Panama Refining Co. v. Ryan, 293 U.S. 388 (1935)

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Panama Refining Co. v. Ryan

Nos. 135 and 260

Argued December 10, 11, 1934
Decided January 7, 1935
293 U.S. 388

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE FIFTH CIRCUIT

Syllabus

1. Upon review of a decree affirming the validity of an executive regulation, and refusing to enjoin its enforcement, rendered in a suit begun and ended below after the regulation had been withdrawn, the question of validity does not cease to be moot because the regulation has since been reinstated and the Government has declared its intention to enforce it from the time of reinstatement. P. 412.

2. A suit to enjoin the enforcement of executive regulations is not made moot by amendments of the regulations, adopted pending the litigation, which continue in force the requirements complained of and present the same constitutional question as before. P. 413.

3. Section 9 (c) of the National Industrial Recovery Act, purporting to authorize the President to prohibit the transportation in interstate and foreign commerce of petroleum and the products thereof produced or withdrawn from storage in excess of the amounts permitted by state authority, attaches criminal penalties to every violation of such an order, and persons who would thus become subject to repeated penalties in carrying on their business are entitled to invoke the equitable jurisdiction to restrain enforcement of the order if found unconstitutional. P. 414.

4. Assuming (not deciding) that Congress itself might have the power sought to be delegated to the President by § 9(c) of the National Industrial Recovery Act -- viz., the power to interdict the transportation in interstate and foreign commerce of petroleum and petroleum products produced or withdrawn from storage in excess of the amounts permitted by state authority -- the attempted delegation is plainly void, because the power sought to be delegated is legislative power, yet nowhere in the statute has Congress declared or indicated any policy or standard to guide or limit the President when acting under such delegation. Pp. 414 et seq.

The declarations of § 1 of Title I of this Act are simply an introduction in broad outline, leaving the legislative policy as to particular subjects to be declared and defined, if at all, by subsequent sections. The Court can find nothing in § 1 or elsewhere in the Act which limits or controls the authority sought to be conferred by § 9(c). The effort by ingenious and diligent construction to supply a criterion still permits such a breadth of authorized action as essentially to commit to the President the functions of a legislature, rather than those of an executive or administrative officer executing a declared legislative policy.

5. The question whether the delegation is permitted by the Constitution is not answered by the argument that it should be assumed that the President has acted, or will act, for what he believes to be the public good. The point is not one of motives, but of constitutional authority, for which the best of motives is not a substitute. P. 420.

6. If Congress can vest such legislative power in the President, it may vest it in any board or officer of its choice, and the power vested may concern not merely the transportation of oil or of oil produced in excess of what the States may allow; it may extend to transportation in interstate commerce of any commodity, with or without reference to state requirements; indeed, there would appear to be no ground for denying a similar prerogative of delegation with respect to other subjects of legislation. P. 420.

7. The principle forbidding Congress to abdicate, or to transfer to others, the essential legislative functions with which it is vested by Art. I, § 1, and Art. I, § 8, par. 18, of the Constitution has been recognized by the Court in every case in which the question has been raised . P. 421.

8. Congress may lay down its policies and establish its standards and leave to selected instrumentalities the making of subordinate rules, within prescribed limits, and the determination of facts to which the policy, as declared by Congress, shall apply, but the constant recognition of the necessity and validity of such provisions, and the wide range of administrative authority which has been developed by means of them, cannot be allowed to obscure the limitations of the authority to delegate, if our constitutional system is to be maintained. P. 421.

9. The question is not as to the intrinsic importance of the particular statute involved, but of the constitutional processes of legislation which are an essential part of our system of Government. P. 430.

10. Both § 9(c) and the Executive Order made in pursuance of it are in notable contrast with historic practice (as shown by many statutes and proclamations) by which declarations of policy are made by the Congress, and delegations are within the framework of that policy and have relation to facts and conditions to be found and stated by the President in the appropriate exercise of the delegated authority. P. 431.

11. If from the extremely broad description contained in § 1 of the Act, and the widely different matters to which the section refers, it were possible to derive a statement of prerequisites to the President’s action under § 9(c), it would still be necessary for the President to comply with those conditions and to show such compliance as the ground of his prohibition. P. 431.

12. If the citizen is to be punished for the crime of violating a legislative order of an executive officer, board or commission, due process of law requires that it shall appear that the order is within the authority of the officer, board or commission, and if that authority depends on determinations of fact, those determinations must be shown. P. 432.

13. When the President is invested with legislative authority as the delegate of Congress in carrying out a declared policy, he necessarily acts under the constitutional restriction applicable to such a delegation. P. 433.

71 F.2d 1, 8, reversed.

Certiorari was granted in these two cases to review decrees of the court below which reversed decrees of the District Court enjoining federal officers in Texas from enforcing certain executive orders and regulations. 5 F.Supp. 639. Both bills challenged the constitutionality of § 9(c) of the National Industrial Recovery Act and of orders made under it by the President and of regulations made under the President’s orders by the Secretary of the Interior. In one of the cases, No. 260, part of a Petroleum Code was attacked and defendant in ignorance of the fact that it had been dropped when amendments of the Code were promulgated before the beginning of the suit. The bill in that case also challenged legislation and orders of the State curtailing the production of oil, and joined the State Railroad Commission, its members, and other state officials as defendants; but this part of the case was severed and decided adversely to the plaintiffs by a three-judge court. See 5 F.Supp. 633, 634, 639. A detailed statement of both cases will be found in the opinion.