Crary v. Porter

• Decision Date: 29 October 1946
• Docket Number: No. 13384.,13384.
• Citation: 157 F.2d 410
• Parties: CRARY et al. v. PORTER, Price Administrator.
• Court: U.S. Court of Appeals — Eighth Circuit

157 F.2d 410 (1946)

CRARY et al. v. PORTER, Price Administrator.

No. 13384.

Circuit Court of Appeals, Eighth Circuit.

October 4, 1946.

Rehearing Denied October 29, 1946.

C. Floyd Huff, Jr., of Hot Springs, Ark. (Q. Byrum Hurst, of Hot Springs, Ark., on the brief), for appellants.

Albert M. Dreyer, Chief, Appellate Branch, Office of Price Administration, of Washington, D. C. (George Moncharsh, Deputy Administrator for Enforcement, David London, Director, Litigation Division, and Karl E. Lachmann, Atty., Office

of Price Administration, all of Washington, D. C., on the brief), for appellee.

Before SANBORN, THOMAS, and JOHNSEN, Circuit Judges.

JOHNSEN, Circuit Judge.

The action is one by the Price Administrator, under section 205(e) of the Emergency Price Control Act of 1942, as amended, 50 U.S.C.A.Appendix, § 925(e), for damages against appellants, as partners, on account of overcharges on 51 shipments of Southern Pine lumber, from July to October, 1945, under section 5(e) of amended Second Revised Maximum Price Regulation 19, 9 Fed.Reg. 1162, 2916. At the close of all the evidence the court sustained the Administrator's motion for a directed verdict against appellants in the sum of $2,788.82, the amount of the overcharges — the Administrator having conceded in connection with the motion that the situation was not one in which increased or multiple damages should be assessed.

Section 5(e) of the Regulation, as then in force, provided: "(e) Inspection certificates required on sales of certain grades. Any shipment of Southern pine lumber priced in Tables 1, 2, 3A, 7, 14, 15, 16A and 21 which does not bear the grade mark of a qualified inspection agency as provided in Federal Specification MM-L-751c (May 20, 1942), must either be accompanied by a certificate of inspection by inspection agency, which has been accepted as satisfactory by any Federal purchasing organization, or be inspected by an inspector from the Federal organization making the purchase, if the shipment contains either (1) 30% No. 1 common and higher grades, or (2) 15% C and higher grades, or (3) 10% B and better. The certificate of inspection must cover all lumber in the shipment. In the absence of such a certificate, where the lumber is not grade marked as specified above, lumber invoiced as No. 1 Common and higher grades in any such shipment may not be sold at prices higher than the prices provided in such tables for No. 2 Common."

Federal Specification MM-L-751c, referred to in the Regulation, which was a part of Federal Standard Stock Catalog, Section IV (Part 5) "Federal Specification for Lumber and Timber," made all lumber associations whose grading rules had been approved by the Central Committee on Lumber Standards as in conformance with "American Lumber Standards," or bureaus of such associations, qualified inspection agencies. According to the evidence, the Southern Pine Inspection Bureau of the Southern Pine Lumbermen's Association was such a qualified inspection agency.

The invoices of appellants, which were put in evidence by the Administrator, showed that each of the shipments involved had consisted of more than 30% No. 1 Common and higher grades of lumber. The evidence further established that none of the shipments (all of which were civilian purchases) had been grade-marked or inspected and certified to by a qualified inspection agency, but the lumber in each instance had been graded by appellants' own inspector and priced to the purchaser on the basis of this grading, the same as if the shipment had been accompanied by a certificate of a qualified inspection agency. There was no attempt to prove any incorrectness in the grading or any complaint from a purchaser, but the Regulation did not allow lumber invoiced as No. 1 Common and higher grades to be sold at prices higher than those fixed for No. 2 Common, if it was not accompanied by the prescribed inspection certificate.

