1. The Taft Amendment to the Emergency Price Control Act
nullified price schedules based on standards, and no such schedules
could be valid after that Amendment unless and until the Price
Administrator "determined" that no other method of price control
was practicable. P. 328 U. S.
2. Sales of wastepaper between July 16, 1943, the effective date
of the Taft Amendment, and September 11, 1943, the date when the
Price Administrator determined that other than, by standardization,
no method of effective price control of such commodity was
practicable, did not subject the sellers to the penalties of the
Emergency Price Control Act, even though such sales were at prices
in excess of a pre-Taft Amendment maximum price based on a
standard. Pp. 328 U. S. 51
328 U. S.
3. The accommodation of the various interests involved in a
system of price control is for Congress, not the courts, and the
legislation is to be so construed as to give effect to the will of
Congress. P. 328 U. S.
151 F.2d 345 reversed.
No. 578. By leave of the District Court in which a prosecution
of the petitioners for violation of a regulation under the
Emergency Price Control Act was pending, petitioners sought in the
Emergency Court of Appeals a declaration of the invalidity of the
regulation. The Emergency Court of Appeals sustained the validity
of the regulation. 151 F.2d 345. This Court granted certiorari. 326
U.S. 715. Reversed,
p. 328 U. S.
No. 67. Petitioners filed a protest with the Price Administrator
under the Emergency Price Control Act. The Price Administrator
denied the protest. The Emergency
Page 328 U. S. 51
Court of Appeals sustained the Price Administrator. 148 F.2d
831. This Court granted certiorari. 325 U.S. 847. Writ of
certiorari dismissed, p. 328 U. S.
MR. JUSTICE FRANKFURTER delivered the opinion of the Court.
Having been charged with violations of a price regulation,
petitioners challenged its validity before the Emergency Court of
Appeals by two different modes in two separate actions. The claim
of invalidity in both proceedings was based on the Taft Amendment
to the Price Control Act. Adjudication of this claim will dispose
of both cases without consideration of procedural issues raised
before the Emergency Court.
Thomas Paper Stock Company, a dealer in paper scrap, and its
president were indicted under § 205(b) of the Emergency Price
Control Act, 56 Stat. 23, 33, 50 U.S.C. App. § 925(b), for the sale
of wastepaper in violation of Maximum Price Regulation No. 30, 7
Fed.Reg. 9732 (Nov. 24, 1942). Section 1347.14(d) of that
regulation fixed the maximum price for unsorted wastepaper in terms
of a specification or standard. Id.
at 9735. On similar
allegations, the Administrator later began an action against
petitioners for treble damages. § 205(e), 56 Stat. 23, 34, 50
U.S.C. App. § 925(e). Both proceedings involved sales of wastepaper
between July 16, 1943, and September
Page 328 U. S. 52
11, 1943. The dates are crucial. July 16, 1943, is the effective
date of the Taft Amendment, the proper construction of which is the
controlling issue. On September 11, 1943, the Administrator, by an
amendment to the Maximum Price Regulation No. 30, "determined" that
"no practicable alternative exists for securing effective price
control" with respect to such wastepaper except through the
standardization defined in the pre-Taft Amendment Maximum Price
Regulation No. 30. 8 Fed.Reg. 12554 (Sept. 14, 1943). The problem
before us is whether, after the Taft Amendment, sales of wastepaper
were governed by a maximum price based on a standard, prior to the
determination by the Administrator on September 11, 1943, that
there was no practicable alternative to such standardization.
And so we turn to the Taft Amendment. It added subsection (j) to
§ 2 of the Emergency Price Control Act. The relevant provisions of
the Taft Amendment are these:
"(j) Nothing in this Act shall be construed . . . (3) as
authorizing the Administrator to standardize any commodity, unless
the Administrator shall determine, with respect to such
standardization, that no practicable alternative exists for
securing effective price control with respect to such commodity; or
(4) as authorizing any order of the Administrator fixing maximum
prices for different kinds, classes, or types of a commodity which
are described in terms of specifications or standards, unless such
specifications or standards were, prior to such order, in general
use in the trade or industry affected, or have previously been
promulgated and their use lawfully required by another Government
57 Stat. 566, 50 U.S.C. App. § 902(j).
We agree with the Emergency Court that Congress thus
"three alternative situations in any one of which
Page 328 U. S. 53
[the Administrator] is authorized to employ specifications or
standards in connection with price control."
