitale, supra.
25
Second, this Court has rejected unequivocally the contention that the Establishment Clause forbids only governmental preference of one religion over another. Almost 20 years ago in Everson, supra, 330 U.S., at 15, 67 S.Ct., at 511, 91 L.Ed. 711, the Court said that '(n)either a state nor the Federal Government can set up a church. Neither can pass laws which aid one religion, aid all religions, or prefer one religion over another.' And Mr. Justice Jackson, dissenting, agreed:
26
'There is no answer to the proposition * * * that the effect of the religious freedom Amendment to our Constitution was to take every form of propagation of religion out of the realm of things which could directly or indirectly be made public business and thereby be supported in whole or in part at taxpayers' expense. * * * This freedom was first in the Bill of Rights because it was first in the forefathers' minds; it was set forth in absolute terms, and its strength is its rigidity.' Id., 330 U.S., at 26, 67 S.Ct., at 516, 91 L.Ed. 711.
27
Further Mr. Justice Rutledge, joined by Justices Frankfurter, Jackson and Burton, declared:
28
'The (First) Amendment's purpose was not to strike merely at the official establishment of a single sect, creed or religion, outlawing only a formal relation such as had prevailed in England and some of the colonies. Necessarily it was to uproot all such relationships. But the object was broader than separating church and state in this narrow sense. It was to create a complete and permanent separation of the spheres of religious activity and civil authority by comprehensively forbidding every form of public aid or support for religion.' Id., 330 U.S., at 31—32, 67 S.Ct., at 519, 91 L.Ed. 711.
29
The same conclusion has been firmly maintained ever since that time, see Illinois ex rel. McCollum, supra, 333 U.S., at pp. 210—211, 68 S.Ct., at pp. 464—465, 92 L.Ed. 648; McGowan v. Maryland, supra, 366 U.S., at 442—443, 81 S.Ct., at 1113—1114, 6 L.Ed.2d 393; Torcaso v. Watkins, supra, 367 U.S., at 492—493, 495, 81 S.Ct., at 1682—1683, 1684, 6 L.Ed.2d 982, and we reaffirm it now.
30
While none of the parties to either of these cases has questioned these basic conclusions of the Court, both of which have been long established, recognized and consistently reaffirmed, others continue to question their history, logic and efficacy. Such contentions, in the light of the consistent interpretation in cases of this Court, seem entirely untenable and of value only as academic exercises.
IV.
31
The interrelationship of the Establishment and the Free Exercise Clauses was first touched upon by Mr. Justice Roberts for the Court in Cantwell v. Connecticut, supra, 310 U.S., at 303—304, 60 S.Ct., at 903, 84 L.Ed. 1213, where it was said that their 'inhibition of legislation' had
32
'a double aspect. On the one hand, it forestalls compulsion by law of the acceptance of any creed or the practice of any form of worship. Freedom of conscience and freedom to adhere to such religious organization or form of worship as the individual may choose cannot be restricted by law. On the other hand, it safeguards the free exercise of the chosen form of religion. Thus the Amendment embraces two concepts,—freedom to believe and freedom to act. The first is absolute but, in the nature of things, the second cannot be.'
33
A half dozen years later in Everson v. Board of Education, supra, 330 U.S., at 14—15, 67 S.Ct., at 511, 91 L.Ed. 711, this Court, through Mr. Justice BLACK, stated that the 'scope of the First Amendment * * * was designed forever to suppress' the establishment of religion or the prohibition of the free exercise thereof. In short, the Court held that the Amendment
34
'requires the state to be a neutral in its relations with groups of religious believers and non-believers; it does not require the state to be their adversary. State power is no more to be used so as to handicap religions, than it is to favor them.' Id., 330 U.S., at 18, 67 S.Ct. at 513, 91 L.Ed. 711.
35
And Mr. Justice Jackson, in dissent, declared that public schools are organized
36
'on the premise that secular education can be isolated from all religious teaching so that the school can inculcate all needed temporal knowledge and also maintain a strict and lofty neutrality as to religion. The assumption is that after the individual has been instructed in worldly wisdom he will be better fitted to chose his religion.' Id., 330 U.S., at 23 24, 67 S.Ct. at 515, 91 L.Ed. 711.
37
Moreover, all of the four dissenters, speaking through Mr. Justice Rutledge, agreed that
38
'Our constitutional policy * * * does not deny the value or the necessity for religious training, teaching or observance. Rather it secures their free exercise. But to that end it does deny that the state can undertake or sustain them in any form or degree. For this reason the sphere of religious activity, as distinguished from the secular intellectual liberties, has been given the twofold protection and, as the state cannot forbid, neither can it perform or aid in performing the religious function. The dual prohibition makes that function altogether private.' Id., 330 U.S., at 52, 67 S.Ct., at 529, 91 L.Ed. 711.
39
Only one year later the Court was asked to reconsider and repudiate the doctrine of these cases in McCollum v. Board of Education. It was argued that 'historically the First Amendment was intended to forbid only government preference of one religion over another * * *. In addition they ask that we distinguish or overrule our holding in the Everson case that the Fourteenth Amendment made the 'establishment of religion' clause of the First Amendment applicable as a prohibition against the States.' 333 U.S., at 211, 68 S.Ct., at 465, 92 L.Ed. 648. The Court, with Mr. Justice Reed alone dissenting, was unable to 'accept either of these contentions.' Ibid. Mr. Justice Frankfurter, joined by Justices Jackson, Rutledge and Burton, wrote a very comprehensive and scholarly concurrence in which he said that '(s)eparation is a requirement to abstain from fusing functions of Government and of religious sects, not merely to treat them all equally.' Id., 333 U.S., at 227, 68 S.Ct., at 473, 92 L.Ed. 648. Continuing, he stated that:
40
'the Constitution * * * prohibited the Government common to all from becoming embroiled, however innocently, in the destructive religious conflicts of which the history of even this country records some dark pages.' Id., 333 U.S., at 228, 68 S.Ct., at 473, 92 L.Ed. 648.
41
In 1952 in Zorach v. Clauson, supra, Mr. Justice DOUGLAS for the Court reiterated:
42
'There cannot be the slightest doubt that the First Amendment reflects the philosophy that Church and State should be separated. And so far as interference with the ';ree exercise' of religion and an 'ESTABLISHMENT' OF RELIGION ARE CONCERNED, the separation must be complete and unequivocal. The First Amendment within the scope of its coverage permits no exception; the prohibition is absolute. The First Amendment, however, does not say that in every and all respects there shall be a separation of Church and State. Rather, it studiously defines the manner, the specific ways, in which there shall be no concert or union or dependency one on the other. That is the common sense of the matter.' 343 U.S., at 312, 72 S.Ct., at 683, 96 L.Ed. 954.
43
And then in 1961 in McGowan v. Maryland and in Torcaso v. Watkins each of these cases was discussed and approved. Chief Justice WARREN in McGowan, for a unanimous Court on this point, said:
44
'But, the First Amendment, in its final form, did not simply bar a congressional enactment establishing a church; it forbade all laws respecting an establishment of religion. Thus, this Court has given the Amendment a 'broad interpretation * * * in the light of its history and the evils it was designed forever to suppress * * *." 366 U.S., at 441—442, 81 S.Ct., at 1113, 6 L.Ed.2d 393.
45
And Mr. Justice BLACK for the Court in Torcaso, without dissent but with Justices FRANKFURTER and HARLAN concurring in the result, used this language:
46
'We repeat and again reaffirm that neither a State nor the Federal Government can constitutionally force a person 'to profess a belief or disbelief in any religion.' Neither can constitutionally pass laws or impose requirements which aid all religions as against non-believers, and neither can aid those religions based on a belief in the existence of God as against those religions founded on different beliefs.' 367 U.S., at 495, 81 S.Ct., at 1683, 6 L.Ed.2d 982.
47
Finally, in Engel v. Vitale, only last year, these principles were so universally recognized that the Court, without the citation of a single case and over the sole dissent of Mr. Justice STEWART, reaffirmed them. The Court found the 22-word prayer used in 'New York's program of daily classroom invocation of God's blessings as prescribed in the Regents' prayer * * * (to be) a religious activity.' 370 U.S., at 424, 82 S.Ct., at 1264, 8 L.Ed.2d 601. It held that 'it is no part of the business of government to compose official prayers for any group of the American people to recite as a part of a religious program carried on by government.' Id., 370 U.S., at 425, 82 S.Ct., at 1264, 8 L.Ed.2d 601. In discussing the reach of the Establishment and Free Exercise Clauses of the First Amendment the Court said:
48
'Although these two clauses may in certain instances overlap, they forbid two quite different kinds of governmental encroachment upon religious freedom. The Establishment Clause, unlike the Free Exercise Clause, does not depend upon any showing of direct governmental compulsion and is violated by the enactment of laws which establish an official religion whether those laws operate directly to coerce non-observing individuals or not. This is not to say, of course, that laws officially prescribing a particular form of religious worship do not involve coercion of such individuals. When the power, prestige and financial support of government is placed behind a particular religious belief, the indirect coercive pressure upon religious minorities to conform to the prevailing officially approved religion is plain.' Id., 370 U.S., at 430 431, 82 S.Ct., at 1267, 8 L.Ed.2d 601.
49
And in further elaboration the Court found that the 'first and most immediate purpose (of the Establishment Clause) rested on the belief that a union of government and religion tends to destroy government and to degrade religion.' Id., 370 U.S. at 431, 82 S.Ct., at 1267, 8 L.Ed.2d 601. When government, the Court said, allies itself with one particular form of religion, the inevitable result is that it incurs 'the hatred, disrespect and even contempt of those who held contrary beliefs.' Ibid.
V.
50
The wholesome 'neutrality' of which this Court's cases speak thus stems from a recognition of the teachings of history that powerful sects or groups might bring about a fusion of governmental and religious functions or a concert or dependency of one upon the other to the end that official support of the State or Federal Government would be placed behind the tenets of one or of all orthodoxies. This the Establishment Clause prohibits. And a further reason for neutrality is found in the Free Exercise Clause, which recognizes the value of religious training, teaching and observance and, more particularly, the right of every person to freely choose his own course with reference thereto, free of any compulsion from the state. This the Free Exercise Clause guarantees. Thus, as we have seen, the two clauses may overlap. As we have indicated, the Establishment Clause has been directly considered by this Court eight times in the past score of years and, with only one Justice dissenting on the point, it has consistently held that the clause withdrew all legislative power respecting religious belief or the expression thereof. The test may be stated as follows: what are the purpose and the primary effect of the enactment? If either is the advancement or inhibition of religion then the enactment exceeds the scope of legislative power as circumscribed by the Constitution. That is to say that to withstand the strictures of the Establishment Clause there must be a secular legislative purpose and a primary effect that neither advances nor inhibits religion. Everson v. Board of Education, supra; McGowan v. Maryland, supra, 366 U.S., at 442, 81 S.Ct. at 1113—114, 6 L.Ed.2d 393. The Free Exercise Clause, likewise considered many times here, withdraws from legislative power, state and federal, the exertion of any restraint on the free exercise of religion. Its purpose is to secure religious liberty in the individual by prohibiting any invasions thereof by civil authority. Hence it is necessary in a free exercise case for one to show the coercive effect of the enactment as it operates against him in the practice of his religion. The distinction between the two clauses is apparent—a violation of the Free Exercise Clause is predicated on coercion while the Establishment Clause violation need not be so attended.
51
Applying the Establishment Clause principles to the cases at bar we find that the States are requiring the selection and reading at the opening of the school day of verses from the Holy Bible and the recitation of the Lord's Prayer by the students in unison. These exercises are prescribed as part of the curricular activities of students who are required by law to attend school. They are held in the school buildings under the supervision and with the participation of teachers employed in those schools. None of these factors, other than compulsory school attendance, was present in the program upheld in Zorach v. Clauson. The trial court in No. 142 has found that such an opening exercise is a religious ceremony and was intended by the State to be so. We agree with the trial court's finding as to the religious character of the exercises. Given that finding, the exercises and the law requiring them are in violation of the Establishment Clause.
52
There is no such specific finding as to the religious character of the exercises in No. 119, and the State contends (as does the State in No. 142) that the program is an effort to extend its benefits to all public school children without regard to their religious belief. Included within its secular purposes, it says, are the promotion of moral values, the contradiction to the materialistic trends of our times, the perpetuation of our institutions and the teaching of literature. The case came up on demurrer, of course, to a petition which alleged that the uniform practice under the rule had been to read from the King James version of the Bible and that the exercise was sectarian. The short answer, therefore, is that the religious character of the exercise was admitted by the State. But even if its purpose is not strictly religious, it is sought to be accomplished through readings, without comment, from the Bible. Surely the place of the Bible as an instrument of religion cannot be gainsaid, and the State's recognition of the pervading religious character of the ceremony is evident from the rule's specific permission of the alternative use of the Catholic Douay version as well as the recent amendment permitting nonattendance at the exercises. None of these factors is consistent with the contention that the Bible is here used either as an instrument for nonreligious moral inspiration or as a reference for the teaching of secular subjects.
53
The conclusion follows that in both cases the laws require religious exercises and such exercises are being conducted in direct violation of the rights of the appellees and petitioners.9 Nor are these required exercises mitigated by the fact that individual students may absent themselves upon parental request, for that fact furnishes no defense to a claim of unconstitutionality under the Establishment Clause. See Engel v. Vitale, supra, 370 U.S., at 430, 82 S.Ct., at 1266—1267, 8 L.Ed.2d 601. Further, it is no defense to urge that the religious practices here may be relatively minor encroachments on the First Amendment. The breach of neutrality that is today a trickling stream may all too soon become a raging torrent and, in the words of Madison, 'it is proper to take alarm at the first experiment on our liberties.' Memorial and Remonstrance Against Religious Assessments, quoted in Everson, supra, 330 U.S., at 65, 67 S.Ct., at 536, 91 L.Ed. 711.
54
It is insisted that unless these religious exercises are permitted a 'religion of secularism' is established in the schools. We agree of course that the State may not establish a 'religion of secularism' in the sense of affirmatively opposing or showing hostility to religion, thus 'preferring those who believe in no religion over those who do believe.' Zorach v. Clauson, supra, 343 U.S., at 314, 72 S.Ct., at 684, 96 L.Ed. 954. We do not agree, however, that this decision in any sense has that effect. In addition, it might well be said that one's education is not complete without a study of comparative religion or the history of religion and its relationship to the advancement of civilization. It certainly may be said that the Bible is worthy of study for its literary and historic qualities. Nothing we have said here indicates that such study of the Bible or of religion, when presented objectively as part of a secular program of education, may not be effected consistently with the First Amendment. But the exercises here do not fall into those categories. They are religious exercises, required by the States in violation of the command of the First Amendment that the Government maintain strict neutrality, neither aiding nor opposing religion.
55
Finally, we cannot accept that the concept of neutrality, which does not permit a State to require a religious exercise even with the consent of the majority of those affected, collides with the majority's right to free exercise of religion.10 While the Free Exercise Clause clearly prohibits the use of state action to deny the rights of free exercise to anyone, it has never meant that a majority could use the machinery of the State to practice its beliefs. Such a contention was effectively answered by Mr. Justice Jackson for the Court in West Virginia Board of Education v. Barnette, 319 U.S. 624, 628, 63 S.Ct. 117,, 1185, 87 L.Ed. 1628 (1943):
56
'The very purpose of a Bill of Rights was to withdraw certain subjects from the vicissitudes of political controversy, to place them beyond the reach of majorities and officials and to establish them as legal principles to be applied by the courts. One's right to * * * freedom of worship * * * and other fundamental rights may not be submitted to vote; they depend on the outcome of no elections.'
57
The place of religion in our society is an exalted one, achieved through a long tradition of reliance on the home, the church and the inviolable citadel of the individual heart and mind. We have come to recognize through bitter experience that it is not within the power of government to invade that citadel, whether its purpose or effect be to aid or oppose, to advance or retard. In the relationship between man and religion, the State is firmly committed to a position of neutrality. Though the application of that rule requires interpretation of a delicate sort, the rule itself is clearly and concisely stated in the words of the First Amendment. Applying that rule to the facts of these cases, we affirm the judgment in No. 142. In No. 119, the judgment is reversed and the cause remanded to the Maryland Court of Appeals for further proceedings consistent with this opinion.
58
It is so ordered.
59
Judgment in No. 142 affirmed; judgment in No. 119 reversed and cause remanded with directions.
60
Mr. Justice DOUGLAS, concurring.
61
I join the opinion of the Court and add a few words in explanation.
62
While the Free Exercise Clause of the First Amendment is written in terms of what the State may not require of the individual, the Establishment Clause, serving the same goal of individual religious freedom, is written in different terms.
63
Establishment of a religion can be achieved in several ways. The church and state can be one; the church may control the state or the state may control the church; or the relationship may take one of several possible forms of a working arrangment between the two bodies.1 Under all of these arrangements the church typically has a place in the state's budget, and church law usually governs such matters as baptism, marriage, divorce and separation, at least for its members and sometimes for the entire body politic.2 Education, too, is usually high on the priority list of church interests.3 In the past schools were often made the exclusive responsibility of the church. Today in some state-church countries the state runs the public schools, but compulsory religious exercises are often required of some or all students. Thus, under the agreement Franco made with the Holy See when he came to power in Spain, 'The Church regained its place in the national budget. It insists on baptizing all children and has made the catechism obligatory in state schools.'4
64
The vice of all such arrangements under the Establishment Clause is that the state is lending its assistance to a church's efforts to gain and keep adherents. Under the First Amendment it is strictly a matter for the individual and his church as to what church he will belong to and how much support, in the way of belief, time, activity or money, he will give to it. 'This pure Religious Liberty' 'declared * * * (all forms of church-state relationships) and their fundamental idea to be oppressions of conscience and abridgments of that liberty which God and nature had conferred on every living soul.'5
65
In these cases we have no coercive religious exercise aimed at making the students conform. The prayers announced are not compulsory, though some may think they have that indirect effect because the nonconformist student may be induced to participate for fear of being called an 'oddball.' But that coercion, if it be present, has not been shown; so the vices of the present regimes are different.
66
These regimes violate the Establishment Clause in two different ways. In each case the State is conducting a religious exercise; and, as the Court holds, that cannot be done without violating the 'neutrality' required of the State by the balance of power between individual, church and state that has been struck by the First Amendment. But the Establishment Clause is not limited to precluding the State itself from conducting religious exercises. It also forbids the State to employ its facilities or funds in a way that gives any church, or all churches, greater strength in our society than it would have by relying on its members alone. Thus, the present regimes must fall under that clause for the additional reason that public funds, though small in amount, are being used to promote a religious exercise. Through the mechanism of the State, all of the people are being required to finance a religious exercise that only some of the people want and that violates the sensibilities of others.
67
The most effective way to establish any institution is to finance it; and this truth is reflected in the appeals by church groups for public funds to finance their religious schools.6 Financing a church either in its strictly religious activities or in its other activities is equally unconstitutional, as I understand the Establishment Clause. Budgets for one activity may be technically separable from budgets for others.7 But the institution is an inseparable whole, a living organism, which is strengthened in proselytizing when it is strengthened in any department by contributions from other than its own members.
68
Such contributions may not be made by the State even in a minor degree without violating the Establishment Clause. It is not the amount of public funds expended; as this case illustrates, it is the use to which public funds are put that is controlling. For the First Amendment does not say that some forms of establishment are allowed; it says that 'no law respecting an establishment of religion' shall be made. What may not be done directly may not be done indirectly lest the Establishment Clause become a mockery.
69
Mr. Justice BRENNAN, concurring.
70
Almost a century and a half ago, John Marshall, In M'Culloch v. Maryland, enjoined: '* * * we must never forget, that it is a constitution we are expounding.' 4 Wheat. 316, 407, 4 L.Ed. 579. The Court's historic duty to expound the meaning of the Constitution has encountered few issues more intricate or more demanding than that of the relationship between religion and the public schools. Since undoubtedly we are 'a religious people whose institutions presuppose a Supreme Being,' Zorach v. Clauson, 343 U.S. 306, 313, 72 S.Ct. 679, 684, 96 L.Ed. 954, deep feelings are aroused when aspects of that relationship are claimed to violate the injunction of the First Amendment that government may make 'no law respecting an establishment of religion, or prohibiting the free exercise thereof * * *.' Americans regard the public schools as a most vital civic institution for the preservation of a democratic system of government. It is therefore understandable that the constitutional prohibitions encounter their severest test when they are sought to be applied in the school classroom. Nevertheless it is this Court's inescapable duty to declare whether exercises in the public schools of the States, such as those of Pennsylvania and Maryland questioned here, are involvements of religion in public institutions of a kind which offends the First and Fourteenth Amendments.
71
When John Locke ventured in 1689, 'I esteem it above all things necessary to distinguish exactly the business of civil government from that of religion and to settle the just bounds that lie between the one and the other,'1 he anticipated the necessity which would be thought by the Framers to require adoption of a First Amendment, but not the difficulty that would be experienced in defining those 'just bounds.' The fact is that the line which separates the secular from the sectarian in American life is elusive. The difficulty of defining the boundary with precision inheres in a paradox central to our scheme of liberty. While our institutions reflect a firm conviction that we are a religious people, those institutions by solemn constitutional injunction may not officially involve religion in such a way as to prefer, discriminate against, or oppress, a particular sect or religion. Equally the Constitution enjoins those involvements of religious with secular institutions which (a) serve the essentially religious activities of religious institutions; (b) employ the organs of government for essentially religious purposes; or (c) use essentially religious means to serve governmental ends where secular means would suffice. The constitutional mandate expresses a deliberate and considered judgment that such matters are to be left to the conscience of the citizen, and declares as a basic postulate of the relation between the citizen and his government that 'the rights of conscience are, in their nature, of peculiar delicacy, and will little bear the gentlest touch of governmental hand * * *.'2
72
I join fully in the opinion and the judgment of the Court. I see no escape from the conclusion that the exercises called in question in these two cases violate the constitutional mandate. The reasons we gave only last Term in Engel v. Vitale, 370 U.S. 421, 82 S.Ct. 1261, 8 L.Ed.2d 601, for finding in the New York Regents' prayer an impermissible establishment of religion, compel the same judgment of the practices at bar. The involvement of the secular with the religious is no less intimate here; and it is constitutionally irrelevant that the State has not composed the material for the inspirational exercises presently involved. It should be unnecessary to observe that our holding does not declare that the First Amendment manifests hostility to the practice or teaching of religion, but only applies prohibitions incorporated in the Bill of Rights in recognition of historic needs shared by Church and State alike. While it is my view that not every involvement of religion in public life is unconstitutional, I consider the exercises at bar a form of involvement which clearly violates the Establishment Clause.
73
The importance of the issue and the deep conviction with which views on both sides are held seem to me to justify detailing at some length my reasons for joining the Court's judgment and opinion.
I.
74
The First Amendment forbids both the abridgment of the free exercise of religion and the enactment of laws 'respecting an establishment of religion.' The two clauses, although distinct in their objectives and their applicability, emerged together from a common panorama of history. The inclusion of both restraints upon the power of Congress to legislate concerning religious matters shows unmistakably that the Framers of the First Amendment were not content to rest the protection of religious liberty exclusively upon either clause. 'In assuring the free exercise of religion,' Mr. Justice Frankfurter has said, 'the Framers of the First Amendment were sensitive to the then recent history of those persecutions and impositions of civil disability with which sectarian majorities in virtually all of the Colonies had visited deviation in the matter of conscience. This protection of unpopular creeds, however, was not to be the full extent of the Amendment's guarantee of freedom from governmental intrusion in matters of faith. The battle in Virginia, hardly four years won, where James Madison had led the forces of disestablishment in successful opposition to Patrick Henry's proposed Assessment Bill levying a general tax for the support of Christian teachers, was a vital and compelling memory in 1789.' McGowan v. Maryland, 366 U.S. 420, 464—465, 81 S.Ct. 1101, 1155 1156, 6 L.Ed.2d 393.
75
It is true that the Framers' immediate concern was to prevent the setting up of an official federal church of the kind which England and some of the Colonies had long supported. But nothing in the text of the Establishment Clause supports the view that the prevention of the setting up of an official church was meant to be the full extent of the prohibitions against official involvements in religion. It has rightly been said:
76
'If the framers of the Amendment meant to prohibit Congress merely from the establishment of a 'church,' one may properly wonder why they didn't so state. That the words church and religion were regarded as synonymous seems highly improbable, particularly in view of the fact that the contemporary state constitutional provisions dealing with the subject of establishment used definite phrases such as 'religious sect,' 'sect,' or 'denomination.' * * * With such specific wording in contemporary state constitutions, why was not a similar wording adopted for the First Amendment if its framers intended to prohibit nothing more than what the States were prohibiting?' Lardner, How Far Does the Constitution Separate Church and State? 45 Am.Pol.Sic.Rev. 110, 112 (1951).
77
Plainly, the Establishment Clause, in the contemplation of the Framers, 'did not limit the constitutional proscription to any particular, dated form of state-supported theological venture.' 'What Virginia had long practiced, and what Madison, Jefferson and others fought to end, was the extension of civil government's support to religion in a manner which made the two in some degree interdependent, and thus threatened the freedom of each. The purpose of the Establishment Clause was to assure that the national legislature would not exert its power in the service of any purely religious end; that it would not, as Virginia and virtually all of the Colonies had done, make of religion, as religion, an object of legislation. * * * The Establishment Clause withdrew from the sphere of legitimate legislative concern and competence a specific, but comprehensive, area of human conduct: man's belief or disbelief in the verity of some transcendental idea and man's expression in action of that belief or disbelief.' McGowan v. Maryland, supra, 366 U.S. at 465—466, 81 S.Ct. at 1156 1157 (opinion of Frankfurter, J.).
78
In sum, the history which our prior decisions have summoned to aid interpretation of the Establishment Clause permits little doubt that its prohibition was designed comprehensively to prevent those official involvements of religion which would tend to foster or discourage religious worship or belief.
79
But an awareness of history and an appreciation of the aims of the Founding Fathers do not always resolve concrete problems. The specific question before us has, for example, aroused vigorous dispute whether the architects of the First Amendment—James Madison and Thomas Jefferson particularly—understood the prohibition against any 'law respecting an establishment of religion' to reach devotional exercises in the public schools.3 It may be that Jefferson and Madison would have held such exercises to be permissible—although even in Jefferson's case serious doubt is suggested by his admonition against 'putting the Bible and Testament into the hands of the children at an age when their judgments are not sufficiently matured for religious inquiries. * * *'4 But I doubt that their view, even if perfectly clear one way or the other, would supply a dispositive answer to the question presented by these cases. A more fruitful inquiry, it seems to me, is whether the practices here challenged threaten those consequences which the Framers deeply feared; whether, in short, they tend to promote that type of interdependence between religion and state which the First Amendment was designed to prevent.5 Our task is to translate 'the majestic generalities of the Bill of Rights, conceived as part of the pattern of liberal government in the eighteenth century, into concrete restraints on officials dealing with the problems of the twentieth century * * *.' West Virginia State Board of Education v. Barnette, 319 U.S. 624, 639, 63 S.Ct. 1178, 1186, 87 L.Ed. 1628.
80
A too literal quest for the advice of the Founding Fathers upon the issues of these cases seems to me futile and misdirected for several reasons: First, on our precise problem the historical record is at best ambiguous, and statements can readily be found to support either side of the proposition. The ambiguity of history is understandable if we recall the nature of the problems uppermost in the thinking of the statesmen who fashioned the religious guarantees; they were concerned with far more flagrant intrusions of government into the realm of religion than any that our century has witnessed.6 While it is clear to me that the Framers meant the Establishment Clause to prohibit more than the creation of an established federal church such as existed in England, I have no doubt that, in their preoccupation with the imminent question of established churches, they gave no distinct consideration to the particular question whether the clause also forbade devotional exercises in public institutions.
81
Second, the structure of American education has greatly changed since the First Amendment was adopted. In the context of our modern emphasis upon public education available to all citizens, any views of the eighteenth century as to whether the exercises at bar are an 'establishment' offer little aid to decision. Education, as the Framers knew it, was in the main confined to private schools more often than not under strictly sectarian supervision. Only gradually did control of education pass largely to public officials.7 It would, therefore, hardly be significant if the fact was that the nearly universal devotional exercises in the schools of the young Republic did not provoke criticism; even today religious ceremonies in church-supported private schools are constitutionally unobjectionable.
82
Third, our religious composition makes us a vastly more diverse people than were our forefathers. They knew differences chiefly among Protestant sects. Today the Nation is far more heterogeneous religiously, including as it does substantial minorities not only of Catholics and Jews but as well of those who worship according to no version of the Bible and those who worship no God at all.8 See Torcaso v. Watkins, 367 U.S. 488, 495, 81 S.Ct. 1680, 1683, 6 L.Ed.2d 982. In the face of such profound changes, practices which may have been objectionable to no one in the time of Jefferson and Madison may today be highly offensive to many persons, the deeply devout and the nonbelievers alike.
83
Whatever Jefferson or Madison would have thought of Bible reading or the recital of the Lord's Prayer in what few public schools existed in their day, our use of the history of their time must limit itself to broad purposes, not specific practices. By such a standard, I am persuaded, as is the Court, that the devotional exercises carried on in the Baltimore and Abington schools offend the First Amendment because they sufficiently threaten in our day those substantive evils the fear of which called forth the Establishment Clause of the First Amendment. It is 'a constitution we are expounding,' and our interpretation of the First Amendment must necessarily be responsive to the much more highly charged nature of religious questions in contemporary society.
84
Fourth, the American experiment in free public education available to all children has been guided in large measure by the dramatic evolution of the religious diversity among the population which our public schools serve. The interaction of these two important forces in our national life has placed in bold relief certain positive values in the consistent application to public institutions generally, and public schools particularly, of the constitutional decree against offical involvements of religion which might produce the evils the Framers meant the Establishment Clause to forestall. The public schools are supported entirely, in most communities, by public funds—funds exacted not only from parents, nor alone from those who hold particular religious views, nor indeed from those who subscribe to any creed at all. It is implicit in the history and character of American public education that the public schools serve a uniquely public function: the training of American citizens in an atmosphere free of parochial, divisive, or separatist influences of any sort—an atmosphere in which children may assimilate a heritage common to all American groups and religions. See Illinois ex rel. McCollum v. Board of Education, 333 U.S. 203, 68 S.Ct. 461, 92 L.Ed. 648. This is a heritage neither theistic nor atheistic, but simply civic and patriotic. See Meyer v. Nebraska, 262 U.S. 390, 400—403, 43 S.Ct. 625, 627—628, 67 L.Ed. 1042.
85
Attendance at the public schools has never been compulsory; parents remain morally and constitutionally free to choose the academic environment in which they wish their children to be educated. The relationship of the Establishment Clause of the First Amendment to the public school system is preeminently that of reserving such a choice to the individual parent, rather than vesting it in the majority of voters of each State or school district. The choice which is thus preserved is between a public secular education with its uniquely democratic values, and some form of private or sectarian education, which offers values of its own. In my judgment the First Amendment forbids the State to inhibit that freedom of choice by diminishing the attractiveness of either alternative—either by restricting the liberty of the private schools to inculcate whatever values they wish, or by jeopardizing the freedom of the public schools from private or sectarian pressures. The choice between these very different forms of education is one—very much like the choice of whether or not to worship—which our Constitution leaves to the individual parent. It is no proper function of the state or local government to influence or restrict that election. The lesson of history—drawn more from the experiences of other countries than from our own—is that a system of free public education forfeits its unique contribution to the growth of democratic citizenship when that choice ceases to be freely available to each parent.
II.
86
The exposition by this Court of the religious guarantees of the First Amendment has consistently reflected and reaffirmed the concerns which impelled the Framers to write those guarantees into the Constitution. It would be neither possible nor appropriate to review here the entire course of our decisions on religious questions. There emerge from those decisions, however, three principles of particular relevance to the issue presented by the case at bar, and some attention to those decisions is therefore appropriate.
87
First. On line of decisions derives from contests for control of a church property or other internal ecclesiastical disputes. This line has settled the proposition that in order to give effect to the First Amendment's purpose of requiring on the part of all organs of government a strict neutrality toward theological questions, courts should not undertake to decide such questions. These principles were first expounded in the case of Watson v. Jones, 13 Wall. 679, 20 L.Ed. 666, which declared that judicial intervention in such a controversy would open up 'the whole subject of the doctrinal theology, the usages and customs, the written laws, and fundamental organization of every religious denomination * * *.' 13 Wall., at 733. Courts above all must be neutral, for '(t)he law knows no heresy, and is committed to the support of no dogma, the establishment of no sect.'9 13 Wall., at 728. This principle has recently been reaffirmed in Kedroff v. St. Nicholas Cathedral, 344 U.S. 94, 73 S.Ct. 143, 97 L.Ed. 120; and Kreshik v. St. Nicholas Cathedral, 363 U.S. 190, 80 S.Ct. 1037, 4 L.Ed.2d 1140.
88
The mandate of judicial neutrality in theological controversies met its severest test in United States v. Ballard, 322 U.S. 78, 64 S.Ct. 882, 88 L.Ed. 1148. That decision put in sharp relief certain principles which bear directly upon the questions presented in these cases. Ballard was indicted for fraudulent use of the mails in the dissemination of religious literature. He requested that the trial court submit to the jury the question of the truthfulness of the religious views he championed. The requested charge was refused, and we upheld that refusal, reasoning that the First Amendment foreclosed any judicial inquiry into the truth or falsity of the defendant's religious beliefs. We said: 'Man's relation to his God was made no concern of the state. He was granted the right to worship was he pleased and to answer to no man for the verity of his religious views.' 'Men may believe what they cannot prove. They may not be put to the proof of their religious doctrines or beliefs. * * * Many take their gospel from the New Testament. But it would hardly be supposed that they could be tried before a jury charged with the duty of determining whether those teachings contained false representations.' 322 U.S., at 86 87, 64 S.Ct., at 886—887.
89
The dilemma presented by the case was severe. While the alleged truthfulness of nonreligious publications could ordinarily have been submitted to the jury, Ballard was deprived of that defense only because the First Amendment forbids governmental inquiry into the verity of religious beliefs. In dissent Mr. Justice Jackson expressed the concern that under this construction of the First Amendment '(p)rosecutions of this character easily could degenerate into religious persecution.' 322 U.S., at 95, 64 S.Ct., at 890. The case shows how elusive is the line which enforces the Amendment's injunction of strict neutrality, while manifesting no official hostility toward religion—a line which must be considered in the cases now before us.10 Some might view the result of the Ballard case as a manifestation of hostility—in that the conviction stood because the defense could not be raised. To others it might represent merely strict adherence to the principle of neutrality already expounded in the cases involving doctrinal disputes. Inevitably, insistence upon neutrality, vital as it surely is for untrammeled religious liberty, may appear to border upon religious hostility. But in the long view the independence of both church and state in their respective spheres will be better served by close adherence to the neutrality principle. If the choice is often difficult, the difficulty is endemic to issues implicating the religious guarantees of the First Amendment. Freedom of religion will be seriously jeopardized if we admit exceptions for no better reason than the difficulty of delineating hostility from neutrality in the closest cases.
90
Second. It is only recently that our decisions have dealt with the question whether issues arising under the Establishment Clause may be isolated from problems implicating the Free Exercise Clause. Everson v. Board of Education, 330 U.S. 1, 67 S.Ct. 504, 91 L.Ed. 711, is in my view the first of our decisions which treats a problem of asserted unconstitutional involvement as raising questions purely under the Establishment Clause. A scrutiny of several earlier decisions said by some to have etched the contours of the clause shows that such cases neither raised nor decided any constitutional issues under the First Amendment. Bradfield v. Roberts, 175 U.S. 291, 20 S.Ct. 121, 44 L.Ed. 168, for example, involved challenges to a federal grant to a hospital administered by a Roman Catholic order. The Court rejected the claim for lack of evidence that any sectarian influence changed its character as a secular institution chartered as such by the Congress.11
91
Quick Bear v. Leupp, 210 U.S. 50, 28 S.Ct. 690, 52 L.Ed. 954, is also illustrative. The immediate question there was one of statutory construction, although the issue had originally involved the constitutionality of the use of federal funds to support sectarian education on Indian reservations. Congress had already prohibited federal grants for that purpose, thereby removing the broader issue, leaving only the question whether the statute authorized the appropriation for religious teaching of Treaty funds held by the Government in trust for the Indians. Since these were the Indians' own funds, the Court held only that the Indians might direct their use for such educational purposes as they chose, and that the administration by the Treasury of the disbursement of the funds did not inject into the case any issue of the propriety of the use of federal moneys.12 Indeed, the Court expressly approved the reasoning of the Court of Appeals that to deny the Indians the right to spend their own moneys for religious purposes of their choice might well infringe the free exercise of their religion: 'it seems inconceivable that Congress (should) have intended to prohibit them from receiving religious education at their own cost if they so desired it * * *.' 210 U.S., at 82, 28 S.Ct., at 700. This case forecast, however, an increasingly troublesome First Amendment paradox: that the logical interrelationship between the Establishment and Free Exercise Clauses may produce situations where an injunction against an apparent establishment must be withheld in order to avoid infringement of rights of free exercise. That paradox was not squarely presented in Quick Bear, but the care taken by the Court to avoid a constitutional confrontation discloses an awareness of possible conflicts between the two clauses. I shall come back to this problem later, infra, pp. 296—299.
92
A third case in this group is Cochran v. Louisiana State Board, 281 U.S. 370, 50 S.Ct. 335, 74 L.Ed. 913, which involved a challenge to a state statute providing public funds to support a loan of free textbooks to pupils of both public and private schools. The constitutional issues in this Court extended no further than the claim that this program amounted to a taking of private property for nonpublic use. The Court rejected the claim on the ground that no private use of property was involved; '* * * we cannot doubt that the taxing power of the State is exerted for a public purpose.' 281 U.S., at 375, 50 S.Ct., at 336. The case therefore raised no issue under the First Amendment.13
93
In Pierce v. Society of Sisters, 268 U.S. 510, 45 S.Ct. 571, 69 L.Ed. 1070, a Catholic parochial school and a private but nonsectarian military academy challenged a state law requiring all children between certain ages to attend the public schools. This Court held the law invalid as an arbitrary and unreasonable interference both with the rights of the schools and with the liberty of the parents of the children who attended them. The due process guarantee of the Fourteenth Amendment 'excludes any general power of the State to standardize its children by forcing them to accept instruction from public teachers only.' 268 U.S., at 535, 45 S.Ct., at 573. While one of the plaintiffs was indeed a parochial school, the case obviously decided no First Amendment question but recognized only the constitutional right to establish and patronize private schools—including parochial schools—which meet the state's reasonable minimum curricular requirements.
94
Third. It is true, as the Court says, that the 'two clauses (Establishment and Free Exercise) may overlap.' Because of the overlap, however, our decisions under the Free Exercise Clause bear considerable relevance to the problem now before us, and should be briefly reviewed. The early free exercise cases generally involved the objections of religious minorities to the application to them of general nonreligious legislation governing conduct. Reynolds v. United States, 98 U.S. 145, 25 L.Ed. 244, involved the claim that a belief in the sanctity of plural marriage precluded the conviction of members of a particular sect under nondiscriminatory legislation against such marriage. The Court rejected the claim, saying:
95
'Laws are made for the government of actions, and while they cannot interfere with mere religious beliefs and opinions, they may with practices. * * * Can a man excuse his practices to the contrary because of his religious belief? To permit this would be to make the professed doctrines of religious belief superior to the law of the land, and in effect to permit every citizen to become a law unto himself. Government could exist only in name under such circumstances.'14 98 U.S., at 166—167.
96
Davis v. Beason, 133 U.S. 333, 10 S.Ct. 299, 33 L.Ed. 637, similarly involved the claim that the First Amendment insulated from civil punishment certain practices inspired or motivated by religious beliefs. The claim was easily rejected: 'It was never intended or supposed that the amendment could be invoked as a protection against legislation for the punishment of acts inimical to the peace, good order, and morals of society.' 133 U.S., at 342, 10 S.Ct., at 300. See also Mormon Church v. United States, 136 U.S. 1, 10 S.Ct. 792, 34 L.Ed. 481; Jacobson v. Massachusetts, 197 U.S. 11, 25 S.Ct. 358, 49 L.Ed. 643; Prince v. Massachusetts, 321 U.S. 158, 64 U.S. 438, 88 L.Ed. 645; Cleveland v. United States, 329 U.S. 14, 67 S.Ct. 13, 91 L.Ed. 12.
97
But we must not confuse the issue of governmental power to regulate or prohibit conduct motivated by religious beliefs with the quite different problem of governmental authority to compel behavior offensive to religious principles. In Hamilton v. Regents of the University of California, 293 U.S. 245, 55 S.Ct. 197, 79 L.Ed. 343, the question was that of the power of a State to compel students at the State University to participate in military training instruction against their religious convictions. The validity of the statute was sustained against claims based upon the First Amendment. But the decision rested on a very narrow principle: since there was neither a constitutional right nor a legal obligation to attend the State University, the obligation to participate in military training courses, reflecting a legitimate state interest, might properly be imposed upon those who chose to attend. Although the rights protected by the First and Fourteenth Amendments were presumed to include 'the right to entertain the beliefs, to adhere to the principles and to teach the doctrines on which these students base their objections to the order prescribing military training,' those Amendments were construed not to free such students from the military training obligations if they chose to attend the University. Justices Brandeis, Cardozo and Stone, concurring separately, agreed that the requirement infringed no constitutionally protected liberties. They added, however, that the case presented no question under the Establishment Clause. The military instruction program was not an establishment since it in no way involved 'instruction in the practice or tenets of a religion.' 293 U.S., at 266, 55 S.Ct., at 206. Since the only question was one of free exercise, they concluded, like the majority, that the strong state interest in training a citizen militia justified the restraints imposed, at least so long as attendance at the University was voluntary.15
98
Hamilton has not been overruled, although United States v. Schwimmer, 279 U.S. 644, 49 S.Ct. 448, 73 L.Ed. 889, and United States v. Macintosh, 283 U.S. 605, 51 S.Ct. 570, 75 L.Ed. 1302, upon which the Court in Hamilton relied, have since been overruled by Girouard v. United States, 328 U.S. 61, 66 S.Ct. 826, 90 L.Ed. 1084. But if Hamilton retains any vitality with respect to higher education, we recognized its inapplicability to cognate questions in the public primary and secondary schools when we held in West Virginia Board of Education v. Barnette, supra, that a State had no power to expel from public schools students who refused on religious grounds to comply with a daily flag salute requirement. Of course, such a requirement was no more a law 'respecting an establishment of religion' than the California law compelling the college students to take military training. The Barnette plaintiffs, moreover, did not ask that the whole exercise be enjoined, but only that an excuse or exemption be provided for those students whose religious beliefs forbade them to participate in the ceremony. The key to the holding that such a requirement abridged rights of free exercise lay in the fact that attendance at school was not voluntary but compulsory. The Court said:
99
'This issue is not prejudiced by the Court's previous holding that where a State, without compelling attendance, extends college facilities to pupils who voluntarily enroll, it may prescribe military training as part of the course without offense to the Constitution. * * * Hamilton v. Regents, 293 U.S. 245, 55 S.Ct. 197, 79 L.Ed. 343. In the present case attendance is not optional.' 319 U.S., at 631—632, 63 S.Ct., at 1182.
100
The Barnette decision made another significant point. The Court held that the State must make participation in the exercise voluntary for all students and not alone for those who found participation obnoxious on religious grounds. In short, there was simply no need to 'inquire whether non-conformist beliefs will exempt from the duty to salute' because the Court found no state 'power to make the salute a legal duty.' 319 U.S., at 635, 63 S.Ct., at 1184.
101
The distinctions between Hamilton and Barnette are, I think, crucial to the resolution of the cases before us. The different results of those cases are attributable only in part to a difference in the strength of the particular state interests which the respective statutes were designed to serve. Far more significant is the fact that Hamilton dealt with the voluntary attendance at college of young adults, while Barnette involved the compelled attendance of young children at elementary and secondary schools.16 This distinction warrants a difference in constitutional results. And it is with the involuntary attendance of young school children that we are exclusively concerned in the cases now before the Court.
III.
102
No one questions that the Framers of the First Amendment intended to restrict exclusively the powers of the Federal Government.17 Whatever limitations that Amendment now imposes upon the States derive from the Fourteenth Amendment. The process of absorption of the religious guarantees of the First Amendment as protections against the States under the Fourteenth Amendment began with the Free Exercise Clause. In 1923 the Court held that the protections of the Fourteenth included at least a person's freedom 'to worship God according to the dictates of his own conscience * * *.'18
103
Meyer v. Nebraska, 262 U.S. 390, 399, 43 S.Ct. 625, 626, 67 L.Ed. 1042. See also Hamilton v. Regents, supra, 293 U.S., at 262, 55 S.Ct., at 204. Cantwell v. Connecticut, 310 U.S. 296, 60 S.Ct. 900, 84 L.Ed. 1213, completed in 1940 the process of absorption of the Free Exercise Clause and recognized its dual aspect: the Court affirmed freedom of belief as as absolute liberty, but recognized that conduct, while it may also be comprehended by the Free Exercise Clause, 'remains subject to regulation for the protection of society.' 310 U.S., at 303—304, 60 S.Ct., at 903. This was a distinction already drawn by Reynolds v. United States, supra. From the beginning this Court has recognized that while government may regulate the behavioral manifestations of religious beliefs, it may not interfere at all with the beliefs themselves.
104
The absorption of the Establishment Clause has, however, come later and by a route less easily charted. It has been suggested, with some support in history, that absorption of the First Amendment's ban against congressional legislation 'respecting an establishment of religion' is conceptually impossible because the Framers meant the Establishment Clause also to foreclose any attempt by Congress to disestablish the existing official state churches.19 Whether or not such was the understanding of the Framers and whether such a purpose would have inhibited the absorption of the Establishment Clause at the threshold of the Nineteenth Century are questions not dispositive of our present inquiry. For it is clear on the record of history that the last of the formal state establishments was dissolved more than three decades before the Fourteenth Amendment was ratified, and thus the problem of protecting official state churches from federal encroachments could hardly have been any concern of those who framed the post-Civil War Amendments.20 Any such objective of the First Amendment, having become historical anachronism by 1868, cannot be thought to have deterred the absorption of the Establishment Clause to any greater degree than it would, for example, have deterred the absorption of the Free Exercise Clause. That no organ of the Federal Government possessed in 1791 any power to restrain the interference of the States in religious matters is indisputable. See Permoli v. New Orleans, 3 How. 589, 11 L.Ed. 739. It is equally plain, on the other hand, that the Fourteenth Amendment created a panoply of new federal rights for the protection of citizens of the various States. And among those rights was freedom from such state governmental involvement in the affairs of religion as the Establishment Clause had originally foreclosed on the part of Congress.
105
It has also been suggested that the 'liberty' guaranteed by the Fourteenth Amendment logically cannot absorb the Establishment Clause because that clause is not one of the provisions of the Bill of Rights which in terms protects a 'freedom' of the individual. See Corwin, A Constitution of Powers in a Secular State (1951), 113—116. The fallacy in this contention, I think, is that it underestimates the role of the Establishment Clause as a coguarantor, with the Free Exercise Clause, of religious liberty. The Framers did not entrust the liberty of religious beliefs to either clause alone. The Free Exercise Clause 'was not to be the full extent of the Amendment's guarantee of freedom from governmental intrusion in matters of faith.' McGowan v. Maryland, supra, 366 U.S., at 464, 81 S.Ct., at 1156 (opinion of Frankfurter, J.).
106
Finally, it has been contended that absorption of the Establishment Clause is precluded by the absence of any intention on the part of the Framers of the Fourteenth Amendment to circumscribe the residual powers of the States to aid religious activities and institutions in ways which fell short of formal establishments.21 That argument relies in part upon the express terms of the abortive Blaine Amendment—proposed several years after the adoption of the Fourteenth Amendment—which would have added to the First Amendment a provision that '(n)o State shall make any law respecting an establishment of religion * * *.' Such a restriction would have been superfluous, it is said, if the Fourteenth Amendment had already made the Establishment Clause binding upon the States.
107
The argument proves too much, for the Fourteenth Amendment's protection of the free exercise of religion can hardly be questioned; yet the Blaine Amendment would also have added an explicit protection against state laws abriding that liberty.22 Even if we assume that the draftsmen of the Fourteenth Amendment saw no immediate connection between its protections against state action infringing personal liberty and the guarantees of the First Amendment, it is certainly too late in the day to suggest that their assumed inattention to the question dilutes the force of these constitutional guarantees in their application to the States.23 It is enough to conclude that the religious liberty embodied in the Fourteenth Amendment would not be viable if the Constitution were interpreted to forbid only establishments ordained by Congress.24
108
The issue of what particular activities the Establishment Clause forbids the States to undertake is our more immediate concern. In Everson v. Board of Education of Ewing Tp., 330 U.S. 1, 15—16, 67 S.Ct. 504, 91 L.Ed. 711, a careful study of the relevant history led the Court to the view, consistently recognized in decisions since Everson, that the Establishment Clause embodied the Framers' conclusion that government and religion have discreet interests which are mutually best served when each avoids too close a proximity to the other. It is not only the nonbeliever who fears the injection of sectarian doctrines and controversies into the civil polity, but in as high degree it is the devout believer who fears the secularization of a creed which becomes too deeply involved with and dependent upon the government.25 It has rightly been said of the history of the Establishment Clause that 'our tradition of civil liberty rests not only on the secularism of a Thomas Jefferson but also on the fervent sectarianism * * * of a Roger Williams.' Freund, The Supreme Court of the United States (1961), 84.
109
Our decisions on questions of religious education or exercises in the public schools have consistently reflected this dual aspect of the Establishment Clause. Engel v. Vitale unmistakably has its roots in three earlier cases which, on cognate issues, shaped the contours of the Establishment Clause. First, in Everson the Court held that reimbursement by the town of parents for the cost of transporting their children by public carrier to parochial (as well as public and private nonsectarian) schools did not offend the Establishment Clause. Such reimbursement, by easing the financial burden upon Catholic parents, may indirectly have fostered the operation of the Catholic schools, and may thereby indirectly have facilitated the teaching of Catholic principles, thus serving ultimately a religious goal. But this form of governmental assistance was difficult to distinguish from myriad other incidental if not insignificant government benefits enjoyed by religious institutions—fire and police protection, tax exemptions, and the pavement of streets and sidewalks, for example. 'The State contributes no money to the schools. It does not support them. Its legislation, as applied, does no more than provide a general program to help parents get their children, regardless of their religion, safely and expeditiously to and from accredited schools.' 330 U.S., at 18, 67 S.Ct. at 513. Yet even this form of assistance was thought by four Justices of the Everson Court to be barred by the Establishment Clause because too perilously close to that public support of religion forbidden by the First Amendment.
110
The other two cases, Illinois ex rel. McCollum v. Board of Education, 333 U.S. 203, 68 S.Ct. 461, 92 L.Ed. 648, and Zorach v. Clauson, 343 U.S. 306, 72 S.Ct. 679, 96 L.Ed. 954, can best be considered together. Both involved programs of released time for religious instruction of public school students. I reject the suggestion that Zorach overruled McCollum in silence.26 The distinction which the Court drew in Zorach between the two cases is, in my view, faithful to the function of the Establishment Clause.
111
I should first note, however, that McCollum and Zorach do not seem to me distinguishable in terms of the free exercise claims advanced in both cases.27 The nonparticipant in the McCollum program was given secular instruction in a separate room during the times his classmates had religious lessons; the nonparticipant in any Zorach program also received secular instruction, while his classmates repaired to a place outside the school for religious instruction.
112
The crucial difference, I think, was that the McCollum program offended the Establishment Clause while the Zorach program did not. This was not, in my view, because of the difference in public expenditures involved. True, the McCollum program involved the regular use of school facilities, classrooms, heat and light and time from the regular school day—even though the actual incremental cost may have been negligible. All religious instruction under the Zorach program, by contrast, was carried on entirely off the school premises, and the teacher's part was simply to facilitate the children's release to the churches. The deeper difference was that the McCollum program placed the religious instructor in the public school classroom in precisely the position of authority held by the regular teachers of secular subjects, while the Zorach program did not.28 The McCollum program, in lending to the support of sectarian instruction all the authority of the governmentally operated public school system, brought government and religion into that proximity which the Establishment Clause forbids. To be sure, a religious teacher presumably commands substantial respect and merits attention in his own right. But the Constitution does not permit that prestige and capacity for influence to be augmented by investiture of all the symbols of authority at the command of the lay teacher for the enhancement of secular instruction.
113
More recent decisions have further etched the contours of Establishment. In the Sunday Law Cases, we found in state laws compelling a uniform day of rest from worldly labor no violation of the Establishment Clause (McGowan v. Maryland, 366 U.S. 420, 81 S.Ct. 1101, 6 L.Ed.2d 393). The basic ground of our decision was that, granted the Sunday Laws were first enacted for religious ends, they were continued in force for reasons wholly secular, namely, to provide a universal day of rest and ensure the health and tranquillity of the community. In other words, government may originally have decreed a Sunday day of rest for the impermissible purpose of supporting religion but abandoned that purpose and retained the laws for the permissible purpose of furthering overwhelmingly secular ends.
114
Such was the evolution of the contours of the Establishment Clause before Engel v. Vitale. There, a year ago, we held that the daily recital of the state-composed Regents' Prayer constituted an establishment of religion because, although the prayer itself revealed no sectarian content or purpose, its nature and meaning were quite clearly religious. New York, in authorizing its recitation, had not maintained that distance between the public and the religious sectors commanded by the Establishment Clause when it placed the 'power, prestige and financial support of government' behind the prayer. In Engel, as in McCollum, it did not matter that the amount of time and expense allocated to the daily recitation was small so long as the exercise itself was manifestly religious. Nor did it matter that few children had complained of the practice, for the measure of the seriousness of a breach of the Establishment Clause has never been thought to be the number of people who complain of it.
115
We also held two Terms ago in Torcaso v. Watkins, supra, that a State may not constitutionally require an applicant for the office of Notary Public to swear or affirm that he believes in God. The problem of that case was strikingly similar to the issue presented 18 years before in the flag salute case, West Virginia Board of Education v. Barnette, supra. In neither case was there any claim of establishment of religion, but only of infringement of the individual's religious liberty—in the one case, that of the nonbeliever who could not attest to a belief in God; in the other, that of the child whose creed forbade him to salute the flag. But Torcaso added a new element not present in Barnette. The Maryland test oath involved an attempt to employ essentially religious (albeit nonsectarian) means to achieve a secular goal to which the means bore no reasonable relationship. No one doubted the State's interest in the integrity of its Notaries Public, but that interest did not warrant the screening of applicants by means of a religious test. The Sunday Law Cases were different in that respect. Even if Sunday Laws retain certain religious vestiges, they are enforced today for essentially secular objectives which cannot be effectively achieved in modern society except by designating Sunday as the universal day of rest. The Court's opinions cited very substantial problems in selecting or enforcing an alternative day of rest. But the teaching of both Torcaso and the Sunday Law Cases is that government may not employ religious means to serve secular interests, however legitimate they may be, at least without the clearest demonstration that nonreligious means will not suffice.29
IV.
116
I turn now to the cases before us.30 The religious nature of the exercises here challenged seems plain. Unless Engel v. Vitale is to be overruled, or we are to engage in wholly disingenuous distinction, we cannot sustain these practices. Daily recital of the Lord's Prayer and the reading of passages of Scripture are quite as clearly breaches of the command of the Establishment Clause as was the daily use of the rather bland Regents' Prayer in the New York public schools. Indeed, I would suppose that, if anything, the Lord's Prayer and the Holy Bible are more clearly sectarian, and the present violations of the First Amendment consequently more serious. But the religious exercises challenged in these cases have a long history. And almost from the beginning, Bible reading and daily prayer in the schools have been the subject of debate, criticism by educators and other public officials and proscription by courts and legislative councils. At the outset, then, we must carefully canvass both aspects of this history.
117
The use of prayers and Bible readings at the opening of the school day long antedates the founding of our Republic. The Rules of the New Haven Hopkins Grammar School required in 1684 '(t)hat the Scholars being called together, the Mr. shall every morning begin his work with a short prayer for a blessing on his Laboures and their learning * * *.'31 More rigorous was the provision in a 1682 contract with a Dutch schoolmaster in Flatbush, New York:
118
'When the school begins, one of the children shall read the morning prayer, as it stands in the catechism, and close with the prayer before dinner; in the afternoon it shall begin with the prayer after dinner, and end with the evening prayer. The evening school shall begin with the Lord's prayer, and close by singing a psalm.'32
119
After the Revolution, the new States uniformly continued these long-established practices in the private and the few public grammar schools. The school committee of Boston in 1789, for example, required the city's several schoolmasters 'daily to commence the duties of their office by prayer and reading a portion of the Sacred Scriptures * * *.'33 That requirement was mirrored throughout the original States, and exemplified the universal practice well into the nineteenth century. As the free public schools gradually supplanted the private academies and sectarian schools between 1800 and 1850, morning devotional exercises were retained with few alterations. Indeed, public pressures upon school administrators in many parts of the country would hardly have condoned abandonment of practices to which a century or more of private religious education had accustomed the American people.34 The controversy centered, in fact, principally about the elimination of plainly sectarian practices and textbooks, and led to the eventual substitution of nonsectarian, though still religious, exercises and materials.35
120
Statutory provision for daily religious exercises is, however, of quite recent origin. At the turn of this century, there was but one State—Massachusetts—which had a law making morning prayer or Bible reading obligatory. Statutes elsewhere either permitted such practices or simply left the question to local option. It was not until after 1910 that 11 more States, within a few years joined Massachusetts in making one or both exercises compulsory.36 The Pennsylvania law with which we are concerned in the Schempp case, for example, took effect in 1913; and even the Rule of the Baltimore School Board involved in the Murray case dates only from 1905. In no State has there ever been a constitutional or statutory prohibition against the recital of prayers or the reading of Scripture, although a number of States have outlawed these practices by judicial decision or administrative order. What is noteworthy about the panoply of state and local regulations from which these cases emerge is the relative recency of the statutory codification of practices which have ancient roots, and the rather small number of States which have ever prescribed compulsory religious exercises in the public schools.
121
The purposes underlying the adoption and perpetuation of these practices are somewhat complex. It is beyond question that the religious benefits and values realized from daily prayer and Bible reading have usually been considered paramount, and sufficient to justify the continuation of such practices. To Horace Mann, embroiled in an intense controversy over the role of sectarian instruction and texbooks in the Boston public schools, there was little question that the regular use of the Bible—which he thought essentially nonsectarian—would bear fruit in the spiritual enlightenment of his pupils.37 A contemporary of Mann's the Commissioner of Education of a neighboring State, expressed a view which many enlightened educators of that day shared:
122
'As a textbook of morals the Bible is pre-eminent, and should have a prominent place in our schools, either as a reading book or as a source of appeal and instruction. Sectarianism, indeed, should not be countenanced in the schools; but the Bible is not sectarian * * *. The Scriptures should at least be read at the opening of the school, if no more. Prayer may also be offered with the happiest effects.'38
123
Wisconsin's Superintendent of Public Instruction, writing a few years later in 1858, reflected the attitude of his eastern colleagues, in that he regarded 'with special favor the use of the Bible in public schools, as pre-eminently first in importance among text-books for teaching the noblest principles of virtue, morality, patriotism, and good order—love and reverence for God charity and good will to man.'39
124
Such statements reveal the understanding of educators that the daily religious exercises in the schools served broader goals than compelling formal worship of God or fostering church attendance. The religious aims of the educators who adopted and retained such exercises were comprehensive, and in many cases quite devoid of sectarian bias—but the crucial fact is that they were nonetheless religious. While it has been suggested, see pp. 278—281, infra, that daily prayer and reading of Scripture now serve secular goals as well, there can be no doubt that the origins of these practices were unambiguously religious, even where the educator's aim was not to win adherents to a particular creed or faith.
125
Almost from the beginning religious exercises in the public schools have been the subject of intense criticism, vigorous debate, and judicial or administrative prohibition. Significantly, educators and school boards early entertained doubts about both the legality and the soundness of opening the school day with compulsory prayer or Bible reading. Particularly in the large Eastern cities, where immigration had exposed the public schools to religious diversities and conflicts unknown to the homogeneous academies of the eighteenth century, local authorities found it necessary, even before the Civil War to seek an accommodation. In 1843, the Philadelphia School Board adopted the following resolutions:
126
'RESOLVED, that no children be required to attend or unite in the reading of the Bible in the Public Schools, whose parents are conscientiously opposed thereto:
127
'RESOLVED, that those children whose parents conscientiously prefer and desire any particular version of the Bible, without note or comment, be furnished with same.'40
128
A decade later, the Superintendent of Schools of New York State issued an even bolder decree that prayers could no longer be required as part of public school activities, and that where the King James Bible was read, Catholic students could not be compelled to attend.41 This type of accommodation was not restricted to the East Coast; the Cincinnati Board of Education resolved in 1869 that 'religious instruction and the reading of religious books, including the Holy Bible, are prohibited in the common schools of Cincinnati, it being the true object and intent of this rule to allow the children of the parents of all sects and opinions, in matters of faith and worship, to enjoy alike the benefit of the common-school fund.'42 The Board repealed at the same time an earlier regulation which had required the singing of hymns and psalms to accompany the Bible reading at the start of the school day. And in 1889, one commentator ventured the view that '(t)here is not enough to be gained from Bible reading to justify the quarrel that has been raised over it.'43
129
Thus a great deal of controversy over religion in the public schools had preceded the debate over the Blaine Amendment, precipitated by President Grant's insistence that matters of religion should be left 'to the family altar, the church, and the private school, supported entirely by private contributions.'44 There was ample precedent, too, for Theodore Roosevelt's declaration that in the interest of 'absolutely nonsectarian public schools' it was 'not our business to have the Protestant Bible or the Catholic Vulgate or the Talmud read in those schools.'45 The same principle appeared in the message of an Ohio Governor who vetoed a compulsory Bible-reading bill in 1925:
130
'It is my belief that religious teaching in our homes, Sunday schools, churches, by the good mothers, fathers, and ministers of Ohio is far preferable to compulsory teaching of religion by the state. The spirit of our federal and state constitutions from the beginning * * * (has) been to leave religious instruction to the discretion of parents.'46
131
The same theme has recurred in the opinions of the Attorneys General of several States holding religious exercises or instruction to be in violation of the state or federal constitutional command of separation of church and state.47 Thus the basic principle upon which our decision last year in Engel v. Vitale necessarily rested, and which we reaffirm today, can hardly be thought to be radical or novel.
132
Particularly relevant for our purposes are the decisions of the state courts on questions of religion in the public schools. Those decisions, while not, of course, authoritative in this Court, serve nevertheless to define the problem before us and to guide our inquiry. With the growth of religious diversity and the rise of vigorous dissent it was inevitable that the courts would be called upon to enjoin religious practices in the public schools which offended certain sects and groups. The earliest of such decisions declined to review the propriety of actions taken by school authorities, so long as those actions were within the purview of the administrators' powers.48 Thus, where the local school board required religious exercises, the courts would not enjoin them;49 and where, as in at least one case, the school officials forbade devotional practices, the court refused on similar grounds to overrule that decision.50 Thus, whichever way the early cases came up, the governing principle of nearly complete deference to administrative discretion effectively foreclosed any consideration of constitutional questions.
133
The last quarter of the nineteenth century found the courts beginning to question the constitutionality of public school religious exercises. The legal context was still, of course, that of the state constitutions, since the First Amendment had not yet been held applicable to state action. And the state constitutional prohibitions against church-state cooperation or governmental aid to religion were generally less rigorous than the Establishment Clause of the First Amendment. It is therefore remarkable that the courts of a half dozen States found compulsory religious exercises in the public schools in violation of their respective state constitutions.51 These courts attributed much significance to the clearly religious origins and content of the challenged practices, and to the impossibility of avoiding sectarian controversy in their conduct. The Illinois Supreme Court expressed in 1910 the principles which characterized these decisions:
134
'The public school is supported by the texes which each citizen, regardless of his religion or his lack of it, is compelled to pay. The school, like the government, is simply a civil institution. It is secular, and not religious, in its purposes. The truths of the Bible are the truths of religion, which do not come within the province of the public school. * * * No one denies that they should be taught to the youth of the State. The constitution and the law do not interfere with such teaching, but they do banish theological polemics from the schools and the school districts. This is done, not from any hostility to religion, but because it is no part of the duty of the State to teach religion,—to take the money of all and apply it to teaching the children of all the religion of a part, only. Instruction in religion must be voluntary.' People ex rel. Ring v. Board of Education of Dist. No. 24, 245 Ill. 334, 349, 92 N.E. 251, 256 (1910).
135
The Supreme Court of South Dakota, in banning devotional exercises from the public schools of that State, also cautioned that '(t)he state as an educator must keep out of this field, and especially is this true in the common schools, where the child is immature, without fixed religious convictions * * *.' State ex rel. Finger v. Weedman, 55 S.D. 343, 357, 226 N.W. 348, 354 (1929).
136
Even those state courts which have sustained devotional exercises under state law52 have usually recognized the primarily religious character of prayers and Bible readings. If such practices were not for that reason unconstitutional, it was necessarily because the state constitution forbade only public expenditures for sectarian instruction, or for activities which made the schoolhouse a 'place of worship,' but said nothing about the subtler question of laws 'respecting an establishment of religion.'53 Thus the panorama of history permits no other conclusion than that daily prayers and Bible readings in the public schools have always been designed to be, and have been regarded as, essentially religious exercises. Unlike the Sunday closing laws, these exercises appear neither to have been divorced from their religious origins nor deprived of their centrally religious character by the passage of time.54 cf. McGowan v. Maryland, supra, 366 U.S. at 442—445, 81 S.Ct. at 1113—1115. On this distinction alone we might well rest a constitutional decision. But three further contentions have been pressed in the argument of these cases. These contentions deserve careful consideration, for if the position of the school authorities were correct in respect to any of them, we would be misapplying the principles of Engel v. Vitale.
A.
137
First, it is argued that however clearly religious may have been the origins and early nature of daily prayer and Bible reading, these practices today serve so clearly secular educational purposes that their religious attributes may be overlooked. I do not doubt, for example, that morning devotional exercises may foster better discipline in the classroom, and elevate the spiritual level on which the school day opens. The Pennsylvania Superintendent of Public Instruction, testifying by deposition in the Schempp case, offered his view that daily Bible reading 'places upon the children or those hearing the reading of this, and the atmosphere which goes on in the reading * * * one of the last vestiges of moral value that we have left in our school system.' The exercise thus affords, the Superintendent concluded, 'a strong contradiction to the materialistic trends of our time.' Baltimore's Superintendent of Schools expressed a similar view of the practices challenged in the Murray case, to the effect that '(t)he acknowledgement of the existence of God as symbolized in the opening exercises establishes a discipline tone which tends to cause each individual pupil to constrain his overt acts and to consequently conform to accepted standards of behavior during his attendance at school.' These views are by no means novel, see, e.g., Billard v. Board of Education, 69 Kan. 53, 57—58, 76 P. 422, 423, 66 L.R.A. 166 (1904).55
138
It is not the business of this Court to gainsay the judgments of experts on matters of pedagogy. Such decisions must be left to the discretion of those administrators charged with the supervision of the Nation's public schools. The limited province of the courts is to determine whether the means which the educators have chosen to achieve legitimate pedagogical ends infringe the constitutional freedoms of the First Amendment. The secular purposes which devotional exercises are said to serve fall into two categories—those which depend upon an immediately religious experience shared by the participating children; and those which appear sufficiently divorced from the religious content of the devotional material that they can be served equally by nonreligious materials. With respect to the first objective, much has been written about the moral and spiritual values of infusing some religious influence or instruction into the public school classroom.56 To the extent that only religious materials will serve this purpose, it seems to me that the purpose as well as the means is so plainly religious that the exercise is necessarily forbidden by the Establishment Clause. The fact that purely secular benefits may eventually result does not seem to me to justify the exercises, for similar indirect nonreligious benefits could no doubt have been claimed for the released time program invalidated in McCollum.
139
The second justification assumes that religious exercises at the start of the school day may directly serve solely secular ends for example, by fostering harmony and tolerance among the pupils, enhancing the authority of the teacher, and inspiring better discipline. To the extent that such benefits result not from the content of the readings and recitation, but simply from the holding of such a solemn exercise at the opening assembly or the first class of the day, it would seem that less sensitive materials might equally well serve the same purpose. I have previously suggested that Torcaso and the Sunday Law Cases forbid the use of religious means to achieve secular ends where nonreligious means will suffice. That principle is readily applied to these cases. It has not been shown that readings from the speeches and messages of great Americans, for example, or from the documents of our heritage of liberty, daily recitation of the Pledge of Allegiance, or even the observance of a moment of reverent silence at the opening of class, may not adequately serve the solely secular purposes of the devotional activities without jeopardizing either the religious liberties of any members of the community or the proper degree of separation between the spheres of religion and government.57 Such substitutes would, I think, be unsatisfactory or inadequate only to the extent that the present activities do in fact serve religious goals. While I do not question the judgment of experienced educators that the challenged practices may well achieve valuable secular ends, it seems to me that the State acts unconstitutionally if it either sets about to attain even indirectly religious ends by religious means, or if it uses religious means to serve secular ends where secular means would suffice.
B.
140
Second, it is argued that the particular practices involved in the two cases before us are unobjectionable because they prefer no particular sect or sects at the expense of others. Both the Baltimore and Abington procedures permit, for example, the reading of any of several versions of the Bible, and this flexibility is said to ensure neutrality sufficiently to avoid the constitutional prohibition. One answer, which might be dispositive, is that any version of the Bible is inherently sectarian, else there would be no need to offer a system of rotation or alternation of versions in the first place, that is, to allow different sectarian versions to be used on different days. The sectarian character of the Holy Bible has been at the core of the whole controversy over religious practices in the public schools throughout its long and often bitter history.58 To vary the version as the Abington and Baltimore schools have done may well be less offensive than to read from the King James version every day, as once was the practice. But the result even of this relatively benign procedure is that majority sects are preferred in approximate proportion to their representation in the community and in the student body, while the smaller sects suffer commensurate discrimination. So long as the subject matter of the exercise is sectarian in character, these consequences cannot be avoided.
141
The argument contains, however, a more basic flaw. There are persons in every community—often deeply devout—to whom any version of the Judaeo-Christian Bible is offensive.59 There are others whose reverence for the Holy Scriptures demands private study or reflection and to whom public reading or recitation is sacrilegious, as one of the expert witnesses at the trial of the Schempp case explained. To such persons it is not the fact of using the Bible in the public schools, nor the content of any particular version, that is offensive, but only the manner in which it is used.60 For such persons, the anathema of public communion is even more pronounced when prayer is involved. Many deeply devout persons have always regarded prayer as a necessarily private experience.61 One Protestant group recently commented, for example: 'When one thinks of prayer as sincere outreach of a human soul to the Creator, 'required prayer' becomes an absurdity.'62 There is a similar problem with respect to comment upon the passages of Scripture which are to be read. Most present statutes forbid comment, and this practice accords with the views of many religious groups as to the manner in which the Bible should be read. However, as a recent survey discloses, scriptural passages read without comment frequently convey no message to the younger children in the school. Thus there has developed a practice in some schools of bridging the gap between faith and understanding by means of 'definitions,' even where 'comment' is forbidden by statute.63 The present practice therefore poses a difficult dilemma: While Bible reading is almost universally required to be without comment, since only by such a prohibition can sectarian interpretation be excluded from the classroom, the rule breaks down at the point at which rudimentary definitions of Biblical terms are necessary for comprehension if the exercise is to be meaningful at all.
142
It has been suggested that a tentative solution to these problems may lie in the fashioning of a 'common core' of theology tolerable to all creeds but preferential to none.64 But as one commentator has recently observed, '(h) istory is not encouraging to' those who hope to fashion a 'common denominator of religion detached from its manifestation in any organized church.' Sutherland, Establishment According to Engel, 76 Harv.L.Rev. 25, 51 (1962). Thus, the notion of a 'common core' litany or supplication offends many deeply devout worshippers who do not find clearly sectarian practices objectionable.65 Father Gustave Weigel has recently expressed a widely shared view: 'The moral code held by each separate religious community can reductively be unified, but the consistent particular believer wants no such reduction.'66 And, as the American Council on Education warned several years ago, 'The notion of a common core suggests a watering down of the several faiths to the point where common essentials appear. This might easily lead to a new sect—a public school seet—which would take its place alongside the existing faiths and compete with them.'67 Engel is surely authority that nonsectarian religious practices, equally with sectarian exercises, violate the Establishment Clause. Moreover, even if the Establishment Clause were oblivious to nonsectarian religious practices, I think it quite likely that the 'common core' approach would be sufficiently objectionable to many groups to be foreclosed by the prohibitions of the Free Exercise Clause.
C.
143
A third element which is said to absolve the practices involved in these cases from the ban of the religious guarantees of the Constitution is the provision to excuse or exempt students who wish not to participate. Insofar as these practices are claimed to violate the Establishment Clause, I find the answer which the District Court gave after our remand of Schempp to be altogether dispositive:
144
'The fact that some pupils, or theoretically all pupils, might be excused from attendance at the exercises does not mitigate the obligatory nature of the ceremony * * *. The exercises are held in the school buildings and perforce are conducted by and under the authority of the local school authorities and during school sessions. Since the statute requires the reading of the 'Holy Bible', a Christian document, the practice, as we said in our first opinion, prefers the Christian religion. The record demonstrates that it was the intention of the General Assembly of the Commonwealth of Pennsylvania to introduce a religious ceremony into the public schools of the Commonwealth.' 201 F.Supp., at 819.
145
Thus the short, and to me sufficient, answer is that the availability of excusal or exemption simply has no relevance to the establishment question, if it is once found that these practices are essentially religious exercises designed at least in part to achieve religious aims through the use of public school facilities during the school day.
146
The more difficult question, however, is whether the availability of excusal for the dissenting child serves to refute challenges to these practices under the Free Exercise Clause. While it is enough to decide these cases to dispose of the establishment questions, questions of free exercise are so inextricably interwoven into the history and present status of these practices as to justify disposition of this second aspect of the excusal issue. The answer is that the excusal procedure itself necessarily operates in such a way as to infringe the rights of free exercise of those children who wish to be excused. We have held in Barnette and Torcaso, respectively, that a State may require neither public school students nor candidates for an office of public trust to profess beliefs offensive to religious principles. By the same token the State could not constitutionally require a student to profess publicly his disbelief as the prerequisite to the exercise of his constitutional right of abstention. And apart from Torcaso and Barnette, I think Speiser v. Randall, 357 U.S. 513, 78 S.Ct. 1332, 2 L.Ed.2d 1460, suggests a further answer. We held there that a State may not condition the grant of a tax exemption upon the willingness of those entitled to the exemption to affirm their loyalty to the Government, even though the exemption was itself a matter of grace rather than of constitutional right. We concluded that to impose upon the eligible taxpayers the affirmative burden of proving their loyalty impermissibly jeopardized the freedom to engage in constitutionally protected activities close to the area to which the loyalty oath related. Speiser v. Randall seems to me to dispose of two aspects of the excusal or exemption procedure now before us. First, by requiring what is tantamount in the eyes of teachers and schoolmates to a profession of disbelief, or at least of nonconformity, the procedure may well deter those children who do not wish to participate for any reason based upon the dictates of conscience from exercising an indisputably constitutional right to be excused.68 Thus the excusal provision in its operation subjects them to a cruel dilemma. In consequence, even devout children may well avoid claiming their right and simply continue to participate in exercises distasteful to them because of an understandable reluctance to be stigmatized as atheists or nonconformists simply on the basis of their request.
147
Such reluctance to seek exemption seems all the more likely in view of the fact that children are disinclined at this age to step out of line or to flout 'peergroup norms.' Such is the widely held view of experts who have studied the behaviors and attitudes of children.69 This is also the basis of Mr. Justice Frankfurter's answer to a similar contention made in the McCollum case:
148
'That a child is offered an alternative may reduce the constraint; it does not eliminate the operation of influence by the school in matters sacred to conscience and outside the school's domain. The law of imitation operates, and non-conformity is not an outstanding characteristic of children. The result is an obvious pressure upon children to attend.' 333 U.S., at 227, 68 S.Ct., at 473.
149
Also apposite is the answer given more than 70 years ago by the Supreme Court of Wisconsin to the argument that an excusal provision saved a public school devotional exercise from constitutional invalidation:
150
'* * * the excluded pupil loses caste with his fellows, and is liable to be regarded with aversion, and subjected to reproach and insult. But it is a sufficient refutation of the argument that the practice in question tends to destroy the equality of the pupils which the constitution seeks to establish and protect, and puts a portion of them to serious disadvantage in many ways with respect to the others.' State ex rel. Weiss v. District Board of School District No. 8, 76 Wis. 177, 200, 44 N.W. 967, 975, 7 L.R.A. 330.
151
And 50 years ago a like answer was offered by the Louisiana Supreme Court:
152
'Under such circumstances, the children would be excused from the opening exercises * * * because of their religious beliefs. And excusing such children on religious grounds, although the number excused might be very small, would be a distinct preference in favor of the religious beliefs to the majority, and would work a discrimination against those who were excused. The exclusion of a pupil under such circumstances puts him in a class by himself; it subjects him to a religious stigma; and all because of his religious belief. Equality in public education would be destroyed by such act, under a Constitution which seeks to establish equality and freedom in religious matters.' Herold v. Parish Board of School Directors, 136 La. 1034, 1049—1050, 68 So. 116, 121, L.R.A.1915D, 941. See also Tudor v. Board of Education, 14 N.J. 31, 48—52, 100 A.2d 857, 867—868, 45 A.L.R.2d 729; Brown v. Orange County Board of Public Instruction, 128 So.2d 181, 185 (Fla.App.).
153
Speiser v. Randall also suggests the answer to a further argument based on the excusal procedure. It has been suggested by the School Board, in Schempp, that we ought not pass upon the appellees' constitutional challenge at least until the children have availed themselves of the excusal procedure and found it inadequate to redress their grievances. Were the right to be excused not itself of constitutional stature, I might have some doubt about this issue. But we held in Speiser that the constitutional vice of the loyalty oath procedure discharged any obligation to seek the exemption before challenging the constitutionality of the conditions upon which it might have been denied. 357 U.S., at 529, 78 S.Ct., at 1343. Similarly, we have held that one need not apply for a permit to distribute constitutionally protected literature, Lovell v. Griffin, 303 U.S. 444, 58 S.Ct. 666, 82 L.Ed. 949, or to deliver a speech, Thomas v. Collins, 323 U.S. 516, 65 S.Ct. 315, 89 L.Ed. 430, before he may attack the constitutionality of a licensing system of which the defect is patent. Insofar as these cases implicate only questions of establishment, it seems to me that the availability of an excuse is constitutionally irrelevant. Moreover, the excusal procedure seems to me to operate in such a way as to discourage the free exercise of religion on the part of those who might wish to utilize it, thereby rendering it unconstitutional in an additional and quite distinct respect.
154
To summarize my views concerning the merits of these two cases: The history, the purpose and the operation of the daily prayer recital and Bible reading leave no doubt that these practices standing by themselves constitute an impermissible breach of the Establishment Clause. Such devotional exercises may well serve legitimate nonreligious purposes. To the extent, however, that such purposes are really without religious significance, it has never been demonstrated that secular means would not suffice. Indeed, I would suggest that patriotic or other nonreligious materials might provide adequate substitutes—inadequate only to the extent that the purposes now served are indeed directly or indirectly religious. Under such circumstances, the States may not employ religious means to reach a secular goal unless secular means are wholly unavailing. I therefore agree with the Court that the judgment in Schempp, No. 142, must be affirmed, and that in Murray, No. 119, must be reversed.
V.
155
These considerations bring me to a final contention of the school officials in these cases: that the invalidation of the exercises at bar permits this Court no alternative but to declare unconstitutional every vestige, however slight, of cooperation or accommodation between religion and government. I cannot accept that contention. While it is not, of course, appropriate for this Court to decide questions not presently before it, I venture to suggest that religious exercises in the public schools present a unique problem. For not every involvement of religion in public life violates the Establishment Clause. Our decision in these cases does not clearly forecast anything about the constitutionality of other types of interdependence between religious and other public institutions.
156
Specifically, I believe that the line we must draw between the permissible and the impermissible is one which accords with history and faithfully reflects the understanding of the Founding Fathers. It is a line which the Court has consistently sought to mark in its decisions expounding the religious guarantees of the First Amendment. What the Framers meant to foreclose, and what our decisions under the Establishment Clause have forbidden, are those involvements of religious with secular institutions which (a) serve the essentially religious activities of religious institutions; (b) employ the organs of government for essentially religious purposes; or (c) use essentially religious means to serve governmental ends, where secular means would suffice. When the secular and religious institutions become involved in such a manner, there inhere in the relationship precisely those dangers—as much to church as to state—which the Framers feared would subvert religious liberty and the strength of a system of secular government. On the other hand, there may be myriad forms of involvements of government with religion which do not import such dangers and therefore should not, in my judgment, be deemed to violate the Establishment Clause. Nothing in the Constitution compels the organs of government to be blind to what everyone else perceives—that religious differences among Americans have important and pervasive implications for our society. Likewise nothing in the Establishment Clause forbids the application of legislation having purely secular ends in such a way as to alleviate burdens upon the free exercise of an individual's religious beliefs. Surely the Framers would never have understood that such a construction sanctions that involvement which violates the Establishment Clause. Such a conclusion can be reached, I would suggest, only by using the words of the First Amendment to defeat its very purpose.
157
The line between permissible and impermissible forms of involvement between government and religion has already been considered by the lower federal and state courts. I think a brief survey of certain of these forms of accommodation will reveal that the First Amendment commands not official hostility toward religion, but only a strict neutrality in matters of religion. Moreover, it may serve to suggest that the scope of our holding today is to be measured by the special circumstances under which these cases have arisen, and by the particular dangers to church and state which religious exercises in the public schools present. It may be helpful for purposes of analysis to group these other practices and forms of accommodation into several rough categories.
