Columbia Law Review Association, Inc. Columbia Law Review

The Supreme Court and Administrative Law
Author(s): Reuben Oppenheimer

Source: Columbia Law Review, Vol. 37, No. 1 (Jan., 1937), pp. 1-42
Published by: Columbia Law Review Association, Inc.
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COLUMBIA LAW REVIEW
VOL. XXXVII JANUARY, 1937 NO. 1
THE SUPREME COURT AND ADMINISTRATIVE

LAW
The nine Justices of the Supreme Court are in agreement upon

the importance and necessity of a form of governmental institution to
which no reference is made in the Constitution. The Court sharply
divides upon questions as to what constitutes interstate commerce, due
process of law, and the division of power between the Federal Govern-
ment and the States, but it unites in its recognition of the administrative
tribunal as a vital and permanent part of our system of government.
That recognition may be temporarily obscured by the immediate im-
portance of the specific decisions. It is shaded in majority and minority
opinions, and, like all legal development, it rests upon a gradually ac-
cumulated delta of precedent, so that the Court in portraying the present
speaks largely in terms of the past. The realism shown in perceiving
the necessity of these governmental instrumentalities may be contrasted
with some of the Court's decisions on their functioning. But when
Chief Justice Hughes, speaking for a majority of eight, refers to "the
necessity of adapting legislation to complex conditions involving a host
of details with which the National Legislature cannot deal directly;"'1
when Mr. Justice Sutherland, for a majority of six, speaks of "the
various administrative bureaus and commissions, necessarily called and
being called into existence by the increasing complexities of our modern
business and political affairs ;"2 when seven of the Court's most im-
portant decisions in little more than a year3 deal, in whole or part, with
questions of administrative law, it becomes apparent that a definite point
has been reached in the development of a relatively new branch of our
jurisprudence.
More people, it is believed, are directly affected by the processes of
administrative boards and quasi-judicial tribunals than by adjudications
of the courts. Justice, to the majority of our population, is more apt
Schechter v. United States, 295 U. S. 495, 529, 530 (1935).

2Jones v. Securities and Exchange Commission, 298 U. S. 1 (1936).
'Panama Refining Co. v. Ryan, 293 U. S. 388 (1935); Schechter v. United
States, 295 U. S. 495 (1935) ; Rathbun v. United States, 295 U. S. 602 (1935) ;
Jones v. Securities and Exchange Commission, 298 U. S. 1 (1936) ; St. Joseph
Stock Yards Co. v. United States, 298 U. S. 38 (1936) ; Carter v. Carter Coal Co.,
56 Sup. Ct. 855 (1936); Morgan v. United States. 56 Sup. Ct. 906 (1936).
COLUMBIA LAW REVIEW
to mean the fairness of an old age pension or unemployment insurance

board than the soundness of a judicial pronouncement.4 The carfare
fixed by a public utility commission or the treatment accorded by a
workmen's compensation or old age pension board directly affects the
average man, in his own belief, more than the decisions of the Supreme
Court.5
This transfer of so much of the functioning of legal machinery to
administrative boards is the vital fact of modern jurisprudence.6 In the
same way, imperceptibly, with our change from a rural to an urban
civilization, the vital fact in the history of American law, during the
last few decades, was the administration of justice by petty courts. The
importance of police magistrates, people's courts, juvenile courts and
similar tribunals, as the concrete token of the judicial process in most
lives, was realized only after the transition.7 In the even larger field
of administrative law, the Supreme Court in decision after decision is
calling attention to the fact of the transition now occurring. In this
aspect of its interpretation of the American system, the Supreme Court
is evidencing its realism.
Realism in administrative law may be considered in three aspects.
First, there is the perception of the necessity for the evolution of gov-
ernmental agencies which are dynamic rather than static in operation, to
carry out the process of law efficiently in our complex civilization. A
legislature enacts principles, a court decides cases, a board carries out a
policy, enacting, ordering and deciding as it goes. Second, there must
be a determination of the general form within which these agencies are
to evolve. Certain standards must be established, taking into account on
the one hand the exigencies of government, and, on the other, justice to
the governed. Third, there is the functioning of the particular agencies
within the general frame work, the adaptation of each to its own func-
See Nagel, Federal Departmental Practice, THE GROWTH OF AMERICAN AD-
MINISTRATIVE LAW (1923) 175, 186.
5"The control of banking, insurance, public utilities, finance, industry, the
professions, health and morals, in sum, the manifold response of government to the
forces and needs of modern society, is building up a body of laws not written by
legislatures, and of adjudications not made by courts and not subject to their
revision." Frankfurter, The Task of Administrative Law (1927) 75 U. OF PA. L.
REV. 614.
6 Hughes, Some Aspects of the Development of American Law (1916) 39
N. Y. S. B. A. Rep. 266, 269-270; Mr. Chief Justice Hughes, Address to Federa.
Bar Association, U. S. Daily, Feb. 14, 1931; HEWART, THE NEW DESPOTISaI
(1929); COMMITTEE ON MINISTERS' POWERS REPORT (1932 Cmd. 4060) ; Suther-
land, Private Rights and Government Control (1917) 42 A. B. A. Rep. 197, 204;
Root, Public Service by the Bar, ADDRESSES ON GOVERNMENT AND CITIZENSHIP
(1916) 519, 534-535; Pound, The Administrative Application of Legal Standards
(1919) 44 A.B. A. Rep. 445; Stone, The Common Law in the United States
(1936) 50 HARV. L. REV. 4, 16 et. seq.
'R. H. SMITH, JUSTICE AND THE POOR (1919) c. 1; Pound, The Administra-
tionz of Justice in the Modern City (1913) 26 HARV. L. REV. 302, 316.
ADMINISTRATIVE LAW 3
tion, its own success or failure in carrying out the governmental func-
tion entrusted to it and in doing justice in the specific case.
But this approach in itself is theoretical, unless it takes into ac-
count the way in which our American system of law operates upon
administration. Our boards and commissions are a curious growth. For
the most part, they are called into being by a legislature,8 but they may
be created by a department,9 and analogous tribunals may be developed
by a court.'0 Their general form is fixed partly by judicial determina-
tion, partly by Congressional or State enactment, and partly by internal
development. Their activities may be entirely reviewable by the courts,"
or may be largely non-reviewable.12 We have not, nor are we likely
to have anything comparable to the ordered, logical, Continental system
of a droit admninistratif.'3 Court review of administrative bodies is
8E.g., public utility commissions, workmen's compensation boards, the Fed

Trade Commission.
'E.g., the board of review in the Department of Labor, a nonstatutory body
acting as an administrative court to review alien deportation proceedings. See
CLARK, DEPORTATION OF ALIENS (1931) 377-388; VAN VLEcK, THE ADMINISTRA-
TIVE CONTROL OF ALIENS (1932) ; and NATIONAL COMMISSION ON LAW OBSERVANCE
AND ENFORCEMENT, REPORT ON THE ENFORCEMENT OF THE DEPORTATION LAWS OF
THE UNITED STATES (1931).
'E.g., the development by the courts of a new administrative procedure in
juvenile court and domestic relations cases. See FLEXNER AND OPPENHEIMER,
THE LEGAL ASPECT OF THE JUkVENILE COURT (U. S. Children's Bureau, 1922) 21;
FLEXNER, OPPENHEIMER AND LENROOT, THE CHILD, THE FAMILY, AND THE COURT
(U. S. Children's Bureau, 1929) 18-22.
" The order of an administrative tribunal may be set aside for any error of law,
substantial or procedural. Interstate Commerce Comm. v. Union P. R. Co., 222
U. S. 541 (1912). Where a constitutional issue is involved, it has been held
that the court must independently determine the correctness of the findings of facts
of the administrative body. Ohio Valley Water Co. v. Ben Avon Borough, 253
U. S. 287 (1920); Manufacturers R. Co. v. United States, 246 U. S. 457, 488-490
(1918); St. Joseph Stock Yards Co. v. United States, 298 U. S. 38 (1936). But
see concurring opinion of Mr. Justice Brandeis in St. Joseph Stock Yards Co. v.
United States, spra at 73.
1 E.g., cases involving the action of the Post Office Department. Public
Clearing House v. Coyne, 194 U. S. 497 (1904) * United States ex rel Milwaukee
Publishing Co. v. Burleson, 255 U. S. 407 (1921). Cf. School of Magnetic Healing
v. McAnnulty, 187 U. S. 94 (1902) and Leach v. Carlile, 258 U. S. 138 (1922).
See Masses Publishing Co. v. Patten, 244 Fed. 535 (S. D. N. Y. 1917), rev'd, 246
Fed. 24 (1917), and discussion thereof in CHAFEE, FREEDOM OF SPEECH (1920) 46-56.
See also dissentineg opinions of Mr. Justice Brandeis and Justice Holmes, U. S.
ex rel. Milwaukee Publishing Co. v. Burleson, 255 U. S. 407, 417, 436 (1921).
In cases, involving the deportation of aliens under warrants of the Secre-
tary of Labor, the Department's findings of fact are not disturbed, if there is some
evidence to sustain them. Kwock Jan Fat v. White, 253 U. S. 454 (1920) ; Tisi v.
Tod, 264 U. S. 131 (1924); Zakonaite v. Wolf, 226 U. S. 272 (1912) * Costanzo v.
Tillinghast, 287 U. S. 341 (1932). See VAN VLECK, THE ADMINISTRATIVE CON-
TROL OF ALIENS (1932) c. 5.
For an analysis of Supreme Court cases reviewing determinations made in the
administration of the business of government, see DICKINSON, ADMINISTRAT'IVE
JUSTTCE AND THE SUPREMACY OF LAWV IN THE UNITED STATES (1927) c. 10.
13 THE REPORT OF THE COMMITTEE ON MINISTERS' POWERS (1932 Cmd. 4060)
118, unanimously concluded that a "system of administrative law and administrative
judges (i.e., analogous to the French system) should not be established."
4 COLUMBIA LAW REVIEW
often oblique. A Federal board is created by act of Congress. The

first question is whether Congress had constitutional power to legislate
in the particular field. If it did, has it constitutionally delegated its
powers? Have the boundaries between legislative, executive and judicial
domains been violated? If not, is there due process of law in the way
the board operates? If these bridges have been crossed, in what way
does the administrative action come before the court? Are the findings
presumptively correct, or are they conclusive, or is there to be a review
de novo? Enmeshed in the consideration of these questions are sub-
sidiary but important questions of proper choice of legal remedy. The
questions primarily before the court are generally ones of constitutional
law rather than of functional review.14
The legal sieve through which administrative bodies pass in these
various ways may destroy them, may alter their character, or they may
pass through virtually unscathed. Survival does not necessarily mean
approval of their functioning in relation to their purpose. Illegality
does not necessarily mean condemnation of their objectives or even of
their method of operation. A finding of due process in their operation
does not necessarily connote either fairness or efficiency in actual work-
ing.'5
For these reasons, probably the best definition of administrative
law is that "it deals with the field of legal control exercised by law-ad-
ministering agencies other than courts, and the field of control exercised
by courts over such agencies."16
II
The historical background in matters of administrative law is, in

itself, evidence of a pragmatic Anglo-American approach to questions
of government. It must be remembered that the importance of historical
precedent in such an inquiry can easily be overstated or understated.
It becomes largely a matter of the individual view of social expediency
whether emphasis is laid upon the modernity of the Statute of Sewers,17
or upon the tyranny of the Star Chamber. Certain generalizations,
however, may be hazarded. Both in England and America, constitu-
tional means have been found to forge the governmental instrument of
administrative boards at any time when it was found necessary. Yet the
See Gellhorn, Book Review (1936) 36 COLUMBIA LAw REV. 859, 860.
laOwnbey v. Morgan, 256 U. S. 94 (1921).
"6Frankfurter, Book Review (1924) 37 HARV. L. REV. 638, 640. Ernst Freund
defines administrative law, to the same effect, as "the law of official power and
of its subjection to judicial control." 1 ENCYCLOPEDIA OF THE SOCIAL SCIENCES
452. For a collection and criticism of the definitions of Austin, Holland and
others, see PORT, ADMINISTRATIVE LAW (1929) c. 1.
1723 HENRY VIII, c. 5 (1531).
sweeping and blended authority found in modern administrative bodies,

such as the Interstate Commerce Commission, finds no direct support in
the American Constitution and probably was not anticipated by the
f ramers.
In the Sixteenth Century, the English Statute of Sewers'8 delegated
to the Commissioners of Sewers legislative powers, powers to impose
rates upon landowners, and to fix and collect penalties for non-payment.
Judicial powers were early given to Commissioners over the customs
and excise.19 Broad powers were granted to Commissioners for stamp
duties.20 The principal point of contact of the English people with
legal process in the Seventeenth Century was the Justice of the Peace,
who combined legislative, administrative and judicial functions.21
In Colonial America, at the time of the formation of the United
States, while governmental problems had not attained the complexity
they had reached in England, local blending of judicial, administrative
and executive functions was an accepted fact. Thomas Jefferson pointed
to the Virginia County courts, which, like others of the time, levied
taxes and voted expenditures, as "in truth our principal executive and
judiciary."22 At this point, however, the thread of historical continuity
grows thin, if it does not break. The American statesmen of the late
eighteenth century were apprehensive of and even opposed to a blending
of the three government functions beyond the agencies of local county
government.
Jefferson, who acknowledged the value of the functional diversi-
fication of the county courts,23 felt quite differently even as to the Vir-
ginia Legislature. The Virginia Constitution, in much the same lan-
guage as the Constitutions of others of the original states, declares "that
the legislative, executive and judicial departments shall be separate and
distinct . . . nor shall any person exercise the power of more than one
18 See supra note 17.

