ADMINISTRATIVE PROCEDURE TUESDAY, JUNE 26, 1945 HOUSE OF REPRESENTATIVES, The committee met at 10 a. m., Hon. Hatton W. Sumners (chairman) presiding. The CHAIRMAN. Mr. Aitchison, will you continue with your statement? STATEMENT OF CLYDE B. AITCHISON-Resumed Mr. AITCHISON. Mr. Chairman and members of the committee, shortly before adjournment yesterday, Congressman Walter asked me for citations to the three Supreme Court decisions involving emergency orders of the Commission. They are Avent v. United States (266 U. S. 127); U. S. v. P. Koenig Coal Company (270 U. S. 512); United States v. Michigan Portland Cement Company (270 U. S. 521). These cases, as I recall it, were decided by a unanimous court. The first was by Justice Holmes, the last two were by Chief Justice Taft. There was a fourth case which was cited in 270 United States, the Peoria and Pekin Union case, which involved the question as to whether certain operations were within the language of section 1, paragraph 15, of the act, and they held they were not. I did not have that case in mind when I spoke of the three cases yesterday to Congressman Walter. Mr. SPRINGER. What was the page of the 270 U. S. case? Mr. AITCHISON. There were two cases, pages 512 and 521. I then wish to make clear that under H. R. 1203 the exclusion of certain functions by section 2 (a), such as those which by law expire before July 1, 1947, and certain others, would have the curious effect of leaving these emergency powers that were involved in these three cases still within the scope of operation of H. R. 1203 as respects railroads; but, as to motor carriers and freight forwarders, to which the provisions of the emergency section mentioned were extended by the Second War Powers Act of 1942 temporarily-those functions would be excluded from the operation of H. R. 1203. Certain service orders of the Commission would then be governed by H. R. 1203; certain others as to a different type of carrier would not be governed by H. R. 1203. In my testimony yesterday I spoke of the many cases in which the Commission is required to issue a rule to hold a hearing. That is required by the practicality of the situation. The question was raised why in such cases the party affected should not be permitted to take 69 his testimony into the court at once. Now, under section 17, paragraph (6) of the act, he has a very broad right to come to the Commission, to make application for rehearing, reargument, or reconsideration of the same or any matter determined therein. And it seems to me this is the proper course; because, if there were facts which the interested party desired to have considered which were not available to the Commission within the limited time during which it had to act, the right to ask the Commission to consder them being saved to the party by section 17-6, it is only fair he should come to the Commission and ask that the rule be modified not only for his benefit, but for the benefit of all others who may be concerned, and that the administrative discretion be brought to bear upon a true, accurate, and full knowledge of the facts. If he has relevant facts which make a continuance of the rule unreasonable, the general policy of law has been he should exhaust his administrative remedies before going into court. Of course, we are talking here about extreme cases-these emergency cases. The court, in such a case, finding an administrative question present, would be likely to stay its own proceeding until the complaining party at least had offered to show the Commission by its rule, which we are postulating the law permitted them to make without a formal record, should be considered and heard. Mr. JENNINGS. Suppose you just give us an instance where such a rule as you are now discussing must be made on the theory it is to meet an emergenecy-just one illustration. I want the facts. Mr. AITCHISON. There have been hundreds of them made. They are being made almost daily during the present war-the routing of freight around particular terminals. The very first order that ever was entered by the Commission under that emergency provision happened to be one which I drew and it authorized the carriers to disregard the routing instructions which the law permits the shipper to give and which the law makes binding upon the carrier-to disregard those instructions in cases where the prompt and direct movement of freight would otherwise be hampered. Mr. JENNINGS. You would have congestion on the line of the certain road in question and you could order the routing changed? Mr. AITCHISON. Yes. And the second order under that was one which required the movement of 65,000 empty freight cars, as I recall, in one direction, and up into the tens of thousands of another type of car in the reverse movement. The Koenig cases involved priority in the use of coal car equipment. The only way at that time whereby the social end of seeing that hospitals and Government