United States v. Morgan

Decision Date15 May 1939
Docket NumberNo. 221,221
Citation59 S.Ct. 795,307 U.S. 183,83 L.Ed. 1211
PartiesUNITED STATES et al. v. MORGAN et al. Re
CourtU.S. Supreme Court


[Syllabus from pages 183-185 intentionally omitted] Mr. Robert H. Jackson, Sol. Gen., for appellants.

Messrs. Frederick H. Wood, of New York City, and John B. Gage, of Kansas City, Mo., for appellees.

Mr. Justice STONE delivered the opinion of the Court.

On this appeal we are asked to determine the proper disposition to be made of a fund paid into the court below pending a suit instituted in that court to set aside an order of the Secretary of Agriculture reducing scheduled rates for services rendered at the Kansas City stockyards. The fund is made up of the difference between the scheduled rates and those prescribed by the Secretary's order, which was ultimately set aside by this Court in Morgan v. United States, 304 U.S. 1, 58 S.Ct. 773, 999, 82 L.Ed. 1129, without consideration of the merits, for failure of the Secretary to follow the procedure prescribed by the statute.

On June 14, 1933, the Secretary of Agriculture promulgated an order under the Packers and Stockyards Act, 1921, 42 Stat. 159, 7 U.S.C. §§ 181—229, 7 U.S.C.A. §§ 181—229, setting aside a schedule of maximum rates to be charged for stockyard services, filed by market agencies at the Kansas City stockyards, and prescribing a new and lower rate schedule for the future. In a suit brought in the District Court for Western Missouri by appellees, 24 F.Supp. 214, conducting market agencies at the Kansas City stockyards, to set aside the order as confiscatory and as having been rendered without procedural due process, the court on July 22, 1933, entered a temporary restraining order enjoining enforcement of the Secretary's order upon condition that appellees should 'deposit with the Clerk of this Court on Monday of each and every week thereafter while this order, or any extension thereof, may remain in force and effect and pending final disposition of this cause, the full amount by which the charges collected under the Schedule of Rates in effect exceeds the amount which would have been collected under the rates prescribed in the Order of the Secretary, together with a verified statement of the names and addresses of all persons upon whose behalf such amounts are collected by petitioner.' After two appeals we reversed the final decree of the district court, which had sustained the order of the Secretary. This Court held that he had not accorded to appellees the 'full hearing' which § 310 of the Act, 7 U.S.C.A. § 211, requires, and, without considering the merits, it remanded the cause for further proceedings. Morgan v. United States, 298 U.S. 468, 56 S.Ct. 906, 80 L.Ed. 1288; Id., 304 U.S. 1, 58 S.Ct. 773, 999, 82 L.Ed. 1129. A petition for rehearing, in part on the ground that the mandate of this Court had made no provision for the distribution of the fund paid into the district court pursuant to its restraining order, was denied in a memorandum opinion stating that the questions raised were appropriately for the district court, to which the cause had been remanded for further proceedings. The opinion added: 'We remand the case to the District Court for further proceedings in conformity with our opinion. What further proceedings the Secretary may see fit to take in the light of our decision, or what determinations may be made by the District Court in relation to any such pro- ceedings, are not matters which we should attempt to forecast or hypothetically to decide.' 304 U.S. pages 23, 26, 58 S.Ct. page 1001, 82 L.Ed. 1129. By this remand the Secretary was left free to take such further proceedings as the statute permits. Texas & Pacific Ry. Co. v. Interstate Commerce Commission, 162 U.S. 197, 238, 239, 16 S.Ct. 666, 682, 40 L.Ed. 940; Southern Railway Co. v. St. Louis Hay & Grain Co., 214 U.S. 297, 302, 29 S.Ct. 678, 680, 53 L.Ed. 1004; State of Florida v. United States, 292 U.S. 1, 9, 54 S.Ct. 603, 606, 78 L.Ed. 1077.