158
A. The Conflict Between Establishment and Free Exercise. There are certain practices, conceivably violative of the Establishment Clause, the striking down of which might seriously interfere with certain religious liberties also protected by the First Amendment.70 Provisions for churches and chaplains at military establishments for those in the armed services may afford one such example.71 The like provision by state and federal governments for chaplains in penal institutions may afford another example.72 It is argued that such provisions may be assumed to contravene the Establishment Clause, yet be sustained on constitutional grounds as necessary to secure to the members of the Armed Forces and prisoners those rights of worship guaranteed under the Free Exercise Clause. Since government has deprived such persons of the opportunity to practice their faith at places of their choice, the argument runs, government may, in order to avoid infringing the free exercise guarantees, provide substitutes where it requires such persons to be. Such a principle might support, for example, the constitutionality of draft exemptions for ministers and divinity students,73 cf. Selective Draft Law Cases (Arver v. United States), 245 U.S. 366, 389—390, 38 S.Ct. 159, 165, 62 L.Ed. 349; of the excusal of children from school on their respective religious holidays; and of the allowance by government of temporary use of public buildings by religious organizations when their own churches have become unavailable because of a disaster or emergency.74
159
Such activities and practices seem distinguishable from the sponsorship of daily Bible reading and prayer recital. For one thing, there is no element of coercion present in the appointment of military or prison chaplains; the soldier or convict who declines the opportunities for worship would not ordinarily subject himself to the suspicion or obloquy of his peers. Of special significance to this distinction is the fact that we are here usually dealing with adults, not with impressionable children as in the public schools. Moreover, the school exercises are not designed to provide the pupils with general opportunities for worship denied them by the legal obligation to attend school. The student's compelled presence in school for five days a week in no way renders the regular religious facilities of the community less accessible to him than they are to others. The situation of the school child is therefore plainly unlike that of the isolated soldier or the prisoner.
160
The State must be steadfastly neutral in all matters of faith, and neither favor nor inhibit religion. In my view, government cannot sponsor religious exercises in the public schools without jeopardizing that neutrality. On the other hand, hostility, not neutrality, would characterize the refusal to provide chaplains and places of worship for prisoners and soldiers cut off by the State from all civilian opportunities for public communion, the withholding of draft exemptions for ministers and conscientious objectors, or the denial of the temporary use of an empty public building to a congregation whose place of worship has been destroyed by fire or flood. I do not say that government must provide chaplains or draft exemptions, or that the courts should intercede if it fails to do so.
161
B. Establishment and Exercises in Legislative Bodies.—The saying of invocational prayers in legislative chambers, state or federal, and the appointment of legislative chaplains, might well represent no involvements of the kind prohibited by the Establishment Clause.75 Legislators, federal and state, are mature adults who may presumably absent themselves from such public and ceremonial exercises without incurring any penalty, direct or indirect. It may also be significant that, at least in the case of the Congress, Art. I, § 5, of the Constitution makes each House the monitor of the 'Rules of its Proceedings' so that it is at least arguable whether such matters present 'political questions' the resolution of which is exclusively confided to Congress. See Baker v. Carr, 369 U.S. 186, 232, 82 S.Ct. 691, 718, 7 L.Ed.2d 663. Finally, there is the difficult question of who may be heard to challenge such practices. See Elliott v. White, 57 App.D.C. 389, 23 F.2d 997.
162
C. Non-Devotional Use of the Bible In the Public Schools.—The holding of the Court today plainly does not foreclose teaching about the Holy Scriptures or about the differences between religious sects in classes in literature or history. Indeed, whether or not the Bible is involved, it would be impossible to teach meaningfully many subjects in the social sciences or the humanities without some mention of religion.76 To what extent, and at what points in the curriculum, religious materials should be cited are matters which the courts ought to entrust very largely to the experienced officials who superintend our Nation's public schools. They are experts in such matters, and we are not. We should heed Mr. Justice Jackson's caveat that any attempt by this Court to announce curricular standards would be 'to decree a uniform, rigid and, if we are consistent, an unchanging standard for countless school boards representing and serving highly localized groups which not only differ from each other but which themselves from time to time change attitudes.' Illinois ex rel. McCollum v. Board of Education, supra, at 237 of 333 U.S., at 478 of 68 S.Ct.
163
We do not, however, in my view usurp the jurisdiction of school administrators by holding as we do today that morning devotional exercises in any form are constitutionally invalid. But there is no occasion now to go further and anticipate problems we cannot judge with the material now before us. Any attempt to impose rigid limits upon the mention of God or references to the Bible in the classroom would be fraught with dangers. If it should sometime hereafter be shown that in fact religion can play no part in the teaching of a given subject without resurrecting the ghost of the practices we strike down today, it will then be time enough to consider questions we must now defer.
164
D. Uniform Tax Exemptions Incidentally Available to Religious Institutions.—Nothing we hold today questions the propriety of certain tax deductions or exemptions which incidentally benefit churches and religious institutions, along with many secular charities and nonprofit organizations. If religious institutions benefit, it is in spite of rather than because of their religious character. For religious institutions simply share benefits which government makes generally available to educational, charitable, and eleemosynary groups.77 There is no indication that taxing authorities have used such benefits in any way to subsidize worship or foster belief in God. And as among religious beneficiaries, the tax exemption or deduction can be truly nondiscriminatory, available on equal terms to small as well as large religious bodies, to popular and unpopular sects, and to those organizations which reject as well as those which accept a belief in God.78
165
E. Religious Considerations in Public Welfare Programs.—Since government may not support or directly aid religious activities without violating the Establishment Clause, there might be some doubt whether nondiscriminatory programs of governmental aid may constitutionally include individuals who become eligible wholly or partially for religious reasons. For example, it might be suggested that where a State provides unemployment compensation generally to those who are unable to find suitable work, it may not extend such benefits to persons who are unemployed by reason of religious beliefs or practices without thereby establishing the religion to which those persons belong. Therefore, the argument runs, the State may avoid an establishment only by singling out and excluding such persons on the ground that religious beliefs or practices have made them potential beneficiaries. Such a construction would, it seems to me, require government to impose religious discriminations and disabilities, thereby jeopardizing the free exercise of religion, in order to avoid what is thought to constitute an establishment.
166
The inescapable flaw in the argument, I suggest, is its quite unrealistic view of the aims of the Establishment Clause. The Framers were not concerned with the effects of certain incidental aids to individual worshippers which come about as by-products of general and nondiscriminatory welfare programs. If such benefits serve to make easier or less expensive the practice of a particular creed, or of all religions, it can hardly be said that the purpose of the program is in any way religious, or that the consequence of its nondiscriminatory application is to create the forbidden degree of interdependence between secular and sectarian institutions. I cannot therefore accept the suggestion, which seems to me implicit in the argument outlined here, that every judicial or administrative construction which is designed to prevent a public welfare program from abridging the free exercise of religious beliefs, is for that reason ipso facto an establishment of religion.
167
F. Activities Which, Though Religious in Origin, Have Ceased to Have Religious Meaning.—As we noted in our Sunday Law decisions, nearly every criminal law on the books can be traced to some religious principle or inspiration. But that does not make the present enforcement of the criminal law in any sense an establishment of religion, simply because it accords with widely held religious principles. As we said in McGowan v. Maryland, 366 U.S. 420, 442, 81 S.Ct. 1101, 1113, 6 L.Ed.2d 393, 'the 'Establishment' Clause does not ban federal or state regulation of conduct whose reason or effect merely happens to coincide or harmonize with the tenets of some or all religions.' This rationale suggests that the use of the motto 'In God We Trust' on currency, on documents and public buildings and the like may not offend the clause. It is not that the use of those four words can be dismissed as 'de minimis'—for I suspect there would be intense opposition to the abandonment of that motto. The truth is that we have simply interwoven the motto so deeply into the fabric of our civil polity that its present use may well not present that type of involvement which the First Amendment prohibits.
168
This general principle might also serve to insulate the various patriotic exercises and activities used in the public schools and elsewhere which, whatever may have been their origins, no longer have a religious purpose or meaning. The reference to divinity in the revised pledge of allegiance, for example, may merely recognize the historical fact that our Nation was believed to have been founded 'under God.' Thus reciting the pledge may be no more of a religious exercise than the reading aloud of Lincoln's Gettysburg Address, which contains an allusion to the same historical fact.
169
The principles which we reaffirm and apply today can hardly be thought novel or radical. They are, in truth, as old as the Republic itself, and have always been as integral a part of the First Amendment as the very words of that charter of religious liberty. No less applicable today than they were when first pronounced a century ago, one year after the very first court decision involving religious exercises in the public schools, are the words of a distinguished Chief Justice of the Commonwealth of Pennsylvania, Jeremiah S. Black:
170
'The manifest object of the men who framed the institutions of this country, was to have a State without religion, and a Church without politics—that is to say, they meant that one should never be used as an engine for any purpose of the other, and that no man's rights in one should be tested by his opinions about the other. As the Church takes no note of men's political differences, so the State looks with equal eye on all the modes of religious faith. * * * Our fathers seem to have been perfectly sincere in their belief that the members of the Church would be more patriotic, and the citizens of the State more religious, by keeping their respective functions entirely separate.' Essay on Religious Liberty, in Black, ed., Essays and Speeches of Jeremiah S. Black (1866), 53.
171
Mr. Justice GOLDBERG, with whom Mr. Justice HARLAN joins, concurring.
172
As is apparent from the opinions filed today, delineation of the constitutionally permissible relationship between religion and government is a most difficult and sensitive task, calling for the careful exercise of both judicial and public judgment and restraint. The considerations which lead the Court today to interdict the clearly religious practices presented in these cases are to me wholly compelling; I have no doubt as to the propriety of the decision and therefore join the opinion and judgment of the Court. The singular sensitivity and concern which surround both the legal and practical judgments involved impel me, however, to add a few words in further explication, while at the same time avoiding repetition of the carefully and ably framed examination of history and authority by my Brethren.
173
The First Amendment's guarantees, as applied to the States through the Fourteenth Amendment, foreclose not only laws 'respecting an establishment of religion' but also those 'prohibiting the free exercise thereof.' These two proscriptions are to be read together, and in light of the single end which they are designed to serve. The basic purpose of the religion clause of the First Amendment is to promote and assure the fullest possible scope of religious liberty and tolerance for all and to nurture the conditions which secure the best hope of attainment of that end.
174
The fullest realization of true religious liberty requires that government neither engage in nor compel religious practices, that it effect no favoritism among sects or between religion and nonreligion, and that it work deterrence of no religious belief. But devotion even to these simply stated objectives presents no easy course, for the unavoidable accommodations necessary to achieve the maximum enjoyment of each and all of them are often difficult of discernment. There is for me no simple and clear measure which by precise application can readily and invariably demark the permissible from the impermissible.
175
It is said, and I agree, that the attitude of government toward religion must be one of neutrality. But untutored devotion to the concept of neutrality can lead to invocation or approval of results which partake not simply of that noninterference and noninvolvement with the religious which the Constitution commands, but of a brooding and pervasive devotion to the secular and a passive, or even active, hostility to the religious. Such results are not only not compelled by the Constitution, but, it seems to me, are prohibited by it.
176
Neither government nor this Court can or should ignore the significance of the fact that a vast portion of our people believe in and worship God and that many of our legal, political and personal values derive historically from religious teachings. Government must inevitably take cognizance of the existence of religion and, indeed, under certain circumstances the First Amendment may require that it do so. And it seems clear to me from the opinions in the present and past cases that the Court would recognize the propriety of providing military chaplains and of the teaching about religion, as distinguished from the teaching of religion, in the public schools. The examples could readily be multiplied, for both the required and the permissible accommodations between state and church frame the relation as one free of hostility or favor and productive of religious and political harmony, but without undue involvement of one in the concerns or practices of the other. To be sure, the judgment in each case is a delicate one, but it must be made if we are to do loyal service as judges to the ultimate First Amendment objective of religious liberty.
177
The practices here involved do not fall within any sensible or acceptable concept of compelled or permitted accommodation and involve the state so significantly and directly in the realm of the sectarian as to give rise to those very divisive influences and inhibitions of freedom which both religion clauses of the First Amendment preclude. The state has ordained and has utilized its facilities to engage in unmistakably religious exercises—the devotional reading and recitation of the Holy Bible—in a manner having substantial and significant import and impact. That it has selected, rather than written, a particular devotional liturgy seems to me without constitutional import. The pervasive religiosity and direct governmental involvement inhering in the prescription of prayer and Bible reading in the public schools, during and as part of the curricular day, involving young impressionable children whose school attendance is statutorily compelled, and utilizing the prestige, power, and infiuence of school administration, staff, and authority, cannot realistically be termed simply accommodation, and must fall within the interdiction of the First Amendment. I find nothing in the opinion of the Court which says more than this. And, of course, today's decision does not mean that all incidents of government which import of the religious are therefore and without more banned by the strictures of the Establishment Clause. As the Court declared only last Term in Engel v. Vitale, 370 U.S. 421, 435, n. 21, 82 S.Ct. 1261, 1269, 8 L.Ed.2d 601:
178
'There is of course nothing in the decision reached here that is inconsistent with the fact that school children and others are officially encouraged to express love for our country by reciting historical documents such as the Declaration of Independence which contain references to the Deity or by singing officially espoused anthems which imclude the composer's professions of faith in a Supreme Being, or with the fact that there are many manifestations in our public life of belief in God. Such patriotic or ceremonial occasions bear no true resemblance to the unquestioned religious exercise that the State * * * has sponsored in this instance.'
179
The First Amendment does not prohibit practices which by any realistic measure create none of the dangers which it is designed to prevent and which do not so directly or substantially involve the state in religious exercises or in the favoring of religion as to have meaningful and practical impact. It is of course true that great consequences can grow from small beginnings, but the measure of constitutional adjudication is the ability and willingness to distinguish between real threat and mere shadow.
180
Mr. Justice STEWART, dissenting.
181
I think the records in the two cases before us are so fundamentally deficient as to make impossible an informed or responsible determination of the constitutional issues presented. Specifically, I cannot agree that on these records we can say that the Establishment Clause has necessarily been violated.1 But I think there exist serious questions under both that provision and the Free Exercise Clause—insofar as each is imbedded in the Fourteenth Amendment—which require the remand of these cases for the taking of additional evidence.
I.
182
The First Amendment declares that 'Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof * * *.' It is, I think, a fallacious oversimplification to regard these two provisions as establishing a single constitutional standard of 'separation of church and state,' which can be mechanically applied in every case to delineate the required boundaries between government and religion. We err in the first place if we do not recognize, as a matter of history and as a matter of the imperatives of our free society, that religion and government must necessarily interact in countless ways. Secondly, the fact is that while in many contexts the Establishment Clause and the Free Exercise Clause fully complement each other, there are areas in which a doctrinaire reading of the Establishment Clause leads to irreconcilable conflict with the Free Exercise Clause.
183
A single obvious example should suffice to make the point. Spending federal funds to employ chaplains for the armed forces might be said to violate the Establishment Clause. Yet a lonely soldier stationed at some far-away outpost could surely complain that a government which did not provide him the opportunity for pastoral guidance was affirmatively prohibiting the free exercise of his religion. And such examples could readily be multiplied. The short of the matter is simply that the two relevant clauses of the First Amendment cannot accurately be reflected in a sterile metaphor which by its very nature may distort rather than illumine the problems involved in a particular case. Cf. Sherbert v. Verner, 374 U.S. 398, 83 S.Ct. 1790.
II.
184
As a matter of history, the First Amendment was adopted solely as a limitation upon the newly created National Government. The events leading to its adoption strongly suggest that the Establishment Clause was primarily an attempt to insure that Congress not only would be powerless to establish a national church, but would also be unable to interfere with existing state establishments. See McGowan v. Maryland, 366 U.S. 420, 440—441, 81 S.Ct. 1101, 1112—1113, 6 L.Ed.2d 393. Each State was left free to go its own way and pursue its own policy with respect to religion. Thus Virginia from the beginning pursued a policy of disestablishmentarianism. Massachusetts, by contrast, had an established church until well into the nineteenth century.
185
So matters stood until the adoption of the Fourteenth Amendment, or more accurately, until this Court's decision in Cantwell v. Connecticut, in 1940. 310 U.S. 296, 60 S.Ct. 900, 84 L.Ed. 1213. In that case the Court said: 'The First Amendment declares that Congress shall make no law respecting an establishment of religion or prohibiting the free exercise thereof. The Fourteenth Amendment has rendered the legislatures of the states as incompetent as Congress to enact such laws.'2
186
I accept without question that the liberty guaranteed by the Fourteenth Amendment against impairment by the States embraces in full the right of free exercise of religion protected by the First Amendment, and I yield to no one in my conception of the breadth of that freedom. See Braunfeld v. Brown, 366 U.S. 599, 616, 81 S.Ct. 1144, 1152, 6 L.Ed.2d 563 (dissenting opinion). I accept too the proposition that the Fourteenth Amendment has somehow absorbed the Establishment Clause, although it is not without irony that a constitutional provision evidently designed to leave the States free to go their own way should now have become a restriction upon their autonomy. But I cannot agree with what seems to me the insensitive definition of the Establishment Clause contained in the Court's opinion, nor with the different but, I think, equally mechanistic definitions contained in the separate opinions which have been filed.
III.
187
Since the Cantwell pronouncement in 1940, this Court has only twice held invalid state laws on the ground that they were laws 'respecting an establishment of religion' in violation of the Fourteenth Amendment. Illinois ex rel. McCollum v. Board of Education, 333 U.S. 203, 68 S.Ct. 461, 92 L.Ed. 649; Engel v. Vitale, 370 U.S. 421, 82 S.Ct. 1261, 8 L.Ed.2d 601. On the other hand, the Court has upheld against such a challenge laws establishing Sunday as a compulsory day of rest, McGowan v. Maryland, 366 U.S. 420, 81 S.Ct. 1101, 6 L.Ed.2d 393, and a law authorizing reimbursement from public funds for the transportation of parochial school pupils. Everson v. Board of Education, 330 U.S. 1, 67 S.Ct. 504, 91 L.Ed. 711.
188
Unlike other First Amendment guarantees, there is an inherent limitation upon the applicability of the Establishment Clause's ban on state support to religion. That limitation was succinctly put in Everson v. Board of Education, 330 U.S. 1, 18, 67 S.Ct. 504, 513, 91 L.Ed. 711: 'State power is no more to be used so as to handicap religions, than it is to favor them.'3 And in a later case, this Court recognized that the limitation was one which was itself compelled by the free exercise guarantee. 'To hold that a state cannot consistently with the First and Fourteenth Amendments utilize its public school system to aid any or all religious faiths or sects in the dissemination of their doctrines and ideals does not * * * manifest a governmental hostility to religion or religious teachings. A manifestation of such hostility would be at war with our national tradition as embodied in the First Amendment's guaranty of the free exercise of religion.' Illinois ex rel. McCollum v. Board of Education, 333 U.S. 203, 211—212, 68 S.Ct. 461, 465, 92 L.Ed. 649.
189
That the central value embodied in the First Amendment—and, more particularly, in the guarantee of 'liberty' contained in the Fourteenth—is the safeguarding of an individual's right to free exercise of his religion has been consistently recognized. Thus, in the case of Hamilton v. Regents, 293 U.S. 245, 265, 55 S.Ct. 197, 205, 79 L.Ed. 343, Mr. Justice Cardozo, concurring, assumed that it was '* * * the religious liberty protected by the First Amendment against invasion by the nation (which) is protected by the Fourteenth Amendment against invasion by the states.' (Emphasis added.) And in Cantwell v. Connecticut, supra, the purpose of those guarantees was described in the following terms: 'On the one hand, it forestalls compulsion by law of the acceptance of any creed or the practice of any form of worship. Freedom of conscience and freedom to adhere to such religious organization or form of worship as the individual may choose cannot be restricted by law. On the other hand, it safeguards the free exercise of the closen form of religion.' 310 U.S., at 303, 60 S.Ct., at 903, 84 L.Ed. 1213.
190
It is this concept of constitutional protection embodied in our decisions which makes the cases before us such difficult ones for me. For there is involved in these cases a substantial free exercise claim on the part of those who affirmatively desire to have their children's school day open with the reading of passages from the Bible.
191
It has become accepted that the decision in Pierce v. Society of Sisters, 268 U.S. 510, 45 S.Ct. 571, 69 L.Ed. 1070, upholding the right of parents to send their children to nonpublic schools, was ultimately based upon the recognition of the validity of the free exercise claim involved in that situation. It might be argued here that parents who wanted their children to be exposed to religious influences in school could, under Pierce, send their children to private or parochial schools. But the consideration which renders this contention too facile to be determinative has already been recognized by the Court: 'Freedom of speech, freedom of the press, freedom of religion are available to all, not merely to those who can pay their own way.' Murdock v. Commonwealth of Pennslyvania, 319 U.S. 105, 111, 63 S.Ct. 870, 874, 87 L.Ed. 1292.
192
It might also be argued that parents who want their children exposed to religious influences can adequately fulfill that wish off school property and outside school time. With all its surface persuasiveness, however, this argument seriously misconceives the basic constitutional justification for permitting the exercises at issue in these cases. For a compulsory state educational system so structures a child's life that if religious exercises are held to be an impermissible activity in schools, religion is placed at an artificial and state-created disadvantage. Viewed in this light, permission of such exercises for those who want them is necessary if the schools are truly to be neutral in the matter of religion. And a refusal to permit religious exercises thus is seen, not as the realization of state neutrality, but rather as the establishment of a religion of secularism, or at the least, as government support of the beliefs of those who think that religious exercises should be conducted only in private.
193
What seems to me to be of paramount importance, then, is recognition of the fact that the claim advanced here in favor of Bible reading is sufficiently substantial to make simple reference to the constitutional phrase 'establishment of religion' as inadequate an analysis of the cases before us as the ritualistic invocation of the nonconstitutional phrase 'separation of church and state.' What these cases compel, rather, is an analysis of just what the 'neutrality' is which is required by the interplay of the Establishment and Free Exercise Clauses of the First Amendment, as imbedded in the Fourteenth.
IV.
194
Our decisions make clear that there is no constitutional bar to the use of government property for religious purposes. On the contrary, this Court has consistently held that the discriminatory barring of religious groups from public property is itself a violation of First and Fourteenth Amendment guarantees. Fowler v. Rhode Island, 345 U.S. 67, 73 S.Ct. 526, 97 L.Ed. 828; Niemotko v. Maryland, 340 U.S. 268, 71 S.Ct. 325, 95 L.Ed. 267. A different standard has been applied to public school property, because of the coercive effect which the use by religious sects of a compulsory school system would necessarily have upon the children involved. Illinois ex rel. McCollum v. Board of Education, 333 U.S. 203, 68 S.Ct. 461, 92 L.Ed. 649. But insofar as the McCollum decision rests on the Establishment rather than the Free Exercise Clause, it is clear that its effect is limited to religious instruction—to government support of proselytizing activities of religious sects by throwing the weight of secular authority behind the dissemination of religious tenets.4
195
The dangers both to government and to religion inherent in official support of instruction in the tenets of various religious sects are absent in the present cases, which involve only a reading from the Bible unaccompanied by comments which might otherwise constitute instruction. Indeed, since, from all that appears in either record, any teacher who does not wish to do so is free not to participate,5 it cannot even be contended that some infinitesimal part of the salaries paid by the State are made contingent upon the performance of a religious function.
196
In the absence of evidence that the legislature or school board intended to prohibit local schools from substituting a different set of readings where parents requested such a change, we should not assume that the provisions before us—as actually administered—may not be construed simply as authorizing religious exercises, nor that the designations may not be treated simply as indications of the promulgating body's view as to the community's preference. We are under a duty to interpret these provisions so as to render them constitutional if reasonably possible. Compare Two Guys From Harrison-Allentown, Inc. v. McGinley, 366 U.S. 582, 592—595, 81 S.Ct. 1135, 1140—1142, 6 L.Ed.2d 551; Everson v. Board of Education, 330 U.S. 1, 4, and n. 2, 67 S.Ct. 504, 505, 506, 91 L.Ed. 711. In the Schempp case there is evidence which indicates that variations were in fact permitted by the very school there involved, and that further variations were not introduced only because of the absence of requests from parents. And in the Murray case the Baltimore rule itself contains a provision permitting another version of the Bible to be substituted for the King James version.
197
If the provisions are not so construed, I think that their validity under the Establishment Clause would be extremely doubtful, because of the designation of a particular religious book and a denominational prayer. But since, even if the provisions are construed as I believe they must be, I think that the cases before us must be remanded for further evidence on other issues—thus affording the plaintiffs an opportunity to prove that local variations are not in fact permitted—I shall for the balance of this dissenting opinion treat the provisions before us as making the variety and content of the exercises, as well as a choice as to their implementation, matters which ultimately reflect the consensus of each local school community. In the absence of coercion upon those who do not wish to participate because they hold less strong beliefs, other beliefs, or no beliefs at all—such provisions cannot, in my view, be held to represent the type of support of religion barred by the Establishment Clause. For the only support which such rules provide for religion is the withholding of state hostility—a simple acknowledgment on the part of secular authorities that the Constitution does not require extirpation of all expression of religious belief.
V.
198
I have said that these provisions authorizing religious exercises are properly to be regarded as measures making possible the free exercise of religion. But it is important to stress that, strictly speaking, what is at issue here is a privilege rather than a right. In other words, the question presented is not whether exercises such as those at issue here are constitutionally compelled, but rather whether they are constitutionally invalid. And that issue, in my view, turns on the question of coercion.
199
It is clear that the dangers of coercion involved in the holding of religious exercises in a schoolroom differ qualitatively from those presented by the use of similar exercises or affirmations in ceremonies attended by adults. Even as to children, however, the duty laid upon government in connection with religious exercises in the public schools is that of refraining from so structuring the school environment as to put any kind of pressure on a child to participate in those exercises; it is not that of providing an atmosphere in which children are kept scrupulously insulated from any awareness that some of their fellows may want to open the school day with prayer, or of the fact that there exist in our pluralistic society differences of religious belief.
200
These are not, it must be stressed, cases like Brown v. Board of Education, 347 U.S. 483, 74 S.Ct. 686, 98 L.Ed. 873, in which this Court held that, in the sphere of public education, the Fourteenth Amendment's guarantee of equal protection of the laws required that race not be treated as a relevant factor. A segregated school system is not invalid because its operation is coercive; it is invalid simply because our Constitution presupposes that men are created equal, and that therefore racial differences cannot provide a valid basis for governmental action. Accommodation of religious differences on the part of the State, however, is not only permitted but required by that same Constitution.
201
The governmental neutrality which the First and Fourteenth Amendments require in the cases before us, in other words, is the extension of evehhanded treatment to all who believe, doubt, or disbelieve—a refusal on the part of the State to weight the scales of private choice. In these cases, therefore, what is involved is not state action based on impermissible categories, but rather an attempt by the State to accommodate those differences which the existence in our society of a variety of religious beliefs makes inevitable. The Constitution requires that such efforts be struck down only if they are proven to entail the use of the secular authority of government to coerce a preference among such beliefs.
202
It may well be, as has been argued to us, that even the supposed benefits to be derived from noncoercive religious exercises in public schools are incommensurate with the administrative problems which they would create. The choice involved, however, is one for each local community and its school board, and not for this Court. For, as I have said, religious exercises are not constitutionally invalid if they simply reflect differences which exist in the society from which the school draws its pupils. They become constitutionally invalid only if their administration places the sanction of secular authority behind one or more particular religious or irreligious beliefs.
203
To be specific, it seems to me clear that certain types of exercises would present situations in which no possibility of coercion on the part of secular officials could be claimed to exist. Thus, if such exercises were held either before or after the official school day, or if the school schedule were such that participation were merely one among a number of desirable alternatives,6 it could hardly be contended that the exercises did anything more than to provide an opportunity for the voluntary expression of religious belief. On the other hand, a law which provided for religious exercises during the school day and which contained no excusal provision would obviously be unconstitutionally coercive upon those who did not wish to participate. And even under a law containing an excusal provision, if the exercises where held during the school day, and no equally desirable alternative were provided by the school authorities, the likelihood that children might be under at least some psychological compulsion to participate would be great. In a case such as the latter, however, I think we would err if we assumed such coercion in the absence of any evidence.7
VI.
204
Viewed in this light, it seems to me clear that the records in both of the cases before us are wholly inadequate to support an informed or responsible decision. Both cases involve provisions which explicitly permit any student who wishes, to be excused from participation in the exercises. There is no evidence in either case as to whether there would exist any coercion of any kind upon a student who did not want to participate. No evidence at all was adduced in the Murray case, because it was decided upon a demurrer. All that we have in that case, therefore, is the conclusory language of a pleading. While such conclusory allegations are acceptable for procedural purposes, I think that the nature of the constitutional problem involved here clearly demands that no decision be made except upon evidence. In the Schempp case the record shows no more than a subjective prophecy by a parent of what he thought would happen if a request were made to be excused from participation in the exercises under the amended statute. No such request was ever made, and there is no evidence whatever as to what might or would actually happen, nor of what administrative arrangements the school actually might or could make to free from pressure of any kind those who do not want to participate in the exercises. There were no District Court findings on this issue, since the case under the amended statute was decided exclusively on Establishment Clause grounds. 201 F.Supp. 815.
205
What our Constitution indispensably protects is the freedom of each of us, be he Jew or Agnostic, Christian or Atheist, Buddhist or Freethinker, to believe or disbelieve, to worship or not worship, to pray or keep silent, according to his own conscience, uncoerced and unrestrained by government. It is conceivable that these school boards, or even all school boards, might eventually find it impossible to administer a system of religious exercises during school hours in such a way as to meet this constitutional standard—in such a way as completely to free from any kind of official coercion those who do not affirmatively want to participate.8 But I think we must not assume that school boards so lack the qualities of inventiveness and good will as to make impossible the achievement of that goal.
206
I would remand both cases for further hearing.
1
The action was brought in 1958, prior to the 1959 amendment of § 15—1516 authorizing a child's nonattendance at the exercises upon parental request. The three-judge court held the statute and the practices complained of unconstitutional under both the Establishment Clause and the Free Exercise Clause. D.C., 177 F.Supp. 398. Pending appeal to this Court by the school district, the statute was so amended, and we vacated the judgment and remanded for further proceedings. 364 U.S. 298, 81 S.Ct. 268, 5 L.Ed.2d 89. The same three-judge court granted appellees' motion to amend the pleadings, D.C., 195 F.Supp. 518, held a hearing on the amended pleadings and rendered the judgment, D.C., 201 F.Supp. 815, from which appeal is now taken.
2
The statute as amended imposes no penalty upon a teacher refusing to obey its mandate. However, it remains to be seen whether one refusing could have his contract of employment terminated for 'wilful violation of the school laws.' 24 Pa.Stat. (Supp.1960) § 11—1122.
3
The trial court summarized his testimony as follows:
'Edward Schempp, the children's father, testified that after careful consideration he had decided that he should not have Roger or Donna excused from attendance at these morning ceremonies. Among his reasons were the following. He said that he thought his children would be 'labeled as 'odd balls" before their teachers and classmates every school day; that children, like Roger's and Donna's classmates, were liable 'to lump all particular religious difference(s) or religious objections (together) as 'atheism" and that today the word 'atheism' is often connected with 'atheistic communism', and has 'very bad' connotations, such as 'un-American' or 'anti-Red', with overtones of possible immorality. Mr. Schempp pointed out that due to the events of the morning exercises following in rapid succession, the Bible reading, the Lord's Prayer, the Flag Salute, and the announcements, excusing his children from the Bible reading would mean that probably they would miss hearing the announcements so important to children. He testified also that if Roger and Donna were excused from Bible reading they would have to stand in the hall outside their 'homeroom' and that this carried with it the imputation of punishment for bad conduct.' 201 F.Supp., at 818.
4
The rule as amended provides as follows:
'Opening Exercises. Each school, either collectively or in classes, shall be opened by the reading, without comment, of a chapter in the Holy Bible and/or the use of the Lord's Prayer. The Douay version may be used by those pupils who prefer it. Appropriate patriotic exercises should be held as a part of the general opening exercise of the school or class. Any child shall be excused from participating in the opening exercises or from attending the opening exercises upon the written request of his parent or guardian.'
5
There were established churches in at least eight of the original colonies, and various degrees of religious support in others as late as the Revolutionary War. See Engel v. Vitale, supra, 370 U.S. at 428, n. 10, 82 S.Ct., at 1265, 8 L.Ed.2d 601.
6
'There goes many a ship to sea, with many hundred souls in one ship, whose weal and woe is common, and is a true picture of a commonwealth, or human combination, or society. It hath fallen out sometimes, that both Papists and Protestants, Jews and Turks, may be embarked in one ship; upon which supposal, I affirm that all the liberty of conscience I ever pleaded for, turns upon these two hinges, that none of the Papists, Protestants, Jews, or Turks be forced to come to the ship's prayers or worship, nor compelled from their own particular prayers or worship, if they practice any.'
7
Superior Court of Cincinnati, February 1870. The opinion is not reported but is published under the title, The Bible in the Common Schools (Cincinnati: Robert Clarke & Co. 1870). Judge Taft's views, expressed in dissent, prevailed on appeal. See Board of Education of Cincinnati v. Minor, 23 Ohio St. 211, 253 (1872), in which the Ohio Supreme Court held that:
'The great bulk of human affairs and human interests is left by any free government to individual enterprise and individual action. Religion is eminently one of these interests, lying outside the true and legitimate province of government.'
8
Application to the States of other clauses of the First Amendment obtained even before Cantwell. Almost 40 years ago in the opinion of the Court in Gitlow v. People of State of New York, 268 U.S. 652, 666, 45 S.Ct. 625, 630, 69 L.Ed. 1138 (1925), Mr. Justice Sanford said: 'For present purposes we may and do assume that freedom of speech and of the press—which are protected by the First Amendment from abridgment by Congress—are among the fundamental personal rights and 'liberties' protected by the due process clause of the Fourteenth Amendment from impairment by the States.'
9
It goes without saying that the laws and practices involved here can be challenged only by persons having standing to complain. But the requirements for standing to challenge state action under the Establishment Clause, unlike those relating to the Free Exercise Clause, do not include proof that particular religious freedoms are infringed. McGowan v. Maryland, supra, 366 U.S., at 429—430, 81 S.Ct., at 1106—1107, 6 L.Ed.2d 393. The parties here are school children and their parents, who are directly affected by the laws and practices against which their complaints are directed. These interests surely suffice to give the parties standing to complain. See Engel v. Vitale, supra. Cf. McCollum v. Board of Education, surpa; Everson v. Board of Education, supra. Compare Doremus v. Board of Education, 342 U.S. 429, 72 S.Ct. 394, 96 L.Ed. 475 (1952), which involved the same substantive issues presented here. The appeal was there dismissed upon the graduation of the school child involved and because of the appellants' failure to establish standing as taxpayers.
10
We are not of course presented with and therefore do not pass upon a situation such as military service, where the Government regulates the temporal and geographic environment of individuals to a point that, unless it permits voluntary religious services to be conducted with the use of government facilities, military personnel would be unable to engage in the practice of their faiths.
1
See Bates, Religious Liberty: An Inquiry (1945), 9—14, 239 252; Cobb, Religious Liberty in America (1902), 1—2, cc. IV, V; Gledhill, Pakistan, The Development of its Laws and Constitution (8 British Commonwealth, 1957), 11—15; Keller, Church and State on the European Continent (1936), c. 2; Pfeffer, Church, State, and Freedom (1953), c. 2; I Stokes, Church and State in the United States (1950), 151—169.
2
See III Stokes, op. cit., supra, n. 1, 42—67; Bates, op. cit., supra, n. 1, 9—11, 58—59, 98, 245; Gledhill, op. cit., supra, n. 1, 128, 192, 205, 208; Rackman, Israel's Emerging Constitution (1955), 120—134; Drinan, Religious Freedom in Israel, America (Apr. 6, 1963), 456—457.
3
See II Stokes, op. cit., supra, n. 1, 488—548; Boles, The Bible, Religion, and the Public Schools (2d ed. 1963), 4—10; Rackman, op. cit., supra, n. 2, at 136—141; O'Brien, The Engel Case From A Swiss Perspective, 61 Mich.L.Rev. 1069; Freund, Muslim Education in West Pakistan, 56 Religious Education 31.
4
Bates, op. cit., supra, n. 1, at 18; Pfeffer, op. cit., supra, n. 1, at 28—31; Thomas, The Balance of Forces in Spain, 41 Foreign Affairs 208, 210.
5
Cobb, op. cit., supra, n. 1, at 2.
6
See II Stokes, op. cit., supra, n. 1, at 681—695.
7
See Accountants' Handbook (4th ed. 1956) 4.8—4.15.
1
Locke, A Letter Concerning Toleration, in 35 Great Books of the Western World (Hutchins ed. 1952), 2.
2
Representative Daniel Carroll of Maryland during debate upon the proposed Bill of Rights in the First Congress, August 15, 1789, I Annals of Cong. 730.
3
See Healey, Jefferson on Religion in Public Education (1962); Boles, The Bible, Religion, and the Public Schools (1961), 16—21; Butts, The American Tradition in Religion and Education (1950), 119—130; Cahn, On Government and Prayer, 37 N.Y.U.L.Rev. 981 (1962); Costanzo, Thomas Jefferson, Religious Education and Public Law, 8 J.Pub.Law 81 (1959); Comment, The Supreme Court, the First Amendment, and Religion in the Public Schools, 63 Col.L.Rev. 73, 79—83 (1963).
4
Jefferson's caveat was in full:
'Instead, therefore, of putting the Bible and Testament into the hands of the children at an age when their judgments are not sufficiently matured for religious inquiries, their memories may here be stored with the most useful facts from Grecian, Roman, European and American history.' 2 Writings of Thomas Jefferson (Memorial ed. 1903), 204.
Compare Jefferson's letter to his nephew, Peter Carr, when the latter was about to begin the study of law, in which Jefferson outlined a suggested course of private study of religion since '(y)our reason is now mature enough to examine this object.' Letter to Peter Carr, August 10, 1787, in Padover, The Complete Jefferson (1943), 1058. Jefferson seems to have opposed sectarian instruction at any level of public education, see Healey, Jefferson on Religion in Public Education (1962), 206—210, 256, 264—265. The absence of any mention of religious instruction in the projected elementary and secondary schools contrasts significantly with Jefferson's quite explicit proposals concerning religious instruction at the University of Virginia. His draft for 'A Bill for the More General Diffusion of Knowledge' in 1779, for example, outlined in some detail the secular curriculum for the public schools, while avoiding any references to religious studies. See Padover, supra, at 1048—1054. The later draft of an 'Act for Establishing Elementary Schools' which Jefferson submitted to the Virginia General Assembly in 1817 provided that 'no religious reading, instruction or exercise, shall be prescribed or practiced inconsistent with the tenets of any religious sect or denomination.' Padover, supra, at 1076. Reliance upon Jefferson's apparent willingness to permit certain religious instruction at the University seems, therefore, to lend little support to such instruction in the elementary and secondary schools. Compare, e.g., Corwin, A Constitution of Powers in a Secular State (1951), 104—106; Costanzo, Thomas Jefferson, Religious Education and Public Law, 8 J.Pub.Law 81, 100—106 (1959).
5
Cf. Mr. Justice Butledge's observations in Everson v. Board of Education, 330 U.S. 1, 53—54, 67 S.Ct. 504, 529—530, 91 L.Ed. 711 (dissenting opinion). See also Fellman, Separation of Church and State in the United States: A Summary View, 1950 Wis.L.Rev. 427, 428—429; Rosenfield, Separation of Church and State in the Public Schools, 22 U. of Pitt.L.Rev. 561, 569 (1961); MacKinnon, Freedom?—or Toleration? The problem of Church and State in the United States, (1959) Pub.Law 374. One author has suggested these reasons for cautious application of the history of the constitution's religious guarantees to contemporary problems:
'First, the brevity of Congressional debate and the lack of writings on the question by the framers make any historical argument inconclusive and open to serious question. Second, the amendment was designed to outlaw practices which had existed before its writing, but there is no authoritative declaration of the specific practices at which it was aimed. And third, most of the modern religious-freedom cases turn on issues which were at most academic in 1789 and perhaps did not exist at all. Public education was almost nonexistent in 1789, and the question of religious education in public schools may not have been foreseen.' Beth, The American Theory of Church and State (1958), 88.
6
See generally, for discussion of the early efforts for disestablishment of the established colonial churches, and of the conditions against which the proponents of separation of church and state contended, Sweet, The Story of Religion in America (1950), c. XIII; Cobb, The Rise of Religious Liberty in America (1902), c. IX; Eckenrode, Separation of Church and State in Virginia (1910); Brant, James Madison—The Nationalist, 1780—1787 (1948), c. XXII; Bowers, The Young Jefferson (1945), 193—199; Butts, The American Tradition in Religion and Education (1950), c. II; Kruse, The Historical Meaning and Judicial Construction of the Establishment of Religion Clause of the First Amendment, 2 Washburn L.J. 65, 79—83 (1962). Compare also Alexander Hamilton's conception of 'the characteristic difference between a tolerated and established religion' and his grounds of opposition to the latter, in his remarks on the Quebec Bill in 1775, 2 Works of Alexander Hamilton (Hamilton ed. 1850), 133—138. Compare, for the view that contemporary evidence reveals a design of the Framers to forbid not only formal establishment of churches, but various forms of incidental aid to or support of religion, Lardner, How Far Does the Constitution Separate Church and State? 45 Am.Pol.Sci.Rev. 110, 112—115 (1951).
7
The origins of the modern movement for free state-supported education cannot be fixed with precision. In England, the Levellers unavailingly urged in their platform of 1649 the establishment of free primary education for all, or at least for boys. See Brailsford, The Levellers and the English Revolution (1961), 534. In the North American Colonies, education was almost without exception under private sponsorship and supervision, frequently under control of the dominant Protestant sects. This condition prevailed after the Revolution and into the first quarter of the nineteenth century. See generally Mason, Moral Values and Secular Education (1950), c. II; Thayer, The Role of the School in American Society (1960), c. X; Greene, Religion and the State: The Making and Testing of an American Tradition (1941), 120—122. Thus, Virginia's colonial Governor Berkeley exclaimed in 1671: 'I thank God there are no free schools nor printing, and I hope we shall not have them these hundred years; for learning has brought disobedience, and heresy, and sects into the world * * *.' (Emphasis deleted.) Bates, Religious Liberty: An Inquiry (1945), 327.
The exclusively private control of American education did not, however, quite survive Berkeley's expectations. Benjamin Franklin's proposals in 1749 for a Philadelphia Academy heralded the dawn of publicly supported secondary education, although the proposal did not bear immediate fruit. See Johnson and Yost, Separation of Church and State in the United States (1948), 26—27. Jefferson's elaborate plans for a public school system in Virginia came to naught after the defeat in 1796 of his proposed Elementary School Bill, which found little favor among the wealthier legislators. See Bowers, The
Young Jefferson (1945), 182—186. It was not until the 1820's and 1830's, under the impetus of Jacksonian democracy, that a system of public education really took root in the United States. See 1 Beard, The Rise of American Civilization (1937), 810—818. One force behind the development of secular public schools may have been a growing dissatisfaction with the tightly sectarian control over private education, see Harner, Religion's Place in General Education (1949), 29—30. Yet the burgeoning public school systems did not immediately supplant the old sectarian and private institutions; Alexis de Tocqueville, for example, remarked after his tour of the Eastern States in 1831 that '(a)lmost all education is entrusted to the clergy.' 1 Democracy in America (Bradley ed. 1945) 309, n. 4. And compare Lord Bryce's observations, a half century later, on the still largely denominational character of American higher education, 2 The American Commonwealth (1933), 734—735.
Efforts to keep the public schools of the early nineteenth century free from sectarian influence were of two kinds. One took the form of constitutional provisions and statutes adopted by a number of States forbidding appropriations from the public treasury for the support of religious instruction in any manner. See Moehlman, The Wall of Separation Between Church and State (1951), 132—135; Lardner, How Far Does the Constitution Separate Church and State? 45 Am.Pol.Sci.Rev. 110, 122 (1951). The other took the form of measures directed against the use of sectarian reading and teaching materials in the schools. The texts used in the earliest public schools had been largely taken over from the private academies, and retained a strongly religious character and content. See Nichols, Religion and American Democracy (1959), 64 80; Kinney, Church and State, The Struggle for Separation in New Hampshire, 1630—1900 (1955), 150—153. In 1827, however, Massachusetts enacted a statute providing that school boards might not thereafter 'direct any school books to be purchased or used, in any of the schools * * * which are calculated to favour any particular religious sect or tenet.' 2 Stokes, Church and State in the United States (1950), 53. For further discussion of the background of the Massachusetts law and difficulties in its early application, see Dunn, What Happened to Religious Education? (1958), c. IV. As other States followed the example of Massachusetts, the use of sectarian texts was in time as widely prohibited as the appropriation of public funds for religious instruction.
Concerning the evolution of the American public school systems free of sectarian influence, compare Mr. Justice Frankfurter's account:
'It is pertinent to remind that the establishment of this principle of Separation in the field of education was not due to any decline in the religious beliefs of the people. Horace Mann was a devout Christian, and the deep religious feeling of James Madison is stamped upon the Remonstrance. The secular public school did not imply indifference to the basic role of religion in the life of the people, nor rejection of religious education as a means of fostering it. The claims of religion were not minimized by refusing to make the public schools agencies for their assertion. The non-sectarian or secular public school was the means of reconciling freedom in general with religious freedom. The sharp confinement of the public schools of secular education was a recognition of the need of a democratic society to educate its children, insofar as the State undertook to do so, in an atmosphere free from pressures in a realm in which pressures are most resisted and where conflicts are most easily and most bitterly engendered.' Illinois ex rel. McCollum v. Board of Education, 333 U.S. 203, 216, 68 S.Ct. 461, 467, 92 L.Ed. 648.
8
The comparative religious homogeneity of the United States at the time the Bill of Rights was adopted has been considered in Haller, The Puritan Background of the First Amendment, in Read ed., The Constitution Reconsidered (1938), 131, 133—134; Beth, The American Theory of Church and State (1958), 74; Kinney, Church and State, The Struggle for Separation in New Hampshire, 1630—1900 (1955), 155—161. However, Madison suggested in the Fifty-first Federalist that the religious diversity which existed at the time of the Constitutional Convention constituted a source of strength for religious freedom, much as the multiplicity of economic and political interests enhanced the security of other civil rights. The Federalist (Cooke ed. 1961), 351—352.
9
See Comment, The Power of Courts Over the Internal Affairs of Religious Groups, 43 Calif.L.Rev. 322 (1955); Comment, Judicial Intervention in Disputes Within Independent Church Bodies, 54 Mich.L.Rev. 102 (1955); Note, Judicial Intervention in Disputes Over the Use of Church Property, 75 Harv.L.Rev. 1142 (1962). Compare Vidal v. Girard's Executors, 2 How. 127, 11 L.Ed. 205. The principle of judicial nonintervention in essentially religious disputes appears to have been reflected in the decisions of several state courts declining to enforce essentially private agreements concerning the religious education and worship of children of separated or divorced parents. See, e.g., Hackett v. Hackett, Ohio App., 150 N.E.2d 431; Stanton v. Stanton, 213 Ga. 545, 100 S.E.2d 289, 66 A.L.R.2d 1401; Friedman, The Parental Right to Control the Religious Education of a Child, 29 Harv.L.Rev. 485 (1916); 72 Harv.L.Rev. 372 (1958); Note, 10 West.Res.L.Rev. 171 (1959).
Governmental nonintervention in religious affairs and institutions seems assured by Article 26 of the Constitution of India, which provides:
'Subject to public order, morality and health, every religious denomination or any section thereof shall have the right
'(a) to establish and maintain institutions for religious and charitable purposes;
'(b) to manage its own affairs in matters of religion;
'(c) to own and acquire movable and immovable property; and
'(d) to administer such property in accordance with law.' See 1 Chaudhri, Constitutional Rights and Limitations (1955), 875. This Article does not, however, appear to have completely foreclosed judicial inquiry into the merits of intradenominational disputes. See Gledhill, Fundamental Rights in India (1955), 101 102.
10
For a discussion of the difficulties inherent in the Ballard case, see Kurland, Religion and the Law (1962), 75—79. This Court eventually reversed the convictions on the quite unrelated ground that women had been systematically excluded from the jury, Ballard v. United States, 329 U.S. 187, 67 S.Ct. 261, 91 L.Ed. 181. For discussions of the difficulties in interpreting and applying the First Amendment so as to foster to objective of neutrality without hostility, see e.g., Katz, Freedom of Religion and State Neutrality, 20 U. of Chi.L.Rev. 426, 438 (1953); Kauper, Church, State, and Freedom: A Review, 52 Mich.L.Rev. 829, 842 (1954). Compare, for an interesting apparent attempt to avoid the Ballard problem at the international level, Article 3 of the Multilateral Treaty between the United States and certain American Republics, which provides that extradition will not be granted, inter alia, when 'the offense is * * * directed against religion.' Blakely, American State Papers and Related Documents on Freedom in Religion (4th rev. ed. 1949), 316.
11
See Kurland, Religion and the Law (1962), 32—34.
12
Compare the treatment of an apparently very similar problem in Article 28 of the Constitution of India:
'(1) No religious instruction shall be provided in any educational institution wholly maintained out of State funds.
'(2) Nothing in clause (1) shall apply to an educational institution which is administered by the State but has been established under any endowment or trust which requires that religious instruction shall be imparted in such institution.' 1 Chaudhri, Constitutional Rights and Limitations (1955), 875—876, 939.
13
See Kurland, Religion and the Law (1962), 28—31; Fellman, Separation of Church and State in the United States: A Summary View, 1950 Wis.L.Rev. 427, 442.
14
This distinction, implicit in the First Amendment, had been made explicit in the original Virginia Bill of Rights provision that 'all men should enjoy the fullest toleration in the exercise of religion according to the dictates of conscience, unpunished and unrestrained by the magistrate, unless under color of religion any man disturb the peace, the happiness, or safety of society.' See Cobb, The Rise of Religious Liberty in America (1902), 491. Concerning various legislative limitations and restraints upon religiously motivated behavior which endangers or offends society, see Manwaring, Render Unto Caesar: The Flag-Salute Controversy (1962), 41—52. Various courts have applied this principle to proscribe certain religious exercises or activities which were thought to threaten the safety or morals of the participants or the rest of the community, e.g., State v. Massey, 229 N.C. 734, 51 S.E.2d 179; Harden v. State, 188 Tenn. 17, 216 S.W.2d 708; Lawson v. Commonwealth, 291 Ky. 437, 164 S.W.2d 972; cf. Sweeney v. Webb, 33 Tex.Civ.App. 324, 76 S.W. 766.
That the principle of these cases, and the distinction between belief and behavior, are susceptible of perverse application, may be suggested by Oliver Cromwell's mandate to the besieged Catholic community in Ireland:
'As to freedom of conscience, I meddle with no man's conscience; but if you mean by that, liberty to celebrate the Mass, I would have you understand that in no place where the power of the Parliament of England prevails shall that be permitted.' Quoted in Hook, The Paradoxes of Freedom (1962), 23.
15
With respect to the decision in Hamilton v. Regents, compare two recent comments: Kurland, Religion and the Law (1962), 40; and French, Comment, Unconstitutional Conditions: An Analysis, 50 Geo.L.J. 234, 236 (1961).
16
See generally as to the background and history of the Barnette case, Manwaring, Render Unto Caesar: The Flag-Salute Controversy (1962), especially at 252—253. Compare, for the interesting treatment of a problem similar to that of Barnette, in a nonconstitutional context, Chabot v. Les Commissaires D'Ecoles de Lamorandie re, (1957) Que.B.R. 707, noted in 4 McGill L.J. 268 (1958).
17
See Barron, for Use of Tiernan v. Baltimore, 7 Pet. 243, 8 L.Ed. 672; Permoli v. New Orleans, 3 How. 589, 609, 11 L.Ed. 739; cf. Fox v. Ohio, 5 How. 410, 434—435, 12 L.Ed. 213; Withers v. Buckley, 20 How. 84, 89—91, 15 L.Ed. 816. As early as 1825, however, at least one commentator argued that the guarantees of the Bill of Rights, excepting only those of the First and Seventh Amendments, were meant to limit the powers of the States. Rawle, A View of the Constitution of the United States of America (1825), 120—130.
18
In addition to the statement of this Court in Meyer, at least one state court assumed as early as 1921 that claims of abridgment of the free exercise of religion in the public schools must be tested under the guarantees of the First Amendment as well as those of the state constitution. Hardwick v. Board of School Trustees, 54 Cal.App. 696, 704—705, 205 P. 49, 52. See Louisell and Jackson, Religion, Theology, and Public Higher Education, 50 Cal.L.Rev. 751, 772 (1962). Even before the Fourteenth Amendment, New York State enacted a general common school law in 1844 which provided that no religious instruction should be given which could be construed to violate the rights of conscience 'as secured by the constitution of this state and the United States.' N.Y.Laws, 1844, c. 320, § 12.
19
See, e.g., Snee, Religious Disestablishment and the Fourteenth Amendment, 1954 Wash.U.L.Q. 371, 373—394; Kruse, The Historical Meaning and Judicial Construction of the Establishment of Religion Clause of the First Amendment, 2 Washburn L.J. 65, 84 85, 127—130 (1962); Katz, Religion and American Constitutions, Address at Northwestern University Law School, March 20, 1963, pp. 6—7. But see the debate in the Constitutional Convention over the question whether it was necessary or advisable to include among the enumerated powers of the Congress a power 'to establish an University, in which no preferences or distinctions should be allowed on account of religion.' At least one delegate thought such an explicit delegation 'is not necessary,' for '(t)he exclusive power at the Seat of Government, will reach the object.' The proposal was defeated by only two votes. 2 Farrand, Records of the Federal Convention of 1787 (1911), 616.
20
The last formal establishment, that of Massachusetts, was dissolved in 1833. The process of disestablishment in that and other States is described in Cobb, The Rise of Religious Liberty in America (1902), c. X; Sweet, The Story of Religion in America (1950), c. XIII. The greater relevance of conditions existing at the time of adoption of the Fourteenth Amendment is suggested in Note, State Sunday Laws and the Religious Guarantees of the Federal Constitution, 73 Harv.L.Rev. 729, 739, n. 79 (1960).
21
See Corwin, A Constitution of Powers in a Secular State (1951), 111—114; Fairman and Morrison, Does the Fourteenth Amendment Incorporate the Bill of Rights? 2 Stan.L.Rev. 5 (1949); Meyer, Comment, The Blaine Amendment and the Bill of Rights, 64 Harv.L.Rev. 939 (1951); Howe, Religion and Race in Public Education, 8 Buffalo L.Rev. 242, 245—247 (1959). Cf. Cooley, Principles of Constitutional Law (2d ed. 1891), 213—214. Compare Professor Freund's comment:
'Looking back, it is hard to see how the Court could have done otherwise, how it could have persisted in accepting freedom of contract as a guaranteed liberty without giving equal status to freedom of press and speech, assembly, and religious observance. What does not seem so inevitable is the inclusion within the Fourteenth Amendment of the concept of non-establishment of religion in the sense of forbidding nondiscriminatory aid to religion, where there is no interference with freedom of religious exercise.' Freund, The Supreme Court of the United States (1961), 58—59.
22
The Blaine Amendment, 4 Cong.Rec. 5580, included also a more explicit provision that 'no money raised by taxation in any State for the support of public schools or derived from any public fund therefor, nor any public lands devoted thereto, shall ever be under the control of any religious sect or denomination * * *.' The Amendment passed the House but failed to obtain the requisite two-thirds vote in the Senate. See 4 Cong.Rec. 5595. The prohibition which the Blaine Amendment would have engrafted onto the American Constitution has been incorporated in the constitutions of other nations; compare Article 28(1) of the Constitution of India ('No religious instruction shall be provided in any educational institution wholly maintained out of State funds'); Article XX of the Constitution of Japan ('* * * the State and its organs shall refrain from religious education or any other religious activity'). See 1 Chaudhri, Constitutional Rights and Limitations (1955), 875, 876.
23
Three years after the adoption of the Fourteenth Amendment, Mr. Justice Bradley wrote a letter expressing his views on a proposed constitutional amendment designed to acknowledge the dependence of the Nation upon God, and to recognize the Bible as the foundation of its laws and the supreme ruler of its conduct:
'I have never been able to see the necessity or expediency of the movement for obtaining such an amendment. The Constitution was evidently framed and adopted by the people of the United States with the Fixed determination to allow absolute religious freedom and equality, and to avoid all appearance even of a State religion, or a State endorsement of any particular creed or religious sect. * * * And after the Constitution in its original form was adopted, the people made haste to secure an amendment that Congress shall make no law respecting an establishment or religion, or prohibiting the free exercise thereof. This shows the earnest desire of our Revolutionary fathers that religion should be left to the free and voluntary action of the people themselves. I do not regard it as manifesting any hostility to religion, but as showing a fixed determination to leave the people entirely free on the subject.
'And it seems to me that our fathers were wise; that the great voluntary system of this country is quite as favorable to the promotion of real religion as the systems of governmental protection and patronage have been in other countries. And whilst I do not understand that the association which you represent desire to invoke any governmental interference, still the amendment sought is a step in that direction which our fathers (quite as good Christians as ourselves) thought it wise not to take. In this country they thought they had settled one thing at least, that it is not the province of government to teach theology.
'* * * Religion, as the basis and support of civil government, must reside, not in the written Constitution, but in the people themselves. And we cannot legislate religion into the people. It must be infused by gentler and wiser methods.' Miscellaneous Writings of Joseph P. Bradley (1901), 357—359. For a later phase of the controversy over such a constitutional amendment as that which Justice Bradley opposed, see Finlator, Christ in Congress, 4 J.Church and State 205 (1962).
24
There is no doubt that, whatever 'establishment' may have meant to the Framers of the First Amendment in 1791, the draftsmen of the Fourteenth Amendment three quarters of a century later understood the Establishment Clause to foreclose many incidental forms of governmental aid to religion which fell far short of the creation or support of an official church. The Report of a Senate Committee as early as 1853, for example, contained this view of the Establishment Clause:
'If Congress has passed, or should pass, any law which, fairly construed, has in any degree introduced, or should attempt to introduce, in favor of any church, or ecclesiastical association, or system of religious faith, all or any one of these obnoxious particulars—endowment at the public expense, peculiar privileges to its members, or disadvantages or penalties upon those who should reject its doctrines or belong to other communions—such law would be a 'law respecting an establishment of religion,' and, therefore, in violation of the constitution.' S.Rep. No. 376, 32d Cong., 2d Sess. 1—2.
Compare Thomas M. Cooley's exposition in the year in which the Fourteenth Amendment was ratified:
'Those things which are not lawful under any of the American constitutions may be stated thus:—
'1. Any law respecting an establishment of religion. * * *
'2. Compulsory support, by taxation or otherwise, of religious instruction. Not only is no one denomination to be favored at the expense of the rest, but all support of religious instruction must be entirely voluntary.' Cooley, Constitutional Limitations (1st ed. 1868), 469.
25
Compare, e.g., Miller, Roger Williams: His Contribution to the American Tradition (1953), 83, with Madison, Memorial and Remonstrance Against Religious Assessments, reprinted as an Appendix to the dissenting opinion of Mr. Justice Rutledge, Everson v. Board of Education, supra, 330 U.S. at 63—72, 67 S.Ct. at 534—538. See also Cahn, On Government and Prayer, 37 N.Y.U.L.Rev. 981, 982—985 (1962); Jefferson's Bill for Establishing Religious Freedom, in Padover, The Complete Jefferson (1943), 946—947; Moulton and Myers, Report on Appointing Chaplains to the Legislature of New York, in Blau, Cornerstones of Religious Freedom in America (1949), 141—156; Bury, A History of Freedom of Thought (2d ed. 1952), 75—76.
26
See, e.g., Spicer, The Supreme Court and Fundamental Freedoms (1959), 83—84; Kauper, Church, State, and Freedom: A Review, 52 Mich.L.Rev. 829, 839 (1954); Reed, Church-State and the Zorach Case, 27 Notre Dame Lawyer 529, 539—541 (1952).
27
See 343 U.S., at 321—322, 72 S.Ct. at 687—688 (Fraukfurter, J., dissenting); Kurland, Religion and the Law (1962), 89. I recognize that there is a question whether in Zorach the free exercise claims asserted were in fact proved. 343 U.S., at 311, 72 S.Ct., at 682.
28
Mr. Justice Frankfurter described the effects of the McCollum program thus:
'Religious education so conducted on school time and property is patently woven into the working scheme of the school. The Champaign arrangement thus presents powerful elements of inherent pressure by the school system in the interest of religious sects. * * * As a result, the public school system of Champaign actively furthers inculcation in the religious tenets of some faiths, and in the process sharpens the consciousness of religious differences at least among some of the children committed to its care.' 333 U.S., at 227—228, 68 S.Ct. at 473. For similar reasons some state courts have enjoined the public schools from employing or accepting the services of members of religious orders even in the teaching of secular subjects, e.g., Zellers v. Huff, 55 N.M. 501, 236 P.2d 949; Berghorn v. Reorganized School Dist. No. 8, 364 Mo. 121, 260 S.W.2d 573; compare ruling of Texas Commissioner of Education, Jan. 25, 1961, in 63 American Jewish Yearbook (1962), 188. Over a half century ago a New York court sustained a school board's exclusion from the public schools of teachers wearing religious garb on similar grounds:
'Then all through the school hours these teachers * * * were before the children as object lessons of the order and church of which they were members. It is within our common observation that young children * * * are very susceptible to the influence of their teachers and of the kind of object lessons continually before them in schools conducted under these circumstances and with these surroundings.' O'Connor v. Hendrick, 109 App.Div. 361, 371—372, 96 N.Y.S. 161, 169. See also Commonwealth v. Herr, 229 Pa. 132, 78 A. 68; Comment, Religious Garb in the Public Schools—A Study in Conflicting Liberties, 22 U. of Chi.L.Rev. 888 (1955).
Also apposite are decisions of several courts which have enjoined the use of parochial schools as part of the public school system, Harfst v. Hoegen, 349 Mo. 808, 163 S.W.2d 609, 141 A.L.R. 1136; or have invalidated programs for the distribution in public school classrooms of Gideon Bibles, Brown v. Orange County Board of Public Instruction, 128 So.2d 181 (Fla.App.); Tudor v. Board of Education, 14 N.J. 31, 100 A.2d 857, 45 A.L.R.2d 729. See Note, The First Amendment and Distribution of Religious Literature in the Public Schools, 41 Va.L.Rev. 789, 803—806 (1955). In Tudor, the court stressed the role of the public schools in the Bible program:
'* * * the public school machinery is used to bring about the distribution of these Bibles to the children * * *. In the eyes of the pupils and their parents the board of education has placed its stamp of approval upon this distribution and, in fact, upon the Gideon Bible itself. * * * This is more than mere 'accommodation' of religion permitted in the Zorach case. The school's part in this distribution is an active one and cannot be sustained on the basis of a mere assistance to religion.' 14 N.J., at 51—52, 100 A.2d at 868.
The significance of the teacher's authority was recognized by one early state court decision:
'The school being in session, the right to command was vested in the teacher, and the duty of obedience imposed upon the pupils. Under such circumstances a request and a command have the same meaning. A request from one in authority is understood to be a mere euphemism. It is in fact a command in an inoffensive form.' State ex rel. Freeman v. Scheve, 65 Neb. 853, 876, 880, 93 N.W. 169, 170.
29
See for other illustrations of the principle that where First Amendment freedoms are or may be affected, government must employ those means which will least inhibit the exercise of constitutional liberties, Lovell v. City of Griffin, 303 U.S. 444, 58 S.Ct. 666, 82 L.Ed. 949; Schneider v. State of New Jersey, 308 U.S. 147, 161, 60 S.Ct. 146, 84 L.Ed. 155; Martin v. City of Struthers, 319 U.S. 141, 63 S.Ct. 862, 87 L.Ed. 1313; Saia v. New York, 334 U.S. 558, 68 S.Ct. 1148, 92 L.Ed. 1574; Shelton v. Tucker, 364 U.S. 479, 488—489, 81 S.Ct. 247, 5 L.Ed.2d 231; Bantam Books, Inc., v. Sullivan, 372 U.S. 58, 66, 69—71, 83 S.Ct. 631, 9 L.Ed.2d 584. See also Note, State Sunday Laws and the Religious Guarantees of the Federal Constitution, 73 Harv.L.Rev. 729, 743 745 (1960); Freund, The Supreme Court of the United States (1961), 86—87; 74 Harv.L.Rev. 613 (1961). And compare Miller v. Cooper, 56 N.M. 355, 244 P.2d 520 (1952), in which a state court permitted the holding of public school commencement exercises in a church building only because no public buildings in the community were adequate to accommodate the ceremony.
30
No question has been raised in these cases concerning the standing of these parents to challenge the religious practices conducted in the schools which their children presently attend. Whatever authority Doremus v. Board of Education of Borough of Hawthorne, 342 U.S. 429, 72 S.Ct. 394, 96 L.Ed. 475, might have on the question of the standing of one not the parent of children affected by the challenged exercises is not before us in these cases. Neither in McCollum nor in Zorach was there any reason to question the standing of the parent-plaintiffs under settled principles of justiciability and jurisdiction, whether or not their complaints alleged pecuniary loss or monetary injury. The free-exercise claims of the parents alleged injury sufficient to give them standing. If, however, the gravamen of the lawsuit were exclusively one of establishment, it might seem illogical to confer standing upon a parent who—though he is concededly in the best position to assert a free-exercise claim—suffers no financial injury, by reason of being a parent, different from that of the ordinary taxpayer, whose standing may be open to question. See Sutherland, Establishment According to Engel, 76 Harv.L.Rev. 25, 41—43 (1962). I would suggest several answers to this conceptual difficulty. First, the parent is surely the person most directly and immediately concerned about and affected by the challenged establishment, and to deny him standing either in his own right or on behalf of his child might effectively foreclose judicial inquiry into serious breaches of the prohibitions of the First Amendment—even though no special monetary injury could be shown. See Schempp v. School District of Abington Township, D.C., 177 F.Supp. 398, 407; Kurland, The Regents' Prayer Case: 'Full of Sound and Fury, Signifying * * *,' 1962 Supreme Court Review 1, 22. Second, the complaint in every case thus far challenging an establishment has set forth at least a colorable claim of infringement of free exercise. When the complaint includes both claims, and neither is frivolous, it would surely be overtechnical to say that a parent who does not detail the monetary cost of the exercises to him may ask the court to pass only upon the free-exercise claim, however logically the two may be related. Cf. Pierce v. Society of Sisters, supra; Truax v. Raich, 239 U.S. 33, 38—39, 36 S.Ct. 7, 60 L.Ed. 131; NAACP v. Alabama ex rel. Patterson, 357 U.S. 449, 458—460, 78 S.Ct. 1163, 2 L.Ed.2d 1488; Bell v. Hood, 327 U.S. 678, 66 S.Ct. 773, 90 L.Ed. 939; Bantam Books, Inc., v. Sullivan, 372 U.S. 58, 64, n. 6, 83 S.Ct. 631, 9 L.Ed.2d 584. Finally, the concept of standing is a necessarily flexible one, designed principally to ensure that the plaintiffs have 'such a personal stake in the outcome of the controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for illumination of difficult constitutional questions * * *.' Baker v. Carr, 369 U.S. 186, 204, 82 S.Ct. 691, 703, 7 L.Ed.2d 663. It seems to me that even a cursory examination of the complaints in these two cases and the opinions below discloses that these parents have very real grievances against the respective school authorities which cannot be resolved short of constitutional adjudication. See generally Arthur Garfield Hays Civil Liberties Conference: Public Aid to Parochial Schools and Standing to Bring Suit, 12 Buffalo L.Rev. 35 (1962); Jaffe, Standing to Secure Judicial Review: Public Actions, 74 Harv.L.Rev. 1265 (1961); Sutherland, Due Process and Disestablishment, 62 Harv.L.Rev. 1306, 1327—1332 (1949); Comment, The Supreme Court, the First Amendment, and Religion in the Public Schools, 63 Col.L.Rev. 73, 94, n. 153 (1963).
31
Quoted in Dunn, What Happened to Religious Education? (1958), 21.
32
Quoted, id., at 22.
33
Quoted in Hartford, Moral Values in Public Education: Lessons From the Kentucky Experience (1958), 31.
34
See Culver, Horace Mann and Religion in the Massachusetts Public Schools (1929), for an account of one prominent educator's efforts to satisfy both the protests of those who opposed continuation of sectarian lessons and exercises in public schools, and the demands of those who insisted upon the retention of some essentially religious practices. Mann's continued use of the Bible for what he regarded as nonsectarian exercises represented his response to these cross-pressures. See Mann, Religious Education, in Blau, Cornerstones of Religious Freedom in America (1949), 163 201 (from the Twelfth Annual Report for 1848 of the Secretary of the Board of Education of Massachusetts). See also Boles, The Bible, Religion, and the Public Schools (1961), 22—27.
35
See 2 Stokes, Church and State in the United States (1950), 572—579; Greene, Religion and the State: The Making and Testing of an American Tradition (1941), 122—126.
36
E.g., Ala.Code, Tit. 52, § 542; Del.Code Ann., Tit. 14, §§ 4101, 4102; Fla.Stat.Ann. § 231.09(2); Mass.Ann.Laws, c. 71, § 31; Tenn.Code Ann. § 49—1307(4). Some statutes, like the recently amended Pennsylvania statute involved in Schempp, provide for the excusal or exemption of children whose parents do not wish them to participate. See generally Johnson and Yost, Separation of Church and State in the United States (1948), 33—36; Thayer, The Role of the School in American Society (1960), 374—375; Beth, The American Theory of Church and State (1958), 106—107. Compare with the American statutory approach Article 28(3) of the Constitution of India:
'(3) No person attending any educational institution recognised by the State or receiving aid out of State funds shall be required to take part in any religious instruction that may be imparted in such institution or to attend any religious worship that may be conducted in such institution or in any premises attached thereto unless such person or, if such person is a minor, his guardian has given his consent thereto.' See 1 Chaudhri, Constitutional Rights and Limitations (1955), 876, 939.
37
See note 34, supra.
38
Quoted from New Hampshire School Reports, 1850, 31—32, in Kinney, Church and State: The Struggle for Separation in New Hampshire, 1630—1900 (1955), 157—158.
39
Quoted in Boyer, Religious Education of Public School Pupils in Wisconsin, 1953 Wis.L.Rev. 181, 186.
40
Quoted in Dunn, What Happened to Religious Education? (1958), 271.
41
Quoted in Butts, The American Tradition in Religion and Education (1950), 135—136.
42
See Board of Education of City of Cleveland v. Minor, 23 Ohio St. 211; Blakely, American State Papers and Related Documents on Freedom in Religion (4th rev. ed. 1949), 864.
43
Report of the United States Commissioner of Education for the Year 1888—1889, part I, H.R.Exec.Doc. No. 1, part 5, 51st Cong., 1st Sess. 627.
44
Quoted in Illinois ex rel. McCollum v. Board of Education, supra, 333 U.S. at 218, 68 S.Ct. at 468 (opinion of Frankfurter, J.) See also President Grant's Annual Message to Congress, Dec. 7, 1875, 4 Cong.Rec. 175 et seq., which apparently inspired the drafting and submission of the Blaine Amendment. See Meyer, Comment, The Blaine Amendment and the Bill of Rights, 64 Harv.L.Rev. 939 (1951).
45
Theodore Roosevelt to Michael A. Schaap, Feb. 22, 1915, 8 Letters of Theodore Roosevelt (Morison ed. 1954), 893.
46
Quoted in Boles, The Bible, Religion, and the Public Schools (1961), 238.
47
E.g., 1955 Op.Ariz.Atty.Gen. 67; 26 Ore.Op.Atty.Gen. 46 (1952); 25 Cal.Op.Atty.Gen. 316 (1955); 1948—1950 Nev.Atty.Gen.Rep. 69 (1948). For a 1961 opinion of the Attorney General of Michigan to the same effect, see 63 American Jewish Yearbook (1962) 189. In addition to the Governor of Ohio, see note 46, supra, a Governor of Arizona vetoed a proposed law which would have permitted 'reading the Bible, without comment, except to teach Historical or Literary facts.' See 2 Stokes, Church and State in the United States (1950), 568.
48
See Johnson and Yost, Separation of Church and State in the United States (1948), 71; Note, Bible Reading in Public Schools, 9 Vand.L.Rev. 849, 851 (1956).
49
E.g., Spiller v. Inhabitants of Woburn, 12 Allen (94 Mass. 127) 127 (1866); Donahoe v. Richards, 38 Maine 376, 413 (1854); cf. Ferriter v. Tyler, 48 Vt. 444, 471—472 (1876).
50
Board of Education of City of Cleveland v. Minor, 23 Ohio St. 211 (1873).
51
People ex rel. Ring v. Board of Education of Dist. No. 24, 245 Ill. 334, 92 N.E. 251 (1910); Herold v. Parish Board of School Directors, 136 La. 1034, 68 So. 116 (1915); State ex rel. Weiss v. District Board, 76 Wis. 177, 44 N.W. 967 (1890); State ex rel. Finger v. Weedman, 55 S.D. 343, 226 N.W. 348 (1929); State ex rel. Dearle v. Frazier, 102 Wash. 369, 173 P. 35 (1918); cf. State ex rel. Clithero v. Showalter, 159 Wash. 519, 293 P. 1000 (1930); State ex rel. Freeman v. Scheve, 65 Neb. 853, 91 N.W. 846 (1902), modified, 65 Neb. 876, 93
N.W. 169 (1903). The cases are discussed in Boles, The Bible, Religion, and the Public Schools (1961), c. IV; Harrison, The Bible, the Constitution and Public Education, 29 Tenn.L.Rev. 363, 386—389 (1962).
52
Moore v. Monroe, 64 Iowa 367, 20 N.W. 475 (1884); Hackett v. Brooksville Graded School District, 120 Ky. 608, 87 S.W. 792 (1905); Billard v. Board of Education, 69 Kan. 53, 76 P. 422 (1904); Pfeiffer v. Board of Education, 118 Mich. 560, 77 N.W. 250 (1898); Kaplan v. Independent School District, 171 Minn. 142, 214 N.W. 18 (1927); Lewis v. Board of Education of City of New York, 157 Misc. 520, 285 N.Y.S. 164 (Sup.Ct.1935), modified on other grounds, 247 App.Div. 106, 286 N.Y.S. 174 (1936), appeal dismissed, 276 N.Y. 490, 12 N.E.2d 172 (1937); Doremus v. Board of Education, 5 N.J. 435, 75 A.2d 880 (1950), appeal dismissed, 342 U.S. 429, 72 S.Ct. 394, 96 L.Ed. 475; Church v. Bullock, 104 Tex. 1, 109 S.W. 115, 16 L.R.A.,N.S., 860 (1908); People ex rel. Vollmar v. Stanley, 81 Colo. 276, 255 P. 610 (1927); Wilkerson v. City of Rome, 152 Ga. 762, 110 S.E. 895, 20 A.L.R. 1334 (1922); Carden v. Bland, 199 Tenn. 665, 288 S.W.2d 718 (1956); Chamberlin v. Dade County Board of Public Instruction, 143 So.2d 21 (Fla.1962).
53
For discussion of the constitutional and statutory provisions involved in the state cases which sustained devotional exercises in the public schools, see Boles, The Bible, Religion, and the Public Schools (1961), c. III; Harrison, The Bible, the Constitution and Public Education, 29 Tenn.L.Rev. 363, 381—385 (1962); Fellman, Separation of Church and State in the United States: A Summary View, 1950 Wis.L.Rev. 427, 450—452; Note, Bible Reading in Public Schools, 9 Vand.L.Rev. 849, 854—859 (1956); Note, Nineteenth Century Judicial Thought Concerning Church-State Relations, 40 Minn.L.Rev. 672, 675—678 (1956). State courts appear to have been increasingly influenced in sustaining devotional practices by the availability of an excuse or exemption for dissenting students. See Cushman, The Holy Bible and the Public Schools, 40 Cornell L.Q. 475, 477 (1955); 13 Vand.L.Rev. 552 (1960).
54
See Rosenfield, Separation of Church and State in the Public Schools, 22 U. of Pitt.L.Rev. 561, 571—572 (1961); Harrison, The Bible, the Constitution and Public Education, 29 Tenn.L.Rev. 363, 399—400 (1962); 30 Ford.L.Rev. 801, 803 (1962); 45 Va.L.Rev. 1381 (1959). The essentially religious character of the materials used in these exercises is, in fact, strongly suggested by the presence of excusal or exemption provisions, and by the practice of rotating or alternating the use of different prayers and versions of the Holy Bible.
55
In the Billard case, the teacher whose use of the Lord's Prayer and the Twenty-third Psalm was before the court testified that the exercise served disciplinary rather than spiritual purposes:
'It is necessary to have some general exercise after the children come in from the playground to prepare them for their work. You need some general exercise to quiet them down.'
When asked again if the purpose were not at least partially religious, the teacher replied, (i)t was religious to the children that are religious, and to the others it was not.' 69 Kan., at 57 58, 76 P., at 423.
56
See, e.g., Henry, The Place of Religion in Public Schools (1950); Martin, Our Public Schools—Christian or Secular (1952); Educational Policies Comm'n of the National Educational Assn., Moral and Spiritual Values in the Public Schools (1951), c. IV; Harner, Religion's Place in General Education (1949). Educators are by no means unanimous, however, on this question. See Boles, The Bible, Religion, and the Public Schools (1961), 223—224. Compare George Washington's advice in his Farewell Address:
'And let us with caution indulge the supposition, that morality can be maintained without religion. Whatever may be conceded to the influence of refined education on minds of peculiar structure, reason and experience both forbid us to expect that National morality can prevail in exclusion of religious principle.' 35 Writings of George Washington (Fitzpatrick ed. 1940), 229.
57
Thomas Jefferson's insistence that where the judgments of young children 'are not sufficiently matured for religious inquiries, their memories may here be stored with the most useful facts from Grecian, Roman, European and American history,' 2 Writings of Thomas Jefferson (Memorial ed. 1903), 204, is relevant here. Recent proposals have explored the possibility of commencing the school day 'with a quiet moment that would still the tumult of the playground and start a day of study,' Editorial, Washington Post, June 28, 1962, § A, p. 22, col. 2. See also New York Times, Aug. 30, 1962, § 1, p. 18, col. 2. For a consideration of these and other alternative proposals see Choper, Religion in the Public Schools: A Proposed Constitutional Standard, 47 Minn.L.Rev. 329, 370—371 (1963). See also 2 Stokes, Church and State in the United States (1950), 571.
58
The history, as it bears particularly upon the role of sectarian differences concerning Biblical texts and interpretation, has been summarized in Tudor v. Board of Education, 14 N.J. 31, 36—44, 100 A.2d 857, 859—864, 45 A.L.R.2d 729. See also State ex rel. Weiss v. District Board, 76 Wis. 177, 190—193, 44 N.W. 967, 972—975, 7 L.R.A. 330. One state court adverted to these differences a half century ago:
'The Bible, in its entirety, is a sectarian book as to the Jew and every believer in any religion other than the Christian religion, and as to those who are heretical or who hold beliefs that are not regarded as orthodox * * * its use in the schools necessarily results in sectarian instruction. There are many sects of Christians, and their differences grow out of their differing constructions of various parts of the Scriptures—the different conclusions drawn as to the effect of the same words. The portions of Scripture which form the basis of these sectarian differences cannot be thoughtfully and intelligently read without impressing the reader, favorably or otherwise, with reference to the doctrines supposed to be derived from then.' People ex rel. Ring v. Board of Education, 245 Ill. 334, 347—348, 92 N.E. 251, 255, 29 L.R.A.,N.S., 442. But see, for a sharply critical comment, Schofield, Religious Liberty and Bible Reading in Illinois Public Schools, 6 Ill.L.Rev. 17 (1911).
See also Dunn, What Happened to Religious Education? (1958), 268—273; Dawson, America's Way in Church, State, and Society (1953), 53—54; Johnson and Yost, Separation of Church and State in the United States (1948), c. IV; Harpster, Religion, Education and the Law, 36 Marquette L.Rev. 24, 44—45 (1952); 20 Ohio State L.J. 701, 702—703 (1959).
59
See Torcaso v. Watkins, supra, 367 U.S. at 495, n. 11, 81 S.Ct. at 1684; Cushman, The Holy Bible and the Public Schools, 40 Cornell L.Q. 475, 480—483 (1955); Note, Separation of Church and State: Religious Exercises in the Schools, 31 U. of Cinc.L.Rev. 408, 411—412 (1962). Few religious persons today would share the universality of the Biblical canons of John Quincy Adams:
'You ask me what Bible I take as the standard of my faith—the Hebrew, the Samaritan, the old English translation, or what? I answer, the Bible containing the sermon upon the mount—any Bible that I can read and understand. * * * I take any one of them for my standard of faith. If Socinus or Preistley had made a fair translation of the Bible, I would have taken that, but without their comments.' John Quincy Adams to John Adams, Jan. 3, 1817, in Koch and Peden, Selected Writings of John and John Quincy Adams (1946), 292.
60
Rabbi Solomon Grayzel testified before the District Court, 'In Judaism the Bible is not read, it is studied. There is no special virtue attached to a mere reading of the Bible; there is a great deal of virtue attached to a study of the Bible.' See Boles, The Bible, Religion, and the Public Schools (1961), 208 218; Choper, Religion in the Public Schools: A Proposed Constitutional Standard, 47 Minn.L.Rev. 329, 372—375 (1963). One religious periodical has suggested the danger that 'an observance of this sort is likely to deteriorate quickly into an empty formality with little, if any spiritual significance. Prescribed forms of this sort, as many colleges have concluded after years of compulsory chapel attendance, can actually work against the inculcation of vital religion.' Prayers in Public Schools Opposed, 69 Christian Century, Jan. 9, 1952, p. 35.
61
See Cahn, On Government and Prayer, 37 N.Y.U.L.Rev. 981, 993—994 (1962). A leading Protestant journal recently noted:
'Agitation for removal of religious practices in public schools is not prompted or supported entirely by Jews, humanists, and atheists. At both local and national levels, many Christian leaders, concerned both for civil rights of minorities and for adequate religious education, are opposed to religious exercises in public schools. * * * Many persons, both Jews and Christians, believe that prayer and Bible reading are too sacred to be permitted in public schools in spite of their possible moral value.' Smith, The Religious Crisis In Our Schools, 128 The Episcopalian, May 1963, pp. 12—13. See, e.g., for other recent statements on this question, Editorial, Amending the Amendment, 108 America, May 25, 1963, p. 736; Sissel, A Christian View: Behind the Fight Against School Prayer, 27 Look, June 18, 1963, p. 25.
It should be unnecessary to demonstrate that the Lord's Prayer, more clearly than the Regents' Prayer involved in Engel v. Vitale, is an essentially Christian supplication. See, e.g., Scott, The Lord's Prayer: Its Character, Purpose, and Interpretation (1951), 55; Buttrick, So We Believe, So We Pray (1951), 142; Levy Lord's Prayer, in 7 Universal Jewish Encyclopedia (1948), 192—193.
62
Statement of the Baptist Joint Committee on Public Affairs, in 4 J. Church and State 144 (1962).
