Buka Coal Co. v. Brown, 4.

• Decision Date: 01 February 1943
• Docket Number: No. 4.,4.
• Parties: BUKA COAL CO. v. BROWN, Price Administrator.
• Court: U.S. Temporary Emergency Court of Appeals Court of Appeals

133 F.2d 949 (1943)

BUKA COAL CO. v. BROWN, Price Administrator.

No. 4.

United States Emergency Court of Appeals.

Decided February 1, 1943.

Walter K. Sibbald, of Cincinnati, Ohio, for complainant.

Ben W. Heineman, Chief Court Review Branch (David Ginsburg, Gen. Counsel, Thomas I. Emerson, Associate Gen. Counsel, Nathaniel L. Nathanson, Asst. Gen. Counsel, and Edward Rubin and Mavis M. Clark, all of Washington, D. C., on the brief), all of the Office of Price Administration, for respondent.

Before VINSON, Chief Judge, and MARIS and MAGRUDER, Judges.

MAGRUDER, Judge.

The Buka Coal Company on June 27, 1942 filed with the Price Administrator, under § 203 of the Emergency Price Control Act of 1942, 50 U.S.C.A.Appendix, § 923, its protest setting forth objections to § 1340.209 of Maximum Price Regulation No. 120 and to § 1340.252 of Maximum Price Regulation No. 122, issued on April 28, 1942 and April 29, 1942, respectively. On July 27, 1942 the Administrator entered his order dismissing the protest upon the ground that the protestant had made no showing, as required by the Act, that it was subject to the specific provisions objected to. On August 25, 1942 the company, claiming to be aggrieved by the denial of its protest, filed a complaint in this court under § 204 of the Act, 50 U. S.C.A.Appendix, § 924.

Complainant is a corporation engaged in the retailing of bituminous coal at Cincinnati, Ohio. The objections it seeks to raise are somewhat complicated in nature, involving the interaction of minimum prices for bituminous coal established by the Bituminous Coal Division of the Department of the Interior and maximum prices for the same commodity established by the Administrator under the Price Control Act.

The Bituminous Coal Act of 1937, 50 Stat. 72, 15 U.S.C.A. § 828 et seq., empowers the Bituminous Coal Division to establish minimum prices at which producers who become members of the Coal Code and distributors¹ may sell coal. On October 1, 1940 the Bituminous Coal Division published its Schedule Of Effective Minimum Prices For District No. 8 For All Shipments Except Truck (5 F.R. 3117). The said schedule establishes minimum f.o.b. mine prices. When coal is sold f.o.b. destination for rail delivery the minimum price is determined by the established mine price plus freight. For "ex-river deliveries" the delivered minimum price is fixed by adding to the f.o.b. mine prices the all rail freight rate to the destination. The Bituminous Coal Division thus interpreted the Act as requiring it to coordinate the prices for coal so that the minimum delivered prices would be the same whether the coal moved by rail or by river. To this general policy the Bituminous Coal Division made an exception in the case of so-called "river (free alongside) deliveries," defined in the schedule as follows:

"`River (free alongside) deliveries', as used in this Schedule, means:

"(a) Deliveries in barges or other floating equipment alongside river docks or other barge unloading facilities to purchasers for consumption in their plants which adjoin such docks or other barge unloading facilities;

"(b) Deliveries in barges or other floating equipment to purchasers for consumption on floating equipment operated by them;

"(c) Deliveries in barges or other floating equipment alongside river docks or other barge unloading facilities to those retail dealers (not located in the Cincinnati, Louisville, Memphis, Chicago or Minneapolis-St. Paul areas as herein defined), for resale at retail, who operate such river docks or other barge unloading facilities and whose yard and storage facilities (in which the coal purchased free alongside is stored, when it is stored) adjoin such river docks or other barge unloading facilities; and

"(d) Deliveries to any person at the mine or at a point nearer the mine than the river docks or other barge unloading facilities for transportation in barges or other floating equipment to a purchaser who takes free alongside delivery, within the meaning of Item 1-(a) or Item 1-(c) above."

The minimum prices applicable to "river (free alongside) deliveries" are determined by adding to the minimum f.o.b. mine prices "not less than a reasonable charge for rail, truck, river or other transportation and handling to the point at which the purchaser takes possession of the coal." As appears from paragraph (c) above quoted, retail coal dealers along the Ohio River, except such dealers located in the Cincinnati and Louisville areas, who operate river docks or other barge unloading facilities, with adjoining yard and storage facilities, get the advantage of the lower delivered minimum prices applicable to "river (free alongside) deliveries." Such dealers may buy coal at the minimum mine price, take possession of it at the mine and transport it down the river in their own barges or by a common carrier, thereby profiting by the lower cost of water transportation. But retail coal dealers in Cincinnati or Louisville who have the described unloading and storage facilities which would otherwise qualify them to obtain river (free alongside) prices, are not permitted to pay for their coal the f.o.b. minimum mine price plus a reasonable charge for river transportation and handling. A schedule of prices applicable to this special class of dealers in Cincinnati and Louisville requires them to pay the minimum f.o.b. mine price plus the all rail freight rate to destination, less 60c a ton for the prepared sizes or 20c a ton for screenings. They thus must pay minimum prices lower than the minimum prices applicable generally for "ex-river deliveries" and higher than the low minimum prices for "river (free alongside) deliveries." It is urged that the tendency of the so-called "river rules" is to give to producer members of the Coal Code a monopoly in the Cincinnati area because of the competitive advantage they have in being able to bring their own coal down the river at the cheaper transportation rates prevailing in water-borne commerce.

These "river rules" have been under spirited attack and are now the subject of reexamination by the Bituminous Coal Division in pending proceedings in which protracted hearings have been held.

Such was the existing situation when the Administrator undertook to establish maximum prices under the Price Control Act.

In Maximum Price Regulation No. 120 the Administrator establishes specific maximum prices applicable to the sale of bituminous coal from a mine or preparation plant, whether the purchaser buys from the producer or from a distributor, and prohibits any person from buying or receiving bituminous coal so delivered at higher prices. The Administrator found it unnecessary to coordinate at destination the maximum prices of coal moved by rail and by river. The maximum prices for delivery at the mine or preparation plant are applicable "for shipment to all destinations for all uses and by all methods of transportation." If the regulations had stopped there, complainant urges that it would have been enabled to purchase coal at the mine at the set maximum prices and bring it to Cincinnati on the river by common carrier or private carrier or in its own barges, and thereby obtain the benefit of the lower water transportation cost.

The provision, and the only provision, in Maximum Price Regulation No. 120 against which complainant made a protest is § 1340.209 reading as follows:

"§ 1340.209. Other regulations. Nothing contained in this Maximum Price Regulation No. 120 shall be construed to excuse any violation of any provision of the Bituminous Coal Act or any schedules, regulations, rules, or orders now or hereafter made effective by the Bituminous Coal Division."

Complainant construes this section as providing in effect that wherever the maximum prices established in other sections of Regulation No. 120 prove to be less than the...