19 12 CHARLES II, c. 24, ? 45 (1661); 1 GEO. II, St. 2, c. 16, ?? 4, 5 (1727).
a 25 GEO. III, c. 51, ?? 5, 51 (1785). These and other early instances of
powers delegated in England to administrative bodies are collected in REPORT OF
COMMITTEE ON MINISTERS' POWERS (1932 Cmd. 4060) 8 et seq. The Report
points out (at 15) that most of the instances given come from the Tudor period,
when, like the present era, "great political, social and economic changes were
taking place." Other English historical precedents are given by DICKINSON, AD-
M\INISTRATIVE JUSTICE AND THE SUPREMACY OF LAW (1927) 5, n. 5; RoBsON,
JUSTICE AND ADMINISTRATIVE LAW (1928) c. 1.
2SIDNEY AND BEATRICE WEBB, ENGLISH LOCAL GOVERNMENT-THE PARISH
AND THE COUNTY (1906) 419; ENGLISH LOCAL GOVERNMENT-STATUTORY Au-
THORITIES (1922) 352.
22 Letter to John Taylor, July 16, 1816, 15 THE WRITINGS OF THOMAS JEFFER-
SON (Memorial Ed. 1903) 44. For other examples of colonial combination of execu-
tive and judicial duties in the hands of justices of the peace and county courts, see
DICKINSON, op. cit. sutpra note 20, at 33 n. 5.
3 See letter cited suipra note 22.
of them at the same time."24 Jefferson, himself, reaffirmed the prin-

ciple of separation of powers, and, while conceding that no opposition
was likely or could be effectual to legislative encroachment on the exec-
utive and judiciary, deplored legislative decision of judicial questions
and the direction in practice of the legislators by the executive.25
In the Constitutional Convention of 1787, Madison proposed that
there should be an express limitation upon the powers of the executive
to execute such other powers "not Legislative nor Judiciary in their
nature" as might from time to time be delegated by the National Legis-
lature.26 He thought that the doctrine of limitation of powers should
not be confined to theory in the Constitution, but that a defensive power
should be given to each department to maintain the theory in practice.27
A proposal to unite the judiciary with the executive in revising the
laws, although urged by Madison, James Wilson and Gouverneur
Morris, was several times defeated.28 The structure of the Constitution
emphasizes the separation of powers between three departments.29 One
of the most important numbers in the Federalist30 agrees that were the
Constitution chargeable "with a mixture of powers, having a dangerous
tendency" to an accumulation of legislative, executive and judiciary
powers in the same hands, whether of one, a few or many, "no further
arguments would be necessary to inspire a universal reprobation of
the system."
It is true that, in England, the struggle for liberty had been against
the power of a hereditary monarch, and that, in America, the source
of sovereignty was transferred, indirectly, to the people. There is, how-
ever, ample evidence that the framers of the Constitution had vividly
before them the dangers in unchecked legisla'tive powers.31 James
Madison stated that "experience in all the States had evinced a power-
ful tendency in the Legislature to absorb all powers into its vortex. This
was the real source of danger to the American Constitutions."32 Gouv-
erneur Morris concurred "in thinking the public liberty in greater danger
24 Art. III, ? 39; see THE FEDERALIST (1818) No. XLVIII.

25 Notes on the State of Virginia, 2 THE WRITINGS OF THOMAS JEFFERSON
(Memorial Ed. 1903) 162 et seq.
26Debates in the Federal Conventton of 1787, as reported by James Madison
DOCUMENTS ILLUSTRATIVE OF THE FORMATION OF THE UNION OF THE AMERICAN
STATES (House Document No. 398, 1927) 133, 134.
27 DOCUMENTS ILLUSTRATIVE OF THE FORMATION OF THE UNION OF THE
AMERICAN STATEs, supra note 26, at 426.
28Id. at 429, 548, 756, 849 (Notes James Madison, Robert Yates and Rufus
King).
"Art. I, ? 1; Art. II, ? 1; Art. III, ? 1.
30 No. XLVII. See also Nos. XLVIII and XLIX.
" Cf. STORY, COMMENTARIES ON THE CONSTITUTION (4th ed. i) 385.
32 Documents, supra note 26, at 424. See also THE FEDERALIST (1818) No.
XLIX.
from Legislative usurpations than from any other source."33 James

Wilson asked: "Is there no danger of a Legislative despotism? Theory
and practice both proclaim it."34
It is also true that the framers of the Constitution, for the most
part, considered the doctrine of the separation of powers from the point
of view of one department checking and balancing the others. But when
this checking and balancing principle impinged upon the doctrine of
separation of powers in the proposal to give the judiciary joint revision-
ary powers with the executive, the latter principle prevailed. This is all
the more significant because the framers were entirely familiar with
the fact that, in England, members of the Judiciary sat in the Privy
Council and the House of Lords. If modern doctrines of administrative
law depended upon the continuity of English and American historical
precedent, there is here a sharp and deliberate break with the English
tradition.
Nor were the founding fathers really misled by the misappre-
hensions of Montesquieu35 on this point. That criticism has been more
directed against recent English writers.36 The leaders of American
thought and statesmenship were conversant, both in theory and practice,
with English institutions, and could analyze correctly the real signifi-
cance of Montesquicu's generalizations.37
In short, it is submitted that there is no reason to suppose that the
existence of our modern administrative bodies, with their diversified
authority, is in line with the philosophy of the framers of our Consti-
tution at the time of its writing. The conditions of modern life, with
the close interrelation between all parts of the country and all elements
in the economic structure, are so different from those of Colonial
America, where the emphasis of life was still upon the individual and
local unit, that with all their perspicacity, the framers could hardly have
imagined this aspect of the future. There are strong indications that, as
a matter of theory, the doctrines of modern administrative boards would
have been repugnant to the men who wrote the Constitution. Could they
have been faced with the facts of present-day conditions, there is a
3' DOCUMENTS, supra note 26, at 425.

3Id. at 212.
3 9 MONTESQUIEU, DE L'ESPRIT DES Lois (Eng. ed. 1751) c. VI.
M DicEy, THE LAW OF THE CONSTITUTION (8th ed. 1915). HEWART, THE NEW
DESPOTISM. Cf. Dicey, The Development of Administrative Law in England (1915)
31 LAW QUARTERLY REVIEW 148; ROBSON, JUSTICE AND ADMINISTRATIVE LAW; RE-
PORT OF COMMlTTEE ON MINISTERS' POWERS (1932 Cmd. 4060) ; Jennings, Courts
and Administrative Law (1936) 49 HARV. L. REv. 426, 430.
37 "His meaning . . . can amount to no more than this, that where the whole
power of one department is exercised by the same hands which possess the whole
power of another department, the fundamental principles of a free constitution are
subverted." THE FEDERALIST (1818) No. XLVII.
strong possibility that their decision might have been otherwise; the
founding fathers were practical men. But those who argue that con-
stitutional construction depends upon what is written within the four
corners of the instrument, interpreted by the then current political phi-
losophy, must reconcile the undisputed and established constitutionality
of such bodies as the Federal Trade and Interstate Commerce Commis-
sions.
The powers given to the three departments under the Constitution
were not long kept in separate bins. By the Act of June 4, 1794,38 the
President, under stated conditions, was authorized to lay an embargo
whenever he found "that the public safety shall so require." The fol-
lowing year, in certain cases, the President was authorized by Congress
to permit the exportation of arms and articles of commerce.39 In 1798,
he was permitted, under certain circumstances, by proclamation, to dis-
continue the suspension of commercial intercourse between France and
the United States.40 Similar authority was given in the succeeding years
to remit and discontinue restraints and prohibitions imposed by Congress
upon trade with certain countries, and to permit or interdict the entrance
into our waters of armed vessels belonging to foreign nations.41 These
Acts were not the subject of judicial decision. "They afford no adequate
basis for a conclusion that the Congress assumed that it possessed an
unqualified power of delegation."42 In The Aurora, however, it was, in
effect, decided that it was competent for Congress to make the revival
of such an act dependent upon the proclamation of the President.43
Wayman v. Southard44 merely decided that the statutes of Ken-
tucky concerning executions were not applicable to executions on judg-
ments of the Courts of the United States. However, Chief Justice
Marshall considered the question of delegation of powers by Congress to
the Courts, and said:
"The line has not been exactly drawn which separates those important
subjects, which must be entirely regulated by the legislature itself, from those
of less interest, in which a general provision may be made, and power given to
those who are to act under such general provisions to fill up the details."45
1 STAT. 372 (1794).

31 STAT. 444 (1795).
41 STAT. 565, 566 (1798).
4' 1 STAT. 613, 615 (1799); 2 STAT. 7, 9, 10 (1800); 2 STAT. 339, 341, 342 (1895)
2 STAT. 351, 352 (1806); 2 STAT. 490 (1808). See Marshall Field v. Clark, 143
U. S. 649, 684 (1892); Panama Refining Co. v. Ryan, 293 U. S. 388, 422 (1935).
4 Panama Refining Co. v. Ryan, 293 U. S. 388, 422 (1935).
437 Cranch 382 (1813). See Marshall Field v. Clark, 143 U. S. 649, 683
(1892); Panama Refining Co. v. Ryan, 293 U. S. 388, 424 (1935).
"10 Wheat. 1 (U. S. 1825).
4Id. at 43.
Marshall's dictum in Wayman v. Southard marked a considerable

step in the development of administrative law from the practice of the
early statutes and the decision in The Aurora. In the Acts at the end
of the eighteenth century, Congress had merely given another depart-
ment, the executive, the right to suspend or reinstate legislation upon
the happening of certain specific events. Marshall's doctrine of filling
up the details goes far beyond this; it recognizes a dynamic power of
action, legislative in nature, although on a subordinate plane of im-
portance, in a department not expressly given legislative power.
The pragmatic nature of that doctrine was elaborated by the Court
in Butttfield v. Straahan.46 In that case, a statute was upheld which
authorized the Secretary of the Treasury, upon the recommendation of
a board of experts, to establish uniform standards of purity, quality and
fitness for teas imported into the United States, and to exclude inferior
grades. The Court said: "Congress legislated on the subject as far as
was reasonably practicable, and from the necessities of the case was
compelled to leave to executive officials the duty of bringing about the
result pointed out by the statute."47 The Treasury officials, it is to be
noted, were to be guided by experts. Modern legislators, if they are to
carry on the functions of democracy, cannot become tea tasters. De-
mocracy in time of revolution can throw tea overboard by mass action,
but it requires individual training and experience to determine what tea
should be brought in.
The necessity of specialized, expert services in administrative boards
and commissions has been recognized by Congress and the Supreme
Court. An administrative body should be "specially competent . .
by reason of information, experience and careful study of the business
and economic conditions of the industry affected" and its organization
should be such as to give its members "opportunity to acquire the expert-
ness in dealing with these special questions concerning industry that
comes from experience."48 It is a sound American instinct that regu-
lation by experts may be overdone,49 but their usefulness in proper fields
of administrative law is today axiomatic.
192 U. S. 470 (1904).

4 Id. at 496. Examples of similar statutes held valid, although delegating
legislative power, are given in Panama Refining Co. v. Ryan, 293 U. S. 388, 425-
429 (1935).
4 Sen. Rep. No. 597, 63d Cong., 2d Sess. (1914) 9, 11, quoted with approval
in Federal Trade Comm. v. Keppel, 291 U. S. 304, 314 (1934).
4 See Schneider v. Duer, 184 Atl. 914, 917 (Md. 1936), holding invalid an act
of the legislature establishing a board of paid officials for the purpose of regulating
the trade of barbering. The Court said (at 917):
"Acts creating boards or commissions, with numerous officials and paid
employees, complicated legal machinery, and elaborate plans for the supposed
purpose of regulating simple trades and callings, well known and understood
There is another essential of the modern commission-the power