Thomas Paper Stock Co. v. Bowles,
148 F.2d 831, 835.
Thus, in the case of wastepaper, standardization is permitted under
Clause (3) of the Amendment, although the Administrator may define
a standard which "had not previously been used by the wastepaper
industry or required by another Government agency." Id.
837. But we are also of opinion that, beginning with July 16, 1943,
the day the Taft Amendment came into force, it precluded
standardized commodity prices unless and until the Administrator
"determined" that no other method of price control was practicable.
The terms of the Amendment, in the circumstances of its setting,
H.R.Rep. No.697, 78th Cong., 1st Sess (1943),
bring us to this conclusion, but we need add little to the full
discussion the Taft Amendment received in the opinion of the court
and that of the dissent below. Thomas Paper Stock Co. v.
151 F.2d 345. For us, the decisive consideration is
that the Amendment was a rigorous limitation upon the powers of the
Administrator based upon the Congressional view that
standardizations outstanding at the time the Taft Amendment was
passed had not been authorized by the more general language of the
original Act. § 2(h), 56 Stat. 23, 27, 50 U.S.C. App. § 902(h).
Congress laid down a specific requirement for the validity of
prices based on standards, and a fair reading of the Amendment in
the light of its history requires that the Administrator must
indicate that he has fulfilled this requirement. See United
States v. Baltimore & O. R. Co., 293 U.
. It would hardly satisfy the restriction which
the Taft Amendment
Page 328 U. S. 54
placed upon the Administrator's power to standardize to allow
him to continue situations which, as Congress thought, needed
In signing the joint resolution containing the Taft Amendment,
the President did so with the understanding that it
"preserved the power in the Administrator to 'standardize' a
commodity in any case on which this was absolutely essential to an
effective system of fixing prices."
Statement of Price Administrator's Reasons Involved
in the Issuance of Supplementary Order No. 64 (Sept. 11, 1943).
Congress thus gave power to standardize; it did not stereotype past
standardizations. With entire candor, the Administrator conceded
here that he "had many regulations outstanding which required
reexamination in the light of the terms of the Taft Amendment."
But, although the Amendment apparently had the acquiescence of the
Administrator, it contains no saving clause that all outstanding
standardizing regulations were to be deemed continuingly valid, nor
is there any intimation warranting such an implied limitation. The
court below seemed to recognize the duty of a manifested
determination by the Administrator of the need for a standardized
price by suggesting that the Administrator showed "reasonable
promptness" in making the determination applicable to wastepaper
within two months after the Taft Amendment. But Congress did not
sanction standardization for what we may deem a reasonable period
after the enactment of the Taft Amendment without the
Administrator's determination of its need.
This is too substantial a qualification to be made by judicial
interpolation. Nor can we draw on broad arguments about
inflationary pressures on price control in construing legislation
dealing with so technically confining a provision as that of the
Taft Amendment. The legislation was too specifically directed
against prior unauthorized
Page 328 U. S. 55
regulations, promulgated no doubt with the best of motives in
the great effort against inflation, for us to give it a meaning
other than that which the language in the context of its history
yields. Of course, all provisions of the Emergency Control Act are
infused by its far-reaching aims. But the accommodation of the
various interests involved in a system of price control are for
Congress, and not for us, and we must construe its legislation as
fairly as we can to catch the will behind the words. That the
construction we have placed upon the Taft Amendment does not touch
the vital forces in price control is indicated by the Government's
opposition to a review of this litigation on the ground that it was
devoid of much practical significance.
It only remains to unsnarl the complicated procedures by which
the petitioners sought to establish the invalidity of the
regulation which they were charged with violating. On June 15,
1944, petitioners filed a protest against § 1347.14(d) under §
203(a) of the Act. 56 Stat. 23, 31, 58 Stat. 632, 638, 50 U.S.C.