63
See Harrison, The Bible, the Constitution and Public Education, 29 Tenn.L.Rev. 363, 397 (1962). The application of statutes and regulations which forbid comment on scriptural passages is further complicated by the view of certain religious groups that reading without comment is either meaningless or actually offensive. Compare Rabbi Grayzel's testimony before the District Court that 'the Bible is misunderstood when it is taken without explanation.' A recent survey of the attitudes of certain teachers disclosed concern that 'refusal to answer pupil questions regarding any curricular activity is not educationally sound,' and that reading without comment might create in the minds of the pupils the impression that something was 'hidden or wrong.' Boles, The Bible, Religion, and the Public Schools (1961), 235—236. Compare the comment of a foreign observer: 'In no other field of learning would we expect a child to draw the full meaning from what he reads without accompanying explanatory comment. But comment by the teacher will inevitably reveal his own personal preferences; and the exhibition of preferences is what we are seeking to eliminate.' MacKinnon, Freedom?—or Tolerations? The Problem of Church and State in the United States, (1959) Pub.Law 374, 383.
64
See Abbott, A Common Bible Reader for Public Schools, 56 Religious Education 20 (1961); Note, 22 Albany L.Rev. 156—157 (1958); 2 Stokes, Church and State in the United States (1950), 501—506 (describing the 'common denominator' or 'three faiths' plan and certain programs of instruction designed to implement the 'common core' approach). The attempts to evolve a universal, non-denominational prayer are by no means novel. See, e.g., Madison's letter to Edward Everett, March 19, 1823, commenting upon a 'project of a prayer * * * intended to comprehend & conciliate College Students of every (Christian) denomination, by a Form composed wholly of texts & phrases of scripture.' 9 Writings of James Madison (Hunt ed. 1910), 126. For a fuller description of this and other attempts to fashion a 'common core' or nonsectarian exercise, see Engel v. Vitale, 18 Misc.2d 659, 660 662, 191 N.Y.S.2d 453, 459—460.
65
See the policy statement recently drafted by the National Council of the Churches of Christ: '* * * neither true religion nor good education is dependent upon the devotional use of the Bible in the public school program. * * * Apart from the constitutional questions involved, attempts to establish a 'common core' of religious beliefs to be taught in public schools for the purpose of indoctrination are unrealistic and unwise. Major faith groups have not agreed on a formulation of religious beliefs common to all. Even if they had done so, such a body of religious doctrine would tend to become a substitute for the more demanding commitments of historic faiths.' Washington Post, May 25, 1963, § A, p. 1, col. 4. See also Choper, Religion in the Public Schools: A Proposed Constitutional Standard, 47 Minn.L.Rev. 329, 341, 368 369 (1963). See also Hartford Moral Values in Public Education: Lessons from the Kentucky Experience (1958), 261—262; Moehlman, The Wall of Separation Between Church and State (1951), 158—159. Cf. Mosk, 'Establishment Clause' Clarified, 22 Law in Transition 231, 235—236 (1963).
66
Quoted in Kurland, The Regents' Prayer Case: 'Full of Sound and Fury, Signifying * * *,' 1962 Supreme Court Review (1962), 1, 31.
67
Quoted in Harrison, The Bible, the Constitution and Public Education, 29 Tenn.L.Rev. 363, 417 (1962). See also Dawson, America's Way in Church, State, and Society (1953), 54.
68
See the testimony of Edward L. Schempp, the father of the children in the Abington schools and plaintiff-appellee in No. 142, concerning his reasons for not asking that his children be excused from the morning exercises after excusal was made available through amendment of the statute:
'We originally objected to our children being exposed to the reading of the King James version of the Bible * * * and under those conditions we would have theoretically liked to have had the children excused. But we felt that the penalty of having our children labelled as 'odd balls' before their teachers and classmates every day in the year was even less satisfactory than the other problem. * * *
'The children, the classmates of Roger and Donna are very liable to label and lump all particular religious difference or religious objec-
tions as atheism, particularly, today the word 'atheism' is so often tied to atheistic communism, and atheism has very bad connotations in the minds of children and many adults today.'
A recent opinion of the Attorney General of California gave as one reason for finding devotional exercises unconstitutional the likelihood that '(c)hildren forced by conscience to leave the room during such exercises would be placed in a position inferior to that of students adhering to the State-endorsed religion.' 25 Cal.Op.Atty.Gen. 316, 319 (1955). Other views on this question, and possible effects of the excusal procedure, are summarized in Rosenfield, Separation of Church and State in the Public Schools, 22 U. of Pitt.L.Rev. 561, 581—585 (1961); Note, Separation of Church and State: Religious Exercises in the Schools, 31 U. of Cinc.L.Rev. 408, 416 (1962); Note, 62 W.Va.L.Rev. 353, 358 (1960).
69
Extensive testimony by behavioral scientists concerning the effect of similar practices upon children's attitudes and behaviors is discussed in Tudor v. Board of Education, 14 N.J. 31, 50—52, 100 A.2d 857, 867—868, 45 A.L.R.2d 729. See also Choper, Religion in the Public Schools: A Proposed Constitutional Standard, 47 Minn.L.Rev. 329, 344 (1963). There appear to be no reported experiments which bear directly upon the question under consideration. There have, however, been numerous experiments which indicate the susceptibility of school children to peer-group pressures, especially where important group norms and values are involved. See, e.g., Berenda, The Influence of the Group on the Judgments of Children (1950), 26—33; Argyle, Social Pressure in Public and Private Situations, 54 J. Abnormal & Social Psych. 172 (1957); cf. Rhine, The Effect of Peer
Group Influence Upon Concept-Attitude Development and Change, 51 J. Social Psych. 173 (1960); French, Morrison and Levinger, Coercive Power and Forces Affecting Conformity, 61 J. Abnormal and Social Psych. 93 (1960). For a recent and important experimental study of the susceptibility of students to various factors in the school environment, see Zander, Curtis and Rosenfeld, The Influence of Teachers and Peers on Aspirations of Youth (U.S. Office of Education Cooperative Research Project No. 451, 1961), 24—25, 78—79. It is also apparent that the susceptibility of school children to prestige suggestion and social influence within the school environment varies inversely with the age, grade level, and consequent degree of sophistication of the child, see Patel and Gordon, Some Personal and Situational Determinants of Yielding to Influence, 61 J. Abnormal and Social Psych. 411, 417 (1960).
Experimental findings also shed some light upon the probable effectiveness of a provision for excusal when, as is usually the case, the percentage of the class wishing not to participate in the exercises is very small. It has been demonstrated, for example, that the inclination even of adults to depart or dissent overtly from strong group norms varies proportionately with the size of the dissenting group—that is, inversely with the apparent or perceived strength of the norm itself—and and is markedly slighter in the case of the sole or isolated dissenter. See, e.g., Asch, Studies of Independence and Conformity: a Unanimous Majority (Psych. Monographs No. 416, 1956), 69—70; Asch, Effects of Group Pressure upon the Modification and Distortion of Judgments, in Cartwright and Zander, Group Dynamics (2d ed. 1960), 189—199; Luchins and Luchins, On Conformity With True and False Communications, 42 J. Social Psych. 283 (1955). Recent important findings on these questions are summarized in Hare, Handbook of Small Group Research (1962), c. II.
70
See, on the general problem of conflict and accommodation between the two clauses, Katz, Freedom of Religion and State Neutrality, 20 U. of Chi.L.Rev. 426, 429 (1953); Griswold, Absolute Is In the Dark, 8 Utah L.Rev. 167, 176—179 (1963); Kauper, Church, State, and Freedom: A Review, 52 Mich.L.Rev. 829, 833 (1954). One author has suggested that the Establishment and Free Exercise Clauses must be 'read as stating a single precept: that government cannot utilize religion as a standard for action or inaction because these clauses, read together as they should be, prohibit classification in terms of religion either to confer a benefit or to impose a burden.' Kurland, Beligion and the Law (1962), 112. Compare the formula of accommodation embodied in the Australian Constitution, § 116:
'The Commonwealth shall not make any law for establishing any religion, or for imposing any religious observance, or for prohibiting the free exercise of any religion, and no religious test shall be required as a qualification for any office or public trust under the Commonwealth.' Essays on the Australian Constitution (Else-Mitchell ed. 1961), 15.
71
There has been much difference of opinion throughout American history concerning the advisability of furnishing chaplains at government expense. Compare, e.g., Washington's order regarding chaplains for the Continental Army, July 9, 1776, in 5 Writings of George Washington (Fitzpatrick ed. 1932), 244, with Madison's views on a very similar question, letter to Edward Livingston, July 10, 1822, 9 Writings of James Madison (Hunt ed. 1910), 100—103. Compare also this statement by the Armed Forces Chaplains Board concerning the chaplain's obligation:
'To us has been entrusted the spiritual and moral guidance of the young men and women in the Armed Services of this country. A chaplain has many duties—yet, first and foremost is that of presenting God to men and women wearing the military uniform. What happens to them while they are in military service has a profound effect on what happens in the community as they resume civilian life. We, as chaplains, must take full cognizance of that fact and dedicate our work to making them finer, spiritually strengthened citizens.' Builders of Faith (U.S. Department of Defense 1955), ii.
It is interesting to compare in this regard an express provision, Article 140, of the Weimar Constitution: 'Necessary free time shall be accorded to the members of the armed forces for the fulfilment of their religious duties.' McBain and Rogers, The New Constitutions of Europe (1922), 203.
72
For a discussion of some recent and difficult problems in connection with chaplains and religious exercises in prisons, see, e.g., Pierce v. La Vallee, 2 Cir., 293 F.2d 233; In re Ferguson, 55 Cal.2d 663, 12 Cal.Rptr. 753, 361 P.2d 417; McBride v. McCorkle, 44 N.J.Super. 468, 130 A.2d 881; Brown v. McGinnis, 10 N.Y.2d 531, 225 N.Y.S.2d 497, 180 N.E.2d 791; discussed in Comment, 62 Col.L.Rev. 1488 (1962); 75 Harv.L.Rev. 837 (1962). Compare Article XVIII of the Hague Convention Regulations of 1899:
'Prisoners of war shall enjoy every latitude in the exercise of their religion, including attendance at their own church services, provided only they comply with the regulations for order and police issued by the military authorities.' Quoted in Blakely, American State Papers and Related Documents on Freedom in Religion (4th rev. ed. 1949), 313.
73
Compare generally Sibley and Jacob, Conscription of Conscience: The American State and the Conscientious Objector, 1940—1947 (1952), with Conklin, Conscientious Objector Provisions: A View in the Light of Torcaso v. Watkins, 51 Geo.L.J. 252 (1963).
74
See, e.g., Southside Estates Baptist Church v. Board of Trustees, 115 So.2d 697 (Fla.); Lewis v. Mandeville, 201 Misc. 120, 107 N.Y.S.2d 865; cf. School District No. 97 v. Schmidt, 128 Colo. 495, 263 P.2d 581 (temporary loan of school district's custodian to church). A different problem may be presented with respect to the regular use of public school property for religious activities, State ex rel. Gilbert v. Dilley, 95 Neb. 527, 145 N.W. 999, 50 N.R.A.,N.S., 1182; the erection on public property of a statute of or memorial to an essentially religious figure, State ex rel. Singelmann v. Morrison, 57 So.2d 238 (La.App.); seasonal displays of a religious character, Baer v. Kolmorgen, 14 Misc.2d 1015, 181 N.Y.S.2d 230; or the performance on public property of a drama or opera based on religious material or carrying a religious message, cf. County of Los Angeles v. Hollinger, 200 Cal.App.2d 877, 19 Cal.Rptr. 648.
75
Compare Moulton and Myers, Report on Appointing Chaplains to the Legislature of New York, in Blau, Cornerstones of Religious Freedom in America (1949), 141—156; Comment, 63 Col.L.Rev. 73, 97 (1963).
76
A comprehensive survey of the problems raised concerning the role of religion in the secular curriculum is contained in Brown, ed., The Study of Religion in the Public Schools: An Appraisal (1958). See also Katz, Religion and American Constitutions, Lecture at Northwestern University Law School, March 21, 1963, pp. 37—41; Educational Policies Comm'n of the National Education Assn., Moral and Spiritual Values in the Public Schools (1951), 49—80. Compare, for a consideration of similar problems in state-supported colleges and universities, Louisell and Jackson, Religion, Theology, and Public Higher Education, 50 Cal.L.Rev. 751 (1962).
77
See generally Torpey, Judicial Doctrines of Religious Rights in America (1948), c. VI; Van Alstyne, Tax Exemption of Church Property, 20 Ohio State L.J. 461 (1959); Sutherland, Due Process and Disestablishment, 62 Harv.L.Rev. 1306, 1336—1338 (1949); Louisell and Jackson, Religion, Theology, and Public Higher Education, 50 Cal.L.Rev. 751, 773—780 (1962); 7 De Paul L.Rev. 206 (1958); 58 Col.L.Rev. 417 (1958); 9 Stan.L.Rev. 366 (1957).
78
See, e.g., Washington Ethical Society v. District of Columbia, 101 U.S.App.D.C. 371, 249 F.2d 127; Fellowship of Humanity v. County of Alameda, 153 Cal.App.2d 673, 315 P.2d 394.
1
It is instructive, in this connection, to examine the complaints in the two cases before us. Neither complaint attacks the challenged practices as 'establishments.' What both allege as the basis for their causes of actions are, rather, violations of religious liberty.
2
310 U.S., at 303, 60 S.Ct., at 903, 84 L.Ed. 1213. The Court's statement as to the Establishment Clause in Cantwell was dictum. The case was decided on free exercise grounds.
3
See also, in this connection, Zorach v. Clauson, 343 U.S. 306, 314, 72 S.Ct. 679, 684, 96 L.Ed. 954: 'Government may not finance religious groups nor undertake religious instruction nor blend secular and sectarian education nor use secular institutions to force one or some religion on any person. But we find no constitutional requirement which makes it necessary for government to be hostile to religion and to throw its weight against efforts to widen the effective scope of religious influence.'
4
'This is beyond all question a utilization of the tax-established and tax-supported public school system to aid religious groups to spread their faith.' Illinois ex rel. McCollum v. Board of Education, 333 U.S. 203, 210, 68 S.Ct. 461, 464, 92 L.Ed. 649. (Emphasis added.)
5
The Pennsylvania statute was specifically amended to remove the compulsion upon teachers. Act of December 17, 1959, P.L.1928, 24 Purdon's Pa.Stat.Ann. § 15—1516. Since the Maryland case is here on a demurrer, the issue of whether or not a teacher could be dismissed for refusal to participate seems, among many others, never to have been raised.
6
See, e.g., the description of a plan permitting religious instruction off school property contained in Illinois ex rel. McCollum v. Board of Education, 333 U.S. 203, 224, 68 S.Ct. 461, 478, 92 L.Ed. 649 (separate opinion of Mr. Justice Frankfurther).
7
Cf. 'The task of separating the secular from the religious in education is one of magnitude, intricacy and delicacy. To lay down a sweeping constitutional doctrine as demanded by complainant and apparently approved by the Court, applicable alike to all school boards of the nation, * * * is to decree a uniform, rigid and, if we are consistent, an unchanging standard for countless school boards representing and serving highly localized groups which not only differ from each other but which themselves from time to time change attitudes. It seems to me that to do so is to allow zeal for our own ideas of what is good in public instruction to induce us to accept the role of a super board of education for every school district in the nation.' Illinois ex rel. McCollum v. Board of Education, 333 U.S. 203, 237, 68 S.Ct. 461, 478, 92 L.Ed. 649 (concurring opinion of Mr. Justice Jackson).
8
For example, if the record in the Schempp case contained proof (rather than mere prophecy) that the timing of morning announcements by the school was such as to handicap children who did not want to listen to the Bible reading, or that the excusal provision was so administered as to carry any overtones of social inferiority, then impermissible coercion would clearly exist.
| 23
|
374 U.S. 503
83 S.Ct. 1879
10 L.Ed.2d 1045
Robert Louis BONEv.UNITED STATES.
No. 716, Misc.
Supreme Court of the United States
June 17, 1963
Robert Louis Bone, pro se.
Solicitor General Cox, Assistant Attorney General Miller, Beatrice Rosenberg and Richard W. Schmude, for the United States.
On Petition for Writ of Certiorari to the United States Court of Appeals for the Eighth Circuit.
PER CURIAM.
1
The motion for leave to proceed in forma pauperis and the petition for writ of certiorari are granted. The judgment is vacated and the case is remanded for further consideration in light of Sanders v. United States, 373 U.S. 1, 83 S.Ct. 1068.
2
Mr. Justice CLARK and Mr. Justice HARLAN would deny certiorari on the basis of their dissent in Sanders v. United States, 373 U.S. 23, 83 S.Ct. 1081.
| 01
|
374 U.S. 424
83 S.Ct. 1759
10 L.Ed.2d 983
Agnes K. HEAD, doing business as Lea County Publishing Co., et al., Appellants,v.NEW MEXICO BOARD OF EXAMINERS IN OPTOMETRY.
No. 392.
Argued April 15 and 16, 1963.
Decided June 17, 1963.
Carol J. Head, New York City, for appellants.
Earl E. Hartley, Santa Fe, N.M., and Robert Pyatt, Gallup, N.M., for appellee.
Archibald Cox, Sol. Gen., for the United States, as amicus curiae, by special leave of Court.
Opinion of the Court by Mr. Justice STEWART, announced by Mr. Justice WHITE.
1
This case comes to us on appeal from the Supreme Court of New Mexico. One of the appellants, Agnes K. Head, owns a newspaper in Hobbs, New Mexico. The other appellant, Permian Basin Radio Corporation, owns and operates a radio station there. Hobbs is in the southeastern corner of the State, close to the Texas border, and much of the area served by both the radio station and the newspaper lies in Texas. The appellants were enjoined from accepting or publishing within the State of New Mexico a Texas optometrist's advertising found to be in violation of New Mexico law. The appellants claim that the state law, as applied, imposes an unlawful burden on interstate commerce. Permian also argues that regulation of advertising by radio has been preempted by the Communications Act of 1934.1 We noted probable jurisdiction, 371 U.S. 900, 83 S.Ct. 207, 9 L.Ed.2d 163, and invited the Solicitor General to express the Government's views concerning the question of federal preemption. We have concluded that the judgment should be affirmed.
2
Section 67—7—13 of the New Mexico Statutes Annotated deals generally with the practice of optometry. It prohibits several varieties of unauthorized practice, and forbids even licensed practitioners from employing certain sales techniques, such as house-to-house canvassing, peddling on streets or highways, or offering lenses and frames as premiums.2 It also prohibits:
3
The purpose of this provision, according to the Supreme Court of New Mexico, is to 'protect * * * citizens against the evils of price-advertising methods tending to satisfy the needs of their pocketbooks rather than the remedial requirements of their eyes.' 70 N.M. 90, 94, 370 P.2d 811, 813. Similar laws have been enacted in many States to assure high standards of professional competence.3
4
The facts stated in the complaint were not disputed. Appellants received and published advertisements from Abner Roberts, an optometrist who resided and conducted his business in the State of Texas, just a few miles east of Hobbs. In the words of the complaint, this advertising consisted of 'the quotation of prices on eyeglasses and spectacles, and of the quotation of discounts to be offered on eyeglasses and spectacles.' The appellants conceded that the advertising violated § 67—7—13(m). Finding the statute applicable and violated, the trial court enjoined each of the appellants 'from accepting or publishing within the State of New Mexico advertising of any nature from Abner Roberts which quotes prices or terms on eyeglasses * * * or which quotes moderate prices, low prices, lowest prices, guaranteed glasses, satisfaction guaranteed, or words of similar import * * *.' The Supreme Court of New Mexico affirmed, ruling that the injunction did not unlawfully burden interstate commerce and that the State's jurisdiction had not been ousted by federal legislation. 70 N.M. 90, 370 P.2d 811.
I.
5
Without doubt, the appellants' radio station and newspaper are engaged in interstate commerce, and the injunction in this case has unquestionably imposed some restraint upon that commerce. But these facts alone do not add up to an unconstitutional burden on interstate commerce. As we said in Huron Portland Cement Co. v. City of Detroit, 362 U.S. 440, 80 S.Ct. 813, 4 L.Ed.2d 852, upholding the application of a Detroit smoke abatement ordinance to ships engaged in interstate and international commerce: 'In determining whether the state has imposed an undue burden on interstate commerce, it must be borne in mind that the Constitution when 'conferring upon Congress the regulation of commerce, * * * never intended to cut the States off from legislating on all subjects relating to the health, life, and safety of their citizens, though the legislation might indirectly affect the commerce of the country. Legislation, in a great variety of ways, may affect commerce and persons engaged in it without constituting a regulation of it, within the meaning of the Constitution'. Sherlock v. Alling, 93 U.S. 99, 103, 23 L.Ed. 819; Austin v. State of Tennessee, 179 U.S. 343, 21 S.Ct. 132, 45 L.Ed. 224; Louisville & Nashville R. Co. v. Commonwealth of Kentucky, 183 U.S. 503, 22 S.Ct. 95, 46 L.Ed. 298; The Minnesota Rate Cases, Simpson v. Shepard, 230 U.S. 352, 33 S.Ct. 729, 57 L.Ed. 1511; Boston & Maine R. Co. v. Armburg, 285 U.S. 234, 52 S.Ct. 336, 76 L.Ed. 729; Collins v. American Buslines, Inc., 350 U.S. 528, 76 S.Ct. 582, 100 L.Ed. 672.' 362 U.S., at 443—444, 80 S.Ct., at L.Ed. 1511; Boston & Maine R. Co. v.
6
Like the smoke abatement ordinance in the Huron case, the statute here involved is a measure directly addressed to protection of the public health, and the statute thus falls within the most traditional concept of what is compendiously known as the police power.4 The legitimacy of state legislation in this precise area has been expressly established. Williamson v. Lee Optical Co., 348 U.S. 483, 75 S.Ct. 461, 99 L.Ed. 563. A state law may not be struck down on the mere showing that its administration affects interstate commerce in some way. 'State regulation, based on the police power, which does not discriminate against interstate commerce or operate to disrupt its required uniformity, may constitutionally stand.' Huron Portland Cement Co. v. City of Detroit, supra, 362 U.S., at 448, 80 S.Ct., at 818.
7
It has not been suggested that the statute, applicable alike to 'any person' within the State of New Mexico, discriminates against interstate commerce as such. Nor can we find that the legislation impinges upon an area of interstate commerce which by its nature requires uniformity of regulation. The appellants have pointed to no regulations of other States imposing conflicting duties, nor can we readily imagine any. Colorado Anti-Discrimination Comm'n v. Continental Air Lines, 372 U.S. 714, 83 S.Ct. 1022, 10 L.Ed.2d 84. We hold that the New Mexico statute, as applied here to prevent the publication in New Mexico of the proscribed price advertising, does not impose a constitutionally prohibited burden upon interstate commerce.5
II.
8
In dealing with the contention that New Mexico's jurisdiction to regulate radio advertising has been preempted by the Federal Communications Act, we may begin by noting that the validity of this claim cannot be judged by reference to broad statements about the 'comprehensive' nature of federal regulation under the Federal Communications Act.6 '(T)he 'question whether Congress and its commissions acting under it have so far exercised the exclusive jurisdiction that belongs to it as to exclude the State, must be answered by a judgment upon the particular case.' Statements concerning the 'exclusive jurisdiction' of Congress beg the only controversial question: whether Congress intended to make its jurisdiction exclusive.' People of State of California v. Zook, 336 U.S. 725, 731, 69 S.Ct. 841, 844, 93 L.Ed. 1005. Kelly v. State of Washington ex rel. Foss Co., 302 U.S. 1, 10—13, 58 S.Ct. 87, 82 L.Ed. 3. In areas of the law not inherently requiring national uniformity,7 our decisions are clear in requiring that state statutes, otherwise valid, must be upheld unless there is found 'such actual conflict between the two schemes of regulation that both cannot stand in the same area, (or) evidence of a congressional design to preempt the field.' Florida Lime and Avocado Growers v. Paul, 373 U.S. 132, 141, 83 S.Ct. 1210, 1217.
9
The specific provisions of the federal statute chiefly relied upon the support Permian's claim are those governing the granting, renewal, and revocation of broadcasting licenses.8 Under the broad standard of 'public interest, convenience, and necessity,' the Federal Communications Commission may consider a wide variety of factors in passing upon the fitness of an applicant. It is argued that the content of advertising is one of the factors which may be considered, and there is evidence that the Commission itself has on occasion so interpreted its authority.9 Further, the United States argues that the Commission has the authority to promulgate general regulations concerning the subject of advertising for the guidance of broadcasters. See Federal Communications Comm'n v. American Broadcasting Co., 347 U.S. 284, 289—290, 74 S.Ct. 593, 98 L.Ed. 699. This grant of federal power, it is argued, is sufficient to oust state regulation of radio advertising.
10
Assuming this to be a correct statement of the Commission's authority, we are nevertheless not persuaded that the federal legislation in this field has excluded the application of a state law of the kind here involved. The nature of the regulatory power given to the federal agency convinces us that Congress could not have intended its grant of authority to supplant all the detailed state regulation of professional advertising practices, particularly when the grant of power to the Commission was accompanied by no substantive standard other than the 'public interest, convenience, and necessity.'10 The Solicitor General has conceded that the power of license revocation is not a plausible substitute for state law dealing with 'traditional' torts or crimes committed through the use of radio. We can find no material difference with respect to the less 'traditional' statutory violation here involved. In the absence of positive evidence of legislative intent to the contrary, we cannot believe Congress has ousted the States from an area of such fundamentally local concern.
11
Finally, there has been no showing of any conflict between this state law and the federal regulatory system, or that the state law stands as an obstacle to the full effectiveness of the federal statute. No specific federal regulations even remotely in conflict with the New Mexico law have been called to our attention. The Commission itself has apparently viewed state regulation of advertising as complementing its regulatory function, rather than in any way conflicting with it.11 As in Colorado Anti-Discrimination Comm'n v. Continental Air Lines, Inc., 372 U.S. 714, at 724, 83 S.Ct. 1022, at 1027, we are satisfied that the state statute 'at least so long as any power the (Commission) may have remains 'dormant and unexercised,' will not frustrate any part of the purpose of the federal legislation.'12
12
Affirmed.
13
Mr. Justice DOUGLAS concurs in the result.
14
Mr. Justice BRENNAN (concurring).
15
I agree that the attack on the New Mexico statute as an unreasonable burden on interstate commerce has no merit and therefore join Part I of the Court's opinion. The attack based on the Supremacy Clause—the contention that the Federal Communications Act preempts the subject matter of this state regulation—is not, however, so easily answered. Although I conclude that it too cannot prevail, I think it is appropriate that I state separately my reasons for reaching that result. For only recently we held, in Farmers Educational & Cooperative Union, etc. v. WDAY, Inc., 360 U.S. 525, 79 S.Ct. 1302, 3 L.Ed.2d 1407, that the Communications Act displaced the state law of defamation insofar as that law directly conflicted with the 'equal time' aims of § 315. Cf. Radio Station WOW, Inc., v. Johnson, 326 U.S. 120, 65 S.Ct. 1475, 89 L.Ed. 2092; Allen B. Dumont Laboratories v. Carroll, 3 Cir., 184 F.2d 153. What reasons arise from the relevant state and federal legislation governing advertising which require a different conclusion in this case?
I.
16
I agree that, as the Court says, the New Mexico statute is not displaced by the FCC's powers 'governing the granting, renewal, and revocation of broadcasting licenses.' If that were the only sanction which the Commission might apply to the advertising practices which the New Mexico statute forbids, the basis for any claim of the federal statute's preemptive effect would be removed. For the Commission has long disclaimed the effectiveness of attempting to police minor deviations and indiscretions in programming and advertising by the use of 'the cumbersome weapons of criminal penalties and license refusal and revocation.' Regents of the University System of Georgia v. Carroll, 338 U.S. 586, 602, 70 S.Ct. 370, 378, 94 L.Ed. 363.1 This obstacle led the Congress in 1960, on the recommendations of the Commission and the Attorney General,2 to amend the Communications Act to authorize the Commission to impose money forfeitures, 47 U.S.C. § 503(b), and to grant short-term licenses, 47 U.S.C. § 307(d). The amendments also strengthened the Commission's preexisting power to issue cease-and-desist orders, 47 U.S.C. § 312(b). The Commission was thus expressly given more discriminating tools 'in dealing with violations in situations where revocation or suspension does not appear to be appropriate.'3
17
The Commission has been prompt to apply its new sanctions. Some stations 'whose violation records indicated need for closer supervision' have been limited to short-term licenses.4 Forfeitures have been imposed for 'violations that do not warrant revocation proceedings';5 and cease-and-desist orders have been issued for the first time in broadcast cases.6 Thus infractions which would heretofore have gone formally unregulated are apparently now being dealt with because the Commission may impose sanctions more commensurate with the gravity of the offense.
18
This is not to say that before the 1960 amendments the Commission never found the cancellation power useful in curbing some abuses now policed under the less drastic sanctions. Indeed, the Commission's informal policing of minor complaints had some success precisely because the 'death sentence' could be imposed. 'The licensing power of the FCC,' one commentator has said, 'hangs like a constant Damocles' sword over broadcasting.'7 The Commission regularly reported to Congress that a great number of complaints about programming or advertising were readily resolved by 'informal adjustment,' without need for recourse to formal hearings, much less to revocation proceedings.8 The Commission, it appears, though sparingly invoking the cancellation power, had 'powerful informal sanctions working in its favor, for the constant theoretical threat of license revocation at renewal time is always present * * *. (I)f a complaint arises in the programming field that accuses a station of violating FCC standards the mere notification of the respondent of the fact of the complaint would result in immediate settlement in many cases.'9
19
It seems to me, then, that a conclusion of nondisplacement of the state statute at bar by the Federal Communications Act can rest neither upon the practical inability of the FCC to police those practices which the State has forbidden, nor upon any want of authority in the Commission to regulate the subject matter of the New Mexico statute. Actually, the Commission has concerned itself with the content of radio advertising almost from the time that federal regulation of commercial broadcasting began. Advertising abuses in the early days of radio were a constant source of embarrassment and concern to the Commission and its predecessor, the Federal Radio Commission.10 One of the principal abuses complained of was the very aspect of commercial sponsorship with which the New Mexico statute is concerned—'direct' or price advertising. The First Annual Radio Conference, meeting in 1922 at the invitation of Secretary Hoover, strongly recommended 'that direct advertising in radio broadcasting service be absolutely prohibited * * *.'11 At least one station lost its license during the '20's because, among other abuses, it had indulged excessively in 'direct advertising, including the quoting of prices.'12 And until the passage of the Communications Act in 1934, members of the Commission and of Congress continued to hope that broadcasting free of all commercials—or at least devoid of direct advertising, one form of sponsorship particularly objected to—might become a commercial reality.13 Even representatives of the industry shared this hope for a time.14
20
The advent of the 1930's apparently foreclosed the possibility of radio without commercials, and the Commission shifted its attention to a more discriminating appraisal of the content of advertising over the air. As early as 1928, for example, the General Counsel of the Radio Commission held that abuses in network cigarette advertising—while not a sufficient basis for revocation proceedings against an individual licensee-might on renewal militate against the requisite finding of broadcasting in 'the public interest.'15 During the mid-1930's, moreover, the Commission repeatedly warned that advertising excesses and the use of commercial material offensive to the listening public might constitute grounds for the cancellation of a license.16 However, no license appears to have been withdrawn solely for that reason. Rather, the possibility of cancellation seems to have been employed as a threat, and an effective one, for the Commission continued to report its satisfaction that many complaints of this nature were settled through the use of warnings and other informal sanctions outside the formal administrative machinery. Recourse to these informal solutions seems to have been extensive at least until 1940.
21
Since World War II, however, the Commission has apparently followed a policy which puts less emphasis upon regulation of the content and quality of commercials. In its 1946 'Blue Book,' the Commission, although cataloguing various advertising abuses, including several which directly involved content, expressly disavowed any intention to regulate directly 'advertising excesses other than an excessive ratio of advertising time to program time * * *.'17 The 'Blue Book' stated, regarding the other forms of abuse: 'The Commission has no desire to concern itself with the particular length, content, or irritating qualities of particular commercial plugs.'18 There are more recent sings of renewed attention to the subject of advertising content, but nothing appears to approach the pervasive superintendence of the 1930's.19 In any event the FCC has seemed content to leave to the Federal Trade Commission the regulation of much of the field, particularly the policing of false, misleading or deceptive advertising designed for radio and television broadcast. While the FCC has consistently warned its licensees that the continued broadcasting of material found by the FTC to be deceptive or misleading 'would raise serious questions as to whether such stations are operating in the public interest,' its policy seems to have been to leave the matter of direct and immediate sanctions largely to the Trade Commission.20
II.
22
It is against this pattern of federal regulation that we must apply in this case the settled tests by which we determine whether federal legislation has displaced state regulation of a given subject matter. Under the first test the subject matter, here radio and television broadcasting, is clearly not one 'by its very nature admitting only of national supervision * * *.' Florida Lime & Avocado Growers, Inc., v. Paul, 373 U.S. 132, 143, 83 S.Ct. 1210, 1218. Nothing in our decisions which have required particular state regulations to yield to the Communications Act suggests such a view of the regulatory field. Cf. Farmers Educational & Co-operative Union, etc. v. WDAY, Inc., supra. Although in Radio Station WOW, Inc., v. Johnson, supra, 326 U.S., at 131—132, 65 S.Ct., at 1482, we decreed the displacement of state law in some respects, we recognized that state regulation in other respects might be constitutional.
23
The second test, whether there is evidence of congressional intent exclusively to occupy the field, is apposite but the requisite evidence is lacking. We have said, to be sure, that '(n)o state lines divide the radio waves, and national regulation is not only appropriate but essential to the efficient use of radio facilities.' Federal Radio Comm'n v. Nelson Bros. Bond & Mortgage Co., 289 U.S. 266, 279, 53 S.Ct. 627, 633, 77 L.Ed. 1166. But that language should not be read as construing the Communications Act to mandate the ouster of all local regulation the application of which might in any way prevent perfect national uniformity.21 Indeed, even the Solicitor General, in his brief as amicus curiae, concedes as much by his recognition that Congress intended the survival of certain 'traditional' state powers and remedies—particularly common-law tort and traditional criminal sanctions.
24
Rather than mandate ouster of state regulations, several provisions of the Communications Act suggest a congressional design to leave standing various forms of state regulation, including the form embodied in the New Mexico statute. First, the Act contains a 'saving clause,' 47 U.S.C. § 414, providing that 'Nothing in this chapter contained shall in any way abridge or alter the remedies now existing at common law or by statute, but the provisions of this chapter are in addition to such remedies.' Of course such a general provision does not resolve specific problems, Arrow Transportation Co. v. Southern R. Co., 372 U.S. 658, 671, n. 22, 83 S.Ct. 984, 991, 10 L.Ed.2d 52, but its inclusion in the statute plainly is inconsistent with congressional displacement of the state statute unless a finding of that meaning is unavoidable.22 Second, the statutory regulation of radio and television broadcasting is far less comprehensive than the regulation in the very same title of telephone and telegraph facilities, Federal Communications Comm'n v. Sanders Bros. Radio Station, 309 U.S. 470, 474, 60 S.Ct. 693, 84 L.Ed. 869—yet even as to those means of communications some subjects and remedies are saved to state regulation. Finally, Congress has enacted detailed regulations of some broadcasting practices (not including that regulated by the New Mexico statute)—e.g., the manner in which sponsorship must be identified and announced, 47 U.S.C. § 317; the uttering of any 'obscene, indecent, or profane language' over the air, 18 U.S.C. § 1464; and the transmission of communications known to contain fraudulent matter, 18 U.S.C. § 1343; cf. 47 U.S.C. § 509. While the failure expressly to regulate nondeceptive advertising surely does not deprive the FCC of all such jurisdiction, that failure argues against a congressional design that state regulation was to be ousted. Cf. Federal Communications Comm'n v. American Broadcasting Co., 347 U.S. 284, 74 S.Ct. 593, 98 L.Ed. 699.
25
This brings me to the third test—whether as a practical matter 'both regulations can be enforced without impairing the federal superintendence of the field * * *.' Florida Lime & Avocado Growers, Inc., v. Paul, supra, 373 U.S., at 142, 83 S.Ct., at 1217. It is the application of this criterion which reveals the basic difference between this case and WDAY. We held there that the strong federal interest represented by the 'equal time' obligation which § 315 imposes upon broadcasters with respect to political candidates would be frustrated if not altogether defeated by the survival of state remedies against the broadcaster for allegedly defamatory political broadcasts. Thus the conflict in operation between the federal and state laws which converged in that case made it inevitable that the state law should yield in the interests of a particular federal regulatory scheme.
26
The instant case, by contrast, presents no such conflict or dissonance. The New Mexico law is one designed principally to protect the State's consumers against a local evil by local application to forbid certain forms of advertising in all mass media. Such legislation, whether concerned with the health and safety of consumers, or with their protection against fraud and deception, embodies a traditional state interest of the sort which our decisions have consistently respected. Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146, 1152, 91 L.Ed. 1447. Nor is such legislation required to yield simply because it may in some degree restrict the activities of one who holds a federal license. Cf. Huron Portland Cement Co. v. Detroit, 362 U.S. 440, 447—448, 80 S.Ct. 813, 818, 4 L.Ed.2d 852.
27
A conclusion that the state regulation is ousted by the federal requires, under this third test, a showing of conflict either in purpose or in operation between the state and federal regulations involved. The contrary of such a showing is made here, for the FCC, in determining whether a licensee's operation has served the public interest, considers whether he has complied with state and local regulations governing advertising23—in other words, the Commission accords important deference to the continued operation of state law in this field. Moreover, the National Association of Broadcasters has also consistently counseled obedience to state law on such matters. The Association, in its extensive Codes of Good Practices for both radio and television, unmistakably enjoins each member to 'refuse the facilities of his station to an advertiser where he has good reason to doubt the integrity of the advertiser, the truth of the advertising representations, or the compliance of the advertiser with the spirit and purpose of all applicable legal requirements';24 the Television Code, moreover, expressly enjoins: 'Diligence should be exercised to the end that advertising copy accepted * * * complies with pertinent Federal, state and local laws.'25
28
Finally, a practical consideration militates strongly against giving the federal statute preemptive effect in the absence of a clear congressional mandate. Even if the FCC is generally able and willing to regulate advertising abuses, the agency would understandably desire to share with state agencies the responsibility for policing the myriad local and occasional violations of the canons of advertising. Otherwise the burden might well become so heavy as to produce a 'no-man's land,' cf. Guss v. Utah Labor Relations Board, 353 U.S. 1, 77 S.Ct. 598, 609, 1 L.Ed.2d 601, in which there would be at best selective policing of the various advertising abuses and excesses which are now very extensively regulated by state law.26 That could only mean a partial exemption of radio and television, alone among the media, from local regulations and a denial of the protection which consumers rightly expect from government.27
III.
29
Our holding today intimates no view of the constitutionality of several other superficially similar forms of state regulation of broadcasting. First, nothing here said suggests that a system of state regulation, although not in direct conflict with federal law, would pass muster if it were so pervasive and so burdensome upon broadcasters as to interfere substantially with the overall purposes of federal regulation. Cf. Allen B. Dumont Laboratories v. Carroll, supra. Second, nothing said answers the problem of the situation, factually closer to that at bar but legally quite distinct, which would be presented if a State in which nationwide network material originates sought to restrict network advertising under a statute enacted for the protection only of that State's consumers. Such regulation might well exceed the scope of the State's legitimate interests and involve a constitutionally illegitimate attempt to control communications beyond its borders. Cf. Bibb v. Navajo Freight Lines, Inc., 359 U.S. 520, 79 S.Ct. 962, 3 L.Ed.2d 1003; Southern Pacific Co. v. Arizona ex rel. Sullivan, 325 U.S. 761, 775, 65 S.Ct. 1515, 1523, 89 L.Ed. 1915. Third, nothing said here may be read to sustain the constitutionality of applications of local advertising regulations which threaten to make it impossible for a local station to transmit network broadcasts because of their sponsorship.28 While the State's interests might be no different from that protected by this New Mexico statute, the more drastic effect of the regulation upon the exercise of the broadcaster's federal license and his access to network material might well require a different result. All that the Court decides today is that this New Mexico statute may constitutionally be enforced against radio broadcasters equally with other news media doing business in New Mexico.
1
48 Stat. 1064, as amended, 47 U.S.C. § 151 et seq.
2
'(i) Either in person or by or through solicitors or agents giving or offering to give to any person eyeglasses, spectacles or lenses, either with or without frames or mountings, as a premium or inducement for any subscription to any book, set of books, magazines, magazine, periodical or other publication, or as a premium or inducement for the purchase of any goods, wares or merchandise.
'(k) The making of a house to house canvass either in person or through solicitors or associates for the purpose of selling, advertising or soliciting the sale of eyeglasses, spectacles, lenses, frames, mountings, eye examinations or optometrical services.
'(l) The peddling of eyeglasses, spectacles or lenses from house to house or on the streets or highways, notwithstanding any law for the licensing of peddlers.'
'(m) Advertising by any means whatsoever the quotation of any prices or terms on eyeglasses, spectacles, lenses, frames or mountings, or which quotes discount to be offered on eyeglasses, spectacles, lenses, frames or mountings or which quotes 'moderate prices,' 'low prices,' 'lowest prices,' 'guaranteed glasses,' 'satisfaction guaranteed,' or words of similar import.'
3
See Ark.Stat.Ann. § 72—815 (1957 Replacement); Cal.Bus. & Professions Code, § 3129; Del.Code Ann., Tit. 24, § 2113; Fla.Stat.Ann. §§ 463.11, 463.14; Hawaii Rev.Laws § 68—9(d) (1960 Supp.); Ind.Stat.Ann. §§ 63—1018a(e), 63—1019(f) (1961); Ky.Rev.Stat. § 320.300; La.Rev.Stat. § 37:1063; Mich.Stat.Ann. § 14.648(i) (1961 Supp.), Comp.Laws 1948, § 338.258; Minn.Stat.Ann. § 148.57(3); Mo.Ann.Stat. § 336.110; Mont.Rev.Codes § 66—1302(11); Neb.Rev.Stat. § 71—148; Nev.Rev.Stat. § 636:300(10); N.J.Stat.Ann. § 45:12—11(h) (1962 Supp.); N.C.Gen.Stat. § 90—124(9); N.Dak.Cent.Code § 43—13—29; Okla.Stat.Ann., Tit. 59, § 943; Ore.Rev.Stat. § 683.140(6); Pa.Stat.Ann., Tit. 63, § 237; R.I.Gen.Laws § 5—35—22; S.C.Code of Laws § 56—1075; S.Dak.Code § 27.0707(6) (1960 Supp.); Tenn.Code Ann. § 63—815; Va.Code § 54 388, par. 2(d); Wash.Rev.Code Ann. § 18.53.140; W.Va.Code § 2937 (1961); Wis.Stat.Ann. § 153.10.
4
The case is not one, therefore, in which the State seeks to justify a statute as a health measure on the attenuated theory that the economic well-being of a profession or industry will assure better performance in the public interest. See Baldwin v. G. A. F. Seelig, Inc., 294 U.S. 511, 522—523, 55 S.Ct. 497, 79 L.Ed. 1032. Compare Semler v. Oregon State Board of Dental Examiners, 294 U.S. 608, 55 S.Ct. 570, 79 L.Ed. 1086.
5
The appellants have argued that the decree below will have the effect of preventing communication between the Texas optometrist and Texas residents. A similar argument was rejected in Railway Express Agency v. People of State of New York, 336 U.S. 106, 69 S.Ct. 463, 93 L.Ed. 533, which held valid a local ordinance prohibiting the display of advertising on trucks which also operated in other States.
6
E.g., National Broadcasting Co. v. United States, 319 U.S. 190, 213, 63 S.Ct. 997, 1008, 87 L.Ed. 1344 ('wide licensing and regulatory powers'), id., at 217, 63 S.Ct., at 1010 ('comprehensive powers to promote and realize the vast potentialities of radio'); Federal Communications Comm'n v. Pottsville Broadcasting Co., 309 U.S. 134, 137, 60 S.Ct. 437, 439, 84 L.Ed. 656 ('unified and comprehensive regulatory system for the industry').
It is to be noted that this case in no way involves the Commission's jurisdiction over technical matters such as a frequency allocation, over which federal control is clearly exclusive. 47 U.S.C. § 301.
7
See Hines v. Davidowitz, 312 U.S. 52, 61 S.Ct. 399, 85 L.Ed. 581.
8
See 47 U.S.C. §§ 303(j), 307(a), (d), 308(a), 309(a), and 312.
9
We have been cited to specific instances in which the content of advertising analogous to that involved in this case has been considered. See, e.g., Farmers & Bankers Life Ins. Co., 2 F.C.C. 455; WSBC, Inc., 2 F.C.C. 293; Oak Leaves Broadcasting Station, Inc., 2 F.C.C. 298. And see KFKB Broadcasting Ass'n v. Federal Radio Comm'n, 60 App.D.C. 79, 47 F.2d 670.
10
See Interstate Commerce Comm'n v. U.S. ex rel. Los Angeles, 280 U.S. 52, 68—70, 50 S.Ct. 53, 56, 74 L.Ed. 163. Compare Allen B. Dumont Laboratories v. Carroll, 3 Cir., 184 F.2d 153, which held state censorship of motion pictures shown on television preempted by those provisions of the federal act expressly dealing with 'communications containing profane or obscene words, language, or meaning.' 47 U.S.C. § 303(m)(1)(D).
11
Our attention has been directed to the following statement of Commission policy:
'In those localities and states where the sale of alcoholic beverages is prohibited by local or state statutes, such advertising by radio in those areas would, of course, not be in the public interest, since adherence to the laws of the state in which a station is located, especially laws expressive of the public policy of the state or locality on subjects relative to health, safety, and morals, is an important aspect of operation in the public interest. Obviously, the same is true with respect to those areas where advertising of alcoholic beverages is prohibited by law.' F.C.C. Letter to Sen. Edwin C. Johnson, Chairman of the Senate Committee on Interstate and Foreign Commerce, August 11, 1949, 5 Pike & Fischer Radio Reg., 593—594.
12
The appellants urge three additional grounds for reversal. Each may be disposed of briefly. First, both appellants urge that the state statute deprives them of property, in violation of the Due Process Clause. That claim is foreclosed by Williamson v. Lee Optical Co., 348 U.S. 483, 75 S.Ct. 461, 99 L.Ed. 563. See also Ferguson v. Skrupa, 372 U.S. 726, 83 S.Ct. 1028, 10 L.Ed.2d 93. The appellant Head claims that denial of her right to do business with Abner Roberts is a violation of her privileges and immunities of national citizenship. But the Privileges and Immunities Clause of the Fourteenth Amendment does not create a naked right to conduct a business free of otherwise valid state regulation. Madden v. Commonwealth of Kentucky, 309 U.S. 83, 92—93, 60 S.Ct. 406, 410, 84 L.Ed. 590. Finally, it is contended that the injunction constitutes an invalid restraint upon freedom of speech protected by the Fourteenth Amendment. This argument was not made to the state courts, nor was it reserved in the notice of appeal to this Court. Under Rule 10, par. 2, of the Rules of this Court, 'Only the questions set forth in the notice of appeal or fairly comprised therein will be considered by the court.' See also Rule 15, par. 1(c)(1).
1
See H.R.Rep. No. 1800, 86th Cong., 2d Sess. 16 U.S.Code Cong. & Adm.News, 1960, p. 3516 ('The principal administrative sanctions which the FCC is presently authorized to invoke against licensees who flout the law are license revocation and cease and desist orders. Revocation, of course, amounts to a death sentence for the licensee. It may also have a serious effect upon the community served by the licensee. Because of its severity, it has seldom if ever been invoked.'). See also, e.g., Smead, Freedom of Speech by Radio and Television (1959), 3; Note, State Regulation of Radio and Television, 73 Harv.L.Rev. 386, 390 (1959); Note, Broadcast Licensee's Past Conduct as a Determinant of the Public Interest, 23 U. of Pitt.L.Rev. 157, 160 (1961). The comment of one author is particularly apposite to the question of this case: 'The great reluctance of the Commission to exercise its power of revocation, its lack of power to suspend licenses and its recognition of the importance of commercial advertising to radio broadcasting, make it customary for broadcast advertising to be considered by the Commission only on applications for renewal of station licenses.' 2 Socolow, The Law of Radio Broadcasting (1939), 1005.
Not only was the drastic nature of the 'death sentence' a deterrent to its application against lesser violations—in addition, it was suggested that licensing controls constituted at best only indirect regulation of the parties primarily at fault in cases of advertising excesses or abuses—the networks and the sponsors themselves—and were therefore inequitable as well as unduly harsh. See Deceptive Practices in the Broadcasting Media, December 30, 1959, 19 Pike & Fischer Radio Reg. 1901, 1918; Note, The Regulation of Advertising, 56 Col.L.Rev. 1018, 1049 (1956).
2
The Attorney General, in his letter to the President, summarized his recommendation as follows:
'Second, as a practical matter, the one sanction expressly conferred by statute upon the Federal Communications Commission for use against a broadcast licensee who fails to operate in the public interest is to withdraw his broadcasting license permanently—a sanction so severe that it has been imposed only rarely. The Federal Communications Commission should be expressly authorized also to impose less severe sanctions for actions violating the Communications Act or regulations issued pursuant to it. Such sanctions, for example, could include temporary suspension or conditional licenses.' Deceptive Practices in the Broadcasting Media, Report to the President by the Attorney General, December 30, 1959, 19 Pike & Fischer Radio Reg. 1901, 1905. See also, for the Commission's view prior to 1960, Hearings before a Subcommittee of the Senate Committee on Interstate and Foreign Commerce on S. 1333, 80th Cong., 1st Sess. 14, 51.
3
H.R.Rep. No. 1800, 86th Cong., 2d Sess. 17; see also S.Rep. No. 1857, 86th Cong., 2d Sess. 4, 8—10. In addition to the three sanctions provided by the Communications Act amendments of 1960, the House bill had also originally provided for a Commission power to suspend licenses for minor violations, for periods not to exceed 10 days. The Senate Committee, however, recommended against the provision for suspension, and it was dropped from the final bill. See generally, concerning the scope and provisions of the 1960 amendments, Enforcement Provisions of the Communications Act, 18 Fed. Communications B.J. 45 (1963).
4
See 28 F.C.C.Ann.Rep. 47—48 (1962); New York Times, July 14, 1961, p. 37, col. 2. Although under the Communications Act of 1934 the Commission presumably possessed the power to issue licenses for terms shorter than the statutory maximum, a formal rule provided that maximum-period licenses would be regularly granted. The purpose of the amendment was, therefore, simply to reaffirm the existence of the power to issue licenses for less than the statutory three-year maximum. See H.R.Rep. No. 1800, 86th Cong., 2d Sess. 8—9.
5
See 28 F.C.C.Ann.Rep. 46—47 (1962). At least one of the forfeiture proceedings reported by the Commission in its most recent report concerned the advertising practices of a licensee, who paid a forfeiture of $50,000. See id., at 54.
6
See 27 F.C.C.Ann.Rep. 37, 40 (1961). Although provision was made for cease-and-desist orders in 1952, see 66 Stat. 717, until the 1960 amendment this sanction was invoked only in cases involving technical violations.
7
Schwartz, Antitrust and the FCC: The Problem of Network Dominance, 107 U. of Pa.L.Rev. 753, 769 (1959).
8
See 2 F.C.C.Ann.Rep. 19 (1936); 4 F.C.C.Ann.Rep. 69 (1938); 7 F.C.C.Ann.Rep. 27 (1941); Smead, Freedom of Speech by Radio and Television (1959), 30 and n. 63; Note, The Regulation of Advertising, 56 Col.L.Rev. 1018, 1048 (1956). One author has suggested that '(t)he net result has been regulation of programming by raised eyebrow.' Note, Broadcast Licensee's Past Conduct as a Determinant of the Public Interest, 23 U. of Pitt.L.Rev. 157, 170 (1961). It has also been noted that speeches and informal statements by individual Commissioners have often had significant impact upon programming and other activities of licensees. Note, Television Programming, Communication Research, and the FCC, 23 U. of Pitt.L.Rev. 993, 996 (1962).
9
Woll, Administrative Law: The Informal Process (1963), 139.
10
See Emery, Broadcasting and Government: Responsibilities and Regulations (1961), 11—13; Moser and Lavine, Radio and the Law (1947), §§ 42, 43; Perry, Weak Spots in the American System of Broadcasting, 177 Annals Am.Acad.Pol. & Soc.Sci. 22, 24—25 (1935).
11
Quoted in Federal Communications Commission, Public Service Responsibility of Broadcast Licensees (1946), 41.
12
Ibid. The Commission explained its refusal to prohibit all direct advertising as follows: 'The Commission is not fully convinced that it has heard both side of the matter, but is willing to concede that in some localities the quoting of direct merchandise prices may serve as a sort of local market, and in that community a service may thus be rendered. That such is not the case generally, however, the commission knows from thousands and thousands of letters which it has had from all over the country complaining of such practices.' 2 F.R.C.Ann.Rep. 168—169 (1928).
13
See, e.g., Hearings before Senate Committee on Interstate Commerce on S. 6, 71st Cong., 1st Sess., pt. 5, p. 192; id., pt. 6, p. 230. One may only speculate what might have been the course of American broadcasting had such a prohibition been imposed. For recent difficulties which Sweden has experienced under a general ban on radio advertising, see New York Times, April 2, 1961, p. 1, col. 3; id., April 3, 1961, p. 8, col. 4.
14
Hearings before Senate Committee on Interstate Commerce on S. 6, 71st Cong., 2d Sess., pt. 13, pp. 1705—1706. Compare Durstine, The Future of Radio Advertising in the United States, 177 Annals Am.Acad.Pol. & Soc.Sci. 147, 149 (1935).
15
Opinion No. 32, 1928—1929 Opinions of the General Counsel, Federal Radio Commission, 77, 81—82. The General Counsel also rejected the contention that such consideration of a licensee's past advertising practices might amount to censorship, partly on the ground of a 'necessary distinction between restrictions placed upon the transmission of intelligence for which there is a general public demand and need and limitations imposed upon broadcasting propaganda, intended to obtain commercial success, for which there is no such demand or need.' Id., at 81.
Shortly after the issuance of the General Counsel's opinion, the Chairman of the Federal Radio Commission was asked by Senator Dill during his appearance before the Senate Commerce Committee whether he thought the Commission had sufficient power 'through its power of regulation and its determination of public interest to handle objectionable advertising.' The Chairman replied, 'I think so, Senator Dill, because we have had little trouble about it, even without direct power. We have been able to improve some programs.' Hearings before Senate Committee on Interstate Commerce on S. 6, 71st Cong., 1st Sess., pt. 6, p. 230.
16
See, e.g., Knickerbocker Broadcasting Co., 2 F.C.C. 76; WSBC, Inc., 2 F.C.C. 293; Hammond-Calumet Broadcasting Corp., 2 F.C.C. 321; Oak Leaves Broadcasting Station, Inc., 2 F.C.C. 298; Farmers & Bankers Life Ins. Co., 2 F.C.C. 455. In Ben S. McGlashan, 2 F.C.C. 145, 152, the Commission dismissed as 'manifestly contrary to the law' the suggestion that 'licensees should not have the duty of examining into the propriety of advertising to be broadcast * * *.' Cf. KFKB Broadcasting Ass'n, Inc., v. Federal Radio Comm'n, 60 App.D.C. 79, 47 F.2d 670. See generally Moser and Lavine, Radio and the Law (1947), § 43; Note, Governmental Regulation of the Program Content of Television Broadcasting, 19 Geo.Wash.L.Rev. 312, 317 (1951).
17
Federal Communications Commission, Public Service Responsibility of Broadcast Licensees (1946), 47.
18
Id., at 56.
19
See, e.g., WREC Broadcasting Service, 10 Pike & Fischer Radio Reg. 1323, 1350—1351, 1358—1359; Liberty Television, Inc., 30 F.C.C. 411, 414; 28 F.C.C.Ann.Rep. 54—55 (1962). Cf. Public Notice, 'Double Billing' Practices, March, 7, 1962, 23 Pike & Fischer Radio Reg. 175; Sam Morris, 11 F.C.C. 197; Hale and Hale, Competition or Control II: Radio and Television Broadcasting, 107 U. of Pa.L.Rev. 585, 603—607 (1959).
20
Liaison Between FCC and FTC Relating to False and Misleading Radio and TV Advertising, Feb. 21, 1957, 14 Pike & Fischer Radio Reg. 1262.
The Trade Commission first assumed responsibility for radio advertising in 1934, see 2 Socolow, The Law of Radio Broadcasting (1939), §§ 540—542; Davis, Regulation of Radio Advertising, 177 Annals Am.Acad.Pol. & Soc.Sci. 154, 156—157 (1935). The FCC also instituted during the 1930's a policy of referring misleading and deceptive advertising complaints to the Trade Commission. See 6 F.C.C.Ann.Rep. 55 (1940); 7 F.C.C.Ann.Rep. 27 (1941). Since 1957 there has been a particularly close liaison between the two agencies with respect to advertising matters, see Deceptive Practices in the Broadcasting Media, 19 Pike & Fischer Radio Reg. 1901, 1923; 27 F.C.C.Ann.Rep. 40 (1961). The FCC has also announced a policy of keeping its licensees informed of applicable rulings of the Trade Commission, 28 F.C.C.Ann.Rep. 44 (1962). For surveys of the Trade Commission's present regulation of radio and television advertising, see generally Emery,
Broadcasting and Government: Responsibilities and Regulations (1961), 58—65; Smead, Freedom of Speech by Radio and Television (1959), 31—33; 37 Notre Dame Law. 524 (1962); 36 St. John's L.Rev. 274 (1962); 10 U.C.L.A.L.Rev. 417 (1963).
In view of the activity of the Federal Trade Commission in matters of radio and television advertising, it might be argued that the Supremacy Clause question should be judged by the powers and sanctions of that agency instead of by those of the FCC. Several answers may be made to that suggestion. First, the remedial powers of the Trade Commission are only very rarely accorded preemptive effect, e.g., Bedno v. Fast, 6 Wis.2d 471, 95 N.W.2d 396. Second, broadcasters and publishers are expressly exempted from the criminal penalties against false and deceptive advertising, 15 U.S.C. § 54(b). Thus, FTC regulation of advertising over the air tends to be indirect, the sanctions being imposed upon the sponsor, and, occasionally, upon the advertising agency. See, e.g., Colgate-Palmolive Co. v. Federal Trade Comm'n, 1 Cir., 310 F.2d 89. Third, it appears that the FTC is neither equipped for nor desirous of assuming exclusive responsibility for essentially local advertising abuses, particularly where the state regulation complements the federal prohibitions. See Comment, State Control of Bait Advertising, 69 Yale L.J. 830, 845—846 (1960). Finally, federal preemption would threaten to disrupt unduly the existing schemes of state and local regulation of advertising in an area in which no overriding need for federal uniformity appears, Note, The Regulation of Advertising, 56 Col.L.Rev. 1018, 1076 (1956), and in which there may even be some doubt as to the FTC's jurisdiction, see 29 Geo.Wash.L.Rev. 808, 811—813 (1961).
21
Compare, e.g., Kroeger v. Stahl, 3 Cir., 248 F.2d 121, with, e.g., Western Union Telegraph Co. v. State, 207 Ga. 675, 63 S.E.2d 878; National Broadcasting Co. v. Board of Public Utility Com'rs, D.C., 25 F.Supp. 761; RCA Communications, Inc. v. Patchogue Broadcasting Co., Inc., 19 Pike & Fischer Radio Reg. 2071. See generally Emery, Broadcasting and Government: Responsibilities and Regulations (1961), 72—73; Note, State Regulation of Radio Lotteries, 1952 Wis.L.Rev. 177, 180—181.
22
See Note, State Regulation of Radio and Television, 73 Harv.L.Rev. 386, 387—388 (1959); Note, Governmental Regulation of the Program Content of Television Broadcasting, 19 Geo.Wash.L.Rev. 312, 322—323 (1951).
23
See Letter of Acting Chairman Paul A. Walker to Senator Edwin C. Johnson, August 11, 1949, 5 Pike & Fischer Radio Reg. 593, 594.
24
Quoted in Emery, Broadcasting and Government: Responsibilities and Regulations (1961), 430, 445.
25
Id., at 445.
26
See generally Moser and Lavine, Radio and the Law (1947), c. V; Note, State Regulation of Radio Lotteries, 1952 Wis.L.Rev. 177; State Legislation Affecting Radio and Television, 1951—1952, 12 Fed. Communications B.J. 261 (1952); Note, State Control of Bait Advertising, 69 Yale L.J. 830 (1960).
27
This is not to suggest that a statute which formally exempted certain media from penalties upon certain types of advertising would necessarily represent any violation of the Equal Protection Clause. See Packer Corp. v. Utah, 285 U.S. 105, 108 110, 52 S.Ct. 273, 274, 76 L.Ed. 643. Cf. Calif.Bus. & Prof.Code § 17502, which was amended in 1951 to exempt from the prohibitions against false and deceptive advertising a newspaper or radio station which 'broadcasts or publishes an advertisement in good faith, without knowledge of its false, deceptive, or misleading character.'
28
See Note, State Regulation of Radio and Television, 73 Harv.L.Rev. 386, 393—395 (1959).
| 910
|
374 U.S. 498
83 S.Ct. 1876
10 L.Ed.2d 1044
Howard Tempy DEARHART, Jr.v.VIRGINIA.
No. 48, Misc.
Supreme Court of the United States
June 17, 1963
Howard Tempy Dearhart, Jr., pro se.
Reno S. Harp III, Asst. Atty. Gen., of Virginia, for respondent.
On Petition for Writ of Certiorari to the Supreme Court of Appeals of Virginia.
PER CURIAM.
1
The motion for leave to proceed in forma pauperis and the petition for writ of certiorari are granted. The judgment is vacated and the case is remanded for further consideration in light of Douglas v. California, 372 U.S. 353, 83 S.Ct. 814, 9 L.Ed.2d 811.
2
Mr. Justice CLARK and Mr. Justice HARLAN dissent for the reasons stated in their dissenting opinions in Douglas v. California, 372 U.S. 358, 360, 83 S.Ct. 817, 818.
| 12
|
374 U.S. 150
83 S.Ct. 1850
10 L.Ed.2d 805
UNITED STATES, Petitioner,v.Carlos MUNIZ and Henry Winston.
No. 464.
Argued April 22 and 23, 1963.
Decided June 17, 1963.
J. William Doolittle, Washington, D.C., for petitioner.
John J. Abt and Richard D. Friedman, New York City, for respondents.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
The question in this case is whether a person can sue under the Federal Tort Claims Act1 to recover damages from the United States Government for personal injuries sustained during confinement in a federal prison, by reason of the negligence of a government employee. For reasons to be developed below, we hold that such suits are within the purview of the Act.
2
This litigation, brought here by the Government as a single case, arises from two separate suits for personal injuries brought by respondents Henry Winston and Carlos Muniz in the United States District Court for the Southern District of New York. Both sought damages for personal injuries suffered while they were confined in federal prisons. The district judge granted the Government's motions to dismiss in both cases on the ground that such suits were not permitted by the Federal Tort Claims Act. The Court of Appeals for the Second Circuit, sitting en banc, reversed, four judges dissenting. 305 F.2d 264, 287.2 Because the decision below involves an important question in the construction of the Federal Tort Claims Act and because two Courts of Appeals had previously reached a contrary result,3 we granted certiorari. 371 U.S. 919, 83 S.Ct. 292, 9 L.Ed.2d 229.
3
Winston alleged that in April 1959, while he was confined in the United States Penitentiary at Terre Haute, Indiana, he began suffering dizziness, loss of balance, and difficulty with his vision. Upon Winston's initial complaint, the prison medical officer's diagnosis was borderline hypertension; the treatment, a reduction in weight. Winston's symptoms nevertheless recurred with increasing severity over the next nine months; he was unable to keep his balance and fell frequently. He also began to suffer periodic loss of vision. Despite repeated complaints to the prison officers, Winston was given no further treatment, except some dramamine for his dizziness. In January 1960, Winston's attorney became alarmed by his condition and had him examined by a consulting physician. In February 1960, an operation successfully removed the benign brain tumor which had caused Winston's difficulties, but his sight could not be saved. Winston alleged that the negligence of the prison employees was responsible for the delay in diagnosis and removal of the tumor and caused his blindness.
4
Respondent Muniz alleged that he was, in August 1959, a prisoner in a federal correctional institution in Danbury, Connecticut. On the afternoon of August 24, Muniz was outside one of the institution's dormitories when he was struck by an inmate, and then pursued by 12 inmates into another dormitory. A prison guard, apparently choosing to confine the altercation instead of interceding, locked the dormitory. The 12 inmates who had chased Muniz into the dormitory set upon him, beating him with chairs and sticks until he was unconscious. Muniz sustained a fractured skull and ultimately lost the vision of his right eye. He alleged that the prison officials were negligent in failing to provide enough guards to prevent the assaults leading to his injuries and in letting prisoners, some of whom were mentally abnormal, intermingle without adequate supervision.
5
Whether respondents are entitled to maintain these suits requires us to determine what Congress intended when it passed the Federal Tort Claims Act in 1946. This question would not appear at first glance to pose serious difficulty. Congress used neither intricate nor restrictive language in waiving the Government's sovereign immunity. It gave the District Courts jurisdiction
6
'of civil actions on claims against the United States, for money damages, * * * for * * * personal injury * * * caused by the negligent or wrongful act or omission of any employee of the Government while acting within the scope of his office or employment, under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.' 28 U.S.C. § 1346(b).
7
The Act also provides that the 'United States shall be liable, respecting the provisions of this title relating to tort claims, in the same manner and to the same extent as a private individual under like circumstances.' 28 U.S.C. § 2674. Congress qualified this general waiver of immunity in 28 U.S.C. § 2680 by excepting from the Act claims arising from certain government activity, such as transmission of postal matter, assessment of taxes, imposition of a quarantine, or operation of the Panama Canal. None of the exceptions precludes suit against the Government by federal prisoners for injuries sustained in prison. So far as it appears from the face of the Act, Congress has clearly consented to suits such as those involved in the case at bar. Whether a claim could be made out would depend upon whether a private individual under like circumstances would be liable under state law, but prisoners are at least not prohibited from suing. Since a number of lower courts have nevertheless reached a contrary conclusion,4 largely in reliance upon our decision in Feres v. United States, 340 U.S. 135, 71 S.Ct. 153, 95 L.Ed. 152, we deem it appropriate to make a more detailed investigation into the intent of Congress.
8
An examination of the legislative history of the Act reinforces our conclusion that Congress intended to permit such suits. For a number of reasons, it appears that Congress was well aware of claims by federal prisoners and that its failure to exclude them from the provisions of the Act in 28 U.S.C. § 2680 was deliberate. First, the Federal Tort Claims Act, as part of the Legislative Reorganization Act of 1946,5 was designed not only to avoid injustice to those having meritorious claims hitherto barred by sovereign immunity, but to eliminate the burden on Congress of investigating and passing upon private bills seeking individual relief. See Dalehite v. United States, 346 U.S. 15, 24—25, 73 S.Ct. 956, 962, 97 L.Ed. 1427; Feres v. United States, 340 U.S. 135, 139—140, 71 S.Ct. 153, 156, 95 L.Ed. 152.6 The task of screening these bills was substantial. See, e.g., 74 Cong.Rec. 6868. Private claim bills introduced in the Sixty-eighth through the Seventy-eighth Congresses averaged 2,000 or more per Congress, roughtly 20% of which were enacted. H.R.Rep. No. 1287, 79th Cong., 1st Sess. Among the private claim bills were a number submitted on behalf of federal prisoners, of which, between 1935 and 1946, Congress passed 21.7 The much larger number of private bills that must have been introduced were therefore among those adding to Congress' burdens. In these circumstances it cannot be assumed that Congress was unaware of their presence.
9
A second indication that Congress was conscious of claims by federal prisoners is found in the prior versions of the Act. Efforts to permit tort suits against the Government began in 1925 with the introduction of H.R. 12178, 68th Cong., 2d Sess.8 Thereafter, at least one bill was introduced in every Congress, with the exception of the Seventy-fifth, until the present Act was passed by the Seventy-ninth Congress in 1946. Though the provisions of these bills underwent change during the intervening 21 years, the similarities are noteworthy. With the amendment of S. 1912 in the Sixty-ninth Congress, First Session, for example, came the first specific exceptions to the general waiver of sovereign immunity. Two of those exceptions, relating to postal matters and taxation, were cast in language virtually identical to that used in the Act ultimately passed 20 years later. And as exceptions were added over the years, most relieved the Government from liability in the same circumstances as the present Act. Only a few exceptions were at one time proposed and later dropped, without counterpart in the present Act.9 One such exception related to claims by federal prisoners. Six of the 31 bills introduced in Congress between 1925 and 1946 either barred prisoners from suing while in federal prison or precluded suit upon any claim for injury to or death of a prisoner.10 That such an exception was absent from the Act itself is significant in view of the consistent course of development of the bills proposed over the years and the marked reliance by each succeeding Congress upon the language of the earlier bills. We therefore feel that the want of an exception for prisoners' claims reflects a deliberate choice, rather than an inadvertent omission.
10
Finally, the Report of the House Committee on the Judiciary made explicit reference to the laws of four States, which had relaxed, to differing degrees, the rule of sovereign immunity.11 H.R.Rep. No. 1287, 79th Cong., 1st Sess. The report noted that such 'legislation does not appear to have had any detrimental or undesirable effect.' Id., at 3.12 In one of those four States, New York, it was well settled by 1946 that persons could recover for injuries sustained in prison.13 Congressional equanimity in the face of such liability further strengthens the conclusion that Congress intended to permit suits by federal prisoners.
11
Considering the plain import of the statutory language, the number of prisoners' claims among the individual applications for private bills leading to the passage of the Federal Tort Claims Act, the frequent mention of a prisonerclaims exception in proposed bills, and the reference, among others, to New York law, which permitted recovery by prisoners, we believe it is clear that Congress intended to waive sovereign immunity in cases arising from prisoners' claims.14
12
The Government argues nevertheless that we should imply an exception to the Federal Tort Claims Act. For one thing, the Government urges that our decision in Feres v. United States, 340 U.S. 135, 71 S.Ct. 153, 95 L.Ed. 152, controls. For another, it maintains that the impact of liability upon prison discipline would so seriously impair the administration of our prisons that Congress could not have intended such an 'extreme' result.
13
The Court held, in Feres v. United States, that a soldier could not sue under the Federal Tort Claims Act for injuries which 'arise out of or are in the course of activity incident to service.' 340 U.S., at 146, 71 S.Ct., at 159. Among the principal reasons articulated for doing so were: (1) the absence of an analogous or parallel liability, on the part of either an individual or a State; no individual has power to mobilize a militia, no State had been held liable to its militiamen; (2) the presence of a comprehensive compensation system for service personnel; (3) the dearth of private bills from the military; (4) the distinctly federal relationship of the soldier to his superiors and the Government, which should not be disturbed by state laws; and (5) the variations in state law to which soldiers would be subjected, involuntarily, since they have no choice in where they go. Although we find no occasion to question Feres, so far as military claims are concerned, the reasons for that decision are not compelling here.
14
First, the Government's liability is no longer restricted to circumstances in which government bodies have traditionally been responsible for misconduct of their employees. The Act extends to novel and unprecedented forms of liability as well. Indian Towing Co. v. United States, 350 U.S. 61, 76 S.Ct. 122, 100 L.Ed. 48; Rayonier, Inc., v. United States, 352 U.S. 315, 77 S.Ct. 374, 1 L.Ed.2d 354. And in any event, an analogous form of liability exists. A number of States have allowed prisoners to recover from their jailers for negligently caused injuries15 and several States have allowed such recovery against themselves.16
15
Second, the presence of a compensation system, persuasive in Feres, does not of necessity preclude a suit for negligence. In United States v. Brown, 348 U.S. 110, 75 S.Ct. 141, 99 L.Ed. 139, a veteran sought damages for negligent treatment in a Veterans Administration Hospital aggravating a service-incurred injury. The veteran received additional compensation for the aggravation of the injury, even though he was no longer on active duty. The Court nonetheless held that he could bring suit under the Federal Tort Claims Act. Also, the compensation system in effect for prisoners in 1946 was not comprehensive. It provided compensation only for injuries incurred while engaged in prison industries. Neither Winston nor Muniz would have been covered.17
16
Third, private bills were never a problem in the military, Feres v. United States, 340 U.S. 135, 140, 71 S.Ct. 153, 156, 95 L.Ed. 152, as Congress might have thought them to be in the case of prisoners.18
17
Admittedly, the remaining reasons for the decision in Feres, flowing from the impact of state law upon a federal establishment, could have relevance to the prisons as well as the armed forces. The variations in state law may to some extent hamper uniform administration of federal prisons, as it was feared they would hamper the military. And the prisoners' opportunities to recover may be affected by differences in state law over which they have no control, a position shared by service personnel whose location is determined by government order rather than personal volition. So far as uniformity of operation is concerned, however, we have been given few concrete examples of how variations in personal injury law would impair the prison system.19 We are told not that the Government will be judged under too high a standard but under too many. This seems more a matter of conjecture than of reality. The published decisions in which prisoners have sought damages have related more to the precautions necessary to protect a kitchen worker from getting steel wool in his fingers,20 to protect a prisoner from an exploding emery wheel,21 or to protect a prisoner from falling off a ladder,22 than to some delicate matter of prison administration. Even a matter such as improper medical treatment can be judged under the varying state laws of malpractice without violent dislocation of prison routine. Cf. Panella v. United States, 216 F.2d 622 (C.A.2d Cir.). Without more definite indication of the risks of harm from diversity, we conclude that the prison system will not be disrupted by the application of Connecticut law in one case and Indiana law in another to decide whether the Government should be liable to a prisoner for the negligence of its employees. Finally, though the Government expresses some concern that the nonuniform right to recover will prejudice prisoners, it nonetheless seems clear that no recovery would prejudice them even more.
18
In the last analysis, Feres seems best explained by the
19
'peculiar and special relationship of the soldier to his superiors, the effects of the maintenance of such suits on discipline, and the extreme results that might obtain if suits under the Tort Claims Act were allowed for negligent orders given or negligent acts committed in the course of military duty * * *.' United States v. Brown, 348 U.S. 110, 112, 75 S.Ct. 141, 143.
20
We also are reluctant to believe that the possible abuses stemming from prisoners' suits are so serious that all chance of recovery should be denied. It is possible, as the Government suggests, that frivolous suits will be brought, designed only to harass or, more sinister, discover details of prison security useful in planning an escape. And it is possible that the Government will be subjected to the burden of pretrial preparation, discovery, and trial, even though it prevails on the merits. This seems an inescapable concomitant of any form of liability. It is also possible that litigation will damage prison discipline, as the Government most vigorously argues. However, we have been shown no evidence that these possibilities have become actualities in the many States allowing suits against jailers, or the smaller number allowing recovery directly against the States themselves. See notes 15 and 16, supra.
21
In addition, Congress has taken steps to protect the Government from liability that would seriously handicap efficient government operations. We do not intimate any opinion upon their applicability to these complaints, since no such issue is presented for our review. We simply note that the Government is not without defenses. Most important, the Government is relieved from liability on
22
'Any claim based upon an act or omission of an employee of the Government, exercising due care, in the execution of a statute or regulation, whether or not such statute or regulation be valid, or based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the Government, whether or not the discretion involved be abused.' 28 U.S.C. § 2680(a). (Emphasis added.)23
23
Also, the Government is not liable for the intentional torts of its employees, 28 U.S.C.A. § 2680(h), for which prisoners might be especially tempted to initiate retributive litigation.24 We are confident that district judges, sitting without a jury as required by 28 U.S.C. § 2402, will be able to dispose of complaints intelligently without undue harm coming to our federal prisons.25 Federal rules of procedure are not so inflexible that clearly frivolous suits need embarrass prison officials or burden United States Attorneys' offices.
24
One last point remains. Jailers in some States are not liable to their prisoners. For example, several States have decided that a warden in charge of a penitentiary, Carder v. Steiner, 225 Md. 271, 170 A.2d 220, or a sheriff in charge of a county jail, Bush v. Babb, 23 Ill.App.2d 285, 162 N.E.2d 594, is immune from suit because he exercises a quasi-judicial function requiring the use of discretion. Another has decided that the master of a house of correction has no duty of care toward his prisoners which would make him liable for his negligence. O'Hare v. Jones, 161 Mass. 391, 37 N.E. 371. And there are overtones in these decisions suggesting that liability is also denied because of the fear that prison discipline would otherwise be undermined. Such cases should be persuasive. Just as we refused to import the 'casuistries of municipal liability for torts' in Indian Towing, so we think it improper to limit suits by federal prisoners because of restrictive state rules of immunity. Whether a discretionary function is involved is a matter to be decided under 28 U.S.C. § 2680(a), rather than under state rules relating to political, judicial, quasi-judicial, and ministerial functions. And the duty of care owed by the Bureau of Prisons to federal prisoners is fixed by 18 U.S.C. § 4042, independent of an inconsistent state rule.26 Finally, having decided that discipline in the federal prisons will not be so seriously impaired that all recovery should be denied for negligently inflicted injuries, we should not at the same time make recovery depend upon a State's decision to the contrary.27
25
The Federal Tort Claims Act provides much-needed relief to those suffering injury from the negligence of government employees. We should not, at the same time that state courts are striving to mitigate the hardships caused by sovereign immunity,28 narrow the remedies provided by Congress.29 As we said in Rayonier, Inc., v. United States, supra, 352 U.S. at 320, 77 S.Ct. at 377, 'There is no justification for this Court to read exemptions into the Act beyond those provided by Congress. If the Act is to be altered that is a function for the same body that adopted it.'
26
Affirmed.
27
Mr. Justice WHITE took no part in the consideration or decision of this case.
1
28 U.S.C. §§ 1346(b), 2671—2680.
2
The orders of the District Court were initially reversed by a panel of three judges, one judge dissenting. 305 F.2d 253, 285. On rehearing en banc, the panel decisions were upheld. 305 F.2d 264, 287.
3
James v. United States, 280 F.2d 428 (C.A.8th Cir.), cert. denied, 364 U.S. 845, 81 S.Ct. 88, 5 L.Ed.2d 69; Lack v. United States, 262 F.2d 167 (C.A.8th Cir.); Jones v. United States, 249 F.2d 864 (C.A.7th Cir.).
4
James v. United States, 280 F.2d 428 (C.A.8th Cir.), cert. denied, 364 U.S. 845, 81 S.Ct. 88, 5 L.Ed.2d 69; Lack v. United States, 262 F.2d 167 (C.A.8th Cir.); Jones v. United States, 249 F.2d 864 (C.A.7th Cir.); Berman v. United States, D.C., 170 F.Supp. 107; Golub v. United States, Civil No. 148—117, D.C.S.D.N.Y., Oct. 5, 1959; Collins v. United States, No. T—1509, D.C.D.Kansas, Jan. 29, 1958; Trostle v. United States, No. 1493, D.C.W.D.Mo., Feb. 20, 1958; Van Zuch v. United States, D.C., 118 F.Supp. 468; Shew v. United States, D.C., 116 F.Supp. 1; Sigmon v. United States, D.C., 110 F.Supp. 906; Ellison v. United States, No. 1003, D.C.W.D.N.C., July 26, 1951.
5
August 2, 1946, c. 753, 60 Stat. 812.
6
To ensure transfer of private claims to the courts, Congress prohibited introduction of private bills for claims cognizable under the Federal Tort Claims Act. Legislative Reorganization Act of 1946, § 131, 60 Stat. 831, 2 U.S.C. § 190g.
7
Act of August 13, 1935, 49 Stat. 2132; Act of August 26, 1935, 49 Stat. 2182; Act of March 7, 1936, 49 Stat. 2233; Act of March 7, 1936, 49 Stat. 2234; Act of June 11, 1937, 50 Stat. 986; Act of June 15, 1937, 50 Stat 993; Act of June 29, 1937, 50 Stat. 1011; Act of July 19, 1937, 50 Stat. 1036; Act of April 13, 1938, 52 Stat. 1293; Act of July 15, 1939, 53 Stat. 1473; Act of August 5, 1939, 53 Stat. 1501; Act of August 21, 1941, 55 Stat. 955; Act of November 21, 1941, 55 Stat. 971; Act of February 10, 1942, 56 Stat. 1101; Act of February 18, 1942, 56 Stat. 1112; Act of June 6, 1942, 56 Stat. 1180; Act of December 17, 1942, 56 Stat. 1244; Act of February 22, 1944, 58 Stat. 948; Act of May 29, 1944, 58 Stat. 982; Act of December 20, 1944, 58 Stat. 1070; Act of July 25, 1946, 60 Stat. 1264.
8
The Government already had consented to suits upon admiralty and maritime torts involving government vessels in the Suits in Admiralty Act, 41 Stat. 525, 46 U.S.C. §§ 741—752, and the Public Vessels Act, 43 Stat. 1112, 46 U.S.C. §§ 781—790.
9
In a few bills, an exception was made for claims arising out of negligent treatment in government hospitals. No such exception was made in the Act and sovereign immunity was clearly waived as to such claims. See, e.g., United States v. Brown, 348 U.S. 110, 75 S.Ct. 141, 99 L.Ed. 139.
Three exceptions would have barred recovery under the Act where comprehensive compensation schemes were in effect: (1) claims covered by the Federal Employees' Compensation Act; (2) claims for personal injuries incurred by military personnel on active duty; and (3) claims for destruction of personal property belonging to military personnel on active duty covered by predecessors of the Military Personnel Claims Act of 1945. The three applicable compensation statutes have been held to be exclusive: (1) Johansen v. United States, 343 U.S. 427, 72 S.Ct. 849, 96 L.Ed. 1051; Sasse v. United States, 201 F.2d 871 (C.A.7th Cir.); but cf. Parr v. United States, 172 F.2d 462 (C.A.10th Cir.); (2) Feres v. United States, 340 U.S. 135, 71 S.Ct. 153, 95 L.Ed. 152 (at least to the extent of service-connected injuries of active duty personnel); and (3) Preferred Ins. Co. v. United States, 222 F.2d 942 (C.A.9th Cir.), cert. denied, 350 U.S. 837, 76 S.Ct. 74, 100 L.Ed. 747.
Exceptions relating to the administration of laws by the SEC and FTC or to the effect of an Act of Congress or an Executive Order no longer appear, but are subsumed under 28 U.S.C. § 2680(a), which excludes claims based 'upon an act or omission of an employee of the Government, exercising due care, in the execution of a statute or regulation, whether or not such statute or regulation be valid * * *.'
Other than the exception for prisoners' claims, discussed in the text, the only remaining exceptions having no counterpart in the present Act barred liability for governmental activity relating to flood control, harbor and river work, and irrigation projects. To the extent that these activities constitute 'discretionary function(s),' the exception of 28 U.S.C. § 2680(a) still preserves government immunity. United States v. Ure, 225 F.2d 709 (C.A.9th Cir.); Coates v. United States, 181 F.2d 816, 19 A.L.R.2d 840 (C.A.8th Cir.); McGillic v. United States, D.C., 153 F.Supp. 565.
