Yakus v. United States Rottenberg v. Same, Nos. 374

• Court: United States Supreme Court
• Writing for the Court: STONE
• Citation: 88 L.Ed. 834,64 S.Ct. 660,321 U.S. 414
• Parties: YAKUS v. UNITED STATES. ROTTENBERG et al. v. SAME
• Decision Date: 27 March 1944
• Docket Number: 375,Nos. 374

321 U.S. 414 64 S.Ct. 660 88 L.Ed. 834 YAKUS

v.

UNITED STATES. ROTTENBERG et al. v. SAME.

Nos. 374, 375. Argued Jan. 7, 1944. Decided March 27, 1944.

[Syllabus from pages 414-416 intentionally omitted]

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Mr. Leonard Poretsky, of Boston, Mass., for petitioners.

Mr. Joseph Kruger, of Boston, Mass., for petitioner in No. 374.

Mr. William H. Lewis, of Boston, Mass., for petitioners in 375.

Mr. Charles Fahy, Sol. Gen., of Washington, D.C., for respondent.

Messrs. Maxwell C. Katz, Otto C. Sommerich and Benjamin Busch, of New York City, amici curiae.

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Mr. Chief Justice STONE delivered the opinion of the Court.

The questions for our decision are: (1) Whether the Emergency Price Control Act of January 30, 1942, 56 Stat. 23, 50 U.S.C.App.Supp. II, § 901 et seq., 50 U.S.C.A. Appendix, § 901 et seq., as amended by the Inflation Control Act of October 2, 1942, 56 Stat. 765, 50 U.S.C.App.Supp. II, § 961 et seq., 50 U.S.C.A. Appendix, § 961 et seq., involves an unconstitutional delegation to the Price Administrator of the legislative power of Congress to control prices; (2) whether § 204(d) of the Act was intended to preclude consideration by a district court of the validity of a maximum price regulation promulgated by the Administrator, as a defense to a criminal prosecution for its violation; (3) whether the exclusive statutory procedure set up by §§ 203 and 204 of the Act for administrative and judicial review of regulations, with the accompanying stay provisions, provide a sufficiently adequate means of determining the validity of a price regulation to meet the demands of due process; and (4) whether, in view of this available method of review, § 204(d) of the Act, if construed to preclude consideration of the validity of the regulation as a defense to a prosecution for violating it, contravenes the Sixth Amendment, or works an unconstitutional legislative interference with the judicial power.

Petitioners in both of these cases were tried and convicted by the District Court for Massachusetts upon several counts of indictments charging violation of §§ 4(a) and 205(b) of the Act by the willful sale of wholesale cuts of best at prices above the maximum prices prescribed by §§ 1364.451—1364.455 of Revised Maximum Price Regulation No. 169, 7 Fed.Reg. 10381 et seq. Petitioners have not availed themselves of the procedure set up by §§ 203 and 204 by which any person subject to a maximum price regulation may test its validity by protest to and hearing before the Administrator, whose determination may be

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reviewed on complaint to the Emergency Court of Appeals and by this Court on certiorari, see Lockerty v. Phillips, 319 U.S. 182, 63 S.Ct. 1019, 87 L.Ed. 1339. When the indictments were found the 60 days period allowed by the statute for filing protests had expired.

In the course of the trial the District Court overruled or denied offers of proof, motions and requests for rulings, raising various questions as to the validity of the Act and Regulation, including those presented by the petitions for certiorari. In particular petitioners offered evidence, which the District Court excluded as irrelevant, for the purpose of showing that the Regulation did not conform to the standards prescribed by the Act and that it deprived petitioners of property without the due process of law guaranteed by the Fifth Amendment. They specifically raised the question reserved in Lockerty v. Phillips, supra, whether the validity of a regulation may be challenged in defense of a prosecution for its violation although it had not been tested by the prescribed administrative procedure and complaint to the Emergency Court of Appeals. The District Court convicted petitioners upon verdicts of guilty. The Circuit Court of Appeals for the First Circuit affirmed, 137 F.2d 850, and we granted certiorari, 320 U.S. 730, 64 S.Ct. 190.

I.

