281 F. 298 | 6th Cir. | 1922
The Lever Act was approved and took effect August 10, 1917. 40 Stat. c. 53, p. 276 (Comp. St. 1918, Comp. St. Ann. Supp. 1919, §§ 3115y8e-3115y8kk, 3115%«115%r). Its title declares it—
“an act to provide further for the national security and defense by encouraging the production, conserving the supply and controlling the distribution of food products and fuel.”
By section 25 (section 3115%q) the President of the United States was authorized and empowered—
“whenever and wherever in his judgment necessary for the efficient prosecution of the war, to fix the price of coal and coke, wherever and whenever*300 sold, either by producer or dealer, to éstablish rules for the regulation of and to regulate the method of production, sale, shipment, distribution, apportionment, and storage thereof among dealers and consumers, domestic or foreign,” etc.
Subdivision 17 of that section penalizes the violation of or refusal to conform to the regulations provided for in the section, with knowledge that they have been so prescribed. On August 23, 1917, the President adopted a series of regulations as to prices and margins to be in force “pending further investigation or determination thereof by th® President.” The first of these regulations defined a coal jobber as a person (or other agency) “who purchases and resells coal to coal dealers or to consumers without physically handling it on, over, or through his own vehicle, dock, trestle or yard.” Regulation No. 2 forbids a jobber, for the buying and selling of bituminous coal, to add to his purchase price a gross margin in excess of 15 cents per ton. Paragraph 16 of section 25 provides that the maximum price fixed and published (by the Trade Commission) shall not be construed as invalidating any contract in which prices are fixed, made in good faith, prior to the establishment and publication of maximum prices by the commission; and on October 6, 1917, the Fuel Administrator made a regulation that bona fide contracts relating to bituminous coal, made before the President's proclamation of August 21, 1917, should not be affected “by these proclamations.”
It is conceded or established by verdict that the Matthew Addy Company was, at the time of the transactions complained of, a corporation conducting at Cincinnati, Ohio, the business of a coal jobber, as defined in the President’s regulation; that Benjamin N. Ford was vice president, and in such capacity had control and direction of the activities and contracts of the Matthew Addy Company, so far as they related to the conduct of the business as a coal jobber; and that each plaintiff in error knew of the regulation fixing the “gross margin” at 15 cents per ton. The corporation (cause No. 3517) and Ford (No. 3516) were separately indicted for making, subsequent to August 23, 1917, various specific sales of coal at a price which “included a profit or gross margin” to the corporation of 25 cents per ton; the corporation having no contract with the purchaser made in good faith prior to August 23, 1917, and with knowledge on the part of the respective defendants that such “profit or gross margin of 25 cents per ton” was in excess of the “profit or gross margin of 15 cents per ton” permitted, by the executive order and regulations referred to, to be added to the purchase price paid by the jobber.- The corporation was convicted upon 13 counts of the indictment against it; Ford was convicted upon 7 counts of the indictment against him. In the case of each count in each indictment on which conviction was had it was either admitted or established that the sales were made at a gross margin of 25 cents 'in excess of the purchase price to the jobber, and that on August 2-3, 1917, the corporation had no contract for the sales in question. It appeared, however, that all the coal covered by the various counts had been purchased by the corporation previous.to August ID, 1917, when the Fever Act took effect. The two-cases were tried together, and were
It seems plain that the President’s order of August 23d should not be construed as excluding from its operation coal previously bought. Neither the statute nor the regulations were ordinary legislation. That they were designed to meet a real emergency is shown, not only by the title of the act, but by the preamble, which asserts that the measures provided thereby for conserving the supply of food products, fuel, etc., the establishment of government' control, and the issue of regulations and orders provided for, were by reason of the existence of a state of war essential to the national security and defense, for the successful prosecution of the war, and for the maintenance of the army and navy. The act was in terms made effective only until the end of the then existing war. Even ordinary remedial laws, although penal, are not to be so strictly construed as to defeat the obvious legislative intent. Johnson v. So. Pacific R. R. Co., 196 U. S. 1, 17-18, 25 Sup. Ct. 158, 49 L. Ed. 363.
