George v. Mitchell

• Decision Date: 23 June 1960
• Docket Number: No. 15555.,15555.
• Parties: R. C. GEORGE, d/b/a Capitol Coal Sales, Capitol Coal Sales, Inc.; and Raymond Asbury, et al., d/b/a Asbury Coal Company, Appellants v. James P. MITCHELL, Secretary of Labor, et al., and Joseph Campbell, Comptroller General, Appellees.
• Court: U.S. Court of Appeals — District of Columbia Circuit

282 F.2d 486 (1960)

R. C. GEORGE, d/b/a Capitol Coal Sales, Capitol Coal Sales, Inc.; and Raymond Asbury, et al., d/b/a Asbury Coal Company, Appellants v. James P. MITCHELL, Secretary of Labor, et al., and Joseph Campbell, Comptroller General, Appellees.

No. 15555.

United States Court of Appeals District of Columbia Circuit.

Argued May 6, 1960.

Decided June 23, 1960.

Petition for Rehearing Denied September 8, 1960.

As Amended October 14, 1960.

COPYRIGHT MATERIAL OMITTED

Messrs. Arthur G. Lambert, Washington, D. C., and Rourke J. Sheehan, Rockville, Md., for appellants. Mr. John P. Bankson, Jr., Washington, D. C., also entered an appearance for appellants.

Mr. David L. Rose, Attorney, Department of Justice, with whom Asst. Atty. Gen. George C. Doub, and Messrs. Oliver Gasch, U. S. Atty., Samuel D. Slade and Alan S. Rosenthal, Attorneys, Department of Justice, were on the brief, for appellees. Mr. Arthur H. Fribourg, Attorney, Department of Justice, also entered an appearance for appellees.

Before PHILLIPS, Senior United States Circuit Judge for the Tenth Circuit,^* and BAZELON and WASHINGTON, Circuit Judges.

Petition for Rehearing En Banc Denied September 8, 1960.

WASHINGTON, Circuit Judge.

Appellants brought suit against the Secretary of Labor, certain of his subordinates, and the Comptroller General of the United States, seeking a declaratory judgment by the District Court that certain contractual arrangements they had made with the Atomic Energy Commission were not within the coverage of the Walsh-Healey Act, 49 Stat. 2036 (1936), as amended, 41 U.S.C.A. §§ 35-45, because in their view there were six individual contracts each for an amount less than $10,000.¹ They also sought an injunction to restrain the Secretary and the Comptroller General from placing their names on the list of persons ineligible, by reason of violation of the Walsh-Healey Act, to be awarded Government contracts.² The District Court ruled that it had jurisdiction of the controversy, Capitol Coal Sales v. Mitchell, D.C.D.C.1958, 164 F.Supp. 161, and later entertained motions by both parties for summary judgment. The court granted the Government's motion, holding on the merits that the individual arrangements in question in fact constituted a single contract for an amount greater than $10,000 and hence the Act applied, and alternatively that one of the separate agreements was for more than $10,000. This appeal followed.

Appellants urge reversal, saying that the District Court erred in its holdings on the merits. The Government contends that the District Court lacked jurisdiction because appellants lacked standing to sue and the United States was not joined as a defendant, but that if jurisdiction existed the case was correctly decided on the merits.

I.

On the jurisdictional point, we must consider the extent to which Subsection (c) of the Fulbright Amendment³ to the Walsh-Healey Act has departed from the test of standing established in Perkins v. Lukens Steel Co., 1940, 310 U.S. 113, 60 S.Ct. 869, 84 L. Ed. 1108. Dealing with a steel company's effort to enjoin the Secretary of Labor from establishing under the Walsh- Healey Act certain wages as the prevailing minimum in a particular locality, the Supreme Court in Lukens denied standing because "no legal rights of respondents were shown to have been invaded or threatened." 310 U.S. at page 125, 60 S.Ct. at page 875. At that time there was no generally recognized procedure for reviewing determinations of the Secretary, and the Court noted particularly "the `confusion and disorder' that can result from the delays necessarily incident to judicial supervision of administrative procedure developed to meet present day needs of Government and capable of operating efficiently and fairly to both private and public interests." 310 U.S. at pages 130-131, 60 S.Ct. at page 878. In making available judicial review of Walsh-Healey determinations, Subsection (c) of the Fulbright Amendment provides:

"Notwithstanding the inclusion of any stipulations required by any provision of sections 35-45 of this title in any contract subject to said sections, any interested person shall have the right of judicial review of any legal question which might otherwise be raised, including, but not limited to, wage determinations and the interpretation of the terms `locality\', `regular dealer\', `manufacturer\', and `open market\'." 66 Stat. 308 (1952), 41 U.S.C.A. § 43a(c).

Appellees maintain that this language was not intended to confer standing, but was designed merely to assure that contract stipulations required by Walsh-Healey would not preclude review in an enforcement proceeding brought by the Attorney General, which the Government says is the only proceeding contemplated by Congress. We disagree.