to make rules and regulations for administering the laws. The Court
had some difficulty in distinguishing legislative power to make laws from
administrative authority to make regulations, but Marshall's "power to
fill up the details" again proved useful, and it is now settled law that
Congress can constitutionally leave this power to executive officers or
commissions.50
The development of the Interstate Commerce Commission, both
under Congressional enactment and decisions of the Supreme Court, has
been a gradual process. The Act of 188751 was a mere beginning. Not
until the Hepburn Act of 190652 was the Commission given fairly ade-
quate powers of regulation. Difficulties in administrative experience
brought forth the Mann-Elkins Act of 1910,l3 and further development
was crystallized in the Transportation Act of 1920.54 The decisions
of the Supreme Court show a similar cautious progression.55 Yet it
has been well said of the resultant product that it is "the leading govern-
mental agency of economic control in the United States. . . . In the
exercise of this authority moreover there is a marked departure from
traditional legal processes . . . although it is an administrative agency
it continually adjusts controversies and prescribes courses of future
action; despite the exercise of these judicial and legislative functions
it institutes criminal proceedings and penalty suits, and it moves on its
own initiative as well as in response to complaints and applications."56
For the purposes of the present discussion, it is only necessary to allude
by the public, the expenses of which come out of the pockets or earnings of
those engaged in the trade, should be viewed with care and examined with
diligence to ascertain whether such acts and regulatory measures are designed
to safeguard the public welfare, or for other purposes not sanctioned by law
and beyond the limitations prescribed by the letter of the Constitution and by
judicial interpretation."
' Union Bridge Co. v. United States, 204 U. S. 364 (1907); Ex parte Reed,
100 U. S. 13 (1879); Smith v. Whitney, 116 U. S. 167, 181 (1886) ; In re
Kollock, 165 U. S. 526 (1897) ; Buttfield v. Stranahan, 192 U. S. 470 (1904) ;
United States v. Grimaud, 220 U. S. 506 (1911). See FREUND, ADMINISTRATIVE
POWERS OVER PERSONS AND PROPERTY (1928) c. XI.
524 STAT. 379 (1887), 49 U. S. C. ?? 1 et seq. (1934).
534 STAT. 584 (1906), 49 U. S. C. ?? 1, 6, 11, 14, 15, 16, 16a, 18, 20, 41 (1934).
36 STAT. 534 (1910), 49 U. S. C. ?? 1, 4, 6, 10, 13, 15, 16, 20 (1934).
6441 STAT. 474-499 (1920), 49 U. S. C. ?? 1-6, 10-16, 17, 18, 19a, 20a, 25-27
(1934).
5 E.g., Interstate Commerce Comm. v. B. & 0. R. R., 145 U. S. 263 (1892);
Texas & Pacific Ry. v. Interstate Commerce Comm., 162 U. S. 197 (1896) ; Illinois
Cent. Ry. v. Interstate Commerce Comm., 206 U. S. 441 (1907) ; Interstate Com-
merce Comm. v. Goodrich Transit Co., 224 U. S. 194 (1912) ; Interstate Commerce
Comm. v. Louisville & N. Ry., 227 U. S. 88 (1913); Intermountain Rate Cases, 234
U. S. 476 (1914) ; Texas & P. R. R. v. Gulf, C. & S. F. R. R., 270 U. S. 266 (1926) ;
New York Central Securities Corp. v. United States, 287 U. S. 12 (1932) ; United
States v. Baltimore & Ohio R. R., 293 U. S. 454 (1935).
' Sharfman, The Interstate Commerce Commission, 8 ENCYCLOPEDIA OF THE
SOCIAL SCIENCES, 229, 230.
to the valid establishment, in other economic fields, of such adminis-

trative tribunals as the Federal Trade Commission57 and the Federal
Radio Commission.58
No attempt is here being made to enumerate the decisions of the
Supreme Court before the line of cases beginning with Panama Refining
Company v. Ryan, on questions of administrative law involving either
agencies of the Federal Government or of the States. There has been
no discussion, to this point, of the cases which determine the form of
these administrative tribunals, the provision for fair administration by
them and the right and scope of judicial review. The doctrines of the
Supreme Court in these phases of administrative law are crystallized
in its most recent decisions. This brief historical review has touched
only upon the Court's steady recognition and approval of the new
form of governmental institution which the administrative tribunal rep-
resents.
The terminal authority given the President by the early Congresses,
Chief Justice Hughes has pointed out, was due to the exigencies of war
in Europe "when the national safety was imperiled."59 Chief Justice
Marshall, in Wayman v. Southard, emphasized that "Congress, at the
introduction of the present government, was placed in a peculiar situ-
ation."60 Justice Harlan adopted as his own the language of the Pennsyl-
vania Court that "there are many things upon which wise and useful
legislation must depend which cannot be known to the law-making
power, and, must, therefore, be a subject of inquiry and determination
outside of the halls of legislation," and that to deny this "would be to
stop the wheels of government.""' And Justice McKenna stated the
real basis of all these decisions when he said that "if this were not so,
the many administrative agencies created by the state and national
governments would be denuded of their utility and government in some
of its most important exercises become impossible."62
III
The case of Panama Refining Company v. Ryan63 involved no ques-
tion of constitutional power with respect to interstate commerce and
"Federal Trade Comm. v. Klesner, 280 U. S. 19 (1929) ; Federal Trade
Comm. v. Keppel, 291 U. S. 304 (1934). See dissenting opinion of Mr. Justice
Brandeis in Federal Trade Comm. v. Gratz, 253 U. S. 421, 429 (1920) ; HENDER-
SON, FEDERAL TRADE COMMISSION (1924); Handler, The Jurisdiction of the Federal
Trade Commission over False Advertising (1931) 31 COLUMBIA LAW REV. 527.
58 Federal Radio Comm. v. Nelson Bros. Bond & Mtge. Co., 289 U. S. 266
(1933). See Note, Administrative Control of Radio (1936) 49 HARV. L. REV. 1333.
5 Panama Refining Co. v. Ryan, 293 U. S. 388, 421.
60 10 Wheat. 1, 46 (U. S. 1825).
' Marshall Field v. Clark, 143 U. S. 649, 694 (1892), quoting from Locke's
Appeal, 72 Pa. 491, 499 (1873).
6Z Mutual Film Corp. v. Industrial Comm., 236 U. S. 230, 246 (1915).
`3 293 U. S. 388 (1935).
no question of the codes under the National Industrial Recovery Act.

There is nothing in the majority opinion holding or intimating that
Congress could not validly have authorized the President to take the
action which he wanted to take had it done so in a different way." In
one sense, therefore, it might be said of the case that it involved only a
matter of draftsmanship. Nevertheless, the decision constitutes a land-
mark in administrative law.
The sole question before the Court was the validity of Section
9(c),65 under which Congress had authorized the President to prohibit
the transportation in interstate and foreign commerce of so-called "hot
oil," that is, petroleum and its products produced or transported in ex-
cess of a state-fixed quota, and made violations punishable by fine, or
imprisonment. Mr. Justice Hughes delivered the opinion of the major-
ity of eight holding that this Section and the Executive Orders issued
thereunder were without constitutional authority. Mr. Justice Cardozo
dissented.
Both the majority and minority opinions emphasize the foundation
of practical necessity upon which the structure of administrative law
really rests. The Chief Justice, for the majority, said:
"The Constitution has never been regarded as denying to the Congress the
necessary resources of flexibility and practicality, which will enable it to
perform its function in laying down policies and establishing standards, while
leaving to selected instrumentalities the making of subordinate rules within
prescribed limits and the determination of facts to which the policy as declared
by the legislature is to apply. Without capacity to give authorizations of that
sort we should have the anomaly of a legislative power which in many circum-
stances calling for its exertion would be but a futility."'
Mr. Justice Cardozo, in his dissent, said:
"There must be sensible approximation, there must be elasticity of adjustment,

in response to the practical necessities of government, which cannot foresee
today the developments of tomorrow in their nearly infinite variety. . . . III
the complex life of today, the business of government could not go on without
the delegation, in greater or less degree, of the power to adapt the rule to the
swiftly moving facts."'
4Cf. the Connally Act, passed within a month after the decision in Panama
Refining Co. v. Ryan. 49 STAT. 30 (1935), 15 U. S. C. ?? 715-715 (1) (1935). See
President of United States v. Artex Refineries S. Corp., 11 F. Supp. 189 (S. D.
Texas 1935).
48 STAT. 200 (1933), 15 U.S.C. ?709(c) (1934). Both the majority and
minority opinions considered the bearing of the provisions of the first section of
Title I of the National Industrial Recovery Act. 48 STAT. 195 (1933), 15 U. S. C.
?701 (1934).
" 293 U. S. 388, 421 (1935).
67 Id. at 440, 441.
Nor do the two opinions disagree as to the first legal necessity for
the validity of authorization by Congress to an executive officer or an
administrative body. There must be a declared legislative policy and a
reasonably clear standard whereby discretion must be governed. This
requirement, which is inherent in most of the cases on administrative
law, is generally stated as one of constitutional limitation. The only
provisions of the Constitution on the subject are Article I, Section 1,
which provides that "all legislative powers herein granted shall be vested
in a Congress of the United States . . . ," and Article I, Section 8,
Paragraph 18, which empowers Congress to make all laws that shall
be necessary and proper for carrying into execution its general powers.
There is nothing expressed in the Constitution as to the right of Con-
gress to delegate any of its authorities. Nor can reference be made to
any section or paragraph of the Constitution which states that, if there
is delegation, it must be to carry out an expressed Congressional policy
within reasonably clear limits. The doctrine results as a matter of con-
stitutional interpretation by the Supreme Court. In a broader sense, it
is a requirement of good government. An agency of the Federal Gov-
ernment can have broad powers, but it cannot and should not be launched
without direction or control.
The first difference between the majority and minority opinions,
which Mr. Justice Cardozo admits is a narrow one, is whether Congress,
in the statute in question, provided such direction and limitation. There
is obviously none in Section 9(c). The dissenting opinion finds policy
and standard implied in Section 1 of Title 1 of the Act. The majority
points out that there is nothing in the latter Section as to the policy of
prohibiting or not prohibiting the transportation of "hot oil," nor as to
the circumstances in which such transportation should be forbidden.
The dissent looks into the whole structure of the statute and thinks there
is a sufficient standard implied to the effect that the President is to pro-
hibit such transportation when he believes that it is necessary to eliminate
unfair competitive practices, to conserve natural resources, or to pro-
mote the fullest possible utilization of the present productive capacity
of industries. The Chief Justice answers that the general objectives of
the Act were numerous and diverse, and that the President was not
required to choose among them.
The question here involved is one of degree. Obviously, to put an
extreme case, Congress could not declare a general policy that it was
necessary to raise a certain amount by taxation and then leave it to the
President or the Board of Tax Appeals to determine what kind of taxes
should be imposed to raise the necessary amount. At the other extreme
is authority to an executive officer to suspend the running of the statute
upon the happening of a fixed, ascertainable event, such as the instances

considered in another portion of this article.68 An intermediate instance
is the right of the Federal Trade Commission to take action with respect
to "unfair methods of competition."69
There is a clear distinction between the importance to be given to a
Congressional declaration of policy, in determining whether or not
Congress has the power to act upon the particular subject matter,70 and
the use of such a declaration of policy to determine just what Congress
has enacted. The latter situation goes, not to the root of Congressional
power, but to the construction of Congressional legislation. Here the
strong public policy that the delegation of administrative power to gov-
ernmental agencies should be "canalized within banks that keep it from
overflowing"'71 must be balanced against the equally strong policy that
there is a presumption in favor of the validity of Congressional action.
It has been pointed out that, despite its language in a number of
previous cases, the Panama Refining Company case is the first in which
the Supreme Court has held an Act of Congress unconstitutional be-
cause of delegation of power.72 There are several reasons why, in this
case, the Court may have found that the scales tipped against the pre-
sumption in favor of legislative validity:
First, the decision itself stultified no national policy; it is obvious
that new legislation could correct the defect which the Court found.73
Second, the case came to the Court in the midst of what appeared to be
executive disorganization.74 Third, in contrast to legislation in the fields
of interstate carriers, radio and unfair trade practices, there was no ap-
parent necessity for the delegation of broad powers to determine whether
or not the prohibition should be made. Fourth, the fact that this stat-
ute of itself provided no administrative machinery but left its creation
to the President may have had its influence, as is indicated by the refer-
ence in the opinion of the majority to the expert fact-finding bodies
See supra notes 38-41.

f Federal Trade Comm. v. Raladam Co., 283 U. S. 643 (1931) ; Federal Trade
Comm. v. Keppel, 291 U. S. 304 (1934) ; Federal Trade Comm. v. Beech-Nut Pack-
ing Co., 257 U. S. 441 (1922); Federal Trade Comm. v. Klesner, 280 U. S. 19
(1929).
70 Block v. Hirsh, 256 U. S. 135, 154 (1921); Edgar A. Levy Leasing Co. v.
Siegel, 258 U. S. 242, 246 (1922); Talbot v. Silver Bow County, 139 U. S. 438, 443
(1891). Cf. Prentis v. Atlantic Coast Line, 211 U. S. 210, 227 (1908).
7 See Mr. Justice Cardozo in the concurring opinion of himself and Mr. Jus-
tice Stone in Schechter v. U. S., 295 U. S. 495, 551 (1935).
"2Jacoby, Delegation of Powers and Judicial Review (1936) 36 COLUMBIA LAW
REV. 871, 872; Note, Delegation of Power bv Congress (1935) 48 HARV. L. REV.
798; Note, National Recovery Code Assessments (1935) 44 YAIE L. J. 849, 856.
See supra note 64.
7 See comment of majority, 293 U. S. at 412, and Mr. Justice Cardozo's adverse
comment on the administrative methods, 293 U. S. at 434. See (1935) 48 HARV. L.
REV. 798, 799.
created under other Acts of Congress, and as it did in the Schechter

