Binkley Mining Co. v. Wheeler, 12367.

• Decision Date: 05 March 1943
• Docket Number: No. 12367.,12367.
• Citation: 133 F.2d 863
• Parties: BINKLEY MINING CO. OF MISSOURI v. WHEELER, Acting Director, Bituminous Coal Division, Department of the Interior, et al.
• Court: U.S. Court of Appeals — Eighth Circuit

133 F.2d 863 (1943)

BINKLEY MINING CO. OF MISSOURI v. WHEELER, Acting Director, Bituminous Coal Division, Department of the Interior, et al.

No. 12367.

Circuit Court of Appeals, Eighth Circuit.

February 10, 1943.

Rehearing Denied March 5, 1943.

Henry Adamson, of Terre Haute, Ind. (Russell Blair and Lloyd C. Adamson, both of Terre Haute, Ind., on the brief), for petitioner.

Raymond G. Irvine, Chief, Compliance Proceedings Unit, Bituminous Coal Division, United States Department of Interior, of Washington, D. C. (Warner W. Gardner, Solicitor, United States Department of Interior, Arnold Levy, Gen. Counsel, and Jesse B. Messitte, Asst. Gen. Counsel, and Harry I. Rand and Erwin B. Ellmann, Dennis J. Lindsay, Attys., Bituminous Coal Division, United States Department of Interior, all of Washington, D. C., on the brief), for respondents.

Before SANBORN, WOODROUGH and THOMAS, Circuit Judges.

WOODROUGH, Circuit Judge.

The petition for review in this case is presented by the Binkley Mining Company of Missouri, a Code Member under the Bituminous Coal Act of 1937. It feels itself aggrieved by the order of June 4, 1942, of the Director of the Bituminous Coal Division of the Department of the Interior directing petitioner to cease and desist from selling or offering to sell coal produced by it at less than the applicable effective minimum prices established therefor, contrary to the provisions of the Bituminous Coal Code and rules, regulations and applicable price schedule thereunder. The order imposed no penalties and the Director has not applied for any order of enforcement but the petitioner feels that the Director had no right under the circumstances presented to hear or consider the charge which had been preferred against it and that his decision and order are not in conformity with the Act and are not supported by substantial evidence. Petitioner is accorded the right of review in this court by Section 6(b) of the Bituminous Coal Act, 15 U.S.C. A. § 836(b), and as its petition presents the first instance of a review in this court of a trial and action taken by the Director against a Code Member for alleged wilful violation of the Bituminous Coal Code, both parties have briefed and argued the important questions for decision with great care and thoroughness.

The statute involved is the Bituminous Coal Act of 1937, approved April 26, 1937, c. 127, 50 Stat. 72-91, 15 U.S.C.A. §§ 828-851, and extended by amendment April 11, 1941, 55 Stat. 134, 15 U.S.C.A. § 849 et seq.

The Act as initially passed was to be administered by the National Bituminous Coal Commission. However, the functions of administration of the Act were transferred from the National Bituminous Coal Commission to the Department of the Interior by Act of June 7, 1939, Reorganization Plan No. II, § 4(a) and (b), Public Res.No.20, 53 Stat. 813, 1431, 5 U.S.C.A. §§ 133s, 133t (pursuant to authority granted in the Reorganization Act of 1939, Pub. No.19, 76th Cong., 1st Sess., approved April 3, 1939, 53 Stat. 561, 5 U.S.C.A. § 133 et seq). Pursuant to order of the Secretary of the Interior, the Bituminous Coal Division is, with exceptions not here pertinent, the successor to all functions of the National Bituminous Coal Commission. (Order No. 1399 of the Secretary of the Interior, dated July 5, 1939).

The Supreme Court epitomized the objects and provisions of the Act for discussion and establishment of its constitutionality in Sunshine Anthracite Coal Co. v. Adkins, 310 U.S. 381, 60 S.Ct. 907, 84 L. Ed. 1263, and to clarify discussion of the points here presented it is further observed that the Act provides that producers of bituminous coal may accept membership in the Bituminous Coal Code. Producers accepting such membership are required to abide by the minimum prices established for the coals produced at their mines and to conduct their business in a manner consistent with the trade practice provisions of the Act and regulations issued thereunder. The Act imposes a 19½ percent tax on all sales of bituminous coal covered by the statute but provides that the tax shall not be applicable to the sales of coal by producers who are members of the Bituminous Coal Code. The requirements for admission into the Code are detailed in Section 4 of the Act.