The Secretary thereupon, by order of June 2, 1938, reopened the original proceedings which had resulted in the challenged order of June 14, 1933. He directed that the 'Proceedings, Findings of Fact, Conclusion, and Order' of June 14, 1933, be served upon the appellee market agencies as his tentative findings and order, with an opportunity for appellees to file exceptions to them and to make oral argument upon the exceptions This action was followed, June 11, 1938, by the present proceeding, begun by motion of appellants in the district court to stay further proceedings there and to direct the clerk of the court to retain the impounded funds until such time as the Secretary, proceeding with due expedition, should have entered a final order in the proceedings reopened by him. This motion was denied, and from the order of the district court granting a counter-motion by appellees to distribute the fund among them, the case comes here on appeal.1 § 316 of the Packers and Stock yards Act, 42 Stat. 168, 7 U.S.C. § 217, 7 U.S.C.A. § 217; 38 Stat. 220, 28 U.S.C. §§ 47, 47a, 28 U.S.C.A. § 47, 47a; § 238(5) of the Judicial Code, 28 U.S.C. § 345(5), 28 U.S.C.A. § 345(5). This Court has stayed and superseded the order of the district court pending appeal. 305 U.S. 562, 59 S.Ct. 85, 83 L.Ed. —-. October 10, 1938.

The district court held that the fund should presently be distributed to appellees, both because the Secretary is without authority under the Act to make any order prescribing rates and charges which will be effective as of June 14, 1933, the date of his original order, and because it construed the terms of its own restraining order as requiring distribution of the fund to appellees on the final determination by this Court that the Secretary's order of June 14, 1933, was invalid. Thus, as a result of the litigation, the district court has twice sustained the determination of the Secretary that the rates prescribed by him, on the basis of voluminous evidence, were reasonable; but because of this Court's decision that the Secretary had failed to observe the statutory requirement of a full hearing, we have never reviewed that determination. The question now arises whether upon a redetermination of that issue by the Secretary the district court will have, and should exercise, the power to order distribution of the impounded fund in conformity to his determination by directing that so much, if any, of the amounts paid into court as exceeds the rates ultimately determined upon appropriate review of the Secretary's findings to be just and reasonable be returned to those who have paid them. This issue must be decided now, for unless the court will have such power there is no occasion to retain the fund pending further proceedings before the Secretary, and distribution of it must be made as the district court has directed.

Decision turns on the meaning and application of the provisions of the Packers and Stockyards Act, construed in the light of its dominant purpose to secure to patrons of the stockyards prescribed stockyard services at just and reasonable rates, and upon the authority and duty of the district court to effectuate that purpose in making disposition of the fund. Section 304 of the Act requires every stockyard owner and market agency to furnish non-discriminatory and reasonable stockyard services, and § 305 declares that 'All rates or charges made for any stockyard services furnished at a stockyard by a stockyard owner or market agency shall be just, reasonable, and non-discriminatory, and any unjust, unreasonable, or discriminatory rate or charge is prohibited and declared to be unlawful'. Section 307 makes a like requirement as to regulations and practices in respect to furnishing stockyard services. Section 306 makes it the duty of stockyard owners and market agencies to file with the Secretary a schedule of rates for stockyard services and to charge and collect such rates, unless they are set aside by appropriate action of the Secretary or changed by the filing of new rates as authorized by the section. Section 308(a) provides that any stockyard owner or market agency violating any of the previously mentioned sections shall be liable to the persons injured to the full extent of the damage sustained. Section 308(b) provides for enforcement of such liability either by complaint to the Secretary or by suit in any district court, and concludes with the declaration that 'this section shall not in any way abridge or alter the remedies now existing at common law or by statute, but the provisions of this (chapter) act are in addition to such remedies.' Section 310 authorizes the Secretary 'after full hearing' on complaint, or on his own initiative, to prescribe just and reasonable rates for the future.

Appellees insist that notwithstanding the command of § 305 that all rates shall be 'just, reasonable, and non-discriminatory', its mandate is effective only so far as implemented by the other sections of the Act; that except in a reparation case the statute forbids the Secretary to make orders affecting completed transactions, and that acting on his own initiative, as he does here, he can fix rates for the future only. They point out that under § 309(a) and (e) and § 310, any person aggrieved may, on petition to the Secretary, seek damages for the exaction of an unreasonable rate in the past, the naming of a new rate for the future, or both, but that when the Secretary institutes such proceedings on his own motion he is precluded by § 309(c) from making any order for the payment of money. As the original proceeding here and the action of the Secretary in reopening it were taken on his own motion, the conclusion is drawn that there can be no legal warrant for restitution of the impounded moneys to the patrons of the market agencies, even though the Secretary shall now determine, on evidence and by proper procedure, that the scheduled rates exceeded the reasonable rate prescribed by § 305.


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