This suit was brought by petitioner, a Foreign Service Officer,
to test the validity of his discharge by the Secretary of State
under these circumstances: the State Department's Loyalty Security
Board had repeatedly cleared petitioner of charges of being
disloyal and a security risk, and its findings had been approved by
the Deputy Under Secretary, whose approval of findings favorable to
an employee were final under the applicable Regulations. No finding
unfavorable to petitioner ever had been made by the Department's
Loyalty Security Board or the Deputy Under Secretary, and no
recommendation unfavorable to petitioner ever had been made by the
Deputy Under Secretary to the Secretary. Nevertheless, the Loyalty
Review Board of the Civil Service Commission, on its own motion,
conducted its own hearing, found that there was reasonable doubt as
to petitioner's loyalty, and advised the Secretary that petitioner
"should be forthwith removed from the rolls of the Department of
State." Acting solely on the basis of the finding of that Board,
and without making any independent determination of his own on the
record in the case, the Secretary discharged petitioner on the same
day. He based this action on Executive Orders No. 9835 and No.
10241 and § 103 of Public Law 188, 82d Congress, commonly known as
the McCarran Rider, which authorized the Secretary, "in his
absolute discretion," to
"terminate the employment of any officer . . . of the Foreign
Service . . . whenever he shall deem such termination necessary or
advisable in the interests of the United States."
Held: petitioner's discharge was invalid because it
violated Regulations of the Department of State which were binding
on the Secretary, and the judgment is reversed. Pp.
354 U. S.
365-389.
1. The Regulations of the State Department governing this
subject were applicable to discharges under the McCarran Rider, as
well as to those effected under the Loyalty-Security Program. Pp.
354 U. S.
373-381.
Page 354 U. S. 364
(a) The terms of the Regulations, the fact that the Department
itself proceeded in this very case under those Regulations down to
the point of petitioner's discharge, representations made by the
State Department to Congress relating to its practices under the
McCarran Rider, and the announced wish of the President to the
effect that authority under the McCarran Rider should be exercised
subject to procedural safeguards designed to protect "the personal
liberties of employees" all combine to support this conclusion. Pp.
354 U. S.
373-379.
(b) The Secretary was not powerless to bind himself by these
Regulations as to discharges under the McCarran Rider. Pp.
354 U. S.
379-380.
(c) A different result is not required by the fact that the
Regulations refer explicitly to discharges based on loyalty and
security grounds, and make no reference to discharges deemed
"necessary or advisable in the interests of the United States,"
which is the sole standard of the McCarran Rider. Pp.
354 U. S.
380-381.
2. The manner in which petitioner was discharged was
inconsistent with, and violative of, Regulations of the State
Department -- regardless of whether the 1949 Regulations or the
1951 Regulations be considered applicable. Pp.
354 U. S.
382-388.
(a) Under the 1949 Regulations, the Secretary had no right to
dismiss petitioner for loyalty or security reasons unless and until
the Deputy Under Secretary, acting upon findings of the
Department's Loyalty Security Board, had recommended dismissal. Pp.
354 U. S.
383-387.
(b) Under § 393.1 of the 1951 Regulations, a decision in such a
case could be reached only "after consideration of the complete
file, arguments, briefs, and testimony presented," and the record
shows that the Secretary made no attempt to comply with this
requirement in this case. Pp.
354 U. S.
387-388.
3. Since the Secretary did not comply with the applicable
Regulations of his Department, which were binding on him,
petitioner's dismissal cannot stand.
Accardi v.
Shaughnessy, 347 U. S. 260. Pp.
354 U. S.
388-389.
98 U.S.App.D.C. 268, 235 F.2d 215, reversed and remanded.
Page 354 U. S. 365
MR. JUSTICE HARLAN delivered the opinion of the Court.
On December 14, 1951, petitioner, John S. Service, was
discharged by the then Secretary of State, Dean Acheson, from his
employment as a Foreign Service Officer in the Foreign Service of
the United States. This case brings before us the validity of that
discharge.
At the time of his discharge in 1951, Service had been a Foreign
Service Officer for some sixteen years, during ten of which,
1935-1945, he had served in various capacities in China. In April,
1945, shortly after his return to this country, Service became
involved in the so-called Amerasia investigation through having
furnished to one Jaffe, the editor of the Amerasia magazine, copies
of certain of his Foreign Service reports. Two months later,
Service, Jaffe, and others were arrested and charged with violating
the Espionage Act, [
Footnote 1]
but the grand jury, in August, 1945, refused to indict Service. He
was thereupon restored to active duty in the Foreign Service, from
which he had been on leave of absence since his arrest, and
returned to duty in the Far East.
From then on, Service's loyalty and standing as a security risk
were under recurrent investigation and review by a number of
governmental agencies under the provisions of Executive Order No.