App. § 923(a). By this time, as has been noted, the Administrator
had amended the regulation to conform in terms with the Taft
Amendment. The Administrator denied the protest on the merits, and
also expressed doubt as to his power to consider the validity of a
regulation of which the alleged defects had been cured. The
Emergency Court of Appeals sustained the Administrator on the
ground that a corrected regulation bars protest. Thomas Paper
Stock Co. v. Bowles,
148 F.2d 831. We then brought the case
here as one of a series of cases raising important issues in the
enforcement of the Emergency Price Control Act. 325 U.S. 847.
In the meantime, petitioners invoked § 204(e) of the Act, 58
Stat. 632, 639, 50 U.S.C. App. § 924(e), whereby they sought leave
to file a complaint directly with the
Page 328 U. S. 56
Emergency Court. The District Court before which the criminal
prosecution was pending granted such leave pursuant to § 204(e).
The Emergency Court then passed on the merits of the claim of the
invalidity of the regulation in controversy between the date of the
Taft Amendment and September 11, 1943, when, in Supp.Order 64, 8
Fed.Reg. 12554, the Administrator determined the necessity for
standards. That court, as we have seen, held that the old
regulation survived the Taft Amendment. Thomas Paper Stock Co.
151 F.2d 345, and we granted certiorari. 326 U.S.
It is this latter judgment, in No. 578, that we now reverse,
with the result that disregard of the regulation based on
standardized prices for wastepaper not "determined" by the
Administrator prior to September 11, 1943, does not subject
petitioners to the penalties of the Price Control Act. In view of
disposition in No. 578 of the merits of petitioner's claim of
invalidity under the Taft Amendment, it would be futile to decide
the issue on which judgment went in No. 67. Accordingly, the writ
of certiorari issued in No. 67 will be dismissed.
MR. JUSTICE JACKSON took no part in the consideration or
decision of these cases.
"The powers granted in this section shall not be used or made to
operate to compel changes in the business practices, cost practices
or methods, or means or aids to distribution established in any
industry except to prevent circumvention or evasion of any
regulation, order, price schedule, or requirement under this
MR. JUSTICE BLACK, dissenting.
The judgment which the Court just rendered permits this
appellant and others to keep profits obtained from sales made at
inflationary prices expressly prohibited by Maximum Price
Regulation No. 30. That Regulation establishes dollar and cent
ceiling prices for thirty-two grades of wastepaper defined by the
Price Administrator. It is the type of regulation, of which there
have been many, which controls prices by first standardizing or
grouping similar commodities and then fixing one and
Page 328 U. S. 57
the same maximum price for each of the commodities in a
particular classification. On July 16, 1943, long after Regulation
No. 30 was promulgated and fully in force, Congress added the Taft
Amendment, (Section 2(j)) to the Emergency Price Control Act of
1942. The Court holds that Congress intended by this amendment to
invalidate automatically Price Regulation No. 30, and all the
numerous regulations like it, until such time as the Price
Administrator should find it possible, amidst all his pressing
duties, to investigate and make determinations, formally expressed
in writing, that only by standardizing or grouping certain
commodities could price control over them be successfully enforced.
Since the task of rechecking all past regulations which contained
standardization provisions was very great, the Administrator did
not find time to reach the Regulation here involved until two
months after the Amendment's enactment. The Court holds that,
during this interval, the public had no protection whatever from
inflationary prices prohibited by this Regulation. In my opinion,
this holding finds support neither in the Section's language nor
its legislative history.
When the sponsor of the Taft Amendment offered it on the Senate
floor, his statement clearly indicated that it grew out of
cooperative effort between the legislators and the Price
Administrator, who certainly would not be interested in throwing a
monkey-wrench into OPA's enforcement of the existing regulations.
Referring to provisions of the Act which his Amendment was intended
to clarify, Senator Taft said:
"Price Administrator Brown came before the committee and urged
that it would seriously hamper his price regulations is a number of
trades, regulations for which had already been issued, to many of
which there was no objection. He submitted another
Page 328 U. S. 58
form of amendment, carrying out the same purpose, but making it
perfectly clear that it would not interfere with those regulations,
which are proper."
Cong.Rec. July 6, 1943, Vol. 89, p. 7251.
