Administrative Law Commons^™

The Proposed United States Administrative Court, Part Ii, Robert M. Cooper

Michigan Law Review

The recent movement for the passage of the Logan bill and the establishment of supervisory tribunals for the control of administrative determinations is the result of several preconceived theories concerning the shortcomings of the present system of administrative justice. These underlying theories, cautiously surrounded by a halo of judicial philosophy, have seldom been analyzed in their relation to the development of a sound policy for the administration of governmental functions. The present installment of this article will be devoted first to an examination of these fundamental theories and a consideration of the question how far the present administrative machinery is …

Commission Jurisdiction Over Utility Cooperatives, Israel Packel

Michigan Law Review

A group of farmers desire electricity. They propose to form a cooperative, to borrow money and to construct electric distribution lines. They probably will incorporate the cooperative as a stock or non-stock corporation in order to obtain the benefit of limited liability. The cooperative might be formed under a statute specifically enacted to authorize the formation of cooperatives or under a general incorporation statute. Normally, the charter of the cooperative will provide for equality in control by the members or shareholders and for a limited return or no return on capital investment. The cooperative will probably apply to the Federal …

The Proposed United States Administrative Court, Robert M. Cooper

Michigan Law Review

The last half century has witnessed a constant, almost relentless, increase of governmental responsibilities and services in both federal and state spheres of control. Due to the changing needs of our economic and social order, the desire for speedy, efficient and inexpensive settlement of controversies and the imperative need of specialized administrators, the task of performing these new functions has not infrequently been delegated to administrative tribunals or commissions. Neither the legislature nor the judiciary was capable of administering the myriad details or countless controversies which inevitably accompanied these new functions of government. As a consequence an administrative branch of …

Administrative Law - Johnson Act - Jurisdiction Of Federal Courts To Grant Injunctions Against Enforcement Of Rate Orders Of State Commissions, Donald L. Quaife

Michigan Law Review

Two years have elapsed since the passage of the Johnson Act restricting the jurisdiction of federal district courts to enjoin rate-making orders of state utility commissions; and the time is now ripe to survey the case law which has grown up under the act and to evaluate its results. It will be recalled that this statute came as the culmination of a long history of agitation to prevent federal court interference with what many believed to be a function which local state courts were better fitted to review. The interference aimed at had resulted from the amendment to the Judiciary …

Constitutional Law-Securities Act Of 1933-Right Of Registrant To Withdraw Registration Statement Filed With Commission

Michigan Law Review

Petitioner filed a registration statement with the Securities Exchange Commission covering a proposed issue of securities. After examining the statement, the commission concluded that it contained false and misleading information concerning certain material facts, and thereupon instituted a proceeding to compel petitioner to appear and answer certain questions pertinent to the papers filed. At the hearing, petitioner sought to withdraw the registration statement but was denied permission to do so. Upon application of the Securities Exchange Commission to the district court, an order was granted compelling petitioner to appear and answer the questions. On appeal to the Supreme Court of …

Administrative Law-Operation Of Federal Statute Creating Presumption Against Suicide In Compensation Cases

Michigan Law Review

A carpenter making repairs nearby, hearing a sharp report followed by groans, found plaintiff's husband lying upon the floor. He died without recovering consciousness from a bullet wound through the breast. The pistol to which the fatal bullet was traced lay in a partly closed drawer which was spattered with blood as was the counter near by. The ejected shell lay some feet away in the position where it would be found had the pistol been discharged directly in front of deceased's breast. There were powder burns on his clothes. Contradictory evidence of deceased's mental state was adduced toward the …

Constitutional Law-Agricultural Adjustment Act-The General Welfare Clause And The Tenth Amendment

Michigan Law Review

In what is without question the most important decision rendered in recent years the Supreme Court of the United States has swept away the legal basis of the Agricultural Adjustment Administration. The processing tax, an essential part of a plan for the control of production, has been ruled unconstitutional as involving an invasion of the powers reserved to the states. Unlike the case of Schechter Poultry Corporation v. United States, in which the National Industrial Recovery Act was held invalid by a unanimous Court, this pillar of the New Deal's vast recovery program was destroyed by a six-to-three decision, …

