Mr. REECE. And, likewise, Mr. Hoge would like to have an extension of his remarks prepared, citing some cases which are not quite ready but which I will hand in.

Mr. SADOWSKI. That permission is granted.

STATEMENT OF NATHAN BOONE WILLIAMS, 1010 VERMONT

AVENUE, WASHINGTON, D. C.

Mr. WILLIAMS. I appear on behalf of the Association of American Soap and Glycerine Manufacturers-Producers, Inc., 295 Madison Avenue, New York, N. Y., a membership corporation composed of 193 dues-paying members.

I shall proceed to the observations which I wish to make largely upon my own and upon what I feel to be my own responsibility as a lawyer and in possession of information with respect to this legislation.

In the first place, I want to support vigorously the proposal that the courts should have the right to review decisions of the Commission on the basis of preponderance of evidence.

Thirty years ago I had an experience with the Post Office Department which illustrates what I mean.

A client of mine was publishing letters and instructions to tell people what to eat in order to get the right vitamins for the protection of their health. A citation for fraud order was issued by the Post Office Department and witnesses were called from various and sundry offices, offices of the Government, Government employees who testified that there was no such thing as vitamins. And now you cannot turn on a radio nor look in a drug-store window nor read an advertisement but what you see that. The man was put out of business and a broad order issued against him.

With all due respect to many of the cases that come up of this character, there is a difference of opinion in the higher scientific circles, and certainly the courts ought to be able to review those matters on the basis of the preponderance of the evidence.

Mr. SADOWSKI. At that time, the court itself did not know there were vitamins; probably would not have done much good.

Mr. WILLIAMS. It might not have. That is true. We are supposed to make some progress, however.

The Federal Trade Commission was the first one whereby Congress shirked or at least transferred or went into the idea of using Commissions or establishing administrative bodies to administer particular laws other than those relating to public utilities.

It is the grandfather of all of the brood that we have had since, and what I have to say and what I have to point out with respect to this subject, I wish to assure the committee I do without any consideration of foes to fear or friends to favor.

Woodrow Wilson, writing in the American Lawyer, issue of May 1908, 4 years before he was a candidate and elected to the Presidency of the United States, writing on the subject of trust crusading had this to say:

Governmental control which we are undertaking so extensively and with so light a heart sets up not a reign of law but a reign of discretion and individual judgment on the part of Government officials in the regulation of business, of stock companies owned by innumerable private individuals and supplying the chief investments of thousands of communities. I can see no radical difference

in principle between Government ownership and governmental regulation of discretionary kind. Regulation by commission is not regulation by law, but control according to the discretion of governmental officials. Regulation by law is judicial by fixed and definite rules, whereas regulation by commission as an affair of business sense, of the comprehension and thorough understanding of complex and various bodies of business. There is no logical stopping place between that and the actual conduct of business enterprises by the Government. Such methods of regulation, it may be safely predicted will sooner or later be completely discredited by experience

and a few more words along the same general line.

It has long been recognized, in fact it was said by Alexis de Tocqueville

The strength of the courts of law has ever been the greatest security which can be offered to personal independence, but this is more especially the case in democratic ages. Private rights and interests are in constant danger if a judicial power does not grow more extensive and more sound to keep pace with the growing equality of conditions.

That is from Alexis de Tocqueville's Democracy in America.

The callow advocates of administrative justice insist that the courts do not properly adjudicate between the myriads of conflicts between citizen and citizen and between government and the citizen. Under our maze of laws with their indiscriminate perplexity maybe this is partially true, but the remedy lies not in the centralization of further power and opportunities for pernicious meddling by such agencies, but in stripping from our laws all nonessentials and in bringing our laws into the confines of those which are necessary and may be observed without detriment to any one.

Laws are worse than useless unless they, within the reasonable understanding and comprehension of the citizen, are adapted to his needs and to modern conditions.

Instead of facilitating the work of our courts of law in the determination of proper issues, we have removed much of such rightful duty and placed it in the care and keeping of administrative agencies of doubtful utility far removed from the watchful eyes of the people. Under modernized procedure no difficulty would be experienced in keeping the dockets of the courts current.

The ideas expressed in the Magna Carta would be speedily accomplished.

To no one will we deny right or justice. If found necessary, justice would summon the requisite number of qualified lawyers to aid as aids to the court to hear, report upon, and write findings of fact and opinions in particular cases, all subject to exception and review by the

courts.

Lawyers are a part of the judicial system. The judges, of course, know the membership of the bar of their respective courts or can readily ascertain their standing and qualification for special duties.

Men familiar with particular branches of the law will be chosen for special tasks in instances where such subjects were involved or in question.

