Federal Power Commission v. Metropolitan Edison Co

• Citation: 304 U.S. 375,82 L.Ed. 1408,58 S.Ct. 963
• Decision Date: 23 May 1938
• Docket Number: No. 915,915
• Parties: FEDERAL POWER COMMISSION v. METROPOLITAN EDISON CO. et al
• Court: U.S. Supreme Court

304 U.S. 375

58 S.Ct. 963

82 L.Ed. 1408

FEDERAL POWER COMMISSION

v METROPOLITAN EDISON CO. et al.

No. 915.

Argued May 2, 1938.

Decided May 23, 1938.

Messrs. Homer S. Cummings, Atty. Gen., and Oswald Ryan, of Washington, D.C., for petitioner.

Messrs. Walter Biddle Saul, of Philadelphia, Pa., and Edward F. Huber, of New York City, for respondents.

Mr. Chief Justice HUGHES delivered the opinion of the Court.

On January 6, 1936, the Federal Power Commission instituted an investigation to determine the 'conditions, practices, and matters regarding the ownership, operation, management, and control' of the respondent corpora- tions. The order directed respondents to file with the Commission copies of contracts and statements of working arrng ements between respondents and persons controlling them, and statements of charges on respondents' books for 1934 and 1935 representing payments made and obligations incurred to such persons. Respondents were also directed to make their books, records, etc., available for examination by the Commission's representatives. The investigation was instituted on representations of the Governor and Public Service Commission of Pennsylvania.

Respondents challenged the jurisdiction of the Commission to make the order, and, reserving their right to question its legality, they furnished various data and information. Following an examination of the books and records of respondents, the Commission's examiners submitted a report on December 10, 1936.

Thereupon the Commission on January 26, 1937, made an order providing that a hearing should be held on March 3, 1937. The order recited that the respondents had reported charges appearing upon their books which represented payments made and obligations incurred to named persons as (a) 'conceded affiliates' and (b) 'not conceded affiliates,' respectively; that the examination of the books and records of respondents and of admitted affiliates disclosed transactions between respondents and additional named persons, and that the accounting representatives of the Commission had submitted a report indicating that certain named persons 'control respondents, or are controlled by the same persons which control respondents.' The order then directed respondents to appear at the hearing, as stated, and to present information bearing upon the question of control and specifically showing (1) their form of organization, respectively, (2) their articles of incorporation, partnership agreements or other documents of organi- zation, (3) the names and addresses of partners, directors, officers, trustees and agents, (4) the ownership held by such persons 'in or over any other person named above,' as well as the manner by which such ownership was maintained, and (5) such other data as might from time to time be required by the Commission. The order further directed that a copy of the report prepared by the accounting representatives of the Commission should be served on each person named, and the Commission gave notice that the hearing would be had by the Commission sitting jointly with the Public Service Commission of Pennsylvania. See Federal Power Act, § 209(b), as amended by Act Aug. 26, 1935, § 213, 49 Stat. 853, 16 U.S.C.A. § 824h(b).

Respondents then filed with the Commission a petition for rehearing as to the order of January 26, 1937, asking for the vacating of that order and the termination of the proceeding initiated by the order of January 6, 1936. Respondents contended that the Commission lacked jurisdiction to conduct an investigation concerning the propriety of contracts and working arrangements between respondents and third persons, and, in particular, (1) that the Commission was without power to investigate for the purpose of supplying information to a state commission for use in local proceedings for violations of local law, and, (2) that as to three of the respondents the Commission was without jurisdiction of their persons because they were not 'public utilities' as defined in the Federal Power Act.

The Commission thereupon adjourned without day the hearing directed by the order of January 26, 1937. Later, the Commission granted the petition for rehearing and assigned 'the matters involved' for hearing on April 14, 1937. Respondents then appeared and introduced evidence tending to support their objections to the Commission's jurisdiction. The Commission's counsel then in- troduced evidence on its behalf. Respondents objected to its admissibility upon the ground that it was immaterial to the issues presented by the petition for rehearing. Their objection was overruled and respondents then asked the examiner to certify to the Commission the request to define the issues to be determined on the petition for rehearig and to instruct its representatives that no evidence in furtherance of the orders of January 6, 1936, and January 26, 1937, be introduced. The examiner refused and respondents then presented a like request to the Commission, which was denied on April 20, 1937, for the reason that its rules of practice did not provide for that method 'of interim review of the examiner's rulings.' Upon remand to the examiner, he again ruled against respondents, stating that their rights could 'be amply protected by the usual method of exceptions' and argument thereon.