10
H.R. 17168, 71st Cong., 3d Sess.; S. 211, 72d Cong., 1st Sess.; S. 4567, 72d Cong., 1st Sess.; H.R. 5065, 72d Cong., 1st Sess.; S. 1833, 73d Cong., 1st Sess.; S. 1043, 74th Cong., 1st Sess.
11
The House Report accompanied H.R. 181, 79th Cong., 1st Sess., which related only to tort claims. The Federal Tort Claims Act passed at the Second Session of the Seventy-ninth Congress as Title IV of the Legislative Reorganization Act of 1946 was virtually identical to H.R. 181, except that there was no limitation of liability.
12
N.Y.Laws 1929, c. 467, provided, in part:
'The state hereby waives its immunity from liability for the torts of its officers and employees and consents to have its liability for such torts determined in accordance with the same rules of law as apply to an action in the supreme court against an individual or a corporation, and the state hereby assumes liability for such acts, and jurisdiction is hereby conferred upon the court of claims to hear and determine all claims against the state to recover damages for injuries to property or for personal injury caused by the misfeasance or negligence of the officers or employees of the state while acting as such officer or employee. * * *'
The laws of the other three States to which Congress referred, California, Arizona, and Illinois, conferred jurisdiction upon the state courts to hear suits against the state governments for negligence. CalStat.1893, c. 45; Ariz.Laws 1912, c. 59; Ill.Laws 1917, p. 325. However, the state courts did not construe the grant of jurisdiction as a waiver of sovereign immunity and continued to find the Government immune, at least when it was acting in a governmental rather than a proprietary capacity. E.g., Denning v. State, 123 Cal. 316, 55 P. 1000; State v. Sharp, 21 Ariz. 424, 189 P. 631; Monahan v. State, 10 C.C.R. 10 (Ill. Ct. of Claims).
The House Report does not make this distinction apparent, nor for that matter does the report refer with any particularity to the laws of any State.
13
E.g., Paige v. State, 269 N.Y. 352, 199 N.E. 617 (1936); White v. State, 260 App.Div. 413, 23 N.Y.S.2d 526, aff'd, 285 N.Y. 728, 34 N.E.2d 896 (1941). The remedy was limited to some extent, however, since a 'civil death' statute, N.Y. Penal Law § 510, precluded suit while the person was still in prison.
At the time Congress passed the Federal Tort Claims Act, Illinois had just amended its laws and waived its sovereign immunity in tort suits. Ill.Laws 1945, p. 660 (now Ill.Rev.Stat.1961, c. 37, § 439.8). Under this amendment, Illinois prisoners were permitted to recover against the State for negligently caused injuries incurred in prison. E.g., Moore v. State, 21 C.C.R. 282 (Ill. Ct. of Claims). This change in Illinois law occurred after H.R.Rep. No. 1287, 79th Cong., 1st Sess., was prepared and was not brought to Congress' attention.
14
It is true, as the Government points out, that Congress has, since 1946, passed private bills for the relief of federal prisoners. E.g., Act of June 21, 1955, 69 Stat. A30; Act of June 29, 1956, 70 Stat. A97. Since § 131 of the Legislative Reorganization Act of 1946, 2 U.S.C. § 190g, does not permit such bills if recovery is available under the Federal Tort Claims Act, Congress' passage of private bills must, the Government argues, be taken as congressional approval of the decisions barring suit by federal prisoners. However, the construction given an Act of the Seventy-ninth Congress by the Eighty-fourth Congress is not determinative, Rainwater v. United States, 356 U.S. 590, 593, 78 S.Ct. 946, 949, 2 L.Ed.2d 996, and the acquiescence of subsequent Congresses does not of necessity constitute approval. 'We do not expect Congress to make an affirmative move every time a lower court indulges in an erroneous interpretation.' Jones v. Liberty Glass Co., 332 U.S. 524, 534, 68 S.Ct. 229, 234, 92 L.Ed. 142.
15
See cases collected at 14 A.L.R.2d 353; see also Woody, Recovery by Federal Prisoners under the Federal Tort Claims Act, 36 Wash.L.Rev. 338, 353, n. 83.
16
New York, see note 12, supra; Illinois, see note 13, supra; North Carolina, N.C.Gen.Stat., 1958, § 143—291; Ivey v. North Carolina Prison Dept., 252 N.C. 615, 114 S.E.2d 812; Washington, Wash.Laws 1961, c. 136, RCWA 4.92.090.
17
The predecessor of 18 U.S.C. § 4126 provided compensation in 1946 only for prissoners working for Federal Prison Industries, Inc. Only 20% of all federal prisoners were so engaged. 1957 Rep. Atty. Gen. 409. And even those prisoners would not have been covered for injuries sustained outside working hours. In 1961, Congress extended compensation 'to inmates or their dependents for injuries suffered in any industry or in any work activity in connection with the maintenance or operation of the institution where confined.' 18 U.S.C. § 4126, as amended, Sept. 26, 1961, 75 Stat. 681. Even this broadened coverage fails to reach roughly 10% of the prisoners who are physically unable to work. 1957 Rep. Atty. Gen. 409. And, in any event, the compensation system still fails to provide for nonwork injuries, contrary to that applicable to military personnel. Finally, the alteration of a compensation scheme 15 years after Congress passed the Federal Tort Claims Act does not provide reliable insight into the then existing congressional intent.
18
See note 7, supra.
19
One suggestion was that Kansas might find a 10 to 1 guard to prisoner ratio necessary, while Alabama would be satisfied with 30 to 1; thus the wardens of penitentiaries at Leavenworth and Atlanta would have to shape their conduct to different state standards. It would seem more probable, however, that no State has so carefully delineated the boundary between negligence and reasonable care and that, in any event, wardens would assign the number of guards they could afford or thought necessary, rather than the number that might satisfy state concepts of due care.
20
See Van Zuch v. United States, D.C., 118 F.Supp. 468.
21
See Sigmon v. United States, D.C., 110 F.Supp. 906.
22
See Lack v. United States, 262 F.2d 167, (C.A.8th Cir.).
23
See, e.g., Morton v. United States, 97 U.S.App.D.C. 84, 228 F.2d 431.
24
Ibid.
25
Though there are a number of instances in which federal courts have declined to review matters of internal prison discipline and administration, frequently upon application for habeas corpus, they have reviewed serious charges of deprivation of constitutional rights, e.g., Pierce v. La Vallee, 293 F.2d 233 (C.A.2d Cir.); Sewell v. Pegelow, 291 F.2d 196 (C.A.4th Cir.). See also Panella v. United States, 216 F.2d 622 (C.A.2d Cir.) (U.S. Public Health Service Hospital, Lexington, Ky.); Coffin v. Reichard, 143 F.2d 443, 155 A.L.R. 143 (C.A.6th Cir.) (U.S. Public Health Service Hospital, Lexington, Ky.).
26
18 U.S.C. § 4042 provides:
'The Bureau of Prisons, under the direction of the Attorney General, shall—
'(1) have charge of the management and regulation of all Federal penal and correctional institutions;
'(2) provide suitable quarters and provide for the safekeeping, care, and subsistence of all persons charged with or convicted of offenses against the United States, or held as witnesses or otherwise;
'(3) provide for the protection, instruction, and discipline of all persons charged with or convicted of offenses against the United States.'
27
Respondent Muniz suggests that a federal law should be developed, since some federal prisons are within federal enclaves. The suggestion is impractical, since some prisons are not within enclaves, and is forestalled by 45 Stat. 54, 16 U.S.C. § 457, which provides:
'In the case of the death of any person by the neglect or wrongful act of another within a national park or other place subject to the exclusive jurisdiction of the United States, within the exterior boundaries of any State, such right of action shall exist as though the place were under the jurisdiction of the State within whose exterior boundaries such place may be; and in any action brought to recover on account of injuries sustained in any such place the rights of the parties shall be governed by the laws of the State within the exterior boundaries of which it may be.' See, e.g., Stokes v. Adair, 265 F.2d 662 (C.A.4th Cir.), cert. denied, 361 U.S. 816, 80 S.Ct. 56, 4 L.Ed.2d 62.
28
See, e.g., Holytz v. Milwaukee, 17 Wis.2d 26, 115 N.W.2d 618; Muskopf v. Corning Hospital Dist., 55 Cal.2d 211, 11 Cal.Rptr. 89, 359 P.2d 457; Williams v. Detroit, 364 Mich. 231, 111 N.W.2d 1; Molitor v. Kaneland Community Unit Dist. No. 302, 18 Ill.2d 11, 163 N.E.2d 89, 86 A.L.R.2d 469; Hargrove v. Cocoa Beach 96 So.2d 130 (Fla.).
29
See Pound, The Tort Claims Act: Reason or History? 30 NACCA L.J. —- (1963).
| 78
|
374 U.S. 500
83 S.Ct. 1877
10 L.Ed.2d 1045
Betty Jean DANIELSv.VIRGINIA.
No. 485, Misc.
Supreme Court of the United States
June 17, 1963
Theodore J. St. Antoine, for petitioners.
On Petition for Writ of Certiorari to the Supreme Court of Appeals of Virginia.
PER CURIAM.
1
The motion for leave to proceed in forma pauperis and the petition for writ of certiorari are granted. The judgment is vacated and the case is remanded for further consideration in light of Peterson v. City of Greenville, 373 U.S. 244, 83 S.Ct. 1119, 1133.
2
Mr. Justice HARLAN concurs in the result on the premises stated in his separate opinion in Peterson v. City of Greenville, supra, and Avent v. North Carolina, 373 U.S. 248, 83 S.Ct. 1133.
| 12
|
375 U.S. 22
84 S.Ct. 83
11 L.Ed.2d 43
Eugene F. SHOCKEYv.ILLINOIS.
No. 20, Misc.
Supreme Court of the United States
October 14, 1963
John R. Snively, for petitioner.
William G. Clark, Atty. Gen. of Illinois, for respondent.
On Petition for Writ of Certiorari to the Supreme Court of Illinois.
PER CURIAM.
1
The motion for leave to proceed in forma pauperis and the petition for a writ of certiorari are granted. The judgment is vacated and the case is remanded to the Supreme Court of Illinois for further consideration in light of Douglas v. California, 372 U.S. 353, 83 S.Ct. 814, 9 L.Ed.2d 811.
2
Mr. Justice HARLAN, for the reasons stated in Daegele v. Kansas, 375 U.S. 1, 84 S.Ct. 89, would have withheld disposition of this petition for certiorari until the disposition, after argument, of that case.
| 12
|
375 U.S. 28
84 S.Ct. 137
11 L.Ed.2d 45
Albert E. BARNESv.NORTH CAROLINA.
No. 385, Misc.
Supreme Court of the United States
October 14, 1963
Samuel S. Mitchell, for petitioner.
Thomas Wade Bruton, Atty. Gen. of North Carolina, and James F. Bullock, Asst. Atty. Gen., for respondent.
On Petition for Writ of Certiorari to the Supreme Court of North Carolina.
PER CURIAM.
1
The motion for leave to proceed in forma pauperis and the petition for a writ of certiorari are granted. The judgment is vacated and the case is remanded to the Supreme Court of North Carolina for further consideration in light of Gideon v. Wainwright, 372 U.S. 335, 83 S.Ct. 792, 9 L.Ed.2d 799.
2
Mr. Justice HARLAN, for the reasons stated in his dissenting opinion in Pickelsimer v. Wainwright, 375 U.S. 2, at p. 3, 84 S.Ct. 80, at p. 81, would have withheld disposition of this petition for certiorari until the disposition, after argument, of that case.
| 01
|
375 U.S. 2
84 S.Ct. 80
11 L.Ed.2d 41
Clyde PICKELSIMER, Jr.v.Louie L. WAINWRIGHT. Martin A. MIHELCICH, petitioner, v. Louie L. WAINWRIGHT, Director, Division of Corrections. Donald COWAN, petitioner, v. Louie L. WAINWRIGHT, Director, Division of Corrections of Florida. Joseph R. DUMOND, petitioner, v. Louie L. WAINWRIGHT, Director, Division of Corrections. R bert Clayton SHARP, petitioner, v. Louie L. WAINWRIGHT, Director, Division of Corrections. William E. BAKER, petitioner, v. Louie L. WAINWRIGHT, Director, Division of Corrections. Sidney James HEARD, petitioner, v. L.L. WAINWRIGHT, Director, Division of Corrections. Arthel CAMPBELL, petitioner, v. Louie L. WAINWRIGHT, Director, Division of Corrections. [2-Continued] Lafayette E. MITCHELL, petitioner, v. L.L. WAINWRIGHT, Director, Division of Corrections. Roy KITCHENS, petitioner, v.
Nos. 16, 36, 54, 55, 60, 62, 70, 71, 86, 87, Misc.
Supreme Court of the United States
October 14, 1963
Petitioners pro se.
Richard W. Ervin, Atty. Gen. of Fla., and A. G. Spicola, Jr., Asst. Atty. Gen., for respondents Pickelsimer, Sharp and Heard.
Richard W. Ervin, Atty. Gen. of Fla., and George R. Georgieff, Asst. Atty. Gen., for respondents Mihelcich, Cowan and Kitchens.
Richard W. Ervin, Atty. Gen. of Fla., and James G. Mahorner, Asst. Atty. Gen., for respondents Dumond, Baker, Campbell and Mitchell.
PER CURIAM.
1
The motions for leave to proceed in forma pauperis and the petitions for writs of certiorari are granted. The judgments are vacated and the cases are remanded to the Supreme Court of Florida for further consideration in light of Gideon v. Wainwright, 372 U.S. 335, 83 S.Ct. 792, 9 L.Ed.2d 799.
2
Mr. Justice HARLAN, dissenting.
3
I am unable to agree with the Court's summary disposition of these 10 Florida cases, and believe that the federal question which they present in common is deserving of full-dress consideration. That question is whether the denial of an indigent defendant's right to court-appointed counsel in a state criminal trial as established last Term in Gideon v. Wainwright, 372 U.S. 335, 83 S.Ct. 792, 9 L.Ed.2d 799, overruling Betts v. Brady, 316 U.S. 455, 62 S.Ct. 1252, 86 L.Ed. 1595, invalidates his pre-Gigeon conviction.
4
When this Court is constrained to change well-established constitutional rules governing state criminal proceedings, as has been done here and in other recent cases, see, e.g., Mapp v. Ohio, 367 U.S. 643, 81 S.Ct. 1684, 6 L.Ed.2d 1081; Ker v. California, 374 U.S. 23, 83 S.Ct. 1623, 10 L.Ed.2d 726; Douglas v. California, 372 U.S. 353, 83 S.Ct. 814, 9 L.Ed.2d 811, it seems to me that the question whether the States are constitutionally required to apply the new rule retrospectively, which may well require the reopening of cases long since finally adjudicated in accordance with then applicable decisions of this Court, is one that should be decided only after informed and deliberate consideration. Surely no general answer is to be found in 'the fiction that the law now announced has always been the law.' Griffin v. Illinois, 351 U.S. 12, 26, 76 S.Ct. 585, 594, 100 L.Ed. 891 (Frankfurter, J., concurring). Nor do I believe that the circumstance that Gideon was decided in the context of a state collateral proceeding rather than upon direct review, as were the new constitutional doctrines enunciated in Mapp and Ker, forecloses consideration of the retroactivity issue in this instance.1
5
In the current swift pace of constitutional change, the time has come for the Court to deal definitively with this important and far-reaching subject.2 Without intimating any view as to how the question should be decided in these cases, I would set one or more of them for argument.3
1
The Court's opinion in Gideon contains no discussion of this issue. Similarly, in cases decided last Term in which we summarily vacated the judgment and remanded for further consideration in light of Gideon, e.g., Bryant v. Wainwright, 374 U.S. 492, 83 S.Ct. 1884, 10 L.Ed.2d 1047, the question of retroactivity was not treated in the disposiitions.
2
Such cases as Eskridge v. Washington State Prison Board, 357 U.S. 214, 78 S.Ct. 1061, 2 L.Ed.2d 1269, and Norvell v. Illinois, 373 U.S. 420, 83 S.Ct. 1366 10 L.Ed.2d 456, hardly constitute precedents for a rule of general application.
3
In all but two of these cases, the State suggests that the judgments can be supported on an adequate independent state ground, even though the Florida Supreme Court denied relief without hearing or explanatory opinion, and despite the apparent concession in Nos. 36 and 87 that the state court did face the federal question and rule adversely to the petitioners. It is abundantly clear that each of the state grounds suggested is either plainly unavailing or so tenuous that it would be disrespectful of the Florida Supreme Court to regard it as the basis of that cout's judgment. Cf. Klinger v. Missouri, 13 Wall. 257, 20 L.Ed. 635; Adams v. Russell, 229 U.S. 353, 358-359, 33 S.Ct. 846, 847-848, 57 L.Ed. 1224; Williams v. Kaiser, 323 U.S. 471, 478-479, 65 S.Ct. 363, 367-368, 89 L.Ed. 398. Accordingly, I am satisfied that the federal question is properly before this Court in all of the cases.
| 01
|
375 U.S. 1
84 S.Ct. 89
11 L.Ed.2d 44
George Wm. DAEGELEv.KANSAS.
No. 72, Misc.
Supreme Court of the United States
October 14, 1963
George Wm. Daegele, pro se.
William M. Ferguson, Atty. Gen. of Kan., and J. Richard Foth, Asst. Atty. Gen., for respondent.
On Petition for Writ of Certiorari to the Supreme Court of Kansas.
PER CURIAM.
1
The motion for leave to proceed in forma pauperis and the petition for a writ of certiorari are granted. The judgment is vacated and the case is remanded to the Supreme Court of Kansas for further consideration in light of Douglas v. California, 372 U.S. 353, 83 S.Ct. 814, 9 L.Ed.2d 811.
2
For reasons expressed in his dissenting opinion in No. 16, Misc., Pickelsimer v. Wainwright, and related cases, 375 U.S. 2, 84 S.Ct. p. 80, Mr. Justice HARLAN would set this case for argument of the question whether Douglas v. California, 372 U.S. 353, 83 S.Ct. 814, 9 L.Ed.2d 811, should be applied retroactively.
| 12
|
375 U.S. 51
84 S.Ct. 152
11 L.Ed.2d 108
Elmer BANKSv.WAINWRIGHT.
No. 76, Misc.
Supreme Court of the United States
October 21, 1963
Elmer Banks, pro se.
Richard W. Ervin, Atty. Gen. of Florida, and A. G. Spicola, Jr., Asst. Atty. Gen., for respondent.
On Petition for Writ of Certiorari to the Supreme Court of Florida.
PER CURIAM.
1
The motion for leave to proceed in forma pauperis and the petition for a writ of certiorari are granted. The judgment is vacated and the case is remanded to the Supreme Court of Florida for further consideration in light of Gideon v. Wainwright, 372 U.S. 335, 83 S.Ct. 792, 9 L.Ed.2d 799.
2
Mr. Justice DOUGLAS and Mr. Justice CLARK dissent for the reason that the judgment rests on an adequate state ground.
| 01
|
375 U.S. 29
84 S.Ct. 19
11 L.Ed.2d 1
Salvatore PANICO, Petitioner,v.UNITED STATES.
No. 45.
Oct. 21, 1963.
Jerome Lewis, for petitioner.
Solicitor General Cox, Assistant Attorney General Miller, Beatrice Rosenberg and Kirby W. Patterson, for the United States.
PER CURIAM.
1
The petition for a writ of certiorari is granted.
2
The petitioner was one of numerous defendants in a lengthy criminal trial in the United States District Court for the Southern District of New York. He was found guilty, but his conviction was reversed on appeal. United States v. Bentvena, 2 Cir., 319 F.2d 916. For his conduct during the trial the petitioner was found guilty of criminal contempt in a summary proceeding conducted by the trial judge under Rule 42(a) of the Federal Rules of Criminal Procedure after the trial had ended.1 This contempt conviction was affirmed on appeal, one judge dissenting. 2 Cir., 308 F.2d 125.
3
If the petitioner was legally responsible for his conduct during the trial, there can be no doubt that his conduct was contumacious. It is contended, however, that at the time of the conduct in question the petitioner was suffering from a mental illness which made him incapable of forming the criminal intent requisite for a finding of guilt. No separate hearing was had upon this issue in the contempt proceeding, although during the course of the previous criminal trial, the judge had heard conflicting expert testimony upon the different question of the petitioner's mental capacity to stand trial. Shortly after the contempt conviction, the petitioner was found by state-appointed psychiatrists to be suffering from schizophrenia and committed to a state mental hospital. Cf. Bush v. Texas, 372 U.S. 586, 83 S.Ct. 922, 9 L.Ed.2d 958.
4
In the light of these circumstances, we hold that the fair administration of federal criminal justice requires a plenary hearing under Rule 42(b) of the Federal Rules of Criminal Procedure to determine the question of the petitioner's criminal responsibility for his conduct.2 Accordingly, the judgment of the Court of Appeals is vacated, and the case is remanded to the District Court.
5
It is so ordered.
6
Judgment of Court of Appeals vacated and case remanded.
7
Mr. Justice CLARK and Mr. Justice HARLAN would affirm the judgment below substantially for the reason given by Judge Smith in his opinion for the Court of Appeals. United States v. Panico, 2 Cir., 308 F.2d 125.
1
'Rule 42. Criminal Contempt.
'(a) Summary Disposition. A criminal contempt may be punished summarily if the judge certifies that he saw or heard the conduct constituting the contempt and that it was committed in the actual presence of the court. The order of contempt shall recite the facts and shall be signed by the judge and entered of record.'
2
'Rule 42. Criminal Contempt.
'* * * (b) Disposition Upon Notice and Hearing. A criminal contempt except as provided in subdivision (a) of this rule shall be prosecuted on notice. The notice shall state the time and place of hearing, allowing a reasonable time for the preparation of the defense, and shall state the essential facts constituting the criminal contempt charged and describe it as such. The notice shall be given orally by the judge in open court in the presence of the defendant or, on application of the United States attorney or of an attorney appointed by the court for that purpose, by an order to show cause or an order of arrest. The defendant is entitled to a trial by jury in any case in which an act of Congress so provides. He is entitle to admission to bail as provided in these rules. If the contempt charged involves disrespect to or criticism of a judge, that judge is disqualified from presiding at the trial or hearing except with the defendant's consent. Upon a verdict or finding of guilt the court shall enter an order fixing the punishment.'
| 01
|
375 U.S. 34
84 S.Ct. 1
11 L.Ed.2d 4
TIPTONv.SOCONY MOBIL OIL COMPANY, Inc.
No. 200.
Oct. 21, 1963.
Rehearing Denied Dec. 2, 1963.
See 375 U.S. 936, 84 S.Ct. 328.
Clyde W. Woody, for petitioner.
George B. Matthews, for respondent.
PER CURIAM.
1
Petitioner brought this action in the District Court for the Southern District of Texas against his employer under the Jones Act. 46 U.S.C. § 688. The principal issue was whether, in view of the nature of the work performed at the time of injury, the petitioner was a seaman, hence within the coverage of the Jones Act, or an offshore drilling employee. At the trial before a jury, the District Court admitted evidence, over the objection of petitioner's counsel, that petitioner had accepted compensation benefits under the Longshoremen's and Harbor Workers' Compensation Act, 33 U.S.C. § 901 et seq., as applied through the Outer Continental Shelf Lands Act, 43 U.S.C. § 1331 et seq. The latter Act, although extending longshoremen's compensation to a new group, is explicitly inapplicable to a 'member of a crew of any vessel.' 43 U.S.C. § 1333(c)(1). In response to a special interrogatory the jury found that the petitioner was not a seaman or member of a crew of a vessel within the meaning of the Jones Act. Judgment was then entered upon the verdict for the respondent. The Court of Appeals for the Fifth Circuit unanimously held it error to have admitted the evidence of other compensation benefits but, with one judge dissenting, found the error harmless.1 We grant the petition for a writ of certiorari and vacate the judgment.
2
We do not agree that on the record in this case the error may be regarded as harmless.2 There can be no doubt that the evidence of other benefits was pressed upon the jury. Throughout the trial respondent's counsel emphasized that the petitioner 'has a remedy under a federal compensation act, and in fact received benefits in the form of weekly payments under that act * * *.' The only argued relevance of this evidence was that it indicated what the petitioner had thought to be his legal status. The judge did not, however, frame a cautionary instruction or otherwise charge the jury that the evidence of other compensation might be considered only insofar as it revealed what the petitioner and others thought his status to be—whether seaman or drilling employee—and was not dispositive of the ultimate fact of whether he was a seaman. To the contrary, the judge's charge, containing an elaborate discussion of the Longshoremen's and Harbor Workers' Compensation Act and a restatement of the disputed evidence, only heightened the likelihood of prejudice.
3
A subsequent exchange between judge and jury did not, in our opinion, negate the cumulative impact of the evidence and the instructions. The jury, while deliberating, sent the following note to the judge:
4
'If we find Mr. Tipton is not a seaman or a member of the crew of drilling barge No. 1, does he have recourse for compensation under the Outer Continental Shelf or other act?'
The judge immediately replied:
5
'This is not a matter for the jury's consideration. You should consider only the questions submitted and the evidence thereon.'
6
The petitioner contends, correctly we think, that this reply was insufficient to overcome the impact of the evidence of other compensation as submitted to the jury.3 Although the judge's reply excluded from the jury's consideration the availability of alternative benefits in a future action, it did not preclude or restrict consideration of the evidence presented concerning prior receipt of compensation payments. The direction to consider 'the questions submitted' was not illuminating and the further reference to 'the evidence thereon' necessarily encompassed the admitted evidence of payments received and retained by petitioner.
7
We disagree with the suggestion of the Court of Appeals that the prejudicial effect of the evidence of other compensation would be restricted to the issue of damages and would not affect the determination of liability.4 That suggestion ignores that the evidence was presumably considered without qualification as bearing on a basic fact essential to liability. Indeed, the jury's inquiry to the judge seems to indicate that, under the case as submitted, the jury was led to place undue emphasis on the availability of compensation benefits in determining the ultimate question of whether the petitioner was a seaman within the Jones Act. On such a record the disputed evidence cannot properly be deemed harmless. 28 U.S.C. § 2111; Fed.Rules Civ.Proc. 61. Cf. Kotteakos v. United States, 328 U.S. 750, 66 S.Ct. 1239, 90 L.Ed. 1557.
8
The judgment of the Court of Appeals for the Fifth Circuit is vacated and the case remanded to the District Court for the Southern District of Texas for proceedings in accordance with this opinion.
9
It is so ordered.
10
Judgment of Court of Appeals vacated and case remanded.
11
Mr. Justice HARLAN, dissenting.
12
I am of the opinion that the petition for certiorari should have been denied in this case, which raises only a question of the admissibility of certain evidence and a ruling of the Court of Appeals that the admission of the evidence, which it thought erroneous, was harmless. See my opinion in Ferguson v. Moore-McCormack Lines, Inc., 352 U.S. 521, 559, 77 S.Ct. 457, 478, 1 L.Ed.2d 511, and the dissenting opinion of Mr. Justice Frankfurter in the same case, id., 352 U.S. at 524, 77 S.Ct. at 458, 1 L.Ed.2d 511.
13
Since the petition has been granted, I am constrained to say that I am doubtful of the ruling below that evidence probative of the petitioner's belief as to his status as a seaman or drilling employee was irrelevant to the issue of what his status actually was. His belief to be sure did not amount to a demonstration of the fact; but it seems to me sufficiently relevant to be not clearly inadmissible on the issue of his status, to show which was the purpose for which the evidence was offered. In any event, I find no solid reason for disturbing the view of the Court of Appeals that the admission of this evidence in the circumstances of this case did not prejudice the petitioner and was, therefore, harmless error.
14
Accordingly, while I believe the case is not 'certworthy,' I would affirm the judgment below.
1
315 F.2d 660, 662 (Brown, J., dissenting).
2
The majority of the Court of Appeals explained its conclusion as follows:
'(I)n view of the fact that the jury, having decided the question of status adversely to appellant, never reached the issue of damages, we believe that the error did not prejudice appellant and was harmless.' 315 F.2d 660, at 662.
3
Not until after the verdict and after the discharge of the jury did counsel learn of the jury's inquiry and the judge's reply. Petitioner's counsel, when informed, immediately took exception to the procedure and the reply. However, for present purposes we need not question the permissibility of the procedures involved.
4
See note 2, supra.
| 78
|
375 U.S. 32
84 S.Ct. 24
11 L.Ed.2d 106
Natale EVOLAv.UNITED STATES. Salvatore SANTORA, Petitioner, v. UNITED STATES. Vito GENOVESE, Petitioner, v. UNITED STATES. Vincent GIGANTE, Petitioner, v. UNITED STATES. Joseph DiPALERMO, Petitioner, v. UNITED STATES. Charles DiPALERMO, Petitioner, v. UNITED STATES. Rocco MAZZIE, Petitioner, v. UNITED STATES. Carmine POLIZZANO and Ralph Polizzano, Petitioners, v. UNITED STATES. [32-Continued] Charles BARCELLONA, Petitioner, v. UNITED STATES.
Nos. 194—197.
Misc. Nos. 79, 80, 115, 149, 224.
Supreme Court of the United States
Maurice Edelbaum, for petitioner Evola.
Herbert S. Siegal, for petitioner Santora.
Edward Bennett Williams and Wilfred L. Davis, for petitioner Genovese.
Wilfred L. Davis, for petitioner Gigante.
Allen S. Stim, for petitioner Polizzano and others.
Robert S. Carlson, for petitioner Barcellona.
Joseph Di Palermo, Charles Di Palermo and Rocco Mazzie, pro se.
Solicitor General Cox, Assistant Attorney General Miller, Beatrice Rosenberg and Richard W. Schmude, for the United States.
PER CURIAM.
375 U.S. 32
84 S.Ct. 24
11 L.Ed.2d 106
Natale EVOLA
1
v.
2
UNITED STATES. Salvatore SANTORA, Petitioner, v. UNITED STATES. Vito GENOVESE, Petitioner, v. UNITED STATES. Vincent GIGANTE, Petitioner, v. UNITED STATES. Joseph DiPALERMO, Petitioner, v. UNITED STATES. Charles DiPALERMO, Petitioner, v. UNITED STATES. Rocco MAZZIE, Petitioner, v. UNITED STATES. Carmine POLIZZANO and Ralph Polizzano, Petitioners, v. UNITED STATES. [32-Continued] Charles BARCELLONA, Petitioner, v. UNITED STATES.
3
Nos. 194—197.
Misc. Nos. 79, 80, 115, 149, 224.
Supreme Court of the United States
4
Maurice Edelbaum, for petitioner Evola.
5
Herbert S. Siegal, for petitioner Santora.
6
Edward Bennett Williams and Wilfred L. Davis, for petitioner Genovese.
7
Wilfred L. Davis, for petitioner Gigante.
8
Allen S. Stim, for petitioner Polizzano and others.
9
Robert S. Carlson, for petitioner Barcellona.
10
Joseph Di Palermo, Charles Di Palermo and Rocco Mazzie, pro se.
11
Solicitor General Cox, Assistant Attorney General Miller, Beatrice Rosenberg and Richard W. Schmude, for the United States.
12
PER CURIAM.
13
The petitions for writs of certiorari in Nos. 194, 195, 196 and 197, and the motions for leave to proceed in forma pauperis, as well as the petitions for certiorari in No. 79, Misc., No. 80, Misc., No. 115, Misc., No. 149, Misc., and No. 224, Misc., are granted.
14
The judgment of the Court of Appeals for the Second Circuit is vacated and the cases are remanded to that court for reconsideration in light of Campbell v. United States, 373 U.S. 487, 83 S.Ct. 1356, 10 L.Ed.2d 501, and for such further consideration as may be appropriate.
15
Mr. Justice CLARK, with whom Mr. Justice HARLAN and Mr. Justice WHITE join, concurring in part and dissenting in part.
16
I realize, of course, that in remanding these cases the Court neither decides that Campbell governs nor implies how the Court of Appeals should decide them. Nevertheless, I would grant the petitions for certiorari and set these cases for argument, since it is my feeling that it is futile to remand 'for reconsideration in light of Campbell v. United States, 373 U.S. 487 (83 S.Ct. 1356, 10 L.Ed.2d 501).'
17
Although these cases were decided prior to Campbell, the Court of Appeals' disposition has support in the record and is worthy of argument.* All the evidence before the District Court was documentary and the Court of Appeals was therefore correct in making factual determinations on the basis of such evidence.
*
I deem plenary consideration here preferable to this remand because the delineation of the limits of the Jencks Act has been peculiarly the province of this Court. The remand will merely delay a final decision which could be made on the record now before the Court and the identical record will no doubt return here no matter what determination is made by the Court of Appeals.
While the Government accepts the District Court's finding that the Shaw notes should have been produced under 18 U.S.C. § 3500, this does not relieve the courts of the obligation to examine independently the error confessed. Gibson v. United States, 329 U.S. 338, 67 S.Ct. 301, 91 L.Ed. 331, and Young v. United States, 315 U.S. 257, 62 S.Ct. 510, 86 L.Ed. 832.
| 01
|
375 U.S. 39
84 S.Ct. 8
11 L.Ed.2d 8
SHENANDOAH VALLEY BROADCASTING, INC., et al.v.AMERICAN SOCIETY OF COMPOSERS, AUTHORS AND PUBLISHERS.
No. 323.
Oct. 21, 1963.
For Opinion on Rehearing
see 84 S.Ct. 627.
Ralstone R. Irvine and Walter R. Mansfield, for petitioners.
Arthur H. Dean, William Piel, Jr., Herman Finkelstein and Lloyd N. Cutler, for respondent.
PER CURIAM.
1
In 1950 the District Court for the Southern District of New York entered an amended consent decree in a government Sherman Act suit requiring ASCAP inter alia to 'grant to any user making written application therefor a non-exclusive license to perform all of the compositions in the ASCAP repertory' subject to a reasonable license fee. On request of petitioners for a license ASCAP refused to fix a fee and, as provided by the amended consent decree, this application was filed for an order to fix a reasonable fee. The District Court found that the consent decree did not require ASCAP to issue the type of license petitioners requested and, therefore, dismissed the application. 208 F.Supp. 896. The petitioners took an appeal to the Court of Appeals and also perfected a direct one to this Court under § 2 of the Expediting Act. 15 U.S.C. § 29. We dismissed the appeal filed here for want of jurisdiction, 371 U.S. 540, 83 S.Ct. 519, 9 L.Ed.2d 508 (1963). Thereafter, the Court of Appeals dismissed the appeal perfected there, 317 F.2d 90, on the ground that all appeals are 'routed' to this Court by the Expediting Act and this petition brings that question here once again.
2
The dismissal that we heretofore entered was based on our unexpressed view that the appeal from an ancillary order of this type was not within the Expediting Act. Direct appeals to this Court are authorized by that Act only from final judgments where the United States is a complainant. The purpose of the Act is to expedite litigation of 'great and general importance' where the Government is the aggrieved party. See 36 Cong.Rec. 1679 (1903). The controversy which is disposed of by the District Court's order is entirely between private parties and is outside the mainstream of the litigation in which the Government is directly concerned. Compare Terminal R. Ass'n. of St. Louis v. United States, 266 U.S. 17, 45 S.Ct. 5, 69 L.Ed. 150; Aluminum Co. of America v. United States, 302 U.S. 230, 58 S.Ct. 178, 82 L.Ed. 219. In these circumstances, and the order being final rather than interlocutory, we believe that the appeal does lie under 28 U.S.C. § 1291. The petition is therefore granted and the judgment is reversed and the cause remanded to the Court of Appeals for consideration on its merits.
3
It is so ordered.
4
Judgment reversed and cause remanded.
5
Mr. Justice BLACK acquiesces in the Court's judgment because of the holding in the prior appeal.
| 89
|
375 U.S. 50
84 S.Ct. 151
11 L.Ed.2d 108
John W. CREWSv.WAINWRIGHT.
No. 59, Misc.
Supreme Court of the United States
October 21, 1963
John W. Crews, pro se.
Richard W. Ervin, Atty. Gen. of Florida, and James G. Mahorner, Asst. Atty. Gen., for respondent.
On Petition for Writ of Certiorari to the Supreme Court of Florida.
Opinion on remand 158 So.2d 519.
PER CURIAM.
1
The motion for leave to proceed in forma pauperis and the petition for a writ of certiorari are granted. The judgment is vacated and the case is remanded to the Supreme Court of Florida for further consideration in light of Gideon v. Wainwright, 372 U.S. 335, 83 S.Ct. 792, 9 L.Ed.2d 799.
2
Mr. Justice DOUGLAS and Mr. Justice CLARK dissent for the reason that the judgment rests on an adequate state ground.
| 01
|
375 U.S. 52
84 S.Ct. 21
11 L.Ed.2d 11
Dominick BARTONE, Petitioner,v.UNITED STATES of America.
No. 337.
Decided Oct. 28, 1963.
O. B. Cline, Jr. and Nicholas J. Capuano, for petitioner.
Solicitor General Cox, for the United States.
PER CURIAM.
1
Although there were other questions before the Court of Appeals, the sole question presented by this petition is stated as follows:
2
'May a United States District Judge orally revoke the probation of a Defendant in open court and in the presence of the Defendant and his counsel and impose a sentence of confinement for a specific period of time and thereafter enter a formal written judgment and commitment in which a larger and longer sentence of confinement is imposed and set forth?'
3
It appears that on September 14, 1962, petitioner and his counsel appeared in the District Court, at which time a sentence of confinement of one year was imposed. Subsequently, and in petitioner's absence, the court enlarged the penalty by one day.
4
The propriety of this enlargement of the sentence, along with other questions, was presented on the appeal to the Court of Appeals, which made no mention of it in its opinion. 317 F.2d 608. The Court of Appeals did, however, deny a motion of the United States to remand the cause for the purpose of correcting the sentence—relief to which the United States concedes petitioner is entitled.1 See Rakes v. United States, 4th Cir., 309 F.2d 686. The only question is whether the error will be corrected here and now or whether petitioner will be remitted to his remedy under Rule 35 of the Federal Rules of Criminal Procedure; and whether petitioner will be advantaged by one procedure or another is not our concern.
5
This error, in enlarging the sentence in the absence of petitioner, was so plain in light of the requirements of Rule 432 that it should have been dealt with by the Court of Appeals, even though it had not been alleged as error.
6
As seen from our Miscellaneous Docket for 1962, the use of collateral proceedings for relief from federal judgments of conviction is considerable:
7
OCTOBER TERM, 1962. -- MISCELLANEOUS DOCKET.
8
Totals.
Federal prisoners:
Direct attack...................... 109
29 U.S.C. § 2255.................... 93
Habeas corpus through federal courts.38
Original habeas corpus (in this Court). 40
Rule 35, Fed. Rules Crim. Proc......__4
284
9
Where state procedural snarls or obstacles preclude an effective state remedy against unconstitutional convictions, federal courts have no other choice but to grant relief in the collateral proceeding. See Fay v. Noia, 372 U.S. 391, 83 S.Ct. 822, 9 L.Ed.2d 837. But the situation is different in federal proceedings, over which both the Courts of Appeals and this Court (McNabb v. United States, 318 U.S. 332, 63 S.Ct. 608, 87 L.Ed. 819) have broad powers of supervision. It is more appropriate, whenever possible, to correct errors reachable by the appeal rather than remit the parties to a new collateral proceeding.
10
We grant certiorari and reverse the judgment denying correction of the sentence.
11
Mr. Justice CLARK, with whom Mr. Justice HARLAN and Mr. Justice STEWART join, dissenting.
12
Petitioner was convicted of attempting to export munitions of war from the United States to a foreign state without a license in violation of § 414 of the Mutual Security Act of 1954, 68 Stat. 848, as amended, 22 U.S.C. § 1934. This statute provides a maximum penalty of two years' imprisonment and $25,000 fine. Imposition of sentence of confinement was withheld and petitioner was placed on probation for three years and fined $10,000 (later reduced to $7,500). Thereafter, the Probation Officer petitioned the District Court to issue a warrant and revoke petitioner's probation, alleging that petitioner had violated probation by participating in a contract to sell arms to the Republic of Honduras. After hearing, the court revoked the probation and orally sentenced petitioner to one year imprisonment. Bail was denied by the District Court but granted by the Court of Appeals pending petitioner's appeal. Before submission on the merits, the Government called the Court of Appeals' attention to the fact that the sentence was recorded as one year and one day rather than one year only and moved that the case be remanded to correct the sentence. The court denied the motion and thereafter affirmed the case on the merits. Petitioner sought rehearing, suggesting that the Court of Appeals 'failed to consider' the sentencing error, which petitioner had not argued 'fully.' The petition was denied and the case came here on this issue alone.
13
The Court summarily reverses and directs that the sentence be corrected. I believe that this is error. The petitioner never presented this question to the District Court and that court has not passed upon it. Under Rule 35 of the Federal Rules of Criminal Procedure, an application to correct an illegal sentence may be made to the District Court at any time. In addition, Rule 36, as to clerical errors (w ich apparently this is), likewise places power in the District Court to make correction. This Court, however, by its action today makes this an appealable error even though it has never been called to the attention of the trial court. The Court has thereby created an additional remedy for obtaining relief from a sentencing error, despite the existence of the adequate relief already provided in Rule 35 or Rule 36 of the Federal Rules of Criminal Procedure. Heretofore, claims of this nature have been prosecuted in the District Court by motion under Rule 35. The Court's new method of relief not only prevents the District Court from correcting its own error but also delays the final disposition of the case and creates confusion in the administration of justice. I would require petitioner, as the Rules provide, to apply to the District Court.
14
Moreover, petitioner may not understand the practical effect of the error on his term of prison sentence. Under 18 U.S.C. § 4161, petitioner is allowed six days per month deduction for good behavior if his sentence is a year and a day. Sentence of a year or less permits only five days per month deduction from the term of sentence. In practical effect, under this Court's order, petitioner may have to serve 11 days' additional time. The Court should require petitioner to proceed in the regular way by Rule 35 rather than force him to serve a longer sentence, especially since his petition may result from lack of familiarity with 'good behavior' regulations. For these reasons I dissent.
1
Rule 43 of the Federal Rules of Criminal Procedure provides:
'The defendant shall be present at the arraignment, at every stage of the trial including the impaneling of the jury and the return of the verdict, and at the imposition of sentence, except as otherwise provided by these rules. In prosecutions for offenses not punishable by death, the defendant's voluntary absence after the trial has been commenced in his presence shall not prevent continuing the trial to and including the return of the verdict. A corporation may appear by counsel for all purposes. In prosecutions for offenses punishable by fine or by imprisonment for not more than one year or both, the court, with the written consent of the defendant, may permit arraignment, plea, trial and imposition of sentence in the defendant's absence. The defendant's presence is not required at a reduction of sentence under Rule 35.'
2
Supra, note 1.
| 01
|
375 U.S. 71
84 S.Ct. 185
11 L.Ed.2d 137
The Honorable James B. PARSONS, Judge of the United States District Court for the Northern District of Illinois, Petitioner,v.The CHESAPEAKE & OHIO RAILWAY COMPANY.
No. 32.
Argued Oct. 23, 1963.
Decided Nov. 12, 1963.
John J. Naughton, Chicago, Ill., for petitioner.
Charles J. O'Laughlin, Chicago, Ill., for respondent.
PER CURIAM.
1
The question presented by this case is whether a federal district judge in an action brought under the Federal Employers' Liability Act is divested of all discretion to deny a § 1404(a) transfer motion,1 when a suit upon the same cause of action, earlier brought in a state court in the same city, was dismissed by the state court on the ground of forum non conveniens.
2
Jack Filbrun commenced a Federal Employers' Liability Act suit for personal injuries against the respondent railroad in the Circuit Court of Cook County, Illinois. On the respondent's motion the state court dismissed the action on the ground of forum non conveniens. Filbrun did not appeal. Instead, he filed a complaint grounded on the same cause of action in the United States District Court for the Northern District of Illinois, sitting in Chicago. The respondent filed a motion pursuant to 28 U.S.C. § 1404(a), requesting that the case be transferred to the United States District Court for the Western District of Michigan, sitting in Grand Rapids. The district judge denied the motion, and the respondent sought mandamus from the Court of Appeals for the Seventh Circuit to compel the judge to order the transfer. On rehearing, the Court of Appeals, one judge dissenting, vacated a previous judgment refusing mandamus, and issued a writ directing the transfer. 307 F.2d 924. We granted certiorari, 371 U.S. 946, 83 S.Ct. 506, 9 L.Ed.2d 496, to review the action of the Court of Appeals. We reverse the judgment for the reasons stated below.
3
Under Illinois law a state court's determination to dismiss a case on the ground of forum non conveniens requires consideration of similar factors—convenience of the parties and of witnesses and the interests of justice—to those to be considered by a federal court in applying § 1404(a).2 The Court of Appeals accordingly reasoned that every point necessary to be passed upon by the federal district judge on respondent's § 1404(a) transfer motion had already been adjudicated adversely to the plaintiff in the state court, and concluded that 'the district court had no discretion but to recognize the authoritative value of the state court's ruling, made in a case commenced there by plaintiff.' 307 F.2d, at 926.
4
The discretionary determinations of both the state and federal courts in this case required, to be sure, evaluations of similar, but by no means identical, objective criteria. However, since the material facts underlying the application of these criteria n each forum were different in several respects, principles of res judicata are not applicable to the situation here presented.
5
Thus, for example, in determining that Cook County was an inconvenient forum, the state court in this case could appropriately consider the availability of a state forum at Ludington, Michigan, where Filbrun's alleged injury had occurred. But since there is no federal court in Ludington, the federal district judge in making his determination was limited to consideration of the alternative of a trial in the federal court in Grand Rapids, a city some 60 miles from Ludington. Obviously, the question whether the convenience of the parties and of the witnesses would be better served by a trial in a state court in Ludington is not the same question as whether those interests would be better served by a trial in a federal court in Grand Rapids. Similarly, a trial judge weighing the interests of justice could legitimately consider the condition of his court's docket an important factor.3 While docket congestion is a problem facing all trial courts in large metropolitan areas, there is nothing to show that the problem in the federal court in Chicago is identical in either nature or quantity to the problem in the Cook County court system.
6
These considerations no more than illustrate the many variables which might affect the exercise of discretion by a state court, as contrasted to a federal court, in any given case. Since different factual considerations may be involved in each court's determination, we hold that a prior state court dismissal on the ground of forum non conveniens can never serve to divest a federal district judge of the discretionary power vested in him by Congress to rule upon a motion to transfer under § 1404(a).
7
In its original opinion in this case, the Court of Appeals found that there had been no abuse of discretion by the district judge in denying the motion for transfer. We do not read the opinion on rehearing as having disturbed that finding, but only as having determined that the district judge had been divested of power to exercise his discretion at all—a determination we have now found to be erroneous. Accordingly, the judgment of the Court of Appeals is reversed, and the case is remanded to the District Court for further proceedings. It is so ordered.
8
Judgment of the Court of Appeals reversed and case remanded to the District Court.
1
28 U.S.C. § 1404(a) provides: 'For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought.'
2
In addition, the state court was required to determine whether plaintiff's selection of that court was dictated by a desire to vex and harass the defendant. Cotton v. Louisville & N.R. Co., 14 Ill.2d 144, 174, 152 N.E.2d 385, 400.
3
The Supreme Court of Illinois has observed that a serious court congestion problem exists in the Cook County courts. 14 Ill.2d, at 171, 152 N.E.2d, at 398.
| 89
|
375 U.S. 59
84 S.Ct. 178
11 L.Ed.2d 128
UNITED STATES, Petitioner,v.Aaron ZACKS et al.
No. 44.
Argued Oct. 21, 1963.
Decided Nov. 21, 1963.
J. Mitchell Reese, Jr., Washington, D.C., for petitioner.
Scott P. Crampton, Washington, D.C., for respondents.
Mr. Justice HARLAN delivered the opinion of the Court.
1
The question in this case is whether § 117(q) of the Internal Revenue Code of 1939, a 1956 amendment to the Code which effected retroactive changes in the tax treatment of transfers of patent rights, gives rise to a claim for refund barred by the statute of limitations generally applicable to tax refund claims.
2
In 1952, Mrs. Zacks received royalties of about $37,000 on patents all substantial rights under which she had transferred by way of an exclusive license to a manufacturing corporation. In accordance with the then prevailing rulings of the Commissioner, the royalties were reported as ordinary income in the 1952 joint federal income tax return filed by Mrs. Zacks and her husband in 1953. The last payment of the taxes due was made in 1953. Under the statute of limitations governing a claim for refund of such taxes, the claim was barred in 1956. § 322(b)(1), Internal Revenue Code of 1939, 26 U.S.C. (1952 ed.) § 322(b)(1), 53 Stat. 91.1 By Act of June 29, 1956, 70 Stat. 404, Congress amended the provisions of the 1939 Code governing the taxability of amounts received in consideration for the transfer of patent rights. The amendment, made applicable to tax years beginning after May 31, 1950, provided that in the circumstances present here such amounts should be taxed as capital gains rather than as ordinary income.
3
In reliance on this amendment, the taxpayers, on June 23, 1958, filed a claim for a pro tanto refund of their 1952 income taxes. No action having been taken on the claim, they then commenced a refund suit in the Court of Claims. The United States asserted as a defense that the suit was barred by limitations under § 7422(a) of Internal Revenue Code of 1954, 26 U.S.C. § 7422(a), 68A Stat. 876.2 The Court of Claims granted the taxpayers' motion to strike this defense, 150 Ct.Cl. 814, 280 F.2d 829, and, other issues in the case being settled by stipulation, entered judgment for the taxpayers.
4
Because of the recurring importance of the problem in the administration of the tax laws and a conflict between the decision below and those of some of the Courts of Appeals,3 we granted certiorari. 371 U.S. 961, 83 S.Ct. 543, 9 L.Ed.2d 509. For reasons given hereafter, we hold that the taxpayers' claim was barred by limitations and, accordingly, reverse the judgment below.
5
Section 117(q) here in question provides in pertinent part:
6
'(Q) Transfer of Patent Rights.—
7
'(1) General rule.—A transfer (other than by gift, inheritance, or devise) of property consisting of all substantial rights to a patent, or an undivided interest therein which includes a part of all such rights, by any holder shall be considered the sale or exchange of a capital asset held for more than 6 months, regardless of whether or not payments in consideration of such transfer are—
8
'(A) payable periodically over a period generally coterminous with the transferee's use of the patent, or
9
'(B) contingent on the productivity, use, or disposition of the property transferred.
10
'(4) Applicability—This subsection shall apply with respect to any amount received, or payment made, pursuant to a transfer described in paragraph (1) in any taxable year beginning after May 31, 1950, regardless of the taxable year in which such transfer occurred.'
11
Since our sole concern is the intent of Congress in adding this section to the Code, it is necessary to look to the administrative and legislative background of the enactment. In 1946, the Commissioner of Internal Revenue announced his acquiescence in Myers, 6 T.C. 258, in which the Tax Court held, as to a so-called 'amateur' inventor,4 that the transfer by exclusive license of all substantial rights under a patent was a sale or exchange of a capital asset, notwithstanding that the consideration for the license was royalties based on a percentage of the selling price of articles sold under the patent, and paid annually. 1946—1 Cum.Bull. 3. On March 20, 1950, the Commissioner reversed his position and announced the withdrawal of his acquiescence in Myers, stating that royalties measured or paid as in that case would be taxed as ordinary income. Mim. 6490, 1950—1 Cum.Bull. 9. The new ruling was declared applicable to tax years beginning after May 31, 1950. In the years following 1950, the Commissioner adhered to his new position, despite its rejection by several courts.5 The issue was settled for the future in 1954 by the enactment of § 1235 of the 1954 Code, 26 U.S.C. § 1235, 68A Stat. 329. Section 1235, applicable only prospectively, contains provisions identical in relevant part to those quoted above from § 117(q).6 Thus, prior to May 31, 1950, with exceptions noted hereafter,7 and again from the beginning of 1954, the law has been that for which the taxpayers contend in their refund suit.
12
In 1955, the Commissioner issued a further ruling declaring that he would adhere to his 1950 ruling for tax years beginning after May 31, 1950, and prior to 1954. Rev.Rule 55—58, 1955—1 Cum.Bull. 97. As a result, the Commissioner's position was that during the period from May 31, 1950 to 1954 there was a gap in the consistent application of the law as administratively and judicially established in 1946. It is evident that Congress intended to fill this gap when it enacted § 117(q) in 1956. But we are not able to say that Congress intended thereby to reopen for retroactive adjustment tax years with respect to which refund claims were already barred by limitations.
13
Section 117(q) does not in terms waive the application of the statute of limitations to refund claims then finally barred. On its face, § 117(q) does no more than overrule the Commissioner's position on a matter of substantive law respecting the years 1950 1954. Nor is there anything in the legislative history which suggests that such a waiver is to be implied. On the contrary, such indications as there are suggest that Congress intended only to terminate litigation then pending. Representative Cooper, then Chairman of the House Ways and Means Committee, stated on the floor of the House:
14
'The relief provided by section 1235 (of the 1954 Code) is available only with respect to amounts received in any taxable year to which the 1954 Code applies. As the result of this and the announced policy of the Internal Revenue Service to continue its insistence on its position for years beginning after May 31, 1950, and prior to effective date of the 1954 Code taxpayers are still confronted with litigation for taxable years falling in this period in order to secure the rights to which the courts, with practical unanimity, have held they are entitled.
15
'H.R. 6143 (the original version of § 117(q)) eliminates the necessity for such litigation by making the provisions of the 1954 Code available to years beginning after May 31, 1950.' 101 Cong.Rec. 12708 (Aug. 1, 1955).
16
There are other indications that Congress had only this limited intention. It is abundantly clear that Congress is aware of the limitations problem as it affects retroactive tax legislation. On numerous occasions, Congress has included an express provision reopening barred tax years. We need refer here to only a few examples. Section 14 of the Technical Amendments Act of 1958, 26 U.S.C. § 172(f)(3), (4), (g)(3), 72 Stat. 1606, 1611, provided rules for computing net operating loss deductions for tax years starting in 1953 and extending into 1954 and short tax years wholly within 1954. Subsection (c), added to the House bill by the Senate, provided expressly for a six-month period during which barred claims could be made. The addition was explained in the Senate report as follows:
17
'Your committee did amend the House provision, however, in one respect because 3 years have now el psed since 1954 and many of the transitional years with which this provision is concerned are now closed years. To prevent relief from being denied in such cases, your committee amends this provision to provide that if a refund or credit with respect to this provision is prevented on the date of enactment of this bill or within 6 months after that time by the operation of any law or rule of law (except closing agreements or compromises) refund or credit, nevertheless, is to be allowed if the claim is filed within 6 months of the date of enactment of this bill.' S.Rep. No. 1983, 85th Cong., 2d Sess. 24.
18
Again, by Act of August 9, 1955, 69 Stat. 607, Congress provided a one-year grace period for filing otherwise barred claims based on § 345 of the Revenue Act of 1951, 65 Stat. 452, 517, a retroactive relief measure affecting trust income accumulated for members of the Armed Services dying in active service on or after December 7, 1941, and before January 1, 1948. The House report on the bill stated:
19
'No relief was provided in the 1951 act, however, for cases where refunds or credits were barred by the expiration of the period of limitations, by prior court decisions, or for other similar reasons. Your committee is of the opinion that this failure was an oversight, and it believes that it is only equitable to extend treatment equivalent to that provided in section 345 of the Revenue Act of 1951 to cases where refunds or credits were barred by operation of law or rule of law (other than closing agreements or compromises).' H.R.Rep. No. 1438, 84th Cong., 1st Sess. 1—2.8
20
The most striking evidence of this sort, however, which we think is all but conclusive, is found in § 2 of the very Act here in dispute. That section, retroactively modifying § 106 of the 1939 Code, affected the taxation of payments received by a taxpayer from the United States with respect to a claim arising out of a construction contract for the Armed Services. Subsection (b) deals with the limitations problem as follows:
21
'(b) The amendment made by this section shall apply with respect to taxable years ending after December 31, 1948, notwithstanding the operation of any law or rule of law (other than section 3760 of the Internal Revenue Code of 1939 or section 7121 of the Internal Revenue Code of 1954, relating to closing agreements, and other than section 3761 of the Internal Revenue Code of 1939 or section 7122 of the Internal Revenue Code of 1954, relating to compromises). Notwithstanding the preceding sentence, no claim for credit or refund of any overpayment resulting from the amendment made by this section shall be allowed or made after the period of limitation applicable to such overpayment, except that such period shall not expire before the expiration of one year after the date of the enactment of this Act.' 70 Stat. 405.
22
Section 2 went of the Conference Committee without such a provision. The Committee added the provision but made no omparable addition to § 1, with which we are concerned, or for that matter to § 3, which also made retroactive changes in the 1939 Code. It is plain, therefore, that the Congress had the limitations problem in mind at the very time that § 117(q) was enacted. The taxpayers offer no justification for disregarding the difference in this respect between §§ 1 and 2, disrespect for which would render the carefully drawn limitations provisions of the latter section surplusage.
23
Both the taxpayers and the Government rely on United States v. Borden Co., 308 U.S. 188, 198, 60 S.Ct. 182, 188, 84 L.Ed. 181, where this Court said: 'It is a cardinal principle of construction that repeals by implication are not favored. When there are two acts upon the same subject, the rule is to give effect to both if possible.' The correctness of this statement is not to be doubted. But the paucity of its assistance here is illustrated by the fact that both parties rely on it. The taxpayers place the second sentence in italics, and urge that § 117(q) and the general statute of limitations are both given effect if the limitations period is made to run from the date of enactment of § 117(q). The Government presses the first sentence, and urges that the taxpayers' position, in effect, repeals the statute of limitations pro tanto. There are difficulties with both of these analyses. Obviously, neither of them does more than cast a conclusion in terms of the general rules isolated from the particular circumstances of this case. Nor can the doctrine that remedial legislation is entitled to liberal construction, upon which the taxpayers also rely, be stretched to expand the reach of a statute of such evident limited purpose as this one.
24
A more difficult question is presented by the fact that § 117(q) goes beyond the problem created by the Commissioner's vacillation affecting tax years between 1946 and 1954. By treating royalty payments as capital gains without regard to whether the patent rights transferred were capital assets, § 117(q) made the favorable treatment available to professional as well as amateur inventors.9 In addition, all royalties are treated as longterm capital gains whether or not the rights transferred had been held for the requisite period. These provisions made clear changes in the law as it was in 1950 and subsequent years up to 1954. Insofar as they are applicable to years for which most claims for refund were barred in 1956, the Government's position renders the provisions without effect.
25
It is, of course, our duty to give effect to all portions of a statute if that is possible. E.g., United States v. Menasche, 348 U.S. 528, 538—539, 75 S.Ct. 513, 519—520, 99 L.Ed. 615. But this general principle is meant to guide the courts in furthering the intent of the legislature, not overriding it. When rigid adherence to the general rule would require disregard of clear indications to the contrary, the rule must yield. Two considerations compel that result here. First, not only the administrative and legislative history of § 117(q), discussed above, but also the selection of May 31, 1950, as the operative date leave no doubt that Congress was primarily concerned to settle the large volume of pending litigation arising ut of the Commissioner's 1950 position, reaffirmed in 1955.10 The date selected has no relevance either to the status of professional inventors or to the period for which patent rights must be held. Second, there is a ready explanation for the inclusion of the additional provisions. With irrelevant exceptions, § 117(q) tracks the language of § 1235 of the 1954 Code. Pp. 61—62 and note 6, supra. It was wholly natural for Congress to deal with the pre-1954 period by adopting the language of the 1954 Code on the same subject. The House report on the bill leaves no doubt that this is what actually occurred. H.R.Rep. No. 1607, 84th Cong., 1st Sess. 1—2. It is fair inference that but for the Commissioner's obduracy respecting amateur inventors, § 117(q) would not have been conceived. There is nothing to indicate that for some other reason Congress in 1956 had second thoughts about its failure in 1954 to make these identical provisions of § 1235 retroactive. To give the provisions in question the controlling weight that is claimed for them on the issue before us, would allow the tail to wag the dog. Of course, all of the amendatory provisions of § 117(q) are fully effective with respect to years and claims not barred.
26
Finally, the taxpayers suggest that unless the statute of limitations is deemed waived, a premium is placed on taxpayer opposition to administrative rulings, since only those taxpayers who contested the Commissioner's position will now be able to claim a refund. But in view of the doubt surrounding the rulings involved in this case, emphasized by the cases overruling the Commissioner, this argument has less force than it might in another context. In any event, this problem always attends retroactive legislation of this sort, and acceptance of the taxpayers' argument would lead to the automatic waiver of the statute of limitations in every case. Whether or not this should be done is a matter for Congress to decide. Where Congress has decided otherwise, this Court has but one course.
27
Reversed.
28
Mr. Justice BLACK agrees with the Court of Claims and would affirm its judgment.
29
Mr. Justice DOUGLAS took no part in the consideration or decision of this case.
1
Section 322(b)(1) provides:
'Unless a claim for credit or refund is filed by the taxpayer within three years from the time the return was filed by the taxpayer or within two years from the time the tax was paid, no credit or refund shall be allowed or made after the expiration of whichever of such periods expires the later. If no return is filed by the taxpayer, then no credit or refund shall be allowed or made after two years from the time the tax was paid, unless before the expiration of such period a claim therefor is filed by the taxpayer.' Similar provisions are contained in § 6511(a), (b) of the Internal Revenue Code of 1954, 26 U.S.C. § 6511(a), (b), 68A Stat. 808.
2
Section 7422(a) provides:
'No suit or proceeding shall be maintained in any court for the recovery of any internal revenue tax alleged to have been erroneously or illegally assessed or collected, or of any penalty claimed to have been collected with authority, or of any sum alleged to have been excessive or in any manner wrongfully collected, until a claim for refund or credit has been duly filed with the Secretary or his delegate, according to the provisions of law in that regard, and the regulations of the Secretary or his delegate established in pursuance thereof.'
3
Compare United States v. Dempster, 265 F.2d 666 (C.A.6th Cir.), and Tobin v. United States, 264 F.2d 845 (C.A.5th Cir.), with the decision in this case and Hollander v. United States, 248 F.2d 247 (C.A.2d Cir.), involving a similar problem.
4
One not engaged in holding patent rights "primarily for sale to customers in the ordinary course of his trade or business," 6 T.C. 266, as distinguished from a 'professional' inventor who is so engaged.
5
See Kronner v. United States, 110 F.Supp. 730, 126 Ct.Cl. 156; Allen v. Werner, 190 F.2d 840 (C.A.5th Cir.). The Commissioner's position was sustained by the Second Circuit i Bloch v. United States, 200 F.2d 63.
Prior to 1946, several courts had taken the same position. Commissioner v. Celanese Corp., 78 U.S.App.D.C. 292, 140 F.2d 339; Commissioner v. Hopkinson, 126 F.2d 406 (C.A.2d Cir.).
6
The relevant portions of § 1235 are:
'A transfer (other than by gift, inheritance, or devise) of property consisting of all substantial rights to a patent, or an undivided interest therein which includes a part of all such rights, by any holder shall be considered the sale or exchange of a capital asset held for more than 6 months, regardless of whether or not payments in consideration of such transfer are—
'(1) payable periodically over a period generally coterminous with the transferee's use of the patent, or
'(2) contingent on the productivity, use, or disposition of the property transferred.'
7
Section 1235 of the 1954 Code, and § 117(q) of the 1939 Code which follows § 1235, made changes in the prior law with respect to the status of professional inventors and the 'holding period' for both amateur and professional inventors. See pp. 67 69, infra.
8
For other examples of retroactive tax measures in which express provision was made for the limitations problem, see Technical Amendments Act of 1958, §§ 92, 93, 100, 72 Stat. 1606, 1667, 1668, 1673; Act of September 14, 1960, § 5, 74 Stat. 1010, 1013; Revenue Act of 1962, §§ 26, 27, 76 Stat. 960, 1067.
For examples of such measures in which no provision was made to extend the period of limitations, see Act of February 11, 1958, 72 Stat. 3; Act of February 11, 1958, 72 Stat. 4; Technical Amendments Act of 1958, § 103, 72 Stat. 1606, 1675; Revenue Act of 1962, § 30, 76 Stat. 960, 1069.
Contrary to fears seemingly entertained by one of the Amici in this case, we do not suggest that congressional practice in this regard gives rise to a presumption that where Congress has not provided expressly for a special limitations period in a retroactive tax statute, the relevant general statute of limitations was intended to apply. The significance of such congressional silence is to be judged on a case-by-case basis, as with all questions of statutory construction.
9
Such rights would not be capital assets if the patents were held for sale in the ordinary course of business. Internal Revenue Code of 1954, § 1221, 26 U.S.C. § 1221, 68A Stat. 321.
The taxpayers make much of the asserted fact that Mrs. Zacks was a professional inventor, reasoning therefrom that as to her at least § 117(q) clearly established a new right. Cf. Lorenz v. United States, 296 F.2d 746, 155 Ct.Cl. 751. The Court of Claims made no finding as to whether Mrs. Zacks was an amateur or professional inventor. Whatever may be the validity and significance in other contexts of the distinction between creation of new rights and clarification of existing rights, we think that distinction is not controlling here, since Congress has evidenced its intent more directly.
10
The existence of a substantial amount of such litigation is not questioned in this case. Some of it has been collected at pages 35—36 of the Government's brief.
| 1112
|
375 U.S. 79
84 S.Ct. 187
11 L.Ed.2d 159
Morris GOTTHILF, Petitioner,v.Benjamin SILLS, Morton Sills and Sills of Cambridge, Inc.
No. 50.
Argued Oct. 24, 1963.
Decided Nov. 18, 1963.
O. John Rogge, New York City, for petitioner.
Theodore Charnas, New York City, for respondents.
PER CURIAM.
1
The Supreme Court of New York County issued an order granting body execution (N.Y.Civ.Prac.Act § 764) against petitioner for failure to pay a money judgment which had been finally entered against him in that court in an action premised on fraud and deceit. On appeal to the Appellate Division, First Judicial Department, petitioner attacked § 764 as being violative of both the state and federal constitutions. The order was affirmed, 17 A.D.2d 723. Petitioner then filed a motion in the Court of Appeals of New York for leave to appeal (N.Y.Civ.Prac.Act § 589) which was dismissed for want of jurisdiction because 'the order sought to be appealed from does not finally determine the action within the meaning of the Constitution.' 12 N.Y.2d 761, 234 N.Y.S.2d 714, 186 N.E.2d 563. See Chase Watch Corp. v. Heins, 283 N.Y. 564, 27 N.E.2d 282 (1940); cf. Knickerbocker Trust Co. v. Oneonta, C. & R.S.R. Co., 197 N.Y. 391, 90 N.E. 1111 (1910). An appeal to the Court of Appeals as of right (N.Y.Civ.Prac.Act § 588) was dismissed on the same ground. 12 N.Y.2 792, 235 N.Y.S.2d 379, 186 N.E.2d 811. Certiorari was granted to review the judgment of the Appellate Division, First Judicial Department. 372 U.S. 957, 83 S.Ct. 1012, 10 L.Ed.2d 11.
2
Section 589 of the New York Civil Practice Act provides inter alia that appeals from nonfinal orders can only be taken to the Court of Appeals by leave of the Appellate Division upon certified questions. The petitioner at no time applied to the Appellate Division for such permission. It therefore appears that the Appellate Division, First Judicial Department, 'was not the last state court in which a decision of that (constitutional) question could be had.' Gorman v. Washington University, 316 U.S. 98, 100, 62 S.Ct. 962, 963, 83 L.Ed. 1300 (1942). The judgment of the Appellate Division is not that of the 'highest court of a State in which a decision could be had' within the meaning of 28 U.S.C. § 1257. Whether, under the same section, that judgment is 'final,' a question of purely federal law, involves entirely different considerations. The petition for certiorari was therefore improvidently granted and the writ is
3
Dismissed.
4
Writ dismissed.
5
Mr. Justice DOUGLAS, with whom THE CHIEF JUSTICE and Mr. Justice BLACK concur, dissenting.
6
The majority concludes that petitioner is not seeking review of the decision of the 'highest court of a State in which a decision could be had' within the meaning of 28 U.S.C. § 1257. It is said that petitioner could have, by employment of the certified question procedure, obtained a full review of his constitutional questions by the New York Court of Appeals, but instead chose a route that resulted in the dismissal of his appeal.
7
The determination of the Court of Appeals that this body execution order is a nonfinal order subject to appeal only via the certified question route came as a surprise. Theretofore, the one and only New York case involving a body execution order and the question of how one should obtain review in the Court of Appeals was Chase Watch Corp. v. Heins, 283 N.Y. 564, 27 N.E.2d 282, decided in 1940. The creditor took an appeal from an order of the Appellate Division vacating an order authorizing body execution. 258 App.Div. 968, 17 N.Y.S.2d 880. The Court of Appeals dismissed on the ground that the order was not final, giving the creditor, however, 20 days within which to seek certification of a question from the Appellate Division. This was done (259 App.Div. 888, 18 N.Y.S.2d 742) and the creditor ultimately prevailed (284 N.Y. 129, 29 N.E.2d 646). It is argued that the Chase Watch case clearly established the type of procedure that petitioner should have followed. The vacation of a body execution order, however, as in Chase Watch, is far less final than the converse, which is the present case. In Chase Watch, the order determined nothing finally; the creditor was merely momentarily frustrated in his collection efforts, and was forced to rely on other devices. Here, on the other hand, the debtor faces incarceration; he has fought for his right to remain out of jail; and he has lost. If he lacks money with which to pay the judgment, nothing further is available for him by New York law. The case illustrates that concepts of finality in one context cannot always be transferred to another.
8
In my opinion, petitioner might reasonably have concluded that a final order had been entered in this case and that Chase Watch did not control. Therefore, his action in docketing an appeal in the Court of Appeals, and not invoking the certification procedures applicable only to nonfinal orders, was justifiable as a matter of federal law. The decision of the Court of Appeals in this case establishes, of course, as a matter of state law that the order was not final. While that determination is binding on us, it does not preclude us from holding that the decision was sufficiently unexpected so as not to bar, in the interests of justice, the certiorari route here. See NAACP v. Alabama, 357 U.S. 449, 457—458, 78 S.Ct. 1163, 1169, 2 L.Ed 2d 1488:
9
'Novelty in procedural requirements cannot be permitted to thwart review in this Court applied for by those who, in justified reliance upon prior decisions, seek vindication in state courts of their federal constitutional rights.'
10
The current decision was a surprise which could not reasonably be anticipated, and it was then too late for petitioner to avail himself of the new procedure.
11
While 28 U.S.C. § 1257 also requires that judgments brought here for review be 'final,' we have recognized an exception sometimes even to the point of reviewing interlocutory decrees where the controversy has proceeded to a point where the 'losing party (will) * * * be irreparably injured if review (is) * * * unavailing.' Republic Natural Gas Co. v. Oklahoma, 334 U.S. 62, 68, 68 S.Ct. 972, 976, 92 L.Ed. 1212. Unless the case is reviewed now, petitioner goes to jail—or stays outside New York.
12
In my opinion the case is properly here* and the Court should consider, on the merits, the constitutional questions presented.
*
There is no suggestion that after the Court of Appeals dismissed the appeal, petitioner should have repaired once more to the Appellate Division for a certificate or in the words of Section 592, subd. 5(c) of the New York Civil Practice Act 'for permission to appeal.' It should be noted, however, that this procedure is available only with qualifications, as that subsection makes the granting of the application contingent not only on the discretion of the Appellate Division but also on the explicit proviso 'that the proceedings have not been improperly delayed.'
| 89
|
375 U.S. 85
84 S.Ct. 229
11 L.Ed.2d 171
Harold FAHY, Petitioner,v.STATE OF CONNECTICUT.
No. 19—October Term, 1963.
Argued Oct. 16, 1963.
Decided Dec. 2, 1963.
Francis J. McNamara, Jr., Stamford, Conn., for petitioner.
John F. McGowan, Bridgeport, Conn., for respondent.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
Petitioner waived trial by jury and was convicted in a Connecticut state court of wilfully injuring a public building in violation of Connecticut General Statutes § 53—45(a). Specifically, petitioner and his codefendant Arnold1 were found guilty of having painted swastikas on a Norwalk, Connecticut, synagogue. The trial took place before our decision in Mapp v. Ohio, 367 U.S. 643, 81 S.Ct. 1684, 6 L.Ed.2d 1081, but the conviction was affirmed on appeal after that decision. Connecticut v. Fahy, 149 Conn. 577, 183 A.2d 256 (1962). At the trial of the case, a can of black paint and a paint brush were admitted into evidence over petitioner's objection. On appeal, the Connecticut Supreme Court of Errors held that the paint and brush had been obtained by means of an illegal search and seizure. It further held that the Mapp decision applies to cases pending on appeal in Connecticut courts at the time that decision was rendered, and, therefore, the trial court erred in admitting the paint and brush into evidence. However, the court affirmed petitioner's conviction because it found the admission of the unconstitutionally obtained evidence to have been harmless error.2 We granted certiorari, 372 U.S. 928, 83 S.Ct. 871, 9 L.Ed.2d 732 (1963).
2
On the facts of t is case, it is not now necessary for us to decide whether the erroneous admission of evidence obtained by an illegal search and seizure can ever be subject to the normal rules of 'harmless error' under the federal standard of what constitutes harmless error. Compare Ker v. California, 374 U.S. 23, 83 S.Ct. 1623, 10 L.Ed.2d 726. We find that the erroneous admission of this unconstitutionally obtained evidence at this petitioner's trial was prejudicial; therefore, the error was not harmless, and the conviction must be reversed. We are not concerned here with whether there was sufficient evidence on which the petitioner could have been convicted without the evidence complained of. The question is whether there is a reasonable possibility that the evidence complained of might have contributed to the conviction. To decide this question, it is necessary to review the facts of the case and the evidence adduced at trial.
3
On February 1, 1960, between the hours of 4 and 5 a.m., swastikas were painted with black paint on the steps and walls of a Norwalk synagogue. At about 4:40 a.m., Officer Lindwall of the Norwalk police saw an automobile being operated without lights about a block from the synagogue. Upon stopping the car, Lindwall found that Fahy was driving and Arnold was a passenger. Lindwall questioned Fahy and Arnold about their reason for being out at that hour, and they told him they had been to a diner for coffee and were going home. Lindwall also checked the car and found a can of black paint and a paint brush under the front seat. Having no reason to do otherwise, Lindwall released Fahy and Arnold. He followed the car to Fahy's home. Later the same morning, Lindwall learned of the painting of the swastikas. Thereupon, he went to Fahy's home and—without having applied for or obtained an arrest or search warrant—entered the garage under the house and removed from Fahy's car the can of paint and the brush. About two hours later, Lindwall returned to the Fahy home, this time in the company of two other Norwalk policemen. Pursuant to a valid arrest warrant, the officers arrested Fahy and Arnold.
4
At trial, the court admitted the paint and brush into evidence over petitioner's objection. We assume, as did the Connecticut Supreme Court of Errors, that doing so was error because this evidence was obtained by an illegal search and seizure and was thus inadmissible under the rule of Mapp v. Ohio. Examining the effect of this evidence upon the other evidence adduced at trial and upon the conduct of the defense, we find inescapable the conclusion that the trial court's error was prejudicial and cannot be called harmless.
5
Obviously, the tangible evidence of the paint and brush was itself incriminating. In addition, it was used to corroborate the testimony of Officer Lindwall as to the presence of petitioner near the scene of the crime at about the time it was committed and as to the presence of a can of paint and a brush in petitioner's car at that time. When Officer Lindwall testified at trial concerning that incident, the following transpired:
6
'Q. Will you tell the court what you found in the car?
7
'A. Checking on the passengers' side, under the front seat I found a small jar of paint and a paint brush.
8
'Q. Are you able to identify this object I show you?
9
'A. Yes.
10
'Q. What is it?
11
'A. A jar of paint I found in the motor vehicle.
12
'Q. I show you this object and ask you if you can identify that.
13
'A. Yes, sir.
14
'Q. What is it?
15
'A. A paint brush.
16
'Q. Where did you first see this paint brush?
17
'A. Under the front seat of Mr. Fahy's car.'
18
The brush and paint were offered in evidence and were received over petitioner's objection. The trial court found: '13. The police found the same can of black paint and the brush in the car which the defendants had been operating when stopped by Officer Lindwall earlier in the morning.' It can be inferred from this that the admission of the illegally seized evidence made Lindwall's testimony far more damaging than it would otherwise have been.
19
In addition, the illegally obtained evidence was used as the basis of opinion testimony to the effect that the paint and brush matched the markings on the synagogue, thus forging another link between the accused and the crime charged. At trial, Norwalk Police Officer Tigano testified that he had examined the markings on the synagogue and had determined that they were put on with black paint. He further testified that he had examined the contents of the can illegally seized from Fahy's car and had determined that it contained black paint. Even more damaging was Tigano's testimony that he had taken the illegally seized brush to the synagogue 'to measure the width of the brush with the width of the paintings of the swastikas.' Over objection, Tigano then testified that the brush 'fitted the same as the paint brush in some drawings of the lines and some it did not due to the fact the paint dripped.' Thus the trial court found: '14. The two-inch paint brush matched the markings made with black paint upon the synagogue.' In relation to this testimony, the prejudicial effect of admitting the illegally obtained evidence is obvious.
20
Other incriminating evidence admitted at trial concerned admissions petitioner made when he was arrested and a full confession made at the police station later. Testifying at trial, Norwalk Police Lieutenant Virgulak recounted what took place when Fahy, who was just waking up at the time, was arrested:
21
'I told him I (sic, he) was under arrest for painting swastikas on the synagogue. He said, 'Oh, that?' and he appeared to lay back in bed.
22
'Q. Did you have any further conversation with Fahy before you reached the police station that you remember? 'A. I asked him what the reason was for painting the swastikas and he said it was only a prank and I asked him why and he said for kicks.'
23
At the police station, there was further questioning, and Fahy told Lieutenant Virgulak that he, Fahy, would take the responsibility for painting the swastikas. In addition, some hours after the arrest Arnold was asked to give a statement of the events, and he complied, dictating a complete confession of two typewritten pages. After this confession was admitted against Arnold at trial, Lieutenant Virgulak testified that he had read the confession to Fahy and:
24
'Q. After you finished reading it, will you tell us whether or not he (Fahy) made any comment?
25
'A. I asked him what his version was and he said the story was as I had it from Mr. Arnold. I asked him if he would like to give a written statement and he declined.'
26
The record does not show whether Fahy knew that the police had seized the paint and brush before he made his admissions at the time of arrest and en route to the police station. In oral argument, however, counsel for the State told the Court that Fahy 'probably' had been told of the search and seizure by then. Of course, the full confession was more damaging to the defendants, and unquestionably the defendants knew the police had obtained the paint and brush by the time they confessed. But the defendants were not allowed to pursue the illegal search and seizure inquiry at trial, because, at the time of trial, the exclusionary rule was not applied in Connecticut state courts. Thus petitioner was unable to claim at trial that the illegally seized evidence induced his admissions and confession. Petitioner has told the Court that he would so claim were he allowed to challenge the search and seizure as illegal at a new trial. And we think that such a line of inquiry is permissible. As the Court has noted in the past: 'The essence of a provision forbidding the acquisition of evidence in a certain way is that not merely evidence so acquired shall not be used before the Court but that it shall not be used at all.' See Silverthorne Lumber Co. v. United States, 251 U.S. 385, 392, 40 S.Ct. 182, 183, 64 L.Ed. 319; see also Nardone v. United States, 308 U.S 338, 60 S.Ct. 266, 84 L.Ed. 307; Wong Sun v. United States, 371 U.S. 471, 83 S.Ct. 407, 9 L.Ed.2d 441. Thus petitioner should have had a chance to show that his admissions were induced by being confronted with the illegally seized evidence.
27
Nor can we ignore the cumulative prejudicial effect of this evidence upon the conduct of the defense at trial. It was only after admission of the paint and brush and only after their subsequent use to corroborate other state's evidence and only after introduction of the confession that the defendants took the stand, admitted their acts, and tried to establish that the nature of those acts was not within the scope of the felony statute under which the defendants had been charged.3 We do not mean to suggest that petitioner has presented any valid claim based on the privilege against self-incrimination. We merely note this course of events as another indication of the prejudicial effect of the erroneously admitted evidence.
28
From the foregoing it clearly appears that the erroneous admission of this illegally obtained evidence was prejudicial to petitioner and hence it cannot be called harmless error. Therefore, the conviction is reversed, and the cause is remanded for proceedings not inconsistent with this opinion. It is so ordered.
29
Reversed and remanded.
30
Mr. Justice HARLAN, whom Mr. Justice CLARK, Mr. Justice STEWART and Mr. Justice WHITE join, dissenting.
31
The only question in this case which merits consideration by this Court, and which alone accounts for the case being here at all, is that which the majority does not reach: Does the Fourteenth Amendment prevent a State from applying its harmless-error rule in a criminal trial with respect to the erroneous admission of evidence obtained through an unconstitutional search and seizure? The majority avoids this issue only by disregarding the finding of the Connecticut Supreme Court of Errors that the erroneously admitted evidence was without prejudicial effect on the outcome of petitioner's trial.
32
Evidentiary questions of this sort are not a proper part of this Court's business, particularly in cases coming here from state courts over which this Court possesses no supervisory power. This is not the rare instance of a state conviction which rests upon a record that is devoid of any evidence to support the charge against the defendant, see Thompson v. Louisville, 362 U.S. 199, 80 S.Ct. 624, 4 L.Ed.2d 654; Garner v. Louisiana, 368 U.S. 157, 82 S.Ct. 248, 7 L.Ed.2d 207. The most that can be said is that the record leaves the issue of harmless error open to differing conclusions. That, however, furnishes no ground for this Court's intervention, even in the name of avoiding the constitutional question which brought the case here.
33
Furthermore, taking the Court's opinion on its own bottom, I feel compelled to say, with due respect, that I am unable to understand its evaluation of the record. The opinion below provides the full answer to the petitioner's claim that the admission into evidence of the can of paint and paint brush prejudiced him:
34
'* * * The defendants do not claim, nor, as the transcript shows, could they claim, that the illegal search and seizure induced their admissions or confessions. Their claim is that, '(h)ad they been able to preclude the admission of the illegally seized evidence, (their) confessions would not have been admissible,' under the rule of State v. Doucette, 147 Conn. 95, 98, 157 A.2d 487, because there was, apart from the confessions, in ufficient evidence of the corpus delicti, that is, that the crime charged had been committed by someone. In other words, their claim is that the state, in order to prove that a crime had been committed, had to rely solely on the admission in evidence of the paint jar and the brush. The answer to that claim is that there was ample evidence besides the defendants' confessions and the jar of paint and the brush to prove that swastikas had been painted on the synagogue between the hours of 4 and 5 o'clock on the morning of February 1, 1960. This was sufficient to establish that the crime charged had been committed by someone. The confessions were not inadmissible on the ground claimed, and no other ground of inadmissibility is advanced.