The first contention for reversal is that the court was not entitled to direct a verdict for the Administrator, because the evidence showed that appellants had acted in good faith. It is argued that section 205(d) of the Act, 50 U.S.C.A.Appendix, § 925(d), exempts a seller from liability for violating a price regulation, if he has acted in good faith. Appellants have misread the language and purpose of this section of the statute. The section provides that "No person shall be held liable for damages or penalties * * * on any grounds for or in respect of anything done or omitted to be done in good faith pursuant to any provision of this Act or any regulation, order, price schedule, requirement, or agreement thereunder * * * notwithstanding that subsequently such provision, regulation, order, price schedule, requirement, or agreement may be modified, rescinded, or determined to be invalid. * * *". Clearly, this provision has application only to things done pursuant to or in conformity with the Emergency Price Control Act and not to things done contrary to or in violation of it, whether in good or bad faith. As the report of the Senate Committee on Currency and Banking declared, Sen.Rep. 931, 77th Cong., 2d Sess., at the time the statute was enacted, "of course Section 205(d) does not confer any immunity upon any person who violates any such provision, regulation, order or requirement." See also Bowles v. Indianapolis Glove Co., 7 Cir., 150 F.2d 597, 600; Bowles v. Franceschini, 1 Cir., 145 F.2d 510, 512-514; Schreffler v. Bowles, 10 Cir., 153 F.2d 1, 4. For any violation of a price regulation, the liability in damages is governed by section 205(e), as amended, 50 U.S.C.A.Appendix, § 925(e), and under that section good faith is in no way a defense to the recovery of overcharges but is relevant only on whether and how much the recovery should be increased beyond that amount in achieving the purposes of the Act. Cf. Speten v. Bowles, 8 Cir., 146 F.2d 602; Shearer v. Porter, 8 Cir., 155 F.2d 77; Bowles v. Franceschini, 1 Cir., 145 F.2d 510, 513, 514.

Appellants' second contention is that the Regulation is too ambiguous for understanding and compliance, in that there was "no way of knowing by what inspection agency or by whom the lumber should be inspected." But if appellants did not know what qualified inspection agency there was in the territory and did not have access to Federal Specification MM-L-751c, referred to in the Regulation, they manifestly could have sought information from the nearest OPA office. District Courts and Circuit Courts of Appeals may not refuse to enforce an applicable price regulation with which compliance is not utterly impossible. The reasonableness or unreasonableness of a price-regulation's requirements, as a question of its validity, is a matter that the statute has relegated to the jurisdiction of the Emergency Court of Appeals subject only to review by the Supreme Court. 50 U.S.C.A.Appendix, § 924; Yakus v. United States, 321 U.S. 414, 427-431, 64 S.Ct. 660, 88 L.Ed. 834; Speten v. Bowles, 8 Cir., 146 F.2d 602, 605; Superior Packing Co. v. Porter, 8 Cir., 156 F.2d 193, 195.

The third contention is that the trial court erred in compelling H. A. Crary, one of appellants, over his objection, to take the witness stand. When the Administrator attempted to call Crary as a witness, he refused to take the stand on the ground that under the Fifth Amendment he could not be compelled to be a witness against himself. His theory, while not clearly expressed in the record, apparently was that the demand in the Administrator's complaint for treble damages (which as we have indicated was withdrawn at the close of all the evidence) made the action in the nature of one for a criminal penalty. His brief here quotes the fourth syllabus point from Lees v. United States, 150 U.S. 476, 14 S.Ct. 163, 37 L.Ed. 1150, that "An action to recover a penalty under the Act of February 26, 1885, 23 Stat. 332, prohibiting the importation of aliens under contract to perform labor in the United States, though in form a civil action, is unquestionably criminal in its nature, and the defendant cannot be compelled to be a witness against himself." The trial court ruled that the present action was wholly remedial and civil in nature and that Crary's privilege therefore did not extend to the right to refuse to take the stand generally but only to answer any specific question which might tend to incriminate him. The error, if any, in this ruling would, of course, be one that would be available only to Crary himself and not to the other appellants. The ruling, however, was in our opinion clearly correct.

The question involved is merely whether Congress intended the provision for...