Krug v. Fox

• Court: U.S. Court of Appeals — Fourth Circuit
• Writing for the Court: PARKER, SOPER, and DOBIE, Circuit
• Citation: Krug v. Fox, 161 F.2d 1013 (4th Cir. 1947)
• Decision Date: 22 May 1947
• Docket Number: No. 5594.,5594.
• Parties: KRUG, Secretary of the Interior, et al. v. FOX.

161 F.2d 1013 (1947)

KRUG, Secretary of the Interior, et al. v. FOX.

No. 5594.

Circuit Court of Appeals, Fourth Circuit.

May 22, 1947.

J. Francis Hayden, Sp. Asst. to Atty. Gen. (John F. Sonnett, Asst. Atty. Gen., Wayne T. Brooks, U. S. Atty., and Howard Caplan, Asst. U. S. Atty., both of Clarksburg, W. Va., and John Ford Baecher, Sp. Asst. to Att. Gen., on the brief), for appellants.

Kermit R. Mason, of Morgantown, W. Va., for appellee.

Before PARKER, SOPER, and DOBIE, Circuit Judges.

PARKER, Circuit Judge.

This is an appeal from an order granting an interlocutory injunction in a suit against the Secretary of the Interior of the United State, the Coal Mines Administrator, the Administrator's Comptroller and the Resident Officer in Charge of Fox Coal Company Mine Number 3 in the Northern District of West Virginia. The complaint alleged that plaintiff was the owner of that coal mine, that the defendants were operating it in defiance of the property rights of plaintiff and in an improper manner and that plaintiff was in grave danger of suffering irreparable damage. The prayer of the complaint was that defendants be restrained from interfering in the operation of the mine by plaintiff, that they be required to return same to his possession, and that the court determine sundry question connected with its seizure and operation. The order granting the interlocutory injunction restrained defendants from further interfering with the property of plaintiff and directed that they immediately return to him the mine that they had seized. Appeal was promptly taken from the order and its operation was suspended by this Court pending the appeal.

The facts are that, because of the general bituminous coal strike beginning April 1, 1946, the President of the United States issued Executive Order No. 9728 on May 21, 1946, authorizing the Secretary of the Interior to take possession of and operate any or all of the bituminous coal mines of the country. This order was issued by the President as Commander-in-Chief of the Army and Navy under the authority of Section 9 of the Selective Training and Service Act of 1940, 50 U.S.C.A.Appendix, § 309, as amended by the War Labor Disputes Act, 50 U.S.C.A.Appendix, § 1503. The Secretary of the Interior issued orders on May 21 and 27, 1946, taking possession of most of the bituminous coal mines, but inadvertently omitting a few including the mine of plaintiff. On August 2, 1946, however, he issued another order, to become effective August 5, 1946, taking possession of 71 additional bituminous mines, including the mine of plaintiff, and reciting that the causes for the existing or threatened labor disturbances which prevailed at the time of the Executive Order still prevailed at these mines.

The order of August 2nd provided that the regulations of the Coal Mines Administrator should apply to the mines seized under the order and designated the president or chief executive officers of the mining companies operating them as operating managers for the United States, with provision that each officer so designated should be deemed to have accepted the designation unless he gave notice to the contrary within ten days. Plaintiff was thus designated operating manager of his mine and did not protest within the ten day period. Thereafter difficulties arose, and plaintiff asked to be relieved of his duties as operating manager, but continued to act in this capacity for a number of months. After the seizure of mines under the Executive Order, an agreement, known as the Krug-Lewis Agreement, was entered into between the Secretary of the Interior and the United Mine Workers of America, regulating wages and terms and conditions of employment on a nationwide basis in the mines which had been seized; and, following the seizure of the 71 mines on August 5th, this agreement was made applicable to them and orders were issued by the Coal Mines Administrator to that effect. Plaintiff as operating manager for the United States of his mine failed to comply with these orders in that he failed and refused to make payments to the welfare and retirement fund which had been established, to check off union dues from wages and to reinstate an employee found by an umpire to have been wrongfully discharged. Because of this refusal to obey orders, he was discharged as operating manager of the mine as of midnight on January 5, 1947, and a naval officer was designated by the Coal Mines Administrator to take over in his stead and has since been in charge.