We think the sole inquiry in this connection relates to the. intent of the executive in making the order of August 23d. The order must, we think, be construed as applying to all sales made subsequent to the order, regardless of the time the purchases were made. . No limitation in this respect was placed by the statute upon executive action. The authority given was to fix prices of coal wherever and whenever sold. The order of August 21st followed but 10 days after the passage of the statute. It stated that it should be in force pending further investigation. As stated by the trial judge, it .was matter of public knowledge, and recognized in certain orders of the fuel administration, that the coal mine output was largely contracted to be sold in advance; that the supply of coal was to a large extent, and in a proper sense, in
“in fixing sucli prices for dealers, tlie Commission shall allow the cost of the dealer and shall add thereto a just and reasonable sum for his profit in the-transaction.”
In our opinion this contention overlooks the summary nature of the power which we think was conferred on the President, to meet the emergency by making temporary orders which should, so far as possible, save the immediate situation until the commission should have time and opportunity, through its slower processes, to make more complete investigation of conditions and 'remedies. It should be conclusively presumed that the President gave the subject all the investigation and consideration which the emergency permitted. It was thus not open to plaintiffs in error to show that in their specific cases the margin allowed was inadequate or resulted in loss.
“Said authority and power may1 be exercised by him in each case through the agency of the Federal Trade Commission during the war, or for such part of said time as in his judgment may be necessary.”
Plaintiffs in error contend that the word “may” must be construed' as “shall,” and that this is shown by the asserted “startling innovation
We are unable to agree with this contention. The District Judge,! in a brief but comprehensive opinion (263 Fed. 451), held that the word “may” is merely permissive; that the President was by the first paragraph of the section empowered, not required, to exercise his authority-through the Commission in each instance; and that such intention was otherwise clear from the context. In this opinion we fully concur.
Nor do we think there was error in refusing defendants’ request to charge that defendants were not liable unless the 25 cents per ton, added by them to the purchase price of $3.25 per ton, included a profit (after the deduction of all costs and expenses) in excess of 15 cents per ton, and in charging that “profit” means the same as “gross margin,” viz. the difference between the purchase price and the selling price.
As to the second criticism: While under ordinary conditions notice and hearing would' be conditions precedent to the making of an order of this kind, we agree with the court below (265 Fed. 424) that due process of law is not to be tested by form of procedure merely, that public danger warrants the substitution of executive processes for judicial process (Moyer v. Peabody, 212 U. S. 78, 84, 29 Sup. Ct. 235, 53 L. Ed. 410), and that under the war conditions then existing, and as indicated by the preamble of the act, the fixing of prices in industries so vital to the prosecution of the war as food and fuel was not the deprivation of due process of law, but is within the power given to Congress by article 1, § 8, of the Constitution, to make all laws necessary and proper for carrying into execution the war powers expressly enumerated.
Our conclusion that section 25 of the-Lever Act is valid is confirmed-by the many recent decisions of the Supreme Court sustaining the ex
, The section is further criticized as violating articles 1, 2, and 3 of the federal Constitution, by attempting to delegate legislative and judicial powers to the President, the Fuel Administrator, and the Federal Trade Commission. We are unable to recognize any delegation of judicial power. In our opinion the delegation of power to make reasonable rules and régúlations for the control of the food and fuel supply did not violate the prohibition against delegation of legislative power. Buttfield v. Stranahan, 192 U. S. 470, 494, 24 Sup. Ct. 349, 48 L. Ed. 525; Union Bridge Co. v. United States, 204 U. S. 364, 377, 27 Sup. Ct. 367, 51 L. Ed. 523; St. Louis, etc., Ry. Co. v. Taylor, 210 U. S. 281, 28 Sup. Ct. 616, 52 L. Ed. 1061; McKinley v. United States, supra.
We see no merit in the suggestion that the section is an abuse of the powers given Congress to provide for the national security and defense, or in the contention that the section violates the Tenth Amendment by interfering with the rights of the respective states as to regulation of industries within the states.
-. We have not- discussed -all the arguments adduced by counsel for pláintiffs in error in support of their contentions. We have, however, given them full consideration, and have reached the conclusion that no error was committed by the court below in the respects complained of, and that -its judgment should be affirmed.
Italics ours.