In spite of this clear declaration on the part of Senator Taft
of his intention to save "proper" existing regulations, the Court
now gives the Taft Price Administrator Amendment a meaning which
does "interfere with those regulations." It not only interferes
with them, it completely destroys their effectiveness for an
indefinite interval of time. These appellants and others are wholly
freed from any possible penalty for deliberate inflationary
overcharges, forbidden by Congress, during the period between the
passage of the Amendment and the Administrator's publication of his
determinations. That the Regulation here involved was a "proper"
regulation on the day the Taft Amendment was passed is conceded.
That its standardization provisions were at all times necessary to
the effective enforcement of the Act is shown both by the
Administrator's later findings and by his original promulgation.
Consequently, it is this Court, and not the Congress, which must
take the responsibility for permitting appellants to violate the
price regulation with impunity.
Furthermore, the Taft Amendment's language offers no support for
the Court's decision. For, by its terms, it neither repeals nor
renders unenforceable or ineffective valid outstanding regulations
which standardize commodities. And, in addition to what has already
been pointed out, the prevailing circumstances at the time of its
enactment make it highly improbable that Congress intended such a
result. At the time the Amendment was enacted the threat of
inflation was the greatest since the outbreak of the war. Just in
April, the President had thought it necessary to issue his well
known "Hold-the-Line Order"
Page 328 U. S. 59
in order to tighten controls designed to stem the inflationary
trend. Purchasing power was very great, and consumer goods had
become extremely scarce. Had Congress really intended to protect
the public against inflation, as its legislation shows it did, it
would not have chosen this time for relaxing government controls.
The giving of free reign to inflationary pressure was likely to
endanger seriously our economy, and to bring great hardship to many
individuals. I cannot, without a clear declaration to that effect
with respect to any part of our economy, impute to Congress an
intent to let inflation run riot during such critical times. I
cannot conclude, therefore, as the opinion of the Court necessarily
does, that Congress intended to suspend all Maximum Price
Regulations containing standardization provisions until the Price
Administrator reviewed them.
What then was the purpose of Congress in enacting the Taft
Amendment? The Managers on the part of the House thus stated the
Section's purpose in the Conference Report on the Amendment: it
"is to meet the objection that the Price Administrator has
exceeded the limitations expressed
in section 2(h) of . .
. (the 1942 Price Control Act). . . in issuing certain regulations
(Italics supplied.) Section 2(h) provides:
"The powers granted . . . shall not be used or made to operate
to compel changes in the business practices, cost practices or
methods, or means or aids to distribution, established in any
industry, except to prevent circumvention or evasion of any
regulation, order, price schedule, or requirement under this
(Italics supplied.) As the Conference Report indicates, the Taft
Amendment actually added little new, if anything at all, to the
requirements already contained in Section 2(h). It was merely an
explanation and elaboration of one phase of the requirements of
Page 328 U. S. 60
Any regulation, including the one here held invalid, that was
promulgated when Section 2(h) was in effect had to meet its
requirements. As later explained by the Taft Amendment, the
requirements of 2(h) which permitted the Administrator to require
changed business practices to prevent "circumvention or evasion"
included, in the case of regulations containing new standardization
provisions, a determination that there was no practical alternative
to effective price control. All standardization provisions,
including the one here held invalid, in order to be valid under the
old Section 2(h), had to be based on such a determination. The Taft
Amendment was not, as the Court now holds, a declaration by
Congress that all past standardization provisions had not been
based on such a determination, and that they were therefore
invalid. Here, the Regulation in question was promulgated while
Section 2(h) was in full force and effect. Not only did petitioners
fail to show that the Regulation was not based on the determination
required by 2(h) as explained by the Taft Amendment, but the
Administrator, after the Amendment was enacted, and before any
proceedings were brought against petitioners, double-checked the
Regulation to make sure that it was based on the determination
required. It is not denied, and apparently cannot be denied, that
it was absolutely necessary for the Administrator to order these
changed standardization practices in order to prevent circumvention
or evasion. In my opinion, therefore, the wastepaper provisions of
Maximum Price Regulation No. 30 were valid at all times, since they
met the requirements of Section 2(h) as explained by 2(j). I would
affirm the judgment below, which dismissed the complaint.
MR. JUSTICE DOUGLAS and MR. JUSTICE MURPHY join in this