9835, [
Footnote 2] establishing
the President's Loyalty Program, and otherwise. He was accorded
successive "clearances" by the State Department
Page 354 U. S. 366
in each of the years 1945, 1946, and 1947, [
Footnote 3] and a fourth clearance in 1949 by that
Department's Loyalty Security Board, which, however, was directed
by the Loyalty Review Board of the Civil Service Commission, when
the case was examined by it on "post-audit," [
Footnote 4] to prefer charges against Service and
conduct a hearing thereon. This was done, and, on October 6, 1950,
after extensive hearings, the Department Board concluded that
"reasonable grounds do not exist for belief that . . . Service is
disloyal to the Government of the United States . . . ," and that "
. . . he does not constitute a security risk to the Department of
State." These findings were approved by the Deputy Under Secretary
of State, acting pursuant to authority delegated to him by the
Secretary. [
Footnote 5] Again,
however, the Loyalty Review Board, on post-audit, remanded the case
to the Department Board for further consideration. [
Footnote 6] Such consideration was had, this
time under the more stringent loyalty standard established by
Executive Order No. 10241, [
Footnote 7] amending the earlier Executive Order No. 9835,
and again the Department Board, on July 31, 1951, decided favorably
to Service. This determination was likewise approved by the Deputy
Under Secretary. However, on a further post-audit, the Loyalty
Review Board decided to conduct a new hearing itself, which
resulted this time in the Board's finding that there was a
reasonable doubt as to Service's loyalty, and
Page 354 U. S. 367
in its advising the Secretary of State, on December 13, 1951,
that, in the Board's opinion, Service "should be forthwith removed
from the rolls of the Department of State," and that "the Secretary
should approve and adopt the proceedings" had before the Board.
[
Footnote 8] On the same
Page 354 U. S. 368
day, the Department notified Service of his discharge, effective
at the close of business on the following day.
The authority and basis upon which the Secretary acted in
discharging petitioner are set forth in an affidavit later filed by
Mr. Acheson in the present litigation, in which he states:
"2. On December 13, 1951, I received a letter from the Chairman
of the Loyalty Review Board of the Civil Service Commission
submitting to me that Board's opinion, dated December 12, 1951, in
the case of John S. Service, a Foreign Service officer of the
Department of State and the plaintiff in this action."
"3. On that same day, I considered what action should be taken
in the light of the opinion of the Loyalty Review Board,
recognizing that whatever action taken would be of utmost
importance to the administration of the Government Employees
Loyalty Program. I understood that the responsibility was vested in
me to make the necessary determination under both Executive Order
No. 9835, as
Page 354 U. S. 369
amended, and under Section 103 of Public Law 188, 82d Congress,
as to what action to take."
"4. Acting in the exercise of the authority vested in me as
Secretary of State by Executive Order 9835, as amended by Executive
Order 10241, and also by Section 103 of Public Law 188, 82d
Congress (65 Stat. 575, 581), I made a determination to terminate
the services of Mr. Service as a Foreign Service Officer in the
Foreign Service of the United States."
"5. I made that determination solely as the result of the
finding of the Loyalty Review Board and as a result of my review of
the opinion of that Board. In making this determination, I did not
read the testimony taken in the proceedings in Mr. Service's case
before the Loyalty Review Board of the Civil Service Commission. I
did not make any independent determination of my own as to whether,
on the evidence submitted before those boards, there was reasonable
doubt as to Mr. Service's loyalty. I made no independent judgment
on the record in this case. There was nothing in the opinion of the
Loyalty Review Board which would make it incompatible with the
exercise of my responsibilities as Secretary of State to act on it.
I deemed it appropriate and advisable to act on the basis of the
finding and opinion of the Loyalty Review Board. In determining to
terminate the employment of Mr. Service, I did not consider that I
was legally bound or required by the opinion of the Loyalty Review
Board to take such action. On the contrary, I considered that the
opinion of the Loyalty Review Board was merely an advisory
recommendation to me, and that I was legally free to exercise my
own judgment as to whether Mr. Service's employment should be
terminated, and I did so exercise that judgment. "
Page 354 U. S. 370
Section 103 of Public Law 188, 82d Congress, [
Footnote 9] upon which the Secretary thus
relied, was the so-called McCarran Rider, first enacted as a rider
to the Appropriation Act for 1947, which provided:
"Notwithstanding the provisions of . . . any other law, the
Secretary of State may, in his absolute discretion, . . . terminate
the employment of any officer or employee of the Department of
State or of the Foreign Service of the United States whenever he
shall deem such termination necessary or advisable in the interests
of the United States. . . . [
Footnote 10]"
Similar provisions were reenacted in each subsequent
appropriation act until 1953. [
Footnote 11]
After an attempt to secure further administrative review of his
discharge proved unsuccessful, petitioner brought this action, in
which he sought a declaratory judgment that his discharge was
invalid; an order directing the respondents to expunge from their
records all written statements reflecting that his employment had
been terminated because there was a reasonable doubt as to his
loyalty; and an order directing the Secretary to reinstate him to
his employment and former grade in the Foreign Service, with full
restoration of property rights and payment of accumulated
salary.
While cross-motions for summary judgment were pending before the
District Court, this Court rendered its decision in
Peters v.
Hobby, 349 U. S. 331,
holding that, under Executive Order No. 9835, the Loyalty Review
Board had no authority to review, on post-audit, determinations
favorable to employees made by department or agency
Page 354 U. S. 371
authorities, or to adjudicate individual cases on its own
motion. On the authority of that decision, the District Court
declared the finding and opinion of the Loyalty Review Board
respecting Service to be a nullity, and directed the Civil Service
Commission to expunge from its records the Board's finding that
there was reasonable doubt as to his loyalty. But since
petitioner's removal rested not only upon Executive Order No. 9835,
as amended, but also upon the McCarran Rider, the District Court
sustained petitioner's discharge as a valid exercise of the
"absolute discretion" conferred upon the Secretary by the latter
provision, and granted summary judgment in favor of respondents in
all other respects. [
Footnote
12] The Court of Appeals affirmed, 98 U.S.App.D.C. 268, 235
F.2d
Page 354 U. S. 372
215, and this Court granted certiorari, 352 U.S. 905, because of
the importance of the questions involved to federal administrators
and employees alike.