buildings and common carriers and utilities were kept going could be carried out was by the use of the Commission's car service provisions. And Koenig and the Michigan Portland Cement Co. put in a priority claim, I believe, that they wanted priority coal for a hospital, and the Michigan Portland Cement Co. used it for making cement. That is the type of order I have in mind. Now, since yesterday, I have reread sections 7 and 8 of H. R. 1203, to which I am principally addressing myself, in the light of section 17 of the Interstate Commerce Act as it stands at the present time. I I am convinced that those two sections mentioned are designed to cover completely, with one possible exception, the provisions of section 17 of the Interstate Commerce Act as it relates to the delegation of its work. You have before you the sections I have referred to and doubtless are more familiar with them than I am. Section 17 is wholly too long for me to read it to you. If you are interested in following it directly, may I throw out a valuable suggestion, that if there is anything you want to find in the Commerce Act, it is title 49 of the United States Code; so this is the United States Code 49, section 17. The first paragraph permits the Commission to divide into divisions. That is a feature which is not within the present act except perhaps by reading it in. The word "divisions" I do not believe is mentioned in H. R. 1203. The second paragraph authorizes us to assign particular work of functions to partiular divisions, or to members of the Commission individually, or to a board to be composed of three or more eligible employees of the Commission to be designated by such order, for action thereon, and of course gives the Commission power to supplement and modify those assignments at any time. I call attention to this: By the present law, "the following classes of employees are eligible for designation by the Commission to serve on such a board: Examiners, directors, or assistant directors of bureaus, chiefs of sections, and attorneys." Now, H. R. 1203, if it authorizes us to create a board at all, says that that board shall be composed of individual members of the Commission and examiners, and it eliminates the authority which we have to set up a board which shall consist in part or wholly of directors or assistant directors of bureaus, chiefs of sections, and attorneys. When we come to a matter like the revision of our tariff rules, we have a most highly complicated matter. Of course, particularly if H. R. 1203 became a law, the Commision would be presumed collectively to have full and final knowledge of the technique required for a revision of those rules-and we will have to revise them pretty soon. But there is nobody better qualified to do that job in the first place and to write the recommended decision than the director of the bureau and his assistants, who are laboring with the code of tariff rules and have been laboring with it all these years. Mr. JENNINGS. Do I understand you are discussing subsection (c) on page 7 of H. R. 1203-separation of functions? Mr. AITCHISON. No; I am not. I am referring now particularly to sections 7 and 8 which relate to hearings, and which provide who can hear proceedings. There is not any provision there that we can set up a board for one of those technical questions such as that, or for the revision of the safety appliance rules, or for consultation to help us when we make regulations for the safe transportation of explosives. For one, I disclaim any such omniscience as to entitle me to sit in judgment without the advice and aid of the experts we have gathered around us. In the case I mentioned of the tariff rules Mr. JENNINGS. Just what particular language is it you think would hamper you in the discharge of your duty, or hamper the Commission in the discharge of its duty; what particular language is it you think Mr. AITCHISON. Section 7, paragraph a, page 10, "in a hearing pursuant to sections 4 or 5"-section 4 relating to "rules" and section 5 to "adjudications": SEC. 7. In a hearing pursuant to section 4 or 5— (a) Presiding officers.-There shall preside at the taking of evidence (1) the agency or (2) one or more subordinate hearing officers designated from members of the body which comprises the agency, That is the Commission, I take it. *** Mr. JENNINGS. Does not that clearly mean that either the whole Commission would hear the matter, or else some designated representative of the agency? Mr. BRYSON. Or one member of the Commission. Mr. JENNINGS. Yes; one member of the Commission. Mr. AITCHISON. Why, certainly it does. The point I make is that under the present law we can make a board, which consists of Director Hardie and his two Assistant Directors, to take up the matter of tariff revision and give us a code of rules which we can put out as a proposed report and let everybody shoot at. That is forbidden. Mr. JENNINGS. It seems to