Statutes-Approval Of Public Works Projects Under Nira

Michigan Law Review

Acting under approval and order of the Federal Emergency Public Works Administrator, the United States commenced construction of the Parker Dam across the Colorado River over the objection of the state of Arizona, which was not a party to the Colorado River Compact. Arizona interfered forcibly. A bill was brought by the United States to secure a perpetual injunction against such interference. In response to an argument by Arizona that the dam was not properly authorized, the United States attempted to justify under a recommendation of the chief of engineers as sufficient authorization under section 202 of the National Industrial …

Administrative Tribunals - Distinction In Legal Effect Between Legislative And Quasi-Judicial Orders Of The Interstate Commerce Commission

Michigan Law Review

The legal effect of orders of the Interstate Commerce Commission involves questions upon which there has been much dictum and considerable confusion of the issues. The result has been a body of law which, if not carefully explored, may prove to be a trap for the unwary. In the past few years, however, it is apparent that the courts are making more definite pronouncements which are more clearly pointing the way to distinguishing the various possible issues. The confusion unquestionably results from the heterogeneous nature of the functions performed by the Commission. A typical example is the rate-making function. It …

The Banking Act Of 1935, Harold James Kress

Michigan Law Review

The purpose of this article is to consider in a non-technical manner the principal changes in federal central and commercial banking law which have been brought about by the enactment of the Banking Act of 1935, and in that connection to take some account of the preexisting law and the announced or ostensible reasons for the changes made.

Public Utilities -- Rate-Base -- Late Supreme Court Decisions

Michigan Law Review

In fixing the rate-base of a telephone company, the Maryland Public Service Commission translated the agreed 1923 rate-base (with all subsequent additions to plant) to 1933 price levels by means of a composite price index which included both general all-commodity indices, and indices particularly adapted to the telephone business. Held, that an order enjoining enforcement of the rates will be affirmed. West v. Chesapeake & Potomac Telephone Co., (U.S. 1935) 55 S. Ct. 894.

Administrative Law - Liability Of Public Officers Exercising Quasi-Judicial Functions

Michigan Law Review

Defendants as duly authorized municipal officers issued a building permit to the plaintiff. After plaintiff had acted in reliance thereon defendants for reasons of self-interest and political expediency revoked the permit. Held, defendants as quasi-judicial officers while acting within their jurisdiction are not liable personally in tort for damages resulting from a discretionary act notwithstanding their conduct may have been malicious or corrupt. Wasserman v. City of Kenosha, (Wis. 1935) 258 N. W. 857.

Constitutional Law -The Railroad Retirement Act - Interstate Commerce - Due Process

Michigan Law Review

Serious obstacles were placed in the path of social legislation by the Supreme Court's decision holding the Railroad Retirement Act unconstitutional.1 To what extent the narrow view taken of the permissible field of regulation of interstate commerce will interfere with other legislation based on the commerce power remains to be seen. The majority of the Court, speaking through Mr. Justice Roberts, found the Act objectionable both as violating the due process clause of the Fifth Amendment of the Constitution and as not being a regulation of commerce under the commerce clause. Before taking up these two aspects of the case, …

Constitutional Law - Price Fixing - Limits Of Administrative Discretion

Michigan Law Review

An order of the New York Milk Control Board prescribed a minimum selling price to be charged by wholesale dealers to their customers and also a minimum buying price to be paid by the dealers to producers. Competition fixed the minimum selling price as the maximum obtainable. Plaintiff, a wholesale dealer, could not operate at a profit and sued to enjoin enforcement of the order as arbitrary and hence violative of due process. Held, that upon these facts only, with nothing to show that efficient dealers could not operate profitably, the price limits were not arbitrary. Hegeman Farms Corp. …

The Delegation Of Federal Legislative Power To Executive Officials, Theodore W. Cousens

Michigan Law Review

It will be the purpose of this article to attempt (1) a chronological survey of the previous Supreme Court cases relating to alleged delegations of legislative power, and (2) an analysis and discussion of the Panama Refining Co. decision in the light of this background. No discrimination is made between delegations of state and of federal legislative power, as the Supreme Court makes no such discrimination.