35
'The paint jar and the brush, which were exhibits, were, at most, cumulative. The transcript of the evidence of the state's case, in chief, discloses overwhelming evidence of the guilt of the defendants. They were observed a block from the scene of the crime at approximately the time when it was committed, riding in an automobile without lights, and were brought to a stop only after a police officer had pursued them for upwards of a mile. When the police later in the morning came with warrants to arrest them, they admitted their guilt at once and attempted to excuse their conduct as a 'prank.' Both later freely confessed. * * *' 149 Conn. 577, 587—588, 183 A.2d 256, 261 262.
36
The Court's discussion of corroborative and cumulative evidence and its effect on the conduct of the defense is surely beside the point in a case in which both before and during trial it was not disputed that the petitioner had committed the acts in question and the only defense raised was that the acts were not criminal as charged.1
37
This brings me to the question which the Court does not reach: Was it constitutionally permissible for Connecticut to apply its harmless-error rule to save this conviction from the otherwise vitiating effect of the admission of the unconstitutionally seized evidence? I see no reason why not. It is obvious that there is no necessary connection between the fact that evidence was unconstitutionally seized and the degree of harm caused by its admission. The question of harmless error turns not on the reasons for inadmissibility but on the effect of the evidence in the context of a particular case. Erroneously admitted 'constitutional' evidence may often be more prejudicial than erroneously admitted 'unconstitutional' evidence. Since the harmless-error rule plainly affords no shield under which prosecutors might use damaging evidence, unconstitutionally obtained, to secure a conviction, there is no danger that application of the rule will undermine the prophylactic function of the rule of inadmissibility.
38
Cases in which this Court has held that the sufficiency of other evidence will not validate a conviction if an unconstitutionally obtained confession is introduced at trial, e.g., Malinski v. New York, 324 U.S. 401, 65 S.Ct. 781, 89 L.Ed. 1029, are inapposite. It may well be that a confession is never to be considered as nonprejudicial. In any event, the standard applied here required a determination that exclusion of the unconstitutional evidence could not have changed the outcome of the trial. That is a much stricter standard than that of independently sufficient evidence, which leaves open the possibility that the trier of fact did rely on the unconstitutional evidence and, therefore, would have reached a different conclusion if the evidence had been excluded.2
39
I would affirm.
1
Arnold was tried and convicted with petitioner Fahy, and their appeals were heard and decided together. Arnold also filed a petition for certiorari; however, that petition was dismissed on Arnold's motion before we granted Fahy's petition.
2
Connecticut's statutory harmless error rule states that the Supreme Court of Errors need not reverse a judgment below if it finds the errors complained of 'have not materially injured the appellant.' Connecticut General Statutes § 52—265 (1958).
3
The Connecticut Supreme Court of Errors rejected petitioner's argument that painting swastikas on a synagogue was 'defacement,' not 'injury,' to a public building. The statute involved was passed in 1832 and made it illegal to 'injure or deface' a public building. In 1875, the words 'or deface' were omitted, and the statute remained essentially unchanged thereafter. The Connecticut Supreme Court of Errors held that 'injure' includes defacement and thus includes petitioner's acts.
1
As the quoted portion of the opinion below shows, our Court, by relying on the petitioner's statement that he would claim at a new trial that the unlawfully seized evidence induced his admissions and confession, accepts a claim which, apart from its lack of foundation in the record, is made for the first time here.
2
There is no need to consider whether a state or federal standard of harmless error governs, since the state standard applie here is as strict as any possible federal standard.
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375 U.S. 136
84 S.Ct. 235
11 L.Ed.2d 208
Israel DRESNER et al., Petitioners,v.CITY OF TALLAHASSEE, FLORIDA.
No. 35.
Argued Oct. 23, 1963.
Decided Dec. 2, 1963.
Howard Dixon, Miami, Fla., and Carl Rachlin, New York City, for petitioners.
Edward J. Hill and Roy T. Rhodes, Tallahassee, Fla., for respondent.
PER CURIAM.
1
Considering that there are questions of Florida law answers to which are necessary to enable this Court to determine its jurisdiction over this cause, and with respect to which there appear to be no precise controlling precedents in the decisions of the Supreme Court of Florida, this Court desires to certify to the Supreme Court of Florida, pursuant to Rule 4.61 of the Florida Appellate Rules, 31 F.S.A., the questions stated hereafter.
2
The petitioners have been tried and convicted in the Municipal Court of Tallahassee for unlawful assembly, under a municipal ordinance which incorporates by reference the state unlawful assembly statute.1 The convictions were affirmed in the Circuit Court of the Second Judicial District, Leon County, Florida.2 The unreported opinion of that court, a copy of which, taken from the record, is attached to this certificate as an Appendix, contains a statement of the facts on which the convictions rested. The petitioners sought certiorari in this Court, which the City of Tallahassee opposed on the ground, inter alia, that the judgment of the Circuit Court was not 'rendered by the highest court of a State in which a decision could be had,' as required by 28 U.S.C. § 1257. This Court granted certiorari, 372 U.S. 963, 83 S.Ct. 1087, 10 L.Ed.2d 128, and subsequently directed counsel to file briefs on the jurisdictional issue, which counsel have done.
3
The questions which this Court desires to certify are:
4
1. On a timely petition for writ of certiorari or other process, does the Florida District Court of Appeal or any other court of Florida have jurisdiction to review a judgment of the Circuit Court affirming a conviction in the Municipal Court of a violation of a municipal ordinance which incorporates a state statute by reference, where the questions presented for review concern the federal constitutionality of the ordinance on its face and as applied?
5
2. If the District Court of Appeal or any other court of Florida does have such jurisdiction and had granted review in this case by way of a writ of certiorari or other process, would it have been empowered to consider fully each of the following contentions, all indisputably properly preserved:
6
(a) 'Petitioners were peaceable and orderly at all times; hence, there was no evidence whatsoever to support the convictions below for unlawful assembly, and therefore Petitioners have been denied due process of law under the Fourteenth Amendment';
7
(b) 'The convictions constituted a violation of Petitioners' rights of freedom of speech and freedom of assembly as guaranteed by the Fourteenth Amendment'; (c) 'The arrests and convictions herein constituted an undue burden on interstate commerce in violation of the interstate commerce clause of the Federal Constitution';
8
(d) 'The arrests and convictions herein constituted a denial of the equal protection of the laws guaranteed by the Fourteenth Amendment'?
9
If not, in what respects would the scope of review have been limited?
10
The Clerk of this Court is directed to transmit this certificate, signed by The Chief Justice and under the official seal of the Court, to the Supreme Court of Florida, and simultaneously to transmit copies thereof to the attorneys for the respective parties.
11
APPENDIX.
12
OPINION OF THE CIRCUIT COURT OF THE SECOND JUDICIAL CIRCUIT, LEON COUNTY, FLORIDA.*
13
Order Affirming Judgments.
14
This is an appeal from convictions in the Municipal Court of the City of Tallahassee, Florida of the ten appellants named in the caption who were charged with unlawful assembly. A fine was assessed against each of them with an alternative jail sentence.
15
The formal charge is in a single count naming the ten appellants and three others1 as defendants and alleges an unlawful assembly on June 16, 1961 'in that, they being more than three (3) persons, met together to commit a breach of the peace, acting together and concertedly to occupy and continuously occupy certain chairs and seating facilities in the Tallahassee Municipal Airport, making and cancelling group airline reservations on the two (2) operating airline schedules departing Tallahassee on said date, and on June 15, 1961, and meeting together in concert attendant with circumstances calculated to excite alarm, endanger the public peace and excite fear, and in such nature as to inspire well-grounded fear in persons of reasonable courage, of riot, or other breaches of public peace, and while so unlawfully assembled' were commanded by a police officer of the city, after identifying himself as such, to immediately and peaceably disperse, and they refused or neglected to do so.
16
The appellants contend that the judgments pursuant to convictions violate their rights guaranteed by the Florida and United States Constitutions in that they have been denied the equal protection of the laws and have been deprived of liberty or property with ut due process of law. They contend that the state statute, Chap. 61—237, Laws of 1961, (F.S. § 870.04, F.S.A.), (which, by reference adoption in a municipal ordinance,2 is made an ordinance of the City of Tallahassee) is unconstitutional and void, either on its face or as it has been applied to the appellants in this case.
17
The pertinent portions of the statute, adopted as an ordinance, are:
18
'If any number of persons * * * are unlawfully, riotously or tumultuously assembled in any * * * city or municipality * * * any * * * police officer of said city or municipality * * * shall go among the persons so assembled * * * and shall in the name of the state command all the persons so assembled immediately and peaceably to disperse; and if such persons do not thereupon immediately and peaceably disperse, said (officer) shall command the assistance of all persons in seizing, arresting and securing such persons in custody; and if any person present * * * when required by such (officer) to depart from the place, refuses or neglects to do so, he shall be deemed one of the * * * persons unlawfully assembled, and may be prosecuted and punished accordingly.'
19
The facts in the case are not in dispute and squarely present the question as to whether or not the conduct of the appellants was an exercise by them of rights they hold under state and federal constitutional provisions, which would preclude their prosecution, conviction and sentence for unlawful assembly in the trial court.
20
The appellants are clergymen, two being rabbis and the others being ordained ministers of several Protestant denominations. They are residents of New Jersey, New York, Massachusetts or Connecticut. Some of them are of the white race and some are negroes. About June 12 or 13, 1961 they, together with eight other clergymen from the same general area, departed from Washington, D.C. by interstate common carrier bus for a so-called 'Freedom Ride' into Virginia, the Carolinas, Georgia, and Florida. The bus ride terminated in Tallahassee June 15, 1961. The 'Freedom Riders' left their buses at the Greyhound bus terminal there and went into the terminal lunch room to obtain food which was served them.
21
This trip was sponsored and at least partially financed by an organization known as CORE (Congress on Racial Equality) which has been aggressive in promoting racial integration and desegregation. The trip was well publicized, having been given wide coverage in all news media including radio and television. The time and place of arrival in Tallahassee was heralded and well known.
22
The purposes of the 'Freedom Ride', as stated by appellant Collier, who was the spokesman for the group, were two-fold: (1) To ascertain whether or not there were facilities available on an integrated basis to interstate passengers in waiting rooms, in rest rooms, in eating facilities in the terminals through which they would pass; and (2) To bear witness as ministers, rabbis and clergymen to the struggle to obtain those rights 'guaranteed us by the Constitution.'
23
Shortly prior to the time the buses bearing the 'Freedom Riders' were scheduled to arrive at about noon on June 15, there had gathered in the vicinity of the bus station a number of persons and groups of persons. Law enforcement officers, including city police, had been dispatched to the area to prevent any disturbance. It was suspected that resentment against the 'Freedom Riders' might result in some attempts at violence toward them or precipitate other disorders. When the buses arrived, law enforcement personnel moved in any gave protection to the passengers as they left the bus and entered the lunch room in the terminal. Apparently they were served in the lunchroom under circumstances and pol cies satisfactory to them.
24
In approximately an hour after arrival at the bus terminal the eighteen 'Freedom Riders' proceeded to the Tallahassee Municipal Airport ostensibly for the purpose of boarding a 3:25 P.M. Eastern Air Lines plane for passage to Washington, Newark, or New York. They were transported to the airport in private cars presumably furnished by local sympathizers with their objectives.
25
Upon arrival at the airport they found that the restaurant there had been closed. When the time approached for arrival of the 3:25 plane the ten appellants cancelled the reservation they had previously made for the flight. The other eight boarded the plane when it arrived and departed for their destinations in the East.
26
At that time, the airport arrangement provided separate waiting rooms, or areas, for white and negro; also separate rest rooms; and separate areas for serving food, the white area being a glassedin place and the negro consisting of a counter with several stools. However, as mentioned before, the eating service had been discontinued by the closing of the restaurant facilities. A sandwich vending machine was in the lobby, but the prices on same had been marked up from previous prices.
27
The appellants stayed together in a more or less compact group in the lobby area most of the time and no attempt was made to enforce separation of the races in the waiting room. Rest rooms were used by them without observing the designation of the segregated facilities.
28
After cancelling their reservations for the 3:25 P.M. flight they sought and ultimately obtained reservations for a flight the next morning at 8:25 on an E.A.L. plane. They remained in the airport until about 11:00 P.M. that evening for the purpose of observing if the restaurant would open and service be granted to them. The restaurant remained closed.
29
Law enforcement officers, including city police, were detailed to keep order. The activities and objectives of the appellants had been the subject of news reporting and groups of people were seen to be gathering or attempting to gather in the vicinity of the airport. There were critical and hostile comments made about the appellants. The police turned away some of those gathering when it was apparent such persons had no airport business or interest. Persons were even screened at the entrance and turned away by officers if they had no business to transact at the airport.
30
The chief of police advised the appellants that the airport terminal would close for the night at approximately 11:45 P.M. and a spokesman for appellants requested protection as they moved from the airport into the city and also on the return to the airport the next morning. Such protection by escort of law enforcement officers was provided.
31
The appellants thus left the airport at about 11:00 P.M. on the 15th to return the next morning prior to the scheduled departure at 8:25 A.M. of the plane on which they had obtained reservations. They were given escort security protection on both the occasions of leaving and returning to the terminal.
32
The restaurant was also closed on the morning of June 16. At 8:15 A.M. all ten of the appellants cancelled their reservations for the 8:25 flight and remained in the waiting room after that flight had departed. At 8:20 A.M. they sought, and ultimately obtained, reservations on a National Airlines flight scheduled to depart at 1:47 P.M. that day, but cancelled just prior to noon.
33
During these periods there continued to be movements and gatherings of groups of people in cars and there was a hostility and open resentment against the conduct and attitudes of the appellants. A considerable number of police, sheriff's deputies and highway patrolmen had been detailed to prevent disorder. City, county and state officials, including the Governor, were apprehensive and moved to provide necessary law enforcement personnel to preserve order.
34
At about 12:15 P.M., Mr. James Messer, Jr., city attorney of Tallahassee and a specia police officer of the city, after conferring with the mayor and chief of police of the city, approached the appellants who were together and inquired if there was a leader of the group. Appellant Collier arose and identified himself and assumed to act as spokesman. Mr. Messer identified himself and his official positions, exhibiting his police badge. Others in the group gathered around Mr. Messer and Rev. Collier and Mr. Messer read to them a proclamation. He stated that the assembly of the appellants at the Municipal Airport of Tallahassee will tend to create a disturbance or incite a riot or disorderly conduct within the City of Tallahassee at its Municipal Airport over which the city had jurisdiction. He mentioned incidents of the previous night and fears of more unrest. He then commanded them in the name of the state and city to immediately and peaceably disperse, and explained that such meant from the airport property. He then added that failure to so disperse would result in arrest for unlawful assembly. Collier asserted that they were interstate passengers, to which Messer replied that he did not consider them to be bona fide passengers in view of their reservation cancellations.
35
Several local sympathizers with the appellants dispersed, but appellants failed to do so. After about 1 1/2 minutes, Mr. Messer turned to the Chief of Police and remarked 'Chief, you can carry out your orders.' The appellants were arrested and taken into custody.
36
The appellants take the view that the segregation practices with regard to waiting rooms, rest room facilities, and restaurant or eating facilities at the airport were violative of constitutional guarantees of equal protection of the law. They would also inject into the case the installation of sandwich and cigarette machines, at or just prior to their arrival, which inflated the prices of merchandise vended to double what it had been. The closing of the restaurant on the day of their arrival and its opening shortly after their departure is viewed as an important factor.
37
These facts are, in the view of this Court, not at all significant in the legal problems involved in the charge against the appellants and the disposition of such charge by the trial court.
38
The municipality of Tallahassee operates in a proprietary capacity and in a governmental capacity. Among its proprietary functions is the ownership and operation of a municipal airport and supervision over the concessions there. Assuming, but not deciding, that its policies of segregation of the races in its facilities are unlawful and did constitute a violation of some duty to the appellants if enforced against them, and further assuming, without deciding, that the closing of the restaurant under the circumstances violated some duty to them, do such circumstances justify a concerted protest demonstration by appellants of their views and convictions over a protracted period of time during which tensions and tempers rise in the community which threaten to erupt into disorder and thus render the city, in its governmental capacity, powerless to terminate the demonstration in the exercise of its police power?
39
Stated another way, may not a lawful assembly for the purpose of protesting and demonstrating opposition to a course of policy practiced by the municipality become an unlawful assembly when pursued to unreasonable lengths imposing unreasonable burdens on others, after the lawful objectives of the demonstration had been fairly accomplished?
40
It is fundamental that our constitutions accord to the citizen of the United States the right of freedom of speech and of assembly and to peaceably petition for a redress of grievances. Such freedoms are jealously guarded and when exercised in good faith and in good order may not be lawfully, interfered with by governmental action. However, it is not a license to take into one's own hands the enforcement of law or by excessive harassment, effect coercion and acceptance of one's convictions and interpre ations of legal rights by governmental entities whose policies are in conflict. Such procedures wholly ignore the very machinery provided by the constitutions and laws of the nation and state for the declaring, securing and enforcement of constitutional and other legal rights. It is the courts, both state and federal, to whom resort is readily available for citizens to seek recognition and enforcement of legal rights and immunities. That such courts may not move as swiftly as the individual would wish does not authorize pursuit of personal means which unnecessarily create or threaten public disturbance or disorder, or which sustaintially interfere with normal, orderly functions of a public facility.
41
Such a procedure is a form of anarchy which, if it becomes an accepted practice, can have only the effect of seriously weakening orderly government.
42
The appellants, prior to the reading of the riot act to them, had achieved their announced objectives. They had observed both at the bus station and the airport the integration or lack of it of the waiting room, rest room and restaurant facilities. They had very effectively borne witness as clergymen and otherwise of their sympathy with the struggle to obtain desegregation of the various facilities of interstate travel.
43
To accommodate and facilitate those legitimate objectives the law enforcement agencies of city, county and state had given protection against potential violence or other disorder from groups or individuals who resented the activities of the appellants. This protection was afforded at the bus station, at the airport on the afternoon of June 15, on the evening of June 15 when the appellants left the airport to come into town and on the following morning when they returned to the airport purportedly to take an early plane. However, instead of using the reservations they had otained they made a cancellation. This was thrice they had made last minute cancellations of reservations for the sole reason that they wished to eat in the restaurant, which was closed. In the meantime their conduct and persistence was arousing increased resentment and anger in the community with threats of violence and disorder toward the appellants.
44
Obviously, the conduct of appellants had revealed a pattern. They would make reservations for travel, wait in the lobby until just before the plane they were scheduled to take arrived and then cancel, make reservations on a later flight and then again cancel at the last minute, at all times remaining in the airport but never taking a plane. The effect is obvious. The seats and other facilities are occupied by them and their use denied to those who actually wished to travel. The use of rest rooms and wash rooms by them partakes more of lodging than a comfort feature for those whose sole purpose is some airport business. The reservation of space and last minute cancellations prevented the use of that space of the flights involved, resulting in loss and inconvenience to the air line involved and probable denial to other would-be travelers of the use of that space. The sole purpose of such a course of harassment was to goad the municipality and its restaurant lessee to open the restaurant and gratify the appellants' wishes that they be served in the style and manner they deemed to be their right.
45
Controversies between citizens and governmental units are not unique. In nearly every instance there is a conflict in what the citizen contends he has a right to claim and the governmental entity which would deny the validity of such claim. The citizen may freely express his views and seek to cultivate converts to them with a view of bringing moral or political pressures on the officers of the public body to accord his demands. However, such means must be exercised in a manner that is reasonable and not harmful to the rights of others or the peace and good order of the community. Especially is this true when the controversy is one of public interest in which there are strong a d emotional feelings on the part of a substantial number of persons in the community.
46
The courts, both state and federal, are open to resolve controversies on constitutional issues in duly instituted and processed civil actions. Indeed, the very issue in the demonstrations of the appellants was subsequently presented to and adjudicated by the United States District Court for the Northern District of Florida. Brooks, et al. v. Tallahassee, D.C., 202 F.Supp. 56. When citizens press their demonstrations in behalf of a cause (however worthy they deem their objectives to be) beyond the bounds of fully and effectively delivering their message and reach the stage that they materially and harmfully interfere with the orderly business and lawful activities of others who are acting in public or private capacities, then the conduct is disorderly and assembly for carrying it out is unlawful. Such was the case here.
47
The judgments appealed from are hereby affirmed.
48
Affirmed.
49
BEN C. WILLIS, Circuit Judge.
1
Section 23—38 of the Tallahassee Code, which provides that it shall be unlawful for any person to commit an act which is or shall be recognized by the laws of the State as a misdemeanor.
Chapter 61—237, Laws of 1961, Florida Statutes § 870.04, F.S.A., provides:
'If any number of persons, whether armed or not, are unlawfully, riotously or tumultuously assembled in any county, city or municipality, the sheriff or his deputies, or any constable or justice of the peace of the county, or the mayor, or any commissioner, councilman, alderman or police officer of the said city or municipality, or any officer or member of the florida (sic) highway patrol, shall go among the persons so assembled, or as near to them as may be with safety, and shall in the name of the state command all the persons so assembled immediately and peaceably to disperse; and if such persons do not thereupon immediately and peaceably disperse, said officers shall command the assistance of all persons in seizing, arresting and securing such persons in custody; and if any person present being so commanded to aid and assist in seizing and securing such rioter or persons so unlawfuly assembled, or in suppressing such riot or unlawful assembly, refuses or neglects to obey such command, or, when required by such officers to depart from the place, refuses and neglects to do so, he shall be deemed one of the rioters or persons unlawfully assembled, and may be prosecuted and punished accordingly.'
The State refers in its brief to a Tallahassee ordinance specifically prohibiting unlawful assembly, which is also included in the record by stipulation of the parties. This ordinance is similar in substance to the state statute quoted above. However, all parties seemingly have proceeded on the premise that the petitioners were charged and convicted only under the general ordinance which incorporated the state statute. The Circuit Court plainly decided the case on that basis. See Appendix, p. 237.
2
The petitioners appealed their convictions directly to the Supreme Court of Florida. The Supreme Court ruled that it lacked jurisdiction and ordered the appeal transferred to the Circuit Court. Fla., 134 So.2d 228.
After the convictions were affirmed in the Circuit Court and prior to the filing of a petition for certiorari in this Court, the petitioners attempted to file, and subsequently withdrew, a petition for certiorari in the District Court of Appeal.
*
Entered August 16, 1962. (Footnote supplied.)
1
Of these three one was acquitted and the other two were granted a nolle prosequi. (Original footnotes renumbered.)
2
Sec. 23—38, Tallahassee Code, provides that it shall be unlawful for any person to commit any act which is or shall be recognized by the laws of the state as a misdemeanor. The penalty is a maximum fine of $500.00 or 60 days imprisonment or both.
| 89
|
375 U.S. 96
84 S.Ct. 219
11 L.Ed.2d 179
RETAIL CLERKS INTERNATIONAL ASSOCIATION, LOCAL 1625, AFL-CIO et al., Petitioners,v.Alberta SCHERMERHORN et al.
No. 13.
Reargued Oct. 16, 17, 1963.
Decided Dec. 2, 1963.
[Syllabus from 96 intentionally omitted]
S. G. Lippman, Washington, D.C., for petitioners.
Bernard B. Weksler, Miami, Fla., for respondents.
Archibald Cox, Sol. Gen., for the United States, as amicus curiae, by special leave of Court.
Mr. Justice DOUGLAS delivered the opinion of the Court.
1
The sole question in the case is the one we set down for reargument in 373 U.S. 746, 747—748, 83 S.Ct. 1461, 10 L.Ed. 678: 'whether the Florida courts, rather than solely the National Labor Relations Board, are tribunals with jurisdiction to enforce
[Amicus Curiae intentionally omitted] the State's prohibition' against an 'agency shop' clause in a collective bargaining agreement.
2
In this case the union and the employer negotiated a collective bargaining agreement that contained an 'agency shop' clause providing that the employees covered by the contract who chose not to join the union were required 'to pay as a condition of employment, an initial service fee and monthly service fees' to the union. Nonunion employees brought suit in a Florida court to have the agency shop clause declared illegal, for an injunction against enforcement of it, and for an accounting. The Florida Supreme Court held that this negotiated and executed union-security agreement violates the 'right to work' provision of the Florida Constitution and that the state courts have jurisdiction to afford a remedy. Fla., 141 So.2d 269.
3
We agree with that view.
4
While § 8(a)(3) of the Taft-Hartley Act provides1 that it is not an unfair labor practice for an employer and a union to require membership in a union as a condition of employment provided the specified conditions are met, § 14(b) (61 Stat. 151, 29 U.S.C. § 164(b)) provides:
5
'Nothing in this Act shall be construed as authorizing the execution or application of agreements requiring membership in a labor organization as a condition of employment in any State or Territory in which such execution or application is prohibited by State or Territorial law.'
6
We start from the premise that, while Congress could preempt as much or as little of this interstate field as it chose, it would be odd to construe § 14(b) as permitting a State to prohibit the agency clause but barring it from implementing its own law with sanctions of the kind involved here.
7
Section 14(b) came into the law in 1947, some years after the Wagner Act. The latter did not bar as a matter of federal law an agency-shop agreement.2 Section 8 (a)(3) of the Taft-Hartley Act also allowed it, saying that 'nothing in this Act, or in any other statute of the United States, shall preclude' one.3
8
By the time § 14(b) was written into the Act, twelve States had statutes or constitutional provisions outlawing or restricting the closed shop and related devices4—a state power which we sustained in Lincoln Federal Labor Union v. Northwestern Iron & Metal Co., 335 U.S. 525, 69 S.Ct. 251, 93 L.Ed. 212. These laws about which Congress seems to have been well informed during the 1947 debates5—had a wide variety of sanctions, including injunctions, damage suits, and criminal penalties. In 1947 Congress did not outlaw union-security agreements per se; but it did add new conditions, which, as presently provided in § 8(a)(3),6 require that there be a 30-day waiting period before any employee is forced into a union, that the union in question is the appropriate representative of the employees, and that an employer not discriminate against an employee if he has reasonable grounds for believing that membership in the union was not available to the employee on a nondiscriminatory basis or that the employee's membership was denied or terminated for reasons other than failure to meet union-shop requirements as to dues and fees. In other words, Congress undertook pervasive regulation of union-security agreements, raising in the minds of many whether it thereby preempted the field under the decision in Hill v. Florida, 325 U.S. 538, 65 S.Ct. 1373, 89 L.Ed. 1782, and put such agreements beyond state control. That is one reason why a section, which later became § 14(b), appeared in the House bill7—a provision described in the House Report8 as making clear and unambiguous the purpose of Congress not to preempt the field. That purpose was restated by the House Conference Report in explaining § 14(b).9 Senator Taft in the Senate deates stated that § 14(b) was to continue the policy of the Wagner Act and avoid federal interference with state laws in this field. As to the Wagner Act he stated, 'But that did not in any way prohibit the enforcement of State laws which already prohibited closed shops.'10 (Italics added.) He went on to say, 'That has been the law ever since that time. It was the law of the Senate bill; and in putting in this express prov sion from the House bill, (§ 14(b)) we in no way change the bill as passed by the Senate of the United States.11
9
In light of the wording of § 14(b) and this legislative history, we conclude that Congress in 1947 did not deprive the States of any and all power to enforce their laws restricting the execution and enforcement of union-security agreements. Since it is plain that Congress left the States free to legislate in that field, we can only assume that it intended to leave unaffected the power to enforce those laws. Otherwise the reservation which Senator Taft felt to be so critical would become empty and largely meaningless.
10
As already noted, under § 8(a)(3) a union-security agreement is permissible, for example, if the union represents the employees as provided in § 9(a) (subject to rescission of the authority to make the agreement as provided in § 8(a)(3)). Those are federal standards entrusted by Congress to the Labor Board. Yet even if the union-security agreement clears all federal hurdles, the States by reason of § 14(b) have the final say and may outlaw i . There is thus conflict between state and federal law; but it is a conflict sanctioned by Congress with directions to give the right of way to state laws barring the execution and enforcement of union-security agreements. It is argued that if there is a violation of a state union-security law authorized by § 14(b), it is a federal unfair labor practice and that the federal remedy is the exclusive one. It is urged that that course is necessary if uniformity is to be achieved. But § 14(b) gives the States power to outlaw even a union-security agreement that passes muster by federal standards. Where Congress gives state policy that degree of overriding authority, we are reluctant to conclude that it is nonetheless enforceable by the federal agency in Washington.
11
This result on its face may seem to be at war with San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775, decided in 1959, and holding that where action is 'arguably subject to § 7 or § 8 of the Act, the States as well as the federal courts must defer to the exclusive competence of the National Labor Relations Board.' 359 U.S. at 245, 79 S.Ct. at 780, 3 L.Ed.2d 775. In Garmon a state court was held precluded by the Taft-Hartley Act from awarding damages under state law for economic injuries resulting from peaceful picketing of a plant by labor unions that had not been selected by a majority of the employees as their bargaining agents.
12
Garmon, however, does not state a constitutional principle; it merely rationalizes the problems of coexistence between federal and state regulatory schemes in the field of labor relations; and it did not present the problems posed by § 14(b), viz., whether the Congress had precluded state enforcement of select state laws adopted pursuant to its authority. The purpose of Congress is the ultimate touchstone. Congress under the Commerce Clause may displace state power (Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 234—236, 67 S.Ct. 1146, 91 L.Ed. 1447; San Diego Bldg. Trades Council v. Garmon, supra) or it may even by silence indicate a purpose to let state regulation be imposed on the federal regime. See Florida Lime & Avocado Growers v. Paul, 373 U.S. 132, 141—143, 83 S.Ct. 1210, 10 L.Ed.2d 248.
13
The Court in Algoma Plywood & Veneer Co. v. Wisconsin Emp. Relations Board, 336 U.S. 301, 314, 69 S.Ct. 584, 591, 93 L.Ed. 691 stated that '§ 14(b) was included to forestall the inference that federal policy was to be exclusive' on this matter of union-security agreements. In that case a state agency issued a cease-and-desist order against an employer from giving effect to a maintenance of membership agreement and ordered an employee reinstated and made whole for any loss of pay suffered. It was urged that since § 10(a) of the Wagner Act gives the Federal Board 'exclusive' power to prevent 'any unfair labor practice,' state power in the federal commerce field was displaced. 336 U.S. at 305, 69 S.Ct. at 587, 93 L.Ed. 691. State power, however, was held to exist alongside of federal power because of the special legislative history of the union-security provisions of the Act. The dissent did not deny that; rather it proceeded on the ground that, since the dispute arose prior to the 1947 Act, the case was to be judged by the pre-1947 construction of § 8(a)(3), as to which the majority and minority of the Court were in disagreement.
14
It also was argued in Algoma Plywood & Veneer Co. that § 14(b) displaced state law that 'regulates' the union shop. The Court said:
15
'But if there could be any doubt that the language of the section means that the Act shall not be construed to authorize any 'application' of a union-security contract, such as discharging an employee, which under the circumstances 'is prohibited' by the State, the legislative history of the section would dispel it.' 336 U.S., at 314, 69 S.Ct. at 591, 93 L.Ed. 691.
16
Congress, in other words, chose to abandon any search for uniformity in dealing with the problems of state laws barring the executi n and application of agreements authorized by § 14(b) and decided to suffer a medley of attitudes and philosophies on the subject.
17
As a result of § 14(b), there will arise a wide variety of situations presenting problems of the accommodation of state and federal jurisdiction in the union-security field. As noted, Algoma Plywood & Veneer Co. v. Wisconsin Emp. Relations Board, supra, upheld the right of a State to reinstate with back pay an employee discharged in violation of a state union-security law. On the other hand, picketing in order to get an employer to execute an agreement to hire all-union labor in violation of a state union-security statute lies exclusively in the federal domain (Local Union 429 etc. v. Farnsworth & Chambers Co., 353 U.S. 969, 77 S.Ct. 1056, 1 L.Ed.2d 1133, and Local No. 438 v. Curry, 371 U.S. 542, 83 S.Ct. 531, 9 L.Ed.2d 514), because state power, recognized by § 14(b), begins only with actual negotiation and execution of the type of agreement described by § 14(b). Absent such an agreement, conduct arguably an unfair labor practice would be a matter for the National Labor Relations Board under Garmon.
18
We held in Local 100 of United Ass'n of Journeymen and Apprentices v. Borden, 373 U.S. 690, 83 S.Ct. 1423, 10 L.Ed.2d 638, and in Local 207 Intern. Ass'n of Bridge, Structural and Ornamental Iron Workers Union v. Perko, 373 U.S. 701, 83 S.Ct. 1429, 10 L.Ed.2d 646, that Garmon preempted the field where employees were suing unions for damages arising out of practices that arguably were unfair labor practices subject to regulation by the National Labor Relations Board. Those cases, however, did not present for decision any problem under § 14(b), though the question was tendered in the Borden case but not passed on either by the state tribunal or by us. 373 U.S., at 692, 83 S.Ct., at 1431, n. 2.
19
The relief prayed for below is within the ambit of Algoma Plywood & Veneer Co. v. Wisconsin Emp. Relations Board, supra, and the regulatory scheme that Congress designed when it adopted § 14(b).
20
Affirmed.
21
Mr. Justice GOLDBERG took no part in the consideration or decision of this case.
1
Section 8(a)(3) reads as follows:
'It shall be an unfair labor practice for an employer * * * by discrimination in regard to hire or tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization: Provided, That nothing in this Act, or in any other statute of the United States, shall preclude an employer from making an agreement with a labor organization (not established, maintained, or assisted by any action defined in section 8(a) of this Act as an unfair labor practice) to require as a condition of employment membership therein on or after the thirtieth day following the beginning of such employment or the effective date of such agreement, whichever is the later, (i) if such labor organization is the representative of the employees as provided in section 9(a), in the appropriate collective-bargaining unit covered by such agreement when made; and (ii) unless following an election held as provided in section 9(e) within one year preceding the effective date of such agreement, the Board shall have certified that at least a majority of the employees eligible to vote in such election have voted to rescind the authority of such labor organization to make such an agreement: Provided, further, That no employer shall justify any discrimination against an employee for nonmembership in a labor organization (A) if he has reasonable grounds for believing that such membership was not available to the employee on the same terms and conditions generally applicable to other members, or (B) if he has reasonable grounds for believing that membership was denied or terminated for reasons other than the failure of the employee to tender the periodic dues and the initiation fees uniformly required as a condition of acquiring or retaining member hip.' 61 Stat. 140—141, as amended, 65 Stat. 601, 73 Stat. 525, 29 U.S.C. (Supp. IV) §§ 158(a)(3).
2
As stated in the Senate Report on the Wagner Act:
'* * * the bill does nothing to facilitate closed-shop agreements or to make them legal in any State where they may be illegal; it does not interfere with the status quo on this debatable subject but leaves the way open to such agreements as might now legally be consummated * * *.' S.Rep. No. 573, 74th Cong., 1st Sess., pp. 11—12. Prior to enactment of the Wagner Act in 1935, the States had unquestioned power to regulate or prohibit the closed shop and other forms of union-security agreements. While § 8(3) of the Wagner Act said 'nothing in this Act, * * * or in any other statute of the United States, shall preclude' such agreements, it left open the power of a State to 'preclude' them.
3
Note 1, supra.
4
See State Laws Regulating Union-Security Contracts, 21 L.R.R.M. 66.
5
H.R.Rep. No. 245, 80th Cong., 1st Sess., p. 34; S.Rep. No. 105, 80th Cong., 1st Sess., p. 6.
6
Note 1, supra; H.R.Rep. No. 245, 80th Cong., 1st Sess., p. 9. As to the differences between agreements for 'closed' shops, 'union' shops, and related devices, see Lincoln Federal Labor Union v. Northwestern Iron & Metal Co., supra, 335 U.S. at 528, n. 2, 69 S.Ct. at 253; American Federation of Labor v. American Sash Co., 335 U.S. 538, 550—553, 69 S.Ct. 258, 93 L.Ed. 222.
7
Section 13 of H.R. 3020, 80th Cong., 1st Sess., 1 Leg.Hist. of the Labor Management Relations Act, 1947, 207—208.
8
'Since by the Labor Act Congress preempts the field that the act covers insofar as commerce within the meaning of the act is concerned, and since when this report is written the courts have not finally ruled upon the effect upon employees of employers engaged in commerce of State laws dealing with compulsory unionism, the committee has provided expressly in section 13 that laws and constitutional provisions of any State that restrict the right of employers to rquire employees to become or remain members of labor organizations are valid, notwithstanding any provision of the National Labor Relations Act. In reporting the bill that became the National Labor Relations Act, the Senate committee to which the bill had been referred declared that the act would not invalidate any such State law or constitutional provision. The new section 13 is consistent with this view.' H.R.Rep. No. 245, 80th Cong., 1st Sess., p. 44.
9
H.R.R.ep. No. 510, 80th Cong., 1st Sess., p. 60; U.S.Code Cong.Service 1947, p. 1166:
'Under the House bill there was included a new section 13 of the National Labor Relations Act to assure that nothing in the act was to be construed as authorizing any closed shop, union shop, maintenance of membership, or other form of compulsory unionism agreement in any State where the execution of such agreement would be contrary to State law. Many States have enacted laws or adopted constitutional provisions to make all forms of compulsory unionism in those States illegal. It was never the intention of the National Labor Relations Act * * * to preempt the field in this regard so as to deprive the States of their powers to prevent compulsory unionism. Neither the so-called 'closed shop' proviso in section 8(3) of the existing act nor the union shop and maintenance of membership proviso in section 8(a)(3) of the conference agreement could be said to authorize arrangements of this sort in States where such arrangements were contrary to the State policy. To make certain that there should be no question about this, section 13 was included in the House bill. The conference agreement, in section 14(b), contains a provision having the same effect.' (Italics added.)
10
93 Cong.Rec. 6520, 2 Leg.Hist. of the Labor Management Relations Act, 1947, 1597.
11
Ibid.
| 910
|
375 U.S. 150
84 S.Ct. 224
11 L.Ed.2d 217
CHICAGO & EASTERN ILLINOIS RAILROAD CO. et al.v.UNITED STATES et al.
No. 275.
Supreme Court of the United States
December 2, 1963
Richard M. Freeman and F. F. Vesper, for appellants.
Solicitor General Cox, Assistant Attorney General Orrick, Lionel Kestenbaum, Elliott H. Moyer, Robert W. Ginnane and Stanton P. Sender, for the United States and Interstate Commerce Commission.
Richard J. Murphy, John W. Hanifin and Robert H. Bierma, for rail carrier appellees.
PER CURIAM.
1
The motion to add the Baltimore and Ohio Railroad Company et al., as parties appellee, is granted. The motions to affirm are granted and the judgment is affirmed.
2
Mr. Justice BLACK, with whom Mr. Justice DOUGLAS concurs, dissenting.
3
In the Transportation Act of 1940 Congress amended the Interstate Commerce Act to authorize the Interstate Commerce Commission to regulate rates of interstate water carriers as well as of railroads and motor carriers. 54 Stat. 929, 49 U.S.C. § 901 et seq. At the time the Act was passed there was active opposition in Congress from those who feared that the Commission in exercising the power granted it would be too 'railroad-minded.' 84 Cong.Rec. 5965; see also id., at 5880—5883. For this reason, as was pointed out in Interstate Commerce Comm'n v. Mechling, 330 U.S. 567, 574—577, 67 S.Ct. 894, 897—899, 91 L.Ed. 1102, and Interstate Commerce Comm'n v. Inland Waterways Corp., 319 U.S. 671, 692, 63 S.Ct. 1296, 1307, 87 L.Ed. 1655 (dissenting opinion), the draftsmen of the legislation specifically wrote into the Act the 'National Transportation Policy,' 54 Stat. 899, 49 U.S.C. preceding § 1, making explicit the command of Congress that there should be a 'fair and impartial regulation of all modes of transportation subjec to the provisions of this Act, so administered as to recognize and preserve the inherent advantages of each.' In the Mechling case, decided in 1947, and several times in recent years this Court and District Courts have had to protect inland barge lines from Commission action which would have frustrated the intent of Congress to secure for them the benefit of the inherent advantages of their low-cost mode of carriage. See generally Arrow Transportation Co. v. Southern R. Co., 372 U.S. 658, 673, 83 S.Ct. 984, 992, 10 L.Ed.2d 52 (dissenting opinion). Sometimes the Commission has used procedural delaying devices to deny barge lines their inherent advantage over railroads, see Arrow Transportation Co. v. United States, 176 F.Supp. 411 (D.C.N.D.Ala.), aff'd sub nom. State Corporation Comm'n v. Arrow Transportation Co., 361 U.S. 353, 80 S.Ct. 406, 4 L.Ed.2d 3621 again, the Commission has taken away the inherent advantage of barge lines through 'the device of a joint rate allowed carriers by rail but denied carriers by water,' see Dixie Carriers, Inc., v. United States, 351 U.S. 56, 59, 76 S.Ct. 578, 580, 100 L.Ed. 934. Sometimes, as in the present case, the Commission has resorted to use of inadequate or obscure findings of fact. See, e.g., Interstate Commerce Comm'n v. Mechling, 330 U.S. 567, 67 S.Ct. 894, 91 L.Ed. 1102; see also Mechling Barge Lines, Inc., v. United States, 368 U.S. 324, 331, 82 S.Ct. 337, 341, 7 L.Ed.2d 317 (dissenting opinion).2 And barge lines have been denied the benefit of their inherent advantage when railroad rates challenged and later found to be unlawful have been permitted to take effect because of the long delay of the Commission in passing upon their unlawfulness.3
4
Therefore it may be significant that the Commission in the present case, at the instance of the large Eastern railroads and without finding basic facts to support its conclusion, disallowed as non-compensatory a proposed joint rate of a small railroad and a barge line which would give shippers of coal from West Virginia and eastern Kentucky to Chicago the advantage of a rate appreciably less than that charged by the Eastern railroads for the same haul. 315 I.C.C. 129. In doing this the Commission denies ths small railroad the right to ship coal for a division of $2.04 per ton in a barge-rail rate and leaves it with no alternative, if it wants this business, but to accept a division of $1.66 per ton for a substantially identical haul in combination with one of the large Eastern railroads. The obscure report of the Commission leaves an impression that its order may, in violation of the congressional will, have nullified an inherent advantage of the barge line and the cooperating railroad. It is true that the Commission clearly found as an ultimate fact that the joint barge-rail rate was noncompensatory, and also set forth a series of figures which it said represented elements of cost and added them together to obtain a figure 5.6 cents per ton higher than the proposed rate. I have checked the Commission's addition, and find it correct. But when I turn to what should be the basic findings of fact to support the accuracy of these figures, any illusory clarity in the Commission's report vanishes. I have examined the report with all the care of which I am capable in an effort to determine whether its ultimate conclusion is supported by substantial evidence. I am compelled to say that the Commission could have informed me just as well if it had written its so-called findings in ancient Sanskrit. I get no more enlightenment from the findings of fact and law of the District Court which left this Commission order standing on the legal assumption, plainly erroneous under decisions of this Court as I shall later point out, that the Commission's ultimate conclusion was enough, without the support of basic findings of fact. Nor have the labored and at times inconsistent efforts of government counsel and counsel for the Eastern railroads been successful in transforming the Commission's 'findings' into meaningful English. Nevertheless, our Court approves both the action of the Commission and the ruling of the District Court without even permitting the proponents of the barge-rail rate to be heard in oral argument. While such summary treatment often is warranted,4 I am constrained to say that in the present case it is so unjustified as to deny the right of direct appeal from the District Court which Congress authorized, see 28 U.S.C. § 1253, and which should never be treated lightly since it makes ours the only existing court of review. I am sorry that the Court has not chosen to write an opinion to support its affirmance. I must admit for myself that I would find the task impossible and the attempt embarrassing.
5
Summary affirmance is particularly out of place here because the District Court proceeded on a clearly incorrect assumption of law, one contrary on its face to the command of Congress in the Administrative Procedure Act, and one which, in being approved here, apparently overrules a line of previous decisions of this Court. The District Court ruled that 'the Commission is only required to set out ultimate and not evidentiary facts supporting its conclusions.' With this contrast the requirement of § 8(b) of the Administrative Procedure Act, 5 U.S.C. § 1007(b), that '(a)ll decisions * * * shall * * * include a statement of (1) findings and conclusions, as well as the reasons or basis therefor, upon all the material issues of fact * * *.' Contrast also statements by this Court that '(fi)ndings based on the evidence must embrace the basic facts which are needed to sustain the order,' Morgan v. United States, 298 U.S. 468, 480, 56 S.Ct. 906, 911, 80 L.Ed. 1288, and that '(w)e have repeatedly emphasized the need for clarity and completeness in the basic or essential findings on which administrative orders rest.' Colorado-Wyoming Gas Co. v. Federal Power Comm'n, 324 U.S. 626, 634, 65 S.Ct. 850, 854, 89 L.Ed. 1235. See also, e.g., Atchison, T. & S.F.R. Co. v. United States, 295 U.S. 193, 201—202, 55 S.Ct. 748, 752, 79 L.Ed. 1382; Florida v. United States, 282 U.S. 194, 215, 51 S.Ct. 119, 125, 75 L.Ed. 291.
6
The insufficiency of the Commission's basic findings is made clearer by the facts and circumstances of this case. The Chicago and Eastern Illinois Railroad, appellant here, operates a line from the southern Indiana town of Mount Vernon, on the Ohio River, to the steel plants of the Chicago area. Most coal shipped to Chicago for steelmaking comes from the West Virginia area over the large Eastern railroads, intervening appellees, which, although authorized if not required by §§ 3(4), 15(3) and 15(4) of the Interstate Commerce Act, 24 Stat. 380, 384, as amended, 49 U.S.C. §§ 3(4), 15(3), 15(4), have refused to establish joint rates with any barge line. Some years ago the C&EI filed a tariff for hauling coal which came to Mount Vernon by barge. The Eastern roads protested. The Commission refused to approve a rate lower than $2.045 per ton, which it found to be the C&EI's 1957 cost. 308 I.C.C. 87; 310 I.C.C. 181. The C&EI then turned to the Ohio River Company, a barge line operating down the Ohio from the coal mines to Mount Vernon, and established with it a joint rate of $3.36, of which the railroad's share was to be $2.04. The joint rate saved paperwork and the expense of weighing coal transferred from the barges. The Eastern lines were charging $4.75 for the all-rail shipment.
7
The Eastern roads swiftly demanded that the ICC set aside the joint rate, claiming it was below cost and therefore illegal under § 1(5) of the Interstate Commerce Act, 24 Stat. 379, as amended, 49 U.S.C. § 1(5). Both the C&EI and the Eastern roads presented cost averages for each step of the operation. There were disputes on many factual points, and when the smoke had cleared the Commission emerged with its own set of figures, unlike that of either party, though the Commission did not make clear, and no one else in my judgment could tell, exactly why. In its opinion the Commission simply added up the figures it had mysteriously produced, found the sum to be $3.416, and held the rate proposed by the C&EI and the barge line to be illegal as 5.6 cents below cost. Review in the District Court produced some embarrassment, for both the Commission and the Eastern railroads filed briefs to demonstrate the crystal-clarity of the Commission's findings; however, their respective explanations of how the Commission had arrived at the figur it had were in part inconsistent.
8
One example should suffice to demonstrate the puzzling nature of the 'findings' which the District Court upheld. Representatives of the C&EI testified that trains from Mount Vernon would, instead of being switched and weighed as they had been before the joint tariff, pass right through the switching yard without stopping except perhaps to change crews. The Eastern lines contended that the total costs should include the costs of weighing and switching, as before. The Commission finally made no charge for weighing, but charged for switching the cars just the same. Why the cars would be switched if they were not going to be weighed is not explained. No witness for either party had suggested such a thing. This switching charge alone accounts for 4.2 cents of the 5.6 cents on which the Commission relied to invalidate the tariff. The record reveals other disputes, resolved whether by analysis, inattention or whimsy no one can tell. The Commission's lawyers urged in the District Court that even if there was no way of justifying the 4.2 cents charge, it really didn't make any difference because that alone would not suffice to bring the total costs down to the level of the tariff. In fact, said the Commission, it 'could have met all legal requirements by accepting in toto protestants' figures'; in effect, that the purpose of the hearing was not to determine what costs really were, but rather to produce a report setting forth figures to justify a conclusion. Heretofore I had thought that orders of administrative agencies were not to be sustained unless based on substantial evidence supported by the record. Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456. Yet how can this Court tell whether there was substantial evidence when it cannot tell how the Commission arrived at its figures? 'We must know what a decision means before the duty becomes ours to say whether it is right or wrong.' United States v. Chicago, M., St. P. & P.R. Co., 294 U.S. 499, 511, 55 S.Ct. 462, 467, 79 L.Ed. 1023. Explicit reasons for its result would seem all the more called for where the Commission under its earlier decisions had compelled those protesting a proposed initial rate like that in this case to bear the burden of proving the rate's invalidity. See, e.g., Cotton from New Orleans, 49 I.C.C. 751; Bay State Milling Co. v. Great Lakes Transit Corp., 43 I.C.C. 338. The opinion of the Commission here means simply that the Commission strikes down the tariff, and reviewing courts will please trust that it had good reasons for doing so.
9
Furthermore, in Interstate Commerce Comm'n v. Mechling, 330 U.S. 567, 581—583, 67 S.Ct. 894, 901—902, 91 L.Ed. 1102, we held that use by the Commission of general formulas and unsifted averages could not take the place of findings. Yet the Commission here admits to basing much of its result on averages taken from the 1959 annual report of the C&EI on all its operations, leaving unanswered and unrebutted the protests of the C&EI that many costs which it incurs on other routes are not applicable to the Mount Vernon-Chicago run. In addition, the Commission increased costs taken from the annual report by 2.9% on the theory that operating expenses of the C&EI had increased by that amount during the year between the time of the report and the time of the hearing. This figure was stated to be the increase in costs of all railroads in the United States for the period. The C&EI protested that comparison of its 1957 and 1959 annual reports showed that many of its costs had been, contrary to any national average, decreasing slightly, and argued that there was no basis for the apparent conclusion that its costs had not continued to decrease, however much those of other railroads might have increased. But so fond was the Commission of its 2.9% 'trending factor' that it seems to have included it as a part of the cost of the barge segment of the joint rate as well, without explaini g how a supposed national increase in cost of labor and equipment for railroads is necessarily accompanied by one for barge lines also. I am unable to grasp the logic which apparently determined that increases in costs of steel rails and maintenance of rolling stock made the Ohio River Company's barges more expensive to operate.
10
It appears that the Commission has ignored commands of Congress and of this Court. The large railroads have succeeded in this case in doing a great injury to a barge line and to a small railroad which dared willingly to cooperate with another mode of transport, as the law required it to do, in order to profit from the inherent advantages of each and thereby benefit the public. The Commission asks us to believe that the C&EI schemed to carry on an operation on which it would lose money, losing greater and greater sums the more coal it hauled, presumably in the hope of living on its capital until it had driven out of business such companies as the New York Central and the Pennsylvania. I find this a difficult proposition to accept, and should like to have the Commission explain in plain understandable English how it reached such a conclusion. Unfortunately, the report as it stands makes it impossible for me to say whether the ultimate findings are supported by substantial evidence or not. Yet instead of requiring the Commission to comply with the law at least sufficiently that its acts may be reviewed, my Brethren silently affirm a lower court judgment which I think is completely out of line with the mandate of Congress and our past emphatic holdings. The Commission apparently seeks to make a rubber stamp of any court reviewing its orders. I do not like that role. If summary disposition is in order, I should think reversal the appropriate judgment.
1
'* * * (W)e would be remiss in our duty if we did not take note of the fact that for over eight years plaintiffs have been seeking relief in this proceeding from discriminatory rail rates which we find are in violation of the Interstate Commerce Act. Section 10(e) of the Administrative Procedure Act provides that the reviewing court 'shall * * * compel agency action unlawfully withheld or unreasonably delayed.' It is the opinion of this court that the present case is an appropriate one for application of this statutory provision, and that the plaintiffs are entitled to prompt relief from the discriminatory rates presently in effect. The case is therefore remanded with instructions to the Commission to enter an order prescribing lawful, reasonable, and nondiscriminatory rates * * *.' 176 F.Supp. at 421.
2
'The formula used here which lumps all through rail grain rates, irrespective of the services rendered, to give rail-carried grain a preferred rate over barge-carried grain, is indistinguishable in cause and consequence from an order which directly raises barge rates to relieve the railroads from barge competition. In any event, there has been no showing by the Commission as to how much, if any, of the 3-cent reshipping rate increase is attributable to the fact that ex-barge grain requires more terminal service on the average than does ex-rail grain.' Interstate Commerce Comm'n v. Mechling, 330 U.S. 567, at 582, 67 S.Ct. 894, at 901.
3
The unfolding of such an episode can be seen in the Arrow litigation, in which railroads proposed suddenly to cut their rates for all-rail grain shipments to the Southeast by more than half. Although the District Court subsequently found that the rates if approved probably would put the competing barge lines out of business in a short time, the Commission still had taken no action after seven months and so under the statute the rates went into effect. For a history of the Arrow litigation, see Arrow Transportation Co. v. Southern R. Co., Civil No. 10,224 (D.C.N.D.Ala.), Aug. 3, 1962 (denying, for lack of jurisdiction, injunction of unlawful railroad rates); Arrow Transportation Co. v. Southern R. Co., 83 S.Ct. 1, 9 L.Ed.2d 36 (in chambers) (extending order of circuit judges temporarily restraining rates); Arrow Transportation Co. v Southern R. Co., 308 F.2d 181 (C.A.5th Cir.) (affirming District Court); Arrow Transportation Co. v. Southern R. Co., 83 S.Ct. 3 (in chambers) (restraining rates pending disposition of case by Supreme Court); Grain in Multiple-Car Shipments—River Crossings to the South, I.C.C. Division 2, 318 I.C.C. 641 (upholding unlawful rates in part); Arrow Transportation Co. v. Southern R. Co., 372 U.S. 658, 83 S.Ct. 984, 10 L.Ed.2d 52 (affirming Court of Appeals, thereby permitting rates to take effect). In short, Division 2 of the Commission waited 17 months before taking any action on the protest of the barge lines, thereby permitting rates to take effect which the District Court had said would destroy the barge lines. And it was nearly six months more before the full Commission on reconsideration held the rates unlawful. Grain in Multiple-Car Shipments—River Crossings to the South, I. & S. Docket No. 7656, July 1, 1963, 321 I.C.C. 582. The same rates remain in effect today, for the railroads have obtained an order restraining the Commission's lastest order. Cincinnati, N.O. & T.P.R. Co. v. United States, 220 F.Supp. 46 (D.C.S.D.Ohio).
4
See Douglas, The Supreme Court and Its Case Load, 45 Cornell L.Q. 401.
| 89
|
375 U.S. 106
84 S.Ct. 242
11 L.Ed.2d 186
Gene DURFEE et ux., Petitioners,v.Julia E. DUKE.
No. 37.
Argued Oct. 24, 1963.
Decided Dec. 2, 1963.
August Ross, Omaha, Neb., for petitioners.
Robert A. Brown, for respondent.
Mr. Justice STEWART delivered the opinion of the Court.
1
The United States Constitution requires that 'Full Faith and Credit shall be given in each State to the * * * judicial Proceedings of every other State.'1 The case before us presents questions arising under this constitutional provision and under the federal statute enacted to implement it.2
2
In 1956 the petitioners brought an action against the respondent in a Nebraska court to quiet title to certain bottom land situated on the Missouri River. The main channel of that river forms the boundary between the States of Nebraska and Missouri. The Nebraska court had jurisdiction over the subject matter of the controversy only if the land in question was in Nebraska. Whether the land was Nebraska land depended entirely upon a factual question—whether a shift in the river's course had been caused by avulsion or accretion.3 The respondent appeared in the Nebraska court and through counsel fully litigated the issues, explicitly contesting the court's jurisdiction over the subject matter of the controversy.4 After a hearing the court found the issues in favor of the petitioners and ordered that title to the land be quieted in them. The respondent appealed, and the Supreme Court of Nebraska affirmed the judgment after a trial de novo on the record made in the lower court. The State Supreme Court specifically found that the rule of avulsion was applicable, that the land in question was in Nebraska, that the Nebraska courts therefore had jurisdiction of the subject matter of the litigation, and that title to the land was in the petitioners. Durfee v. Keiffer, 168 Neb. 272, 95 N.W.2d 618. The respondent did not petition this Court for a writ of certiorari to review that judgment.
3
Two months later the respondent filed a suit against the petitioners in a Missouri court to quiet title to the same land. Her complaint alleged that the land was in Missouri. The suit was removed to a Federal District Court by reason of diversity of citizenship. The District Court after hearing evidence expressed the view that the land was in Missouri, but held that all the issues had been adjudicated and determined in the Nebraska litigation, and that the judgment of the Nebraska Supreme Court was res judicata and 'is now binding upon this court.' The Court of Appeals reversed, holding that the District Court was not required to give full faith and credit to the Nebraska judgment, and that normal res judicata principles were not applicable because the controversy involved land and a court in Missouri was therefore free to retry the question of the Nebraska court's jurisdiction over the subject matter. 308 F.2d 209. We granted certiorari to consider a question important to the administration of justice in our federal system. 371 U.S. 946, 83 S.Ct. 509, 9 L.Ed.2d 496. For the reasons that follow, we reverse the judgment before us.
4
The constitutional command of full faith and credit, as implemented by Congress, requires that 'judicial proceedings * * * shall have the same full faith and credit in every court within the United States * * * as they have by law or usage in the courts of such State * * * from which they are taken.'5 Full faith and credit thus generally requires every State to give to a judgment at least the res judicata effect which the judgment would be accorded in the State which rendered it. 'By the Constitutional provision for full faith and credit, the local doctrines of res judicata, speaking generally, become a part of national jurisprudence, and therefore federal questions cognizable here.' Riley v. New York Trust Co., 315 U.S. 343, 349, 62 S.Ct. 608, 612, 86 L.Ed. 885.
5
It is not questioned that the Nebraska courts would give full res judicata effect to the Nebraska judgment quieting title in the petitioners.6 It is the respondent's position, however, that whatever effect the Nebraska courts might give to the Nebraska judgment, the federal court in Missouri was free independently to determine whether the Nebraska court in fact had jurisdiction over the subject matter, i.e., whether the land in question was actually in Nebraska.
6
In support of this position the respondent relies upon the many decisions of this Court which have held that a judgment of a court in one State is conclusive upon the merits in a court in another State only if the court in the first State had power to pass on the merits—had jurisdiction, that is, to render the judgment. As Mr. Justice Bradley stated the doctrine in the leading case of Thompson v. Whitman, 18 Wall. 457, 21 L.Ed. 897, 'we think it clear that the jurisdiction of the court by which a judgment is rendered in any State may be questioned in a collateral proceeding in another State, notwithstanding the provision of the fourth article of the Constitution and the law of 1790, and notwithstanding the averments contained in the record of the judgment itself.' 18 Wall., at 469, 21 L.Ed. 897. The principle has been restated and applied in a variety of contexts.7
7
However, while it is established that a court in one State, when asked to give effect to the judgment of a court in another State, may constitutionally inquire into the foreign court's jurisdiction to render that judgment, the mordern decisions of this Court have carefully delineated the permissible scope of such an inquiry. From these decisions there emerges the general rule that a judgment is entitled to full faith and credit—even as to questions of jurisdiction—when the second court's inquiry discloses that those questions have been fully and fairly litigated and finally decided in the court which rendered the original judgment.
8
With respect to questions of jurisdiction over the person,8 this principle was unambiguously established in Baldwin v. Iowa State Traveling Men's Ass'n, 283 U.S. 522, 51 S.Ct. 517, 75 L.Ed. 1244. There it was held that a federal court in Iowa must give binding effect to the judgment of a federal court in Missouri despite the claim that the original court did not have jurisdiction over the defendant's person, once it was shown to the court in Iowa that that question had been fully litigated in the Missouri forum. 'Public policy,' said the Court, 'dictates that there be an end of litigation; that those who have contested an issue shall be bound by the result of the contest; and that matters once tried shall be considered forever settled as between the parties. We see no reason why this doctrine should not apply in every case where one voluntarily appears, presents his case and is fully heard, and why he should not, in the absence of fraud, be thereafter concluded by the judgment of the tribunal to which he has submitted his cause.' 283 U.S., at 525 526, 1 S.Ct., at 518, 75 L.Ed. 1244.9
9
Following the Baldwin case, this Court soon made clear in a series of decisions that the general rule is no different when the claim is made that the original forum did not have jurisdiction over the subject matter. Davis v. Davis, 305 U.S. 32, 59 S.Ct. 3, 83 L.Ed. 26; Stoll v. Gottlieb, 305 U.S. 165, 59 S.Ct. 134, 83 L.Ed. 104;10 Treinies v. Sunshine Mining Co., 308 U.S. 66, 60 S.Ct. 44, 84 L.Ed. 85; Sherrer v. Sherrer, 334 U.S. 343, 68 S.Ct. 1087, 92 L.Ed. 1429.11 In each of these cases the claim was made that a court, when asked to enforce the judgment of another forum, was free to retry the question of that forum's jurisdiction over the subject matter. In each case this Court held that since the question of subject-matter jurisdiction had been fully litigated in the original forum, the issue could not be retried in a subsequent action between the parties.
10
In the Davis case it was held that the courts of the District of Columbia were required to give full faith and credit to a decree of absolute divorce rendered in Virginia, despite the claim that the Virginia court had lacked jurisdiction because the plaintiff in the Virginia proceedings had not been domiciled in that State. In the course of the opinion the Court stated:
11
'As to petitioner's domicil for divorce and his standing to invoke jurisdiction of the Virginia court, its finding that he was a bona fide resident of that State for the required time is binding upon respondent in the courts of the District. She may not say that he was not entitled to sue for divorce in the state court, for she appeared there and by plea put in issue his allegation as to domicil, introduced evidence to show it false, took exceptions to the commissioner's report, and sought to have the court sustain them and uphold her plea. Plainly, the determination of the decree upon that point is effective for all purposes in this litigation.' 305 U.S., at 40, 59 S.Ct., at 6, 83 L.Ed. 26.
12
This doctrine of jurisdictional finality was applied even more unequivocally in Treinies, supra, involving title to personal property, and in Sherrer, supra, involving, like Davis, recognition of a foreign divorce decree. In Treinies, the rule was succinctly stated: 'One trial of an issue is enough. 'The principles of res judicata apply to questions of jurisdiction as well as to other issues,' as well to jurisdiction of the subject matter as of the parties.' 308 U.S., at 78, 60 S.Ct., at 51, 84 L.Ed. 85.
13
The reasons for such a rule are apparent. In the words of the Court's opinion in Stoll v. Gottlieb, supra, 'We see no reason why a court in the absence of an allegation of fraud in obtaining the judgment, should examine again the question whether the court making the earlier determination on an actual contest over jurisdiction between the parties, did have jurisdiction of the subject matter of the litigation. * * * Courts to determine the rights of parties are an integral part of our system of government. It is just as impo tant that there should be a place to end as that there should be a place to begin litigation. After a party has his day in court, with opportunity to present his evidence and his view of the law, a collateral attack upon the decision as to jurisdiction there rendered merely retries the issue previously determined. There is no reason to expect that the second decision will be more satisfactory than the first.' 305 U.S., at 172, 59 S.Ct., at 138, 83 L.Ed. 104.
14
To be sure, the general rule of finality of jurisdictional determinations is not without exceptions. Doctrines of federal pre-emption or sovereign immunity may in some contexts be controlling. Kalb v. Feuerstein, 308 U.S. 433, 60 S.Ct. 343, 84 L.Ed. 370; United States v. United States Fidelity & Guaranty Co., 309 U.S. 506, 60 S.Ct. 653, 84 L.Ed. 894.12 But no such overriding considerations are present here. While this Court has not before had occasion to consider the applicability of the rule of Davis, Stoll, Treinies, and Sherrer to a case involving real property, we can discern no reason why the rule should not be fully applicable.13
15
It is argued that an exception to this rule of jurisdictional finality should be made with respect to cases involving real property because of this Court's emphatic expressions of the doctrine that courts of one State are completely without jurisdiction directly to affect title to land in other States.14 This argument is wide of the mark. Courts of one State are equally without jurisdiction to dissolve the marriages of those domiciled in other States. But the location of land, like the domicile of a party to a divorce action, is a matter 'to be resolved by judicial determination.' Sherrer v. Sherrer, 334 U.S., at 349, 68 S.Ct., at 1090, 92 L.Ed. 1429. The question remains whether, once the matter has been fully litigated and judicially determined, it can be retried in another State in litigation between the same parties. Upon the reason and authority of the cases we have discussed, it is clear that the answer must be in the negative.
16
It is to be emphasized that all that was ultimately determined in the Nebraska litigation was title to the land in question as between the parties to the litigation there. Nothin there decided, and nothing that could be decided in litigation between the same parties or their privies in Missouri, could bind either Missouri or Nebraska with respect to any controversy they might have, now or in the future, as to the location of the boundary between them, or as to their respective sovereignty over the land in question. Fowler v. Lindsey, 3 Dall. 411, 1 L.Ed. 657; New York v. Connecticut, 4 Dall. 1, 1 L.Ed. 715; Land v. Dollar, 330 U.S. 731, 736—737, 67 S.Ct. 1009, 1011—1012, 91 L.Ed. 1209. Either State may at any time protect its interest by initiating independent judicial proceedings here. Cf. Missouri v. Nebraska, 196 U.S. 23, 25 S.Ct. 155, 49 L.Ed. 372.15
17
For the reasons stated, we hold in this case that the federal court in Missouri had the power and, upon proper averments, the duty to inquire into the jurisdiction of the Nebraska courts to render the decree quieting title to the land in the petitioners. We further hold that when that inquiry disclosed, as it did, that the jurisdictional issues had been fully and fairly litigated by the parties and finally determined in the Nebraska courts, the federal court in Missouri was correct in ruling that further inquiry was precluded. Accordingly the judgment of the Court of Appeals is reversed, and that of the District Court is affirmed. It is so ordered.
18
Judgment of Court of Appeals reversed and judgment of District Court affirmed.
19
Mr. Justice BLACK, concurring.
20
Petitioners and respondents dispute the ownership of a tract of land adjacent to the Missouri River, which is the boundary between Nebraska and Missouri. Resolution of this question turns on Whether the land is in Nebraska or Missouri. Neither State, of course, has power to make a determination binding on the other as to which State the land is in. U.S.Const. Art. III, § 2; 28 U.S.C. § 1251(a). However, in a private action brought by these Nebraska petitioners, the Nebraska Supreme Court has held that the disputed tract is in Nebraska. In the present suit, brought by this Missouri respondent in Missouri, the United States Court of Appeals has refused to be bound by the Nebraska court's judgment. I concur in today's reversal of the Court of Appeals' judgment, but with the understanding that we are not deciding the question whether the respondent would continue to be bound by the Nebraska judgment should it later be authoritatively decided, either in an original proceeding between the States in this Court or by a compact between the two States under Art. I, § 10, that the disputed tract is in Missouri.
1
'Full Faith and Credit shall be given in each State to the public Acts, Records, and judicial Proceedings of every other State. And the Congress may by general Laws prescribe the Manner in which such Acts, Records and Proceedings shall be proved, and the Effect thereof.' U.S.Const. Art. IV, § 1.
2
'The Acts of the legislature of any State, Territory, or Possession of the United States, or copies thereof, shall be authenticated by affixing the seal of such State, Territory or Possession thereto.
'The records and judicial proceedings of any court of any such State, Territory or Possession, or copies thereof, shall be proved or admitted in other courts within the United States and its Territories and Possessions by the attestation of the clerk and seal of the court annexed, if a seal exists, together with a certificate of a judge of the court that the said attestation is in proper form.
'Such Acts, records and judicial proceedings or copies thereof, so authenticated, shall have the same full faith and credit in every court within the United States and its Territories and Possessions as they have by law or usage in the courts of such State, Territory or Possession from which they are taken.' Act of June 25, 1948, c. 646, 62 Stat. 947, 28 U.S.C. § 1738.
The progenitor of the present statute was enacted by the First Congress in 1790. 1 Stat. 122.
'The Act extended the rule of the Constitution to all courts, Federal as well as State. Mills v. Duryee, 7 Cranch 481, 485.' Davis v. Davis, 305 U.S. 32, 40, 59 S.Ct. 3, 6, 83 L.Ed. 26.
3
Throughout this litigation there has been no dispute as to the controlling effect of this factual issue. See Nebraska v. Iowa, 143 U.S. 359, 370, 12 S.Ct. 396, 400, 36 L.Ed. 186.
4
This is, therefore, not a case in which a party, although afforded an opportunity to contest subject-matter jurisdiction, did not litigate the issue. Cf. Chicot County Drainage Dist. v. Baxter State Bank, 308 U.S. 371, 60 S.Ct. 317, 84 L.Ed. 329.
5
See note 2, supra.
6
The Nebraska Supreme Court has clearly postulated the relevant law of the State: 'This court adheres to the rule that if a court is one competent to decide whether or not the facts in any given proceeding confer jurisdiction, decides that it has jurisdiction, then its judgments entered within the scope of the subject matter over which its authority extends in proceedings following the lawful allegation of circumstances requiring the exercise of its jurisdiction, are not subject to collate al attack but conclusive against all the world unless reversed on appeal or avoided for error or fraud in a direct proceeding. Brandeen v. Lau, 113 Neb. 34, 201 N.W. 665; Douglas County v. Feenan, 146 Neb. 156, 18 N.W.2d 740, 159 A.L.R. 569.' Gergen v. Western Union Life Ins. Co., 149 Neb. 203, 210, 30 N.W.2d 558, 562.
7
See, e.g., D'Arcy v. Ketchum, 11 How. 165, 13 L.Ed. 648; Knowles v. Gaslight & Coke Co., 19 Wall. 58, 22 L.Ed. 70; Hall v. Lanning, 91 U.S. 160, 23 L.Ed. 271; Cole v. Cunningham, 133 U.S. 107, 10 S.Ct. 269, 33 L.Ed. 538; Grover & Baker Sewing Machine Co. v. Radcliffe, 137 U.S. 287, 11 S.Ct. 92, 34 L.Ed. 670; Thormann v. Frame, 176 U.S. 350, 20 S.Ct. 446, 44 L.Ed. 500; Bell v. Bell, 181 U.S. 175, 21 S.Ct. 551, 45 L.Ed. 804; Andrews v. Andrews, 188 U.S. 14, 23 S.Ct. 237, 47 L.Ed. 366; National Exchange Bank of Tiffin v. Wiley, 195 U.S. 257, 25 S.Ct. 70, 49 L.Ed. 184; Old Wayne Mutual Life Assn. of Indianapolis, Ind. v. McDonough, 204 U.S. 8, 27 S.Ct. 236, 51 L.Ed. 345; Chicago Life Ins. Co. v. Cherry, 244 U.S. 25, 37 S.Ct. 492, 61 L.Ed. 966; Vallely v. Northern Fire & Marine Ins. Co., 254 U.S. 348, 41 S.Ct. 116, 65 L.Ed. 297; Grubb v. Public Utilities Comm'n, 281 U.S. 470, 50 S.Ct. 374, 74 L.Ed. 972.
8
It is not disputed in the present case that the Nebraska courts had jurisdiction over the respondent's person. She entered a general appea ance in the trial court, and initiated the appeal to the Nebraska Supreme Court.
9
This decision was adhered to the following year in American Surety Co. v. Baldwin, 287 U.S. 156, 53 S.Ct. 98, 77 L.Ed. 231. In his opinion for a unanimous Court in the case, Mr. Justice Brandeis said: 'The principles of res judicata apply to questions of jurisdiction as well as to other issues.' 287 U.S., at 166, 53 S.Ct., at 101, 77 L.Ed. 231.
10
The question is Stoll was what effect the courts of Illinois must give to the judgment of a federal court sitting in that State. The case, therefore, did not directly involve the Full Faith and Credit Clause of the Constitution, but, like the present case, it involved the federal statute enacted to implement the constitutional provision. 305 U.S., at 170, n. 5, 59 S.Ct., at 136 137, 83 L.Ed. 104. See note 2, supra.
11
See also Sunshine Anthracite Coal Co. v. Adkins, 310 U.S. 381, 403, 60 S.Ct. 907, 917, 94 L.Ed. 1263; Jackson v. Irving Trust Co., 311 U.S. 494, 61 S.Ct. 326, 85 L.Ed. 297.
12
It is to be noted, however, that in neither of these cases had the jurisdictional issues actually been litigated in the first forum.
THE RESTATEMENT OF CONFLICT OF LAWS recognizes the possibility of such exceptions:
'Where a court has jurisdiction over the parties and determines that it has jurisdiction over the subject matter, the parties cannot collaterally attack the judgment on the ground that the court did not have jurisdiction over the subject matter, unless the policy underlying the doctrine of res judicata is outweighed by the policy against permitting the court to act beyond its jurisdiction. Among the factors appropriate to be considered in determining that collateral attack should be permitted are that
'(a) the lack of jurisdiction over the subject matter was clear;
'(b) the determination as to jurisdiction depended upon a question of law rather than of fact;
'(c) the court was one of limited and not of general jurisdiction;
'(d) the question of jurisdiction was not actually litigated;
'(e) the policy against the court's acting beyond its jurisdiction is strong.' RESTATEMENT, CONFLICT OF LAWS, § 451(2) (Supp.1948). See RESTATEMENT, JUDGMENTS, § 10 (1942).
13
In two previous cases the Court has expressly left open the question of the applicability of the rule of jurisdictional finality to cases involving real property. See Stoll v. Gottlieb, 305 U.S., at 176, 59 S.Ct., at 139—140, 83 L.Ed. 104; United States v. United States Fidelity & Guaranty Co., 309 U.S., at 514, 60 S.Ct., at 657, 84 L.Ed. 894.
14
See Fall v. Eastin, 215 U.S. 1, 30 S.Ct. 3, 54 L.Ed. 65; Carpenter v. Strange, 141 U.S. 87, 105—106, 11 S.Ct. 960, 966, 35 L.Ed. 640; Olmsted v. Olmsted, 216 U.S. 386, 30 S.Ct. 292, 54 L.Ed. 530.
15
The alternative of a negotiated settlement of any dispute between the States over the location of the boundary would also always be available. See U.S.Const. Art. I, § 10.
| 1011
|
375 U.S. 118
84 S.Ct. 248
11 L.Ed.2d 195
UNITED STATES, Petitioner,v.Dorothy Anne STAPF and B. T. Ware, II, Executors and Trustees of the Estate of Lowell H. Stapf, deceased, and Dorothy Ann Stapf, Individually.
No. 54.
Argued Oct. 23 and 24, 1963.
Decided Dec. 2, 1963.
Rehearing Denied Jan. 6, 1964.
See 375 U.S. 981, 84 S.Ct. 477.
Wayne G. Barrett, for petitioner.
Mr. W. M. Sutton, Amarillo, Tex., for respondents.
Mr. Justice GOLDBERG delivered the opinion of the Court.
1
Respondents brought this suit against the Government in the District Court for the Northern District of Texas for a refund of estate taxes paid pursuant to an asserted deficiency. The Court of Appeals for the Fifth Circuit held that respondents were entitled to certain marital deductions under § 812(e) of the Internal Revenue Code of 19391 and also to deductions for other payments as 'claims against the estate' and 'administration expenses' under § 812(b)(3) and (2) of the 1969 Code.2 5 Cir., 309 F.2d 592. We granted certiorari to consider questions of statutory interpretation important to the administration of the federal estate tax laws. 372 U.S. 928, 83 S.Ct. 873, 9 L.Ed.2d 7 2.
2
Lowell H. Stapf died testate on July 29, 1953, a resident and domiciliary of Texas, a community property jurisdiction. At the time of his death he owned, in addition to his separate estate, a substantial amount of property in community with his wife. His will required that his widow elect either to retain her one-half interest in the community or to take under the will and allow its terms to govern the disposition of her community interest. If Mrs. Stapf were to elect to take under the will, she would be given, after specific bequests to others, one-third of the community property and one-third of her husband's separate estate. By accepting this bequest she would allow her one-half interest in the community to pass, in accordance with the will, into a trust for the benefit of the children. It was further provided that if she chose to take under the will the executors were to pay 'all and not merely one-half' of the community debts and administration expenses.
3
The relevant facts and computations are not in dispute. The decedent's separate property was valued at $65,100 and the community property at $258,105.3 The only debts were community debts totalling $32,368. The administration expenses, including attorneys' fees, were $4,073. If Mrs. Stapf had not elected to take under the will, she would have retained her fully vested one-half interest in the community property ($129,052) which would have been charged with one-half of the community debts ($16,184) and 35% of the administration expenses ($1,426).4 Thus, as the parties agree, she would have received a net of $111,443.
4
In fact Mrs. Stapf elected to take under the will. She received, after specific bequests to others, one-third of the combined separate and community property, a devise valued at $106,268,5 which was $5,175 less than she would have received had she retained her community property and refused to take under the will.6
5
In computing the net taxable estate, the executors claimed a marital deduction under § 812(e)(1) of the Internal Revenue Code of 1939 for the full value of the one-third of decedent's separate estate ($22,367) which passed to his wife under the will. The executors also claimed a deduction for the entire $32,368 of community debts as 'claims against the estate' under § 812(b)(3) and for the entire $4,073 of expenses as 'administration expenses' under § 812(b)(2). The Commissioner of Internal Revenue disallowed the marital deduction and the deductions for claims and administration insofar as these represented debts (50%) and expenses (35%) chargeable to the wife's one-half of the community. Respondents then instituted this suit for a tax refund. The District Court allowed the full marital deduction but disallowed the disputed claims and expenses. 189 F.Supp. 830. On cross-appeals the Court of Appeals, with one judge dissenting on all issues, held that each of the claimed deductions was allowable in full. 309 F.2d 592. For reasons stated below, we hold that the Commissioner was correct and that none of the disputed deductions is allowable.7
I. THE MARITAL DEDUCTION
6
By electing to take under the will, Mrs. Stapf, in effect, agreed to accept the property devised to her and, in turn, to surrender property of greater value to the trust for the benefit of the children. This raises the question of whether a decedent's estate is allowed a marital deduction under § 812(e)(1) (E)(ii) of the 1939 Code where the bequest to the surviving spouse is on the condition that she convey property of equivalent or greater value to her children. The Government contends that, for purposes of a marital deduction, 'the value of the interest passing to the wife is the value of the property given her less the value of the property she is required to give another as a condition to receiving it.' On this view, since the widow had no net benefit from the exercise of her election, the estate would be entitled to no marital deduction. Respondents reject this net benefit approach a d argue that the plain meaning of the statute makes detriment to the surviving spouse immaterial.
7
Section 812(e)(1)(A) provides that 'in general' the marital deduction is for 'the value of any interest in property which passes * * * from the decedent to his surviving spouse.' Subparagraph (E) then deals specifically with the question of valuation:
8
'(E) Valuation Of interest passing To surviving spouse. In determining for the purposes of subparagraph (A) the value of any interest in property passing to the surviving spouse for which a deduction is allowed by this subsection— '(ii) where such interest or property is incumbered in any manner, or where the surviving spouse incurs any obligation imposed by the decedent with respect to the passing of such interest, such incumbrance or obligation shall be taken into account in the same manner as if the amount of a gift to such spouse of such interest were being determined.'
9
The disputed deduction turns upon the interpretation of (1) the introductory phrase 'any obligation imposed by the decedent with respect to the passing of such interest,' and (2) the concluding provision that 'such * * * obligation shall be taken into account in the same manner as if the amount of a gift to such spouse of such interest were being determined.'
10
The Court of Appeals, in allowing the claimed marital deduction, reasoned that since the valuation is to be 'as if' a gift were being taxed, the legal analysis should be the same as if a husband had made an inter vivos gift to his wife on the condition that she give something to the children. In such a case, it was stated, the husband is taxable in the full amount for his gift. The detriment incurred by the wife would not ordinarily reduce the amount of the gift taxable to the husband, the original donor.8 The court concluded:
11
'Within gift tax confines the community property of the widow passing under the will of the husband to others may not be 'netted' against the devise to the widow, and thus testator, were the transfer inter vivos, would be liable for gift taxes on the full value of the devise.' 309 F.2d 592, 598.
12
This conclusion, based on the alleged plain meaning of the final gift-amount clause of § 812(e)(1)(E)(ii),9 is not supported by a reading of the entire statutory provision. First, § 812(e) allows a marital deduction only for the decedent's gifts or bequests which pass 'to his surviving spouse.' In the present case the effect of the devise was not to distribute wealth to the surviving spouse, but instead to transmit, through the widow, a gift to the couple's children. The gift-to-the-surviving-spouse terminology reflects concern with the status of the actual recipient or donee of the gift. What the statute provides is a 'marital deduction'—a deduction for gifts to the surviving spouse not a deduction for gifts to the children or a deduction for gifts to privately selected beneficiaries. The appropriate reference, therefore, is not to the value of the gift moving from the deceased spouse but to the net value of the gift received by the surviving spouse.
13
Second, the introductory phrases of § 812(e)(1)(E)(ii) provide that the gift-amount determination is to be made 'where such interest or property is incumbered in any manner, or where the surviving spouse incurs any obligation imposed by th decedent with respect to the passing of such interest * * *.' The Government, drawing upon the broad import of this language, argues: 'An undertaking by the wife to convey property to a third person, upon which her receipt of property under the decedent's will is conditioned, is plainly an 'obligation imposed by the decedent with respect to the passing of such interest." Respondents contend that 'incumbrance or obligation' refers only to 'a payment to be made out of property passing to the surviving spouse.' Respondents' narrow construction certainly is not compelled by a literal interpretation of the statutory language. Their construction would embrace only, for example, an obligation on the property passing whereas the statute speaks of an obligation 'with respect to the passing' gift. Finally, to arrive at the real value of the gift 'such * * * obligation shall be taken into account * * *.' In context we think this relates the gift-amount determination to the net economic interest received by the surviving spouse.
14
This interpretation is supported by authoritative declarations of congressional intent. The Senate Committee on Finance, in explaining the operation of the marital deduction, stated its understanding as follows:
15
'If the decedent bequeaths certain property to his surviving spouse subject, however, to her agreement, or a charge on the property, for payment of $1,000 to X, the value of the bequest (and, accordingly, the value of the interest passing to the surviving spouse) is the value, reduced by $1,000, of such property.' S.Rep. No. 1013, 80th Cong., 2d Sess., Pt. 2, p. 6; U.S.Code Cong.Service 1948, p. 1228. (Emphasis added.)