Petitioner here attacks the validity of the termination of his
employment on two separate grounds: first, he contends that the
Secretary's exercise of discretion was invalid since the findings
and opinion of the Loyalty Review Board, upon which alone the
Secretary acted, were void because they were rendered without
jurisdiction [
Footnote 13]
and were based upon procedures assertedly contrary to due process
of law. Even conceding that the Secretary's powers under the
McCarran Rider were such that he was not required to state the
grounds for his decision, petitioner urges, his decision cannot
stand, because he did, in fact, rely upon grounds that are invalid.
See Securities and Exchange Commission v. Chenery Corp.,
318 U. S. 80;
Perkins v. Elg, 307 U. S. 325.
Second, petitioner contends that the Secretary's action is subject
to attack under the principles established by this Court's decision
in
Accardi v. Shaughnessy, 347 U.
S. 260, namely, that regulations validly prescribed by a
government administrator are binding upon him as well as the
citizen, and that this principle holds even when the administrative
action under review is discretionary in nature. Regulations
relating to "loyalty and security of employees" which had been
promulgated by the Secretary, petitioner asserts, were intended to
govern discharges effected under the McCarran Rider as well as
those effected under Executive Order No. 9835, as amended, and
because those regulations were violated by the Secretary in this
case, so petitioner claims, his dismissal by the Secretary cannot
stand. Since, for reasons discussed hereafter, we have concluded
that petitioner's second contention must be sustained, we do not
reach the first.
Page 354 U. S. 373
The questions to which we address ourselves therefore are as
follows: (1) were the departmental Regulations here involved
applicable to discharges effected under the McCarran Rider? and (2)
were those Regulations violated in this instance? We do not
understand the respondents to dispute that the principle of
Accardi v. Shaughnessy, supra, is controlling if we find
that the Regulations were indeed applicable and were violated. We
might also add that we are not here concerned in any wise with the
merits of the Secretary's action in terminating the petitioner's
employment.
I
We think it is not open to serious question that the
departmental Regulations upon which petitioner relies were
applicable to McCarran Rider discharges as well as to those
effected pursuant to the Loyalty-Security program. The terms of the
Regulations, the fact that the Department itself proceeded in this
very case under those Regulations down to the point of petitioner's
discharge, representations made by the State Department to Congress
relating to its practices under the McCarran Rider, and the
announced wish of the President to the effect that McCarran Rider
authority should be exercised subject to procedural safeguards
designed to protect "the personal liberties of employees," all
combine to lead to that conclusion. We also think it clear that
these Regulations were valid so far as their validity is put in
issue by the respondents in this case.
A.
The Regulations.
When the Department's proceedings against the petitioner, which
resulted in the "clearances" of October 6, 1950, and July 31, 1951,
were begun, the Regulations in effect were those of March 11, 1949,
entitled "Regulations and Procedures relating to Loyalty and
Security of
Page 354 U. S. 374
Employees, U.S. Department of State." [
Footnote 14] Section 391 stated the "Authority and
General Policy" of the Regulations in three subsections. Subsection
391.1 stated that it was
"highly important to the interests of the United States that no
person be employed in the Department who is disloyal or who
constitutes a security risk."
Subsection 391.2 stated that, so far as the Regulations related
to the handling of loyalty cases, they were promulgated in
accordance with Executive Order No. 9835, which had recognized the
"necessity for removing disloyal employees from the Federal service
and for refusing employment therein to disloyal persons," and the
"obligation to protect employees and applicants from unfounded
accusations of disloyalty." Subsection 391.3 referred to the
language of the McCarran Rider, noting that the Secretary of State
had been granted by Congress the right, in his absolute
discretion,
"to terminate the employment of any officer or employee of the
Department of State or of the Foreign Service of the United States
whenever he shall deem such termination necessary or advisable in
the interests of the United States."
"In the exercise of this right," the subsection concluded, "the
Department will, so far as possible, [
Footnote 15] afford its employees the same protection as
those provided under the Loyalty Program." And, as we shall see
hereafter, the Regulations made no provision for action by the
Page 354 U. S. 375
Secretary himself, under the McCarran Rider or otherwise, except
following unfavorable action in the employee's case by the
Department Loyalty Security Board, after full hearing before that
Board on the charges against him, and approval of the Board's
action by the Deputy Under Secretary. [
Footnote 16]
In May and September, 1951, prior to the time of petitioner's
discharge, the Regulations were revised, and the amended § 391
provided even more explicitly than the original that the procedures
and standards established were intended to govern exercise of the
authority granted by the McCarran Rider. After stating in the first
subsection [
Footnote 17]
that the Regulations were adopted to implement the Department's
policy that "no person be employed in the Department [
Footnote 18] who is disloyal or who
constitutes a security risk," the section continues in the next two
subsections [
Footnote 19] to
state in effect that the Regulations relating to the handling of
loyalty cases were promulgated in accordance with
Executive Order No. 9835, and that those relating to
security cases were promulgated under
Page 354 U. S. 376
the authority of the Act of August 26, 1950 [
Footnote 20] and the McCarran Rider.
[
Footnote 21] The phrase "so
far as possible," in reference to McCarran Rider authority, was
deleted. The Regulations thus drew upon all the sources of
authority available to the Secretary with reference to such cases,
and purported to set forth definitively the procedures and
standards to be followed in their handling.
B.
The Administrative Proceedings in this Case.