The legislative history of the Fulbright Amendment evidences a multiplicity of congressional purposes, including an intent (1) to overrule the Lukens case insofar as it pertained to the Walsh-Healey Act, (2) to provide a set of procedures by which the Secretary of Labor may construe and apply the Walsh-Healey Act, (3) to vitiate or modify the effect of the Secretary's construction of the term "open market," and (4) to provide adequate judicial review of the Secretary's determinations. Nowhere does the legislative history suggest that Congress limited its consideration of judicial review to enforcement proceedings, or even that such proceedings were specifically considered. On the contrary, the original intent of Senator Fulbright, the circumstances of compromise which produced the ultimate Fulbright Amendment, the language of Subsection (c), the House Conference Report, and the case law all support the proposition that Subsection (c) of the Amendment authorizes persons situated as are the appellants here to seek declaratory or other relief. Senator Fulbright desired to overrule Lukens. See 98 Cong.Rec. 6246 (1952). The original Fulbright Amendment and the proposed Lehman Amendment would have permitted any person aggrieved plus certain other persons to obtain review of all general policy determinations prior to their implementation by the Secretary of Labor. See S. Rep. No. 1594, 82d Cong., 2d Sess. 36-37 (1952); Amendment by Senator Lehman to S. 2594, 82d Cong., 2d Sess. (June 3, 1952). A group including Senators Saltonstall, Morse, Bridges, Tobey, Ives, and Lodge rejected these amendments, but acquiesced in a substitute amendment by Senator Fulbright which eventually became law. See 98 Cong.Rec. 6530 (1952).

The Fulbright Amendment as enacted provides in Subsection (b) that the only general policy determinations reviewable prior to implementation are wage determinations. 66 Stat. 308 (1952), 41 U.S.C.A. § 43a(b). And only persons adversely affected or aggrieved are accorded standing. Ibid. But Subsection (c) provides that "any interested person shall have the right of judicial review of any legal question which might otherwise be raised, including, but not limited to, wage determinations and the interpretation of the terms `locality', `regular dealer', `manufacturer', and `open market'." 66 Stat. 308 (1952), 41 U.S.C.A. § 43a(c). Subsection (c) has reference to situations where a contract has been let of a sort covered (or alleged to be covered) by the Walsh-Healey Act. Thus, it would seem that under Subsection (c) the standard of "any interested person" is to replace the legal wrong criterion of Lukens, and "the right of judicial review of any legal question" is to be established once a dispute arises under a Government contract covered or alleged to be covered by the Walsh-Healey Act. The House Conference Report stated that the right might be exercised in "any appropriate proceeding." H.R.Conf.Rep. 2352, 82d Cong., 2d Sess. 27 (June 28, 1952). We have no doubt that a proceeding for declaratory judgment is appropriate and that appellants are interested parties. The Secretary has made a finding adverse to appellants, he threatens to place them on a Government blacklist, and no other adequate legal or administrative remedy is available. See Joint Anti-Fascist Refugee Committee v. McGrath, 1951, 341 U.S. 123, 71 S.Ct. 624, 95 L.Ed. 817; Stark v. Wickard, 1944, 321 U.S. 288, 309, 64 S.Ct. 559, 88 L.Ed. 733; but cf. Yakus v. United States, 1944, 321 U.S. 414, 64 S.Ct. 660, 88 L. Ed. 834.

Nor do we believe the suit should have been dismissed because the United States was an indispensable party and could not be joined. Insofar as the suit sought to prevent the Secretary of Labor, his subordinates, and the Comptroller General from blacklisting appellants, it was maintainable against them. To be sure, the Secretary's authority to blacklist is based on the same statute which authorizes the United States to collect liquidated damages, and appellant raises issues which apply equally to the power of the Secretary and the rights of the United States. "The government's interest must be determined in each case `by the essential nature and effect of the proceeding, as it appears from the entire record.'" Mine Safety Appliances Co. v. Forrestal, 1945, 326 U.S. 371, 374, 694, 66 S.Ct. 219, 221, 90 L.Ed. 140. Where the effect of a private suit is to compel or increase the disbursement of public funds, as — for example — by preventing the Treasury from withholding challenged payments, courts have held the United States to be an indispensable party. Mine Safety Appliances Co. v. Forrestal, supra (withholding based on alleged excess profits); see also Stroud v. Benson, 4 Cir., 1958, 254 F.2d 448 (price supports). But where the suit is one to enjoin regulatory administrative action not involving disbursement of funds to a private claimant, the United States does not ordinarily have a sufficient interest to require joinder. See Block, Suits Against Government Officers and the Sovereign Immunity Doctrine, 59 Harv.L.Rev. 1060 (1946). This case falls in the latter category. If successful, the suit would not increase...