16
The relevant Treasury Regulation is directly based upon, if not literally taken from, such expressions of legislative intent. Treas.Reg. 105, § 81.47c(b) (1949). The Regulation specifically includes an example of the kind of testamentary disposition involved in this case:
17
'A decedent bequeathed certain securities to his wife in lieu of her interest in property held by them as community property under the law of the State of their residence. The wife elected to relinquish her community property interest and to take the bequest. For the purpose of the marital deduction, the value of the bequest is to be reduced by the value of the community property interest relinquished by the wife.'10
18
We conclude, therefore, that the ogerning principle, approved by Congress and embodied in the Treasury Regulation,11 must be that a marital deduction is allowable only to the extent that the property bequeathed to the surviving spouse exceeds in value the property such spouse is required to relinquish.
19
Our conclusion concerning the congressionally intended result under § 812(e) (1) accords with the general purpose of Congress in creating the marital deduction. The 1948 tax amendments were intended to equalize the effect of the estate taxes in community property and common-law jurisdictions.12 Under a community property system, such as that in Texas, the spouse receives outright ownership of one-half of the community property and only the other one-half is included in the decedent's estate. To equalize the incidence of progressively scaled estate taxes and to adhere to the patterns of state law, the marital deduction permits a deceased spouse, subject to certain requirements, to transfer free of taxes one-half of the non-community property to the surviving spouse. Although applicable to separately held property in a community property state, the primary thrust of this is to extend to taxpayers in common-law States the advantages of 'estate splitting' otherwise available only in community property States. The purpose, however, is only to permit a married couple's property to be taxed in two stages and not to allow a tax-exempt transfer of wealth into succeeding generations. Thus the marital deduction is generally restricted to the transfer of property interests that will be includible in the surviving spouse's gross estate.13 Respondents' construction of § 812(e)(1) would, nevertheless, permit one-half of a spouse's wealth to pass from one generation to another without being subject either to gift or estate taxes.14 We do not believe that this result, squarely contrary to the concept of the marital deduction, can be justified by the language of § 812(e)(1). Furthermore, since in a community property jurisdiction one-half of the community normally vests in the wife, approval of the claimed deduction would create an opportunity for tax reduction that, as a practical matter, would be more readily available to couples in community property jurisdictions than to couples in common-law jurisdictions.15 Such a result, again, would be unnecessarily inconsistent with a basic purpose of the statute.
20
Since in our opinion the plain meaning of § 812(e)(1) does not require the interpretation advanced by respondents, the statute must be construed to accord with the clearly expressed congressional purposes and the relevant Treasury Regulation. We conclude that, for estate tax purposes, the value of a conditional bequest to a widow should be the value of the property give to her less the value of the property she is required to give to another. In this case the value of the property transferred to Mrs. Stapf ($106,268) must be reduced by the value of the community property she was required to relinquish ($111,443). Since she received no net benefit, the estate is entitled to no marital deduction.
21
II. CLAIMS AGAINST THE ESTATE AND ADMINISTRATION EXPENSES
22
A. Claims Against the Estate.
23
Section 812(b)(3) of the 1939 Code provides for the deduction from the gross estate of 'Such amounts * * * for claims against the estate * * * as are allowed by the laws of the jurisdiction * * * under which the estate is being administered * * *.' The community debts in this case total $32,368, consisting largely of taxes due for past income. The decedent's will directed that his executors pay 'all and not merely one-half' of the community debts. Under Texas law, absent this provision, only one-half of the community debts would be charged to the decedent's half of the community. The issue presented is whether, as a result of the testamentary direction, a deduction may be taken for the entire amount of the community debts as 'claims against the estate * * * allowed by' state law.
24
The first question to consider is whether the claim is of the type intended to be deductible.16 It cannot be denied that where the executors are directed to pay the debts of another party the substance of the direction is to confer a beneficial gift on that party. Respondents' contentions in effect require that § 812(b) designed to allow deductions for 'expenses, losses, indebtedness, and taxes' be construed to authorize tax free gifts despite the general policy that wealth not be transmitted tax free at death.17 The provisions of § 812(b) demonstrate that it was not intended to allow deductions for voluntary transfers that deplete the estate merely because the testator described the transfers or payments as the settlement of 'claims' or 'debts.' This intent is evidenced by the treatment of claims or debts founded upon promises or agreements. The section carefully restricts the deductible amount 'in the case of claims against the estate * * * or any indebtedness * * *, when founded upon a promise or agreement, * * * to the extent that they were contracted bona fide and for a adequate and full consideration in money or money's worth. * * *' Absent such an offset or augmentation of the estate, a testator could disguise transfers as payments in settlement of debts and claims and thus obtain deductions for transmitting gifts. As this requirement suggests, a deduction under § 812(b) should not be predicated solely on the finding that a promise or claim is legally enforceable under the state laws governing the validity of contracts and wills.18 The claims referred to by the statute are those 'claims against' the property of the deceased which are allowed by and enforceable under the laws of the administering State and not those claims created by the deceased's gratuitous assumption of debts attaching to the property of another.
25
The pertinent Treasury Regulation states that the deductible claims are 'such only as represent personal obligations of the decedent * * *.'19 We cannot agree with respondents' contention that the debts chargeable to the wife's community property are 'personal obligations' of the decedent within the meaning of the Regulation. It is true, as the Court of Appeals stated, that under Texas law the husband, as manager of the community property, was personally liable for the full amount of community debts. 309 F.2d 592, 596. His liability for the portion of debts chargeable to his wife's community property was, however, accompanied by a right over against her half of the community. Ibid. The basic rule of Texas law is that the community is liable for its debts, and, accordingly, half the debts attach to the wife's community property. Since the will of the decedent cannot be allowed to define what is an 'obligation' or a 'claim,' where, as in this case, the community is solvent, the debts chargeable to the wife's property cannot realistically be deemed 'personal obligations' of the decedent or 'claims against' his estate.
26
The provisions of § 812(b), like those of § 812(e) allowing marital deductions, must be analyzed in light of the congressional purpose of equalizing the incidence of taxation upon couples in common-law and community property jurisdictions. If the deductible 'claims' were to include all community debts that might be, in a literal sense, 'personal obligations' of the husband as surety, then a married couple in a community property State might readily increase their tax free estate transfers. For example, by borrowing against the value of the community property and then requiring that his executors pay all community debts, the husband could obtain a tax deduction for what would in effect be a testamentary gift to his wife.20 That gift might or might not qualify for treatment as a marital deduction,21 but it certainly was not intended to be made deductible by § 812(b). A contrary interpretation of § 812(b)(3) would, in our opinion, generally tend to create unwarranted tax advantages for couples in community property States.22
27
B. Administration Expenses.
28
The testator's will provided that administration expenses, as well as community debts, should be paid entirely out of his half of the community property. The administration expenses totalled $4,073. Under Texas law an allocable share of these costs was chargeable to the surviving spouse's community property. That allocable share was determined to be 35% or $1,426. The issue is whether the executors' payment of the costs attributable to the wife's property are deductible 'administration expenses * * * allowed by' the law of the State under § 812(b)(2).
29
The interpretation of 'administration expenses' under § 812(b)(2) involves substantially the same considerations that determine the interpretation of 'claims against the estate' under § 812(b)(3). In both instances, the testator, by directing that payment be made of debts chargeable to another or to non-estate property, reduces his net estate and in effect confers a gift or bequest upon another. We believe that the provisions of § 812(b), like those of § 812(e) providing the marital deduction, must be read in light of the general policies of taxing the transmission of wealth at death and of equalizing the tax treatment of couples in common-law and in community property jurisdictions. We hold, therefore, that a deduction may not be allowed for administration costs chargeable to the surviving spouse's community property.
30
C. The Payment of Debts and Expenses as a Marital Gift.
31
In our view the payments made as a result of the testator's assumption of responsibility both for his wife's share of the community debts and for her share of the administration expenses are more properly characterized as material gifts rather than as 'claims' or 'expenses.' Since these gifts were to the surviving spouse, respondents contend that a marital deduction should be allowed. Our interpretation of § 812(e) disposes of this argument, for under any view of the facts, even if these items are deemed to be gifts to the wife, the will required her to surrender property more valuable than the bequests she received.23 In the absence of a net benefit passing to the surviving spouse, no marital deduction is allowable.
32
The judgment of the Court of Appeals for the Fifth Circuit is reversed and the case remanded for proceedings in accordance with this opinion.
33
It is so ordered.
34
Reversed and remanded.
1
62 Stat. 117 (1948), now Int.Rev.Code of 1954, § 2056(b)(4)(B). The provisions involved are § 812(e)(1)(A) and (E)(ii):
'(e) Bequests, etc., to surviving spouse
'(1) Allowance of marital deduction
'(A) In general. An amount equal to the value of any interest in property which passes or has passed from the decedent to his surviving spouse, but only to the extent that such interest is included in determining the value of the gross estate.
'(E) Valuation Of interest passing To surviving spouse. In determining for the purposes of subparagraph (A) the value of any interest in property passing to the surviving spouse for which a deduction is allowed by this subsection—
'(ii) where such interest or property is incumbered in any manner, or where the surviving spouse incurs any obligation imposed by the decedent with respect to the passing of such interest, such incumbrance or obligation shall be taken into account in the same manner as if the amount of a gift to such spouse of such interest were being determined.'
2
53 Stat. 123 (1939), now Int.Rev.Code of 1954, § 2053(a). Subsequent references will be to the 1939 Code under which the case arose. The pertinent provisions of § 812(b) authorize deductions for:
'(b) Expenses, losses, indebtedness, and taxes. Such amounts—
'(1) for funeral expenses,
'(2) for administration expenses,
'(3) for claims against the estate, and
'(4) for unpaid mortgages upon, or any indebtedness in respect to, property where the value of decedent's interest therein, undiminished by such mortgage or indebtedness, is included in the value of the gross estate,
'as are allowed by the laws of the jurisdiction, whether within or without the United States, under which the estate is being administered, but not including any income taxes upon income received after the death of the decedent, or property taxes not accrued before his death, or any estate, succession, legacy, or inheritance taxes. The deduction herein allowed in the case of claims against the estate, unpaid mortgages, or any indebtedness shall, when founded upon a promise or agreement, be limited to the extent that they were contracted bona fide and for an adequate and full consideration in money or money's worth * * *.'
3
The figures stated throughout are rounded to the nearer dollar.
4
The apportionment of administration expenses was initially determined by a revenue examiner and was sust ined by the District Court. D.C., 189 F.Supp. 830, 838.
5
This includes $700 for an automobile specifically bequeathed to Mrs. Stapf. There is some question as to whether Mrs. Stapf should be credited with receiving the full value of the automobile ($1,400) or only a one-half interest ($700). For present purposes the difference is immaterial for it is insufficient to alter the basic fact that the widow did not receive a net benefit by electing to take under the will. We therefore accept the figures used by the courts below and consider Mrs. Stapf as receiving only a one-half interest ($700) in the automobile.
6
The parties agree that the net effect of taking under the will may be computed by another method. As explained by the Court of Appeals, 'Computed differently but with the same result, the widow retained a one-third interest out of the one-half of the community owned by her, thereby transferring only a one-sixth interest under the election to take. Under this method of computation she transferred property having a valuation of $27,541.16 and received property being the one-third interest in the separate property of the husband and the one-half interest in the automobile of the aggregate value of the $22,366.66, making a net loss to her of $5,174.50.' 309 F.2d 592, 594.
7
The Commissioner did in fact allow a marital deduction for $700, representing a one-half interest in the automobile. 309 F.2d 592, 597, n. 5. That allowance was not challenged by the Government in the District Court. We therefore do not review the judgment of the Court of Appeals insofar as it allows this $700 deduction.
8
See, e.g., Commissioner of Internal Revenue v. Wemyss, 324 U.S. 303, 65 S.Ct. 652, 89 L.Ed. 958. There the Court stated that under the Revenue Act of 1932 mere detriment to the transferee did not constitute the requisite 'consideration in money or money's worth' to the transferor so as to relieve him of gift tax liability. Respondents' reliance on this case ignores that it involved neither a determination of who was to be considered the beneficial donee nor a valuation of the gift received by such donee.
9
The portion of the language relied upon provides that the valuation be 'in the same manner as if the amount of a gift to such spouse of such interest were being determined.'
10
Treas.Reg. 105, § 81.47c(b)(3) (1949), now Treas.Reg. § 20.2056(b)—4(b) (3) (1958). The Regulation provides another relevant illustration 'of property interests which passed from the decedent to his surviving spouse subject to the imposition of an obligation by the decedent: (1) A decedent devised a residence valued at $25,000 to his wife, with a direction that she pay $5,000 to his sister. For the purpose of the marital deduction, the value of the property interest passing to the wife is only $20,000.'
See Lowndes and Kramer, Federal Estate and Gift Taxes (1962), § 17.4: '(W)hat the Regulations are driving at seems to be this. If a decedent bequeaths property to his wife in lieu of her interest in community property, which is not part of his estate and which does not pass to her from him, it seems clear that the only thing which the surviving spouse actually receives from the decedent is the excess of the interest bequeathed to her over and above the value of her interest in the community property. Therefore, this should be the only amount which qualifies for the marital deduction * * *.'
11
This Court has frequently 'given considerable and in some cases decisive weight to * * * interpretative regulations of the Treasury and of other bodies that were not of adversary origin.' Skidmore v. Swift & Co., 323 U.S. 134, 140, 65 S.Ct. 61, 164, 89 L.Ed. 124. Although the weight to be given to an interpretative rule varies with its statutory and legislative context, a Treasury Regulation is particularly persuasive when, as in this case, it is supported by declarations of congressional intent.
12
See H.R.Rep. No. 1274, 80th Cong., 2d Sess., pp. 24—26; U.S.Code Cong.Service 1948, p. 1258; S.Rep.No.1013, 80th Cong., 2d Sess., pp. 26—29; U.S.Code Cong.Service 1948, p. 1163; Sugarman, Estate and Gift Tax Equalization—The Marital Deduction (1948), 36 Cal.L.Rev. 223, 228—230.
13
The congressional concerns with the eventual taxability of marital-deduction property is indicated by the terminable interest rule of § 812(e)(1) (B). See S.Rep. No. 1013, supra note 12, p. 28; Warren and Surrey, Federal Estate and Gift Taxation (1961), pp. 759—760.
14
The Court of Appeals recognized the effect of its decision: 'Here estate taxes are due now on the property of the husband with the devise to the widow excluded. It is a part of the marital deduction or exclusion on which taxes are deferred to the estate of the widow to be assessed on so much of it as survives on another day. The net of the transfer by the widow became subject to gift taxes at the time of the transfer. The property transferred by the widow will, to the extent of an amount equal to the devise to her, escape both gift and estate taxes.' 309 F.2d 592, 598. For an illustration of the tax effects of the decision, see the dissent of Judge Wisdom. 309 F.2d, at 608—609.
15
See 76 Harv.L.Rev. 1671, 1675.
16
See Morgan v. Commissioner, 309 U.S. 78, 80—81, 60 S.Ct. 424, 426, 84 L.Ed. 585 (concerning the meaning of 'general power of appointment' under a federal revenue act): 'State law creates legal interests and rights. The federal revenue acts designate what interests, or rights, so created, shall be taxed. Our duty is to ascertain the meaning of the words used to specify the thing taxed. If it is found in a given case that an interest or right created by local law was the object intended to be taxed, the federal law must prevail no matter what name is given to the interest or right by state law.' See Hart and Wechsler, The Federal Courts and the Federal System (1953), pp. 456—457.
17
See, e.g., Lowndes and Kramer, op. cit., supra, note 10, §§ 1.2, 2.2.
18
The majority of the Court of Appeals passed over the adequate-consideration provision because 'the debts here were in the main for income taxes and ad valorem taxes, debts imposed by law.' 309 F.2d 592, 596. However, since one-half of the taxes were chargeable to the wife's community property, the disputed claims were in fact imposed on the estate only by the terms of the will and the widow's election to take under those terms.
19
Treas.Reg. 105, § 81.36 (1942), now Treas.Reg. § 20.2053 4 (1958): 'Claims against the estate.—The amounts that may be deducted under this heading are such only as represent personal obligations of the decedent existing at the time of his death, whether or not then matured, and interest thereon which had accrued at the time of death. * * * Only claims enforceable against the decedent's estate may be deducted. * * *' With regard to the disputed deduction for the wife's share of community debts, it has been suggested that: 'because the decedent's estate is not bound, even under state law, until after the widow elects, allowance of the deduction may be incompatible with the regulation requiring that the claims be in existence at the decedent's death. This requirement could only be fulfilled by an election which would work retroactively.' 37 Tul.L.Rev. 297, 315.
20
309 F.2d 592, 604 (Wisdom, J., dissenting): 'For example, in the twilight of their years, a couple with community property worth $1,000,000 could borrow an additional $1,000,000 and invest it in securities using the $2,000,000 as collateral. As a result, the community property would be increased from one million to two million dollars, and would have debts against it of one million dollars. If the husband provided by will that all community debts be paid out of his share of the community property, upon his death his share of the community property would be worth $1,000,000. All of this, however, would be matched by deductible community debts. Thus, under the Court's holding, the entire 'net' estate of $1,000 000 would pass, untaxed, to the wife.'
21
See infra, p. 134.
22
See 76 Harv.L.Rev. 1671, 1675.
23
Respondents concede that 'even with the benefit of the bequest of 1/3 of the separate property to her and the benefit of the debt and expense assumption provisions, Mrs. Stapf ended up with less than she would have owned had she elected to take against the will.' Her share of the gross community assets was $129,052. The portion of the debts ($16,184) and administration expenses ($1,426) chargeable to her was $17,610. When the assumption of the debts and expenses is viewed as a legacy, the effect of taking under the will may be summarized as follows: Mrs. Stapf in effect retained one-third of the total community property remaining after certain bequests ($83,902; see note 5, supra) and allowed the balance of her community ($129,052 minus $83,902) to pass into the trust for the children. Thus she gave up property worth $45,151. In return she was given separate property value at $22,367 (see note 6, supra) and the benefit of the debt and expense assumption, or $17,610, a total transfer of $39,976. Thus, the exchange produced a net loss to Mrs. Stapf of $5,175.
| 1112
|
375 U.S. 180
84 S.Ct. 275
11 L.Ed.2d 237
SECURITIES AND EXCHANGE COMMISSION, Petitioner,v.CAPITAL GAINS RESEARCH BUREAU, INC., et al.
No. 42.
Argued Oct. 21, 1963.
Decided Dec. 9, 1963.
David Ferber, Washington, D.C., for petitioner.
Leo C. Fennelly, New York City, for respondents.
Mr. Justice GOLDBERG delivered the opinion of the Court.
1
We are called upon in this case to decide whether under the Investment Advisers Act of 19401 the Securities and Exchange Commission may obtain an injunction compelling a registered investment adviser to disclose to his clients a practice of purchasing shares of a security for his own account shortly before recommending that security for long-term investment and then immediately selling the shares at a profit upon the rise in the market price following the recommendation. The answer to this question turns on whether the practice—known in the trade as 'scalping'—'operates as a fraud or deceit upon any client or prospective client' within the meaning of the Act.2 We hold that it does and that the Commission may 'enforce compliance' with the Act by obtaining an injunction requiring the adviser to make full disclosure of the practice to his clients.3
2
The Commission brought this action against respondents in the United States District Court for the Southern District of New York. At the hearing on the application for a preliminary injunction, the following facts were established. Respondents publish two investment advisory services, one of which—'a Capital Gains Report'—is the subject of this proceeding. The Report is mailed monthly to approximately 5,000 subscribers who each pay an annual subscription price of $18. It carries the following description:
3
'An Investment Service devoted exclusively to (1) The protection of investment capital. (2) The realization of a steady and attrative income therefrom. (3) The accumulation of CAPITAL GAINS thru the timely purchase of corporate equities that are proved to be undervalued.'
4
Between March 15, 1960, and November 7, 1960, respondents, on six different occasions, purchased shares of a particular security shortly before recommending it in the Report for long-term investment. On each occasion, there was an increase in the market price and the volume of trading of the recommended security within a few days after the distribution of the Report. Immediately thereafter, respondents sold their shares of these securities at a profit.4 They did not disclose any aspect of these transactions to their clients or prospective clients.
5
On the basis of the above facts, the Commission requested a preliminary injunction as necessary to effectuate the purposes of the Investment Advisers Act of 1940. The injunction would have required respondents, in any future Report, to disclose the material facts concerning, inter alia, any purchase of recommended securities 'within a very short period prior to the distribution of a recommendation * * *,' and '(t)he intent to sell and the sale of said securities * * * within a very short period after distribution of said recommendation * * *.'5
6
The District Court denied the request for a preliminary injunction, holding that the words 'fraud' and 'deceit' are used in the Investment Advisers Act of 1940 'in their technical sense' and that the Commission had failed to show an intent to injure clients or an actual loss of money to clients. D.C., 191 F.Supp. 897. The Court of Appeals for the Second Circuit, sitting en banc, by a 5-to-4 vote accepted the District Court's limited construction of 'fraud' and 'deceit' and affirmed the denial of injunctive relief.6 2 Cir., 306 F.2d 606. The majority concluded that no violation of the Act could be found absent proof that 'any misstatements or false figures were contained in any of the bulletins'; or that 'the investment advice was unsound'; or that 'defendants were being bribed or paid to tout a stock contrary to their own beliefs'; or that 'these bulletins were a scheme to get rid of worthless stock'; or that the recommendations were made 'for the purpose of endeavoring artificially to raise the market so that (respondents) might unload (their) holdings at a profit.' Id., 306 F.2d at 608—609. The four dissenting judges pointed out that '(t)he common-law doctrines of fraud and deceit grew up in a business climate very different from that involved in the sale of securities,' and urged a broad remedial construction of the statute which would encompass respondents' conduct. Id., 306 F.2d at 614. We granted certiorari to consider the question of statutory construction because of its importance to the investing public and the financial community. 371 U.S. 967, 83 S.Ct. 550, 9 L.Ed.2d 538.
7
The decision in this case turns on whether Congress, in empowering the courts to enjoin any practice which operates 'as a fraud or deceit upon any client or prospective client,' intended to require the Commission to establish fraud and deceit 'in their technical sense,' including intent to injure and actual injury to clients, or whether Congress intended a broad remedial construction of the Act which would encompass nondisclosure of material facts. For resolution of this issue we consider the history and purpose of the Investment Advisers Act of 1940.
I.
8
The Investment Advisers Act of 1940 was the last in a series of Acts designed to eliminate certain abuses in the securities industry, abuses which were found to have contributed to the stock market crash of 1929 and the depression of the 1930's.7 It was preceded by the Securities Act of 1933,8 the Securities Exchange Act of 1934,9 the Public Utility Holding Company Act of 1935,10 the Trust Indenture Act of 1939,11 and the Investment Company Act of 1940.12 A fundamental purpose, common to these statutes, was to substitute a philosophy of full disclosure for the philosophy of caveat emptor and thus to achieve a high standard of business ethics in the securities industry.13 As we recently said in a related context, 'It requires but little appreciation * * * of what happened in this country during the 1920's and 1930's to realize how essential it is that the highest ethical standards prevail' in every facet of the securities industry. Silver v. New York Stock Exchange, 373 U.S. 341, 366, 83 S.Ct. 1246, 1262, 10 L.Ed.2d 389.
9
The Public Utility Holding Company Act of 1935 'authorized and directed' the Securities and Exchange Commission 'to make a study of the functions and activities of investment trusts and investment companies * * *.'14 Pursuant to this mandate, the Commission made an exhaustive study and report which included consideration of investment counsel and investment advisory services.15 This aspect of the study and report culminated in the Investment Advisers Act of 1940.
10
The report reflects the attitude—shared by investment advisers and the Commission—that investment advisers could not 'completely perform their basic function—furnishing to clients on a personal basis competent, unbiased, and continuous advice regarding the sound management of their investments—unless all conflicts of interest between the investment counsel and the client were removed.'16 The report stressed that affiliations by investment advisers with investment bankers or corporations might be 'an impediment to a disinterested, objective, or critical attitude toward an investment by clients * * *.'17
11
This concern was not limited to deliberate or conscious impediments to objectivity. Both the advisers and the Commission were well aware that whenever advice to a client might result in financial benefit to the adviser—other than the fee for his advice 'that advice to a client might in some way be tinged with that pecuniary interest (whether consciously or) subconsciously motivated * * *.'18 The report quoted one leading investment adviser who said that he 'would put the emphasis * * * on subconscious' motivation in such situations.19 It quoted a member of the Commission staff who suggested that a significant part of the problem was not the existence of a 'deliberate intent' to obtain a financial advantage, but rather the existence 'subconsciously (of) a prejudice' in favor of one's own financial interests.20 The report incorporated the Code of Ethics and Standards of Practice of one of the leading investment counsel associations, which contained the following canon:
12
'(An investment adviser) should continuously occupy an impartial and disinterested position, as free as humanly possible from the subtle influence of prejudice, conscious or nconscious; he should scrupulously avoid any affiliation, or any act, which subjects his position to challenge in this respect.'21 (Emphasis added.)
13
Other canons appended to the report announced the following guiding principles: that compensation for investment advice 'should consist exclusively of direct charges to clients for services rendered';22 that the adviser should devote his time 'exclusively to the performance' of his advisory function;23 that he should not 'share in profits' of his clients;24 and that he should not 'directly or indirectly engage in any activity which may jeopardize (his) ability to render unbiased investment advice.'25 These canons were adopted 'to the end that the quality of services to be rendered by investment counselors may measure up to the high standards which the public has a right to expect and to demand.'26
14
One activity specifically mentioned and condemned by investment advisers who testified before the Commission was 'trading by investment counselors for their own account in securities in which their clients were interested * * *.'27
15
This study and report—authorized and directed by statute28 culminated in the preparation and introduction by Senator Wagner of the bill which, with some changes, became the Investment Advisers Act of 1940.29 In its 'declaration of policy' the original bill stated that
16
'Upon the basis of facts disclosed by the record and report of the Securities and Exchange Commission * * * it is hereby declared that the national public interest and the interest of investors are adversely affected—* * * (4) when the business of investment advisers is so conducted as to defraud or mislead investors, or to enable such advisers to relieve themselves of their fiduciary obligations to their clients.
17
'It is hereby declared that the policy and purposes of this title, in accordance with which the provisions of this title shall be interpreted, are to mitigate and, so far as is presently practicable to eliminate the abuses enumerated in this section.' S. 3580, 76th Cong., 3d Sess., § 202.
18
Hearings were then held before Committees of both Houses of Congress.30 In describing their profession, leading investment advisers emphasized their relationship of 'trust and confidence' with their clients31 and the importance of 'strict limitation of (their right) to buy and sell securities in the normal way if there is any chance at all that to do so might seem to operate against the interests of clients and the public.'32 The president of the Investment Counsel Association of America, the leading investment counsel association, testified that the
19
'two fundamental principles upon which the pioneers in this new profession undertook to meet the growing need for unbiased investment information and guidance were, first, that they would limit their efforts and activities to the study of investment problems from the investor's standpoint, not engaging in any other activity, such as security selling or brokerage, which might directly or indirectly bias their investment judgment; and, second, that their remuneration for this work would consist solely of definite, professional fees fully disclosed in advance.'33
20
Although certain changes were made in the bill following the hearings,34 there is nothing to indicate an intent to alter the fundamental purposes of the legislation. The broad proscription against 'any * * * practice * * * which operates * * * as a fraud or deceit upon any client or prospective client' remained in the bill from beginning to end. And the Committee Reports indicate a desire to preserve 'the personalized character of the services of investment advisers,'35 and to eliminate conflicts of interest between the investment adviser and the clients36 as safeguards both to 'unsophisticated investors' and to 'bona fide investment counsel.'37 The Investment Advisers Act of 1940 thus reflects a congressional recognition 'of the delicate fiduciary nature of an investment advisory relationship,'38 as well as a congressional intent to eliminate, or at least to expose, all conflicts of interest which might incline as investment adviser— consciously or unconsciously—to render advice which was not disinterested. It would defeat the manifest purpose of the Investment Advisers Act of 1940 for us to hold, therefore, that Congress, in empowering the courts to enjoin any practice which operates 'as a fraud or deceit,' intended to require proof of intent to injure and actual injury to clients.
21
This conclusion moreover, is not in derogation of the common law of fraud, as the District Court and the majority of the Court of Appeals suggested. To the contrary, it finds support in the process by which the courts have adapted the common law of fraud to the commercial transactions of our society. It is true that at common law intent and injury have been deemed essential elements in a damage suit between parties to an arm's-length transaction.39 But this it not such an action.40 This is a suit for a preliminary injunction in which the relief sought is, as the dissenting judges below characterized it, the 'mild prophylactic,' 306 F.2d, at 613, of requiring a fiduciary to disclose to his clients, not all his security holdings, but only his dealings in recommended securities just before and after the issuance of his recommendations.
22
The content of common-law fraud has not remained static as the courts below seem to have assumed. It has varied, for example, with the nature of the relief sought, the relationship between the parties, and the merchandise in issue. It is not necessary in a suit for equitable or prophylactic relief to establish all the elements required in a suit for monetary damages.
23
'Law had come to regard fraud * * * as primarily a tort, and hedged about with stringent requirements, the chief of which was a strong moral, or rather immoral element, while equity regarded it, as it had all along regarded it, as a conveniently comprehensive word for the expression of a lapse from the high standard of conscientiousness that it exacted from any party occupying a certain contractual or fiduciary relation towards another party.'41
24
'Fraud has a broader meaning in equity (than at law) and intention to defraud or to misrepresent is not a necessary element.'42
25
'Fraud, indeed, in the sense of a court of equity properly includes all acts, omissions and concealments which involve a breach of legal or equitable duty, trust, or confidence, justly reposed, and are injurious to another, or by which an undue and unconscientious advantage is taken of another.'43
26
Nor is it necessary in a suit against a fiduciary, which Congress recognized the investment adviser to be, to establish all the elements required in a suit against a party to an arm's-length transaction. Courts have imposed on a fiduciary an affirmative duty of 'utmost good faith, and full and fair disclosure of all material facts,'44 as well as an affirmative obligation 'to employ reasonable care to avoid misleading'45 his clients. There has also been a growing recognition by common-law courts that the doctrines of fraud and deceit which developed around transactions involving land and other tangible items of wealth are ill-suited to the sale of such intangibles as advice and securities, and that, accordingly, the doctrines must be adapted to the merchandise in issue.46 The 1909 New York case of Ridgely v. Keene, 134 App.Div. 647, 119 N.Y.S. 451, illustrates this continuing development. An investment adviser who, like respondents, published an investment advisory service, agreed, for compensation, to influence his clients to buy shares in a certain security. He did not disclose the agreement to his client but sought 'to excuse his conduct by assertin that * * * he honestly believed, that his subscribers would profit by his advice * * *.' The court, holding that 'his belief in the soundness of his advice is wholly immaterial,' declared the act in question 'a palpable fraud.'
27
We cannot assume that Congress, in enacting legislation to prevent fraudulent practices by investment advisers, was unaware of these developments in the common law of fraud. Thus, even if we were to agree with the courts below that Congress had intended, in effect, to codify the common law of fraud in the Investment Advisers Act of 1940, it would be logical to conclude that Congress codified the common law 'remedially' as the courts had adapted it to the prevention of fraudulent securities transactions by fiduciaries, not 'technically' as it has traditionally been applied in damage suits between parties to arm's-length transactions involving land and ordinary chattels.
28
The foregoing analysis of the judicial treatment of common-law fraud reinforces our conclusion that Congress, in empowering the courts to enjoin any practice which operates 'as a fraud or deceit' upon a client, did not intend to require proof of intent to injure and actual injury to the client. Congress intended the Investment Advisers Act of 1940 to be construed like other securities legislation 'enacted for the purpose of avoiding frauds,'47 not technically and restrictively, but flexibly to effectuate its remedial purposes.
II.
29
We turn now to a consideration of whether the specific conduct here in issue was the type which Congress intended to reach in the Investment Advisers Act of 1940. It is arguable—indeed it was argued by 'some investment counsel representatives' who testified before the Commission—that any 'trading by investment counselors for their own account in securities in which their clients were interested * * *'48 creates a potential conflict of interest which must be eliminated. We need not go that far in this case, since here the Commission seeks only disclosure of a conflict of interests with significantly greater potential for abuse than in the situation described above. An adviser who, like respondents, secretly trades on the market effect of his own recommendation may be motivated—consciously or unconsciously—to recommend a given security not because of its potential for long-run price increase (which would profit the client), but because of its potential for short-run price increase in response to anticipated activity from the recommendation (which would profit the adviser).49 An investor seeking the advice of a registered investment adviser must, if the legislative purpose is to be served, be permitted to evaluate such overlapping motivations, through appropriate disclosure, in deciding whether an adviser is serving 'two masters' or only one, 'especially * * * if one of the masters happens to be economic self-interest.' United States v. Mississippi Valley Generating Co., 364 U.S. 520, 549, 81 S.Ct. 294, 308, 309, 5 L.Ed.2d 268.50 Accordingly, we hold that the Investment Advisers Act of 1940 empowers the courts, upon a showing such as that made here, to require an adviser to make full and frank disclosure of his practice of trading on the effect of his recommendations.
III.
30
Respondents offer three basic arguments against this conclusion. They argue first that Congress could have made, but did not make, failure to disclose material facts unlawful in the Investment Advisers Act of 1940, as it did in the Securities Act of 1933,51 and that absent specific language, it should not be assumed that Congress intended to include failure to disclose in its general proscription of any practice which operates as a fraud or deceit. But considering the history and chronology of the statutes, this omission does not seem significant. The Securities Act of 1933 was the first experiment in federal regulation of the securities industry. It was understandable, therefore, for Congress, in declaring certain practices unlawful, to include both a general proscription against fraudulent and deceptive practices and, out of an abundance of caution, a specific proscription against nondisclosure. It soon became clear, however, that the courts, aware of the previously outlined developments in the common law of fraud, were merging the proscription against nondisclosure into the general proscription against fraud, treating the former, in effect, as one variety of the latter. For example, in Securities & Exchange Comm'n v. Torr, 15 F.Supp. 315 (D.C.S.D.N.Y.1936), rev'd on other grounds, 2 Cir., 87 F.2d 446, Judge Patterson held that suppression of information material to an evaluation of the disinterestedness of investment advice 'operated as a deceit on purchasers,' 15 F.Supp., at 317. Later cases also treated nondisclosure as one variety of fraud or deceit.52 In light of this, and in light of the evident purpose of the Investment Advisers Act of 1940 to substitute a philosophy of disclosure for the philosophy of caveat emptor, we cannot assume that the omission in the 1940 Act of a specific proscription against nondisclosure was intended to limit the application of the antifraud and antideceit provisions of the Act so as to render the Commission impotent to enjoin suppression of material facts. The more reasonable assumption, considering what had transpired between 1933 and 1940, is that Congress, in enacting the Investment Advisers Act of 1940 and proscribing any practice which operates 'as a fraud or deceit,' deemed a specific proscription against nondisclosure surplusage.
31
Respondents also argue that the 1960 amendment53 to the Investment Advisers Act of 1940 justifies a narrow interpretation of the original enactment. The amendment made two significant changes which are relevant here. 'Manipulative' practices were added to the list of those specifically proscribed. There is nothing to suggest, however, that with respect to a requirement of disclosure, 'manipulative' is any broader than fraudulent or deceptive.54 Nor is there any indication that by adding the new proscription Congress intended to narrow the scope of the original proscription. The new amendment also authorizes the Commission 'by rules and regulations (to) define, and prescribe means reasonably designed to prevent, such acts, practices, and courses of business as are fraudulent, deceptive, or manipulative.' The legislative history offers no indication, however, that Congress intended such rules to substitute for the 'general and flexible' antifraud provisions which have long been considered necessary to control 'the versatile inventions of fraud-doers.'55 Moreover, the intent of Congress must be culled from the events surrounding the passage of the 1940 legislation. '(O)pinions attributed to a Congress twenty years after the event cannot be considered evidence of the intent of the Congress of 1940.' Securities & Exchange Comm'n v. Capital Gains Research Bureau, Inc., 306 F.2d 606, 615 (dissenting opinion). See United States v. Philadelphia Nat. Bank, 374 U.S. 321, 348—349, 83 S.Ct. 1715, 1733—1734, 10 L.Ed.2d 915.
32
Respondents argue, finally, that their advice was 'honest' in the sense that they believed it was sound and did not offer it for the purpose of furthering personal pecuniary objectives. This, of course, is but another way of putting the rejected argument that the elements of technical common-law fraud—particularly intent must be established before an injunction requiring disclosure may be ordered. It is the practice itself, however, with its potential for abuse, which 'operates as a fraud or deceit' within the meaning of the Act when relevant information is suppressed. The Investment Advisers Act of 1940 was 'directed not only at dischonor, but also at conduct that tempts dishonor.' United States v. Mississippi Valley Generating Co., 364 U.S. 520, 549, 81 S.Ct. 294, 308, 309, 5 L.Ed.2d 268. Failure to disclose material facts must be deemed fraud or deceit within its intended meaning, for, as the experience of the 1920's and 1930's amply reveals, the darkness and ignorance of commercial secrecy are the conditions upon which predatory practices best thrive. To impose upon the Securities and Exchange Commission the burden of showing deliberate dishonesty a a condition precedent to protecting investors through the prophylaxis of disclosure would effectively nullify the protective purposes of the statute. Reading the Act in light of its background we find no such requirement commanded. Neither the Commission nor the courts should be required 'to separate the mental urges,' Peterson v. Greenville, 373 U.S. 244, 248, 83 S.Ct. 1119, 1121, 10 L.Ed.2d 323, of an investment adviser, for '(t)he motives of man are too complex * * * to separate * * *.' Mosser v. Darrow, 341 U.S. 267, 271, 71 S.Ct. 680, 682, 95 L.Ed. 927. The statute, in recognition of the adviser's fiduciary relationship to his clients, requires that his advice be disinterested. To insure this it empowers the courts to require disclosure of material facts. It misconceives the purpose of the statute to confine its application to 'dishonest' as opposed to 'honest' motives. As Dean Shulman said in discussing the nature of securities transactions, what is required is 'a picture not simply of the show window, but of the entire store * * * not simply truth in the statements volunteered, but disclosure.'56 The high standards of business morality exacted by our laws regulating the securities industry do not permit an investment adviser to trade on the market effect of his own recommendations without fully and fairly revealing his personal interests in these recommendations to his clients.
33
Experience has shown that disclosure in such situations, while not onerous to the adviser, is needed to preserve the climate of fair dealing which is so essential to maintain public confidence in the securities industry and to preserve the economic health of the country.
34
The judgment of the Court of Appeals is reversed and the case is remanded to the District Court for proceedings consistent with this opinion.
35
Reversed and remanded.
36
Mr. Justice DOUGLAS took no part in the consideration or decision of this case.
APPENDIX TO OPINION OF THE COURT.
37
On none occasion respondents sold short some shares of a security immediately before stating in their Report that the security was overpriced. After the publication of the Report, respondents covered their short sales.
38
Respondents' transactions are summarized by the Commission as follows:
39
Stock Purchased Purchase Recommended Sold Sale Profit
40
price price
41
Continental 47 3/4 -
42
Insurance Co. 3/15/60 47 7/8 3/18/60 3/29/60 50 1/8 $1,125.00
43
United Fruit 5/13, 16, 21 1/4 - 6/6, 7, 23 5/8 10,725.00
44
Co. 19, 20/60, 22 1/8 5/27/60 9, 10, 60 - 24 1/2
Creole Petroleum
45
Corp 7/5, 25 1/4 - 7/15/60 7/20, 21, 27 1/8 1,762.50
46
14/60 28 3/4 22/60 - 29
47
Hart, Schaffner & Marx 8/8/60 23 8/12/60 8/18, 24 7/8 837.00
22/60 - 25 1/4
48
Union Pacific 10/28, 25 3/8 - 11/1/60 11/7/60 27 1,757.00
31/60 25 5/8
49
Frank G. Shattuck Co 10/11/60 16.83 (2.53 10/14/60 10/25/60 19 1/2 - 695.17
50
(purchased call cost, (exercised 20 1/8
51
calls) plus 14.30 calls and
52
option price) sold)
53
Chock Full O'Nuts 10/14/60 68 3/4 - 69 10/14/60 10/24/60 62 - 2,772.33
54
(sold short). (sale price). (disparaged).
55
(covered 62 1/2
56
short sale)(purchase
57
price)
58
Although some of the above figures relating to profits are disput ed, respondents do not substantially contest the remaining figures.
59
Mr. Justice HARLAN, dissenting.
60
I would affirm the judgment below substantially for the reasons given by Judge Moore in his opinion for the majority of the Court of Appeals sitting en banc, 2 Cir., 306 F.2d 606, and in his earlier opinion for the panel. 2 Cir., 300 F.2d 745. A few additional observations are in order.
61
Contrary to the majority, I do not read the Court of Appeals' en banc opinion as holding that either § 206(1) of the Investment Advisers Act of 1940, 54 Stat. 847 (prohibiting the employment of 'any device, scheme, or artifice to defraud any client or prospective client'), or § 206(2), 54 Stat. 847 (prohibiting the engaging 'in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client'), is confined by traditional common law concepts of fraud and deceit. That court recognized that 'federal securities laws are to be construed broadly to effectuate their remedial purpose.' 306 F.2d, at 608. It did not hold or intimate that proof of 'intent to injure and actual injury to clients' (ante, p. 186) was necessary to make out a case under these sections of the statute. Rather it explicitly observed: 'Nor can there be any serious dispute that a relationship of trust and confidence should exist between the advisor and the advised,' ibid., thus recognizing that no such proof was required. In effect the Court of Appeals simply held that the terms of the statute require, at least, some proof that an investment adviser's recommendations are not disinterested.
62
I think it clear that what was shown here would not make out a case of fraud or breach of fiduciary relationship under the most expansive concepts of common law or equitable principles. The nondisclosed facts indicate no more than that the respondents personally profited from the foreseeable reaction to sound and impartial investment advice.1
63
The cases cited by the Court (ante, p. 198) are wide of the mark as even a skeletonized statement of them will show. In Securities & Exchange Comm'n v. Torr, 15 F.Supp. 315, reversed on other grounds, 87 F.2d 446, defendants were in effect bribed to recommend a certain stock. Although it was not apparent that they lied in making their recommendations, it was plain that they were motivated to make them by the promise of reward. In the case before us, there is no vestige of proof that the reason for the recommendations was anything other than a belief in the soundness of the investment advice given.
64
Charles Hughes & Co. v. Securities & Exchange Comm'n, 139 F.2d 434, involved sales of stock by customers' men to those ignorant of the market value of the stocks at 16% to 41% above the over-the-counter price. Defendant's employees must have known that the customers would have refused to buy had they been aware of the actual market price.
65
The defendant in Norris & Hirshberg, Inc., v. Securities & Exchange Comm'n, 85 U.S.App.D.C. 268, 177 F.2d 228, dealt in unlisted securities. Most of its customers believed that the firm was acting only on their behalf and that its income was derived from commissions; in fact the firm bought from and sold to its customers, and received its income from mark-ups and mark-downs. The nondisclosure of this basic relationship did not, the court stated, 'necessarily establish that petitioner violated the antifraud provisions of the Securities and Securities Exchange Acts.' Id., at 271, 177 F.2d at 231. Defendant's trading practices, however, were found to establish such a violation; an example of these was the buying of shares of stock from one customer and the selling to another at a substantially higher price on the same day. The opinion explicitly distinguishes between what is necessary to prove common law fraud and the grounds under securities legislation sufficient for revo ation of a broker-dealer registration. Id., at 273, 177 F.2d, at 233.
66
Arleen Hughes v. Securities & Exchange Comm'n, 85 U.S.App.D.C. 56, 174 F.2d 969, concerned the revocation of the license of a broker-dealer who also gave investment advice but failed to disclose to customers both the best price at which the securities could be bought in the open market and the price which she had paid for them. Since the court expressly relied on language in statutes and regulations making unlawful 'any omission to state a material fact,' id., at 63, 174 F.2d, at 976, this case hardly stands for the proposition that the result would have been the same had such provisions been absent.
67
In Speed v. Transamerica Corp., 235 F.2d 369, the controlling stockholder of a corporation made a public offer to buy stock, concealing from the other shareholders information known to it as an insider which indicated the real value of the stock to be considerably greater than the price set by the public offer. Had shareholders been aware of the concealment, they would undoubtedly have refused to sell; as a consequence of selling they suffered ascertainable damages.
68
In Archer v. Securities & Exchange Comm'n, 133 F.2d 795, defendant copartners of a company dealing in unlisted securities concealed the name of Claude Westfall, who was found to be in control of the business. Westfall was thereby enabled to defraud the customers of the brokerage firm of Harris, Upham & Co., for which he worked as a trader. Securities of the customers of the latter firm were bought by defendants' company at under the market level, and defendants' company sold securities to the clients of Harris, Upham & Co. at prices above the market.
69
In all of these cases but Arleen Hughes, which turned on explicit provisions against nondisclosure, the concealment involved clearly reflected dischonest dealing that was vital to the consummation of the relevant transactions. No such factors are revealed by the record in the present case. It is apparent that the Court is able to achieve the result reached today only by construing these provisions of the Investment Advisers Act as it might a pure conflict of interest statute, cf. United States v. Mississippi Valley Generating Co., 364 U.S. 520, something which this particular legislation does not purport to be.
70
I can find nothing in the terms of the statute or in its legislative history which lends support to the absolute rule of disclosure now established by the Court. Apart from the other factors dealt with in the two opinions of the Court of Appeals, it seems to me especially significant that Congress in enacting the Investment Advisers Act did not include the express disclosure provision found in § 17(a)(2) of the Securities Act of 1933, 48 Stat. 84,2 even though it did carry over to the Advisers Act the comparable fraud and deceit provisions of the Securities Act.3 To attribute the presence of a disclosure provision in the earlier statute to an 'abundance of caution' (ante, 198) and its omission in the later statute to a congressional belief that its inclusion would be 'surplusage' (ante, 199) is for me a singularly unconvincing explanation of this controlling difference between the two statutes.4
71
However salutary may be thought the disclosure rule now fashioned by the Court, I can find no authority for it either in the statute or in any regulation duly promulgated thereunder by the S.E.C. Only two Terms ago we refused to extend certain provisions of the Securities Exchange Act of 1934 to encompass 'policy' considerations at least as cogent as those urged here by the S.E.C. Blau v. Lehman, 368 U.S. 403, 82 S.Ct. 451, 7 L.Ed.2d 403. The Court should have exercised the same wise judicial restraint in this case. This is particularly so at this interlocutory stage of the litigation. It is conceivable that at the trial the S.E.C. would have been able to make out a case under the statute construed according to its terms.
72
I respectfully dissent.
1
54 Stat. 847, as amended, 15 U.S.C. § 80b—1 et seq.
2
54 Stat. 852, as amended, 15 U.S.C. (Supp. IV) § 80b—6, provides in relevant part that:
'It shall be unlawful for any investment adviser, by use of the mails or any means or instrumentality of interstate commerce, directly or indirectly—
'(1) to employ any device, scheme, or artifice to defraud any client or prospective client;
'(2) to engage in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client;
'(3) acting as principal for his own account, knowingly to sell any security to or purchase any security from a client, or acting as broker for a person other than such client, knowingly to effect any sale or purchase of any security for the account of such client, without disclosing to such client in writing before the completion of such transaction the capacity in which he is acting and obtaining the consent of the client to such transaction. The prohibitions of this paragraph shall not apply to any transaction with a customer of a broker or dealer if such broker or dealer is not acting as an investment adviser in relation to such transaction. * * *'
3
54 Stat. 853, as amended, 15 U.S.C. (Supp. IV) § 80b—9, provides in relevant part that:
'(e) Whenever it shall appear to the Commission that any person has engaged, is engaged, or is about to engage in any act or practice constituting a violation of any provision of this subchapter, or of any rule, regulation, or order hereunder, or that any person has aided, abetted, counseled, commanded, induced, or procured, is aiding, abetting, counseling, commanding, inducing, or procuring, or is about to aid, abet, counsel, command, induce, or procure such a violation, it may in its discretion bring an action in the proper district court of the United States, or the proper United States court of any Territory or other place subject to the jurisdiction of the United States, to enjoin such acts or practices and to enforce compliance with this subchapter or any rule, regulation, or order hereunder. Upon a showing that such person has engaged, is engaged, or is about to engage in any such act or practice, or in aiding, abetting, counseling, c mmanding, inducing, or procuring any such act or practice, a permanent or temporary injunction or decree or restraining order shall be granted without bond.'
4
See Appendix, infra, p. 202.
5
The requested injunction reads in full as follows:
'WHEREFORE the plaintiff demands a temporary restraining order, preliminary injunction and final injunction:
'1. Enjoining the defendants Capital Gains Research Bureau, Inc. and Harry P. Schwarzmann, their agents, servants, employees, at-
torneys and assigns, and each of them, while the said Capital Gains Research Bureau, Inc. is an investment advisor, directly and indirectly, by the use of the mails or any means or instrumentalities of interstate commerce from:
'(a) Employing any device, scheme or artifice to defraud any client or prospective client by failing to disclose the material facts concerning
'(1) The purchase by defendant, Capital Gains Research Bureau, Inc., of securities within a very short period prior to the distribution of a recommendation by said defendant to its clients and prospective clients for purchase of said securities;
'(2) The intent to sell and the sale of said securities by said defendant so recommended to be purchased within a very short period after distribution of said recommendation to its clients and prospective clients;
'(3) Effecting of short sales by said defendant within a very short period prior to the distribution of a recommendation by said defendant to its clients and prospective clients to dispose of said securities;
'(4) The intent of said defendant to purchase and the purchase of said securities to cover its short sales;
'(5) The purchase by said defendant for its own account of puts and calls for securities within a very short period prior to the distribution of a recommendation to its clients and prospective clients forpurchase or disposition of said securities.
'(b) Engaging in any transaction, practice and course of business which operates as a fraud or deceit upon any client or prospective client by failing to disclose the material facts concerning the matters set forth in demand 1(a) hereof.'
6
The case was originally heard before a panel of the Court of Appeals, which, with one judge dissenting, affirmed the District Court. 300 F.2d 745. Rehearing en banc was then ordered.
The Court of Appeals purported to recognize that 'federal securities laws are to be construed broadly to effectuate their remedial purpose.' 306 F.2d 606, 608. But by affirming the District Court's 'technical' construction of the Investment Advisers Act of 1940 and by requiring proof of 'misstatements,' unsound advice, bribery, or intent to unload 'worthless stock,' the court read the statute, in effect, as confined by traditional common-law concepts of fraud and deceit.
7
See generally Douglas and Bates, The Fe eral Securities Act of 1933, 43 Yale L.J. 171 (1933); Loomis, The Securities Exchange Act of 1934 and the Investment Advisers Act of 1940, 28 Geo.Wash.L.Rev. 214 (1959); Shulman, Civil Liability and the Securities Act, 43 Yale L.J. 227 (1933). Cf. Galbraith, The Great Crash (1955).
8
48 Stat. 74, as amended, 15 U.S.C. § 77a et seq.
9
48 Stat. 881, as amended, 15 U.S.C. § 78a et seq.
10
49 Stat. 838, as amended, 15 U.S.C. § 79 et seq.
11
53 Stat. 1149, as amended, 15 U.S.C. § 77aaa et seq.
12
54 Stat. 789, as amended, 15 U.S.C. § 80a—1 et seq.
13
See H.R.Rep. No. 85, 73d Cong., 1st Sess. 2, quoted in Wilko v. Swan, 346 U.S. 427, 430, 74 S.Ct. 182, 184, 98 L.Ed. 168.
14
49 Stat. 837, 15 U.S.C. § 79z—4.
15
While the study concentrated on investment advisory services which provide personalized counseling to investors, see Investment Trusts and Investment Companies, Report of the Securities and Exchange Commission, Pursuant to Section 30 of the Public Utility Holding Company Act of 1935, on Investment Counsel, Investment Management, Investment Supervisory, and Investment Advisory Services, H.R. Doc. No. 477, 76th Cong., 2d Sess. 1 (thereinafter cited as SEC Report) the Senate Committee on Banking and Currency did receive communications from publishers of investment advisory services, see, e.g., Hearings on S. 3580 before Subcommittee of the Senate Committee on Banking and Currency, 76th Cong., 3d Sess., pt. 3 (Exhibits), 1063, and the Act specifically covers 'any person who, for compensation, engages in the business of advising others, either directly or through publications or writings * * *.' 54 Stat. 847, 15 U.S.C. § 80b—2.
16
SEC Report, at 28.
17
Id., at 29.
18
Id., at 24.
19
Ibid.
20
Ibid.
21
Id., at 66—67.
22
Id., at 66.
23
Id., at 65.
24
Id., at 67.
25
Id., at 29.
26
Id., at 66.
27
Id., at 29—30. (Emphasis added.)
28
See text accompanying note 14, supra.
29
S. 3580, 76th Cong., 3d Sess.
30
Hearings on S. 3580 before Subcommittee of the Senate Committee on Banking and Currency, 76th Cong., 3d Sess. (hereinafter cited as Senate Hearings). Hearings on H.R. 10065 before Subcommittee of the House Committee on Interstate and Foreign Commerce, 76th Cong., 3d Sess. (hereinafter cited as House Hearings).
31
Senate Hearings, at 719.
32
Id., at 716.
33
Id., at 724.
34
The bill as enacted did not contain a section attributing specific abuses to the investment adviser profession. This section was eliminated apparently at the urging of the investment advisers who, while not denying that abuses she occurred, attributed them to certain fringe elements in the profession. They feared that a public and general indictment of all investment advisers by Congress would do irreparable harm to their fledgling profession. See, e.g., Senate Hearings, at 715—716. It cannot be inferred, therefore, that the section was eliminated because Congress had concluded that the abuses had not occurred, or because Congress did not desire to prevent their repetition in the future. The more logical inference, considering the legislative background of the Act, is that the section was omitted to avoid condemning an entire profession (which depends for its success on continued public confidence) for the acts of a few.
35
H.R.Rep. No. 2639, 76th Cong., 3d Sess. 28 (hereinafter cited as House Report). See also S.Rep. No. 1775, 76th Cong., 3d Sess. 22 (hereinafter cited as Senate Report).
36
See Senate Report, at 22.
37
Id., at 21.
38
2 Loss, Securities Regulation (2d ed. 1961), 1412.
39
See cases cited in 37 C.J.S. Fraud § 2 (1943), p. 210.
Even in a damage suit between parties to an arm's-length transaction, the intent which must be established need not be an intent to cause injury to the client, as the courts below seem to have assumed. 'It is to be noted that it is not necessary that the person making the misrepresentations intend to cause loss to the other or gain a profit for himself; it is only necessary that he intend action in reliance on the truth of his misrepresentations.' 1 Harper and James, The Law of Torts (1956), 531. '(T)he fact that the defendant was disinterested, that he had the best of motives, and that he thought he was doing the plaintiff a kindness, will not absolve him from liability, so long as he did in fact intend to mislead.' Prosser, Law of Torts (1955), 538. See 3 Restatement, Torts (1938), § 531, Comment b, illustration 3. It is clear that respondents' failure to disclose the practice here in issue was purposeful, and that they intended that action be taken in reliance on the claimed disinterestedness of the service and its exclusive concern for the clients' interests.
40
Neither is this a criminal proceeding for 'willfully' violating the Act, 54 Stat. 857, as amended, 15 U.S.C. § 80b—17, nor a proceeding to revoke or suspend a registration 'in the public interest,' 54 Stat. 850, as amended, 15 U.S.C. § 80b—3. Other considerations may be relevant in such proceedings. Compare Federal Communications Comm'n v. American Broadcasting Co., 347 U.S. 284, 74 S.Ct. 593, 98 L.Ed. 699.
41
Hanbury, Modern Equity (8th ed. 1962), 643. See Letter of Lord Hardwicke to Lord Kames, dated June 30, 1759, printed in Parkes, History of the Court of Chancery (1828), 508, quoted in Snell, Principles of Equity (25th ed. 1960), 496:
'Fraud is infinite, and were a Court of Equity once to lay down rules, how far they would go, and no farther, in extending their relief against it, or to define strictly the species or evidence of it, the jurisdiction would be cramped, and perpetually eluded by new schemes which the fertility of man's invention would contrive.'
42
De Funiak, Handbook of Modern Equity (2d ed. 1956), 235.
43
Moore v. Crawford, 130 U.S. 122, 128, 9 S.Ct. 447, 448, 32 L.Ed. 878, quoting 1 Story, Equity Jur. § 187.
44
Prosser, Law of Torts (1955), 534—535 (citing cases). See generally Keeton, Fraud—Concealment and Non-Disclosure, 15 Texas L.Rev. 1.
45
1 Harper and James, The Law of Torts (1956), 541.
46
See generally Shulman, Civil Liability and the Securities Act, 43 Yale L.J. 227 (1933).
47
3 Sutherland, Statutory Construction (3d ed. 1943), 382 et seq. (citing cases). See Note, 38 N.Y.U.L.Rev. 985; Comment, 30 U. of Chi.L.Rev. 121, 131—147.
48
See text accompanying note 27, supra.
49
For a discussion of the effects of investment advisory service recommendations on the market price of securities, see Note, 51 Calif.L.Rev. 232, 233.
50
This Court, in discussing conflicts of interest, has said:
'The rea on of the rule inhibiting a party who occupies confidential and fiduciary relations toward another from assuming antagonistic positions to his principal in matters involving the subject matter of the trust is sometimes said to rest in a sound public policy, but it also is justified in a recognition of the authoritative declaration that no man can serve two masters; and considering that human nature must be dealt with, the rule does not stop with actual violations of such trust relations, but includes within its purpose the removal of any temptation to violate them. * * *
'* * * In Hazelton v. Sheckells, 202 U.S. 71, 79, 26 S.Ct. 567, 568, 50 L.Ed. 939, we said: 'The objection * * * rests in their tendency, not in what was done in the particular case. * * * The court will not inquire what was done. If that should be improper it probably would be hidden, and would not appear." United States v. Mississippi Valley Generating Co., 364 U.S. 520, 550, 81 S.Ct. 294, 309, 5 L.Ed.2d 268, n. 14.
51
48 Stat. 84, as amended, 15 U.S.C. § 77q(a), provides:
'It shall be unlawful for any person in the offer or sale of any securities by the use of any means or instruments of transportation or communication in interstate commerce or by the use of the mails, directly or indirectly—
'(1) to employ any device, scheme, or artifice to defraud, or
'(2) to obtain money or property by means of any untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or
'(3) to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser.'
52
See Archer v. Securities & Exchange Comm'n, 133 F.2d 795 (C.A.8th Cir.), cert. denied, 319 U.S. 767, 63 S.Ct. 1330, 87 L.Ed. 1717; Charles Hughes & Co. v. Securities & Exchange Comm'n, 139 F.2d 434 (C.A.2d Cir.), cert. denied, 321 U.S. 786, 64 S.Ct. 781, 88 L.Ed. 1077; Hughes v. Securities & Exchange Comm'n, 85 U.S.App.D.C. 56, 174, F.2d 969; Norris & Hirshberg v. Securities & Exchange Comm'n, 85 U.S.App.D.C. 268, 177 F.2d 228; Speed v. Transamerica Corp., 235 F.2d 369 (C.A.3d Cir.).
53
74 Stat. 887, 15 U.S.C. (Supp. IV) § 80b—6(4).
The amendment, as it is relevant here, made it unlawful for an investment adviser:
'(4) to engage in any act, practice, or course of business which is fraudulent, deceptive, or manipulative. The Commission shall, for the purposes of this paragraph (4) by rules and regulations define, and prescribe means reasonably designed to prevent, such acts, practices, and courses of business as are fraudulent, deceptive, or manipulative.'
54
See, e.g., 48 Stat. 895, as amended, 15 U.S.C. § 78o(c)(1), which refers to such devices 'as are manipulative, deceptive, or otherwise fraudulent.' (Emphasis added.)
55
Stonemets v. Head, 248 Mo. 243, 263, 154 S.W. 108, 114. See also note 41, supra.
56
Shulman, Civil Liability and the Securities Act, 43 Yale L.J. 227, 242.
1
According to respondents' brief (and the fact does not appear to be contested), the annual gross income of Capital Gains Research Bureau from publishing investment information and advice was some $570,000. Even accepting the S.E.C.'s figures, respondents' profit from the trading transactions in question was somewhat less than $20,000. Thus any basis for an inference that respondents' advice was tainted by self-interest, which might have been drawn had respondents' buying and selling activities been more significant, is lacking on this record.
2
That section makes it unlawful 'to obtain money or property by means of * * * any omission to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading * * *.'
3
Section 17(a) of the 1933 Act makes it unlawful '(1) to employ any device, scheme, or artifice to defraud * * * (3) to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser.' Compare the language of these provisions with that of § 206(1), (2) of the Investment Advisers Act, supra, p. 203.
4
The argument is that by the time of enactment of the Investment Advisers Act in 1940 Congress had become aware that the courts 'we e merging the proscription against nondisclosure (contained in the 1933 Securities Act) into the general proscription against fraud' also found in the same act. Ante, 198. However, the only federal pre-1940 case cited is Securities & Exchange Comm'n v. Torr, ante, 198, and supra, p. 204. There the failure of a fiduciary to disclose that his advice was prompted by a 'bribe' was equated by the trial judge with deceit. Such a decision can hardly be deemed to establish that any nondisclosure of a fact material to the recipient of investment advice is fraud or deceit. Saying the least, it strains credulity that a provision expressly proscribing material omissions would be thought by Congress to be 'surplusage' when it came to enacting the 1940 Act. This is particularly so when it is remembered that violation of the fraud and deceit section is punishable criminally (§ 217 of the Investment Advisers Act of 1940, 54 Stat. 857); Congress must have known that the courts do not favor expansive constructions of criminal statutes.
| 78
|
375 U.S. 162
84 S.Ct. 295
11 L.Ed.2d 224
UNITED STATES, Petitioner,v.Kenneth Leroy BEHRENS.
No. 86.—October Term, 1963.
Argued Oct. 17, 1963.
Decided Dec. 9, 1963.
Louis F. Claiborne, for petitioner.
Mr. Aribert L. Young, Indianapolis, Ind., for respondent.
Mr. Justice BLACK delivered the opinion of the Court.
1
Respondent was convicted in a United States District Court of an assault with intent to murder, an offense punishable under 18 U.S.C. § 113(a) 'by imprisonment for not more than twenty years.' Desiring more detailed information as a basis for determining the sentence to be imposed, the trial judge decided to proceed 'under the flexible provisions of (s) 4208' of 18 U.S.C. Accordingly, he committed respondent to the custody of the Attorney General to await a study by the Director of the Bureau of Prisons of respondent's previous delinquency, criminal experience, social background, etc. His order provided that after the results of the study and the Director's recommendations were reported to the court, respondent's commitment, deemed to be for 20 years, would 'be subject to modification in accordance with Title 18 U.S.C. 4208(b).'1
2
After the Director's report was received, the trial court entered an order providing 'that the period of imprisonment heretofore imposed be reduced to Five (5) years' and that the Board of Parole might decide when the respondent should be eligible for parole. Neither respondent nor his counsel was present when this modification of the court's previous commitment under § 4208(b) was entered. No direct appeal was taken, but respondent moved to vacate sentence under 28 U.S.C. § 2255. The trial court denied relief, but the Court of Appeals reversed and remanded with directions to vacate the sentence on the ground that it was error for the district judge to impose the final sentence under § 4208(b) in the absence of petitioner and his counsel.2 In another case, Corey v. United States, 307 F.2d 839, the Court of Appeals for the First Circuit held that it was the original commitment under § 4208(b), not the fixing of the final sentence, which marked the point from which time to appeal began running. Because of the disagreement between the two appellate courts' interpretation of § 4208(b) and the general confusion in District Court's and Courts of Appeals as to this section's exact meaning and effect, we granted certiorari in both cases.3
3
In asking that we grant certiorari in the present case, the Solicitor General conceded that if the action of the District Court in fixing the final term of imprisonment under § 4208(b) was a final judgment for the purposes of appeal, then the defendant would plainly be entitled to have himself and his counsel present when the final action was taken. We have decided today, for reasons set out in our opinion in the Corey case, post, p. 169, that the action of a District Court finally determining under § 208(b) the sentence to be imposed upon a defendant is a final, appealable order. For those reasons as well as those set out below, we hold that the District Court erred in the present case when, modifying its original oral § 4208(b) order, it fixed the final sentence in the absence of respondent and his counsel. It is plain that as far as the sentence is concerned the original order entered under § 4208(b) is wholly tentative. That section merely provides that commitment of a defendant to the custody of the Attorney General 'shall be deemed to be for the maximum sentence,' but does not make that the final sentence. The whole point of using § 4208(b) is, in its own language, to get 'more detailed information as a basis for determining the sentence to be imposed * * *.' (Emphasis supplied.) It is only after the Director of the Bureau of Prisons makes his report that the court makes its final decision as to what the sentence will be. Rule 43 of the Federal Rules of Criminal Procedure specifically requires that the defendant be present 'at every stage of the trial including * * * the imposition of sentence * * *.' It is true that the same rule provides that a defendant's presence is not required when his sentence is reduced under Rule 35. But a reduction of sentence under Rule 35 is quite different from the final determination under § 4208(b) of what a sentence is to be. Rule 35 refers to the power of a court to reduce a sentence which has already become final in every respect. There is no such finality of sentence at a § 4208(b) preliminary commitment. The use of § 4208(b) postpones action as to the final sentence; by using that section the court decides to await studies and reports of a defendant's background, mental and physical health, etc., to assist the judge in making up his mind as to what the final sentence shall be. It is only then that the judge's final words are spoken and the defendant's punishment is fixed. It is then that the right of the defendant to be afforded an opportunity to make a statement to the judge in his own behalf is of most importance. This right, ancient in the law, is recognized by Rule 32(a) of the Federal Criminal Rules, which requires the court to 'afford the defendant an opportunity to make a statement in his own behalf and to present any information in mitigation of punishment.' This right would be largely lost in the § 4208 proceeding if for administrative convenience the defendant were not permitted to invoke it when the sentence that counts is pronounced.4 We hold that it was error to impose this sentence in the absence of respondent and his counsel.
4
Affirmed.
5
Mr. Justice HARLAN, concurring in the result.
6
I agree with the result reached in this case, but not with all of the reasoning of my Brother BLACK'S opinion. More particularly, disagreeing as I do with the rationale of the Corey decision, post, p. 169, I draw no support from it for the conclusion here reached.
7
The language of § 4208(b) is not explici on the question whether a defendant must be allowed to be present when the District Court imposes final sentence.1 It is, however, clear that the statute does not contemplate that the district judge will have deliberated and decided upon an appropriate sentence at the time of the original commitment. As the first words of § 4208(b) make plain, the procedures outlined therein are called into play 'if the court desires more detailed information as a basis for determining the sentence to be imposed * * *.' Although the statute refers later to 'the sentence of imprisonment originally imposed,' this is quite plainly intended merely to permit the district judge to impose as a final sentence the 'maximum sentence of imprisonment prescribed by law' under which the defendant is 'deemed to be' committed. The Corey case well illustrates the absurdity of any other conclusion; there the defendant was originally deemed to be committed for a term of 375 years on a conviction of making false claims against the Government. See 375 U.S., p. 171, 84 S.Ct., p. 300.
8
Once it is clear that a defendant is not actually sentenced until after the § 4208(b) inquiry during commitment is completed, the requirements of criminal justice, always subject to this Court's supervisory power over the federal courts, leave no doubt of his right to be present when a final determination of sentence is made. The elementary right of a defendant to be present at the imposition of sentence and to speak in his own behalf, which is embodied in Rule 32(a) of the Federal Rules of Criminal Procedure, is not satisfied by allowing him to be present and speak at a prior stage of the proceedings which results in the deferment of the actual sentence. Even if he has spoken earlier, a defendant has no assurance that when the time comes for final sentence the district judge will remember the defendant's words in his absence and give them due weight. Moreover, only at the final sentencing can the defendant respond to a definitive decision of the judge.
9
Whether or not the Constitution would permit any other procedure it is not now necessary to decide. Congress not having spoken clearly to the contrary,2 I concur in the judgment of the Court.
1
18 U.S.C. § 4208(b) provides:
'If the court desires more detailed information as a basis for determining the sentence to be imposed, the court may commit the defendant to the custody of the Attorney General, which commitment shall be deemed to be for the maximum sentence of imprisonment prescribed by law, for a study as described in subsection (c) hereof. The results of such study, together with any recommendations which the Director of the Bureau of Prisons believes would be helpful in determining the disposition of the case, shall be furnished to the court within three months unless the court grants time, not to exceed an additional three months, for further study. After receiving such reports and recommendations, the court may in its discretion: (1) Place the prisoner on probation as authorized by section 3651 of this title, or (2) affirm the sentence of imprisonment orginally imposed, or reduce the sentence of imprisonment, and commit the offender under any applicable provision of law. The term of the sentence shall run from date of original commitment under this section.'
2
7 Cir., 312 F.2d 223.
3
371 U.S. 966, 83 S.Ct. 550, 9 L.Ed.2d 537; 373 U.S. 902, 83 S.Ct. 1290, 10 L.Ed.2d 198.
4
It is true that the House Committee on the Judiciary in reporting favorably on a proposed section identical to § 4208(b) indicated that it saw no necessity for a defendant being present when final action on his sentence was taken. H.R.R.ep. No. 1946, 85th Cong., 2d Sess., p. 10. This section failed of passage in the House but an identical one was added by the Senate and adopted without discussion of the point in the Senate committee and conference reports. See S.Rep. No. 2013, 85th Cong., 2d Sess.; H.R.Rep. No. 2579, 85th Cong., 2d Sess., U.S.Code Congressional and Administrative News, 1958, p. 3891. No language supporting this position appeared in the Senate bill or in the Act itself. We are not inclined to expand the language of the section, and thereby make necessary a constitutional decision, by reading the silence of the Act as depriving a defendant of a right to urge upon the court reasons for leniency at the time when the judge at last has the relevant materials for decision before him.
1
Section 4208(b) provides:
'If the court desires more detailed information as a basis for determining the sentence to be imposed, the court may commit the defendant to the custody of the Attorney General, which commitment shall be deemed to be for the maximum sentence of imprisonment prescribed by law, for a study as described in subsection (c) hereof. The results of such study, together with any recommendations which the Director of the Bureau of Prisons believes would be helpful in determining the disposition of the case, shall be furnished to the court within three months unless the court grants time, not to exceed an additional three months, for further study. After receiving such reports and recommendations, the court may in its discretion: (1) Place the prisoner on probation as authorized by section 3651 of this title, or (2) affirm the sentence of imprisonment originally imposed, or reduce the sentence of imprisonment, and commit the offender under any applicable provision of law. The term of the sentence shall run from date of original commitment under this section.'
2
A bill now pending in Congress provides that the defendant's presence is not required at final sentencing but the defendant may be present in the discretion of the court. S.1956, 88th Cong., 1st Sess.
Neither the legislative history set out in the opinion of the majority, ante, p. 166, note 4, nor the pending proposal seems to me sufficient indication of congressional intent to require disregard of the important right involved in this case, particularly in light of the possible constitutional issues which would be raised.
| 01
|
375 U.S. 169
84 S.Ct. 298
11 L.Ed.2d 229
Benjamin W. COREY, Petitioner,v.UNITED STATES.
No. 31.
Argued Oct. 17, 1963.
Decided Dec. 9, 1963.
Russell Morton Brown, Washington, D.C., for petitioner.
Louis F. Claiborne, Asst. Sol. Gen. of United States, for respondent.
Mr. Justice STEWART delivered the opinion of the Court.
1
The petitioner was convicted by a jury in the United States District Court in Massachusetts upon a 75-count indictment for making false claims against the Government in violation of 18 U.S.C. § 287. The trial judge, after preliminary sentencing hearings, came to the conclusion that it would be helpful 'for the Court to know something more about the defendant than I have seen or heard up to date.' Accordingly, the court entered an order committing the petitioner 'to the custody of the Attorney General of the United States under Title 18, United States Code, 4208(b).'1 More than three months later, after considering the report which the Bureau of Prisons had submitted in accordance with § 4208(b), the trial judge, in a proceeding at which the petitioner and his counsel were present, entered an order suspending imposition of sentence and placing the petitioner on rpobation for two years. Three days later the petitioner filed a notice of appeal.
2
Upon motion of the Government the appeal was dismissed as untimely, on the ground that the period for appeal had expired 10 days after entry of the trial court's initial order committing the petitioner for study under 18 U.S.C. § 4208(b). Pointing out that § 4208(b) provides that such a commitment 'shall be deemed to be for the maximum sentence of imprisonment prescribed by law,'2 the Court of Appeals reasoned that 'at this point the defendant was on notice as to the extent of his punishment. If he desired to appeal, this was the time that he should have acted.'3 307 F.2d 839, 840. We granted certiorari, 371 U.S. 966, 83 S.Ct. 550, 9 L.Ed.2d 537, to consider questions which have arisen in the District Courts and Courts of Appeals in the application of 18 U.S.C. § 4208(b).4
3
The procedural rules governing the usual course of criminal appeals in the federal judicial system are well settled. After a plea or finding of guilty, sentence is to be imposed 'without unreasonable delay.'5 A judgment of conviction setting forth the sentence is then entered,6 and a notice of appeal must be filed within 10 days thereafter.7 The record is filed with the Court of Appeals and the appeal docketed within 40 days thereafter,8 and the appeal is heard 'as soon * * * as the state of the calendar will permit.'9 Pending disposition of the appeal, the sentence is stayed unless the defendant elects otherwise,10 and the defendant may be released on bail.11
4
The dominant philosophy embodied in these rules reflects the twin concerns that criminal appeals be disposed of as expeditiously as the fair and orderly administration of justice may permit, and that the imposition of actual punishment be avoided pending disposition of an appeal. In the ordinary criminal case, where the imposition of a sentence follows promptly upon a determination of guilt, no problem arises in the application of these appellate rules or in the effectuation of the policies which they reflect. An appeal may not be taken until after the pronouncement of sentence, and must be taken promptly after sentence is imposed.
5
But under the provisions of 18 U.S.C. § 4208(b) the trial judge sentences a convicted defendant not once, but twice. The judge first imposes a sentence of imprisonment 'deemed to be' the maximum prescribed by the law, and then, after the defendant has been imprisoned for three or six months, the judge fixes a new sentence which may be quite different from the one originally imposed. The present case illustrates the problem which then arises. That problem, simply stated, is how, in cases where trial judges have utilized the sentencing provisions authorized by 18 U.S.C. § 4208(b), the rules governing criminal appeals are to be applied so as neither to frustrate their purpose nor to impair the efficacy of the flexible sentencing procedure which Congress devised in enacting 18 U.S.C. § 4208(b).12 We have concluded that in such cases an appeal may be taken within the time provided by Rule 37(a)(2), Fed.Rules Crim.Proc., after either the first or the second sentence under § 4208(b), at the option of the convicted defendant.
6
It would obviously contravene the basic policies of the criminal appellate rules to require a defendant sentenced under § 4208(b) to defer his appeal until after he had submitted to the three or six months of incarceration and diagnostic study prescribed by the statute. Such a requirement would not only forestall any opportunity of a prompt appeal from an underlying criminal conviction, but would deprive a convicted defendant of the substantial right to be enlarged on bail while his appeal was pending. Indeed, the imposition of such a mandatory three- or six-month term of imprisonment before the defendant could file an appeal might raise constitutional problems of significant proportions.
7
But we need not consider such problems, because a § 4208(b) commitment is clearly not lacking in sufficient 'finality' to support an immediate appeal, and there is nothing to indicate that Congress intended that the right of appeal be mandatorily suspended in cases where the provisions of § 4208(b) are utilized. The provisions of § 4208(b) are invoked only after 'a judgment of conviction.'13 The defendant is committed under § 4208(b) 'to the custody of the Attorney General' as in the case of all sentenced prisoners.14 It is provided that the term of the final sentence 'shall run from date of original commitment under this section.'
8
A sentence under these provisions, which is imposed only after the whole process of the criminal trial and determination of guilt has been completed, sufficiently satisfies conventional requirements of finality for purposes of appeal. The litigation is complete as to the fundamental matter at issue—'the right to convict the accused of the crime charged in the indictment.' Heike v. United States, 217 U.S. 423, 429, 30 S.Ct. 539, 541, 54 L.Ed. 821. 'Final judgment in a criminal case,' the Court has said, 'means sentence. The sentence is the judgment.' Berman v. United States, 302 U.S. 211, 212, 58 S.Ct. 164, 165—166, 82 L.Ed. 204. This concept was later explained and amplified in words of complete applicability here: 'The 'sentence is the judgment' phrase has been used by this Court in dealing with cases in which the action of the trial court did not in fact subject the defendant to any form of judicial control. * * * But certainly when discipline has been imposed, the defendant is entitled to review.' Korematsu v. United States, 319 U.S. 432, 434, 63 S.Ct. 1124, 87 L.Ed. 1435.
9
For these reasons it is clear to us that the petitioner in the present case could have appealed his conviction within 10 days after the entry of the original commitment order under § 4208(b). Had he done so, the Court of Appeals could have reviewed all claims of error in the trial proceedings, and its determination would have been final,15 subject only to discretionary review by this Court.
10
It does not follow, however, simply because a defendant could have sought review of his conviction afte the initial commitment under § 4208(b), that Congress intended to deny altogether the right of appeal to a defendant who chose to adopt the course followed by the petitioner in the present case. While an initial commitment under § 4208(b) is, as we have pointed out, freighted with sufficiently substantial indicia of finality to support an appeal, the fact remains that the proceedings in the trial court are not actually terminated until after the period of diagnostic study, review of the same by the district judge, and final sentence. Cf. Behrens v. United States, ante, p. 295. There might be many reasons why a convicted defendant or his counsel would prefer to await final termination of the trial court proceedings before taking an appeal. For instance, a defendant might think, rightly or wrongly, that the trial court's knowledge that an appeal had already been taken might adversely influence the court's discretion in imposing final sentence. Moreover, if every defendant initially committed under § 4208(b) to the maximum prison term prescribed by law were faced with the choice of then and there seeking review of his conviction or forever losing the right of appeal, he might well feel obliged to take an appeal because of his very ignorance of what his sentence was eventually going to turn out to be. As a practical matter, the severity of the sentence actually imposed might in any case be a major factor in determining whether an appeal is to be taken.
11
Long-accepted and conventional principles of federal appellate procedure require recognition of the defendant's right to await the imposition of final sentence before seeking review of the conviction. That is the general rule. Miller v. Aderhold, 288 U.S. 206, 53 S.Ct. 325, 77 L.Ed. 702; Berman v. United States, 302 U.S. 211, 58 S.Ct. 164, 82 L.Ed. 204; Cobbledick v. United States, 309 U.S. 323, 60 S.Ct. 540, 84 L.Ed. 783; Rule 37(a), Fed.Rules Crim.Proc. We find nothing to indicate that Congress intended to depart from that rule in enacting § 4208(b).
12
Reversed.
13
Mr. Justice HARLAN, dissenting.
14
While I agree with the majority that a criminal defendant who has been committed to the custody of the Attorney General under 18 U.S.C. § 4208(b) has the right to prosecute an immediate appeal from the judgment of conviction, I am unable to accept the view, so contrary to long-accepted principles governing the time for seeking review, that he has also the alternative right to await final sentencing and then prosecute an appeal from the judgment of conviction. Accordingly, I would hold that the petitioner's attempted appeal at that stage of the proceedings was untimely.
15
It is clear that a § 4208(b) commitment, which is necessarily preceded by a judgment of conviction, see 18 U.S.C. § 4208(a), fully satisfies the requirement of finality under 28 U.S.C. § 1291. At that point in the proceedings, the merits have been fully litigated, the defendant has been adjudged guilty, and 'discipline has been imposed,' Korematsu v. United States, 319 U.S. 432, 434, 63 S.Ct. 1124, 1125—1126, 87 L.Ed. 1435. In that case this Court held that after a finding of guilt an order placing the defendant on probation was a final appealable order. In the absence of an explicit statement of contrary congressional intent,1 Korematsu controls this case, in which the disciplinary measure taken was an actual commitment to prison. The liberalization of sentencing procedures under § 4208(b) does not require or even suggest that a defendant be deprived of his right speedily to test the validity of his conviction.
16
It is otherwise, however, with respect to an appeal following the imposition of final sentence in accordance with § 4208(b). Of course it is true, as the majority points out, that the general rule is that the defendant may 'await the imposition of final sentence before seeking review of the conviction,' ante, p. 176. Indeed, the g neral rule is that he has no choice but to wait. The majority and I agree, for the reasons stated, that the separation of final judgment and final sentence under § 4208(b) makes the rule inapplicable in this situation. Nevertheless, after having discarded the rule for one-half of its opinion, the majority relies on it as a justification for allowing the defendant the alternative of postponing his appeal until long after the final judgment of conviction has been rendered. This is explained only by a distinction, novel in this context, between final judgments and proceedings 'not actually terminated,' ante, p. 175. Congress could, of course, arm defendants committed under § 4208(b) with this double-barreled shotgun. But there is nothing to indicate that it has done so.2 In the absence of any such indications, so radical a departure from long-established procedural principles should be made, in what is presumably an exercise of this Court's supervisory power over the administration of federal criminal justice, only where fairness imperatively so demands.
17
The majority finds such necessity in a defendant's possible preference to await final sentencing before deciding whether or not to appeal. A defendant, it is suggested, might fear that his taking of an appeal would have an adverse impact on the sentencing judge; or he might be disinclined to appeal if he is ultimately to receive a light sentence. Neither of these possibilities warrants the majority's innovation in review procedures. It should be a simple matter for a defendant who prefers to await the outcome of the § 4208(b) proceeding before prosecuting his appeal to file a notice of appeal within the prescribed time after the original commitment and then secure a continuance pending final sentencing in the District Court.3 I see no reason why a Court of Appeals should be reluctant to grant a continuance in these circumstances; were this not the case, such a requirement could be imposed by this Court in the exercise of its supervisory powers. That a defendant might believe, surely in all but the rare instance incorrectly, that the mere filing of a notice of appeal would weigh against him with the sentencing judge is hardly a persuasive consideration; with as much reason, he might believe that it would have the effect of stimulating the sentencing judge to reduce his sentence. In any event, it is surely inappropriate to structure review procedures around hypothetical beliefs of defendants in the maladministration of criminal justice.
18
New procedures designed to better the administration of criminal j stice, such as § 4208(b), should not without manifest need be the occasion for radical departures from established theory and practice. Seeing no need for such a departure in this case, I respectfully dissent and would affirm the judgment below.