The administrative proceedings held in petitioner's case were
unquestionably conducted on the premise that the Regulations were
applicable in this instance. The charges were based on the
Regulations, and a copy of the Regulations was sent to Service
along with the letter of charges. The hearing was scheduled under §
395 of the 1949 Regulations. In its opinion exonerating Service,
the Department Board noted, following the Regulations, that "the
issues here are (1) loyalty, and (2) security risk." The Board's
favorable recommendations came twice before the Deputy Under
Secretary for review under §§ 395.6 and 396.7 of these Regulations,
and were approved by him. Later, before the Civil Service
Commission's Loyalty Review Board, an additional charge was added
to the Department's original charges by stipulation of the parties,
and the stipulation expressly referred to §§ 392.2 and 393.1a of
the Regulations. Indeed at no time during any of the administrative
proceedings
Page 354 U. S. 377
in this case was there any suggestion that the Regulations were
not applicable to the entire proceedings and binding upon all
parties to the case.
C.
The Department's Representations to Congress.
In the spring of 1950, the Department of State submitted to an
investigating subcommittee of the Senate Foreign Relations
Committee a comprehensive report on the procedures and standards
used by the Department in dealing with employee loyalty and
security problems. After describing the procedures utilized by the
Department in the early post-war period, the report continued as
follows:
". . . The policy of the Department prior to the passage of the
McCarran rider was that, if there was reasonable doubt as to an
employee's loyalty, his employment was required to be terminated.
The McCarran rider freed the hands of the Department in making this
policy effective. Basically, any reasonable doubt of an employee's
loyalty, if based on substantial evidence, was to be resolved in
favor of the Government. After enactment of the McCarran rider, the
Department did not contemplate that the legislation required, or
that the people of this country would countenance, the use of
'Gestapo' methods or harassment or persecution of loyal employees
who were American citizens on flimsy evidence or hearsay and
innuendo. The Department proceeded to develop appropriate
procedures designed to implement fully and properly the authority
granted the Department under the McCarran rider."
"The McCarran rider . . . was the first of a series of
provisions included in each subsequent appropriation act which
authorized the Secretary of State, in his absolute discretion,
to"
"terminate the employment
Page 354 U. S. 378
of any officer or employee of the Department of State or of the
Foreign Service of the United States whenever he shall deem such
termination necessary or advisable in the interests of the United
States."
"Accordingly, effective during the 1947 fiscal year and each
fiscal year thereafter, the Department considered the McCarran
rider as an additional standard for dealing with security problems
in the Department. . . .
In [its] considered view, the McCarran
rider was subject to procedural limitations. The McCarran
rider was not interpreted as permitting reckless discharge or the
exercise of arbitrary whims."
"
* * * *"
"The President's loyalty order of March 21, 1947, prescribed a
comprehensive set of standards governing the executive branch as a
whole. It was deemed applicable to the Department of State, as well
as to other agencies.
The unique powers conferred on the
Department as a result of continuous reenactment of the McCarran
rider led the Department to promulgate regulations which would
encompass its duties and powers both under the Executive order and
under the McCarran rider. [
Footnote 22]"
D.
The President's Letter.
That the policy of the Secretary to subject his plenary powers
under the McCarran Rider to procedural limitations was deliberately
adopted, and rested on decisions taken at the highest level, is
evidenced by a letter dated September 6, 1950, from President
Truman to the Secretary of State, which was made a part of the
record below. In that letter, the President advised the Secretary
that he had just approved H.R. 7786, the General Appropriation Act,
1951, 69 Stat. 595, 768, § 1213 of
Page 354 U. S. 379
which reenacted the McCarran Rider for the current fiscal year.
The President continued:
"I am sure you will agree that, in exercising the discretion
conferred upon you by Section 1213, every effort should be made to
protect the national security without unduly jeopardizing the
personal liberties of the employees within your jurisdiction.
Procedures designed to accomplish these two objectives are set
forth in Public Law 733, 81st Congress, which authorizes the
summary suspension of civilian officers and employees of various
departments and agencies of the Government, including the
Department of State."
"In order that officers and employees of the Department of State
may be afforded the same protection as that afforded by Public Law
733, it is my desire that you follow the procedures set forth in
that law in carrying out the provisions of section 1213 of the
General Appropriations Act."
In view of the terms of the Regulations, the course of procedure
followed by the Department, and the background materials we have
noted, we think that there is no room for doubt that the
departmental Regulations for the handling of loyalty and security
cases were both intended and considered by the Department to apply
in this instance. We cannot accept either of the respondents'
present arguments to the contrary. The first argument, as put by
the District Court, whose language was adopted by the Court of
Appeals, [
Footnote 23]
is:
". . . It was not the intent of Congress that the Secretary of
State bind himself to follow the provisions of Executive Order 9835
in dismissing employees under Public Law 188. This power of summary
dismissal would not have been granted the
Page 354 U. S. 380
Secretary of State by the Congress if the Congress was satisfied
that the interests of this country were adequately protected by
Executive Order 9835."
We gather from this that the lower courts though that the
Secretary was powerless to bind himself by these Regulations as to
McCarran Rider discharges based on loyalty or security grounds. We
do not think this is so. Although Congress was advised in
unmistakable terms that the Secretary had seen fit to limit by
regulations the discretion conferred upon him,
see pp.
354 U. S.
377-378,
supra, it continued to reenact the
McCarran Rider without change for several succeeding years.
[
Footnote 24]
Cf. Labor
Board v. Gullett Gin Co., 340 U. S. 361,
340 U. S. 366;
Fleming v. Mohawk Wrecking Co., 331 U.
S. 111,
331 U. S. 116.
Nor do we see any inconsistency between this statute and the effect
of the Regulations upon the Secretary under
Accardi v.
Shaughnessy, 347 U. S. 260,
already discussed, pp.
354 U. S.
372-373,
supra. Accardi, indeed,
involved statutory authority as broad as that involved here.