Pursuant to the statutory direction contained in Section 4 Part II of the Act, the Director, following lengthy public hearings, promulgated schedules of effective minimum prices for the coals produced by Code Members in the various production districts. Coincident with the establishment of minimum prices, the Director issued marketing rules and regulations designed to implement the minimum prices by controlling various aspects of the sale of coal.

Section 4 II (e) provides that the sale or delivery or the making of a contract for the sale of coal by code members at a price below the minimum established by the Division shall constitute a violation of the code.¹ A schedule of Effective Minimum Prices for District No. 15 for All Shipments Except Trucks was established and in effect from October 1, 1940, to March 31, 1941, providing in Price Instruction No. 9 Part I:

"Domestic and Commercial Use and Industrial Use.

"(a) Prices shown for Domestic and Commercial Use apply (1) on all sales in retailing of coal. (2) On all sales of coal to consumers using coal principally for space heating. (3) On all other sales except Industrial Use as provided for in Part II Special Purpose Use and Part III Railroad Locomotive Fuel Use.

"(b) Prices in the Industrial Use Schedule apply only where sale is made by the Producer Code Member, his authorized agent, or a registered wholesaler or jobber and where the coal moves direct from the mine of the producer to the consumer using the fuel principally for (1) the purpose of driving steam engines or turbines, (2) the purpose of manufacturing or processing if fuel is required each day of the year products of the consumer are produced."

Section 4 II (j) authorizes the Division to hear and determine written complaints made by certain parties charging any violation of the Code specified in Section 4 Part II and to make such orders as the facts and the circumstances warrant.²

Section 5 (b) provides that upon written complaint by any code member, district board,³ State or political subdivision of a State, or the Consumers' Counsel, the Division, after a hearing with thirty days' written notice to the code member and "upon proof that such code member has wilfully violated any provision of the code or any regulations made thereunder," may revoke his code membership or, in its discretion, may order the code member to cease and desist from violations.⁴

Section 6 (a) makes all the regulations and determinations of the district boards subject to review by the Division upon proper appeal to it, and provides that in the event a district board fails for any reason to take action authorized or required of it under the Act, then the Division may take such action in lieu of it.⁵ Certain actions of the district boards are subject to supervision of the Division by the provisions of Sections 4 I (a) and 4 I (b), 15 U.S.C.A. § 832 (a, b).

Section 6 (b) provides in part that "the finding of the Commission Director as to the facts, if supported by substantial evidence, shall be conclusive", upon review thereof by the Circuit Court of Appeals.

Statement.

Although the record before us discloses that there were two complaints against the petitioner, each charging sales of coal by it in violation of the Code at different times to different customers, and that the Examiner heard evidence as to both at the same time and reported as to both in the same report, and that the Director acted upon both at the same time and in the same cease and desist order, the petitioner has filed separate petitions for review. This petition in No. 12,367 is for review of the Director's action, in so far as it is based on the complaint, proceedings, evidence and report respecting only the sales by petitioner to its customer, Western Tablet and Stationery Company of St. Joseph, Missouri.

On June 12, 1941, Bituminous Coal Producers' Board for District No. 15, through its secretary, H. V. Blackburn, filed its complaint against petitioner in which it alleged upon its own knowledge and on information supplied by E. J. Lytton, Consuming Area Auditor, Bituminous Coal Division, Department of the Interior, that the Code Member, Binkley Mining Company, wilfully violated the provisions of the Code and the effective minimum prices by selling approximately 540 tons of Bee-Veer 1" washed mill coal from October 1, 1940 to March 31, 1941, produced at Bee-Veer Mine, Macon County, Missouri, to Western Tablet and Stationery Company, located at St. Joseph, Missouri, shipped via rail to St. Joseph, Missouri, at $1.63 per ton, f. o. b. the mine, that this alleged violation was accomplished by "giving/offering" a price 12 cents less than the prescribed minimum price; that the following is a more detailed description of the alleged violation: Coal sold to Western Tablet and Stationery Company, St. Joseph, Missouri, a commercial concern, at the industrial price of $1.63 per ton. The complaint contained a prayer that the membership of the member be revoked or that in the discretion of the Division the member be directed to cease and desist from violations of the Code. Section 4 II (e) of the Act and of the Code provides, as indicated, that no coal subject to the code shall be sold or delivered or offered for sale "at a price below the minimum * * * therefor established by the Commission, and the sale * * * of coal at a price below such minimum * * * shall constitute a violation of the code"; and the specification of the acts in the complaint sufficiently charged a wilful violation.

On consideration of the complaint the Director ordered that a public hearing in respect to its subject matter be held on September 10, 1941, and caused notice to be...