LAMBERT'S POINT DOCKS, INC. v. Kendall

• Decision Date: 28 June 1955
• Docket Number: No. 668.,668.
• Citation: 224 F.2d 284
• Parties: LAMBERT'S POINT DOCKS, Inc. v. Charles H. KENDALL, Assistant Director, Office of Defense Mobilization.
• Court: U.S. Temporary Emergency Court of Appeals Court of Appeals

224 F.2d 284 (1955)

LAMBERT'S POINT DOCKS, Inc. v. Charles H. KENDALL, Assistant Director, Office of Defense Mobilization.

No. 668.

United States Emergency Court of Appeals.

Heard May 18, 1955.

Decided June 28, 1955.

W. R. Ashburn, Norfolk, Va., with whom Frank E. Sellers and Sellers & Underwood, Norfolk, Va., were on the brief for complainant.

Katherine Hardwick Johnson, Attorney, Department of Justice, Washington, D. C., with whom Warren E. Burger, Asst. Atty. Gen., and Edward H. Hickey, Chief General Litigation Section, Department of Justice, Washington, D. C., and James A. Durham, Special Counsel, and Pauline B. Heller, Special Counsel, Office of Defense Mobilization, Washington, D. C., were on the brief for respondent.

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

Heard at Washington, D. C., May 18, 1955.

MAGRUDER, Judge.

Though it is to be regretted at this late stage in the proceeding, we are constrained to the conclusion that the complaint must be dismissed for lack of jurisdiction.

The case comes to us by direct complaint under § 408(d) (1) of the Defense Production Act of 1950, as amended, 66 Stat. 303, 50 U.S.C.A.Appendix, § 2108, pursuant to leave granted to complainant by order of a United States District Court. As provided in § 408(d) (1), such leave may be granted, under defined conditions, to file a complaint in the Emergency Court of Appeals challenging the validity of any provision of a price regulation which the defendant is charged in the enforcement court with having violated. Upon the due filing of such a complaint, the Emergency Court of Appeals is vested with exclusive jurisdiction to enjoin or set aside the provision of the regulation or order complained of or to dismiss the complaint. Obviously, therefore, the jurisdiction of this court on a complaint under § 408(d) (1) is strictly limited to a determination of the validity of the provision of the regulation or order which the defendant in the enforcement proceeding is charged with having violated; we cannot on such a complaint consider the validity of any other regulation or order of the Director of Price Stabilization even though the complaint filed in this court may ask us to do so.

Lambert's Point Docks, Inc., complainant herein, operates a marine terminal at Norfolk, Virginia, at which it is engaged in the furnishing to carriers by rail, water, and motor vehicle, of terminal, wharfage, loading and unloading services at fixed charges.

On June 26, 1952, the United States filed its complaint against Lambert's Point Docks Inc., in the United States District Court for the Eastern District of Virginia, Norfolk Division, to recover damages on account of overcharges for the terminal services alleged to have been made during the period June 1, 1951, to June 21, 1952, in violation of Ceiling Price Regulation 34 (16 F.R. 4446) issued May 11, 1951, effective five days later, by the Director of Price Stabilization under authority of the Defense Production Act.

Ceiling Price Regulation 34, which was a general freeze-type regulation of maximum charges for miscellaneous services, contained this provision (16 F.R. 4447):

"Sec. 2. Services covered. This regulation covers all services except:

"(a) Services exempted in the GCPR, as amended".

The general Ceiling Price Regulation, thus referred to, contained the following provision (16 F.R. 814):

"Sec. 14. Exemptions and exceptions. This regulation does not apply to the following:

* * * * * *

"(f) Rates charged by any common carrier or other public utility".

Under the statutory scheme, the court having an enforcement proceeding before it has the jurisdiction and the duty to determine all questions of fact or law bearing on whether the defendant therein is subject to the regulation as properly interpreted, and whether the defendant has violated the ceiling prices, if applicable. It is the special function of the Emergency Court of Appeals to pass on questions as to the validity of a price regulation or order; and it is merely as incidental to the performance of that special function that in certain situations we have occasion to interpret the meaning of the regulation or to determine whether it is applicable to a particular person or class of persons, as explained in Fast v. DiSalle, Em.App., 1951, 193 F.2d 181, 184, 185. Referring to § 204(e) of the Emergency Price Control Act of 1942, as amended, 58 Stat. 639, which was the provision of that Act corresponding to § 408(d) of the Defense Production Act of 1950, as amended, we said in Conklin Pen Co. v. Bowles, Em. App., 1946, 152 F.2d 764, 766:

"A case brought to this court under Section 204(e) (1) of the Act is in quite a different category from a case brought under the protest procedure. Such a case is not in any true sense an appeal from an action of the Price Administrator but, on the contrary, is merely ancillary to another suit which has been brought against the complainant in another court. In such a case the jurisdiction of the Emergency Court of Appeals is invoked by the complainant only with leave of the court in which the litigation is pending. It is invoked primarily for the purpose of enabling the complainant to establish the invalidity of the regulation involved in that litigation as a defense to be presented in that court. See Section 204(e) (2) of the Act. Except for the prohibition of Section 204(d) the defense could and would have been established in the primary court. But the complainant still has full opportunity to raise in that court the question of the applicability of the regulation to him and have it there judicially decided. Accordingly we have held in such a case that this court will accept the construction which the enforcement court has placed upon the regulation in question and will consider merely its validity as thus interpreted. Collins v. Bowles, Em. App., 1946, 152 F.2d 760."

It seems therefore clear that the United States District Court, before which the enforcement suit brought by the United States was pending, had the duty of interpreting CPR 34, which defendant Lambert's Point Docks, Inc., was charged with violating, to determine whether the defendant's charges at its marine terminal were subject to the regulation as written; and that would involve a determination whether the defendant was exempt as a "common carrier or other public utility" within the meaning of § 14 of the General Ceiling Price Regulation. Of course the United States, in the enforcement suit, has asserted that Lambert's Point Docks, Inc., is not a "public utility" within the meaning of the exemption; but the district court is not bound to assume the correctness of the interpretation of the regulation as asserted by the plaintiff in the enforcement action; a question of law is thus presented as to which the enforcement court would have to make its own independent determination. See Fast v. DiSalle, supra, 193 F.2d at page 184.

It so happens in this case that the exemption in the regulation was expressed in the exact terms of the exemption contained in § 402(e) (v) of the Defense Production Act of 1950, 64 Stat. 806, which provided that the price control authority conferred by the Act should not be exercised with respect to rates "charged by any common carrier or other public utility".¹ It must be assumed that the exemption provision of the regulation was intended to be coextensive with the statutory exemption; this, indeed, the respondent concedes. Therefore, the inquiry whether Lambert's Point Docks, Inc., is a "public utility" within the meaning of the regulatory exemption poses the identical issue that would be presented if the question to be decided were whether the company is a "public utility" within the meaning of the statutory exemption. But though this coincidence exists in the particular circumstances presented, it is nonetheless true that the United States District Court must necessarily make a judicial interpretation of the regulatory exemption, in its possible application to the defendant in the enforcement proceeding, before that court can properly give judgment holding the defendant liable in damages for having made overcharges in violation of the provisions of CPR 34. And if the defendant should claim that the judgment of the district court is erroneous in that respect, the point can be presented and determined on appeal to the Court of Appeals for the Fourth Circuit. Cf. Massy v. Kendall, Em.App., 1954, 209 F.2d 250; Massy v. United States, 8 Cir., 1954, 214 F.2d 935; Massy v. Kendall, Em.App., 1954, 217 F.2d 319. See also Bowles v. Chicago Cartage Co., D.C.N.D.Ill.1946, 71 F.Supp. 92, affirmed sub nom. Fleming v. Chicago Cartage Co., 7 Cir., 1947, 160 F.2d 992.

In the present case we gather from the complaint before us that the district court has never made any judicial interpretation of the regulatory exemption in order to determine whether the defendant's charges at its marine terminal were excluded by the regulation itself from the operation of CPR 34. Upon the contrary it appears that the district court acted upon the view, an erroneous one, we believe, that it had no power to determine this question of interpretation, since the Director of Price Stabilization, and the United States in the enforcement suit, had asserted that the defendant was not a "public utility" within the meaning of the exemption. Acting on this view, the district court entered a final judgment against defendant for damages, on the mere assumption that the defendant was subject to the regulation; and thereafter entered an order granting leave to the defendant to file its complaint in the Emergency Court of Appeals, asking us to pass on this question of interpretation. But we do not believe...