[
Footnote 25]
The respondents' second argument is that the Regulations refer
explicitly to discharges based on loyalty and security grounds, but
make no reference to discharges
Page 354 U. S. 381
deemed "necessary or advisable in the interests of the United
States" -- the sole McCarran Rider standard -- and hence were not
applicable to such discharges. But, as has already been
demonstrated, both the Regulations and their historical context
show that the Regulations were applicable to McCarran Rider
discharges at least to the extent that they were based on loyalty
or security grounds, and we do not see how it could seriously be
considered, as the respondents now seem to urge, that Service was
not discharged on such grounds. The Secretary's affidavit,
[
Footnote 26] and also the
Department's formal notice to Service of his discharge, [
Footnote 27] both of which, among
other things, refer to Executive Order No. 9835 as well as to the
McCarran Rider as authority for the Secretary's action,
unmistakably show that the discharge was based on such grounds.
Page 354 U. S. 382
We now turn to the question whether the manner of petitioner's
discharge was consistent with the Department's Regulations.
II
Preliminarily, it must be noted that the parties are in dispute
as to which of the two sets of Regulations -- those of 1949 or
those of 1951 -- is applicable to petitioner's case, assuming, as
we have held, that one or the other must govern. The departmental
proceedings against petitioner were begun and were conducted under
the 1949 Regulations. However, prior to petitioner's discharge in
December, 1951, the revised Regulations of May and September, 1951,
had become effective, and it is under those Regulations, the
respondents say, that Service's discharge must be judged. [
Footnote 28] On the other hand, the
petitioner contends that the 1949 Regulations remained applicable
to his case, since he was not advised of the existence of the 1951
Regulations until after his discharge had been accomplished and the
present court proceedings had been commenced. [
Footnote 29] However, it is unnecessary for us
to make a choice between the two sets of Regulations, for we find
the manner in which petitioner was discharged to have been
inconsistent with both.
Page 354 U. S. 383
A.
The 1949 Regulations.
In terms of the 1949 Regulations, the vice we find in
petitioner's discharge is that the Secretary had no right to
dismiss the petitioner for loyalty or security reasons unless and
until the Deputy Under Secretary, acting upon the findings of the
Department's Loyalty Security Board, had recommended such
dismissal. In other words, the Deputy Under Secretary in this
instance having approved the findings of the Loyalty Security Board
favorable to petitioner, the Secretary, consistently with these
Regulations, could not, without more, dismiss the petitioner.
The basis for this conclusion will appear from a consideration
of the procedural scheme established by the 1949 Regulations
relating to loyalty and security cases. In outline, that scheme
involved the following procedural steps:
"(1) The filing of charges, upon notice to the employee
involved, accompanied by adequate factual details as to their
basis, and a statement as to the employee's work and pay status
pending further action. [
Footnote 30]"
"(2) A hearing on such charges, if requested by the employee,
before the Department's Loyalty Security Board, whose
determination, together with the record of the hearings, were then
to be forwarded to the Deputy Under Secretary for review. [
Footnote 31]"
"(3) Upon such review, the Deputy Under Secretary was empowered
(i) to return the case to the Board for further investigation or
action; (ii) to decide in favor of the employee, and to so notify
him
Page 354 U. S. 384
in writing; or (iii) to decide against the employee, and to
notify him of his right to appeal to the Secretary within 10 days
thereafter. [
Footnote
32]"
"(4) In the event of such an appeal, the Secretary was empowered
(i) to decide favorably to the employee, and to so notify him in
writing; or (ii) to decided against the employee, and to notify him
of such decision, and further, in a loyalty case, of his right to
appeal to the Loyalty Review Board within 20 days thereafter.
[
Footnote 33]"
"(5) If, upon such an appeal, the Loyalty Review Board decided
adversely to the employee and made an 'advisory' recommendation to
the Secretary that the employee should be removed from employment
under the applicable loyalty standards, the Department was to take
prompt administrative action to that end. On the other hand, if the
Board decided favorably to the employee, the Secretary was
empowered (i) to restore the employee to duty and 'close the case';
(ii) to permit the employee to resign; or (iii) to terminate his
employment under the authority conferred by the McCarran Rider 'or
other appropriate authority.' [
Footnote 34]"
From this survey, three things appear as to the handling of
loyalty and security cases under the 1949 Regulations which are of
significance in this case.
First, following the decision
of the Deputy Under Secretary upon a determination of the
Department Loyalty Security Board, there was to be an appeal to the
Secretary
only if the Deputy's action had been adverse to
the employee. In other words, under these Regulations, the action
of the
Page 354 U. S. 385
Deputy Under Secretary, if
favorable to the employee,
was to be final, the Secretary reserving to himself power to act
further only if his Deputy's action was unfavorable to the
employee. [
Footnote 35]
Second, there was likewise an appeal to the Loyalty Review
Board from the Secretary's decision
only if his action was
adverse to the employee. Again, in other words, a decision
of the Secretary favorable to the employee was to be final, and
immune from further action by the Loyalty Review Board on
post-audit, a rule since confirmed by our decision in
Peters v.
Hobby, supra. Third, the Secretary reserved the right
to deal with such a case under his McCarran Rider authority,
outside the Regulations, only in instances where, upon an
employee's appeal to the Loyalty Review Board from an unfavorable
decision by the Secretary, the decision of that body was favorable
to the employee.
Granted, as the respondents argue, that these Regulations gave
the petitioner (a) no right of appeal to the Secretary from the
Deputy Under Secretary's
favorable
Page 354 U. S. 386
decision, and (b) no right of appeal at all from the action of
the Loyalty Review Board, it does not follow, as the respondents
then argue, that the Secretary was free to dismiss the petitioner.
