Soundview Pulp Co. v. Taylor

• Citation: 21 Wn.2d 261,150 P.2d 839
• Decision Date: 22 July 1944
• Docket Number: 29297.
• Parties: SOUNDVIEW PULP CO. v. TAYLOR, Commissioner of Public Lands of Washington. STATE ex rel. COOS BAY PULP CORPORATION v. SAME. COOS BAY PULP CORPORATION v. SAME.
• Court: United States State Supreme Court of Washington

150 P.2d 839

21 Wn.2d 261

SOUNDVIEW PULP CO. v. TAYLOR, Commissioner of Public Lands of Washington.

STATE ex rel. COOS BAY PULP CORPORATION v. SAME.

COOS BAY PULP CORPORATION v. SAME.

No. 29297.

Supreme Court of Washington, En Banc.

July 22, 1944

Action by Soundview Pulp Company against Jack Taylor, as Commissioner of Public Lands of the State of Washington, for a determination of rights consolidated with an action for writ of mandate by the State of Washington, on the relation of Coos Bay Pulp Corporation, against Jack Taylor, as Commissioner of Public Lands of the State of Washington, and with an action for a determination of rights and for a permanent injunction by Coos Bay Pulp Corporation against Jack Taylor, as Commissioner of Public Lands of the State of Washington. From a decree directing the Commissioner of Public Lands to accept a bid of the Coos Bay Pulp Corporation and consummate sale of timber to it, the Commissioner of Public Lands appeals.

Reversed and remanded with instructions.

BLAKE STEINERT, and ROBINSON, JJ., dissenting.

Appeal from Superior Court, Thurston County; John M. Wilson, judge.

Smith Troy and R. A. Moen, both of Olympia, for appellant.

Bogle Bogle & Gates and Robert W. Graham, all of Seattle, for respondent Coos Bay Pulp Corporation.

Robert C. Finley, of Olympia, Stanley C. Soderland, of Seattle, and Thomas I. Emerson, Fleming James, Jr., and Abraham Glasser all of Washington, D. C., and George H. Layman, of Seattle amici curiae for O. P. A.

GRADY Justice.

Originally three actions were commenced against Jack Taylor as Commissioner of Public Lands: one by the Soundview Pulp Company, one by the State of Washington on the relation of Coos Bay Pulp Corporation, and another by the latter corporation in its own behalf. In this opinion the parties will be referred to as Soundview, respondent and appellant, respectively.

Soundview had been the highest bidder at a public sale of timber grown on state school lands, but was informed by the Office of Price Administration that its bid was in excess of the ceiling price for the timber as provided under Maximum Price Regulation 460 and that if it consummated the purchase the Price Administrator would hold it responsible for a violation of the Emergency Price Control Act of 1942, 50 U.S.C.A. Appendix, § 901 et seq., Executive Order No. 9250, 50 U.S.C.A. Appendix, § 901 note and the regulation. Soundview deposited the amount of its bid with the appellant. Being unwilling to incur the risks of penalties and possible criminal actions for violation of the act and the regulation, Soundview on December 1, 1943, brought an action against the appellant praying that he be required to refrain from paying the money deposited into the state treasury and not consummate a sale of the timber to it until the United States could be allowed to intervene in the action and the court determine whether the bid was lawful. A temporary restraining order was issued returnable at a subsequent date. The appellant demurred to the complaint. The United States did not make an appearance in the action.

On December 7, 1943, the respondent in the name of the state filed an affidavit and application for a writ of mandate to be directed to appellant commanding him to accept its bid for the timber, which bid was in a less amount than that of Soundview, but was for the maximum price fixed by the Office of Price Administration for the timber, and consummate a sale thereof to respondent. An alternative writ was issued. Issues of law and fact were tendered by appellant by demurrer and return to the application and reply.

On December 16, 1943, respondent filed its complaint praying for the same relief as asked in its mandamus proceeding, and in addition that the court determine and declare its rights, status and other legal relations with reference to the subject matter involved and for a permanent injunction restraining appellant from consummating a sale to Soundview of the timber in question. A temporary restraining order was issued. Issues of law and fact were tendered by appellant by demurrer and answer and reply. All parties entered into a written stipulation to consolidate the cases for trial and an order was entered accordingly.