Having discharged their detail of public service they would pass back into the ranks of the bar.

Such opportunities for service would be a constant spur to the ambitious and worthy young lawyer, much more socially valuable than is the oft deferred hope of a political job in a political commission where he is to exercise inexperienced talents and promotes his ambition at constant public expense. In every community there is a wealth of talent now largely unused.

It is true that unquestionably, at least partially, we need some expansion of the authority of the courts in such matters.

It was the hope of some of us, when the Federal Trade Commission law was passed, that it would meet the criticism which had been presented in the debates that went on in Congress with respect to it which, by the way, I may say, that the Federal Trade Commission law as it emerged, in all my 35 years' experience of congressional legislation, presents the most complete and absorbing exercise of the power of a congressional conference committee that I have ever noted.

The bill, as it passed the House, and the bill, as it passed the Senate, was of such character that it was completely rewritten in conference until its author would scarcely recognize it, and that is a matter of record to be determined by your examination of what happened with respect to it.

I was at the time on the staff of the Judiciary Committee of the House and, as I say, it was the hope of some of us that the Federal Trade Commission would do what Lord Mansfield did many centuries ago, specify along the same line that Woodrow Wilson outlined in the article from which I have quoted, the particular instances and the kind and character of unfair methods of competition and define them as experience would develop their instance and their character.

And here we have now so many commissions that the Congress itself would probably have to call in a group of clerks in order to find out how many there are.

Lawyers are confronted in their dealings with such a maze of legislation of this character.

They have no trouble with respect to congressional legislation. The rules and decisions of these commissions, the rules of practice, et cetera, now comprise a dozen volumes or more-20 volumes, I believe. And we have such a complex situation that it is absolutely impossible for the honest lawyer to say what the law is; and we have so far departed from our constitutional division system of legislative, executive, and judicial character, until it is a maze of brambles through which even the bravest may not hope to pass unscathed. I should like to extend my remarks.

Mr. SADOWSKI. Thank you.

Mr. DAVIS. Before adjourning, upon behalf of the Federal Trade Commission, I wish to express our appreciation for the privilege of appearing before you in these hearings.

Mr. SADOWSKI. We wish to thank you, Judge, for the fine presentation you made here today.

The committee stands adjourned and the hearings are closed.
Mr. REECE. Except for these additional statements.

Mr. SADOWSKI. Except the additional statements that are to appear

by those witnesses who could not come personally.

EXTENSION OF THE REMARKS OF JAMES F. HOGE SUBMITTED AT CLOSE OF HEARINGS, MARCH 11, 1946

[From Bartlett's Familiar Quotations, eleventh edition]

No one should be judge in his own cause (p. 988, Maxim 545).

It is not permitted to the most equitable of men to be a judge in his own cause (p. 1047; Thoughts, ch. 4, 1, by Blaise Pascal 1623–62).

EXCERPT FROM A SPEECH, ADMINISTRATIVE AGENCIES AND THE LAW, BY ROSCOE POUND, DEAN EMERITUS OF HARVARD LAW SCHOOL, PRINTED IN WOMEN LAWYERS JOURNAL, SPRING EDITION, 1945

One of the most serious features of administrative adjudication is that administrative agencies act as judges in cases in which they are also prosecutors and so in effect act as judges in their own cases. Many of these agencies entertain complaints, institute investigations upon them, begin what are in effect prosecutions before themselves, allow their own subordinates to act as advocates for the prosecution, and often make the adjudications in conference with those same subordinates (p. 6).

EXCERPTS FROM AN ADDRESS DELIVERED BY UNITED STATES CIRCUIT JUDGE JOHN D. MARTIN, OF TENNESSEE, TO THE JUDICIAL CONFERENCE FOR THE SIXTH CIRCUIT ON OCTOBER 18.

(American Bar Association Journal, December 1945, vol. 31, p. 625)

No more startling innnovation has come about within the past decade than the widespread building up of administrative tribunals in derogation of the judicial power, which some of us have thought was firmly vested by the Constitution in the courts alone.

Our practical function in the review of rulings of administrative boards has been reduced to reading records for possible discovery of that rare case wherein there is no evidence, however slight, from which the Board could reasonably have drawn inferences upon which a finding of fact was based.

EXCERPT FROM STATEMENT OF REPRESENTATIVE HATTON W. SUMNERS,
MARCH 9, 1946

Washington bureaucrats can now go to the average citizen with powers and authorities that no king ever possessed. For they make the rules which have the force of law. They construe the rules. They enforce the rules. And no citizen, practically speaking, has the power to resist.