For, as has already been observed, the Regulations left the
Secretary
functus officio with respect to such cases once
the Deputy Under Secretary had made a determination favorable to
the employee. So here, when the Deputy Under Secretary approved the
Loyalty Security Board's action of July 31, 1951, clearing the
petitioner, under these Regulations, the case against Service was
closed. [
Footnote 36] Hence,
Service's subsequent discharge by the Secretary must be deemed to
have been in contravention of these 1949 Regulations. [
Footnote 37] The situation under the
1949 Regulations was thus closely analogous to that which obtained
in
Accardi v. Shaughnessy, supra. There, the Attorney
General bound himself not to exercise his discretion until he had
received an impartial recommendation from a subordinate board.
Here, the
Page 354 U. S. 387
Secretary bound himself not to act at all in cases such as this,
except upon appeal by employees from determinations unfavorable to
them. We see no relevant ground for distinction.
B.
The 1951 Regulations.
A similar conclusion must be reached if the 1951 Regulations are
deemed applicable to petitioner's case. Section 393.1 of those
Regulations provides:
"The standard for removal from employment in the Department of
State under the authority referred to in section 391.3 shall be
that on all the evidence reasonable grounds exist for belief that
the removal of the officer or employee involved is necessary or
advisable in the interest of national security.
The decision
shall be reached after consideration of the complete file,
arguments, briefs, and testimony presented."
(Emphasis added.) The "authority referred to in section 391.3,"
as we have already noted, included the McCarran Rider. [
Footnote 38] In light of the former
Secretary's affidavit, [
Footnote
39] there is no room for dispute that no attempt was made to
comply with this section of the Regulations, [
Footnote 40] as indeed the respondents' brief
virtually concedes.
The respondents argue that this provision was not violated in
petitioner's case, because
"the only decision to which Section 393.1 relates is that the
removal of the
Page 354 U. S. 388
officer or employee involved is 'necessary or advisable in the
interest of national security,'"
the standard laid down in the Act of August 26, 1950, [
Footnote 41] and that
"[n]othing in this section purports to prescribe the procedure
to be followed in determining that removal is 'necessary or
advisable in the interests of the United States,'"
the standard contained in the McCarran Rider. But since § 391.3,
which is incorporated by reference into § 393.1, specifically
subjected the exercise of the Secretary's McCarran Rider authority,
in such cases as this, to the operation of the 1951 Regulations, it
seems clear that the necessary effect of §393.1 was to subject the
exercise of that authority to the substantive standards prescribed
by that section, namely, those established by the Act of August 26,
1950, [
Footnote 42] and also
to the procedural requirements that such cases must be decided "on
all the evidence" and "after consideration of the complete file,
arguments, briefs, and testimony presented." The essential meaning
of the section, in other words, was that the Secretary's decision
was required to be on the merits. While it is, of course, true
that, under the McCarran Rider, the Secretary was not obligated to
impose upon himself these more rigorous substantive and procedural
standards, neither was he prohibited from doing so, as we have
already held, and, having done so, he could not, so long as the
Regulations remained unchanged, proceed without regard to them.
It being clear that § 393.1 was not complied with by the
Secretary in this instance, it follows that, under the
Accardi doctrine, petitioner's dismissal cannot stand,
Page 354 U. S. 389
regardless of whether the 1951, rather than the 1949,
Regulations are deemed applicable in his case. [
Footnote 43]
For the foregoing reasons, the judgment of the Court of Appeals
must be reversed, and the case remanded to the District Court for
further proceedings consistent with this opinion.
It is so ordered.
MR. JUSTICE CLARK took no part in the consideration or decision
of this case.
[
Footnote 1]
Act of June 15, 1917, c. 30, 40 Stat. 217, as amended.
[
Footnote 2]
12 Fed.Reg. 1935.
[
Footnote 3]
Hearings before the Subcommittee of the House Committee on
Appropriations on the Department of State Appropriation Bill for
1950, 81st Cong., 1st Sess. 298.
[
Footnote 4]
See Peters v. Hobby, 349 U. S. 331,
349 U. S.
339-348, for a discussion of the then-existing
"post-audit" procedure.
[
Footnote 5]
See pp.
354 U. S.
382-386 and
note
16 infra.
[
Footnote 6]
This action was based on "supplementary information . . .
received from the Federal Bureau of Investigation," the nature of
which does not appear in the record.
[
Footnote 7]
16 Fed.Reg. 3690.
[
Footnote 8]
The essence of the Loyalty Review Board's action, and its
relation to the prior departmental proceedings with respect to
Service, are summarized in the State Department's press release of
December 13, 1951, as follows:
"The Department of State announced today that the Loyalty Review
Board of the Civil Service Commission has advised the Department
that this Board has found a reasonable doubt as to the loyalty of
John Stewart Service, Foreign Service Officer."
"Today's decision of the Loyalty Review Board is based on the
evidence which was considered by the Department's Board and found
to be insufficient on which to base a finding of 'reasonable doubt'
as to Mr. Service's loyalty or security. Copies of the Opinions of
both Boards are attached."
"The Department of State's Loyalty Security Board, on July 31,
1951, had reaffirmed its earlier findings that Service was neither
disloyal nor a security risk, and the case had been referred to the
Loyalty Review Board for post-audit on September 4, 1951. The
Loyalty Review Board assumed jurisdiction of Mr. Service's case on
October 9, 1951."