1
18 U.S.C. § 4208(b) provides:
'If the court desires more detailed information as a basis for determining the sentence to be imposed, the court may commit the defendant to the custody of the Attorney General, which commitment shall be deemed to be for the maximum sentence of imprisonment prescribed by law, for a study as described in subsection (c) hereof. The results of such study, together with any recommendations which the Director of the Bureau of Prisons believes would be helpful in determining the disposition of the case, shall be furnished to the court within three months unless the court grants time, not to exceed an additional three months, for further study. After receiving such reports and recommendations, the court may in its discretion: (1) Place the prisoner on probation as authorized by section 3651 of this title, or (2) affirm the sentence of imprisonment originally imposed, or reduce the sentence of imprisonment, and commit the offender under any applicable provision of law. The term of the sentence shall run from date of original commitment under this section.'
2
See note 1, supra.
3
Since the petitioner was convicted upon each of 75 counts under 18 U.S.C. § 287, and since each offense under that statute is punishable by a prison term of up to five years, 'the extent of his punishment,' if it was the 'maximum sentence of imprisonment prescribed by law,' was 375 years in prison. Such a sentence, if actually imposed for the substantive offenses in question, would obviously raise a serious issue under the Eighth Amendment of the Constitution.
4
In Behrens v. United States, 312 F.2d 223 (1962), certiorari granted, 373 U.S. 902, 83 S.Ct. 1290, 10 L.Ed.2d 198, the Court of Appeals for the Seventh Circuit, holding that the defendant and his counsel must be present when sentence is imposed following receipt of the Bureau of Prisons report, apparently considered that proceeding—rather than the earlier commitment order—as the one from which th time for appeal would begin to run. On the question of the right of the defendant and his counsel to then be present, we have today affirmed that decision. United States v. Behrens, ante, p. 295. See also United States v. Johnson, 315 F.2d 714 (C.A.2d Cir. 1963).
5
Rule 32(a), Fed.Rules Crim.Proc.
6
Rule 32(b), Fed.Rules Crim.Proc.
7
Rule 37(a)(2), Fed.Rules Crim.Proc.
8
Rule 39(c), Fed.Rules Crim.Proc.
9
Rule 39(d), Fed.Rules Crim.Proc.
10
Rule 38(a)(2), Fed.Rules Crim.Proc.
11
Rule 46(a)(2), Fed.Rules Crim.Proc.
12
Section 4208(b) was enacted in 1958 as part of broad legislation to improve sentencing practices in the federal courts. See 28 U.S.C. § 334 (providing for judicial sentencing institutes to be held in the various circuits); 18 U.S.C. § 4209 (extending the application of the Federal Youth Corrections Act to offenders between 22 and 26); 18 U.S.C. § 4208(a) (authorizing a sentencing judge to delegate wide discretion to the Parole Board).
13
18 U.S.C. § 4208(a) begins: 'Upon entering a judgment of conviction, the court having jurisdiction to impose sentence, when in its opinion the ends of justice and best interests of the public require that the defendant be sentenced to imprisonment for a term exceeding one year, may * * *.' While these words are not repeated in subsection (b), it is plain that they serve as an introduction to all of § 4208.
14
See 18 U.S.C. § 4082.
15
Only the final sentence which was later imposed would still have been open, under accepted procedures, to attack in the trial court and review on appeal, e.g., for failure to accord the defendant and his counsel the right to be present and to be heard at the final sentencing proceeding. See Behrens v. United States, ante, p. 295.
If a defendant appeals after a preliminary commitment under § 4208(b) and is enlarged on bail pending appeal, the further procedures under § 4208(b) (including the pronouncement of final sentence) will necessarily be postponed until the appeal is determined (and eliminated entirely if the conviction is reversed), because the diagnostic study by the Bureau of Prisons cannot be carried out if the defendant is not incarcerated. On the other hand, if a defendant taking an appeal after an initial commitment under § 4208(b) does not seek bail but elects to commence service of his sentence, there is templated by the statute should not prono reason why the diagnostic study conceed. Modifications of sentences have in fact been made under § 4208(b) while cases were on appeal. See Armstrong v. United States, 306 F.2d 520, 521, n. 1 (C.A.10th Cir. 1962); United States v. Varner, 283 F.2d 900, 901 (C.A.7th Cir. 1961).
1
I intimate no view as to whether such a statute would infringe constitutional rights.
2
There is now pending in Congress a bill to amend § 4208 which provides that 'the right to appeal shall run from the date the original sentence was imposed under subsection (b) of this section.' S.1956, 88th Cong., 1st Sess.
3
I agree with the majority that if a defendant elects to commence service of sentence, the filing of a notice of appeal in the Court of Appeals would not prevent the § 4208(b) proceedings from going forward in the District Court. Cases like Berman v. United States, 302 U.S. 211, 58 S.Ct. 164, 82 L.Ed. 204, and United States v. Smith, 331 U.S. 469, 67 S.Ct. 1330, 91 L.Ed. 1610, involved different problems and are not relevant in the present context. Final § 4208(b) sentences have in fact been imposed in the District Court while an appeal was pending. See cases cited in the majority's opinion, ante, p. 175, note 15.
The requirement of Rule 39(d), Federal Rules of Criminal Procedure, that an appeal be set for argument 'not less than 30 days after the filing * * * of the record on appeal and as soon after the expiration of that period as the state of the calendar will permit' would obviously not prevent a continuance in these circumstances.
Of course, if a defendant chooses to be released on bail pending appeal, the proceedings under § 4208(b) would then be postponed until remand of the case to the District Court following appellate affirmance of the conviction.
| 01
|
375 U.S. 208
84 S.Ct. 291
11 L.Ed.2d 256
Claude DENNIS, Petitioner,v.The DENVER & RIO GRANDE WESTERN RAILROAD CO.
No. 25.
Argued Nov. 19, 1963.
Decided Dec. 9, 1963.
Wayne L. Black, Salt Lake City, Utah, for petitioner.
Clifford L. Ashton, Salt Lake City, Utah, for respondent.
PER CURIAM.
1
Petitioner, a section laborer employed by respondent railroad, brought this suit under the Federal Employers' Liability Act, 35 Stat. 65, as amended, 45 U.S.C. § 51 et seq., in a Utah State Court to recover damages for personal injury sustained as a result of respondent's alleged negligence. The jury, finding respondent negligent and petitioner contributorily negligent, assessed 'general damages' at $20,000 and deducted $10,000 'by reason of contributory negligence,' leaving a verdict of $10,000 for petitioner. The Supreme Court of Utah vacated the jury verdict and ordered the entry of judgment for respondent. 13 Utah 2d 249, 372 P.2d 3. We granted certiorari, 371 U.S. 946, 83 S.Ct. 501, 9 L.Ed.2d 496, to consider whether the Supreme Court of Utah erred in its action.
2
From the evidence adduced at trial the jury could have concluded that: Petitioner was required to work from about 5 p.m. to about 5 a.m. in temperatures ranging from 10 Fahrenheit to minus 5 Fahrenheit, in 10 inches of snow, with 'the wind a-blowing pretty hard,' to repair a damaged section of railroad track; petitioner was dressed less warmly than the other members of the crew, and the foreman knew this; the only source of heat (outside of the cab of the truck which had transported the crew to the worksite) was a fire built from a single railroad tie, which did not give 'very much' heat; at about midnight, petitioner, while handling a cold wrench, noticed that 'two (of his) fingers were clamped shut and (he) had to pull them apart * * * before (he) could get (his) glove off'; he also noticed a 'kind of burning, tingling sensation' in these fingers; although he communicated some or all of this to the foreman, petitioner was permitted to continue working on the track for about three and one-half hours; he spent only about one-half hour in the heated cab of the truck; as a r sult of this exposure, petitioner suffered frostbite and lost two fingers.
3
There can be little dispute that these facts, if believed, establish negligence by respondent railroad, since they show that the foreman, who had full control over petitioner's activities while on this job, did not take all necessary and reasonable precautions to prevent injury to petitioner when put on notice of his condition. Lavender v. Kurn, 327 U.S. 645, 66 S.Ct. 740, 90 L.Ed. 916; Boston & M.R. Co. v. Meech, 1 Cir., 156 F.2d 109, cert. denied, 329 U.S. 763, 67 S.Ct. 124, 91 L.Ed. 658.
4
It is true that there was evidence in conflict with petitioner's version of what occurred. For example, other members of the work crew testified that immediately after his complaint petitioner was transferred to the heated cab where he stayed until the end of the job, whereas petitioner testified that after his complaint he spent only one-half hour in the heated cab and three and one-half hours working outside. There was also evidence from which the jury could reasonably have concluded that petitioner's own negligence was the sole cause of his injury. But in FELA cases this Court has repeatedly held that where 'there is an evidentiary basis for the jury's verdict, the jury is free to discard or disbelieve whatever facts are inconsistent with its conclusion.' Lavender v. Kurn, supra, 327 U.S., at 653, 66 S.Ct., at 744, 90 L.Ed. 916. 'Only when there is a complete absence of probative facts to support the conclusion reached (by the jury) does a reversible error appear.' Ibid. Once it is shown that 'employer negligence played any part, even the slightest, in producing the injury,' Rogers v. Missouri Pac. R. Co., 352 U.S. 500, 506, 77 S.Ct. 443, 448, 1 L.Ed.2d 493, a jury verdict for the employee may not be upset on the basis of his own negligence, no matter how substantial it may have been, although the jury may, of course, take petitioner's contributory negligence into account, as it did here, in arriving at the final verdict.
5
In this case, petitioner's evidence, though vigorously disputed, was sufficient to support the jury's conclusion that respondent's negligence contributed to the injury. Hence, 'the appellate court's function (was) exhausted,' Lavender v. Kurn, supra, 327 U.S., at 653, 66 S.Ct., at 744, 90 L.Ed. 916, and it could not properly substitute its judgment for that of the jury and decide, as the Supreme Court of Utah did here, that 'it seems quite inescapable that it was (petitioner's) own conduct * * * that resulted in this regrettable injury.' 13 Utah 2d, at 255, 372 P.2d, at 7.
6
The judgment of the Supreme Court of Utah is reversed and the cause is remanded for further proceedings not inconsistent with this opinion. It is so ordered.
7
Reversed and remanded.
8
Mr. Justice DOUGLAS, with whom Mr. Justice HARLAN concurs, dissenting.
9
The cases cited by the Court to reverse the Utah Supreme Court are familiar ones that involve the duty of an employer to provide the employee with a safe place to work. Lavender v. Kurn, 327 U.S. 645, 651—653, 66 S.Ct. 740, 743—744, 90 L.Ed. 916; Boston & M.R. Co. v. Meech, 1 Cir., 156 F.2d 109, 111—112. That issue was covered by the instructions to the jury in the present case.* But as I read the record there is no evidence of negligence on the issue of 'a reasonably safe place in which to work.' In this case each workman furnished his own clothes. If it were the custom of the railroad to furnish gloves or other clothes to the employees or if, under a collective bargaining agreement, it had become its duty to do so and petitioner had been issued faulty garments, we would have a different case. We would also have a different case if failure to furnish an employee with certain kinds of equipment were tantamount to a failure to provide him a safe place to work. See, e.g., Williams v. Atlantic Coast Line R. Co., 5 Cir., 190 F.2d 744; Young v. Clinchfield R. Co., 4 Cir., 288 F.2d 499; Ferrara v. Boston & M.R. Co., 338 M ss. 323, 155 N.E.2d 416. But no such issue is tendered here.
10
The weather was bitter, and the emergency job of repairing a section of a damaged rail could only be done outdoors. But there was a heated truck cab for protection against the weather and outdoors there was a fire. There is nothing to suggest that petitioner was barred from using either, that pressures were put on him to remain outdoors and away from the fire or the heated cab, or that disciplinary measures would be used against those who took frequent recesses to keep warm. Rather, it was admitted that the men generally took turns using the fire and that each was the best judge of when he should warm himself.
11
Knowledge of the foreman that petitioner was dressed less warmly than the other crew members would be relevant if it were coupled with the foreman's insistence that he perform labor for which his attire was not suitable. That, too, is a different case. The strongest possible case for petitioner, as the Court says, is that he was 'permitted' to continue working after his fingers, with the knowledge of the foreman, became very cold. But unless employers are to become insurers of these industrial accidents, that is no evidence of negligence in a society where everyone is presumed to have enough sense 'to some in out of the rain.'
12
Mr. Justice HARLAN, dissenting.
13
I do not believe this case should have been taken for review and I now dissent from the reversal of the judgment of the Utah Supreme Court, for reasons already expressed in past cases of this type. See Rogers v. Missouri Pac. R. Co., 352 U.S. 500, 559, 77 S.Ct. 443, 459, 1 L.Ed.2d 493; Webb v. Illinois Central R. Co., 352 U.S. 512, 559, 77 S.Ct. 451, 459, 1 L.Ed.2d 503; Ferguson v. Moore-McCormack Lines, Inc., 352 U.S. 521, 559, 77 S.Ct. 457, 459, 1 L.Ed.2d 511, 515; Arnold v. Panhandle & S.F.R. Co., 353 U.S. 360, 361, 77 S.Ct. 840, 841, 1 L.Ed.2d 889; Harris v. Pennsylvania R. Co., 361 U.S. 15, 25, 80 S.Ct. 22, 28, 4 L.Ed.2d 1; Davis v. Virginian R. Co., 361 U.S. 354, 358, 80 S.Ct. 387, 289, 4 L.Ed.2d 366; Michalic v. Cleveland Tankers, Inc., 364 U.S. 325, 332, 81 S.Ct. 6, 11, 12, 5 L.Ed.2d 20; Gallick v. Baltimore & Ohio R. Co., 372 U.S. 108, 122, 83 S.Ct. 659, 668, 9 L.Ed.2d 618; Basham v. Pennsylvania R. Co., 372 U.S. 699, 701, 83 S.Ct. 965, 967, 10 L.Ed.2d 80.
14
In this instance we are not even precisely informed by the Court's opinion wherein the respondent's conduct was negligent. The means for requiting unfortunate industrial accidents of this sort should be found not in destroying the supervisory power of the courts over jury verdicts unsupported by evidence of employer fault, but in legislative expansion of the concepts of workmen's compensation laws, under which compensation is not dependent upon a showing of employer negligence. Cf. Gallick v. Baltimore & Ohio R. Co., supra.
*
'It is the duty of a railroad company to exercise reasonable care in furnishing its employees with a reasonably safe place in which to work. The duty does not require the absolute elimination of all danger, but it does require the elimination of all dangers which the exercise of reasonable care would remove or guard against.
'In this connection, you are instructed that if you find from a preponderance of the evidence, that the railroad company failed to exercise reasonable care in that it subjected plaintiff to unreasonable exposure to harm from weather conditions, then you are instructed that defendant was negligent in failing to discharge its duty as hereinabove set forth; and if you further find that such negligence, if any, in whole or in part, proximately caused plaintiff to sustain injuries, then you should return a verdict in favor of the plaintiff and against defendant and assess damages in accordance with these instructions'.
| 78
|
375 U.S. 249
84 S.Ct. 305
11 L.Ed.2d 304
Marguerite Loretta ALDRICH, Petitioner,v.William T. ALDRICH et al.
No. 55.
Supreme Court of the United States
December 16, 1963
Herman D. Rollins, for petitioner.
Charles M. Love, for respondents.
PER CURIAM.
1
This Court, on its own motion, hereby certifies to the Supreme Court of Florida, pursuant to Rule 4.61, Florida Appellate Rules, 31 F.S.A., the questions of law hereinafter set forth.
2
STATEMENT OF FACTS.
3
Petitioner, The jurisdiction of that court to award the divorce was not contested then, nor is it contested in this action.
4
The divorce decree awarded alimony to the plaintiff, in the following provision:
5
'4. That the defendant, Moriel Simeon Aldrich, be and he is hereby ordered and required to pay to the plaintiff. Marguerite Loretta Aldrich, the monthly sum of $250.00 as and for her permanent alimony, said sum to be paid to her monthly at the office of the Clerk of the Circuit Court of Miami, Dade County, Florida, and in the event the defendant, Moriel Simeon Aldrich, shall predecease the plaintiff, Marguerite Loretta Aldrich, said monthly sum of $250.00 shall, upon the death of said defendant, become a charge upon his estate during her lifetime; and this Court retains jurisdiction in respect thereto * * *.'
6
There was no prior express agreement between the parties that the estate would be bound. Subsequently, the divorce defendant petitioned the Florida court for a rehearing, which was denied, but the court reduced alimony from $250 to $215 per month. No appeal was taken by either party.
7
M. S. Aldrich died testate, a resident of Putnam County, West Virginia, on May 29, 1958. His will was duly probated in Putnam County and petitioner filed a claim against the estate for alimony which accrued after the death of M. S. Aldrich. The appraisal of the estate showed assets of $7,283.50. Petitioner commenced this action in the Circuit Court of Putnam County, West Virginia, in order to have her rights in the estate determined. She also demanded that certain allegedly fraudulent transfers of real and personal property made by M. S. Aldrich be set aside and the properties which were the subject of such transfers administered as a part of the estate, so as to be subject to her claim for alimony under the Florida divorce decree.
8
The defendants are identified as follows: William T. Aldrich is a son of M. S. Aldrich and petitioner, and Natalie Aldrich is the wife of William T. Aldrich. Angela Aldrich is the widow of M. S. Aldrich. M. S. Aldrich & Associates, Inc., is a corporation which petitioner alleges was principally, if not solely, owned by M. S. Aldrich during his lifetime or until shortly before his death. Aldrich-Slicer Company is a corporation, one of the organizers of which was William T. Aldrich. John C. White is executor of the last will and testament of M. S. Aldrich.
9
On motion for summary judgment by the defendants, the Circuit Court of Putnam County held that the decree of the Florida divorce court was invalid and unenforceable insofar as it purported to impose upon the estate of M. S. Aldrich an obligation to pay alimony accruing after his death. On appeal, the Supreme Court of Appeals of West Virginia affirmed the decision of the lower court, one judge dissenting. The majority and minority opinions of the West Virginia court are reported in Aldrich v. Aldrich, 147 W.Va. 269, 127 S.E.2d 385. Review by this Court was sought and obtained on the basis of Art. IV, § 1, of the Constitution of the United States, which provides that 'Full Faith and Credit shall be given in each State to the public Acts, Records, and judicial Proceedings of every other State.' The case was heard on October 24, 1963, and on November 12, 1963, the Court issued a per curiam opinion, 375 U.S. 75, 84 S.Ct. 184, pursuant to which the following questions are certified to the Supreme Court of Florida:
10
1. Is a decree of alimony that purports to bind the estate of a deceased husband permissible, in the absence of an express prior agreement between the two spouses authorizing or contemplating such a decree?
11
2. If such a decree is not permissible, does the error of the court entering it render that court without subject matter jurisdiction with regard to that aspect of the cause? 3. If subject matter jurisdiction is thus lacking, may that defect be challenged in Florida, after the time for appellate review has expired, (i) by the representatives of the estate of the deceased husband or (ii) by persons to whom the deceased husband has allegedly transferred part of his property without consideration?
12
4. If the decree is impermissible but not subject to such attack in Florida for lack of subject matter jurisdiction by those mentioned in subparagraph 3, may an attack be successfully based on this error of law in the rendition of the decree?
| 89
|
375 U.S. 233
84 S.Ct. 318.
11 L.Ed.2d 293
Ethel MEYER, Petitioner,v.UNITED STATES.
No. 61.
Argued Oct. 24, 1963.
Decided Dec. 16, 1963.
Samuel W. Sherman, New York City, for petitioner.
Joseph Kovner, Washington, D.C., for respondent.
Mr. Justice CLARK delivered the opinion of the Court.
1
The ultimate issue in this case is the applicability of the doctrine of marshaling of assets. The Government urges that it be applied to effect the collection of its junior income tax lien on the cash surrender value of certain life insurance policies. The senior lien is secured by the entire proceeds of the policies and absorbs practically all of their cash surrender value. The proceeds of the policies are exempt from levy by creditors of the insured under state law.
2
In 1943 the deceased, Peter Meyer, pledged his insurance policies to a bank as collateral security for a loan, giving the bank the right to satisfy its claim out of the 'net proceeds of the policy when it becomes a claim by death.' When Mr. Meyer died, the insurance company paid the amount of the loan to the bank and the balance to the petitioner, Mr. Meyer's widow and beneficiary. The Commissioner claims, however, that the insurance proceeds must be marshaled, that the Government's admittedly junior tax lien must be paid from the cash surrender value of the policies and the bank from the remaining proceeds. The District Court agreed, 202 F.Supp. 606, and the Court of Appeals affirmed, 2 Cir., 309 F.2d 131. We granted certiorari because of the importance of the question in the administration of the income tax laws. 372 U.S. 934, 83 S.Ct. 882, 9 L.Ed.2d 765. We disagree with both courts and reverse the judgment.
I.
3
Peter Meyer owned four life insurance policies which named the petitioner, his wife, as beneficiary. Their face amount was $50,000 and their cash surrender value at his death was $27,285.87. He had retained the usual powers under such policies, namely, to change the beneficiaries, demand the cash surrender value and assign the policies. In 1943, long before the tax assessments in this suit, he assigned the policies as collateral security for the repayment of a loan from the Huntington National Bank of Columbus, Ohio. The bank was given the right, in the event of death, to satisfy its claim out of the 'net proceeds of the policy when it becomes a claim by death.' At the time of Meyer's death, $26,844.66 was due on this loan.
4
It is not disputed that the Commissioner assessed deficiencies covering income taxes due by Mr. Meyer for the years 1945 and 1946, with a balance of $6,159.09 plus interest due at his death, and that notice of lien was filed in 1955. Meyer died on December 28, 1955, and petitioner was named executrix of his estate. After the insurance company paid the full amount of the loan to the bank and the balance remaining due on the policies to the petitioner, this suit was begun against petitioner, individually and as executrix, for the recovery of the full amount of the taxes due. Petitioner tendered the sum of $441.21, the difference between the cash surrender value and the mount paid to the bank, but claimed the remainder as exempt under New York Insurance Law, McKinney's Consol.Laws, c. 28, § 166.* The District Court, however, granted summary judgment for the Government on the theory that the tax lien could be satisfied out of that portion of the proceeds that represented the cash surrender value by marshaling the funds and paying the bank's claim from the remainder of the proceeds. It followed the holding of the Second Circuit in United States v. Behrens, 230 F.2d 504. The Court of Appeals affirmed on the same basis. We cannot agree.
II.
5
This Court has held and the parties do not dispute that: absent a lien, recovery of unpaid federal income taxes from a beneficiary of insurance can be had only to the extent that applicable state law permits such recovery by other creditors of the insured, Commissioner v. Stern, 357 U.S. 39, 46—47, 78 S.Ct. 1047, 1051—1052, 2 L.Ed.2d 1126 (1958); the insured taxpayer's 'property and rights to property' under § 3670 of the Internal Revenue Code of 1939 are measured by the policy contract as enforced by applicable state law, United States v. Bess, 357 U.S. 51, 55—56, 78 S.Ct. 1054, 1057—1058, 2 L.Ed.2d 1135 (1958); the cash surrender value of an insurance policy, where subject to the control of the insured, is 'property and rights to property' under the section, id., 357 U.S. at 59, 78 S.Ct. at 1059; finally, the priority of liens is determined by the principle 'first in time, first in right,' United States v. New Britain, 347 U.S. 81, 74 S.Ct. 367, 98 L.Ed. 520 (1954). Applying New York law, this results in the bank's lien being the senior one on the entire proceeds of the policies with the tax lien only attaching to the cash surrender value subject to the bank's claim. The narrow question remaining is whether in such a situation the doctrine of marshaling of assets is compelled.
III.
6
This Court has said that '(t)he equitable doctrine of marshaling (sic) rests upon the principle that a creditor having two funds to satisfy his debt may not, by his application of them to his demand, defeat another creditor, who may resort to only one of the funds.' Sowell v. Federal Reserve Bank, 268 U.S. 449, 456 457, 45 S.Ct. 528, 530, 69 L.Ed. 1041 (1925). The Courts of Appeals of two Circuits have applied the doctrine, despite state law, to the collection of federal tax liens. United States v. Behrens, supra, and United States v. Wintner, D.C., 200 F.Supp. 157, aff'd 312 F.2d 749 (C.A.6th Cir.). We note, however, that Behrens antedates our Stern and Bess opinions as well as those in Aquilino v. United States, 363 U.S. 509, 80 S.Ct. 1277, 4 L.Ed.2d 1365 (1960), and United States v. Durham Lumber Co., 363 U.S. 522, 80 S.Ct. 1282, 4 L.Ed.2d 1371 (1960). These latter two cases held that competing liens of the Government for taxes and of subcontractors for labor and materials to a fund due the taxpayer under a general construction contract were controlled by applicable state law. This Court has never applied the doctrine of marshaling to federal income tax liens although it did deny the petition for certiorari filed in the Behrens case, supra, 351 U.S. 919, 76 S.Ct. 709, 100 L.Ed. 1451. Nor has the Congress seen fit to lay down any rules with reference to the application of the doctrine, apparently leaving the problem to this Court.
IV.
7
In considering the relevance of the doctrine here it is well to remember that marshaling is not bottomed on the law of contracts or l ens. It is founded instead in equity, being designed to promote fair dealing and justice. Its purpose is to prevent the arbitrary action of a senior lienor from destroying the rights of a junior lienor or a creditor having less security. It deals with the rights of all who have an interest in the property involved and is applied only when it can be equitably fashioned as to all of the parties. Thus, state courts have refused to apply it where state-created homestead exemptions would be destroyed, Sims v. McFadden, 217 Ark. 810, 23 S.W.2d 375; or where the righs of insurance beneficiaries would be adversely affected, Bruns v. First Trust & Deposit Co., 250 App.Div. 370, 295 N.Y.S. 412; or where the rights of third parties having equal equity would be prejudiced, Barbin v. Moore, 85 N.H. 362, 159 A. 409, 83 A.L.R. 62; or where the 'head of the household' exemption was involved, Westgrove Savings Bank v. Dunlavy, 190 Iowa 1054, 181 N.W. 404, and Pugh v. Whitsitt & Guerry, 161 S.W. 953 (Tex.Ct.Civ.App.). Federal courts have likewise accepted this principle of the nonapplicability of the doctrine where, as here, one of the funds is exempt under state law. See In re Bailey, 8 Cir., 176 F. 990, where a state legislative homestead exemption was held to be a superior equity in the hands of a bankrupt, preventing the marshaling of assets to his disadvantage; Robert Moody & Son v. Century Savings Bank, 239 U.S. 374, 378, 36 S.Ct. 111, 113, 60 L.Ed. 336 (1915), where Iowa's requirement that a homestead, even when validly mortgaged, may be sold only for a deficiency remaining after exhausting all other property was declared available to a junior mortgagee to prevent a marshaling of assets; and Lockwood v. Exchange Bank, 190 U.S. 294, 300—301, 23 S.Ct. 751, 753—754, 47 L.Ed. 1061 (1903), where a waiver of state exemption statutes was held to have no effect in bankruptcy since the title to the exempted property remained in the bankrupt and never reached the trustee's hands. It, therefore, seems clear that the courts have considered state exemption statutes when weighing the equities between parties to determine the applicability of the marshaling doctrine. This is in line with that deference to state law of our recent cases, discussed above, holding that state law controls the determination of what is included within the 'property or right to property' covered by § 3670 and upon which the federal tax lien could attach. In addition, this Court in United States v. Brosnan, 363 U.S. 237, 80 S.Ct. 1108, 4 L.Ed.2d 1192 (1960), when faced with a comparable problem involving collection of federal taxes, found
8
'it desirable to adopt as federal law state law governing divestiture of federal tax liens, except to the extent that Congress may have entered the field. It is true that such liens form part of the machinery for the collection of federal taxes * * *. However, when Congress resorted to the use of liens, it came into an area of complex property relationships long since settled and regulated by state law. * * * We think it more harmonious with the tenets of our federal system and more consistent with what Congress has already done in this area, not to inject ourselves into the network of competing private property interests, by displacing well-established state procedures governing their enforcement, or superimposing on them a new federal rule.' At 241—242, of 363 U.S., 80 S.Ct. at page 1111, 4 L.Ed.2d 1192.
9
Congress has not seen fit to change the rules this Court fashioned in these cases. Indeed, it has not only permitted them to stand but, as was said in Holden v. Stratton, 198 U.S. 202, 213 214, 25 S.Ct. 656, 659, 49 L.Ed. 1018 (1905), 'It has always been the policy of Congress, both in general legislation and in bankrupt acts, to recognize and give effect to the state exemption laws.' There are many examples, among which is the incorporation in the bankruptcy law of the exemptions made available by the State of a bankrupt's domicile. See 52 Stat. 847, 11 U.S.C § 24. This includes the exemption of life insurance proceeds. See Holden v. Stratton, supra, 198 U.S. at 212—213, 25 S.Ct. at 659, 49 L.Ed. 1018. In addition, other exemptions have been added from time to time, such as the exclusion from taxation of the benefits from life insurance policies, Internal Revenue Code of 1954, § 101(a), and the exception of life insurance benefits in which the surviving spouse has exclusive power of appointment from the rule that terminal interests may not qualify for the marital deduction. Internal Revenue Code of 1954, § 2056(b) (6).
10
We cannot overlook this long-established policy. In the absence of a definitive statutory rule to the contrary we therefore adopt the state rule and refuse to extend the equitable doctrine of marshaling assets to this situation. New York has a specific statute which exempts insurance benefits of a widow from the claim of creditors of her husband's estate and its courts have refused to marshal assets where to do so will diminish those rights. Bruns v. First Trust & Deposit Co., supra. To apply marshaling in this case would overturn New York's beneficent policy and, in addition, would enlarge the federal tax lien that the Congress has provided in § 3670. This we will not do. The judgment is therefore reversed.
11
Reversed.
12
Mr. Justice WHITE, with whom Mr. Justice HARLAN and Mr. Justice STEWART concur, dissenting.
13
I cannot for several reasons join the Court in reversing the decision of the Court of Appeals.
14
1. It is, of course, federal law which should rule this case. We are dealing here with a federal income tax lien, created by congressional enactment. Problems of interpretation under that legislation are federal problems, and should be governed as nearly as may be by principles of uniform application throughout the various States. Determining the priority of § 3670 liens by reference to state law may permit the United States to assert its lien in one State but forbid it in another in precisely the same circumstances.
15
The very proposition upon which the Court's decision seems to rest—that the Government's lien under § 3670 depends on whether state law recognizes similar liens asserted by private creditors was rejected in United States v. Bess, 357 U.S. 51, 78 S.Ct. 1054, 2 L.Ed.2d 1135, where it was argued that the United States had no claim against the cash surrender value of insurance policies because a New Jersey statute barred the similar claims of private creditors. This Court looked to local law to determine whether the taxpayer had 'sufficient interests * * * to satisfy the requirements of § 3670' but declared state law 'inoperative to prevent the attachment of liens created by federal statutes in favor of the United States. * * * The fact that in § 3691 Congress provided specific exemptions from distraint is evidence that Congress did not intend to recognize further exemptions which would prevent attachment of liens under § 3670.'
16
The basic principle in Bess was further amplified by Aquilino v. United States, 363 U.S. 509, 80 S.Ct. 1277, 4 L.Ed.2d 1365, and United States v. Durham Lumber Co., 363 U.S. 522, 80 S.Ct. 1282, 4 L.Ed.2d 1371, where the following guidelines were laid down:
17
'(A)s we held only two Terms ago, Section 3670 'creates no property rights but merely attaches consequences, federally defined, to rights created under state law * * *.' United States v. Bess, 357 U.S. 51, 55, 78 S.Ct. 1054, 1057, 2 L.Ed.2d 1135. However, once the tax lien has attached to the taxpayer's state-created interests, we enter the province of federal law, which we have consistently held determines the priority of competing liens asserted against the taxpayer's 'property' or 'rights to property.' (Citing cases in this Court.) The application of state law in ascertaining the taxpayer's property rights and of federal law in reconciling the claims of competing lienors is based both upon logic and sound legal principles. This approach strikes a proper balance between the legitimate and traditional interest which the State has in creating and defining the property interest of its citizens, and the necessity for a uniform administration of the federal revenue statutes.' 363 U.S., at 513—514, 80 S.Ct. at 1280, 4 L.Ed.2d 1365.
18
Undoubtedly the deceased taxpayer here possessed property—the cash surrender value of insurance policies—to which the tax lien attached by the force of federal law. The problem remaining is the reconciliation of the competing claims to the proceeds. Under Bess, Aquilino and Durham the problem must be solved as a matter of federal law. State law may be one of the sources guiding the formation of federal policy, but according to prior cases in this Court, it is not controlling and does not have the compelling force given it by the Court.
19
2. Whatever force local law is to have, however, I find it difficult to accept the Court's exposition of New York policy.
20
Section 166 of the New York Insurance Law, the Court says, protects insurance benefits from the claims of creditors of the deceased insured. Obviously, however, no part of the proceeds of the policy, whether cash surrender value or otherwise, is protected from the claims of the secured creditor who has taken an assignment of the policy as collateral security during the lifetime of the insured. This is apparent from the face of the statute itself,1 and in this very case no question has been raised about the rights of the bank, surely a creditor, to collect every dollar owed to it from the proceeds of the policy. Likewise, had there been no bank loan here, or had it been paid by the insured prior to his death, it is conceded that the federal tax lien would be satisfied from the proceeds to the extent of the cash surrender value. In fact, the beneficiary in this case paid over to the United States the portion of the cash surrender value remaining after the debt of the bank had been paid.
21
New York, therefore, cannot be said to have a policy of insulating the proceeds of insurance policies from the claims of creditors who have acquired a security interest in the proceeds during the lifetime of the insured. The insured in this case, the owner of the policy, could change the beneficiary and destroy the latter's interest entirely. He could likewise encumber the proceeds and limit the beneficiary's rights to the net amount remaining after the payment of creditors with liens on the proceeds. The protected interest of the beneficiary extends only to the net proceeds. In re Kelley's Estate, 251 App.Div. 847, 296 N.Y.S. 923. The beneficiary has an unsecured claim, inferior to that of encumbrancers, but good as against unsecured creditors of the insured. This is what the New York policy is, as it seems to me.
22
Neither is there anything in Bruns v. First Trust & Deposit Co., 250 App.Div. 370, 295 N.Y.S. 412, which validates the Court's definition of New York policy. In that case a bank held both insurance policies and other property as collateral security for debts owed it by the insured. The Appellate Division refused to permit collection of the bank loan from the insurance proceeds in order that unsecured creditors could resort to the other property held by the bank. The case prefers the beneficiary to the unsecured creditor who has no independent claim to the proceeds, but it does not suggest that those with security interests in the proceeds would be likewise subordinated.
23
Moreover, further question about New York policy is raised by In re Kelley's Estate, supra, a case which is difficult to reconcile with Bruns. In that case, as in Bruns, the insured had assigned a policy and had pledged shares of stock as security for a bank loan. Upon his death the bank was paid from the insurance proceeds and the stock remained available to the executor and the insured's estate. The App llate Division apparently saw nothing wrong with such an application of the insurance proceeds, denied that the widow had any interest in them to the extent they were necessary to pay the bank loan and further denied the widow's claim to be subrogated to the bank's rights in the stock.2
24
Twice—in this case and in United States v. Behrens, 230 F.2d 504 (C.A.2d Cir.)—the Court of Appeals has ordered payment of both the lien of a bank and the inferior federal tax lien. In neither case did it indicate it was trenching upon an established state policy involving marshaling of assets. If the result is to depend upon state policy, which at the very least is shrouded in doubt and which it seems to me is not what the Court says it is, I would follow our usual custom3 of leaving to the Court of Appeals the ascertainment of the local law in which it specializes.4 Pitching the result upon state law, even as a guide to the governing federal law, should lead to a remand rather than to decision here.
25
3. The deceased made the assignment to the bank in 1943. Deficiencies in federal income taxes for the years 1945 and 1946 were assessed on May 22, 1946, and June 17, 1947, respectively. Partial payments were made upon the 1945 assessments, none on the 1946. The deceased in 1951 extended the time for collection of the 1945 deficiencies until 1956 and of the 1946 deficiency until 1957. He submitted an offer of compromise in 1955 which was rejected by the Government in May of that year. Notice of tax lien was filed in July 1955, and the deceased died the following December. At that time the cash surrender value of the policies had grown to $27,285.87 and the amount due on the bank loans totaled $26,844.66. The insurance company remitted the amount of the loans to the bank and paid the remainder of the proceeds to the named beneficiary of the policies. There are no facts or findings to indicate that the amount paid to the bank by the insurance company was paid from the cash surrender value. In these circumstances I see no reason for assuming that it was and no basis for forbidding collection of the tax lien from the amounts paid the beneficiary.
26
The deceased first reduced the beneficiary's interest in the proceeds of the policies by making the assignment to the bank. He then allowed another lien to attach by his own default, thereby further invading the proceeds. Where there is no prior assignment, it is clear that the government lien effectively diminishes the proceeds in the hands of the beneficiary since the Government's interest in the proceeds is superior to that of the beneficiary. It is unsound to hold, as the Court does, that the lien may not have like effect when the insured has given a prior lien on the proceeds to secure a bank loan. True, paying the tax lien from the cash surrender value results in the bank's being paid from the remainder. But this is precisely what the insured arranged for since the loan, by its very terms, was collectible from any part of the proceeds, which were more than sufficient to pay both the loan and government lien.5
27
Nor is there any superior equity in the beneficiary to prevent the application of the well-established rule of marshaling, a rule long recognized by this Court.6 It is not unreasonable to suppose that the beneficiary enjoyed the benefits of the bank loan which is here used to insulate the cash surrender value from the government lien. What is more, the insured and his family used and spent the income which should have been used to pay federal taxes which had been due and payable for many years. Paying both the bank and the tax lien from the proceeds is wholly consistent with the arrangements made by the insured and with this Court's holding in Bess.
28
Finally, the federal revenue deserves more protection than it receives today. The Court may now protect a widow, but the rule announced will protect all beneficiaries, varied as they may be.7 Congress has declared that the United States shall have a lien on the assets of those persons who do not discharge their federal tax obligations. This Court now creates an exception to that policy by holding that the tax lien may not be paid from the cash surrender value of the insurance policy, solely because prior to the attachment of the tax lien Mr. Meyer had assigned the entire proceeds as collateral for a bank loan. I would not invite or validate the utilization of continuing and growing bank loans for the sole purpose of insulating insurance proceeds from the federal tax lien which otherwise would be satisfied from the policy proceeds.
29
There are in this case two secured creditors and two funds. The total assets are sufficient to satisfy the claims of both creditors, but the junior claimant has a lien on only one of the funds. It is entirely appropriate here to require the payment of both liens.
30
For the foregoing reasons, I respectfully dissent.
*
'1. If any policy of insurance has been or shall be effected by any person on his own life in favor of a third person beneficiary, or made payable, by assignment, change of beneficiary or otherwise, to a third person, such third person beneficiary, assignee or payee shall be entitled to the proceeds and avails of such policy as against the creditors, personal representatives, trustees in bankruptcy and receivers in state and federal courts of the person effecting the insurance.' New York Insurance Law, § 166.
1
Section 166 is quoted in part in the footnote to the Court's opinion. It obviously protects assignees, even creditor-assignees, from the other creditors of the insured.
2
'When the husband executed his certificate on August 15, 1932, revoking the designation of his wife as the absolute beneficiary and redesignating her as beneficiary subject to the assignment to the Manufacturers Trust Company, he thereby diminished her interest in the policy pro tanto and, in effect, constituted the trust company the primary beneficiary to the extent necessary to satisfy its loan to him and appellant, the secondary beneficiary, as to any residue which may remain. Under section 52, Domestic Relations Law, and section 55—a, Insurance Law, the wife may acquire a vested, irrevocable right to the proceeds of the policy, free from the claims of the husband's creditors and representatives, only if the husband die without exercising his reserved right to change the beneficiary in accordance with the provisions of the policy. Here the husband exercised that right to the extent necessary to satisfy his loan. Hence, when the trust company applied the proceeds of the policy to the payment of the loan, it was not utilizing appellant's property and she could not be subrogated to the rights of the bank with respect to the stock of the Fairview Foundry, Incorporated.' In re Kelley's Estate, 251 App.Div. 847—848, 296 N.Y.S. 923—924.
3
United States v. Durham Lumber Co., 363 U.S. 522, 526—527, 80 S.Ct. 1282, 1284—1285, 4 L.Ed.2d 1371; Propper v. Clark, 337 U.S. 472, 486—487, 69 S.Ct. 1333, 1341—1342, 93 L.Ed. 1480.
4
The Court of Appeals has frequently dealt with § 166 of the New York Insurance Law. See for example Fried v. New York Life Ins. Co., 2 Cir., 241 F.2d 504; United States v. Behrens, 2 Cir., 230 F.2d 504, cert. denied, 351 U.S. 919, 76 S.Ct. 709, 100 L.Ed. 1451; Rowen v. Commissioner, 2 Cir., 215 F.2d 641.
5
Where the tax lien is inferior to local lien A but superior to local lien B, the tax lien is to be paid even though lien A, superior to the federal lien, is cut out because under local law it is inferior to lien B. United States v. Buffalo Savings Bank, 371 U.S. 228, 83 S.Ct. 314, 9 L.Ed.2d 283; United States v. City of New Britain, 347 U.S. 81, 74 S.Ct. 367, 98 L.Ed. 520. In the case at bar there is more reason to recognize and pay the tax lien; for if it is paid, it is only an inferior interest, that of the beneficiary, which is invaded.
6
'The equitable doctrine of marshaling rests upon the principle that a creditor having two funds to satisfy his debt may not, by his application of them to his demand, defeat another creditor, who may resort to only one of the funds.' Sowell v. Federal Reserve Bank, 268 U.S. 449, 456—457, 45 S.Ct. 528, 69 L.Ed. 1041. See also Merrill v. National Bank of Jacksonville, 173 U.S. 131, 138, 19 S.Ct. 360, 363, 43 L.Ed. 640; Scruggs v. Memphis & Charleston R. Co., 108 U.S. 368, 2 S.Ct. 780, 27 L.Ed. 756; Savings Bank v. Creswell, 100 U.S. 630, 641, 25 L.Ed. 713; Fenwick v. Chapman, 9 Pet. 461, 474, 9 L.Ed. 193; 2 Story's Equity Jurisprudence, §§ 758, 760, 853—871; 2 Pomeroy's Equity Jurisprudence, §§ 396, 410; 4 Pomeroy's Equity Jurisprudence, § 1414.
7
Since § 166 would not protect the insurance proceeds from creditors' claims where the insured or his estate is the beneficiary, I would suppose the Court's opinion would likewise permit payment of the tax lien in such circumstances. Would the same apply to where the executor or administrator is the beneficiary? And what is the result when the eneficiary is the insured's partner or business associate, or a corporation in which he has an interest?
| 1112
|
375 U.S. 248
84 S.Ct. 360
11 L.Ed.2d 311
Edward R. FIELDS et al., appellants,v.CITY OF FAIRFIELD.
No. 30.
Supreme Court of the United States
October Term, 1963.
December 16, 1963
Melvin L. Wulf for appellants.
Burke Marshall for the United States, as amicus curiae, by special leave of Court.
Frank B. Parsons for appellee.
PER CURIAM.
1
The udgment of the Supreme Court of Alabama is reversed. Thompson v. City of Louisville, 362 U.S. 199, 80 S.Ct. 624, 4 L.Ed.2d 654; Garner v. Louisiana, 368 U.S. 157, 82 S.Ct. 248, 7 L.Ed.2d 207.
| 23
|
375 U.S. 217
84 S.Ct. 306
11 L.Ed.2d 281
Francesco FOTI, also known as Frank Foti, Petitioner,v.IMMIGRATION AND NATURALIZATION SERVICE.
No. 28.
Argued Oct. 17 and 21, 1963.
Decided Dec. 16, 1963.
James J. Cally, New York City, for petitioner.
Philip R. Monahan, Washington, D.C., for respondent.
Mr. Chief Justice WARREN delivered the opinion of the Court.
1
Involved in this case is the single question of whether the Federal Courts of Appeals have the initial, exclusive jurisdiction, under § 106(a) of the Immigration and Nationality Act, to review discretionary determinations of the Attorney General, relating to the suspension of deportation, under § 244(a)(5) of the Act.
2
Petitioner, a 47-year-old alien and a native and citizen of Italy, last entered the United States in late 1950, through the port of Norfolk, Virginia, on a seaman's visa which authorized him to remain in this country for a period not to exceed 29 days. He remained here illegally for more than 10 years, leaving his wife and three minor children in Italy. In 1961, deportation proceedings were instituted against petitioner, directing him to appear before a special inquiry officer of the Immigration and Naturalization Service and show cause why he should not be deported under § 241(a)(2) of the Immigration and Nationality Act of 1952, 8 U.S.C. § 1251(a)(2), as an alien who had unlawfully overstayed the period for which he had been admitted. At a hearing conducted before a special inquiry officer under § 242(b) of the Act, petitioner conceded his deportability, and applied, in the alternative, for two forms of discretionary relief which the Attorney General is authorized by the Act to grant to deportable persons who meet defined eligibility requirements. He sought, pursuant to § 244(a)(5) of the Act, a suspension of deportation on the ground that it would be difficult for him to earn a living for his family in Italy if he were deported and deportation would result in his having to liquidate the bakery business which he owned and operated in Brooklyn, New York. Alternatively, if suspension of deportation were refused, petitioner requested, pursuant to § 244(e) of the Act, the privilege of voluntary departure at his own expense in lieu of deportation. The special inquiry officer, although finding that petitioner met the good moral character and 10 years' continuous presence in the United States requirements of § 244(a)(5), denied his application for suspension of deportation, on the ground that petitioner was ineligible for that form of discretionary relief since his deportation would not result 'in exceptional and extremely unusual hardship * * *.' Petitioner's alternative request for the privilege of voluntary departure was granted, however.1 Petitioner appealed to the Board of Immigration Appeals from that part of the order of the special inquiry officer which denied his request for suspension of deportation. The Board, on November 28, 1961, dismissed the appeal. Petitioner was directed to effect his departure by December 18, 1961. Prior to that date, petitioner commenced an action in the Federal District Court for the Southern District of New York, seeking declaratory and injunctive relief from the administrative refusal to grant his request for suspension of deportation. The District Court dismissed the action on the ground that, under the recently enacted § 106(a) of the Immigration and Nationality Act, 8 U.S.C. § 1105a(a),2 the sole and exclusive procedure for obtaining judicial review of such a determination was by a petition for review filed in an appropriate Federal Court of Appeals. Accordingly, petitioner then sought review in the Court of Appeals for the Second Circuit. On September 21, 1962, the Court of Appeals, sitting en banc and by a five-to-four vote, dismissed the petition for lack of jurisdiction, holding that the term 'final orders of deportation' in § 106(a) does not include a denial of discretionary relief under § 244(a)(5). 2 Cir., 308 F.2d 779. Because of a conflict among the Courts of Appeals regarding the interpretation of this jurisdictional language in s 106(a),3 we granted certiorari, limited to the question whether Courts of Appeals have jurisdiction to review final administrative orders with respect to discretionary relief sought during deportation proceedings. 371 U.S. 947, 83 S.Ct. 503, 9 L.Ed.2d 496.
3
The issue involved here is solely one relating to procedures incident to deportation proceedings. In the present posture of the case, we need not be concerned with the ultimate merits as to petitioner's deportability,4 since he concedes that he is deportable and the question of the propriety of the administrative refusal of suspension of deportation has not as yet been reviewed in any lower federal court. The only question presented for decision involves the scope of judicial review by the Courts of Appeals of administrative determinations made during the course of deportation proceedings. Specifically, we must decide a rather narrow question of statutory construction—whether a refusal by the Attorney General to grant a suspension of deportation is one of those 'final orders of deportation' of which direct review by Courts of Appeals is authorized under § 106(a) of the Act. Both parties have contended that it is. While the question is not free of difficulty, as evidenced by the division in the court below and the conflict among the various Courts of Appeals on the matter, we have concluded that the court below erred in holding that it was not.
4
The statutory provision in question, § 106(a) of the Immigration and Nationality Act, provides that the procedure for judicial review by the Courts of Appeals of certain orders5 of the Federal Communications Commission, Secretary of Agriculture, Federal Maritime Board and Atomic Energy Commission shall also 'apply to, and shall be the sole and exclusive procedure for, the judicial review of all final orders of deportation heretofore or hereafter made against aliens within the United States pursuant to administrative proceedings under section 242(b) of this Act or comparable provisions of any prior Act * * *.' Section 242 provides a detailed administrative procedure for determining whether an alien should be deported. Sections 243 and 244 relate to certain situations in which the Attorney General may suspend deportation in his discretion. In its decision below, the Court of Appeals for the Second Circuit held that § 106(a) applies only to orders required by statute to be made in a § 242(b) hearing, i.e., findings of deportability.
5
Both petitioner and the Government have urged that the decision below should be reversed, and that the statutory language should be so construed as to include both an adjudication of deportability and an order denying suspension of deportation. Based on the historical background of the Immigration and Nationality Act,6 the manifest purpose of Congress in enacting § 106(a), the context of the statutory language when viewed against the prevailing administrative practices and procedures, and pertinent legislative history of § 106(a), we are led to the conclusion that the interpretation argued for by petitioner and the Government is the correct one.
6
Prior to 1940, the Attorney General had no discretion with respect to the deportation of an alien who came within the defined category of deportable persons. The expulsion of such a person was mandatory; his only avenue of relief in a hardship case was by a private bill in Congress. Therefore, any differentiation that might have been made prior to 1940 between a determination that an alien was deportable and the order directing his deportation would have been merely formalistic and essentially meaningless. In fact, the determination of deportability necessarily resulted in, and was invariably accompanied by, a deportation order. Since 1940, however, when the Attorney General was given the power to grant discretionary relief under various circumstances in deportation cases,7 administrative regulations having the force and effect of law have provided for the practice of determining deportability and ruling on an application for suspension of deportation in a single proceeding conducted by the Immigration and Naturalization Service. Thus, the administrative discretion to grant a suspension of deportation has historically been consistently exercised as an integral part of the proceedings which have led to the issuance of a final deportation order, and discretionary relief, if sought, must be requested prior to or during the deportation hearing. The hearings on deportability and on an application for discretionary relief have, as a matter of traditional uniform practice, been held in one proceeding before the same special inquiry officer, resulting in one final order of deportation. Significantly, when suspension is granted, no deportation order is rendered at all, even if the alien is in fact found to be deportable.
7
It must be concluded that Congress knew of this familiar administrative practice and had it in mind when it enacted § 106(a). These usages and procedures, which were actually followed when the provision was enacted, must reasonably be regarded as composing the context of the legislation. A colloquy between Congressmen Walter, Lindsay and Moore, all knowledgeable in deportation matters,8 is definitely corroborative of this view. This colloquy occurred during the House debates on the predecessor to the bill which was enacted in 1961 and contained § 106(a).9 Representative Lindsay suggested that the legislative history should make absolutely clear 'that if there is any remedy on the administrative level left of any nature, that the deportation order will not be considered final.' Representative Walter agreed, and stated that 'the final order means the final administrative order.' With Representative Moore concurring, all three congressmen agreed that there would be no 'final order of deportation' until after determination of the question of suspension. Significantly, Representative Walter, in discussing the running of the time period provided for the filing of petitions for review by the Courts of Appeals under the proposed legislation, stated that 'the 6 months' period on the question of finality of an order applies to the final administrative adjudication of the applications for suspension of deportation just as it would apply to any other issue brought up in deportation proceedings.' With the dissenters below, we feel that the court's speculation that few congressmen were present at the time of this exchange was unwarranted and probably immaterial.
8
It can hardly be contended that the meaning of the phrase 'final orders of deportation' is so clear and unambiguous as to be susceptible of only a narrow interpretation confined solely to determinations of deportability. If anything, the literal language would appear to include a denial of discretionary relief, made during the same proceedings in which deportability is de ermined, which effectively terminates the proceeding. In arriving at the intended construction of this language, we must therefore inevitably turn to the purpose of Congress in enacting this legislation. The fundamental purpose behind § 106(a) was to abbreviate the process of judicial review of deportation orders in order to frustrate certain practices which had come to the attention of Congress, whereby persons subject to deportation were forestalling departure by dilatory tactics in the courts. A House Judiciary Committee report succinctly stated the problem to which Congress addressed itself in enacting § 106(a).10 It indicated that the Committee 'has been disturbed in recent years to observe the growing frequency of judicial actions being instituted by undesirable aliens whose cases have no legal basis or merit, but which are brought solely for the purpose of preventing or delaying indefinitely their deportation from this country.' Pointing to the essence of the problem, the report continued:
9
'Other aliens, mostly subversives, gangsters, immoral (persons), or narcotic peddlers, manage to protract their stay here indefinitely only because their ill-gotten gains permit them to procure the services of astute attorneys who know how to skillfully exploit the judicial process. Without any reflection upon the courts, it is undoubtedly now the fact that such tactics can prevent enforcement of the deportation provisions of the Immigration and Nationality Act by repetitive appeals to the busy and overworked courts with frivolous claims of impropriety in the deportation proceedings.'
10
The key feature of the congressional plan directed at this problem was the elimination of the previous initial step in obtaining judicial review—a suit in a District Court—and the resulting restriction of review to Courts of Appeals, subject only to the certiorari jurisdiction of this Court. As stated in the same Committee report, the plain objective of § 106(a) was 'to create a single, separate, statutory form of judicial review of administrative orders for the deportation * * * of aliens * * *.'11 Further evidence of a specific congressional intent to give Courts of Appeals exclusive jurisdiction to review denials of discretionary relief in deportation proceedings is contained in the legislative history. Case histories of abuse of the existing judicial review process, as summarized in the various Committee reports, include references to litigation arising out of discretionary determinations. And a reference chart reproduced in the Committee reports shows the denial of discretionary relief as being antecedent to and a constitutent part of the 'final order of deportation.' Although deportability and whether to grant a suspension are determined in the same hearing, the decision below means that an alien may appeal only the deportability finding to a Court of Appeals and must initially seek review of a denial of suspension in a District Court. A short analysis of the reasoning of the court below demonstrates that its conclusion is inconsistent with this manifest purpose of Congress.
11
Although the Court of Appeals agrees that the basic purpose of § 106(a) was to expedite the deportation of undesirable aliens by preventing successive dilatory appeals to various federal courts, it fails to apply that interpretation to the question presented in this case. Its finding that the bifurcated procedure resulting from an alien's seeking review of a denial of discretionary relief in a District Court and review of an adjudication of deportability, as is admittedly required by § 106(a), in a Court of Appeals would expedite the deportation is without foundation. It is premised on its assumption that, in actions to review denial of discretionary relief, District Courts rarely grant restraining orders. Reliance upon such an assumption, we feel, is unjustified.12 At all events, under the procedure urged by the petitioner and the Government, an alien can obtain an automatic stay of deportation under § 106(a) by seeking a review of the finding of deportability and can simultaneously seek review of the denial of discretionary relief in a Court of Appeals. Review of the denial of discretionary relief is ancillary to the deportability issue, and both determinations should therefore be made by the same court at the same time. We realize that deportability is conceded in a large number of cases.13 But this fact hardly detracts from our view as to a proper interpretation of § 106(a).14
12
In substance, we feel that the Court of Appeals was wrong in limiting the phrase 'final orders of deportation' in § 106(a) to adjudications of deportability. The finding of the court below that the phrase was a 'term of art' with a well-understood meaning, merely because it was used several times in §§ 242 and 244 when plainly referring only to rulings on deportability, cannot be substantiated. Section 106(a) was of course not enacted contemporaneously with §§ 242 and 244, and it is solely concerned with the rather different problem of judicial review. And the language of § 242(b) indicates that Congress plainly distinguished determinations of deportability from orders of deportation. We regard this as of especial relevance since § 106(a), in describing the 'final orders of deportation' intended to be encompassed thereunder, specifically refers to administrative proceedings conducted under § 242(b).
13
Paragraph (4) of the subsidiary exceptions to § 106(a) provides for review solely upon the administrative record and indicates that the findings of fact below are conclusive 'if supported by reasonable, substa tial, and probative evidence on the record considered as a whole.' However, this does not necessarily mean that Congress intended review in the Courts of Appeals to be restricted to adjudications of deportability. Admittedly, the standard of review applicable to denials of discretionary relief cannot be the same as that for adjudications of deportability, since judicial review of the former is concededly limited to determinations of whether there has been any abuse of administrative discretion. While paragraph (4) clearly applies only to review of adjudications of deportability, and possibly to review of administrative findings of eligibility for discretionary relief,15 this is not decisive with respect to the intent of Congress. The inclusion in one of the 'exceptions' to the principal provision of § 106(a) of a proviso which primarily could apply only to determinations of deportability does not necessarily indicate that the principal provision of the section was also intended to be thus limited. Since the adjudication of deportability is certainly the principal ingredient, and an indispensable one, of the ultimate result of the proceeding—a final order of deportation—it would not be unusual for Congress to include in an overall enactment relating to judicial review of all final orders of deportation a specific provision pertinent to the primary constituent of such an order.
14
Also, it seems rather clear that all determinations made during and incident to the administrative proceeding conducted by a special inquiry officer, and reviewable together by the Board of Immigration Appeals, such as orders denying voluntary departure pursuant to § 244(e) and orders denying the withholding of deportation under § 243(h), are likewise included within the ambit of the exclusive jurisdiction of the Courts of Appeals under § 106(a). We see nothing anomalous about the fact that a change in the administrative regulations may effectively broaden or narrow the scope of review available in the Courts of Appeals.16 Furthermore, we do not regard it 'in the last degree unlikely' that Congress intended a court of three judges to initially review discretionary determinations denying suspension of deportation. Much of the litigation in deportation cases with respect to the setting aside of an administrative determination on the ground of arbitrariness involves disputed eligibility questions and matters of statutory construction. Additionally, the concern of the court below does not comport with the declared purpose of § 106(a) to eliminate the District Court stage of the judicial review process in an effort to prevent dilatory tactics. And the suggestion of the court below that it is 'incredible' that Congress meant to burden the Courts of Appeals with review of all orders denying discretionary relief in deportation cases is unconvincing. Congress presumably realized that, in practical effect, those engaged in dilatory tactics would hardly hesitate to appeal to a Court of Appeals from an adverse District Court determination where discretionary relief had been denied in the administrative proceeding.17
15
We need not pass at this time on whether § 106(a) extends the exclusive jurisdiction of the Courts of Appeals to include review of orders refusing to reopen deportation proceedings.18 The question is admittedly a somewhat different one, since such an administrative determination is not made during the same proceeding where deportability is determined and discretionary relief is denied. And, of course, our decision in this case in no way impairs the preservation and availability of habeas corpus relief.19
16
We believe that the controlling intention of Congress, in enacting § 106( ), was to prevent delays in the deportation process by vesting in the Courts of Appeals sole jurisdiction to review 'all final orders of deportation.' It seems apparent that, because of the consistent practice under the administrative regulations since 1940 of adjudicating deportability and passing on applications for discretionary relief in the same proceeding, the final administrative action that Congress was thinking of in using the phrase 'final orders of deportation' included denials of suspension of deportation. To so construe § 106(a) does not constitute an expansion of 'the words used by Congress beyond their well-understood meaning.' Bifurcation of judicial review of deportation proceedings is not only inconvenient; it is clearly undesirable and not the necessary result from a fair interpretation of the pertinent statutory language. Therefore, this matter can and should be passed upon by the Courts of Appeals, resulting in a judicial review procedure that would be both fair to the petitioner and expeditious for the Government. The decision below is therefore reversed and the case is remanded to the Court of Appeals for further consideration consistent with this opinion.
17
It is so ordered.
18
Decision reversed and case remanded.
19
Mr. Justice HARLAN, concurring.
20
Believing that a jurisdictional statute of this kind should be circumspectly construed, cf. Kesler v. Department of Public Safety, 369 U.S. 153, 156—157, 82 S.Ct. 807, 810—811, and recognizing the force of the considerations which concerned the majority of the Court of Appeals, 308 F.2d 779, I am nevertheless satisfied that the legislative history of § 106(a) of the Immigration and Nationality Act leaves no room for a conclusion other than that which this Court has reached.
21
I therefore concur in the judgment.
1
The granting of voluntary departure relief does not result in the alien's not being subject to an outstanding final order of deportation. In this case, the order granting voluntary departure was combined with a contingent deportation order, which directed that petitioner be deported if he failed to depart within the prescribed time and was to become effective automatically if petitioner did not depart the country by the date fixed by the District Director.
2
Immigration and Nationality Act, § 106, as added by § 5(a) of Public Law 87—301, approved September 26, 1961, 75 Stat. 651, 8 U.S.C. (Supp. IV, 1962) § 1105a.
3
Compare Fong v. Immigration and Naturalization Service, 308 F.2d 191 (C.A.9th Cir. 1962), Blagaic v. Flagg, 304 F.2d 623 (C.A.7th Cir. 1962), and Roumeliotis v. Immigration and Naturalization Service, 304 F.2d 453 (C.A.7th Cir. 1962), cert. denied, 371 U.S. 921, 83 S.Ct. 288, 9 L.Ed.2d 230, with Holz v. Immigration and Naturalization Service, 309 F.2d 452 (C.A.9th Cir. 1962), Zupicich v. Esperdy, 207 F.Supp. 574 (D.C.S.D.N.Y.1962), and the decision below.
4
On October 24, 1962, subsequent to the decision below and while the case was pending before this Court on petition for certiorari, Congress enacted Public Law 87—885, § 4, 76 Stat. 1247, effective the same date. This enactment provides, in relevant part, for the amendment of § 244 of the Act, the source of the Attorney General's power to suspend the deportation of eligible classes of aliens, by the addition of a new subsection, which states: '(f) No provision of this section shall be applicable to an alien who (1) entered the United States as a crewman * * *.' Although petitioner concededly entered the United States as a crewman, and the Government has indicated that, when the merits of this case are reached, it will argue that petitioner is now absolutely ineligible for the relief sought, because of the 1962 amendment to § 244, we agree with the parties that the enactment of this amendment did not necessarily have the effect of rendering moot the jurisdictional issue involved in this litigation. The applicability of this provision to one in petitioner's situation is an arguable matter, and, since it is not undisputed but remains debatable whether the relief sought by petitioner could still be granted, we have determined it not improper to consider and decide the threshold question of the jurisdiction of the Court of Appeals.
5
Hobbs Act, 64 Stat. 1129 (1950), as amended, 5 U.S.C. §§ 1031—1042, vesting the Courts of Appeals with exclusive jurisdiction to review final orders of certain designated federal agencies.
6
On the history of the recent congressional enactments relating to deportation, see Comment, 71 Yale L.J. 760 (1962).
7
Regarding the extent of the Attorney General's discretion in suspension of deportation cases, see, e.g., Jay v. Boyd, 351 U.S. 345, 354, 357—358, 76 S.Ct. 919, 924—925, 926—927, 100 L.Ed. 1242 (1956).
8
Representative Walter was the chairman of a subcommittee of the House Judiciary Committee responsible for immigration and nationality matters, author and chief sponsor of the measure under consideration, and a respected congressional leader in the whole area of immigration law. Representative Lindsay was thoroughly familiar with the problems in this area and the role of discretionary determinations denying suspension in the deportation process, as a result of having represented the Government, three years earlier, in Jay v. Boyd, 351 U.S. 345, 76 S.Ct. 919, 100 L.Ed. 1242 (1956). Representative Moore was a co-sponsor of the bill under discussion and a member of the House Judiciary Committee out of which the bill containing § 106(a) was reported.
9
105 Cong.Rec. 12728.
10
H.R.Rep. No. 1086, 87th Cong., 1st Sess. 22—23 (1961), U.S.Code Congressional and Administrative News 1961, p. 2950.
11
In further elucidating the purpose of the proposed legislation on the floor of the House, Representative Walter, in reference to one of the predecessor bills in 1958, stated: 'Most important, by eliminating review in the district courts, the bill would obviate one of the primary causes of delay in the final determination of all questions which may arise in a deportation proceeding.' 104 Cong.Rec. 17173.
12
According to the General Counsel of the Immigration and Naturalization Service, the Service's policy and practice is the Service's policy and practice is to stay deportation, sua sponte, when a petition to obtain judicial review of determinations made during the administrative proceedings is not 'patently frivolous.' See Comment, 111 U. of Pa.L.Rev. 1226, 1230 (1963). Consequently, temporary restraining orders issued by District Courts would usually be unnecessary to prevent deportation, and whether District Courts grant restraining orders rarely or frequently is rather irrelevant. And the assumption of the court below that, since the Attorney General can moot the proceedings in the District Courts (unless a restraining order is issued) by deporting the alien pendente lite, ultimate deportation would be expedited by permitting bifurcated judicial review seems unwarranted. Also, an assumption that the practice of District Courts is merely to issue restraining orders pending final disposition in a Court of Appeals of all of the questions presented for judicial review in a deportation case appears unjustified. See, e.g., Zupicich v. Esperdy, 207 F.Supp. 574 (D.C.S.D.N.Y.1962).
13
Deportability is conceded in about 80% of the cases. See Gordon and Rosenfield, Immigration Law and Procedure, § 5.7a, at 541 (1962). Even so, the bifurcation problem remains in that type of case which prompted the enactment of § 106(a), where judicial review of both an adjudication of deportability and a denial of discretionary relief is sought.
14
Because of the effect of our holding here, it is of course unnecessary to consider the Government's contention that, where deportability is actually adjudicated, a Court of Appeals has 'pendent jurisdiction' to review a denial of discretionary relief in the same proceeding.
15
In the instant case the special inquiry officer not only found that petitioner failed to meet the eligibility requirements for suspension of deportation, since no hardship would result from his deportation, but further indicated that, even had the hardship requirement been met, relief would have been denied as a discretionary matter. Since a special inquiry officer cannot exercise his discretion to suspend deportation until he finds the alien statutorily eligible for suspension, a finding of eligibility and an exercise of (or refusal to exercise) discretion may properly be considered as distinct and separate matters. And since the finding of eligibility involves questions of fact and law, paragraph (4) of § 106(a) might be read to require that this finding be based on substantial evidence in the record. See Comment, 111 U. of Pa.L.Rev. 1226, 1229 (1963). However, we need not pass on this question here. And, of course, denial of suspension of deportation as a discretionary matter is reviewable only for arbitrariness and abuse of discretion, and thus could hardly be within the procedural and evidentiary requisites of paragraph (4).
16
When § 106(a) was enacted, the withholding of deportation under § 243(h) was a matter determined by an official other than the special inquiry officer conducting the deportation hearing, on a later occasion, under regulations promulgated by the Attorney General, and the designation of the country of deportation was not made until after the issuance of the warrant of deportation. Under revised and currently effective regulations, both the designation of the country of deportation and the decision on any § 243(h) request for relief which the alien might wish to make are effected in the deportation proceedings and reflected in the final order of deportation. While presumably denials of § 243(h) relief were not covered by § 106(a) at the time of its enactment, it does not seem incongruous to assume that such orders, because of the change in administrative regulations making such decisions an integral part of the deportation proceedings conducted by a special inquiry officer, are now within the reach of § 106(a)'s judicial review provisions. Such a result simply means that, while the jurisdiction of the Courts of Appeals is limited now, as when § 106(a) was enacted, to the review of 'all final orders of deportation,' a change in the administrative regulations relating to the processing and determination of applications for § 243(h) relief had the incidental effect of expanding the decisional content of such orders. Clearly, changes in administrative procedures may affect the scope and content of various types of agency orders and thus the subject matter embraced in a judicial proceeding to review such orders.
17
Compare, however, 308 F.2d, at 785, n. 6, where the court below referred to the 'inarticulate premise that all deportation suits are appealed * * *' from District Courts to Courts of Appeals.
18
The court below manifested its concern that, if it were to find that it had jurisdiction in this case, the door would then be opened to the obtaining of review of a refusal to reopen a deportation proceeding in the Courts of Appeals. 308 F.2d, at 785. And the Government has argued in its brief that, although the question is a close one, an order refusing to reopen a deportation proceeding should be regarded as within the provisions of § 106(a) with respect to judicial review in the Courts of Appeals, though occurring subsequent to the issuance of a final deportation order. Brief for respondent, pp. 51—54. Compare Giova v. Rosenberg, 308 F.2d 347 (C.A.9th Cir. 1962), petition for cert. pending, No. 15, Misc., October Term, 1963. Cf. Dentico v. Immigration and Naturalization Service, 303 F.2d 137 (C.A.2d Cir, 1962), holding that Courts of Appeals have exclusive jurisdiction to review denials of motions to reopen deportation proceedings, where review of a final order of deportation is sought at the same time.
19
Compare the provisions of § 106(c) purporting to restrict the availability of habeas corpus relief in deportation cases. But see the provisions of § 106(a)(9) with respect to the availability of habeas corpus relief to aliens held in custody pursuant to a deportation order.
| 12
|
375 U.S. 253
84 S.Ct. 316
11 L.Ed.2d 307
EICHELv.NEW YORK CENTRAL RAILROAD CO.
No. 480.
Dec. 16, 1963.
Arnold B. Elkind and Richard C. Machcinski, for petitioner.
Gerald E. Dwyer, for respondent.
PER CURIAM.
1
Petitioner, who had been employed by respondent New York Central Railroad for 40 years, brought this action against respondent under the Federal Employers' Liability Act, 35 Stat. 65, as amended, 45 U.S.C. § 51 et seq., in the District Court for the Southern District of New York. The complaint alleged that in 1960, as a result of respondent's negligence petitioner suffered a permanently disabling injury. The jury returned a verdict of $51,000 for petitioner and the District Court entered judgment in accordance with that verdict. Respondent offered evidence that petitioner was receiving $190 a month in disability pension payments under the Railroad Retirement Act of 1937, 50 Stat. 309, as amended, 45 U.S.C. § 228b(a) 4. This evidence was offered for the purpose of impeaching the testimony of petitioner as to his motive for not returning to work and as to the permanency of his injuries. The trial court excluded the evidence in response to the objection of petitioner's counsel. The Court of Appeals for the Second Circuit reversed, holding it prejudicial error to exclude the evidence of the disability pension, and remanded 'for a new trial, limited, however, to the issues of injury and resulting damages * * *.' 2 Cir., 319 F.2d 12, 14. The court affirmed the judgment as to the determination of negligence.' Ibid. We grant certiorari and reverse the judgment of the Court of Appeals.
2
Respondent does not dispute that it would be highly improper for the disability pension payments to be considered in mitigation of the damages suffered by petitioner. Thus it has been recognized that:
3
'The Railroad Retirement Act is substantially a Social Security Act for employees of common carriers. * * * The benefits received under such a system of social legislation are not directly attributable to the contributions of the employer, so they cannot be considered in mitigation of the damages caused by the employer.' New York, N.H. & H.R. Co. v. Leary, 1 Cir., 204 F.2d 461, 468, cert. denied, 346 U.S. 856, 74 S.Ct. 71, 98 L.Ed. 370.1
4
Respondent argues that the evidence of the disability payments, although concededly inadmissible to offset or mitigate damages, is admissible as bearing on the extent and duration of the disability suffered by petitioner. At the trial counsel for respondent argued that the pension would show 'a motive for (petitioner's) not continuing work, and for his deciding not to continue going back to work after the last accident.' On the basis of this argument the Court of Appeals concluded that the disputed evidence should have been admitted because: 'Its substantial probative value cannot reasonably be said to be outweighed by the risk that it will * * * create substantial danger of undue prejudice through being considered by the jury for the incompetent purpose of a set-off against lost earnings.' 319 F.2d, at 20.
5
We disagree. In our view the likelihood of misuse by the jury clearly outweighs the value of this evidence.2 Insofar as the evidence bears on the issue of malingering, there will generally be other evidence having more probative value and involving less likelihood of prejudice than the receipt of a disability pension. Moreover, it would violate the spirit of the federal statutes if the receipt of disability benefits under the Railroad Retirement Act of 1937, 50 Stat. 309, as amended, 45 U.S.C. § 228b(a) 4, were considered as evidence of malingering by an employee asserting a claim under the Federal Employers' Liability Act. We have recently had occasion to be reminded that evidence of collateral benefits is readily subject to misuse by a jury. Tipton v. Socony Mobil Oil Co., Inc., 375 U.S. 34, 84 S.Ct. 1.3 It has long been recognized that evidence showing that the defendant is insured creates a substantial likelihood of misuse.4 Similarly, we must recognize that the petitioner's receipt of collateral social insurance benefits involves a substantial likelihood of prejudicial impact. We hold therefore that the District Court properly excluded the evidence of disability payments. Accordingly, the judgment of the Court of Appeals is reversed and the case remanded for proceedings consistent with this opinion.
6
Reversed and remanded.
7
Mr. Justice DOUGLAS concurs in the result.
8
Mr. Justice HARLAN, concurring in part and dissenting in part.
9
Once again, I am obliged to record my view that certiorari should not have been granted in a case of this kind, involving only a question of the admissibility of evidence in a suit under the Federal Employers' Liability Act, 35 Stat. 65, as amended, 45 U.S.C. § 51. See my dissenting opinion in Tipton v. Socony Mobil Oil Co., Inc., earlier this Term, 84 S.Ct., p. 3.
10
On the merits, I agree with the majority that the judgment below should be reversed, but for different reasons. Whether or not evidence that the petitioner was receiving disability pension payments under the Railroad Retirement Act of 1937, 50 Stat. 307, as amended, 45 U.S.C. § 228a, should have been admitted depends on a balance between its probative bearing on the issue as to which it was offered, in this case the respondent's claim that petitioner was a malingerer, and the possibility of prejudice to the petitioner resulting from the jury's consideration of the evidence on issues as to which it is irrelevant. When a balance of this sort has to be struck, it should, except in rare instances, be left to the discretion of the t ial judge, subject to review for abuse. See Uniform Rules of Evidence, Rule 45; Model Code of Evidence, Rule 303. It is he who is in the best position to weigh the relevant factors, such as the value of the disputed evidence as compared with other proof adducible to the same end and the effectiveness of limiting instructions. Believing that this rule should have been followed here, I concur in reversing the judgment below, which not only held the evidence not inadmissible as a matter of law but also directed its admission on retrial.
11
For the same reasons, however, I dissent from the majority's holding that the evidence is required to be excluded. I see no reason why evidentiary questions should be given different treatment when they arise in an F.E.L.A. case than when they arise in other contexts.
1
See Sinovich v. Erie R. Co., 3 Cir., 230 F.2d 658, 661; Page v. St. Louis S. Ry. Co., 5 Cir., 312 F.2d 84, 94. See also Gregory and Kalven, Cases and Materials on Torts (1959), pp. 480 482; McCormick, Damages (1935), p. 310, n. 2; Comment, 38 Mich.L.Rev. 1073.
2
Cf. McCormick, Evidence (1954), c. 19; 2 Wigmore, Evidence (1940), § 282a.
3
See Kalven, The Jury, the Law, and the Personal Injury Damage Award, 19 Ohio St.L.J. 158, 169.
4
See notes 1—3, supra.
| 78
|
375 U.S. 361
84 S.Ct. 378
11 L.Ed.2d 389
POLAR ICE CREAM & CREAMERY CO., Appellant,v.Charles O. ANDREWS, Jr., etc., et al.
No. 38.
Argued Nov. 20, 1963.
Decided Jan. 6, 1964.
[Syllabus from pages 361-362 intentionally omitted]
Joe J. Harrell, Pensacola, Fla., for appellant.
Mallory E. Horne, Tallahassee, Fla., and Johnson S. Savary, Inverness, Fla., for appellees.
Mr. Justice WHITE delivered the opinion of the Court.
1
We have before us the recurring question of the validity of a State's attempt to regulate the supply and distribution of milk and milk products. Challenged in this case is Florida's system of regulation of the dealings between milk distributors and local producers.
2
The appellant, Polar Ice Cream & Creamery Company, located in Pensacola, Florida, 16 miles from the Florida-Alabama state line, is a processor and distributor of fluid milk and milk products. It sells fluid milk and milk products for human consumption to consumers and dealers within the State of Florida in competition with nearby Alabama distributors. Pursuant to contracts let after competitive bidding, it also supplies large quantities of milk to military installations, both within and without the State of Folrida. It purchases, processes and sells as fluid milk or milk products approximately 5,000,000 gallons of milk each year.
3
Prior to the regulations challenged here, Polar purchased approximately 30% of its milk requirements from dairy farm producers located within the State of Florida. The remaining 70% was procured from producers, producer pools or brokers in other States, such as Alabama, Mississippi, Wisconsin, Minnesota, Missouri, Virginia, and Illinois. Its customary arrangement with Florida producers was to pay 61 cents per gallon for a specified quantity of milk from each producer and approximately 35.5 cents per gallon for all milk over that quantity. The price Polar paid its out-of-state sources varied; some milk was purchased for as low as 30—35 cents per gallon from Alabama, Virginia, and Arkansas sources. Polar's Florida producers could at no time supply all of Polar's milk requirements, but at times produced and sold to Polar amounts equal to or greater than Polar's sales of fluid milk for human consumption to consumers and dealers in Florida, excluding sales to the military, sales on reservations, and sales to local schools.
4
The statute and the orders of the Florida Milk Commission challenged by Polar regulate the dealings between milk distributors and milk producers located within the Pensacola Milk Marketing Area.1 First, they require that a Pensacola milk distributor pay a minimum price of 61 cents per gallon for all milk purchased from Pensacola producers and sold in Florida as Class I milk, defined as fluid milk or milk products sold in fluid form with exceptions, and substantially lower minimum prices for milk sold as Class II, III, and IV milk,2 consisting chiefly of nonbeverage milk such as cream, sour cream and other dairy products.
5
Second, the Commission has established a method by which a proportion of a distributor's monthly sales in various classes is allocated to designated Pensacola producers. Each Pensacola producer with whom Polar does business between September 1 and November 30 of each year, called the base-fixing period, is assigned an earned base, representing the ratio of milk delivered by such producer to the total milk delivered by all of Polar's Pensacola producers during the base-fixing period. The resultant percentage is then applied to the number of gallons of milk Polar sells in Class I, II, III, and IV channels monthly, in that order, to determine the number of gallons for which each earned-base producer must be paid the minimum prices assigned to each class or utilization.3 The allocation of a producer's deliveries must first be to Class I utilization, with allocation continued thereafter in descending order through the lower classifications. Only deliveries by Pensacola producers are considered in calculating the ratio of each producer's deliveries to total deliveries to Polar during th base-fixing period and therefore the percentage assigned to these producers totals 100%. The result is that all of Polar's Class I sales must be attributed to its Pensacola earned-base producers. Only then may their milk be used for the less remunerative utilizations, and only if these producers do not fulfill Polar's need for Class I milk may other milk be used for this purpose and thus command a premium price. Moreover, the formula requires that all the milk Polar sells in Florida be first attributed to the purchases that it makes from Pensacola producers.4 The earned-base percentages remain the same until the next base-fixing period.
6
Third, the statute forbids termination of the business relationship between a distributor and producer with whom the distributor has had a continuous course of dealing without just cause and provides that rejection or refusal to accept any milk tendered or offered for delivery by a producer in ordinary continuance of a previous course of dealings is a ground for revocation of the distributor's license.5 These statutory provisions have been construed to mean that a Florida distributor in a regulated marketing area must accept from his earned-base producers all the milk tendered by such producers, including milk in excess of Class I needs. A distributor is relieved of the obligation to purchase milk from earned-base producers only upon a showing of just cause, which is not met by a demonstration that the Commission's minimum prices are burdensome or that milk is available elsewhere at a lower price.6
7
It is this three-pronged regulatory structure, requiring Polar to accept its total supply of Class I milk, military milk aside, from designated Pensacola producers at a fixed price, and obligating it to take all milk which these producers offer, which Polar argues imposes an undue burden on interstate commerce.7
8
The Florida Milk Commission also proposed special provisions dealing with milk that is sold to military installations of the United States—military milk. Although challenged by Polar at the outset of this litigation, this plan was not voted into effect. While the present status of military milk under Florida law is not entirely clear from the record or arguments of the parties, we read the testimony of the Commission to mean that Polar is not required to purchase military milk from its Pensacola producers, as it is Class I milk. However, if Polar does utilize milk obtained from its earned-base producers for military sales, it must pay the minimum price applicable to Class I sales. Polar challenges this producer price requirement as inconsistent with the federal procurement policy of competitive bidding, and the Federal Government's exclusive jurisdiction over the installations on which this milk is consumed.
9
To finance the activities of the Milk Commission, Florida imposes a tax or regulatory fee of 15/100 of 1 cent per gallon of all milk handled by Florida distributors regardless of where purchased or to whom it is sold, including milk that Polar sells to military installations. This tax abates if at any time the revenue exceeds by 25% the total amount of Com ission expenditures as budgeted for that fiscal year.8 Polar, which clearly is obliged to pay this fee, contends that the State is without jurisdiction to include milk sold and delivered to military reservations, exclusive jurisdiction to which has been ceded to the United States, in calculating the amount of the tax.
10
Since Polar's objections to the Florida Milk Control Act posed substantial federal questions, a three-judge District Court was convened, 28 U.S.C. § 2281, and testimony was taken and arguments heard in respect to the above questions. This court found that the Florida Milk Control Act was a reasonable exercise of the State's police power and accordingly rejected Polar's claims that the Act, in fixing producer prices without assuring Polar any rate of return and in compelling Polar to take all the milk of its earned-base producers, denied it due process of law and equal protection. The District Court also found that Florida's fee on milk distributed by Polar to military installations was a regulatory fee based on the privilege of doing business in Florida and not a tax and concluded that this measure therefore did not unduly burden interstate commerce or infringe upon the exclusive jurisdiction of the United States over the military installations Polar serves. The Florida producer price controls were said not to conflict with the Federal Procurement Statutes, 10 U.S.C. § 2301 et seq., since they did not impose any restriction on the price paid by the Federal Government for its purchases from Polar. Although finding that the Florida regulations were intended to protect and favor Florida milk producers, the court upheld these regulations over Commerce Clause objections because there was no showing that the alleged discrimination against out-of-state producers burdened or restricted interstate commerce. The decision in Baldwin v. G. A. F. Seelig, Inc., 294 U.S. 511, 55 S.Ct. 497, 79 L.Ed. 1032, invalidating a state restriction imposed on a milk distributor to shield local milk producers from the effects of out-of-state competition, was deemed inapplicable to Florida's regulations. Because of the serious questions raised under the Commerce Clause and previous decisions here dealing with milk regulations, we noted probable jurisdiction. 372 U.S. 939, 83 S.Ct. 932, 9 L.Ed.2d 966. We have determined that under prior cases in this Court dealing with state regulation of the milk industry the Florida law as applied in this case cannot withstand attack based upon the Commerce Clause and that the judgment below must be reversed.
I.