me there is nothing here that would hamper you in the discharge of your duty. Mr. AITCHISON. If you will permit me to complete the sentence— you have not the whole sentence in mind yet There shall preside at the taking of evidence (1) the agency or (2) one or more subordinate hearing officers designated from members of the body which comprises the agency, State representatives as authorized by statute, or examiners appointed as provided in this act. In order to make this parallel with section 17, you have to put in there at that point "directors, assistant directors, chiefs of sections, or attorneys" and those words are out. It may be this is better; I am not arguing that at the moment; but I do want to point to the conflict, because it was intimated to me yesterday that I could not tell a conflict when I saw one. Mr. GWYNNE. That only has to do with who shall preside; this does not prohibit people sitting in with and advising you. Mr. AITCHISON. It would prohibit the examiner who sat at that hearing taking testimony from consulting with those gentlemen, in the other portion of the act. Mr. WALTER. He would have a perfect right to consult with them. Mr. AITCHISON. I am glad to hear you say that, because we have not been able to so read the rule. And, Mr. Walter, we are going to take this (and I think everybody will) in good faith and try to make it work; but we have to feel when Congress uses language which says "he shall not consult" with respect to any matter with anybody else except in a formal way, that Congress means that. Mr. WALTER. That is exactly what Congress means and we also mean to make it impossible for star chamber proceedings to be held and rights to be determined without the parties interested having an opportunity to participate in the discussion. Mr. AITCHISON. I am not talking about a star chamber proceeding, Mr. Walter. Mr. WALTER. Oh, you are. Mr. AITCHISON. I am talking about a case where we set up a board statute. If there was a public hearing involved, it would be required, just as this bill requires, to put out a proposed report and let that be served and let the parties except to it. But why should we be deprived of the opportunity to use our experts in that manner? Mr. JENNINGS. Now, does it deprive you of that right and opportunity? Suppose you send an expert out and he makes an investigation and is in possession of the facts: Do you make insistence that under this act the Commission could not put him on the stand, or use the result of his investigation? Mr. AITCHISON. Not at all. Mr. JENNINGS. To enable them to arrive at a correct conclusion? Mr. AITCHISON. Not at all. We have put many of them on and it is our policy, whenever our people have facts of that sort, to do so. But I am talking about a case where we are setting up a board which is to take the testimony, and I am simply addressing myself to the sole question as to whether H. R. 1203 is so necessarily inconsistent with the present section 17-1 as to repeal it by implication-necessary implication. Mr. SPRINGER. Under that section 7 to which you just referred a little while ago, that section provides that "there shall preside at the taking of evidence," that is, the ascertaining of the facts, "the agency or one or more subordinate hearing officers." It does not attempt to set up who shall hear or take the evidence; that section just provides as to the presiding officer. Mr. AITCHISON. Well, I do not know how the whole agency is to preside. When the whole agency is there, I suppose the chairman presides. Mr. SPRINGER. It does not say the entire agency. Mr. AITCHISON. No; but it says "there shall preside at the taking of the evidence (1) the agency." Mr. SPRINGER. The agency or one or more subordinate officers designated by the members of the body. You can designate one. Mr. AITCHISON. Naming who they are. Mr. SPRINGER. That is right. Mr. AITCHISON. We can set up a board consisting of Director Hardie if we wanted to? Mr. SPRINGER. That is right. And do not you do that at your hearings-designate one to preside at the taking of testimony? Mr. AITCHISON. Yes; but H. R. 1203 would forbid our designating Director Hardie, because he is not an examiner; he is not a member of the Commission; he is not a State commissioner. The CHAIRMAN. Mr. Aitchison, what additional or amendatory language would you suggest to the provisions, of the bill in question, or whichever one you want to consider, which would give you the opportunity to use your personnel and your whole facilities to the best advantage, and yet help to avoid some of the practices which the committee evidently has in mind it would like to have avoided? Mr. AITCHISON. That is a very broad question, but I shall confine my answer, if I may, to the specific points we are discussing, which would, of course, involve a reconciliation of the language of section 7, paragraph a, with the language of section 17, paragraph 2. But there |