Creation Of Government Corporations By The National Government, Maurice S. Culp

Michigan Law Review

The federal government has until recently made very little use of the corporation as an agency for executing the laws of Congress. Early in the course of our national development the federal government chartered banks and shared in their ownership, utilizing them in the fiscal operations of the treasury. At various other times the federal government has chartered other corporations under some power granted by the Constitution, particularly railroad corporations under the commerce power. Beginning with the World War the corporate form of administrative agency was utilized to avoid difficulties which would arise if the execution of the war-time activities …

Constitutional Law -Validity Of State Recovery Acts Adopting Federal Codes, Paul G. Kauper

Michigan Law Review

Among the interesting problems raised by the enactment of state recovery legislation is the problem growing out of the attempted adoption by the states of the codes of fair competition formulated under the authority of the National Industrial Recovery Act. The validity of such state legislation may be questioned in light of the familiar doctrine of non-delegability of legislative power - a doctrine that has been written into the constitutions of both the federal and state governments by judicial determination. Before considering the application of this doctrine to the problem at hand, it will be well to refer to two …

Cooperation Between The Interstate Commerce Commission And The State Commissions In Railroad Regulation, Martin L. Lindahl

Michigan Law Review

Cooperation between the Interstate Commerce Commission and the state commissions in railroad regulation has been developed to increase the effectiveness of public control under our dual regulatory system. The division of power between federal and state governments, based upon the traditional distinction between interstate and intrastate commerce, has led to a multitude of diverse and conflicting statutes and administrative orders applicable to the same set of transportation agencies. In large measure the problem of dual control has been solved by giving to the federal government a virtually complete occupancy of the fields of rate, finance, and service regulation of interstate …

Penalties As Affected By Good Faith Litigation, Robert E. Hardwicke

Michigan Law Review

There are many state laws, as well as the so-called National Emergency Acts and other federal laws, providing for the imposition of penalties for the violation of a statute, or an order or regulation of a board, commission, or executive officer. Under, the National Industrial Recovery Act, sec. 3 (f), penalties are fixed for the violation of codes promulgated thereunder. In many instances the penalties are cumulative, each day's violation being a separate offense.

The primary question here to be discussed is whether good faith litigation as to the validity of such a law, code, order or similar regulation gives …

Administrative Law-Judicial Review-Federal Equity "Powers

Michigan Law Review

Plaintiff's testator, a resident of New York, died there and at the time of his death owned certain oil paintings on temporary loan to an Art Museum in Pennsylvania, on which the State of Pennsylvania levied an inheritance tax. Plaintiff, executor under a will disposing of the pictures, filed a bill in the Federal District Court for Eastern Pennsylvania to enjoin the defendants, tax officials of Pennsylvania, from attempting to impose or collect the inheritance tax. The bill alleged diversity of citizenship and the requisite jurisdictional amount, and further that the imposition of the tax violated the Fourteenth Amendment, depriving …

Administrative Law - Statutory Interpretation - Conclusiveness Of Decision

Michigan Law Review

Pursuant to an order of the Interstate Commerce Commission, the government had paid defendant $487,116.31 as the deficit incurred during federal control and due defendant under section 204 of the Transportation Act of 1920. The Commission later reopened the proceeding and annulled the order because it had erroneously interpreted the word "deficit" in the statute to mean a decrease in net railroad operating income in the federal control period as compared with the corresponding months of the test period from July 1, 1914, to June 30, 1917, instead of a "red ink deficit." The government then sued to recover the …

Federal Trade Commission-Recent Trends In Interpretation Of The Federal Trade Commission Act

Michigan Law Review

The Federal Trade Commission has never been a favored child of the courts. Beginning with the first case to which the Commission was a party, the attitude of the judiciary has clearly been unfriendly. The Commission gets its powers from the Clayton Act and from the Federal Trade Commission Act. The courts have interpreted the Clayton Act strictly, and there is no sign of a change of heart by the majority of the Supreme Court in that respect; it is believed, however, that a few of the recent cases under the Federal Trade Commission Act, both in the Supreme Court …

Administrative Tribunals-Notice And Hearing

Michigan Law Review

The State Highway Commissioner proceeded against the defendant railroad under a Virginia statute empowering him to order the removal of any railroad grade crossing and the substitution of an elevated road when in his opinion public safety and convenience demanded it. No notice and hearing was given or required, and the only judicial recourse was an action in equity in the event of "arbitrary" action. Held, by a six-three decision, that although it is assumed that a state legislature might order the same action, it by no means follows that an administrative officer may be empowered to act with …