By concentration of governmental power and drafts upon the Federal Treasury, we have now a financially "busted," great, piled-up mass of governmental confusion beyond human comprehension, impossible of democratic control, extravagant, wasteful, inefficient, and by its nature the instrumentality of favoritism tyranny, oppression, and corruption, and the destroyer of the self-reliance and self-respect and governmental capacity of the people, qualities without which no people can remain free.

EXCERPTS FROM A LETTER WRITTEN BY MR. CHIEF JUSTICE D. LAWRENCE GRONER, FORMER CHIEF JUSTICE OF THE CIRCUIT COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA

Hon. ROBERT H. JACKSON,

Attorney General of the United States, Washington, D. C. DEAR MR. ATTORNEY GENERAL:

*

*

*

*

I shall state my propositions generally and in the briefest possible form. First In general, the administrative officer or officers charged with the duty of enforcing a regulatory statute should be separate and distinct from the officer or tribunal charged with the duty of passing judgment upon alleged violations thereof.

Referring back, then, to my first proposition, I think it both correct and fair to say that the whole committee recognizes the plain undesirability of commingling the function of investigation or advocacy with the function of decision. The respective recommendations are nevertheless strikingly inadequate to remove and cure this defect. The majority insist that separation of functions may be

satisfactorily accomplished within the agency itself by creating the office of hearing commissioner with the salary, tenure, and powers proposed. The separate views of three members doubt this and urge complete separation, but in view of the difficulties inherent in such an undertaking, accept temporarily the hearing commissioner plan with the additional provision for slightly greater independence. Thus, in each plan, the commissioner is made a part of and subordinate to the several agencies, and his decision, both on the facts and on the law, is subject to the determination of the agency of which he is a part. The initial findings of fact and the initial decision is his, but the final decision on both the facts and the law is that of the agency, and while his decision may often receive due consideration, the power exists to ignore it and set aside both as to facts and law; and in those cases in which the power is exercised, with no right of a review of the facts anywhere, present unsatisfactory conditions are left wholly unchanged. The controversy, in such circumstances is finally adjudged and determined by the agency which has initiated and conducted the prosecution, and this, I think, is not only wrong but in the teeth of the principle that separation of the legislative, executive, and judicial is an essential condition of liberty.

Judicial review of administrative decisions might be expanded to include a review of the findings in the light of the weight of the evidence, just as a trial judge may set aside a jury's verdict on this ground. The opposition to this plan is generally based on the theory that it would create delay, increase the number of appeals, and clog the court dockets. Experience alone could prove whether this objection has any foundations, but the plan is unquestionably against the present trend of administrative legislation and would provoke the antagonism of many who now oppose any factual review of administrative decisions by the courts. I mention the method only to pass it by.

The correct decision of this question is one of immense importance. It should, in my opinion, be considered by Congress in the light of the real and true purposes which the founders of our Government sought to achieve for themselves and their posterity. These were free action-free enterprise-free competition. They believed that equal justice between man and man and between citizen and State was one of the impartial rewards which encouraged to efforts that produced great and lasting results. Therefore, they made no provision for exemptions from legal duty. What they did provide for was that there should be no oppression, no exaction by tyranny, no spoliation of private right by public authority, and that there should be a fair, honest, effective Government to maintain the things which were thought to be the prerogatives of every individual man.

In the immense expansion of governmental authority, these principles should be the guiding star to a determination of this vexed question.

D. LAWRENCE GRONER. (Report of the Committee on Administrative Procedure, 77th Cong., 1st sess., Senate Document No. 8, pp. 248-250.) [Italics here added.]

EXCERPT FROM THE REPORT OF THE COMMITTEE ON THE JUDICIARY ON S. 7, SEVENTYNINTH CONGRESS, FIRST SESSION, NOVEMBER 19, 1945 (S. REPT. No. 752, p. 30)

The "substantial evidence" rule set forth in section 10 (e) is exceedingly important. As a matter of language, substantial evidence would seem to be an adequate expression of law. The difficulty comes about in the practice of agencies to rely upon (and of courts to tacitly approve) something less-to rely upon suspicion, surmise, implications, or plainly incredible evidence. It will be the duty of the courts to determine in the final analysis and in the exercise of their independent judgment whether on the whole record the evidence in a given instance is sufficiently substantial to support a finding, conclusion, or other agency action as a matter of law. In the first instance, however, it will be the function of the agency to determine the sufficiency of the evidence upon which it acts— and the proper performance of its public duties will require it to undertake this inquiry in a careful and dispassionate manner. Should these objectives of the bill as worded fail, supplemental legislation will be required. [Ittalics added.] (NOTE. The foregoing refers to the court review section in the McCarran bill and demonstrates clearly the unsatisfactory construction now put by agencies and courts upon the substantial evidence rule. It is in the nature of "giving the