The plaintiff filed suit in the court below on January 11, 1947. Motions to dismiss and to quash were filed by defendants on the ground that the court lacked jurisdiction of the subject matter, as the action was in effect one against the United States, and that the defendants, other than the resident officer in charge of the mine, were not citizens of West Virginia and were not served with process in that state. The court withheld a ruling on the motions until after hearing evidence on the merits and then held that the suit was not one against the United States and that the venue and service of process were proper. He found that the plaintiff's mine was not seized by defendants until January 1947, that the seizure was unwarranted, that the mine was being improperly operated by defendants and that, if they were allowed to continue in possession and operation thereof, plaintiff would suffer irreparable damage. He signed an order granting the interlocutory injunction prayed and directing defendants to return the property to plaintiff.

The crucial question presented for our decision is whether the possession and operation of the mine by officers of the government is lawful. If it is not lawful, the court unquestionably has jurisdiction of the cause to enjoin encroachment on plaintiff's property rights by those within the territory of its jurisdiction who are acting outside the law. Philadelphia Co. v. Stimson, 223 U.S. 605, 32 S.Ct. 340, 56 L.Ed. 570; State of Colorado v. Toll 268 U.S. 228, 45 S.Ct. 505, 69 L.Ed. 927. If it is lawful, however, the Court is without jurisdiction of the cause for reasons which we shall point out hereafter. We think it clear that the possession and operation were lawful.

In war time, the President of the United States, as Commander in Chief of the Army and Navy, has under our Constitution, and must have, vast powers for the carrying on of the war effort, not only over the military establishment of the country but also over its civilian economy. In addition to the power over the operation of the coal mines, so obviously necessary to the proper prosecution of the war effort, which might be thought to arise out of constitutional provisions without legislation, he was expressly authorized by statute to seize and operate "any plant, mine, or facility equipped for the manufacture, production, or mining of any articles or materials which may be required for the war effort or which may be useful in connection therewith", and to exercise such power through any department or agency of the government that he might designate, "whenever the President finds, after investigation, and proclaims that there is an interruption of the operation of such plant, mine, or facility as a result of a strike or other labor disturbance, that the war effort will be unduly impeded or delayed by such interruption, and that the exercise of such power and authority is necessary to insure the operation of such plant, mine, or facility in the interest of the war effort." Sec. 9 of Selective Training and Service Act of 1940, 54 Stat. 892, as amended by the War Labor Disputes Act, 57 Stat. 164, 50 U.S.C.A.Appendix, §§ 309, 1503. No question is made, and none could reasonably be made, as to the constitutionality of this statute; and there can be no question, of course, as to bituminous coal being required for the war effort, or being "useful in connection therewith". As to the finding and proclamation by the President, that is contained in Executive Order No. 9728, and is as follows:

"* * * after investigation I find and proclaim that there are interruptions or threatened interruptions in the operation of the mines producing bituminous coal as a result of existing or threatened strikes and other labor disturbances; that the coal produced by such mines is required for the war effort and is indispensable for the continued operation of the national economy during the transition from war to peace; that the war effort will be unduly impeded or delayed by such interruptions; and that the exercise, as hereinafter specified, of the powers vested in me is necessary to insure the operation of such mines in the interest of the war effort and to preserve the national economic structure in the present emergency."

The Secretary of the Interior was authorized by this order of the President to take possession of and operate all the bituminous coal mines of the country; and, as heretofore stated, he did seize and take possession of the mine of plaintiff on August 5th. There can be no question, we think, as to the validity of such seizure or as to the validity of the subsequent exercise of power in the operation of the mine by officers of the government. United States v. United Mine Workers of America, 67 S.Ct. 677. Since the power exercised by the President through the Secretary of the Interior was clearly authorized by statute, which did not offend constitutional provisions, it is not necessary to decide whether, in the absence of such statutory authorization, the power would have existed under the Constitution alone. See United States v. Montgomery Ward & Co. 7 Cir. 150 F.2d 369, 380 et seq.; Ken-Rad Tube & Lamp Co. v. Badeau, D.C., 55 F.Supp. 193, 197.

The learned judge below was of opinion that there was no seizure of the property until January 1947, when plaintiff was ousted as manager, and when the mine could not be lawfully seized because of the termination of hostilities as of ...