The Emergency Price Control Act provides for the establishment of the Office of Price Administration under the direction of a Price Administrator appointed by the President, and sets up a comprehensive scheme for the promulgation by the Administrator of regulations or orders fixing such maximum prices of commodities and rents as will effectuate the purposes of the Act and conform to the standards which it prescribes. The Act was adopted as a temporary wartime measure, and provides in § 1(b) for its termination on June 30, 1943, unless sooner

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terminated by Presidential proclamation or concurrent resolution of Congress. By the amendatory act of October 2, 1942, it was extended to June 30, 1944.

Section 1(a) declares that the Act is 'in the interest of the national defense and security and necessary to the effective prosecution of the present war', and that its purposes are:

'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, * * * and to the Federal, State, and local governments, which would result from abnormal increases in prices; to assist in securing adequate production of commodities and facilities; to prevent a post emergency collapse of values; * * *.'

The standards which are to guide the Administrator's exercise of his authority to fix prices, so far as now relevant, are prescribed by § 2(a) and by § 1 of the amendatory Act of October 2, 1942, and Executive Order 9250, 50 U.S.C.A.Appendix, § 901 note, promulgated under it. 7 Fed.Reg. 7871. By § 2(a) the Administrator is authorized, after consultation with representative members of the industry so far as practicable, to promulgate regulations fixing prices of commodities which 'in his judgment will be generally fair and equitable and will effectuate the purposes of this Act' when, in his judgment, their prices 'have risen or threaten to rise to an extent or in a manner inconsistent with the purposes of this Act.'

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The section also directs that

'So far as practicable, in establishing any maximum price, the Administrator shall ascertain and give due consideration to the prices prevailing between October 1 and October 15, 1941 (or if, in the case of any commodity, there are no prevailing prices between such dates, or the prevailing prices between such dates are not generally representative because of abnormal or seasonal market conditions or other cause, then to the prices prevailing during the nearest two-week period in which, in the judgment of the Administrator, the prices for such commodity are generally representative) * * * and shall make adjustments for such relevant factors as he may determine and deem to be of general applicability, including * * *. Speculative fluctuations, general increases or decreases in costs of production, distribution, and transportation, and general increases or decreases in profits earned by sellers of the commodity or commodities, during and subsequent to the year ended October 1, 1941.'

By the Act of October 2, 1942, the President is directed to stabilize prices, wages and salaries 'so far as practicable' on the basis of the levels which existed on September 15, 1942, except as otherwise provided in the Act. By Title I, § 4 of Executive Order No. 9250, he has directed 'all departments and agencies of the Government' 'to stabilize the cost of living in accordance with the Act of October 2, 1942.'¹

Revised Maximum Price Regulation No. 169 was issued December 10, 1942, under authority of the Emergency Price Control Act as amended and Executive Order No. 9250. The Regulation established specific maximum

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prices for the sale at wholesale of specified cuts of beef and veal. As is required by § 2(a) of the Act, it was accompanied by a 'statement of the considerations involved' in prescribing it. From the preamble to the Regulation and from the Statement of Considerations accompanying it, it appears that the prices fixed for sales at wholesale were slightly in excess of those prevailing between March 16 and March 28, 1942,² and approximated those prevailing on September 15, 1942. Findings that the Regulation was necessary, that the prices which it fixed were fair and equitable, and that it otherwise conformed to the standards prescribed by the Act, appear in the Statement of Considerations.

That Congress has constitutional authority to prescribe commodity prices as a war emergency measure, and that the Act was adopted by Congress in the exercise of that power, are not questioned here, and need not now be considered save as they have a bearing on the procedural

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features of the Act later to be considered which are challenged on constitutional grounds.

Congress enacted the Emergency Price Control Act in pursuance of a defined policy and required that the prices fixed by the Administrator should further that policy and conform to standards prescribed by the Act. The boundaries of the field of the Administrator's permissible action are marked by the statute. It directs that the prices fixed shall effectuate the declared policy of the Act to stabilize commodity prices so as to prevent war-time inflation and its enumerated disruptive causes and effects. In addition the prices established must be fair and equitable, and in fixing them the Administrator is directed to give due consideration, so far as practicable, to prevailing prices during the designated base period, with prescribed administrative adjustments to compensate...