"The Chairman of the Loyalty Review Board in today's letter to
the Secretary (full text attached) noted:"
" The Loyalty Review Board found no evidence of membership in
the Communist Party or in any organization on the Attorney
General's list on the part of John Stewart Service. The Loyalty
Review Board did find that there is a reasonable doubt as to the
loyalty of the employee, John Stewart Service, to the Government of
the United States, based on the intentional and unauthorized
disclosure of documents and information of a confidential and
nonpublic character within the meaning of subparagraph d of
paragraph 2 of Part V, 'Standards,' of Executive Order No. 9835, as
amended."
"The Opinion of the Loyalty Review Board stressed the points
made above by the Chairman -- that is, it stated that the Board was
not required to find, and did not find, Mr. Service guilty of
disloyalty, but it did find that his intentional and unauthorized
disclosure of confidential documents raised reasonable doubt as to
his loyalty. The State Department Board while censoring
[
sic] Mr. Service for indiscretions, believed that the
experience Mr. Service had been through as a result of his
indiscretions in 1945 had served to make him far more than normally
security conscious. It found also that no reasonable doubt existed
as to his loyalty to the Government of the United States. On this
point, the State Department Board was reversed."
"The Chairman of the Loyalty Review Board has requested the
Secretary of State to advise the Board of the effective date of the
separation of Mr. Service. This request stems from the provisions
of Executive Orders 9835 and 10241 -- which established the
President's Loyalty Program -- and the Regulations promulgated
thereon. These Regulations are binding on the Department of
State."
"The Department has advised the Chairman of the Loyalty Review
Board that Mr. Service's employment has been terminated."
[
Footnote 9]
65 Stat. 581.
[
Footnote 10]
60 Stat. 458.
[
Footnote 11]
See 61 Stat. 288, 62 Stat. 315, 63 Stat. 456, 64 Stat.
768, 65 Stat. 581, 66 Stat. 555. All of these provisions are
referred to in this opinion as "the McCarran Rider."
[
Footnote 12]
The District Court's opinion is unreported. Actually, the
Secretary could be considered to have power to discharge petitioner
as he did only by virtue of the McCarran Rider. Petitioner was an
officer in the Foreign Service of the United States, and, as such,
was entitled to the protection of the Foreign Service Act of 1946,
as amended. 22 U.S.C. § 801
et seq. That statute
authorizes the Secretary of State to separate officers from the
Foreign Service "for unsatisfactory performance of duty,"
id., § 1007, or for "misconduct or malfeasance,"
id., § 1008. However, under both sections, an officer may
not be separated without a hearing before the Board of the Foreign
Service established by § 211 of the Act, 22 U.S.C. § 826, and his
unsatisfactory performance of duty or misconduct must be
established at that hearing. No such hearing was ever afforded
petitioner. Executive Order No. 9835 did not vest any additional
authority in the heads of administrative agencies to discharge
employees. It merely established new standards and procedures for
effecting discharges under whatever independent legal authority
existed for those discharges.
Cf. Cole v. Young,
351 U. S. 536,
351 U. S.
543-544. The only statutory provision which could be
deemed to authorize the Secretary to dismiss petitioner without
observance of the provisions of the Foreign Service Act was
therefore the McCarran Rider. The latter provision thus was an
indispensable supplement to the Department's authority if it was to
proceed against petitioner under the Loyalty-Security Regulations
as it did.
See p.
354 U. S. 376,
infra.
[
Footnote 13]
See Peters v. Hobby, supra, at
349 U. S.
342-343.
[
Footnote 14]
U.S. Department of State, Manual of Regulations and Procedures
(1949), § 390
et seq.
[
Footnote 15]
This qualification is without significance here in view of the
fact that the petitioner's case before the Department was handled,
down to the time of his discharge by the Secretary, under these
Regulations.
See p.
354 U. S. 376,
infra. Moreover, this phrase was deleted in the 1951
revision of the Regulations, as we note hereafter, p.
354 U. S. 376,
infra, and the respondents have insisted here that the
1951 revision is controlling,
see p.
354 U. S. 382,
infra.
[
Footnote 16]
We follow the parties in this case in using interchangeably the
terms "Deputy Under Secretary" and "Assistant
Secretary-Administration." When the Department's 1949 Regulations
were promulgated, the official charged with duties under them was
the "Assistant Secretary-Administration." At some time thereafter,
however, that official's functions were apparently transferred to a
Deputy Under Secretary.
Cf. Act of May 26, 1949, §§ 3, 4,
63 Stat. 111. To avoid confusion, we have used exclusively the
latter title in the text of this opinion regardless of its
technical correctness in the particular instance.
[
Footnote 17]
"391.1
Policy." For the Department's 1951 Regulations,
see U.S. Department of State, Manual of Regulations and
Procedures (1951), Vol. I, § 390
et seq.
[
Footnote 18]
"Department" is defined as including "the Foreign Service of the
United States." § 391.3.
[
Footnote 19]
"391.2
Loyalty Authority,' and '391.3
Security
Authority."
[
Footnote 20]
This statute is referred to in the subsection as "Public Law
733, 81st Congress," being the Act of August 26, 1950, 64 Stat.
476, 5 U.S.C. §§ 22-1, 22-3, which gave to the State Department,
among other departments and agencies of the Government, suspension
and dismissal powers over their civilian employees when deemed
necessary "in the interest of the national security of the United
States."
Cf. Cole v. Young, 351 U.
S. 536.
[
Footnote 21]
Referred to in the subsection as "General Appropriations Act,
1951, Section 1213, Public Law 759, 81st Congress."
[
Footnote 22]
S.Rep.No.2108, 81st Cong., 2d Sess., 15-16 (emphasis
supplied).
[
Footnote 23]
98 U.S.App.D.C. 271, 235 F.2d at 218.
[
Footnote 24]
See note 11
supra.
