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MATTHEW ADDY CO. v. U S, 264 U.S. 239 (1924)

U.S. Supreme Court

MATTHEW ADDY CO. v. U S, 264 U.S. 239 (1924)

264 U.S. 239

MATTHEW ADDY CO.
v.
UNITED STATES.

FORD
v.
SAME.

Nos. 84, 85.
Argued Oct. 17, 18, 1923.
Decided Feb. 25, 1924.

Messrs. Julius R. Samuels and Nelson B. Cramer, both of Cincinnati, Ohio, for petitioners.

The Attorney General and Mr. George Ross Hull, of Washington, D. C., for the United States. [264 U.S. 239, 240]  

Mr. Justice McREYNOLDS delivered the opinion of the Court.

The petitioners were found guilty of violating the President's order of August 23, 1917, by receiving margins above those prescribed for coal jobbers. Both causes present the same fundamental questions and one opinion will suffice.

The Lever Act, 'An act to provide further for the national security and defense by encouraging the production, [264 U.S. 239, 241]   conserving the supply, and controlling the distribution of food products and fuel,' approved August 10, 1917, c. 53, 40 Stat. 276, 284, 286 (Comp. St. 1918, Comp. St. Ann. Supp. 1919, 3115 1/8 q, 3115 1/8 qq), provides:

On August 21, 1917, after prescribing a schedule of prices for bituminous coal at the mine, the President said:

August 23, 1917, pending further investigation and determination, it was ordered by the President:

September 6, 1917, the Fuel Administrator directed that--

[On August 23 the President issued an order fixing prices for anthracite coal at the mines, effective September 1st.]

A statement and order by the Fuel Administrator, dated September 7, 1917, contained the following paragraphs: [264 U.S. 239, 243]   'A very large proportion of the coal supply available for the coming winter is under contract. These contracts, which are allowed to stand for, the present, were made prior to the President's proclamation and very largely limit the amount which may be placed on sale at retail prices based on the President's order.

On October 6, 1917, the Fuel Administrator further directed--

The Fuel Administrator issued many other orders, not presently important.

The petitioning corporation, Matthew Addy Company, acting by petitioner Ford, the Vice President, did business as coal jobber at Cincinnati, Ohio. By contract dated July 31, 1917, it purchased many carloads of coal from Bluefield Coal and Coke Company, at $3.25 per ton f. o. b. the mines in West Virginia. With knowledge of jobbers' margins fixed by the President's order of August 23, 1917, it sold sundry lots of this coal during August and September, 1917, at $3.50 per ton f. o. b. the mines, without having contracted so to do before that order issued. Do these circumstances suffice to establish the offense charged? We think not; and, accordingly, the judgments below must be reversed.

The order must be construed as criminal statutes are-strictly and without retroactive effect unless clearly indicated. [264 U.S. 239, 245]   Chew Heong v. United States, 112 U.S. 536, 559 , 5 S. Sup. Ct. 255; Shwab v. Doyle, 258 U.S. 529, 534 , 42 S. Sup. Ct. 391, 26 A. L. R. 1454. If it be construed as applying to the sales of coal purchased by petitioners prior to August 23d, we must decide a grave constitutional question, not necessary to consider if another view be accepted. Under the existing circumstances, did Congress have power to fix prices at which persons then owning coal must sell thereafter, if they sold at all, without provinding compensation for losses? If this difficulty can be eliminated by some reasonable construction of the order, it should be accepted. United States v. Delaware & Hudson Co., 213 U.S. 366, 407 , 408 S., 29 Sup. Ct. 527.

The above quoted statements and orders show plainly enough that in August, 1917, a very large part of the available coal supply was under contract. This greatly limited the amount which 'may be placed on sale at retail prices based on the President's order,' as pointed out on September 7th. Nevertheless, the contracts were 'allowed to stand for the present.' Evidently the purpose was to begin the administration of the fuel supplies by regulating subsequent transactions without striking down all existing bona fide contracts which might affect such supplies. If, prior to August 23d, petitioners had agreed to sell coal purchased in July, such contracts would not have been within the order. October 6th more sweeping rules were promulgated; one of them has direct relation to circumstances like those here presented.

The order treated buying and selling as integral parts of the regulated transaction and made no reference to expenses incident thereto. If it applied only to transactions thereafter begun, all had opportunity to govern themselves accordingly; but, if given retroactive effect, jobbers who had negotiated purchases at costs exceeding fifteen cents per ton would necessarily lose if they sold, although they had acted in entire good faith. Certainly, there was no purpose to encourage hoarding, contrary to [264 U.S. 239, 246]   the Lever Act, 26, or to retard movement of fuel to the ultimate consumers by making sales unprofitable. No imperative reason appears for treating jobbers who had bought but had not contracted to sell with less consideration than was accorded those with agreements for sales, irrespective of the stipulated price.

Considering the ordinary rules of interpretation and the circumstances disclosed, we conclude that the order of August 23d did not apply to the sales in question. It was not retroactive, and the sales were but part of a transaction begun before its date. We are not unmindful of the forceful argument to the contrary; and we consciously refrain from indicating any opinion respecting the validity of the order as interpreted.

The judgments of the court below are reversed and the causes will be remanded to the Distict Court for further proceedings in harmony with this opinion.

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