case. The Court, while impressed with the necessity of administrative
machinery, is clearly aware of the dangers of unfettered discretion and
unlimited bureaucracy. The Court's own opinions have gone far to
mold the general form in which administrative bodies in this country
have been cast. The case may have seemed to present an excellent op-
portunity to make the warnings of the Court in previous decisions, which
had been by way of observation or dicta, more concrete.
The greater importance of the Pa,nama Refining case, however,
seems to lie in the decision, as an alternate or additional ground, of the
invalidity of an Executive Order because it contained no finding or
statement of the grounds for the President's action in enacting the
prohibition. This invalidity is grounded on the due process of law
clause of the Fifth Amendment. The dissent of Mr. Justice Cardozo
goes to this feature of the majority opinion as well as to the holding
on the validity of the statute.
It is to be noted that when the majority of eight holds that due
process of law in administrative proceedings requires that an adminis-
trative agency must make a finding of facts to support its order, the
emergence of a new principle of law is clearly announced. While past
decisions of the Court indicate the building of such a rule,75 the Panama
Refining case must be taken as the first statement of the principle as one
which rests upon constitutional requirement independent of statute.76
Apart from precedent and apart from the applicability of the rule to the
case before the Court, the doctrine announced, as applied to quasi-judi-
cial or quasi-legislative agencies, seems to be in the interest of good
government without unduly interfering with the elasticity so necessary
to the functioning of administrative agencies.77 It can be said that the
7 In Florida v. United States, 282 U. S. 194, 211-215 (1931), the Court held
that, although Congress had power to authorize the Interstate Commerce Commis-
sion to establish intrastate rates for the removal of undue prejudice against inter-
state commerce, the order of the Commission was invalid because there were no
basic or essential findings of fact. No question under the Fifth Amendment was
involved. The decision is said to rest upon the question of "the propriety of the
exertion" of a delegated constitutional authority. Wichita R. R. & L. Co. v. Pub.
Util. Comm., 260 U. S. 48, 58 (1922), turned upon a question of statutory construc-
tion, but the Court, by way of dictum, in holding that the State statute, properly
construed, required the order of a public utility commission to find existing rates
unreasonable before reducing them, said that this conclusion also rested upon
"general principles of constitutional government." This language was quoted with
approval in Mahler v. Eby, 264 U. S. 32 (1924), in which the Court held a deporta-
tion order of the Secretary of Labor invalid because, contrary to the statute, he did
not find that the alien was an undesirable resident.
"See (1935) 35 COLUMBIA LAW REV. 280, 281; Note (1935) 48 HARV. L. REV.
798, 804.
' "The science of administration owes its being to the fact that most government
affairs are run by men of average capabilities, and that it is necessary to supply
such men with a routine and a ready-made technique, and to confine them to a
formal procedure which may indeed at times clip the wings of genius, but which
will serve to create conditions under which average men are more likely to arrive
at just results." HENDERSON, THE FEDERAL TRADE COMMISSION (1924) 328.
rule only provides for a formal requirement which can be complied with
as a matter of routine.78 The necessity of findings, however, in the
comparatively few cases where it is not already a part of the adminis-
trative machinery provided by statute, should tend to crystallize the rea-
soning of the agencies involved and, even more important, may tend to
canalize judicial review.
Mr. Justice Cardozo believes that the point should be determined
upon the well-established principle that every public officer is presumed to
act in obedience to his duties until the contrary is shown. This rule of
law, it should be noted, applies as much to minor state officials as to the
President of the United States.79 In fact, and as the Supreme Court
has recognized, the President cannot exercise all his functions in per-
son.80 When, therefore, Mr. Justice Cardozo in his dissent points out
that the action is to be taken by the President, he is evidently emphasiz-
ing what he believes to be the reason for applying the rule rather than
any differentiation in the rule itself. The majority opinion does not
question the rule, but holds that it does not apply.
The basic question before the Court on this point, therefore, was
whether the presumption of validity as to executive action includes a
presumption as to the finding of fact. The question of whether a legal
process is legislative, executive or administrative is not a new one; in
the past, the decision often turned upon what sort of official was to do
the particular act.81 In the Panama Refining case, that is the ground on
78In his dissenting opinion on this point, Mr. Justice Cardozo refers to the
question as subsidiary, pointing out that if the statute were valid, another order
with fuller findings or recitals would correct the informality of the one before the
Court. Panama Refining Co. v. Ryan, 293 U. S. 388, 444.
7 Of the cases cited in the minority opinion on this point, only three relate to
Presidential action. Martin v. Mott, 12 Wheat. 19 (U. S. 1827) (right of the
President to call forth the militia when the United States shall be in imminent
danger of invasion) ; The Confiscation Cases. United States v. Clarke, 20 Wall.
92, 109 (U. S. 1873) (confiscation of property of certain classes of persons
during the Civil War) ; United States v. Chemical Foundation, 272 U. S. 1, 14
(1926) (sale of alien property under the Trading with the Enemy Act). The
others deal with similar presumption given to the acts of other officials. Philadel-
phia & T. R. Co. v. Stimpson, 14 Pet. 448, 458 (U. S. 1840) (Secretary of State-
issuance of patent); Rankin v. Hoyt, 4 How. 327, 335 (U. S. 1846) (Collector of
Customs) ; Carpenter v. Rannels, 19 Wall. 138, 146 (U. S. 1874) (Board of Com-
missioners created by Congress to adjudicate certain questions pertaining to land
arising out of part of the Louisiana purchase) ; Knox County v. National Bank,
147 U. S. 91, 97 (1893) (State County Court-local election).
" United States v. Chemical Foundation, 272 U. S. 1, 14 (1926); Confiscation
Cases, 20 Wall. 92 (U. S. 1873). One of the Executive Orders before the Supreme
Court in the Ryan case, that of July 4, 1933, designated the Secretary of the In-
terior to exercise all the powers vested in the President for the purpose of enforc-
ing ? 9(c), "including full authority to designate and appoint such agents, and to
set up such boards and agencies as he may see fit, and to promulgate such rules and
regulations as he may deem necessary." See J. W. Hampton, Jr. & Co. v. United
States, 276 U. S. 394 (1928).
' See Goodnow, The Writ of Certiorari (1891) 6 POL. SCI. Q. 492, 507-510;
GOODNow, THE PRINCIPLES OF THE ADMINISTRATIVE LAW OF THE UNITED STATES
(1925) 9; and RoBSON, JUSTICE AND ADMINISTRATIVE LAW (1928) 6-11.
which the dissent on this point rests, but the majority opinion looks to
the substance of the process and finds that while the function is entrusted
to the executive, it is in essence a matter of administrative law.
This holding shows the evolutionary process at work. In its de-
cisions on the constitutional question of the validity of the delegation of
legislative power, the Court has relied heavily upon the delegation given
to the President by the first Congresses; indeed, that history is again
given in the majority opinion in the Pantama Refining Company case.
Yet in another aspect of administrative law, involving the due process
clause, the same early statutory precedents are distinguished. There is
an obvious distinction in fact between the power of the President, under
certain stated conditions, to discontinue a restraint imposed by Congress
upon trade with certain countries, and the powers given to federal ad-
ministrative boards, such as the Interstate Commerce Commission. The
validity of the latter may in part rest upon the former, but, in govern-
ment as in biology, a difference in degree and in complexity of organi-
zation, while in the same line of development, may result in a difference
of species. A certain kind of administrative body, in short, has im-
perceptibly come to be a legal organism which the Court will recognize
when it exists, and which the Court will differentiate from its simpler
predecessor.
If an organism of the quasi-legislative or quasi-judicial kind has
been created, its distinctive nature will not be blurred by reason of the
circumstance that Congress may have created it through the device of
empowering the President. Between the two examples, there are many
conceivable situations where the boundary between action which is really
executive in nature and action which is a part of quasi-judicial adminis-
tration may not be clear. That boundary, like the line in questions of
due process of law, cannot be defined by legal survey; it must be estab-
lished by inclusion and exclusion, by specific decisions of the Court on
concrete cases as they arise.82 The present case may well be regarded
as one of the intermediate instances, so that the importance of the de-
cision on this point lies, not in the particular side of the boundary line
upon which the process is held to fall, but upon the action of the Court
in looking through the form of Congressional Act before it and regard-
ing the substance of the process. In holding that, irrespective of the
form, the workings of administrative machinery are to be governed by
the rules of law evolved for that type of government, the Court again
has evinced a realistic view.
82 Green v. Frazier, 253 U. S. 233, 238 (1920) * see Justice Holmes' dissenting
opinion in Haddock v. Haddock, 201 U. S. 562, 631, 632 (1906).
IV
The resounding crash with which the unanimous decision in Schech-
ter v. United States83 brought the N.R.A. into ruins, and the far-
reaching nature of that portion of the decision which deals with inter-
state commerce, have tended to obscure the nature of the Court's decision
on the question of administrative law involved. On this phase of the
decision, it becomes important to ascertain just what facts were before
the Court and what the Court did not decide, as well as what it did.
The Live Poultry Code, which was before the Court, applied to the
industry of the metropolitan area in and about the City of New York. It
fixed the number of hours for workdays, a minimum hourly scale of
wages and a minimum number of employees to be employed by slaughter
house operators. Employment of persons under sixteen years of age
was prohibited, and the collective bargaining language of Section 7A of
the N.R.A. was incorporated. It prohibited certain "trade practice
provisions" which were said to constitute "unfair methods of competi-
tion." Provisions were made for such reports as the Secretary of
Agriculture and the Administrator for Industrial Recovery might re-
quire for the protection of consumers, competitors, employees and
others, and for the determination of the extent to which the declared
policy of the Act was being effectuated by the Code. The members of
the industry were required to keep books and records which would
clearly reflect all financial transactions, and to submit weekly reports
showing the range of daily prices and volume for each kind of product.
The Code was to be administered by an "Industry Advisory Committee"
to be selected by trade associations and members of the industry. A
Code Supervisor was to be appointed with the approval of the Com-
mittee by agreement between the Secretary of Agriculture and the Ad-
ministrator for Industrial Recovery. The expenses of administration
were to be borne by members.of the industry upon such basis as the
Committee deemed advisable, subject to the approval of the Secretary of
Agriculture or the Administrator for Industrial Recovery. Application
was made to the President for approval of the Code under Section 3 of
the National Industrial Recovery Act.84 The President found that the
Code imposed no inequitable restrictions on administration to member-
ship, that it was not designed to promote monopolies and would tend
to effectuate the policies of Congrejs as declared in Section 1 of Title 1
of the Act, and thereupon approved it. He also had before him the ap-
proving reports of the Secretary of Agriculture and the Administrator
for Industrial Recovery.
8 Schechter v. United States, 295 U. S. 495, 530 (1935).

84 48 STAT. 195, 196 (1933), 15 U. S. C. ? 703 (1934).
The case came to the Supreme Court on writs of certiorari to the

United States Circuit Court of Appeals for the Second Circuit to re-
view a judgment of the District Court for the Eastern District of New
York upon a criminal conviction of the defendants for violating certain
provisions of the Code. Of the eighteen counts of the indictment upon
which the defendants were convicted, apart from the counts of con-
spiracy, two counts charged violation of the minimum wage and mini-
mum hours. The other ten counts were for violation of one of the trade
practice provisions of the Code. These ten counts involved charges that
the defendants, in selling to retail dealers and butchers, had permitted
selection of individual chickens taken from particular coops, sale to a
butcher of unfit chickens, sales without having the poultry inspected or
approved in accordance with the regulations and ordinances of the City
of New York, failing to make reports as to range of daily prices and
volumes of sales, and sales to slaughterers or dealers who were without
licenses from the City of New York.
The Court unanimously reversed the judgment of conviction. The
Chief Justice delivered the opinion of the Court. Mr. Justice Cardozo
delivered a concurring opinion in which Mr. Justice Stone joined. The
Code provisions in question were held invalid both because of attempted
regulation of intrastate transactions, which it was held affected inter-
state commerce only indirectly, and because of the attempted delegation
of legislative power.
The Court did not decide that Congress, within the Court's interpre-
tation of the commerce clause, could not validly confer authority to
make codes relating to industries. The decision is that the particular
kind of code-making authority before the Court was invalid. In com-
menting upon the kind of code-making authority before it, the Court
refers to five possible features which were nonexistent:
(1) The statutory plan before the Court was not confined to volun-
tary effort, but attempted to provide that the codes bind all persons
within their reach under the operation of positive law, with violations of
the provisions being punishable as crimes. It did not "seek to endow
voluntary trade or industrial associations or groups with privileges or
immunities."
(2) The authority to make codes was not limited to a category of
legal concepts established in the law. The term "fair competition," as
used in the Act, was not antithetical to the "unfair methods of com-
petition" of the Federal Trade Commission Act. The Act, the Court
found, applied no standards to any trade, industry or activity.
(3) No limits were set to the exercise of the President's discretion
in promulgating a code, other than the provisions relating to the status
of the initiators of the new laws, monopolies, discriminations against

small enterprises, and effectuation of the general policies of the Act.
(4) The Act provided no governmental quasi-judicial body of ex-
perts for the administration of the codes at all comparable with such
existing governmental bodies as the Federal Trade Commission, the
Interstate Commerce Commission, the Federal Radio Commission and
the Tariff Commission. The provisions of the Act for the creation by
the President of administrative agencies to assist him fell far short of
such tribunals, as their recommendations and findings had no sanction
beyond the will of the President.
(5) There were no provisions for "appropriate administrative pro-
cedure," that is, the kind of administrative machinery with which the
country has become familiar, involving provisions for formal com-
plaint, for notice and hearing, for appropriate findings of fact supported
by adequate evidence, and for judicial review.
If the Code in question had applied only to what the Court con-
sidered interstate commerce, and if the code-making authority had con-
tained some or all of these non-existent features, there is nothing in
the decision to indicate that the convictions would not have been sus-
tained and the Code declared valid. It does not follow, of course, that
this would have been the case. It is submitted, however, that the ab-
sence of these features, particularly the last four, is the turning point of
the Court's decision. The question of standards or lack of standards
for administrative action is here present in two aspects; first, the adop-
tion of the Code by the industry, which the Court treats as an attempt
of Congress to delegate its legislative authority to industrial associations
to empower them to enact laws which they deem to be wise for the ex-
pansion of their trades; and, second, the promulgation of the Code by
the President, which the Court regards as giving practically unlimited
executive discretion to enact laws which he may deem to be beneficial
in "dealing with the vast array of commercial and industrial activities
throughout the country." This discretion seems considerably broader
than that before the Court in Panama Refining Company v. Ryan,
where the executive authority was to be invoked only to prohibit or not
to prohibit the transportation of "hot oil."85 The setting up by Congress
of concrete standards in this connection would present far greater diffi-
culties than were involved in the Connally Act. Questions of general
policy would have to be thought through and decided by Congress rather
than left to the decision of a particular industry. That, however, would
not necessitate Congress legislating upon the propriety of selecting in-
8" See Note (1935) 48 HARV. L. REV. 798, 804.
dividual chickens from particular coops. The legislation with respect