11
The controlling cases are Baldwin v. Seelig, 294 U.S. 511, 55 S.Ct. 497, 79 L.Ed. 1032; Hood & Sons v. Du Mond, 336 U.S. 525, 69 S.Ct. 657, 93 L.Ed. 865; and Dean Milk Co. v. Madison, 340 .S. 349, 71 S.Ct. 295, 95 L.Ed. 329.
12
In Baldwin, the Metropolitan Milk District in the State of New York obtained about 70% of its supplies from New York sources, the remaining 30% from other States. The New York law forbade the sale in New York of milk obtained by a distributor from other States unless the distributor had paid a price which would be lawful under the New York price regulations. This provision was attacked by a New York milk distributor, all of whose milk supply was purchased in Vermont for less than the established New York price. Remarking that the New York law aimed at keeping 'the system unimpaired by competition from afar,' 294 U.S., at 519, 55 S.Ct., at 498, 79 L.Ed. 1032, the Court struck down this provision as an impermissible burden upon interstate commerce. New York could not outlaw Vermont milk purchased at below New York prices, for to do so would 'set a barrier to traffic between one state and another as effective as if customs duties, equal to the price differential, had been laid upon the thing transported,' 294 U.S., at 521, 55 S.Ct., at 500, 79 L.Ed. 1032—which is forbidden to the States by the Constitution, Art. I, § 10, cl. 2, and reserved to Congress by Art. I, § 8, cl. 3. Nice distinctions between direct and indirect burdens were said to be irrelevant.
13
'when the avowed purpose of the obstruction, as well as its necessary tendency, is to suppress or mitigate the consequences of competition between the states. * * * (A) chief occasion of the commerce clauses was 'the mutual jealousies and aggressions of the States, taking form in customs barriers and other economic retaliation.' Farrand, Records of the Federal Convention, vol. II, p. 308; vol. III, pp. 478, 547, 548; The Federalist, No. XLII; Curtis, History of the Constitution, vol. 1, p. 502; Story on the Constitution, § 259. If New York, in order to promote the economic welfare of her farmers, may guard them against competition with the cheaper prices of Vermont, the door has been opened to rivalries and reprisals that were meant to be averted by subjecting commerce between the states to the power of the nation.' 294 U.S., at 522, 55 S.Ct., at 500, 79 L.Ed. 1032.
14
To the argument that the law was in reality a health measure, since farmers must be protected from competition if they are to provide the reliable supply of healthful milk which the locality is entitled to have, the Court said,
15
'Let such an exception be admitted, and all that a state will have to do in times of stress and strain is to say that its farmers and merchants and workmen must be protected against competition from without, lest they go upon the poor relief lists or perish altogether. To give entrance to that excuse would be to invite a speedy end of our national solidarity. The Constitution was framed under the dominion of a political philosophy less parochial in range. It was framed upon the theory that the peoples of the several states must sink or swim together, and that in the long run prosperity and salvation are in union and not division.' 294 U.S., at 523, 55 S.Ct., at 500, 79 L.Ed. 1032.9
16
Bald in was heavily relied upon in both Du Mond and Dean, supra. In Du Mond, New York was found to have no power under the Commerce Clause to forbid an out-of-state distributor from establishing additional processing plants and additional sources of milk within the State. In Dean, the City of Madison was prevented from reserving the Madison market to producers and distributors located within a specified distance of the city, although purported considerations of public health were advanced as justifying the restriction.
17
The principles of Baldwin are as sound today as they were when announced. They justify, indeed require, invalidation as a burden on interstate commerce of that part of the Florida regulatory scheme which reserves to its local producers a substantial share of the Florida milk market.
II.
18
Under the controls challenged here, Polar must buy from its Florida producers, and pay 61 cents per gallon for it, an amount of raw milk equal to its Class I sales if it is available from these producers. If more than this amount is offered, Polar must also take the surplus at the lower established prices. And these obligations continue to bind Polar even though both its Class I needs and the surplus obtainable from Florida producers may steadily increase. Polar obviously will not and cannot use outside milk for those uses for which it is required to use Florida milk. Polar may turn to out-of-state sources only after exhausting the supply offered by its Pensacola producers. Under the challenged regulations, an Alabama dairy farmer could not become one of Polar's regular producers and sell all of his milk to that company. Since he could not share in the Class I market—Pensacola producers are probably able to supply that market—his milk could command only the lower prices applicable to the less remunerative uses, prices which would not cover his cost of production.10
19
The consequences for interstate commerce are clear. In Baldwin New York's price control removed any economic incentive for a local distributor to purchase out-of-state milk and thereby encouraged its distributors first to consume the local supply of milk before turning to out-of-state sources. Out-of-state milk was denied an equal opportunity to compete with New York-produced milk to the extent that the out-of-state supply bore additional transportation charges. The Florida controls preempt for the Florida producers a large share of the Florida market, especially the most lucrative fluid milk market. Out-of-state milk may not participate in this part of the Florida market, unless local production is inadequate, and given the exclusive domain of the Florida producers over Class I sales, out-of-state milk may not profitably serve the remainder of the Florida market, since it is relegated to the surplus market alone. These barriers are precisely the kind of hindrance to the introduction of milk from other States which Baldwin condemned as an 'unreasonable clog upon the mobility of commerce. They set up what is equivalent to a rampart of customs duties designed to neutralize advantages belonging to the place of origin. They are thus hostile in conception as well as burdensome in result.' 294 U.S., at 527, 55 S.Ct., at 502, 79 L.Ed. 1032.
20
The exclusion of foreign milk from a major portion of the Florida market cannot be justified as an economic measure to protect the welfare of Florida dairy farmers or as a health measure designed to insure the existence of a wholesome supply of milk. This much Baldwin and Dean made clear. Nor is it an escape from Baldwin to say that Polar has no interest in providing a satisfactory blend price as a basis for ongoing relationships with any out-of-state producer and that its only interest is in buying surplus milk at distress prices from out-of-state sources and selling it at Class I prices in the Florida market, all to the detriment of Florida producers and an orderly market. For this is but another assertion that a State may preempt its market for its own producers to the exclusion of production from other areas. Florida has no power 'to prohibit the introduction within her territory of milk of wholesome quality acquired (in another state), whether at high prices or at low ones,' 294 U.S. 521, 55 S.Ct. 499, 79 L.Ed. 1032; the State may not, in the sole interest of promoting the economic welfare of its dairy farmers, insulate the Florida milk industry from competition from other States.
21
Florida, it is true, does not prevent distributors located in other States from selling wholesome fluid milk in the Florida market. But allowing competition on the distributor level is no justification for barring interstate milk from the most lucrative segment of Florida's raw milk market. Given such distributor competition as there is,11 there is still milk in other States which Polar can and wants to acquire and which it will not acquire in the face of the Florida regulations. The burden on commerce and the embargo on out-of-state milk remain.
22
The cases relied upon by the Commission do not save the regulatory scheme challenged here. Nebbia v. New York, 291 U.S. 502, 54 S.Ct. 505, 78 L.Ed. 940, established that minimum retail and wholesale prices for milk purchased and sold within the State do not offend the Due Process and Equal Protection Clauses. Nor is such price regulation an impermissible burden upon commerce, Highland Farms Dairy v. Agnew, 300 U.S. 608, 57 S.Ct. 549, 81 L.Ed. 835, even as applied to a distributor who purchases and cools milk within the State and then transports it to another State for processing and sale, since the burden on commerce is indirect and only incidental to the regulation of an essentially local activity. Milk Control Board of Pennsylvania v. Eisenberg Farm Products, 306 U.S. 346, 59 S.Ct. 528, 83 L.Ed. 752. In none of these cases was there any attempt to reserve a local market for local producers or to protect local producers from out-of-state competition by means of purchase and allocation requirements imposed upon milk distributors.
23
The power which we deny to Florida is reserved to Congress under the Commerce Clause, and we are offered nothing indicating either congressional consent to, or acquiescence in, a regulatory scheme such as Florida has employed. On the contrary, under the present Act authorizing federal marketing orders in the milk industry, such an order may not 'prohibit or in any anner limit, in the case of the products of milk, the marketing * * * of any milk or product thereof produced in any production area in the United States.' This provision, as the Court explained in Lehigh Valley Cooperative v. United States, 370 U.S. 76, 82 S.Ct. 1168, 8 L.Ed.2d 345, was intended to prevent the Secretary of Agriculture from setting up trade barriers to the importation of milk from other production areas in the United States. We seriously doubt that Congress, in denying the power to the Secretary, thereby granted it to the States.
III.
24
We turn to the matter of Polar's sales to United States military reservations. Florida does not purport to regulate the price which Polar must charge for milk sold to the Government on or off military bases. Florida regulates only the price which Polar must pay for its milk, not what it must sell it for. Since the holding in Paul v. United States, 371 U.S. 245, 83 S.Ct. 426, 9 L.Ed.2d 292, dealt only with the conflict between federal procurement regulations and a State's attempt to prescribe the prices which a distributor must charge for milk sold to the United States, it is not applicable here. Likewise, because Florida regulates only producer prices applicable to sales made by producers to the distributor, none of which occur on military bases, its law is not vulnerable as an attempt to legislate with regard to transactions occurring within federal enclaves subject to the exclusive jurisdiction of the United States. Cf. Standard Oil v. California, 291 U.S. 242, 54 S.Ct. 381, 78 L.Ed. 775, and James v. Dravo Contracting Co., 302 U.S. 134, 58 S.Ct. 208, 82 L.Ed. 155.
25
However, in the Paul case the United States initially attacked California's producer prices, along with its distributor prices, as in conflict with federal procurement regulations, an issue which was abandoned in this Court and which was expressly saved in the Court's opinion. It is that issue which Polar now presents to us.
26
For good reason we again put off decision of this question to another day. At the outset of this litigation, the trial court temporarily enjoined the application to Polar of a Milk Commission order establishing prices to be paid Florida producers for milk to be sold to military installations and requiring purchases of such milk from designated producers. That order, however, was voted down by the Pensacola producers, leaving considerable confusion, amply demonstrated by the record before us, concerning the status of so-called military milk under the outstanding orders of the Commission. It would seem—although we are not sure, and there were no findings below about these matters—that military milk is Class I milk but that Polar nevertheless need not use Pensacola milk for military sales and is free to purchase out-of-state milk for this purpose, although if it does use milk purchased from its earned-base producers, it must pay 61 cents per gallon for it. It was apparent from the oral argument that Polar and the Commission were in dispute as to the impact of the existing regulations upon military sales, and we would hesitate to adjudicate the issue tendered in the absence of more helpful testimony and additional consideration of the matter in the court below, particularly since it is not at all clear that Polar has been using Pensacola milk for its military sales, or even that it wants to in the future. If it is free to utilize outside milk, acquired at whatever price, it may not want to pursue the matter at all. Besides, Polar is obtaining a substantial percentage of its total needs from outside the State and the production of Polar's Pensacola producers may be wholly exhausted by other, nonmilitary, uses to which it may be put.
27
Moreover, consideration of the possible impact of producer-pricing systems upon federal procurement regulations may be premature at this time, in view of our invalidation of other provisions of the Florida law, provisions not entirely unrelated to the issue of military milk. The whole problem of military sales may take on a different aspect upon remand of this case.
IV.
28
Polar challenges that provision of the Florida Milk Control Act which imposes a tax in the amount of 15/100 of 1 cent upon each gallon of milk distributed by a Florida distributor. To the extent the computation of the tax includes milk which it sells to Fort Benning, Tyndall Air Force Base, and the Pensacola Naval Air Station, all being federal enclaves over which the United States exercises exclusive jurisdiction, Polar argues that the taxing measure is invalid as beyond the jurisdiction of the State to impose. We do not agree.
29
Polar's reliance on James v. Dravo Contracting Co., 302 U.S. 134, 58 S.Ct. 208, 82 L.Ed. 155, and Standard Oil v. California, 291 U.S. 242, 54 S.Ct. 381, 78 L.Ed. 775, is misplaced. The James case dealt with a 2% gross receipts tax levied upon every person engaging in the business of contracting within the State, as applied to a contractor undertaking construction of locks and dams for the United States in certain navigable streams. The Court denied West Virginia's jurisdiction to assess a grossreceipts tax with respect to work done by the contractor at its plants in Pennsylvania, as well as to work done within the exterior limits of West Virginia on property over which the United States had acquired exclusive jurisdiction. In Standard Oil v. California, California undertook to lay an excise tax upon every gasoline distributor for each gallon of motor vehicle fuel 'sold and delivered by him in this State.' The Court found the tax invalid where both sale and delivery occurred within the boundaries of the Presidio of San Francisco, a federal enclave over which the United States exercised exclusive jurisdiction.
30
In these cases the tax was deemed to fall upon the facilities of the United States or upon activities conducted within these facilities, the principle of both cases being that there was nothing occurring within the State, beyond the borders of the federal enclave, to which the tax could attach. Contrariwise, the Florida tax is on the privilege of engaging in the business of distributing milk or acting as a distributor; a distributor is defined as 'any milk dealer who operates a milk gathering station or processing plant where milk is collected and bottled or otherwise processed and prepared for sale.' Fla.Stat. § 501.02, F.S.A. The incidence of the tax appears to be upon the activity of processing or bottling milk in a plant located within Florida, and not upon work performed on a federal enclave or upon the sale and delivery of milk occurring within the boundaries of federal property. Standard Oil and Dravo do not reach this case, for the activity Florida taxes—the processing or bottling of milk—occurs at Polar's plant prior to the sale and delivery of milk to the Government.12
31
It may be urged that a distributor is a dealer13 and that a dealer is one who sells milk, including one who sells to and upon federal enclaves. But even so, distributing has, by definition, its processing dimension, a substantial activity occurring within Florida. This is enough to sustain the tax. Besides, 4 U.S.C. § 105, enacted subsequent to James and Standard Oil, supra, confers upon the States jurisdiction to levy and collect a sales or use tax 'in any Federal area,' and a sales or use tax is defined as 'any tax levied on, with respect to, or measured by, sales * * * of tangible personal property * * *' 4 U.S.C. § 110. We think this provision provides ample basis for Florida to levy a tax measured by the amount of milk Polar distributes monthly, including milk sold to the United States for use on federal enclaves in Florida.
32
The judgment is reversed and the case is remanded for further proceedings consistent with this opinion. It is so ordered.
33
Judgment reversed and case remanded.
1
Chapter 501 of the Florida Statutes establishes a comprehensive scheme for regulation of the milk industry and establishes the Florida Milk Commission. The Act empowers the Commission, inter alia, to supervise and regulate the entire milk industry, including the production, transportation, manufacture, storage, distribution and sale of milk, to establish milk markets within the State, to fix prices to be paid producers within a regulated marketing area by distributors, milk dealers and producer-distributors, and generally to adopt and enforce all rules, regulations, and orders necessary to carry out the purposes of the Act. Fla.Stat. § 501.04, F.S.A. In addition the Commission is authorized to revoke or suspend the license of a milk distributor or dealer when satisfied that the dealer or distributor has rejected or refused milk delivered by a producer in ordinary continuance of a previous course of dealings or when satisfied that the dealer or distributor has committed any act injurious to the public health or public welfare in demoralization of the price structure of pure milk to such an extent as to interfere with an ample supply. Fla.Stat. §§ 501.09(3)(a), (c), F.S.A. Before the Commission may exercise its supervisory and regulatory powers in any marketing area, however, at least 10% of the producers in that area must petition the Commission for such regulation and a majority of the producers in that area must vote in favor of regulation. Fla.Stat. § 501.20(1), F.S.A.
In November 1961, the dairy farmers producing milk in the four westernmost Florida counties, Escambia, Santa Rosa, Okaloosa and Walton, voted to place that a ea under the control of the Florida Milk Commission and thereby subject to the provisions of the Florida Milk Control Act and the orders issued pursuant thereto. Thereupon in January 1962, the Commission issued a series of orders covering the four-county area, termed the Pensacola Milk Marketing Area, and a letter to Polar Ice Cream & Creamery Co. specifying its obligations under the newly imposed regulatory structure. In August 1962, the Commission issued other orders and rules further implementing and defining the earned-base allocation plan challenged herein.
2
The minimum price established in Official Order PEN—4, January 18, 1962, for the Pensacola area for Class II milk was 1 cent per gallon less than the minimum price established for this class milk in the Miami, Florida, Federal Milk Marketing Order, No. 118, and for Class III milk was 26 cents per gallon. There was no price set for Class IV utilization in this order. Official Order No. 20—29, covering all regulated marketing areas in Florida, effective March 4, 1962, retained the 61 cents per gallon minimum on Class I milk, and adopted the monthly prices in the Miami, Florida, Federal Milk Marketing Order, less 1 cent per gallon, for Class II, III and IV milk. All of the above prices are subject to minor adjustments for variations from the 4% average butterfat content of the milk distributed in each class.
Classes of milk are defined as follows in Official Order No. 20—28:
'IT IS HEREBY ORDERED THAT:
'1. CLASS 1 MILK is hereby defined as all fluid milk or milk products sold in fluid form with the exception of buttermilk, chocolate drink and cream.
'2. CLASS II MILK shall be all skim milk and butterfat:
'(a) Used to produce acidophilus milk, buttermilk, chocolate drink, half and half, light cream, heavy cream and sour cream, and
'(b) Contained in inventories in the form of milk products designated as Class I milk pursuant to paragraph (1) of this section on hand at the end of each month and accounting period; provided, that Class II classification of shrinkage prorated to skim and butterfat, respectively, in producer milk shall not exceed two per cent (2%) of skim and butterfat in producer milk.
'3. CLASS III MILK shall be all skim milk and butterfat:
'(a) Used to produce any product other than those specified in paragraphs (1) and (2) of this section;
'(b) That portion of fortified milk or skim milk not classified as Class I milk pursuant to subparagraph (1)(a) of this section, and
'(c) In total shrinkage of skim milk and butterfat, respectively, such shrinkage to be prorated to producer milk and other source milk received in the form of fluid milk or skim milk.
'4. CLASS IV MILK shall be all milk the skim portion of which is:
'(a) Disposed of for fertilizer or livestock feed, and
'(b) Dumped after such prior notification as the Commission administrator may require.'
3
Milk utilized by the consumer in fluid form, beverage milk, commands a substantially higher price than milk of the identical quality which is used to make manufactured milk products, such as butter, cheese, ice cream and so forth. Accordingly the processor or distributor of milk is able to pay the producer a higher price for milk which is sold in fluid form for human consumption, and most milk-pricing systems require milk to be classified according to use. See Lehigh Valley Co-operative v. United States, 370 U.S. 76, 79, 82 S.Ct. 1168, 1170, 8 L.Ed.2d 345. The milk industry generally maintains a reserve to meet the changing demands for beverage milk. Since the supply of milk is greater than the demands of the fluid milk market, the excess, referred to as surplus milk, must be channeled to the less-desirable, lower-priced outlets. This explains how Polar is able to purchase milk in Alabama and other States for as low as 30 and 35 cents per gallon and how Polar was able to pay its producers, prior to regulation, as high as 61 cents per gallon for a specified quantity of milk.
Where a distributor sells milk in both fluid and manufactured forms, problems of allocation arise. Under Federal Milk Marketing Orders establishing marketwide pools, the total proceeds received from the sale of milk by regulated handlers or distributors are pooled. A 'blend' or average price is calculated by multiplying the 'pool' milk disposed of in each class by the established minimum prices for each class, with some further adjustments not pertinent here. See Lehigh Valley Cooperative, supra, at 370 U.S. at 80, 82 S.Ct. at 1170—1171, 8 L.Ed.2d 345. The 'blend' price is then divided among the producers according to the amount of milk each producer sells, regardless of the use to which his milk is actually put. The blend price thus represents an average based upon the combined use of all regulated milk within a marketing area.
4
Until the Florida Milk Commission's Rule 220—1.05 was promulgated on August 24, 1962, the applicability of the allocation provision to milk utilized in less than Class I channels was unclear. The Commission's letter of January 25, 1962, to Polar's earned-base producers, assigning them bases for 1962, specified that the bases entitled them to that percentage of Polar's Class I milk sales each month, without referring to Class II, III or IV utilizations. The total of the percentages assigned to these 26 producers was 100%, thus entitling them collectively to all of Polar's Class I sales for 1962.
Rule 220—1.05(6) provides:
'BASE PERCENTAGE; COMPUTATION AND APPLICATION.
'(a) During the base fixing period, a base percentage shall be determined for each producer by calculating the ratio of the milk delivered by each producer to the total milk delivered by all producers for the entire base fixing period, which percentage is referred to herein as 'earned base.' This computation shall be made immediately following the close of the base fixing period, and within thirty (30) days thereafter, each producer shall be notified by mail of his base percentage and the base percentage of all other producers participating in that particular base. During this period, each plant shall supply the local Deputy Administrator with a summary of its base computations. The producer notification must illustrate how the base percentage for the producer concerned has been determined.
'1. The base percentage earned by each producer shall be applied to the total number of gallons of milk utilized in Class I channels by each distributor and producer-distributor to determine the number of gallons of milk for which the producer must be paid at the Class I price fixed by the Commission. In case a producer fails to produce the amount of milk that his 'earned base' entitles him to, in Class I channels, such deficit must be reallocated to the other 'earned base' producers in proportion to their 'earned bases,' and the Class I price paid for the milk so reallocated.
'2. The method outlined above for computing allocations to Class I utilization shall be followed in computing allocations for all other classes.
'3. First allocation of a producer's deliveries shall be to Class I utilization, with allocation continued thereafter in descending order of price through Class IV classification. The balance of any producer's production after the above allocations may then be placed in the lowest price classification.
'4. In computing Class I sales to be allocated to producers, no adjustment shall be made for milk received by distributors and/or producer-distributors from sources other than 'earned base' producers.'
5
Section 501.05(3) provides:
'The relationship between a producer and a distributor, under which milk produced by the producer is regularly delivered to and accepted by the distributor, when once established, shall not be terminated either by the producer or by the distributor without just cause therefor, and the approval of the commission. Just cause will be considered by the commission as any cause deemed just by a prudent and reasonable man.'
Section 501.09(3) provides: 'The commission may decline to grant any license * * * or revoke a license * * * when satisfied of the existence of any of the following * * *
'(a) That a milk dealer has rejected, without reasonable cause, any milk delivered to and accepted by the milk dealer from a producer delivered by or on behalf of the producer in ordinary continuance of a previous course of dealing, or that a milk dealer has rejected without reasonable cause, or has rejected without reasonable advance notice, any milk tendered or offered for delivery to the milk dealer by or on behalf of a producer in ordinary continuance of a previous course of dealing. It is intended hereby to provide and require that a milk dealer shall not reject or refuse to accept any milk tendered or offered for delivery by or on behalf of a producer in ordinary continuance of a previous course of dealing unless there exists reasonable cause for the rejection or refusal to accept such milk and unless the milk dealer has also given * * * advance notice * * *.'
6
In Borden Co. v. Odham, 121 So.2d 625, the Florida Supreme Court upheld the Commission's power to apply the percentage allocation provisions to Class II and III as well as Class I milk and to require a distributor to accept milk in excess of Class I requirements, so long as the Commission acted reasonably. However, since the statute at that tim only required reasonable notice for a refusal of milk delivered in the ordinary course of dealings between a distributor and producer, the court held that the Commission's additional requirement of just cause was beyond its authority. The statute, note 5, supra, has subsequently been amended to require both just cause and reasonable notice before refusal or rejection of milk delivered by an earned-base producer is permissible.
In Florida Dairy, Inc., v. Florida Milk Comm., Fla.App., 149 So.2d 867, a milk distributor sought to terminate its relationship with producers on the ground that it could produce its own milk at a lower price than that paid to producers and that the required prices rendered the distributor unable to meet the competition from producer-distributors in its area. The Commission's finding that just cause was not met by this showing because of the injury to producers that would result from the termination and the consequent loss of business was upheld. See Foremost Dairies v. Odham, Fla., 121 So.2d 636, upholding over Commerce Clause objections a Commission order providing for an annual base-fixing period and providing that base percentages earned by each producer are applicable to all classes of milk.
Mr. E. V. Fisher, Administrator of the Florida Milk Commission, testified below that Polar is required to accept all the milk produced and tendered by Polar's earned-base producers, and that refusal of any milk tendered without just cause is ground for a show-cause order and disciplinary proceedings. And see Rule 220—1.05(4), (6).
Official Order PEN—2, however, provides that an earned-base producer who delivers milk in excess of Class I needs during the base-fixing period may have his subsequent earned-base reduced; this order is to discourage Pensacola producers from increasing their production to the point of supplying surplus milk, defined as milk in excess of Class I needs.
7
In the court below and in the jurisdictional statement filed with this Court, Polar also objected that this regulatory structure violated the due process and equal protection of the laws provisions of the Fourteenth Amendment. However, Polar has not pursued these issues in its brief or argument before this Court. They appear on their face to be without merit, and, in any case, our resolution of the other claims asserted renders a decision on these issues unnecessary.
8
Fla.Stat. §§ 501.09(4)(b), 501.09(8), F.S.A.:
'For the privilege of continuing in or engaging in the business of distributing milk or acting as a distributor under the provisions of this chapter, there is imposed upon every distributor a tax in an amount equal to fifteen-one hundredths of one cent upon each gallon of milk distributed by each distributor during each calendar month. The amount of such tax shall be remitted by each distributor to the commission at the time that the monthly reports are required to be filed by the distributor with the commission as provided by this chapter.'
'If at any time during a fiscal year the revenues received by the commission under this chapter exceed by at least twenty-five per cent the total amount of expenditures as budgeted by the commission for that fiscal year, the payment of taxes provided for in this subsection, and in § 501.09(4), on milk distributed by distributors, will be discontinued and such taxes are not imposed for the calendar months remaining in that fiscal year commencing with the first calendar month following the time when such revenues so collected exceed by at least twenty-five per cent the total amount of expenditures so budgeted for that fiscal year.'
9
In response to the argument that New York's price requirements were necessary to enhance the economic welfare of Vermont farmers and thereby ensure their observance of sanitary and health requirements, the Court stated that 'the evils springing from uncared for cattle must be remedied by measures of repression more direct and certain than the creation of a parity of prices between New York and other states. * * * Whatever relation there may be between earnings and sanitation is too remote and indirect to justify obstructions to the normal flow of commerce in its movement between states.' 294 U.S. at 524, 55 S.Ct. at 501, 79 L.Ed. 1032. See Dean Milk Co. v. Madison, 340 U.S. 349, 71 S.Ct. 295, 95 L.Ed. 329, where a purported local health measure was invalidated because reasonable nondiscriminatory alternatives, adequate to conserve and protect local interests, were available.
10
The Florida Milk Commission has informed us that Florida producers would operate at a loss unless a proportion of their sales of milk were put to Class I use and that therein lies the purpose of the Class I purchase and allocation requirement. We do not see why the situation is different for non-Florida producers.
11
A recent study of movement patterns of fluid milk and milk products in the Southeastern States indicates that the quantity of fluid milk and other products from Grade A milk moving across state lines within this area was relatively small, and that among six States in the area, North Carolina, South Carolina, Georgia, Alabama, Tennessee and Florida, Florida had by far the highest percentage of fluid milk and milk products distributed in the same areas as processed. This percentage was 95%. Carley and Purcell, Milk Movement Patterns In The Southeast, 44 (So.Coop.Series, Bull. 84, April 1962).
Another study during sample months of 1959 shows that Florida producers supplied 99.3% of the market for fluid milk in Florida; for all markets, local producer shipments were in excess of 90% of total milk supplies received and that the remainder in each area was obtained from sources located in other Florida markets. Only in northwest Florida did receipts from other States amount to 2.6% of supplies. In no other area was this amount above 1% of total receipts. R. E. L. Greene and H. W. Wurburton, An Economic Evaluation of Fluid Milk Supply, Movement and Utilization in Florida, 61 (Dept. of Agricultural Economics, Fla. Agricultural Experiment Station).
12
It may be that the economic burden of the tax ultimately falls upon purchasers of Polar's milk, including the United States. Decisions of this Court make clear, however, that the fact that the economic burden of a tax may fall on the Government is not determinative of the validity of the tax. As was said in respect to a sales tax applied to materials, the cost of which the Government was obliged to pay:
'The Government, rightly we think, disclaims any contention that the Constitution, unaided by Congressional legislation, prohibits a tax exacted from the contractors merely because it is passed on economically, by the terms of the contract or otherwise, as a part of the construction cost to the Government. So far as such a non-discriminatory state tax upon the contractor enters into the cost of the materials to the Government, that is but a normal incident of the organization within the same territory of two independent taxing sovereignties. The asserted right of the one to be free of taxation by the other does not spell immunity from paying the added costs, attributable to the taxation of those who furnish supplies to the Government and who have been granted no tax immunity.' Alabama v. King & Boozer, 341 U.S. 1, 8—9, 62 S.Ct. 43, 45, 86 L.Ed. 3.
13
Fla.Stat. § 501.02, F.S.A. provides:
"Milk dealer' means any person who purchases or handles milk within the state, for sale in this state, or sells milk within the state in any market as defined in this chapter. Each corporation which if a natural person would be a milk dealer within the meaning of this chapter, and any subsidiary of such corporation, shall be deemed a milk dealer within the meaning of this definition. A producer who delivers milk only to a milk dealer shall not be deemed a milk dealer.'
| 78
|
375 U.S. 335
84 S.Ct. 363
11 L.Ed.2d 370
Walter HUMPHREY, etc., et al., Petitioners,v.C. W. MOORE, etc., et al. GENERAL DRIVERS, WAREHOUSEMEN AND HELPERS, LOCAL UNION NO 89, Petitioner, v. C. W. MOORE et al.
Nos. 17, 18.
Argued Oct. 16, 1963.
Decided Jan. 6, 1964.
Rehearing Denied Feb. 24, 1964.
See 376 U.S. 935, 84 S.Ct. 697.
David Previant, Milwaukee, Wis., and Mozart G. Ratner, Washington, D.C., for petitioners.
John Y. Brown, Louisville, Ky., and Newell N. Fowler, Memphis, Tenn., for respondents.
Mr. Justice WHITE delivered the opinion of the Court.
1
The issue here is whether the Kentucky Court of Appeals properly enjoined implementation of the decision of a joint employer-employee committee purporting to settle certain grievances in accordance with the terms of a collective bargaining contract. The decision of the committee determined the relative seniority rights of the employees of two companies, Dealers Transport Company of Memphis, Tennessee, and E & L Transport Company of Detroit, Michigan. We are of the opinion that the Kentucky court erred and we reverse its judgment.
2
Part of the business of each of these companies was the transportation of new automobiles from the assembly plant of the Ford Motor Company in Louisville, Kentucky. In the face of declining business resulting from several factors, the two companies were informed by Ford that there was room for only one of them in the Louisville operation. After considering the matter for some time, the two companies made these arrangements: E & L would sell to Dealers its 'secondary' authority out of Louisville, the purchase price to be a nominal sum roughly equal to the cost of effecting the transfer of authority; E & L would also sell to Dealers its authority to serve certain points in Mississippi and Louisiana; and Dealers would sell to E & L its initial authority out of Lorain, Ohio, along with certain equipment and terminal facilities. The purpose of these arrangements was to concentrate the transportation activities of E & L in the more northerly area and those of Dealers in the southern zone. The transfers were subject to the approval of regulatory agencies.
3
The employees of both Dealers and E & L were represented by the same union, General Drivers, Warehousemen and Helpers, Local Union No. 89. Its president, Paul Priddy, as the result of inquiry from E & L by his assistant, understood that the transaction between the companies involved no trades, sales, or exchanges of properties but only a withdrawal by E & L at the direction of the Ford Motor Company. He consequently advised the E & L employees that their situation was precarious. When layoffs at E & L began three E & L employees filed grievances claiming that the seniority lists of Dealers and E & L should be 'sandwiched' and the E & L employees be taken n at Dealers with the seniority they had enjoyed at E & L. The grievances were placed before the local joint committee, Priddy or his assistant meanwhile advising Dealers employees that they had 'nothing to worry about' since E & L employees had no contract right to transfer under these circumstances.
4
The collective bargaining contract involved covered a multi-employer, multi-local union unit negotiated on behalf of the employers by Automobile Transporters Labor Division and on behalf of the unions by National Truckaway and Driveaway Conference. Almost identical contracts were executed by each company in the unit and by the appropriate local union. According to Art. 4, § 1 of the contract 'seniority rights for employees shall prevail' and 'any controversy over the employees' standing on such lists shall be submitted to the joint grievance procedure. * * *' Section 5 of the same article, of central significance here, was as follows:
5
'In the event that the Employer absorbs the business of another private, contract or common carrier, or is a party to a merger of lines, the seniority of the employees absorbed or affected thereby shall be determined by mutual agreement between the Employer and the Unions involved. Any controversy with respect to such matter shall be submitted to the joint grievance procedure.'
6
Article 7 called for grievances to be first taken up between the employer and the local union and, if not settled, to be submitted to the local joint committee where the union and the employer were to have equal votes. Failing settlement by majority vote of the members of the local committee, the matter could be taken to the Automobile Transporters Joint Conference Committee upon which the employers and the unions in the overall bargaining unit had an equal number of representatives. Decisions of the Joint Conference Committee were to be 'final and conclusive and binding upon the employer and the union, and the employees involved.' However, if the Joint Conference Committee was unable to reach a decision the matter was to be submitted to arbitration as provided in the contract.
Article 7 also provided that:
7
(d) 'It is agreed that all matters pertaining to the interpretation of any provision of this Agreement, whether requested by the Employer or the Union, must be submitted to the full Committee of the Automobile Transporters Joint Conference Committee, which Committee, after listening to testimony on both sides, shall make a decision.' Other provisions of the contract stated that it was 'the intention of the parties to resolve all questions of interpretation by mutual agreement' and that the employer agreed 'to be bound by all of the terms and provisions of this Agreement, and also agrees to be bound by the interpretations and enforcement of the Agreement.'
8
The grievances of the E & L employees were submitted directly to the local joint committee and endorsed 'Deadlocked to Detroit for interpretation' over the signatures of the local union president and the Dealers representative on the committee. Later, however, the local union, having been more fully advised as to the nature of the transaction between the two companies, decided to recommend to the Joint Conference Committee that the seniority lists of the two companies be dovetailed and the E & L employees be employed at Dealers with seniority rights based upon those which they had enjoyed at E & L. The three shop stewards who represented the Dealers employees before the Joint Conference Committee meeting in Detroit were so advised by the union immediately prior to the opening of the hearing. After hearing from the company, the union and the stewards representing Dealers employees, the Joint Conference Committee thereupon determined that 'in accordance with Article 4 and particularly sub-sections 4 and 5' of the agreement the employees of E & L and of Dealers should 'be sandwiched in on master seniority boards using the presently constituted seniority lists and the dates contained therein * * *.'
9
Since E L was an older company and most of its employees had more seniority than the Dealers employees, the decision entailed the layoff of a large number of Dealers employees to provide openings for the E & L drivers.
10
Respondent Moore, on behalf of himself and other Dealers employees, then brought this class action in a Kentucky state court praying for an injunction against the union and the company to prevent the decision of the Joint Conference Committee from being carried out. Damages were asked in an alternative count and certain E & L employees were added as defendants by amendment to the complaint.1 The complaint alleged that Dealers employees had relied upon the union to represent them, that the president of Local 89, Paul Priddy, assured Dealers employees that they had nothing to worry about and that precedent in the industry provided that when a new business is taken over, its employees do not displace the original employees of the acquiring company; it further alleged that Priddy had deliberately 'deadlocked' the local joint committee and that the Dealers employees learned for the first time before the Joint Conference Committee in Detroit, that Priddy favored dovetailing the seniority lists. Priddy's actions, the complaint went on, 'in deceiving these plaintiffs as to his position left them without representation before the Joint Conference Committee.' The decision, according to the complaint, was 'contrived, planned and brought about by Paul Priddy' who 'has deceived and failed completely to represent said employees' and whose 'false and deceitful action' and 'connivance * * * with the employees of E & L' threatened the jobs of Dealers employees. The International union is said to have 'conspired with and assisted the defendant, Local No. 89, and its president, Paul Priddy, in bringing about this result * * *.' The decision of the Joint Conference Committee was charged to be arbitrary and capricious, contrary to the existing practice in the industry and violative of the collective bargaining contract.
11
After hearing, the trial court denied a temporary and permanent injunction.2 The Court of Appeals of the Commonwealth of Kentucky reversed and granted a permanent injunction, two judges dissenting. 356 S.W.2d 241. In the view of that court, Art. 4, § 5 could have no application to the circumstances of this case since it came into play only if the absorbing company agreed to hire the employees of the absorbed company. The clause was said to deal with seniority, not with initial employment. Therefore, it was said, the decision of the Joint Conference Committee was not binding because the question of employing E & L drivers was not 'arbitrable' at all under this section. The Court of Appeals, however, went on to hold that even if it were otherwise, the decision could not stand since the situation involved antagonistic interests of two sets of employees represented by the same union advocate. The result was inadequate representation of the Dealers employees in a context where Dealers itself was essentially neutral. Against such a backdrop, the erroneous decision of the board became 'arbitrary and violative of natural justice.' Kentucky cases were cited and relied upon. We granted both the petition filed by the E & L employees in No. 17 and the petition in No. 18, filed by the local union. 371 U.S. 966, 967, 83 S.Ct. 549, 9 L.Ed.2d 537.
I.
12
Since issues concerning the jurisdiction of the courts and the governing law are involved, it is well at the outset to elaborate upon the statement of the Kentucky court that this is an action to enforce a collective bargaining contract, an accurate o servation as far as we are concerned.
13
First, Moore challenges the power of the parties and of the Joint Conference Committee to dovetail seniority lists of the two companies because there was no absorption here within the meaning of s 5 of Art. 4 and because, as the court below held, that section granted no authority to deal with jobs as well as seniority. His position is that neither the parties nor the committee has any power beyond that delegated to them by the precise terms of § 5. Since in his view the Joint Committee exceeded its power in making the decision it did, the settlement is said to be a nullity and his impending discharge a breach of contract.
14
Second, Moore claims the decision of the Committee was obtained by dishonest union conduct in breach of its duty of fair representation and that a decision so obtained cannot be relied upon as a valid excuse for his discharge under the contract. The undoubted broad authority of the union as exclusive bargaining agent in the negotiation and administration of a collective bargaining contract is accompanied by a responsibility of equal scope, the responsibility and duty of fair representation. Syres v. Oil Workers Intern. Union, 350 U.S. 892, 76 S.Ct. 152, 100 L.Ed. 785, reversing 5 Cir., 223 F.2d 739; Brotherhood of Railroad Trainmen v. Howard, 343 U.S. 768, 72 S.Ct. 1022, 96 L.Ed. 1283; Tunstall v. Brotherhood of Locomotive Firemen & Enginemen, 323 U.S. 210, 65 S.Ct. 235, 89 L.Ed. 187; Steele v. Louisville & N.R. Co., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173. 'By its selection as bargaining representative, it has become the agent of all the employees, charged with the responsibility of representing their interests fairly and impartially.' Wallace Corp. v. National Labor Relations Board, 323 U.S. 248, 255, 65 S.Ct. 238, 241, 89 L.Ed. 216. The exclusive agent's obligation 'to represent all members of an appropriate unit requires (it) to make an honest effort to serve the interests of all of those members, without hostility to any. * * *' and its powers are 'subject always to complete good faith and honesty of purpose in the exercise of its discretion.' Ford Motor Co. v. Huffman, 345 U.S. 330, 337—338, 73 S.Ct. 681, 686, 97 L.Ed. 1048.
15
In the complaint which Moore filed here, the union is said to have deceived the Dealers employees concerning their job and seniority rights, deceitfully connived with the E & L drivers and with the International union to deprive Moore and others of their employment rights and prevented the latter from having a fair hearing before the Joint Committee by espousing the cause of the rival group of drivers after having indicated that the interests of the men at Dealers would be protected by the union. These allegations are sufficient to charge a breach of duty by the union in the process of settling the grievances at issue under the collective bargaining agreement.
16
Both the local and international unions are charged with dishonesty, and one-half of the votes on the Joint Committee were cast by representatives of unions affiliated with the international. No fraud is charged against the employer; but except for the improper action of the union, which is said to have dominated and brought about the decision, it is alleged that Dealers would have agreed to retain its own employees. The fair inference from the complaint is that the employer considered the dispute a matter for the union to decide. Moreover, the award had not been implemented at the time of the filing of the complaint, which put Dealers on notice that the union was charged with dishonesty and a breach of duty in procuring the decision of the Joint Committee. In these circumstances, the allegations of the complaint, if proved, would effectively undermine the decision of the Joint Committee as a valid basis for Moore's discharge.3
17
For these reasons this action is one arising under § 301 of the Labor Management Relations Act4 and is a case controlled by federal law, Textile Workers Union of America v. Lincoln Mills, 353 U.S. 448, 77 S.Ct. 912, 1 L.Ed.2d 972, even though brought in the state court. Local 174, Teamsters, etc. v. Lucas Flour Co., 369 U.S. 95, 82 S.Ct. 571, 7 L.Ed.2d 593; Smith v. Evening News Assn., 371 U.S. 195, 83 S.Ct. 267, 9 L.Ed.2d 246. Although there are differing views on whether a violation of the duty of fair representation is an unfair labor practice under the Labor Management Relations Act,5 it is not necessary for us to resolve that difference here. Even if it is, or arguably may be, an unfair labor practice, the complaint here alleged that Moore's discharge would violate the contract and was therefore within the cognizance of federal and state courts, Smith v. Evening News Assn., supra, subject, of course, to the applicable federal law.6
18
We now come to the merits of this case.
II.
19
If we assume with Moore and the courts below that the Joint Conference Committee's power was circumscribed by § 57 and that its interpretation of the section is open to court review, Moore's cause is not measurably advanced. For in our opinion the section reasonably meant what the Joint Committee said or assumed it meant. There was an absorption here within the meaning of the section and that section did deal with jobs as well as with seniority.8
20
Prior to this transaction both E & L and Dealers were transporting new cars out of Louisville for the Ford Motor Company. Afterwards, only one company enjoyed this business, and clearly this was no unilateral withdrawal by E & L. There was an agreement between the companies, preceded by long negotiation. E & L's authority to engage in the transportation of new cars out of Louisville was sold to Dealers. The business which E & L had done in that city was henceforth to be done by Dealers. While there was no sale of tangible assets at that location, the Joint Conference Committee reasonably concluded that there was an absorption by Dealers of the E & L business within the meaning of § 5 of the contract.
21
It was also permissible to conclude that § 5 dealt with employment as well as seniority. Mergers, sales of assets and absorptions are commonplace events. It is not unusual for collective bargaining agreements to deal with them, especially in the transportation industry where the same unions may represent the employees of both parties to the transaction.9 Following any of such events, the business of the one company will probably include the former business of the other; and the recurring question is whether it is the employees of the absorbed company or those of the acquiring company who are to have first call upon the available work at the latter concern. Jobs, as well as seniority, are at stake; and it was to solve just such problems that § 5 was designed. Its interpretation should be commensurate with its purposes.
22
Seniority has become of overriding importance, and one of its major functions is to determine who gets or who keeps an available job. Here § 5 provided for resolving the seniority of not only those employees who are 'absorbed,' but all who were 'affected' by the absorption. Certainly the transaction 'affected' the E & L employees; and the seniority of these drivers, which the parties or the Joint Conference Committee could determine, was clearly seniority at Dealers, the company which had absorbed the E & L business. The parties very probably, therefore, intended the seniority granted an E & L employee at Dealers to carry the job with it, just as seniority usually would. If it did not and if Dealers unilaterally could determine whether to hire any E & L employee, it might decide to hire none, excluding E & L employees from any of the work which they had formerly done. Or if it did hire E & L employees to fill any additional jobs resulting from the absorption of the E & L business, it might select E & L employees for jobs without regard to length of service at E & L or it might insi t on an agreement from the union to grant only such seniority as might suit the company. Section 5 would be effectively emasculated.
23
The power of the Joint Conference Committee over seniority gave it power over jobs. It was entitled under § 5 to integrate the seniority lists upon some rational basis, and its decision to integrate lists upon the basis of length of service at either company was neither unique nor arbitrary. On the contrary, it is a familiar and frequently equitable solution to the inevitably conflicting interests which arise in the wake of a merger or an absorption such as occurred here.10 The Joint Conference Committee's decision to dovetail seniority lists was a decision which § 5 empowered the committee to make.
24
Neither do we find adequate support in this record for the complaint's attack upon the integrity of the union and of the procedures which led to the decision. Although the union at first advised the Dealers drivers that they had nothing to worry about but later supported the E & L employees before the Joint Conference Committee, there is no substantial evidence of fraud, deceitful action or dishonest conduct. Priddy's early assurances to Dealers employees were not well founded, it is true; but Priddy was acting upon information then available to him, information received from the company which led him to think there was no trade or exchange involved, no 'absorption' which might bring § 5 into play. Other sections of the contract, he thought, would protect the jobs of Moore and his fellow drivers.11 Consistent with this view, he also advised E & L employees that the situation appeared unfavorable for them. However, when he learned of the pending acquisition by Dealers of E & L operating authority in Louisville and of the involvement of other locations in the transaction, he considered the matter to be one for the Joint Committee. Ultimately he took the view that an absorption was involved, that § 5 did apply and that dovetailing seniority lists was the most equitable solution for all concerned. We find in this evidence insufficient proof of dishonesty or intentional misleading on the part of the union. And we do not understand the court below to have found otherwise.
25
The Kentucky court, however, made much of the antagonistic interests of the E & L and Dealers drivers, both groups being represented by the same union, whose president supported one group and opposed the other at the hearing before the Joint Conference Committee. But we are not ready to find a breach of the collective bargaining agent's duty of fair representation in taking a good faith position contrary to that of some individuals whom it represents nor in supporting the position of one group of employees against that of another. In Ford Motor Co. v. Huffman 345 U.S. 330, 73 S.Ct. 681, 97 L.Ed. 1048, the Court found no breach of duty by the union in agreeing to an amendment of an existing collective bargaining contract, granting enhanced seniority to a particular group of employees and resulting in layoffs which otherwise would not have occurred. 'Inevitably differences arise in the manner and degree to which the terms of any negotiated agreement affect individual employees and classes of employees. The mere existence of such differences does not make them invalid. The complete satisfaction of all who are represented is hardly to be expected. A wide range of reasonableness must be allowed a statutory bargaining representative in serving the unit it represents, subject always to complete good faith and honesty of purpose in the exercise of its discretion.' Id., 345 U.S. at 338, 73 S.Ct. at 686. Just as a union must be free to sift out wholly frivolous grievances which would only clog the grievance process, so it must be free to take a position on the not so frivolous disputes. Nor should it be neutralized when the issue is chiefly between two sets of employees. Conflict between employees represented by the same union is a recurring fact. To remove or gag the union in these cases would surely weaken the collective bargaining and grievance processes.
26
As far as this record shows, the union took its position honestly, in good faith and without hostility or arbitrary discrimination. After Dealers absorbed the Louisville business of E & L, there were fewer jobs at Dealers than there were Dealers and E & L drivers. One group or the other was going to suffer. If any E & L drivers were to be hired at Dealers either they or the Dealers drivers would not have the seniority which they had previously enjoyed. Inevitably the absorption would hurt someone. By choosing to integrate seniority lists based upon length of service at either company, the union acted upon wholly relevant considerations, not upon capricious or arbitrary factors. The evidence shows no breach by the union of its duty of fair representation.
27
There is a remaining contention. Even though the union acted in good faith and was entitled to take the position it did, were the Dealers employees, if the union was going to oppose them, deprived of a fair hearing by having inadequate representation at the hearing? Dealers employees had notice of the hearing, they were obviously aware that they were locked in a struggle for jobs and seniority with the E & L drivers, and three stewards representing them went to the hearing at union expense and were given every opportunity to state their position. Thus the issue is in reality a narrow one. There was no substantial dispute about the facts concerning the nature of the transaction between the two companies. It was for the Joint Conference Committee initially to decide whether there was an 'absorption' within the meaning of § 5 and, if so, whether seniority lists were to be integrated and the older employees of E & L given jobs at Dealers. The Dealers employees made no request to continue the hearing until they could secure further representation and have not yet suggested what they could have added to the hearing by way of facts or theory if they had been differently represented. The trial court found it 'idle speculation to assume that the result would have been different had the matter been differently presented.' We agree.
28
Moore has not, therefore, proved his case. Neither the parties nor the Joint Committee exceeded their power under the contract and there was no fraud or breach of duty by the exclusive bargaining agent. The decision of the committee, reached after proceedings adequate under the agreement, is final and binding upon the parties, just as the contract says it is. General Drivers, etc., Union v. Riss & Co., 372 U.S. 517, 83 S.Ct. 789, 9 L.Ed.2d 918.
29
The decision below is reversed and the cases are remanded for further proceedings not inconsistent with this opinion.
30
It is so ordered.
31
Reversed and remanded.
32
Mr. Justice GOLDBERG, with whom Mr. Justice BRENNAN joins, concurring in the result.
33
I concur in the judgment and in the holding of the Court that since 'Moore has not * * * proved his case * * *,' the decision below must be reversed. Supra. I do not, however, agree that Moore stated a cause of action arising under § 301(a) of the Labor Management Relations Act, 61 Stat. 156, 29 U.S.C. § 185(a). It is my view rather that Moore's claim must be treated as an individual employee's action for a union's breach of its duty of fair representation—a duty derived not from the collective bargaining contract but from the National Labor Relations Act, as amended, 61 Stat. 136, 29 U.S.C. § 141 et seq. See Syres v. Oil Workers Int'l Union, 350 U.S. 892, 76 S.Ct. 152, 100 L.Ed. 785, reversing 5 Cir., 223 F.2d 739; Brotherhood of Railroad Trainmen v. Howard, 343 U.S. 768, 72 S.Ct. 1022, 96 L.Ed. 1283; Tunstall v. Brotherhood of Locomotive Firemen & Enginemen, 323 U.S. 210, 65 S.Ct. 235, 89 L.Ed. 187; Steele v. Louisville & N.R. Co., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173. Cf. International Association of Machinists v. Central Airlines, Inc., 372 U.S. 682, 83 S.Ct. 956, 10 L.Ed.2d 67.
34
The complaint does not expressly refer either to § 301(a) of the Labor Management Relations Act or to the National Labor Relations Act as the source of the action. Since substance and not form must govern, however, we look to the allegations of the complaint and to the federal labor statutes to determine the nature of the claim.
35
The opinion of the Court correctly describes Moore's complaint as alleging that the decision of the Joint Conference Committee dovetailing the seniority lists of the two companies violated Moore's rights because: (1) the Joint Committee exceeded its powers under the existing collective bargaining contract in making its decision dovetailing seniority lists, and (2) the decision of the Committee was brought about by dishonest union conduct in breach of its duty of fair representation.
36
Neither ground, it seems to me, sustains an action under § 301(a) of the L.M.R.A. A mutually acceptable grievance settlement between an employer and a union, which is what the decision of the Joint Committee was, cannot be challenged by an individual dissenting employee under § 301(a) on the ground that the parties exceeded their contractual powers in making the settlement. It is true that this Court, in a series of decisions dealing with labor arbitrations, has recognized that the powers of an arbitrator arise from and are defined by the collective bargaining agreement.1 'For arbitration,' as the Court said in United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582, 80 S.Ct. 1347, 1353, 4 L.Ed.2d 1409, 'is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.' Thus the existing labor contract is the touchstone of an arbitrator's powers. But the power of the union and the employer jointly to settle a grievance dispute is not so limited. The parties are free by joint action to modify, amend, and supplement their original collective bargaining agreement. They are equally free, since '(t)he grievance procedure is * * * a part of the continuous collective bargaining process,' to settle grievances not falling within the scope of the contract. Id., 363 U.S. at 581, 80 S.Ct. at 1352. In this case, for example, had the dispute gone to arbitration, the arbitrator would have been bound to apply the existing agreement and to determine whether the mergerabsorption clause applied. However, even in the absence of such a clause, the contracting parties—the multiemployer unit2 and the union—were free to resolve the dispute by amending the contract to dovetail seniority lists or to achieve the same result by entering into a grievance settlement. The presence of the merger-absorption clause did not restrict the right of the parties to resolve their dispute by joint agreement applying, interpreting, or a ending the contract.3 There are too many unforeseeable contingencies in a collective bargaining relationship to justify making the words of the contract the exclusive source of rights and duties.
37
These principles were applied in Ford Motor Co. v. Huffman, 345 U.S. 330, 73 S.Ct. 681, 97 L.Ed. 1048. There the union and the employer during a collective bargaining agreement entered into a 'supplementary agreement' providing seniority credit for the pre-employment military service of veterans, a type of seniority credit not granted in the original agreement. Id., 345 U.S. at 334, n. 6, 73 S.Ct. at 684. Huffman, on behalf of himself and other union members whose seniority was adversely affected, brought suit to have the supplementary provisions declared invalid and to obtain appropriate injunctive relief against the employer and the union. There was no doubt that Huffman and members of his class were injured as a result of the 'supplementary agreement'; they were subjected to layoffs that would not have affected them if the seniority rankings had not been altered. Despite the change in rights under the prior agreement, this Court held that the existing labor agreement did not limit the power of the parties jointly, in the process of bargaining collectively, to make new and different contractual arrangements affecting seniority rights.
38
It necessarily follows from Huffman that a settlement of a seniority dispute, deemed by the parties to be an interpretation of their agreement, not requiring an amendment, is plainly within their joint authority. Just as under the Huffman decision an amendment is not to be tested by whether it is within the existing contract, so a grievance settlement should not be tested by whether a court could agree with the parties' interpretation. If collective bargaining is to remain a flexible process, the power to amend by agreement and the power to interpret by agreement must be coequal.
39
It i wholly inconsistent with this Court's recognition that '(t)he grievance procedure is * * * a part of the continuous collective bargaining process,' United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S., at 581, 80 S.Ct., at 1352, to limit the parties' power to settle grievances to the confines of the existing labor agreement, or to assert, as the Court now does, that an individual employee can claim that the collective bargaining contract is violated because the parties have made a grievance settlement going beyond the strict terms of the existing contract.
40
I turn now to the second basis of the complaint, viz., that the decision of the Joint Conference Committee was brought about by dishonest union conduct in breach of its duty of fair representation. In my view, such a claim of breach of the union's duty of fair representation cannot properly be treated as a claim of breach of the collective bargaining contract supporting an action under § 301(a). This is particularly apparent where, as here, '(n)o fraud is charged against the employer * * *.' Ante, at 343.
41
This does not mean that an individual employee is without a remedy for a union's breach of its duty of fair representation. I read the decisions of this Court to hold that an individual employee has a right to a remedy against a union breaching its duty of fair representation—a duty derived not from the collective bargaining contract but implied from the union's rights and responsibilities conferred by federal labor statutes. See Syres v. Oil Workers Int'l Union, supra (National Labor Relations Act); Brotherhood of Railroad Trainmen v. Howard, supra (Railway Labor Act); Tunstall v. Brotherhood of Locomotive Firemen & Enginemen, supra (Railway Labor Act); Steele v. Louisville & N.R. Co., supra (Railway Labor Act). Cf. International Association of Machinists v. Central Airlines, Inc., supra (Railway Labor Act). There is nothing to the contrary in Smith v. Evening News Assn., 371 U.S. 195, 83 S.Ct. 267, 9 L.Ed.2d 246. In that case the gravamen of the individual employee's § 301(a) action was the employer's discharge of employees in violation of the express terms of the collective bargaining agreement. No breach of the union's duty of fair representation was charged. To the contrary, the union supported the employee's suit which was brought as an individual suit out of obeisance to what the union deemed to be the requirements of Association of Westinghouse Salaried Employees v. Westinghouse Electric Corp., 348 U.S. 437, 75 S.Ct. 489, 99 L.Ed. 510.
42
The remedy in a suit based upon a breach of the union's duty of fair representation may be extended to the employer under appropriate circumstances. This was recognized in Steele v. Louisville & N.R. Co., supra, where the Court extended the remedy against the union to include injunctive relief against a contract between the employer and the union. There the employer willfully participated in the union's breach of its duty of fair representation and that breach arose from discrimination based on race, a classification that was held 'irrelevant' to a union's statutory bargaining powers. The Court observed:
43
'(I)t is enough for present purposes to say that the statutory power to represent a craft and to make contracts as to wages, hours and working conditions does not include the authority to make among members of the craft discriminations not based on * * * relevant differences.' Id., 323 U.S. at 203, 65 S.Ct. at 232.
44
The Court distinguished classifications and differences which are 'relevant to the authorized purposes of the contract * * * such as differences in seniority, the type of work performed, (and) the competence and skill with which it is performed, * * *' Ibid. Where the alleged breach of a union's duty involves a differentiation based on a relevant classification—in this case seniority rankings following an amalgamation of employer units—and where the employer has not willfully participated in the alleged breach of the union's duty, the collecti e bargaining agreement should not be open to the collateral attack of an individual employee merely because the union alone has failed in its duty of fair representation. We should not and, indeed, we need not strain, therefore, as the Court does, to convert a breach of the union's duty to individual employees into a breach of the collective bargaining agreement between the employer and the union.
45
I do not agree with the Court that employer willfulness was claimed in this case by '(t)he fair inference from the complaint' that Dealers 'considered the dispute a matter for the union to decide.' Ante, at 343. Nor can I agree that willfulness could be predicated on the rationale that since 'the award had not been implemented at the time of the filing of the complaint,' Dealers was 'put * * * on notice that the union was charged with dishonesty and a breach of duty in procuring the decision of the Joint Committee.' Ibid. Dealers may indeed have been neutral when the case was presented to the Joint Conference Committee but the Court overlooks that the employer-party to the collective bargaining contract was the multiemployer unit whose representatives—acting on behalf of both Dealers and E & L—fully participated in the Joint Committee's decision resolving the dispute.4 Furthermore, an employer not willfully participating in union misconduct should not be restrained from putting a grievance settlement into effect merely by being 'put * * * on notice' that an individual employee has charged the union with dishonesty. Such a rule would penalize the honest employer and encourage groundless charges frustrating joint grievance settlements. Finally, it is difficult to conceive how mere notice to an employer of union dishonesty can transform the union's breach of its duty of fair representation into a contractual violation by the employer.
46
In summary, then, for the reasons stated, I would treat Moore's claim as a Syres-Steele type cause of action rather than as a § 301(a) contract action. So considering it, I nevertheless conclude, as the Court does, that since 'there was no fraud or breach of duty by the exclusive bargaining agent,' ante, at 351, Moore is not entitled to the relief sought.
47
I have written at some length on what may seem a narrow point. I have done so because of my conviction that in this Court's fashioning of a federal law of collective bargaining, it is of the utmost importance that the law reflect the realities of industrial life and the nature of the collective bargaining process. We should not assume that doctrines evolved in other contexts will be equally well adapted to the collective bargaining process. Of course, we must protect the rights of the individual. It must not be forgotten, however, that many individual rights, such as the seniority rights involved in this case, in fact arise from the concerted exercise of the right to bargain collectively. Consequently, the understandable desire to protect the individual should not emasculate the right to bargain by placing undue restraints upon the contracting parties. Similarly, in safeguarding the individual against the misconduct of the bargaining agent, we must recognize that the employer's interests are inevitably involved whenever the labor contract is set aside in order to vindicate the individual's right against the union. The employer's interest should not be lightly denied where there are other remedies available to insure that a union will respect the rights of its constituents. Nor should trial-type hearing standards or conceptions of vested contractual rights be applied so as to hinder the employer and the union in their joint endeavor to adapt the collective bargaining relationship to the exigencies of economic life. I have deemed it necessary to state my views separately because I believe that the Court's analysis in part runs contrary to these principles.
48
Mr. Justice DOUGLAS.
49
I agree for the reasons stated by my Brother GOLDBERG that this litigation was properly brough in the state court but on the merits I believe that no cause of action has been made out for the reasons stated by the Court.
50
Mr. Justice HARLAN, concurring in part and dissenting in part.
51
I agree with the Court's opinion and judgment insofar as it relates to the claim that the Joint Conference Committee exceeded its authority under the collective bargaining agreement. Although it is undoubtedly true as a general proposition that bargaining representatives have power to alter the terms of a contract with an employer, the challenge here is not to a purported exercise of such power but to the validity of a grievance settlement reached under proceedings allegedly not autorized by the terms of the collective agreement. Moreover, a committee with authority to settle grievances whose composition is different from that in the multiunion-multi-employer bargaining unit cannot be deemed to possess power to effect changes in the bargaining agreement. When it is alleged that the union itself has engaged or acquiesced in such a departure from the collective bargaining agreement, I can see no reason why an individually affected employee may not step into the shoes of the union and maintain a § 301 suit himself.
52
But insofar as petitioners' claim rests upon alleged unfair union representation in the grievance proceeding, I agree with the views expressed in the concurring opinion of my Brother GOLDBERG (ante, 355—358) (except that I would expressly reserve the question of whether a suit of this nature would be maintainable under § 301 where it is alleged or proved that the employer was a party to the asserted unfair union representation). However, the conclusion that unilateral unfair union representation gives rise only to a cause of action for violation of a duty implicit in the National Labor Relations Act brings one face-to-face with a further question: Does such a federal cause of action come within the play of the preemption doctrine, San Diego Bldg. Trades Council, etc. v. Garmon, 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775, contrary to what would be the case were such a suit to lie under § 301, Smith v. Evening News Assn., 371 U.S. 195, 83 S.Ct. 267, 9 L.Ed.2d 246? Short of deciding that question, I do not think it would be appropriate to dispose of this case simply by saying that no unfair union representation was shown in this instance. For if there be preemption in this situation, Garmon would not only preclude state court jurisdiction but would also require this Court initially to defer to the primary jurisdiction of the Labor Board.
53
The preemption issue is a difficult and important one, carrying ramifications extending far beyond this particular case. It should not be decided without our having the benefit of the views of those charged with the administration of the labor laws. To that end I would reverse the judgment of the state court to the extent that it rests upon a holding that the Joint Conference Committee acted beyond the scope of its authority, set the case for reargument on the unfair representation issue, and invite the National Labor Relations Board to present its views by brief and oral argument on the preemption question. Cf. Retail Clerks International Assn., etc. v. Schermerhorn, 373 U.S. 746, 757, 83 S.Ct. 1461, 1464, 10 L.Ed.2d 678; 375 U.S. 96, 84 S.Ct. 219.
1
The International union was also named as a party but service was quashed and the action dismissed as against it.
2
The denial of a temporary injunction by the trial court was set aside and temporary injunction ordered by the Court of Appeals. Thereafter the trial court dismissed the complaint, but the Court of Appeals reversed and made the temporary injunction permanent.
3
In its brief filed here Dealers does not support the decision of the Joint Committee. It suggests, rather, that the matter be finally settled by arbitration under the terms of the contract.
4
Section 301(a) of the L.M.R.A. is as follows:
'Suits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.' 29 U.S.C. § 185(a).
5
Compare, for example, National Labor Relations Board v. Local 294, International Bro. of Teamsters, 317 F.2d 746 (C.A.2d Cir.), with Miranda Fuel Co., 140 N.L.R.B. 181 (1962); enforcement denied National Labor Relations Board v. Miranda Fuel Co., 326 F.2d 172 (C.A.2d Cir.). See also Cox, The Duty of Fair Representation, 2 Villanova L.Rev. 151, 172—175.
6
The union contended in the state courts that the jurisdiction of the state courts had been preempted by the federal statutes. The Kentucky Court of Appeals ruled otherwise and the union appears to have abandoned the view here, since it says, relying upon Ford Motor Co. v. Huffman, 345 U.S. 330, 73 S.Ct. 681, 97 L.Ed. 1048, that individual employees 'may undoubtedly maintain suits against their representative when the latter hostilely discriminates against them.'
We note that in Syres v. Oil Workers International Union, 350 U.S. 892, 76 S.Ct. 152, 100 L.Ed. 785, individual employees sued the exclusive agent and the company to enjoin and declare void a collective bargaining agreement alleged to violate the duty of fair representation. Dismissal in the trial court was affirmed in the Court of Appeals. This Court reversed and ordered further proceedings in the trial court in the face of contentions made both in this Court and the lower courts that the employees should have brought their proceedings before the National Labor Relations Board. Cf. Cosmark v. Struthers Wells Corp., 194 A.2d 325 (Pa. Oct. 17, 1963).
The E & L employees, petitioners in No. 17, urge that even if the federal courts may entertain suits such as this, the state courts may not. Since in our view the complaint here charged a breach of contract, we find no merit in this position. It is clear that suits for violation of contracts between an employer and a labor organization may be brought in either state or federal courts. Dowd Box Co. v. Courtney, 368 U.S. 502, 82 S.Ct. 519, 7 L.Ed.2d 483.
7
We need not consider the problem posed if § 5 had been omitted from the contract or if the parties had acted to amend the provision. The act is that they purported to proceed under the section. They deadlocked at the local level and it was pursuant to § 5 that the matter was taken to the Joint Conference Committee which, under Art. 7, was to make a decision 'after listening to testimony on both sides.' The committee expressly recited that its decision was in accordance with § 5 of the contract. Even in the absence of § 5, however, it would be necessary to deal with the alleged breach of the union's duty of fair representation.
8
We also put aside the union's contention that Art. 7, § (d)—providing that all matters of interpretation of the agreement be submitted to the Joint Conference Committee—makes it inescapably clear that the committee had the power to decide that the transfer of operating authority was an absorption within the scope of § 5. But it is by no means clear that this provision in Art. 7 was intended to apply to interpretations of § 5, for the latter section by its own terms appears to limit the authority of the committee to disputes over seniority in the event of an absorption. Reconciliation of these two provisions, going to the power of the committee under the contract, itself presented an issue ultimately for the court, not the committee, to decide. Our view of the scope and applicability of § 5, infra, renders an accommodation of these two sections unnecessary.
9
See cases cited in footnote 10, infra.
10
See for example, Kent v. Civil Aeronautics Board, 204 F.2d 263 (C.A.2d Cir. 1953); Keller v. Teamsters Local 249, 43 CCH Labor Cases 17,119 (D.C.W.D.Pa.1961); Pratt v. Wilson Trucking Co., 214 Ga. 385, 104 S.E.2d 915 (1958); Walker v. Pennsylvania-Reading Seashore Lines, 142 N.J.Eq. 588, 61 A.2d 453 (1948); In re Western Union Telegraph Co. and American Communications Association (Decisions of War Labor Board 1944) 14 L.R.R.M. 1623. Cf. Colbert v. Brotherhood of Railroad Trainmen, 206 F.2d 9 (C.A.9th Cir. 1953); National Labor Relations Board v. Wheland Co., 271 F.2d 122 (C.A.6th Cir. 1959); Hardcastle v. Western Greyhound Lines, 303 F.2d 182 (C.A.9th Cir. 1962); Fagan v. Pennsylvania R. Co., 173 F.Supp. 465 (D.C.M.D.Pa.1959). 'Integration of seniority lists should ordinarily be accomplished on the basis of each employee's length of service with his original employer * * *.' Kahn, Seniority Problems in Business Mergers, 8 Industrial and Labor Relations Review 361, 378.
11
The Dealers employees rely upon a rider to the Dealers contract protecting the seniority of the employees at a terminal when another terminal of that company is closed down. The court below did not believe the rider dispositive, and we agree.
1
E.g., United Steelworkers of America v. American Manufacturing Co., 363 U.S. 564, 80 S.Ct. 1343, 4 L.Ed.2d 1403; United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 80 S.Ct. 1347, 4 L.Ed.2d 1409; United Steelworkers of America v. Enterprise Wheel & Car Corp., 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424.
2
The Court states that 'In its brief filed here Dealers does not support the decision of the Joint Committee.' See ante, at 343, n. 3. The Court overlooks, however, that Dealers throughout the litigation has acknowledged that it is a part of the multiemployer unit, which is the employer party to the collective bargaining agreement and that the employer representatives on the Joint Conference Committee acted honestly and properly on behalf of the employer members including Dealers. See infra, at 357.
3
The contract in this case specifically envisioned such a result. Section 5 of Article 4 provided that:
'In the event that the Employer absorbs the business of another private, contract or common carrier, or is a party to a merger of lines, the seniority of the employees absorbed or affected thereby shall be determined by mutual agreement between the Employer and the Unions involved. Any controversy with respect to such matter shall be submitted to the joint grievance procedure * * *.'
Section 2 of Article 7 also provided that:
'(d) It is agreed that all matters pertaining to the interpretation of any provision of this Agreement, whether requested by the Employer or the Union, must be submitted to the full Committee of the Automobile Transporters Joint Conference Committee, which Committee, after listening to testimony on both sides, shall make a decision.'
Moreover, as the Court itself points out, other provisions stated that it was 'the intention of the parties to resolve all questions of interpretation by mutual agreement' and that the employer agreed 'to be bound by all of the terms and provisions of this Agreement, and also agrees to be bound by the interpretations and enforcement of the Agreement. Ante, at 339.
4
See note 2, supra.
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375 U.S. 301
84 S.Ct. 391.
11 L.Ed.2d 347
N. L. LINER et al., Petitioners,v.JAFCO, INC., et al.
No. 43.
Argued Nov. 21, 1963.
Decided Jan. 6, 1964.
S. Del Fuston, Chattanooga, Tenn., for petitioners.
Jac Chambliss, Chattanooga, Tenn., for respondents.
Mr. Justice BRENNAN delivered the opinion of the Court.
1
The Chattanooga Building Trades Council, AFL, is composed of 17 building trades unions, including Hod-Carriers Building and Common Laborers' Union of America and its Local 846, two of the petitioners. Respondent Rea Construction Company, a large North Carolina building contractor, was engaged by respondent Jafco, Inc., as general contractor to erect a shopping center on a site in Cleveland, Tennessee. Rea operated an open shop, and workers on the project were paid lower wages than the union scale. The Council authorized the Hod-Carriers to place a single picket at the site in protest. The petitioner Liner, carrying a sign which read 'Rea Construction Co., not under contract with Chattanooga Building Trades Council, A.F. of L.,' began peaceful picketing on August 8, 1960. Construction workers on the job promptly ceased work. On the same day respondent Jafco, Inc., sought an ex parte injunction against the picketing from the Tennessee Chancery Court, which ordered the injunction to issue upon the execution and filing of an injunction bond. See 5 Tenn.Code Ann., 1955, § 23 1901. The next day, August 9, Jafco filed a bond providing that, if the injunction action failed, Jafco 'shall well and truly pay and satisfy the said (petitioners) all such costs, damages, interest, and other sums as may be awarded and recovered against the said Jafco, Inc. in any suit or suits which may be hereafter broyght (sic) for wrongfully suing out said Injunction * * *.' Thereupon the ex parte injunction issued,1 the picketing ceased in compliance with it, and work on the project was resumed.
2
The petitioners moved promptly in the Chancery Court to dissolve the injunction on the ground that the state court was without jurisdiction to adjudicate the controversy because the subject matter of the picketing was exclusively within the cognizance of the National Labor Relations Board. The motion was denied on September 29 by an order which recited, 'There is no bona fide labor dispute between the parties in this litigation and therefore the state court has jurisdiction of the matter and the same has not (been) preempted by the National Labor Relations Board.'2 Following a hearing, the injunction was made permanent by a final decree entered on June 16, 1961. Petitioners appealed to the Court of Appeals of Tennessee, Eastern Section, which affirmed on January 12, 1962. The opinion, not officially reported, is reported in 49 L.R.R.M. 2585. Pending decision on the appeal, construction at the site had been completed. Noting this fact, the court stated, 'In the first place the questions in this case have become moot.' However, the court went on to say, 'Further, we concur with the Chancellor's finding that a bona fide labor dispute did not exist.' 49 L.R.R.M., at 2587. The Supreme Court of Tennessee, by an unreported order, denied certiorari. We brought the case her, 371 U.S. 961, to consider the validity of the injunction in light of our decision in Local No. 438, Construction Laborers' Union, A.F.L.—C.I.O. v. Curry, 371 U.S. 542, 83 S.Ct. 531, 9 L.Ed.2d 514. We hold that the issuance of the injunction was beyond the power of the Tennessee courts and therefore reverse the judgment.
3
We must first consider respondents' challenge to our jurisdiction to review the Tennessee courts' rejection of the petitioners' federal preemption claim. The argument is that we are bound by the state appellate court's holding that this case was rendered moot by the completion of construction. We think, however, that in this case the question of mootness is itself a question of federal law upon which we must pronounce final judgment. Love v. Griffith, 266 U.S. 32, 45 S.Ct. 12, 69 L.Ed. 157. In that case a Texas trial court dismissed a suit to enjoin the enforcement of an allegedly unconstitutional rule which barred Negroes from voting in a single Houston Democratic primary election. An appeal from the dismissal was in turn dismissed by the Texas Court of Civil Appeals on the ground that, since the election was, at that time, long since passed the cause of action had ceased to exist. This Court, speaking through Mr. Justice Holmes, implicitly denied that the state court's finding of mootness precluded our independent determination of that question, saying,
4
'When as here there is a plain assertion of federal rights in the lower court, local rules as to how far it shall be reviewed on appeal do not necessarily prevail. Davis v. Wechsler, 263 U.S. 22, 24, 44 S.Ct. 13, 68 L.Ed. 143. Whether the right was denied or not given due recognition by the Court of Civil Appeals is a question as to which the plaintiffs are entitled to invoke our judgment. Ward v. (Board of County Commissioners of) Love County, 253 U.S. 17, 22, 40 S.Ct. 419, 64 L.Ed. 751.' 266 U.S., at 33—34, 45 S.Ct., at 12, 69 L.Ed. 157.
5
The Court did not, however, think that the action of the Texas Court of Civil Appeals prejudiced the appellants' constitutional rights. Since the election had been held, any order reversing the trial court and ordering the injunction to issue would have been futile; an injunction could not at that date redress the alleged constitutional injury. The Court said:
6
'If the case stood here as it stood before the court of first instance it would present a grave question of constitutional law and we should be astute to avoid hindrances in the way of taking it up. But that is not the situation. The rule promulgated by the Democratic Executive Committee was for a single election only that had taken place long before the decision of the Appellate Court. No constitutional rights of the plaintiffs in error were infringed by holding that the cause of action had ceased to exist. The bill was for an injunction that could not be granted at that time. There was no constitutional obligation to extend the remedy beyond what was prayed.' 266 U.S., at 34, 45 S.Ct., at 12, 69 L.Ed. 157.
7
In contrast, the prejudice to the petitioners from the action of the Tennessee Court of Appeals in affirming the injunction which did issue in the instant case is clear. The petitioners plainly have 'a substantial stake in the judgment * * *,' Fiswick v. United States, 329 U.S. 211, 222, 67 S.Ct. 224, 230, 91 L.Ed. 196, which exists apart from and is unaffected by the completion of construction. Their interest derives from the undertaking of respondent Jafco, Inc., in the injunction bond to indemnify them in damages if the injunction was 'wrongfully' sued out. Whether the injunction was wrongfully sued out turns solely upon the answer to the federal question which the petitioners have pressed from the beginning. If the answer of the Tennessee Court of Appeals to that question may not be challenged here, the petitioners have no recourse against Jafco on the bond. Thus, unlike Love v. Griffith, supra, the federal issues remain of operative importance to the parties as they come to this Court; here it may be said that the Tennessee courts have in substance and effect denied a federal right, and the completion of construction cannot be deemed a hindrance to our review of the federal question. This is not a case where this Court's decision on the merits of that question 'cannot affect the rights of the litigants in the case before it.' St. Pierre v. United States, 319 U.S. 41, 42, 63 S.Ct. 910, 911, 87 L.Ed. 1199.3
8
Moreover, this is particularly a case in which 'we should be astute to avoid hindrances in the way of taking' up that question. Despite the completion of construction, our superintendence of a state court injunction against conduct alleged to be cognizable exclusively by the National Labor Relations Board is desirable 'if the danger of state interference with national policy is to be averted,' San Diego Building Trades Council, Millmen's Union, Local 2020 v. Garmon, 359 U.S. 236, 245, 79 S.Ct. 773, 780, 3 L.Ed.2d 775. This controversy involves the fundamental question of whether the Tennessee courts had any power whatever to adjudicate the dispute between the parties. Congress has invested the National Labor Relations Board with the exclusive power to adjudicate conduct arguably protected or prohibited by the National Labor Relations Act. San Diego Building Trades Council, Millmen's Union Local 2020 v. Garmon, supra. If the peaceful picketing complained of in this case is such conduct, Congress has ordained—to further uniform regulation and to avoid the inconsistencies which would result from the application of disparate state remedies—that only the federal agency shall deal with it. Weber v. Anheuser-Busch, Inc., 348 U.S. 468, 75 S.Ct. 480, 99 L.Ed. 546. The issuance of the state injunction in this case tended to frustrate this federal policy. This would be true even if the picketing were prohibited conduct. For although the National Labor Relations Board is not barred from granting appropriate remedies by the fact that the challenged conduct has ceased, National Labor Relations Board v. Mexia Textile Mills, Inc., 339 U.S. 563, 70 S.Ct. 826, 94 L.Ed. 1067, or that the construction has been completed, Local 74, United Brotherhood of Carpenters and Joiners of America, A.F. of L. v. N.L.R.B., 341 U.S. 707, 71 S.Ct. 966, 95 L.Ed. 1309, charges of unfair labor practices must be filed within six months of their occurrence,4 and an employer armed with a state injunction would have no incentive to initiate Board proceedings. It would encourage such interference with the federal agency's exclusive jurisdiction if a state court's holding of mootness based on the chance event of completion of construction barred this Court's review of the state court's adverse decision on the claim of federal preemption.5 We have given significant weight to the vital importance of preventing state injunctions from frustrating federal labor policy in situations which the Congress has ordained shall be dealt with exclusively by the Board. In Local No. 438, Construction Laborers' Union, A.F.L.—C.I.O. v. Curry, supra, we considered whether a state court temporary injunction in a labor dispute should be considered to be a final judgment for purposes of our review under 28 U.S.C. § 1257. We held that the temporary injunction should be deemed a final judgment 'particularly when postponing review would seriously erode the national labor policy requiring the subject matter of respondents' cause to be heard by the National Labor Relations Board, not by the state courts,' and said further, 'The truth is that authorizing the issuance of a temporary injunction, as is frequently true of temporary injunctions in labor disputes, may effectively dispose of petitioner's rights and render entirely illusory his right to review here as well as his right to a hearing before the Labor Board.' 371 U.S., at 550, 83 S.Ct., at 536, 9 L.Ed.2d 514.
9
In Sola Electric Co. v. Jefferson Electric Co., 317 U.S. 173, 63 S.Ct. 172, 87 L.Ed. 165, a patent licensee defended against a suit for unpaid royalties by attacking the validity under the Sherman Act of a price-fixing stipulation in his license. The lower courts held that having accepted the license with the price-fixing stipulation, the licensee was estopped to deny the validity of the stipulation. This Court reversed. The question presented was 'whether the doctrine of estoppel as invoked below is so in conflict with the Sherman Act's prohibition of price-fixing that this Court may resolve the question even though its conclusion be contrary to that of a state court.' 317 U.S., at 175, 63 S.Ct., at 173, 87 L.Ed. 165. We held that local rules of estoppel would not be permitted to thwart the purposes of statutes of the United States. We said, 317 U.S., at 176, 63 S.Ct., at 173, 87 L.Ed. 165:
10
'It is familiar doctrine that the prohibition of a federal statute may not be set at naught, or its benefits denied, by state statutes or state common law rules. In such a case our decision is not controlled by Erie Railroad v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188. There we followed state law because i was the law to be applied in the federal courts. But the doctrine of that case is inapplicable to those areas of judicial decision within which the policy of the law is so dominated by the sweep of federal statutes that legal relations which they affect must be deemed governed by federal law having its source in those statutes, rather than by local law. * * * When a federal statute condemns an act as unlawful the extent and nature of the legal consequences of the condemnation, though left by the statute to judicial determination, are nevertheless federal questions, the answers to which are to be derived from the statute and the federal policy which it has adopted. To the federal statute and policy, conflicting state law and policy must yield. Constitution, Art. VI, cl. 2; * * *'.
11
If in Sola a state substantive rule of law had to yield to the federal statute and policy, even more so here—where the claim is that the federal statute and policy oust state courts of any power whatever to deal with the conduct in question—local rules which purport to preclude state appellate court adjudication of the federal preemption claim cannot conclusively render the case moot for the purposes of this Court's review.
12
We turn then to the merits. Our discussion need not be extended, for in our view the case is squarely governed by our decision in Local No. 438 Construction Laborers' Union, A.F.L. C.I.O. v. Curry, supra. Whether or not the facts showed a 'labor dispute' within the meaning of 29 U.S.C. § 152(9)6 is certainly at least arguable. Consequently, as we said in Curry, 'the state court had no jurisdiction to issue an injunction or to adjudicate this controversy, which lay within the exclusive powers of the National Labor Relations Board.' 371 U.S., at 546—547, 83 S.Ct., at 534 535, 9 L.Ed.2d 514.
13
The judgment is reversed and the case remanded for further proceedings not inconsistent with this opinion.
14
It is so ordered.
15
Judgment reversed and case remanded.
1
The respondent Rea Construction Company was added as a party complainant by an amended and supplemental bill filed August 10, 1960.
2
In its opinion on making the injunction perpetual, the trial court also found 'that the erection of the shopping center does not involve Interstate Commerce. It is a localized action and by no definition of the term can it be said that this operation amounts to Interstate Commerce.' The respondents do not support this finding in this Court. The proof was that, before the hearing, Rea Construction Company purchased outside Tennessee and brought to the site materials costing $147,099.67. This meets the direct inflow standards set by the National Labor Relations Board for the exercise of its jurisdiction. See 23 N.L.R.B.Ann.Rep. 8 (1958).
3
Our lack of jurisdiction to review moot cases derives from the requirement of Article III of the Constitution under which the exercise of judicial power depends upon the existence of a case or controversy. See Diamond, Federal Jurisdiction to Decide Moot Cases, 94 U. of Pa.L.Rev. 125 (1946); Note, 103 U. of Pa.L.Rev. 772 (1955).
4
29 U.S.C. § 160(b).
5
The petitioners sought to advance the hearing and decision of their appeal to the Tennessee Court of Appeals. The court said, 49 L.R.R.M., at 2587: 'The (petitioners) in brief filed June 22nd, 1961, in which they were seeking to advance the cause for hearing, stated:
"In the instant case, the right of picketing will become moot by August 1, 1961, as the construction will be completed and the building ready for occupancy. Appellants know that they desire to picket one of the complainants, Rea Construction Company, this coming fall on a project which will require approximately six or eight months of construction. Without judicial review of this case they can only expect the same Trial Court to act the same, and again they cannot possibly get the case to the appellate court for a decision within that time."
6
'The term 'labor dispute' includes any controversy concerning terms, tenure or conditions of employment, or concerning the association or representation of persons in negotiating, fixing, maintaining, changing, or seeking to arrange terms or conditions of employment, regardless of whether the disputants stand in the proximate relation of employer and employee.'
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