After the conclusion of the trial the court made a written decision and later made findings of fact, conclusions of law and decree sustaining the validity of Maximum Price Regulation 460, adjudging that the total of the bids of respondent was the highest lawful bid made at the sale and directing the appellant to accept the bids and consummate a sale of the timber to the respondent. The decree enjoined appellant from accepting the bids of Soundview and consummating a sale of the timber to it and directed appellant to return the check of Soundview deposited with him as payment for the timber.

The appellant has taken an appeal from the decree. Soundview has not appeared in this court. Permission was given by this court to the Office of Price Administration to appear as amicus curiae, file a brief, and present oral argument; also further permission was given to it to file a supplemental brief.

The material facts necessary to a decision of this case are as follows:

The State of Washington is the owner in its sovereign and governmental capacity of Section 36, Township 36 North, of Range 5, E. W. M., in Skagit County and became such pursuant to the Enabling Act by which it was admitted as one of the United States. On September 15, 1943, the War Production Board issued a 'Directive' to the appellant asking that the timber on the south half of section 36 be made available for sale on or Before October 19, 1943. Pursuant to an application made by respondent for the appraisement and sale of the timber on the south half of section 36 the appellant caused the timber on all of the section to be appraised and gave notice that it would be sold at public auction to the highest bidder on November 23, 1943; that the sale would be made by the Auditor of Skagit County at the court house in the City of Mount Vernon. At the time and place fixed in the notice the Auditor offered the timber on each quarter section for sale. Soundview and respondent were the only bidders. The figures we use are the collective sums for the four quarter sections. Soundview was the highest bidder. Respondent made claim that notwithstanding the bids that had been made the only legal maximum bid that could be made was the ceiling price fixed by the Office of Price Administration, which was $77,853.25.

The appraised value of the timber was $60,354.50. The bid of Soundview was $86,342.39, and that of respondent $86,342.35. The Auditor declared that Soundview was the highest bidder and accepted its check in the amount of its bid. Respondent tendered a check to the Auditor in the sum of $77,853.25. The Auditor received both checks and sent them with his report of the sale to appellant. The appellant returned respondent's check to it, notified both bidders that Soundview was the successful bidder and that he intended to confirm a sale to Soundview.

The question to be determined by us is whether the appellant had the legal right to make a sale of the timber at a price in excess of the maximum price fixed by the Office of Price Administration.

By the terms of the Enabling Act upon the admission of Washington into the Union sections numbered 16 and 36 in every township therein were granted to it for the support of common schools and it was provided that all lands thereby granted for educational purposes should be disposed of only at public sale and at a price not less than $10 per acre, the proceeds to constitute a permanent school fund, the interest of which only should be expended in the support of such schools.

By § 2 of Art. XVI of the state constitution it is provided that 'None of the lands granted to the state for educational purposes shall be sold otherwise than at public auction to the highest bidder; and the value thereof, less the improvements, shall, Before any sale, be appraised by a board of appraisers, to be provided by law, the terms of payment also to be prescribed by law, and no sale shall be valid unless the sum bid be equal to the appraised value of said land. * * *'

By § 3 it is provided that the timber off any of the state lands may be sold in such manner and on such terms as may be prescribed by law. By legislative enactment the procedure for the sale of the land or the timber separate therefrom is prescribed.

On or about January 30, 1942, the Emergency Price Control Act of 1942 became effective. 56 Stat. 23, 50 U.S.C.A. Appendix, § 901 and subsequent sections. Its territorial field of operation covers the United States, its territories and possessions and the District of Columbia. Its stated purpose is in general as follows: '* * * to stabilize prices and to prevent speculative, unwarranted, and abnormal increases in prices and rents; to eliminate and prevent profiteering, hoarding, manipulation, speculation, and other disruptive practices resulting from abnormal market conditions or scarcities caused by or contributing to the national emergency; to assure that defense appropriations are not dissipated by excessive prices; to protect persons with relatively fixed and limited incomes, consumers, wage earners, investors, and persons dependent on life insurance, annuities, and pensions, from undue impairment of their standard of living; to prevent hardships to persons engaged in business, to schools, universities, and other institutions, and to the Federal, State, and local governments, which would result from abnormal increases in prices; * * *.'

The Office of Price Administration is created and is given broad powers in determining at what prices...