to the Federal Trade Commission has, as the Court points out, left a
general concept to be worked out by administrative and judicial deter-
mination. In all probability, more will be heard both from Congress
and from the Supreme Court as to what is the antithesis of "unfair
methods of competition."
Perhaps the outstanding feature of the decision in the Schechter
case on the question of administrative law is the emphasis which the
Court places upon the development of administrative machinery through
the sort of tribunals which it has in the past held valid. This portion
of the Court's opinion is no mere historical review; the approval of the
Court of the established technique of such governmental expert bodies
as those to which it refers is manifest. The N.R.A. made provision
neither for governmental expert bodies nor for the form of administra-
tive machinery which has grown up in this country, act by act and de-
cision by decision, in the last half century. There could be no greater
contrast than between the Minerva-like conception of the N.R.A. and
the gradual growth of the powers and machinery of the Interstate Com-
merce Commission. When the Court says that "Section 3 of the Re-
covery Act is without precedent," obviously more is meant than that
there is no prior case on all fours with this aspect of the Schechter de-
cision. The lack of precedent is to be found in the development of ad-
ministrative tribunals. That administrative machinery, which in itself
was a departure from previous concepts, on the whole, is proving ade-
quate for modern governmental needs. It has been found elastic enough
to provide for the carrying out of national policies, and it gives oppor-
tunity for a fair process of justice to those whom it affects. The N.R.A.
did not attempt to use this machinery, nor any analogy to it, but struck
out on a new and uncharted course.
If industry is to be regulated by Congress within certain limits, the
attempt after the Schechter decision must almost necessarily be made
through bodies of governmental experts constituting quasi-judicial and
quasi-legislative boards or commissions, who are given certain desig-
nated objectives and who must carry out the policies entrusted to them
in the manner with which we have already become familiar through
other similar legal organisms. If we have come to require greater regu-
lation of industry than has previously been known, at least the governing
device must comply with the concepts of administrative law which have
already been worked out. This is not a doctrine of constitutional
stagnation; on the contrary, the use of existing forms to meet new
circumstances is a principle of statesmanship.
In this aspect, the Court's decision in the Schechter case is far from
the absolute negation it presents on the question of interstate com-

merce.86 If viewed with some time perspective, it is significant that in
so short a span the necessity of the administrative tribunals has become
so clearly recognized. These institutions, are themselves largely new as
history goes, and, as another group of recent decisions of the Supreme
Court shows, they are still in process of development. The importance
of this phase of the Schechter case on future legislation and future de-
cisions may well be the stress it impliedly lays upon the practicality and
fairness of this new form of governmental body.
The Court's decision in Carter v. Carter Coal Company,87 apart
from its intrinsic importance, casts additional light upon the decision
in the Schechter case. In the Carter case, the majority of the Court
declared the Bituminous Coal Conservation Act of 193588 unconstitu-
tional. The decision involves questions of interstate commerce which
will not here be considered, but it also involves questions of administra-
tive law. Mr. Justice Sutherland delivered the opinion of the Court
for the majority of five. Apart from the question of interstate com-
merce, he found the labor provisions of the Act unconstitutional as im-
proper delegation of power and in violation of the due process of law
clause. The majority thought the labor provisions of the Act insepa-
rable from the price-fixing provisions and declared the entire Act un-
constitutional, without considering the price-fixing provisions. Mr.
Chief Justice Hughes delivered a separate opinion agreeing with the
majority, except on the point of separability. He believed the Act and
the Code for which it provided, except for the labor provisions, should
be sustained. Mr. Justice Cardozo delivered the dissenting opinion
for Mr. Justice Brandeis, Mr. Justice Stone and himself. This minority
of three agreed with the Chief Justice that the provisions of the Act
were separable. They believed that the labor provisions were not
properly before the Court, and that the price-fixing provisions were
constitutional. It is to be noted that the majority and minority opinions
did not impinge at all, except upon the separability of the various pro-
visions of the Act. The majority considered the labor provisions, which
they found unconstitutional, and did not consider the price-fixing pro-
visions. The minority considered the price-fixing provisions, which they
found constitutional, but did not consider the labor provisions. The
Chief Justice, in a separate opinion, agreed with what the majority
said as to the labor provisions, and with some of what the minority said
as to the price-fixing provisions.
'See Powell, Commerce, Pensions, and Codes (1935) 49 HARV. L. REV. 1.
8B56 Sup. Ct. 855 (1936).
'Act of August 30, 1935, c. 824, 49 STAT. 991-1008 (1935), 15 U. S. C. A.
??801-827 (Supp. 1936).
The Act before the Court set up two different kinds of adminis-
trative machinery. As to price-fixing, it provided for the establishment
in the Department of the Interior of a National Bituminous Coal Com-
mission to be composed of five members appointed by the President,
with the consent of the Senate, for a definite term. There were pro-
visions for rules and regulations, hearings and investigation, and court
review of the orders of the Commission, and, in general, the framework
of the Act, insofar as the Commission was concerned, was in the line of
the federal administrative bodies which the court has upheld. The
Act further required the organization of twenty-three coal districts, each
with a district board, the number and membership of which, subject to
the approval of the Commission, was to be determined upon a produc-
tion or tonnage basis. The rules of these boards were also subject to
the approval of the Commission. The Act provided for the establish-
ment of minimum prices for coal in a Code, under the rules and regu-
lations established by the Commission, and gave the Commission, under
certain circumstances, the right to establish maximum prices. Certain
standards were laid down to which the prices to be fixed must conform.
The Act also provided for a Bituminous Coal Labor Board con-
sisting of three menmbers to be appointed by the President, with the
consent of the Senate, and to be assigned to the Department of Labor,
one of the members of which was to be a representative of the pro-
ducers, one a representative of the organized employees, and the other
to be impartial. The Labor Board was to transmit its findings and
orders to the Commission, but was to be a separate entity. There was
a separate right of appeal from the orders of the Labor Board to the
Circuit Court of Appeals. Authority was conferred upon the Board to
adjudicate labor disputes, to determine whether an organization of em-
ployees was dominated by the employer, and to order code members to
meet representatives of the employees for the purpose of collective bar-
gaining. It was further provided that, whenever the maximum daily
and weekly hours of labor were agreed upon in any contract between the
producers of more than two-thirds of the annual tonnage production for
the preceding year and representatives of more than one-half of the
mine workers employed, those maximum hours must be accepted by all
the code members. Any wage agreement negotiated by collective bar-
gaining in any district or group of districts between similar percentages
of the representatives of the producers and of the mine workers therein
must be filed with the Labor Board and must be accepted as the mini-
mum wages for the code members in such district or districts.
The majority opinion condemns the labor provisions as "legislative
delegation in its most obnoxious form." After this phrase of denunci-
ation come the significant words "for it is not even delegation to an

official or an official body, presumptively disinterested, but to private
persons whose interests may be and often are adverse to the interests
of others in the same business." The opinion then differentiates between
producing coal and regulating its production. The former, it says, is a
private activity, the latter necessarily a governmental function. The at-
tempt to confer the power or regulation to one group is referred to as
an unconstitutional interference with personal liberty and private prop-
erty and a violation of the due process of law provisions of the Fifth
Amendment.
The Chief Justice agrees in toto with the ruling on due process of
law. On the question of delegation of powers, he finds that the Act was
an attempt to delegate the power of legislation to fix hours and wages
without standards or limitation. Such an attempt without proper stand-
ards or limitation cannot, he believes, be constitutionally delegated either
to private persons or designated officials. He does not consider the
other machinery for the fixing of prices, except to comment that it is
"elaborate" and that the Act provides for a review of the administrative
determinations.
The opinion of Mr. Justice Cardozo on the question of administra-
tive law, as confined to the price-fixing provisions, first finds that, in this
particular, there has been no excessive delegation of legislative power.
He outlines the standards to which the prices fixed by the Boards and
Commission must conform:
"they must be just and equitable; they must take account of the weighted aver-
age cost of production for each minimum price area; they must not be unduly
prejudicial or preferential as between districts or as between producers within
a district; and they must reflect as nearly as possible the relative market value
of the various kinds, qualities and sizes of coal, at points of delivery in each
common consutming market area; to the end of affording the producers in the
several districts substantially the same opportunity to dispose of their coals on
a competitive basis as has heretofore existed. The minimum for any district
shall yield a return, per net ton, not less than the weighted average of the total
costs per net ton of the tonnage of the minimum price area; the maximum
for any mine, if a maximum is fixed, shall yield a return not less than cost
plus a reasonable profit."
He concludes this portion of the opinion by pointing out that:
"a bench of judges, not experts in the coal business, cannot say with assurance
that members of a commission will be unable, when advised and informed by
others experienced in the industry, to make the standards workable, or to
overcome through the development of an administrative technique many ob-
stacles and difficulties that might be baffling or confusing to inexperience or
ignorance."
All three of the Justices whose opinion Mr. Justice Cardozo ex-
pressed concurred in the opinion in the Schechter case. No inference
as to whether the other six Justices agreed with what the three said
in the Carter case is to be drawn, but the fact remains that an attempt
made subsequent to the decision in the Schechter case to provide suffi-
cient standards and limitation in a code to govern an important industry
was considered successful by the only three Justices who passed upon
the question. The chief importance of the Carter case in the field of
administrative law, it is submitted, is in this undisputed finding of the
three Justices that Congress can make provisions for a code for industry
when proper standards and administrative machinery are provided.
Just as the Carter case evidences the possibility of valid administra-
tive regulation of prices, the Minimum Wage case89 shows, and even
more strongly, the possibility of valid administrative regulation in the
matter of wages. The Minimum Wage case turns on the power of a
state legislature to establish minimum wages for women. A majority of
the Court, for whom Mr. Justice Butler delivered the opinion, held that
the action was repugnant to the due process of law clause of the Four-
teenth Amendment; MIr. Chief Justice Hughes delivered the dissenting
opinion for himself, Mr. Justice Brandeis and Mr. Justice Stone. Mr.
Justice Cardozo delivered a concurring dissent.
In the majority opinion, it was assumed that the rates were fairly
made in accordance with the procedure prescribed by the Act, "and in
full compliance with the defined standards." The barrier which the
majority found was that the state had no power to enter upon regulation
of the sort undertaken. If the asserted power of the state was incon-
sistent with the due process of law clause, "then plainly it cannot by
diligence to insure the establishment of just minima create power to
enter that field." True, the intimation of diligence is based upon an
assumption, but at least the majority does not express any difference
from the minority on this point.
The Chief Justice, in the dissent, refers to the minimum wages in
question as "defined in the New York statutes and ascertained in a rea-
sonable manner by competent authority." He alludes to the "safe-
guards of the statute," and characterizes its procedural provisions as
"careful and deliberate." Those provisions "at once dispose of any
question of arbitrary procedural action."
The administration provisions so praised by the Chief Justice may
be contrasted with the labor provisions which he condemned in the
Bituminous Coal Conservation Act. The minimum wages in the Coal
Act were to be fixed by majority agreement of the employees and em-
89 Morehead v. New York ex rel. Tipaldo, 56 Sup. Ct. 918 (1936).
ployers; in the New York Act,90 only a "fair wage," one defined as
"fairly and reasonably commensurate with the value of the service or
class of service rendered," could be fixed, and could be fixed only when
it was found that a substantial number of women or minors were re-
ceiving "oppressive and unreasonable" wages, which term again was
carefully limited. The two Acts resembled each other in the constitu-
tion of the wage board; in both cases, the board was to be composed of
an equal number of representatives of employees and employers, with
the balance held by disinterested members. In the Coal Act, however,
the Board, on minimum wages, was merely a depository for the agree-
ment between the two groups, which was to control the whole district.
In the New York Act, the Board, after investigation, was to report to
the Commissioner who appointed it. He might approve or disapprove
its report; if he approved, he was to make a "directory order" which
must define minimum wage rates and include appropriate administrative
regulations, the subject matter of which the Act indicated. This di-
rectory order was to be tentative, and while it was in effect, the Commis-
sioner's sole right, after notice and hearing, was to publish the name of
an employer found not to have complied with it. After the tentative
order had been in effect nine months, it could be made mandatory, after
notice and a public hearing. Fine or imprisonment could be imposed
only after the tentative order had been made mandatory. In short, the
Coal Act put the entire wage regulation in the hands of industry with-
out standards or administrative safeguards; the New York Act put it
in the hands of an administrator who could act only according to care-
fully defined standards, and under safeguards of investigation, reports,
tentative orders, notices and public hearings.9'
V
In Rathbun v. United States92 the Court had before it another phase
of administrative law, the status of members of a quasi-judicial adminis-
trative body. William E. Humphrey had been nominated by President
Hoover to succeed himself as a member of the Federal Trade Commis-
sion, and was confirmed by the Senate. President Roosevelt asked him
to resign, disclaiming any reflecting upon him personally or his services,
but because the President did not feel "your mind and my mind go
9 N. Y. Laws 1933, c. 584.
9 This discussion presupposes that constitutional means will be found to keep a
field of necessary social legislation from permanent status as a no-man's land, into
which neither Federal nor State Government has the right to enter.
'a295 U. S. 602 (1935). The Court was unanimous in its decision; Mr. Justice
Sutherland delivered the Court's opinion, with Mr. Justice McReynolds noting his
agreement and referring to his separate opinion in Myers v. United States, 272 U. S.
52, 178 (1926) for a statement of his views.
along together on either the policies or the administering of the Federal

Trade Commission." The Commissioner refused to resign, and the
President wrote him that he was removed. Humphrey did not acquiesce
and claimed he was still a member of the Commission. His executor
brought suit for his salary from the date of the President's notice of
removal. The Court of Claims certified two questions to the Supreme
Court, first, whether the provisions of the Federal Trade Commission
Act93 stating that a commissioner could be removed by the President
for "inefficiency, neglect of duty, or malfeasance in office," limited the
President's power of removal to those specific causes; and second, if the
Act did so limit the power, was such a limitation constitutional. The
Court answered both queries in the affirmative.
The first question was one of statutory construction. The Court
distinguished Shurtleff v. United States,94 which involved a general ap-
praiser of merchandise, under an act with the same phraseology, on the
grounds that in the earlier case, no term of office was fixed by the Act,
and a contrary decision would have meant construing the statute by
implication to give the appraiser the right to hold office during his life
or until found guilty of some act specified in the statute. In answering
the second question, the Court overruled its dictum in the Myers case.95
The Court stresses the nature of the Federal Trade Commission,
"'an administrative body created by Congress . . . in accordance with
the legislative standards therein prescribed . . . as a means of carrying
into operation legislative and judicial powers." "Its duties are neither
political nor executive, but predominantly quasi-judicial and quasi-legis-
lative. Like the Interstate Commerce Commission, its members are
called upon to exercise the trained judgment of a body of experts 'ap-
pointed by law and informed by experience.' " Congress clearly intended
to create "a body of experts who shall gain experience by length of
38 STAT. 717 (1914), 15 U. S. C. ?? 41, 42 (1934).