[
Footnote 25]
I.e., § 19(c) of the Immigration Act of 1917, as
amended:
"In the case of any alien (other than one to whom subsection (d)
is applicable) who is deportable under any law of the United States
and who has proved good moral character for the preceding five
years, the Attorney General may . . . suspend deportation of such
alien if he is not ineligible for naturalization or if ineligible,
such ineligibility is solely by reason of his race, if he finds (a)
that such deportation would result in serious economic detriment to
a citizen or legally resident alien who is the spouse, parent, or
minor child of such deportable alien, or (b) that such alien had
resided continuously in the United States for seven years or more
and is residing in the United States upon the effective date of
this Act."
62 Stat. 1206, 8 U.S.C. (1946 ed., Supp. V) § 155(c).
[
Footnote 26]
See pp.
354 U. S.
368-369,
supra.
[
Footnote 27]
This notice read:
"My Dear Mr. Service:"
"The Secretary of State was advised today by the Chairman of the
Loyalty Review Board of the U.S. Civil Service Commission that the
Loyalty Review Board has found that there is a reasonable doubt as
to your loyalty to the Government of the United States. This
finding was based on the intentional and unauthorized disclosure of
documents and information of a confidential and nonpublic character
within the meaning of subparagraph d of Paragraph 2 of Part V of
Executive Order 9835, as amended. The Loyalty Review Board further
advised that it found no evidence of membership on your part in the
Communist Party or in any organizations on the Attorney General's
list."
"Pursuant to the foregoing, the Secretary of State, under the
authority of Executive Order 9835, as amended, and Section 103 of
Public Law 188, 82nd Congress, has directed me to terminate your
employment in the Foreign Service of the United States as of the
close of business December 14, 1951."
"In view thereof, you are advised that your employment in the
Foreign Service of the United States is hereby terminated effective
[at the] close of business December 14, 1951."
[
Footnote 28]
The respondents argue that the proper rule to be applied is that
of
Vandenbark v. Owens-Illinois Glass Co., 311 U.
S. 538, holding that a change in the applicable law
after a case has been decided by a
nisi prius court, but
before decision on appeal, requires the appellate court to apply
the changed law.
And see Ziffrin, Inc. v. United States,
318 U. S. 73.
[
Footnote 29]
Petitioner argues that the decisions cited in
note 28 supra, are not in point
here because,
inter alia, the changed regulations were
invalid as to him under the Federal Register Act, 49 Stat. 502, 44
U.S.C. § 307, and the Administrative Procedure Act, 60 Stat. 238, 5
U.S.C. § 1002, because not published in the Federal Register.
[
Footnote 30]
§§ 394.13, 394.15, 395.1.
[
Footnote 31]
§§ 395.1, 395.53.
[
Footnote 32]
§§ 395.6, 396.11.
[
Footnote 33]
§§ 396.2, 396.3.
[
Footnote 34]
§§ 396.4, 396.5.
[
Footnote 35]
That this was understood to be the effect of the Regulations is
indicated by Department of State Press Release No. 247, March 13,
1950, which is reprinted in S.Rep. No. 2108, 81st Cong., 2d Sess.
254. Deputy Under Secretary of State John E. Peurifoy is there
quoted as stating, in reply to charges made on the floor of the
Senate:
". . . I am in full charge of loyalty matters, and . . . am
fully prepared to deal with these charges."
"Gen. George C. Marshall, as Secretary of State, vested in me
full responsibility and authority for carrying out the loyalty and
security program of the Department of State, and I have continued
to exercise the same responsibility and authority under Secretary
Dean Acheson."
"My decisions on matters of loyalty and security within the
Department are
final, subject, however, under the law,
in certain instances to appeal to the Secretary and the
President's Loyalty Review Board. Since the loyalty and security
program was launched in the Department, however, there has not been
a single instance in which a decision made by me has been reversed
or overruled in any way by Secretary Acheson."
(Emphasis supplied.)
[
Footnote 36]
Section 396.7 of the Regulations provided:
"If the Assistant Secretary-Administration or the Secretary of
State shall, during his consideration of any case, decide
affirmatively that an officer or employee is not disloyal and does
not constitute a security risk and that his case should be closed,
such officer or employee shall be restored to duty, if suspended,
and the record shall show such decision."
"In holding as we do, we by no means imply that, under these
Regulations, the action of the Deputy Under Secretary had the
effect of 'closing' petitioner's case irrevocably and beyond hope
of recall. No doubt proper steps could have been taken to reopen it
in the Department. But, consistent with his Regulations, we think
that the Secretary could in no event have discharged the
petitioner, as he did here, without the required action first
having been taken by the Department's Loyalty Security Board and
the Deputy Under Secretary."
[
Footnote 37]
In view of this conclusion, it becomes unnecessary to consider
the other respects in which petitioner claims that his discharge
contravened the 1949 Regulations.
[
Footnote 38]
See pp.
354 U. S.
375-376,
supra.
[
Footnote 39]
See pp.
354 U. S.
368-369,
supra.
[
Footnote 40]
We do not, of course, imply that the Regulations precluded the
Secretary from discharging any individual without personally
reading the "complete file" and considering "all the evidence." No
doubt the Secretary could delegate that duty. But nothing of the
kind appears to have been done here.
[
Footnote 41]
See note 20
supra.
[
Footnote 42]
Sections 393.2 and 393.3 further refined the standard by
defining five classes of persons constituting security risks, and
listing five factors which were to be taken into account, together
with possible mitigating circumstances.
[
Footnote 43]
Because of this conclusion, it is unnecessary to deal with the
other respects in which petitioner claims his discharge violated
the 1951 Regulations.