Public Utilities-Rate Base-Allowance For Depreciation

Michigan Law Review

Plaintiff toll bridge company appealed from an order of the Pennsylvania Public Service Commission which set a value for rate-making purposes on their bridge property, constructed in 1924-25, identical to the original valuation order of 1926, for the rate-base as of February 2, 1932. The order allowed a depreciation deduction annually which, with 4 per cent simple interest, would amount to enough to replace the bridge at the end of its estimated period of usefulness. The company claimed the order was confiscatory, as based solely on original cost, without taking into account current cost of reproduction; and that interest should …

Organized Labor And The Recovery Act, Emmett B. Mcnatt

Michigan Law Review

The enactment of the National Industrial Recovery Act last June inevitably has brought to the fore a number of questions which as yet remain unanswered, including those connected with the application and interpretation of Section 7(a) of the Recovery Act, the subject of this article. Under this section, hailed by labor as a "new Magna Charta," employees are apparently given two interrelated rights - the right to organize with no discrimination against them by employers as a result thereof, and the right to collective bargaining through representatives of their own choosing. Employers are prohibited from interfering with such rights through …

Federal Anti-Trust Law And The National Industrial Recovery Act, Howard E. Wahrenbrock

Michigan Law Review

The economic struggle for existence - the competitive system - which has been principally depended upon to equate the production and consumption of economic goods, is not self-sustaining. Extreme forms of that struggle - engrossing, forestalling, regrating, contracts in restraint of trade, monopoly, unfair competition, to mention some forms at the higher stages of legal development - have had to be restrained by law. Their restriction has been called for to protect the poor and economically weak from oppression by the rich and economically powerful; under a system of complete laissez faire, competition would bring about the elimination of the …

Public Utility Valuation - Rate Base

Michigan Law Review

The California Railroad Commission, in conducting a hearing in 1930 on natural gas rates charged by the Los Angeles Gas and Electric Corporation, found that the "historical value" of the utility was $60,704,000, and that its "fair value" for rate-making purposes was $65,000,000. This fair. value figure included no specific allowance for going concern value. The company's engineers had estimated the fair value at $95,000,000, on the basis of the "present cost of reproduction" theory. The commission, relying on its fair value figure of $65,000,000, ordered a rate reduction. A three-judge federal court refused to enjoin the enforcement of the …

The Emergency Railroad Transportation Act, 1933, Edwin C. Goddard

Michigan Law Review

From Munn v. Illinois to the Emergency Railroad Transportation Act of 1933 has been a long journey traveled by the public and the public utilities, notably the largest public utility, the railroads. In 1876 the very term "public utility" was unknown. The idea that the public could break in on laissez faire and regulate any business was to the persons regulated, and to their lawyers, odious. With them agreed Justices Field, Brewer, Peckham, and many another, who predicted that the public would not long tolerate such interference with business. But prophecy is hazardous, and these prophets were wrong.

Railroads - Power Of Interstate Commerce Commission To Order Extensions

Michigan Law Review

After due hearing upon a complaint filed by the Public Service Commission of Oregon asserting a failure to provide adequate transportation facilities to a large and unexploited area within that State, the Interstate Commerce Commission found that public necessity and convenience required the construction of a connecting line 185 miles in length. The Commission also found that the proposed extension, adding 1.2 per cent to the existing mileage of the Union Pacific system and costing approximately $10,000,000, would not seriously affect the ability of that organization adequately to serve the public; and that though the venture might not be profitable …

Burden Of Proof In Rate Cases Involving Inter-Corporate Charges, William E. Treadway

Michigan Law Review

The United States Supreme Court has held repeatedly that dealings between intercorporately related companies should be scrutinized closely to prevent any unfair advantage being taken of a subsidiary public utility company by a dominant organization through an exercise of the control inherent in capital stock ownership.1 Yet in an opinion written by Mr. Justice McReynolds in 1923, the court laid down a rule for utilities commissions in rate cases involving intercorporate service-contract charges which, if strictly adhered to, would have sounded the death knell for effective commission regulation.