9189 U. S. 311 (1903).
9 "Then there may' be duties of a quasi-judicial character imposed on executiv
officers and members of executive tribunals whose decisions after hearing affect in
terests of individuals, the discharge of which the President cannot in a particular
case properly influence or control. But even in such a case he may consider the
decision after its rendition as a reason for removing the officer, on the ground that
the discretion regularly intrusted to that officer by statute has not been on the
whole intelligently or wisely exercised. Otherwise he does not discharge his own
constitutional duty of seeing that the laws be faithfully executed." Myers v. United
States, 272 U. S. 52, 135 (1926). The Myers case was one of the most fully argued
and carefully considered cases before the Court. The opinion of the majority, de-
livered by Chief Justice Taft, and the separate dissenting opinions of Justice
Holmes, Mr. Justice McReynolds and Mr. Justice Brandeis, together total 188
pages. The majority opinion in that case overruled a dictum by Chief Justice
Marshall in Marbury v. Madison, 1 Cranch 137, 162, 165, 166 (U. S. 1803), which,
however, is relied upon by the Court in the Rathbun case in discarding the
MIyers dictum.
service-a body which shall be independent of Executive authority,

except in its selection, and free to exercise its judgment without the leave
or hindrance of any other official or any department of the govern-
ment."
The field of doubt left between the Myers case, sustaining the un-
restrictable power of the President to remove purely executive officers,
and the holding in the Rathbun case, that the President has no constitu-
tional right to remove a member of an independent quasi-legislative or
judicial commission, is left open for future consideration as cases may
arise. While the Myers case relies on considerations other than his-
torical precedent, and while the Rathbun case refers to such precedent,
the difference in approach between the two cases seems evident. Most
of the seventy page opinion of Chief Justice Taft in the former case is
concerned with an effort to ascertain the intent of the framers of the
Constitution; the emphasis in the Rathbun case is upon the nature and
function of the administrative body with which it is dealing.
The Rathbun case has been criticized as depriving the President
of necessary power should a Commissioner prove partisan, and it is
argued that the possibility of public disapproval or even impeachment
provides sufficient sanctions to limit the President to a reasonable ex-
ercise of the authority.96 There is, however, nothing in the decision to
prevent Congress from giving either the President or itself powers of
removal in addition to the ones stated in the Act. One of the necessities
in administrative government, to insure the proper carrying out of the
policy entrusted to the agency, is the development of trained and in-
dependent administrators. Such an administrator, like a judge, should
not be handicapped by the fear of election returns in which, in all prob-
ability, considerations of his own record play no part. Popular reaction
to the policies which the agency is carrying out can take effect quickly
enough in legislation affecting those policies, but unless there is such a
change or unless he is guilty of inefficiency, neglect or malfeasance, a
member of such a commission should be allowed the independence which
his work requires. In holding that there is no constitutional ban to
such independence, it is submitted that the Supreme Court has erected
an important arch in the structure of administrative law.
In the Hoosac Mills case,97 the question of the validity of the dele-
gation of power to the AAA was argued by counsel, but not passed upon
by the Court. Three subsequent cases, however, deal with questions of
administrative law, with particular respect to the functioning of admin-
istrative tribunals.
96 (1935) 35 COLUMBIA LAW REV. 936.

" United States v. Butler, 279 U. S. 1 (1936).
VI
The Securities and Exchange Commission, whose functioning was
before the Court in the Jonles case,98 is a new quasi-judicial tribunal, but
one whose inception and structure is strikingly dissimilar to some of the
bodies the Court declared unconstitutional in the cases above considered.
The Securities Act of 193399 was the outgrowth of the experience of
many years of State Blue Sky laws, enacted in some form by forty-six
states.'00 It has many similarities to the British Companies Act of
1928-9.101 Administration, originally given to the Federal Trade Com-
mission, was placed in the Commission, as an independent body, by the
Securities Exchange Act of 1934,102 and this body was subsequently
entrusted with the administration of the Public Utility Holding Com-
pany Act of 1935.103 It consists of commissioners appointed by the
President with the consent of the Senate, who have broad powers of
investigation and rule-making, but who act within familiar administra-
tive safeguards. In general, although it has larger powers, the nature
of the Commission seems in line with State Blue Sky Commissions, of
the kind which the Supreme Court has upheld.104 The Commission has
separate divisions and regional offices; it issues annual reports,'05 and
its decisions are published.'06 The powers of Congress to legislate in
the matters entrusted to the Commission have not been settled, and
questions of the definiteness of the standards of the legislation will al-
most inevitably arise,'07 but, without attempting to anticipate those ques-
tions, the administrative framework of the statutes seems to have been
prepared with lawyer-like care, and with regard to the existing prec-
edents.
9298 U.S. 1(1936).

9948 STAT. 74 (1933) as amended by 48 STAT. 881, 905 et seq. (1934), 15 U. S. C.
?? 77a et seq. (1934).
' Legal Aspect and Need of Federal Securities Regulation, prepared by De-
partment of Commerce, appearing in Hearing before the Commtittee on interstate
and Foreign Commerce on H. R. 4314, 73d Cong., 1st Sess. (1933) 87; PRESIDENT'S
REPORT, PROCEEDINGS OF THE NATIONAL ASSOCIATION OF SECURITIES COMMIS-
SIONERS (1933) 21, 22; SEN. REP. No. 1455, 73d Cong., 2d Sess. (1934) 93, 100,
101; REP. POSTMASTER GENERAL (1934) 56.
... Kessler, The Secutrities Act and Its Foreign Counterparts (1935) 44 YALE
L. J. 1133; Frankfurter, The Federal Securities Act; II (1933) 8 FORTUNE 53.
' 48 STAT. 881 (1934), 15 U.S.C. ?78a et seq. (1934).
10349 STAT. 838 (1935) 15 U. S. C. A. ? 79 et seq. (Supp. 1936).
104 Hall v. Geiger-Jones Co., 242 U. S. 539 (1917); Caldwell v. Si
Stock Yard Co., 242 U. S. 559 (1917) ; Merrick v. Halsey & Co., 242 U. S. 568
(1917).
105 See First Annual Report of the Securities and Exchange Commission, for
the Fiscal Year Ended June 30, 1935.
1" See 1 Opinions of the Securities and Exchange Commission, No. 1, Septem-
ber 21, 1935.
10 See Legis., Delegation of Powers under the Securities Exchange Act (1936)
36 COLUMBIA LAW REV. 974; cf. Note, Investigating Powers of The Securities
Exchange Commission (1936) 23 VA. L. REV. 88.
In the Jones case, the petitioner had filed a registration statement

with the Commission covering a proposed issue. It appeared to the
Commission that this registration statement included untrue statements
of material facts and omitted material facts necessary to make the state-
ments not misleading; it accordingly directed that stop order proceedings
be instituted. The petitioner was notified. At the hearing, which the
petitioner did not attend, his counsel attempted to withdraw the regis-
tration statement, but the Commission refused its consent. The officer
conducting the hearing issued a subpoena directing the petitioner to
appear before him on a subsequent date to testify regarding his regis-
tration statement. This subpoena was duly served, but on the date des-
ignated, petitioner failed to appear, and through his counsel, presented
a dismissal of the registration statement, a motion to dismiss and a
motion to quash the subpoena, all of which were denied. Thereafter,
the District Court, upon application of the Commission, passed an order
directing the petitioner to appear before the Commission to testify in
the matter of his registration statement, and to answer any pertinent
questions with respect to the information and documents previously
filed with the Commission on the registration statement. A regulation
of the Commission provided that any registration statement could be
withdrawn upon application of the registrant, if the Commission con-
sented thereto, and that "such consent shall be given by the Commission
with due regard to the public interest and the protection of investors."
The stop order proceedings were taken under Section 8(e) of the
Act. Section 19(a) gives the Commission power to make such rules
and regulations as might be necessary to carry out the provisions of the
Act, and Section 19(b) gives it power to subpoena witnesses for the
purpose of all investigations which, in the opinion of the Commission,
are necessary and proper for the enforcement of the Act. Section 20
provides that whenever it shall appear to the Commission that any per-
son is engaged, or about to engage in violations of the Act, it may trans-
mit such evidence as may be available thereof to the Attorney General,
who may institute criminal proceedings.
The Court did not consider the constitutional validity of the Act.
The majority, Mr. Justice Sutherland delivering the opinion, assumed,
without deciding, that the regulation of the Commission as to the
dismissal of the registration statements was within its power and in force,
but held that the action of the Commission in this case was unreasonable
and arbitrary. The majority held that the stop order proceedings were
governed by the principle governing injunctions, that the registrant
had the right to dismiss his application, just as a plaintiff has the right
to dismiss his complaint or bill, and that no right of the general public
could be affected by the withdrawal of the application. Mr. Justice

Cardozo delivered a dissenting opinion for Mr. Justice Brandeis, Mr.
Justice Stone and himself.
The majority opinion seems to turn upon the finding that there was
no public interest involved to sustain the action of the Commission in
refusing to consent to the dismissal of the registration statement. The
Court was unable to see any basis for the suggestion of prejudice to the
public or investors, beyond the assumption that "an unlimited privilege
of withdrawal would have the effect of allowing registrants whose
statements are defective to withdraw before a stop order was issued and
then to submit another statement with slight changes." This assump-
tion was held insufficient to justify the action. The minority opinion
points out additional public interests which were involved-prevention
for the future by publication of the results of investigation; the possi-
bility of civil liability for damages under Section 12 of the Act; aid to
the enforcement of the Act by exposure of guilt to public censure; and
the possibility, under Section 24 of the Act, of exposure of facts involv-
ing penal liability, for transmission to the Attorney General.'08
The basic question before the Court was whether the controversy
was to be governed by analogy to the procedural rules of common law
action, where only the rights or liabilities of an individual are con-
cerned, or whether there were sufficient grounds of public policy to
justify further proceedings. It would seem that unless the order of the
District Court violated due process of law or other constitutional pro-
tections of individual liberty the order was proper. The presumption
that the action of a quasi-judicial tribunal is taken in accordance with
its powers seems to be supported in this case by a number of concrete
reasons why public policy could be served through further investigation.
Analogies of common law pleading should not be allowed to obscure
the fact that the Commission was intended by Congress to function, not
only for the protection of investors in the particular instance, but also
for the protection of the public at large. Such a general policy, however,
cannot justify the violation of a constitutional protection, so that the
question becomes whether the letter or spirit of any constitutional safe-
guard was violated by the Commission's action.
As the dissent points out, the majority does not refer to any article
or section of the Constitution; the order of the District Court did not
involve any search or seizure of papers or effects, or production of any
books and documents. The holdings in the cases referred to in the
108 On the correlation of the duties of the Commissioner and the Attornev
General, see Securities and Exchange Comm. v. Robert Collier & Co., 76 F. (2d)
939 (C. C. A. 2d, 1935), and testimony of Counsel of the Commission before House
of Representatives therein quoted.
majority opinion are, it is submitted, not controlling. In Ellis v. Inter-

state Commerce Commission,109 the questions objected to were put to
an officer of a company which was not subject to regulation by the Com-
mission, until it was shown that it was being used by another company
as a device to obtain concessions, and the order of the Court was passed
without prejudice to such a possibility. Re Pacific R. Commission110
and Kilboutrn v. Thompson1"' involve investigations where the Govern-
ment was not acting for a governmental purpose but for the collection
of debts owed to it. In Harriman v. Interstate Commerce CoMMissionl12
it was held only that the Commission, in making an investigation, was
confined to the investigation of matters that could have been the subject
of a complaint to it; and in Federal Trade Commission v. American
Tobacco Co.,113 it was held that the Commission was meant by the Act to
have access only to such records as might be evidence in a matter en-
trusted to it. Entick v. Carrington114 and Boyd v. United States115 are
made inapplicable by Section 22(c) of the Securities Act, which pro-
vides that a witness, if he claims that the testimony required of him may
tend to incriminate him or expose him to penalty or forfeiture, may, if
he testifies, not be prosecuted thereafter for any matter thus revealed.
As the minority opinion in the Jones case says, a warning of the
dangers that wait upon the abuse of power by officialdom can never be
untimely, but there are dangers also to the public in the restrictions
which the Court places upon the Commission's action. The right of in-
vestigation is one of the most valuable instruments of an administrative
tribunal in fulfilling the purposes of its creation. Although that right
should and must be curtailed if it involves the abrogation of constitu-
tional guarantees, it is submitted that the Commission's refusal to permit
a registrant, by his own act, to stultify an investigation of his own pro-
ceedings, does not encroach upon any constitutional immunity. The
"denunciatory fervor" of the majority may be linked with their treat-
ment of the case according to analogies of court procedure. In civil
courts, when the issue between the two parties disappears, the case goes
with it. The functioning of a quasi-judicial tribunal imports a new
element. Courts of civil law are accustomed to put public interest in
the scales in judging the contentions of the individual parties, but they
are not accustomed to the three-dimensional aspect which, in adminis-
109 237 U. S. 434, 445 (1915).

