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sonnel difficulties. While the system certainly permits an office director, such as a general counsel, to arrange for the reassignment of individuals in whom he has little or no confidence, as a practical matter, most office directors who have had any experience in such matters feel that the difficulties and pressures involved in such a request for reassignment make the entire process not worthwhile. Consequently, we had several attorneys within the legal office whose incompetence was widely known not only within the Commission but also within its coordinate agencies and at the Department of Justice, but whose reassignment was stymied by the aforementioned reticence. Such a situation is perhaps common to all agencies of the government, but it seems especially regrettable in an agency with very pressing responsibilities and already severely understaffed.
The General Counsel's Office was operated on an informal basis and without much regard to the formalities of civil service ratings and other such matters. Under such circumstances, every attorney in the office, regardless of grade or length of experience, had an equal chance to assume major responsibility. Everyone in the office had about the same degree of experience in the stabilization of prices and rents. For example, all litigation involving the Commission, both offensive and defensive, was coordinated by a young recent law school graduate with no experience but with a great capacity for hard work and well-developed organizational skills. It was a great place for the go-getter, the self-starter, the bright intellect and it was a place where the inadequacies of the less-motivated individuals quickly came to light.
THE PROGRAM'S NEEDS AT THE MOMENT
The old axiom that it is the squeeky wheel that gets the grease is a good rule of thumb when it comes to the operations of the legal office of a new agency formed to meet an emergency situation. One simply does not have the time or the staff to give the requisite attention to all of the many hundreds of legal issues to which attention should be directed. The big ones come first on the list of priorities. Creative Legal Thinking
Likewise, and for many of the same reasons, it is not always possible to develop a Commission policy which is legally foolproof and beyond challenge. While this is true in any endeavor, it causes greater concern when so much rests on the legal sufficiency of an action that could affect millions of people, millions of dollars worth of private-sector decisions and which may have great influence on the success of the agency itself. Risk-taking is part of the game as long as the General Counsel is not forced to take a frivolous legal position just to accommodate the needs of the program as perceived by the program's directors. I have two illustrations of this basic point.
First is the decision of the Price Commission in the Spring of 1972, six months after the beginning of Phase II, to bolster its enforcement and compliance strategy through the issuance of treble rollback orders to firms that had violated the Price Commission's profit margin limitation. It was well understood within and without the Commission that, confronted with a violation, the Commission could request that the Department of Justice initiate a law suit against the alleged violator to recover a civil penalty or a criminal fine and possibly to seek a court order rolling back illegal prices or providing for other appropriate relief to make up for the violation. This approach to the compliance issue was specifically supported in the Economic Stabilization Act of 1970, as amended, and would have provoked no legal controversy. On the other hand, the limited numbers of cases which the Depart
ment of Justice could reasonably be expected to initiate on behalf of the Commission, the expected slow pace of any litigation, and the fact that even in successful court cases the defendant might possibly be penalized only $2500 to $5000, led the Commission's staff to develop alternate administrative remedies for application to alleged violators.
The treble rollback procedure was developed by certain members of the operating staff in the Office of Program Operations. It was conceded by all as having a potential for great effect in persuading the business community that the Commission meant business. The only real problem with the treble rollback concept was the fact that there was a good argument that the Commission was without authority to issue such orders. In the extreme, this argument held that the Commission was without authority to issue any orders respecting any subject, short of regulations, and that all enforcement of its regulations had to be accomplished through the judicial process. On the other extreme were those, including the Commission's General Counsel, who believed that the Commission had an inherent power to issue any orders “necessary and proper" to the accomplishment of its statutory responsibilities, excepting, of course, orders imposing criminal sanctions. The Commission's decision to proceed with the treble rollback process was supported on a practical basis as being absolutely necessary to the success of the program, and justified on a legal basis as being within the scope of the Commission's authority to enforce regulations which had been legally promulgated and at least constructively known to those later accused of violating them. There was obvious legal risk involved in the decision but, fortunately, the treble rollback proceeding was never successfully challenged; it is probably true that the success of Phase II would have been diminished significantly had the rollback procedure not been implemented and its clear message to the business community not been communicated.
A related example of the need for creative legal thinking in an emergency program with very specific and difficult goals was the Commission's decision in mid1972 to begin a program of settling certain claims against alleged violators for a sum below that which could have been obtained in court or which could have been extracted through the administrative order process. This was the compromise settlement procedure. Once again, the statute was silent with respect to the Commission's ability and authority to compromise its claims. It was clear that the Department of Justice, on behalf of the Commision, could initiate a law suit for the recovery of a $2500 civil penalty for each violation, and could settle the claim for a lesser sum, but it was unclear whether, in the interest of avoiding litigation and to prevent the district courts from becoming mere collection agencies, the Commission would settle with the prospective defendant for less than the $2500 figure without the prior institution of a suit by the Justice Deparment.
There was a great deal of controversy about the compromise settlement procedure among the legal officers of the Pay Board, Cost of Living Council and Commission and with members of the Economic Stabilization Section of the Department of Justice. We believed that there was a very good argument that there was inherent power within an agency that could litigate for a larger sum, to settle for less to avoid litigation. We intended to go forward with the compromise procedure we had devised. In this case however, we were fortunate to have been able to secure an opinion from the Office of Legal Counsel at the Justice Department which supported our legal position. The compromise settlement program was initiated immediately and proved most successful.
2. The legal staff of the Cost of Living Council and Pay Board agreed that the
Commission should proceed with the rollback procedure.
By: Ward B. Hinkle
The focus of this paper is broader than public affairs and includes the dissemination of regulations and policies from Stabilization agencies to the regulated public. Its subject headings follow temporal divisions in the Program. Included as appendices are shorter essays on the IRS's involvement in public communications; descriptions of specific offices in the Stabilization agencies; and an essay tracing public opinion of controls during the life of the Program.
Mr. Hinkle is a 1968 graduate of Yale College and is presently a third-year law student at the University of Pennsylvania.
Sterling Brinkley is a 1974 graduate of Yale.