Levers v. Anderson

• Decision Date: 05 November 1945
• Docket Number: No. 51,51
• Citation: 66 S.Ct. 72,90 L.Ed. 26,326 U.S. 219
• Parties: LEVERS v. ANDERSON, District Supervisor, Alcohol Tax Unit
• Court: U.S. Supreme Court

326 U.S. 219

66 S.Ct. 72

90 L.Ed. 26

LEVERS

v ANDERSON, District Supervisor, Alcohol Tax Unit.

No. 51.

Argued Oct. 16, 1945.

Decided Nov. 5, 1945.

Messrs. Huston Thompson and Hugh H. Obear, both of Washington, D.C., for petitioner.

Mr. Robert L. Stern, of Washington, D.C., for respondent.

Mr. Justice BLACK delivered the opinion of the Court.

The petitioner's permit to operate a wholesale liquor business under the Federal Alcohol Administration Act, 49 Stat. 977, 27 U.S.C.A. § 201 et seq., was annulled by an order of the District Supervisor of the Alcohol Tax Unit of the Bureau of Internal Revenue of the United States. At the same time the Supervisor denied petitioner's applications for an importer's and a new wholesaler's permit. The Supervisor was duly authorized to act in these matters.¹ Section 4(h) of the Act authorizes an applicant or permittee to appeal to the Circuit Court of Appeals within sixty days after the entry of orders denying or annulling the permits. A petition for appeal was filed within sixty days. The Circuit Court of Appeals dismissed the appeal, 10 Cir., 147 F.2d 547, on the ground that petitioner had failed to exhaust his administrative remedies since he had not first filed a motion for reconsideration of the Supervisor's order as permitted by Treasury Regulations, 26 C.F.R.Cum.Supp. 182.255, reading in part as follows:²

'(a) * * * Within 20 days after an order is made by the Commissioner or district supervisor revoking a basic permit, the permittee may file an application with such Commissioner or district supervisor, for a reconsideration of such order, on one or more of the following grounds:

'(1) The order is contrary to law, or

'(2) It is not supported by the evidence, or

'(3) Because of newly discovered evidence which the permittee, with due diligence, was unable to produce at the hearing.'

We thought the question involved important and granted certiorari.

Whatever might be the case in other circumstances, it is clear that where as here judicial review is provided in the Act itself, the petitioner's right of appeal to the courts is to be determined by looking to the statute, the valid regulations promulgated pursuant to it and proven administrative practice throwing light upon their meaning. In construing the Act, however, we must be mindful of the 'long-settled rule of judicial administration that no one is entitled to judicial relief for a supposed or threatened injury until the prescribed administrative remedy has been exhausted.' Myers v. Bethlehem Shipbuilding Corp., 303 U.S. 41, 50, 51, 58 S.Ct. 459, 463, 82 L.Ed. 638. But this rule does not automatically require that judicial review must always be denied where rehearing is authorized but not sought. This is shown by our past decisions,³ from which we see no reason to depart. Government counsel, appearing for respondent, do not defend the dismissal of petitioner's appeal on such a sweeping assumption. On the contrary, they assert that motions for rehearing before the same tribunal that enters an order are under normal circumstances mere formalities which waste the time of litigants and tribunals, tend unnecessarily to prolong the administrative process, and delay or embarrass enforcement of orders which have all the characteristics of finality essential to appealable orders.

But Government counsel insist that the rehearing here involved is far more than a formality, and that we should therefore read the Act and regulations as if these barred judicial review prior to an application for a rehearing.⁴ Of course we recognize that in a particular administrative pattern new opportunities to challenge afforded by the motion for rehearing may subject an order to such critical administrative review as to reduce it to the level of a 'mere preliminary or procedural' status, thereby divesting it of those qualities of administrative finality essential to invocation of judicial review. Federal Power Commission v. Metropolitan Edison Co., 304 U.S. 375, 384, 385, 58 S.Ct. 963, 967, 968, 82 L.Ed. 1408. But we do not think that is the case here.

The orders here challenged were entered after a hearing and they were 'of a definitive character dealing with the merits of a proceeding.' Federal Power Commission v. Metropolitan Edison Co., supra, 304 U.S. 384, 58 S.Ct. 967, 82 L.Ed. 1408. The evidence was taken before, and the findings of fact were made by, a hearing commissioner before whom petitioner was represented by counsel. These findings were then approved by the district supervisor who entered the orders. True the findings were approved and the orders were made by the district supervisor without an opportunity to petitioner to except to his adverse findings of fact or to present oral argument to him. And a rehearing if granted would have afforded petitioner for the first time an opportunity to see and except to adverse findings of fact and might also have given it a chance to present oral argument to the officer who made the orders. But the regulations only provide that the Supervisor 'may hear the application' for a rehearing.⁵ No other language of the regulations, and no satisfactory proof of publicly established practice under them, persuades us that the 'may' means must, or that the Supervisors were required to hear oral argument. Thus, despite the fact that the...