11032 Fed. 241, 250 (1887).
111 103 U. S. 168 (1881 ).
112 211 U. S. 407, 419 (1908).
113264 U. 5. 298 (1924).
11419 How. St. Tr. 1029, 1074 (1765).
115 116 U. S. 616, 629, 630 (1886).
trative proceedings, that element introduces. Recognition of the neces-

sity of administrative tribunals is easier to reconcile with legal habits of
mind than acceptance of the methods of their functioning. In so far
as safeguards are concerned, it would seem that one of the greatest safe-
guards against officialdom is insistence that its consideration of the pub-
lic interest should be unflagging.
VII
The case of Morgan v. United States'16 arose under the Packers
and Stockyard Act.117 Under that Act, the Secretary of Agriculture,
if, after a "full hearing," he is of the opinion that rates, charges or
practices in connection with the furnishing of stockyard services are or
will be unjust, unreasonable or discriminating, may determine and pre-
scribe reasonable ones. His findings of fact, if within the authority of
the Act, and if no constitutional question is involved, are conclusive.'18
The proceeding here was instituted by the Secretary on his own initi-
ative for the fixing of maximum rates, and resulted in affirmative ac-
tion. Fifty concerns brought suits to restrain the enforcement of the
order. The District Court, on motion of the Government, struck out
from the original bills allegations, among others, that, after the con-
clusion of the hearings before the examiner, the Secretary refused to
hear oral arguments himself, and attempted to delegate Acting Secre-
taries to hear the arguments, that the Secretary, at the time he signed
the order, had not personally heard or read any of the evidence pre-
sented at the hearing or heard or considered any arguments or briefs, but
acted only upon information he derived from consultation with em-
ployees of the Department.
The Court unanimously decided that the District Court erred in
striking out these allegations. The Chief Justice, who delivered the
opinion, found that the procedure, in the cases presented to the Court,
violated the statutory requirements for a "full hearing." While the
case is one of statutory construction, there are constitutional overtones
in the opinion. The Court said it was not necessary to go beyond the
terms of the statute to consider the constitutional requirement of due
process as to notice and hearing, and referred to the sort of hearing
"which is required by the principles established by our decisions." The
requirements for such a hearing, the opinion reiterates, are not technical.
Evidence may be taken by an examiner and analyzed by subordinates.
11 56 Sup. Ct. 906 (1936), discussed in (1936) 36 COLUMBIA LAW REV. 1156.
11742 STAT. 159 (1921), 7 U. S. C. ?? 181-229 (1934).
11 Tagg Bros. & Moorhead v. United States, 280 U. S. 420 (1930) ; Acker v.
United States, 56 Sup. Ct. 824 (1936).
Arguments may be oral or written. "But there must be a hearing in a

substantial sense."
The Court, as in the Panama Refining case, looked through the
form of the action contemplated by the statute, and found that it was
not executive, but quasi-legislative and quasi-judicial. The fixing of
rates of market agencies is legislative in nature, but the proceeding pre-
liminary to the making of the order "has a quality resembling that of a
judicial proceeding." The Court did not pass upon the question of
subdelegation of power which could have been presented if the Assistant
Secretary had found the facts and made the order, but said that the
Assistant Secretary, who heard the argument, assumed no responsibility
for the findings or order, and the Secretary, who had not heard, did as-
sume that responsibility. "The officer who makes the determinations
must consider and appraise the evidence which justifies them." The
duty is not impersonal; the "one who decides must hear."
The Morgan case will be contrasted with one of the leading de-
cisions in English administrative law, Local Government Board v.
Arlidge.119 The Housing and Town Planning Act of 1909120 required
the local authority to make a closing order as to any dwelling house if
it appeared unfit for human habitation. Right of appeal was given to
the Local Government Board, under a procedure to be fixed by the
Board. Arlidge appealed to the Board, which, after a public local in-
quiry held by one of its inspectors, decided against him. He then sought
to have the Board's order quashed, one of his principal contentions being
that he had not been heard by the Board or by the person deciding the
appeal. The House of Lords upheld the Board. Viscount Haldane
said, "The Minister at the head of the Board . . . is expected to obtain
his materials vicariously through his officials, and he has discharged his
duty if he sees that they obtain these materials for him properly. When,
therefore, the Board is directed to dispose of an appeal, that does not
mean that any particular official of the Board is to dispose of it." Lord
Shaw said that when the statute did not prescribe the means of deciding
an appeal, the board "must still act honestly and by honest means. ...
But that the judiciary should presume to impose its own methods on
administrative or executive officers is a usurpation." Lord Moulton was
of the opinion that the Board only "must preserve a judicial temper
and perform its duties conscientiously."
The Supreme Court, in the Morgan case, dismissed the Arlidge
case as relating to "a different sort of administrative action" and "not
1"I [1915] A. C. 120, rev'g, Rex v. Local Government Board [1914] 1 K. B. 160.
See Jennings, Courts and Admintistrative Law (1936) 49 HARV. L. REV. 426, 439
et sea.
12D9 EDW. VII, c. 44 (1910).
pertinent to a proceeding under the statute before us." Yet the hearing
under the Packers and Stockyard Act was, the Court held, judicial in
nature, just as the House of Lords found that the appeal under the
Housing and Town Planning Act was judicial in nature. There may be
a legal potency in the adjective "full" which the Packers Act prefixes
to "hearing," and it is to be noted that the Packers Act provided for a
determination by the Secretary, while the English Act called for a de-
termination by the Board.
While there is no principle of administrative law that the procedure
in the various boards and commissions must be the same, the rule which
the Court announces for the first time in the Morgan case,12' goes to the
fundamentals of the hearing which is necessary in any sort of adminis-
trative proceeding not purely executive. If the person who acts must
be the person who hears, if he cannot rely upon reports of others but
must, in some form, review the evidence and arguments himself, there
will have to be a sharp break from some departmental practices.'22
Comparison will inevitably be made between the refusal of the
House of Lords in the Arlidge case to interfere with administrative
practice, however different from the lawyers' idea of judicial procedure,
and the action of the Supreme Court in the Morgan case. The practical
question, however, is how much the latter decision will hamper the op-
eration of administrative work. From the standpoint of justice to the
individual, the principle set forth by the Supreme Court undoubtedly
is a salutary safeguard.
121 Hannibal Bridge Co. v. United States, 221 U. S. 194 (1911) involved a
criminal prosecution for failure to comply with an order of the Secretary of
War under a statute which gave the Secretary the right to order alterations to
bridges over navigable water, and made failure to comply a misdemeanor. The
Secretary was given the right to pass the order when he had "good reason to be-
lieve" the bridge was an unreasonable obstruction, but could act only after "first
giving the parties reasonable opportunity to be heard." In this case, the first hear-
ing had been before an officer of the Engineer Corps. Later, the bridge company
requested a hearing before the Secretary of War himself. The Secretary con-
sented to the hearing, but said that it must be held before the Judge Advocate
General of the Army. The latter officer heard the case and reported to the Secre-
tary that the action of the War Department should be adhered to. The official
notice to the Bridge Company to make the alterations was signed by an Assistant
Secretary of War. It was held that the statute had been substantially complied
with, and the judgment of conviction was affirmed.
122 Deportations, for example, are on warrants of the Secretary of Labor. "Be-
cause of the vast increase in deportation cases, it became utterly impossible for the
Secretary or even one of his assistants to read so many records, much less digest
and decide upon them. The practical result is that the decision rests in the hands
of the extra-legal advisory board of review, for the assistant to the Secretary
usually accepts the recommendation of the Board." CLARK, DEPORTATION OF ALIENS
(1931) 380. While deportation is not a criminal process, aliens in this country are,
on deportation proceedings, entitled to a fair though summary hearing under the
Fifth Amendment. Yick Wo. v. Hopkins, 118 U. S. 356 (1886) * Zakonaite v.
WVolf, 226 U. S. 272 (1912); Bilokumsky v. Tod, 263 U. S. 149 (1923) ; Mahler
v. Eby, 264 U. S. 32 (1924); The Japanese Immigrant Case, 189 U. S. 86 (1903);
Kwock Jan Fat v. White, 253 U. S. 454, 464 (1920).
In this connection, the fact that the authority to act was delegated
to a Board in the Arlidge case, and to a Secretary in the Morgan case,
may represent a fundamental difference. Boards and Commissions are
equipped to hear as well as to decide. Delegation to a Secretary of
quasi-legislative and quasi-judicial duties, which must necessarily be
carried out largely by subordinates, is in part a survival of the early
stages of administrative law. Within a department, as the Supreme
Court has recognized, the process of administrative machinery in quasi-
judicial work should function in the same general way as in those boards
and commissions which are created as independent agencies. In de-
partments, however, the evolutionary process tends to be restricted by
the fact that the functional operations must be mainly performed by
bodies or groups which are not independent of executive authority. The
National Commission on Law Observance and Enforcement, of which
Mr. Wickersham was Chairman, called attention to this in 1931 in its
report on the enforcement of the deportation laws, and urged that the
non-statutory and extra-legal Board of Review, which had been created
in the Department of Labor, should be made an independent tribunal.123
In England, in 1932, the Committee on Ministers' Powers recommended
assignment to a Ministerial Tribunal rather than to a Minister in some
quasi-judicial matters, as well as in some administrative problems when
there exists a clear judicial side.124
There can be no universal mold for the organizations which carry
on quasi-legislative or quasi-judicial functions; the nature of the policy
to be carried out, the difficulties of enforcement, the economic condi-
tions, the persons or industries affected, and all other germane factors
bearing on the particular problem are to be considered in each case. In
all probability, certain kinds of this work can be better carried out by
departments than by independent boards. In other fields of administra-
tive law, however, the reverse may well be true, and it is submitted that
the Morgan decision, instead of interfering with the development of
administrative machinery, may have a wholesome practical effect in
accelerating the process of dichotomy.
VIII
The importance of St. Joseph Stock Yards Co. v. United States'25
does not lie in the actual decision, which unanimously affirms an order
of the Secretary of Agriculture, under the Packers and Stockyard Act.,
1 REP. No. 5. NATIONAL COMMISSION ON LAW OBSERVANCE AND ENFORCEMENT,
DEPORTATION LAWS (1931) 157-167, 178, 179. There is also involved the general
desirability of separating the functions of investigating and prosecuting from the
functions of decision.
'1Z REPORT, supra note 20, ? III.
125298 U.S. 38 (1936).
fixing maximum rates for services rendered by a stockyards company,

but in the re-examination of the scope of judicial review in administra-
tive law when a constitutional question is raised. Mr. Chief Justice
Hughes delivered the Court's opinion and reaffirmed the doctrine that,
even though a legislature attempts to give a quasi-legislative agency the
right to make its findings of fact conclusive, and even though there is a
fair hearing and some evidence to support the findings, if there is a ques-
tion of deprivation of property without due process of law or the taking
of private property for public use without just compensation, the Court
will exercise its independent judgment upon the facts. This judgment
may be informed and aided by the "sifting procedure of an expert legis-
lative agency," and there is a "strong presumption in favor of the con-
clusions" reached by the administrative body, but the judicial scrutiny
must take into account the entire administrative processes, including the
reasoning and findings. Mr. Justice Roberts concurred in the result.
Mr. Justice Brandeis, agreeing that the judgment should be affirmed,
delivered a powerful dissenting opinion on the point of judicial review,
which Mr. Justice Stone and Mr. Justice Cardozo thought stated the
law as it ought to be.
The Chief Justice rests the doctrine on the reasoning that the ac-
tion of a legislature in fixing rates must be examined by the courts to
determine if there has been confiscation or deprivation of property with-
out due process, and that the legislature therefore cannot escape the
constitutional limitation by authority to an agent. He does not, in this
opinion, refer to the fact, which he emphasizes in the Morgan case, that
the processes of an administrative rate-making body are judicial as well
as legislative in nature. The motivating cause of the Court's reaffirm-
ance, on a fresh examination, of the doctrine of the Ben Avon case,126 is
to be found, it is submitted, in the following quotation:
"Legislative agencies, with varying qualifications, work in a field peculiarly

exposed to political demands. Some may be expert and impartial, others sub-
servient. It is not difficult for them to observe the requirements of law in
giving a hearing and receiving evidence. But to say that their findings of
fact may be made conclusive where constitutional rights of liberty and prop-
erty are involved, although the evidence clearly establishes that the findings
are wrong and constitutional rights have been invaded, is to place those rights
at the mercy of administrative officials and seriously to impair the security in-
herent in our judicial safeguards. That prospect, with our multiplication of
administrative agencies, is not one to be lightly regarded."
The opinion of Mr. Justice Brandeis on this point is a masterful

