Federal Maritime Commission v. Anglo-Canadian Shipping Company, Ltd.

335 F.2d 255, 1964 U.S. App. LEXIS 4622, 1964 A.M.C. 1885
CourtCourt of Appeals for the Ninth Circuit
DecidedJuly 27, 1964
Docket19085_1
StatusPublished
Cited by30 cases

This text of 335 F.2d 255 (Federal Maritime Commission v. Anglo-Canadian Shipping Company, Ltd.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Federal Maritime Commission v. Anglo-Canadian Shipping Company, Ltd., 335 F.2d 255, 1964 U.S. App. LEXIS 4622, 1964 A.M.C. 1885 (9th Cir. 1964).

Opinions

HAMLEY, Circuit Judge.

The Federal Maritime Commission commenced this action in the district court for enforcement of an administrative order. The order directed twenty-three named common carriers to produce certain papers and communications for inspection and copying by Transmarine Contract Carriers, Inc., in connection with a complaint proceeding pending before the Commission. The district court set aside the Commission’s order on the ground that it was issued pursuant to an invalid regulation, and dismissed the petition for enforcement. The Commission appeals.

The sole question presented for our consideration is whether the Commission had authority to promulgate its Rule of Practice 12 (k), 46 C.F.R. § 201.211 (Supp.1963), entitled “Discovery and Production of Documents.”

[257]*257The background facts are not in dispute. Pursuant to section 22 of the Shipping Act, 39 Stat. 736 as amended 46 U.S.C. § 821 (1958), Transmarine Contract Carriers, Inc., filed with the Commission a complaint against twenty-three common carriers comprising the Pacific Coast European Conference.1 The complaint set forth that Trans-marine had been engaged in contract carriage of certain commodities between ports on the Pacific coast and European ports. It was further alleged that the named common carriers had combined among themselves and with others to disrupt the contract relationship between Transmarine and the Weyerhaeuser Company, had succeeded in terminating Transmarine’s contract to carry wood pulp for Weyerhaeuser, and had driven Transmarine out of the Pacific coast European trade. These activities were alleged to be violations of sections 14 (Third), 15 and 16 (First), of the Shipping Act, 46 U.S.C. §§ 812 (Third), 814 and 815 (First) (1958).

Transmarine sought an investigation and hearing, a declaration that the common carriers had violated the cited sections of the Act, and other appropriate relief. Shortly after filing its complaint, Transmarine moved the Commission for discovery and production of documents. Specifically, the company requested that the twenty-three common carriers be ordered to make available copies of certain communications between the Conference or its members and six named parties including the Commission, and between the Conference and its individual members.

The documents requested related to Transmarine, certain rates of carriage, and Weyerhaeuser Company and Allied Canners and Packers, Inc. The copies were to be made at Transmarine’s expense. The motion set forth that the papers sought, in Transmarine’s belief, would prove the alleged violations and were in the possession of the common carriers. The motion was made pursuant to the Commission’s Rule of Practice 12 (k) authorizing hearing examiners, on a showing of relevance and good cause, and upon notice to all parties, to order the production for copying of documents in a party’s possession.2

The common carriers against which the motions were directed moved to strike the motion for discovery on the ground that there is no express or implied authority for the promulgation of a prehearing discovery rule such as Rule 12 (k), and therefore the rule is, and any order issued thereunder would be, invalid. The hearing examiner denied the motion to strike and gave the common carriers additional time within which to file specific objections to the scope of the motion. The common carriers filed no such objections and the hearing examiner thereupon granted the motion for discovery.

Specifically, the common carriers were ordered to produce and make available for inspection and copying the requested documents by a named date, the time and place of production to be mutually agreed upon by the parties. Provision was made in this order for the common carriers to resist the disclosure of any [258]*258confidential information concerning the affairs of shippers or consignees, pursuant to section 20 of the Shipping Act, 46 U.S.C. § 819 (1958). Such disputed items were first to be submitted to the hearing examiner for a determination regarding disclosure.

The common carriers thereafter informed Transmarine and the hearing examiner of their intention not to comply with the discovery order. Their position and the order in question were then referred to the Commission. The Commission approved the order and determined to seek its enforcement in the district court. This action for enforcement of the discovery order was then commenced pursuant to section 29 of the Shipping Act, 46 U.S.C. § 828 (1958).

In its petition to the district court the Commission asked that the common carriers be ordered to produce all unprivileged papers specified in the motion for discovery. The common carriers, respondents in the district court proceeding, resisted the petition for enforcement on the same grounds they had advanced before the hearing examiner. In setting aside the Commission order and dismissing the petition the district court expressed the view that the Commission’s discovery rule “ * * * does more than to merely fill in details within the framework of existing legislation. It adds thereto, and hence is without authority in law.” This appeal followed.

As indicated by the quoted observations of the district court, Rule 12 (k) was not held to be invalid on the ground that it is an inappropriate means of accomplishing a legitimate objective, or because of any defect in the rule-making proceeding which led to its promulgation. It was held to be invalid on the ground that the Commission was without authority to promulgate any rule relating to the discovery and production of documents.

In considering whether this ground for invalidating the rule is well founded, we start with the proposition, not contested here, that the regulations of an agency of the United States must be issued within the powers conferred by Congress. Kirk v. United States, 9 Cir., 270 F.2d 110, 118. If agency regulations go beyond what Congress has authorized, they are void. Utah Power & Light Co. v. United States, 243 U.S. 389, 410, 37 S.Ct. 387, 391, 61 L.Ed. 791; Hawke v. Com’r of Int. Rev., 9 Cir., 109 F.2d 946, 949.

Rule 12 (k) was promulgated on March 26,1958, by the Federal Maritime Board, the predecessor of the Commission. As the Commission concedes, there was not then in effect, nor has there since been enacted, any statute explicitly empowering the Board or Commission to promulgate a rule relating to the discovery and production of documents. But there was then in effect section 204(b) of the Merchant Marine Act of 1936, 49 Stat. 1987 as amended 46 U.S.C. § 1114(b) (1958), providing as follows:

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Bluebook (online)
335 F.2d 255, 1964 U.S. App. LEXIS 4622, 1964 A.M.C. 1885, Counsel Stack Legal Research, https://law.counselstack.com/opinion/federal-maritime-commission-v-anglo-canadian-shipping-company-ltd-ca9-1964.