Respondents then presented, on April 21, 1937, to the Circuit Court of Appeals a petition asking for a rule to show cause why the Commission should not be restrained from taking any steps in furtherance of the inquiry under the orders of January 6, 1936, or of January 26, 1937, until the petition for rehearing had been disposed of, and from introducing any evidence except that which was relevant to the questions raised by the petition for rehearing. The Circuit Court of Appeals, on July 6, 1937, issued the rule to show cause, as prayed, returnable on October 4, 1937, and on September 7, 1937, granted a temporary stay. The Commission made its return to the rule and asked for a dismissal of the petition. The Circuit Court of Appeals rendered its decision on January 27, 1938. Its decree remanded the case to the Commission 'for determination in accordance with the opinion' of the court and restrained the Commission 'from proceeding with its proposed inquiry and investigation in accordance with its two orders of January 6, 1936, and January 26, 1937, until the questions raised in the petition for rehearing are determined by it.'

In its opinion the court stated that the only issues of fact raised by the petition for rehearing and the evidence of the respondents were that three of the respondents were not 'public utilities' as defined by the Federal Power Act and that the purpose of the investigation was to supply information to the Pennsylvania Commission for use in local proceedings designed to impose penalties under the state law. 3 Cir., 94 F.2d 943, 945. The court said (page 946):

'Coming to the merits of the case, when the petition was filed and granted it was the plain duty of the Federal Commission to determine the issues raised in the petition. We are going to remand the case for such determination. In doing so the evidence admitted should be strictly confined to the two issues raised in the petition and not extended to the scope of the investigation proposed in the orders of January 6, 1936, and January 26, 1937. The relation of the evidence to the two questions involved should be apparent and logical and not far-fetched and remotely inferential. Some of the evidence admitted when the case was before the Federal Commission on rehearing was not relevant and material. If both sides will seek to produce only such evidence as is clearly admissible, we venture to hope that the determination of the issues will be speedy, final and satisfactory.

'In remanding the case, we express no opinion on the merits of the questions to be decided. The determination of them is for the Federal Commission under relevant and competent evidence. The act has provided a review by this court of the orders of the Federal Commission, and no order on the merits is now before us. These proceedings were taken so that the questions would not be moot if and when they come here.'

This Court granted certiorari, 304 U.S. 553, 58 S.Ct. 947, 82 L.Ed. —-, and the cause has been argued. We are of the opinion that the Circuit Court of Appeals had no jurisdiction to enter the decree.

First.—There was no order of the Commission before the Circuit Court of Appeals for review. Apart from the question whether the order of January 6, 1936, or that of January 26, 1937, can be regarded as reviewable, no application for such a review had been made.

The provision conferring appellate jurisdiction on the Circuit Court of Appeals i r elation to orders of the Federal Power Commission is found in section 313 of the Federal Power Act, as amended by the Act of August 26, 1935, c. 687, § 213, 49 Stat. 860, 861, 16 U.S.C.A. § 825l.¹ Section 313(a) provides that any person aggrieved by an order of the Commission may apply for a rehearing within thirty days after its issuance and that no proceeding to review any order of the Commission shall be brought unless there has been an application for a rehearing thereon.

Respondents say that under this provision they could not ask review of the order of January 26, 1937, until they had sought a rehearing. They did seek a rehearing and it was granted N o appeal from the order granting it would lie and none was attempted. Respondents do not contend that there was any appeal from an order, or any application for a review of an order, pending before the Circuit Court of Appeals. On the contrary, respondents say that the Commission 'has never passed upon the objections raised in respondents' petition for rehearing with respect to the order of January 26, 1937'; that 'concededly, the minute of the Commission granting a rehearing did not purport to decide the objections raised in the petition...