consideration of the position of the courts in judicial review of the work
"253 U. S. 287 (1920).
of administrative agencies. He points out that a finding of fact by a

jury of inexperienced laymen, if supported by substantial evidence, may
be conclusive, within the Constitution, and fails to find anything therein
calling for a different result when the findings of fact are made "by a
highly trained and especially qualified administrative agency." He refers
to the Court's own decisions that due process is not necessarily judicial
process, and that "due process does not require that a decision made by
an appropriate tribunal shall be reviewable by another." He points to
the finality which the Court has allowed to determinations of value by
agencies other than juries, as in condemnation proceedings, income taxes,
tariff valuations, fire insurance losses, and ad valorem taxation. The
distinction is emphasized between action by a legislative and by a quasi-
judicial administrative body, which must function under all the safe-
guards Congress and the Court have imposed. Congress has concluded
that the giving of finality to the findings of the Secretary of Agriculture
is essential to the effective administration of the Act, and the history
of this case127 as well as that of other rate cases which have come before
the Court, shows that regulation cannot be effective unless the legality
of the rates prescribed may, if contested, be determined with reasonable
promptness. The heavy task of reviewing questions of fact may impair
the quality of the work of the courts, and the taking away of ultimate
responsibility for the findings of fact may emasculate the rate-making
bodies.
Against this cogent and realistic reasoning stands the fear of the
Court that some administrative bodies may have insufficient qualifica-
tions or be exposed to political demands. Such risks, however, are in-
herent in our democracy, in whose processes the work of administrative
boards has come to be as essential a part as the work of our courts.
Judges themselves, as Mr. Justice Brandeis points out, may have neither
the time nor the qualifications independently to determine the correctness
of the complicated questions of fact involved in rate-making, nor does
the judicial process, however free from political influence, work in a
vacuum of which there is no trace of social or economic views. Judicial
determination of fact is not the only way to curb possible excesses of
administrative tribunals; informed criticism, insistence upon the training
of expert public servants, the democratic control of the legislature which
creates the agency, could be relied upon to relieve the courts of a re-
sponsibility for which they are not equipped, particularly when the as-
127 "Six and one half years have elapsed since the Secretary of Agriculture coln-
cluded that the rates of this utility were so high as to justify inquiry into their
reasonableness, and nearly two years since entry of his order prescribing the re-
duced rates." 298 U. S. at 84.
sumption of the responsibility tends to stu

governmental functions.
In his opinion in the St. Joseph Stock Yards Company case, Mr.
Justice Brandeis refers to a distinction which he believes exists between
the constitutional rights of liberty of person and constitutional property
rights. Courts should review administrative determinations of facts, in
his opinion, in matters of personal rights even though he believes they
should apply a more liberal rule when dealing with rights of property.
The Chief Justice is of the opinion that the same principle applies when
"rights either of person or of property are protected by constitutional
restrictions." Obviously, therefore, the safeguards which the Court
has developed in connection with the work of administrative tribunals
apply at least as much to personal as to property rights. Law and
actuality, however, may differ.
The enforcement of the deportation laws may be taken as an ex-
ample of quasi-judicial administrative proceedings which affect personal
rights almost exclusively. Deportation is the exercise of a sovereign
right, and a vigorous enforcement of the deportation laws is necessary
both to carry out our immigration policy and to rid the country of un-
desirable aliens unlawfully here. On the other hand, deportation, while
not a criminal process, may result in the loss "of all that makes life
worth living."'128 Thousands of aliens are expelled every year, through
administrative processes in the Department of Labor ;129 thousands more
of people, many of them American citizens, are directly or indirectly
affected. The Supreme Court has passed a number of times upon
phases of the procedure with respect to aliens. Indeed, the high-water
mark of its self-restraint in refusing to review findings of fact in an
administrative proceeding was its holding that the claim of an alien,
upon applying for re-admission to this country after a temporary de-
parture, that he was a native-born American citizen, could be conclu-
sively determined by the Secretary of Labor, and that, in the absence
of abuse of authority, there would be no court review.130 It has been
held by the Court, however, that aliens, in deportation proceedings, are
entitled to a fair though summary hearing, under the due process of law
clause of the Fifth Amendment.'3'
l-"Ng Fung Ho v. White, 259 U. S. 276, 284 (1922). See also Kwock Jan
Fat v. White, 253 U. S. 454, 464 (1920).
'" The average number of aliens deported during the last five years is in excess
of 14.000 a year. REP. SEC'Y LAROR (1935) 90.
United States v. Ju Toy, 198 U. S. 253 (1905). Cf. Ng. Fung Ho v. White,
259 U. S. 276, 284 (1922). The Ju Toy case, and the case of United States ex ret.
Milwaukee Publishing Co. v. Burleson, 255 U. S. 417 (1921) may be considered
in connection with the St. Joseph Stockyards Co. case.
'"' See cases cited supra note 122.
Despite the announcement of this constitutional protection of per-

sonal rights, the National Commission of Law Obervance and Enforce-
ment found that:
" (a) The apprehension and examination of supposed aliens are often
characterized by methods unconstitutional, tyrannic, and oppressive.
(b) There is strong reason to believe that in many cases persons are de-
ported when further development of the facts or proper construction of the
law would have shown their right to remain.
(c) Many persons are permanently separated from their American families
with results that violate the plainest dictates of humanity...."'
In April 1933, the Commissioner General of Immigration caused

an investigation to be instituted, the findings and results of which he
commented upon in a recent report to the House of Representatives, as
follows:
"When in April 1933 the investigations which led to these proposals were
instituted, the deportation law and the methods employed in its enforcement
had earned the censure of the courts, the pulpit, the press, and the public.
A record number of deportations was the chief objective and the measure
of efficiency. Arrests without warrant in violation of law were not the
exception but the rule. Illegal raids on peaceful assemblages and forceful
detention of those present, alien and citizen alike, were of frequent occurrence.
Third-degree methods were employed. Aliens were held in jail for many
months awaiting completion of their trial. Bonds were set in unjustifiable
amounts. In the enforcement of a law designed primarily to rid the country
of the undesirable alien no effort was made to search out criminals for de-
portation. Only 8Y2 percent of all deportations were those of criminals. The
noncriminal was treated with a severity unparalleled in the history of American
law enforcement. No attention was paid to the separation of families or to the
hardships on those left behind, even though they were for the most part
citizens of the United States.
Such of these abuses as could be corrected administratively have been
corrected. Arrests without warrant, illegal detentions, and third-degree
methods have been ended. Bail has been set at a sufficient but not unrea-
sonable figure. Unnecessary detention has been stopped, with a saving of
more than $150,000 per annum to the Government."'M
The Report of the Commission adopting the conclusions quoted in the text,
among others, was signed by George W. Wickersham, Chairman, Newton D.
Baker, Ada L. Comstock, William I. Grubb, William S. Kenyon, Monte M.
Lemann, Frank J. Loesch, Paul J. McCormick and Roscoe Pound. Mr. Henry W.
Anderson and Mr. Kenneth Mackintosh dissented, in whole or in part. See also
Lawless Enforcement of the Law, REPORT OF SUB-COMMITTEE OF CONSTITUTIONAL
RIGHTS COMMITTEE OF THE Los ANGELES BAR ASSOCIATION ON ALLEGED LAW EN-
FORCEMENT IN CONNECTION WITH THE DEPORTATION OF ALIENS (1931) ; CLARK,
DEPORTATION OF ALIENS (1931) ; and VAN VLECK, THE ADMINISTRATIVE CONTROL
OF ALIENS (1932).
"33H. R. Doc. No. 392, 74th Cong., 2d Sess. (1936) 2, 3.
Consideration of the significance of this state paper, and of recent

developments in the deportation process, must be reserved for subsequent
discussion. Comment here is confined to three points. First, there is,
or has been, a striking contrast between the lack of regard, in actual
practice, for the personal rights involved in deportation proceedings, and
the zealous protection, in actual practice, of the property rights involved
in rate-making proceedings. Second, that difference has been caused,
in large part, by an element beyond the control of the courts. Where
property rights are involved, lawyers are generally present to protect
them; in deportation cases, although the criminal alien is often repre-
sented, "in the great majority of cases, suspects have no one at any stage
of the proceeding to protect their rights."134 Third, such changes as
are taking place in the deportation procedure have largely been prompted,
not by court proceedings, but by independent investigations, public zeal
for liberty, and the action of public servants within the Department.
Ix
The recent decisions of the Supreme Court in administrative law

show that the quasi-judicial or quasi-legislative administrative tribunal
has been recognized and approved as a permanent instrument of govern-
ment. The Court has rendered incalculable service to the causes of
liberty and good government in fixing the general mold which these tri-
bunals must take, and in which their processes must be carried out. With
respect to their actual functioning, however, the decisions give ground
for the belief that the Court, faced with concrete instances of departure
from legal procedure, has been over-zealous in its interference with
administrative processes. These processes, while giving weight to the
rights of the individual, are directed towards a justice in which the pub-
lic interest is largely involved. They are still in the course of develop-
ment; constant public scrutiny and interest, steady adherence by the
134 REP. No. 5, NATIONAL COMMISSION ON LAW OBSERVANCE AND ENFORCE-

MENT, DEPORTATION LAWS (1931) 83-86, 143. In an address to the Federal Bar
Association in 1931 (U. S. Daily, February 14, 1931), Mr. Chief Justice Hughes,
after stating that "the distinctive development of our era (is) that the activities of
the people are largely controlled by Government bureaus in State and Nation,"
added:
"In this new dispensation the service of the lawyer becomes more than ever
indispensable. In the early days it was the fearless lawyer, standing in the
dignity and authority of his profession, unabashed and determined, before
tyrannical judges prone to abuse judicial prerogatives, who vindicated essential
liberties and secured for us our happy tradition both of judicial independence
and judicial responsibility. So to-day, it is to the well trained, learned, and
experienced members of the bar justifying the trust reposed in them, and repre-
senting their clients with honorable zeal, that the individuals of the community
must continue to look for protection against every encroachment upon in-
dividual rights."
tribunals to the principles of justice, the services of the bar, independent

studies of the actual proceedings and their results, emphasis upon the
development of trained and able administrators, may, it is hoped, be
counted upon to make the Court less apt to assume responsibilities with
which it should not be burdened.
REUBEN OPPENHEIMER
BALTIMORE, MD.

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The Supreme Court and Administrative Law

Author(s): Reuben Oppenheimer

THE SUPREME COURT AND ADMINISTRATIVE

The nine Justices of the Supreme Court are in agreement upon

Schechter v. United States, 295 U. S. 495, 529, 530 (1935).

to mean the fairness of an old age pension or unemployment insurance

8E.g., public utility commissions, workmen's compensation boards, the Fed

often oblique. A Federal board is created by act of Congress. The

The historical background in matters of administrative law is, in

sweeping and blended authority found in modern administrative bodies,

18 See supra note 17.

of them at the same time."24 Jefferson, himself, reaffirmed the prin-

24 Art. III, ? 39; see THE FEDERALIST (1818) No. XLVIII.

from Legislative usurpations than from any other source."33 James

3' DOCUMENTS, supra note 26, at 425.

1 STAT. 372 (1794).

Marshall's dictum in Wayman v. Southard marked a considerable

192 U. S. 470 (1904).

There is another essential of the modern commission-the power

to the valid establishment, in other economic fields, of such adminis-

no question of the codes under the National Industrial Recovery Act.

Mr. Justice Cardozo, in his dissent, said:

"There must be sensible approximation, there must be elasticity of adjustment,

upon the happening of a fixed, ascertainable event, such as the instances

See supra notes 38-41.

created under other Acts of Congress, and as it did in the Schechter

8 Schechter v. United States, 295 U. S. 495, 530 (1935).

The case came to the Supreme Court on writs of certiorari to the

of the initiators of the new laws, monopolies, discriminations against

8" See Note (1935) 48 HARV. L. REV. 798, 804.

dividual chickens from particular coops. The legislation with respect

the absolute negation it presents on the question of interstate com-

ation come the significant words "for it is not even delegation to an

He concludes this portion of the opinion by pointing out that:

along together on either the policies or the administering of the Federal

38 STAT. 717 (1914), 15 U. S. C. ?? 41, 42 (1934).

service-a body which shall be independent of Executive authority,

96 (1935) 35 COLUMBIA LAW REV. 936.

9298 U.S. 1(1936).

In the Jones case, the petitioner had filed a registration statement

could be affected by the withdrawal of the application. Mr. Justice

majority opinion are, it is submitted, not controlling. In Ellis v. Inter-

109 237 U. S. 434, 445 (1915).

trative proceedings, that element introduces. Recognition of the neces-

Arguments may be oral or written. "But there must be a hearing in a

fixing maximum rates for services rendered by a stockyards company,

"Legislative agencies, with varying qualifications, work in a field peculiarly

The opinion of Mr. Justice Brandeis on this point is a masterful

"253 U. S. 287 (1920).

of administrative agencies. He points out that a finding of fact by a

sumption of the responsibility tends to stu

Despite the announcement of this constitutional protection of per-

In April 1933, the Commissioner General of Immigration caused

Consideration of the significance of this state paper, and of recent

The recent decisions of the Supreme Court in administrative law

134 REP. No. 5, NATIONAL COMMISSION ON LAW OBSERVANCE AND ENFORCE-

tribunals to the principles of justice, the services of the bar, independent

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