this Act and such other jurisdiction as Congress may from time to time confer upon it.

Then, beginning with line 23, on the same page, it provides:

All such jurisdiction now vested in the United States circuit courts of appeal, the United States Court of Appeals for the District of Columbia, the United States district courts, and the United States Court for the District of Columbia— And this I emphasize

is hereby abolished as to all such orders and decisions becoming final 90 days after the effective date of the passage of this Act.

I asked the question sometime ago if you would not by this bill take over the work of these different courts, which they are now discharging, and I thought you said "no."

Mr. SEBREE. We will take over the work of the district courts.

Senator KING. Mr. Chairman, I have another committee meeting to attend. I would like to ask that, at the conclusion of the hearing, you put in the record a tentative bill hearing upon the same general question, which I submit, as a matter of comparison.

Senator LOGAN. Very well.

Mr. SEBREE. Here are the district courts. Take, for instance, the Interstate Commerce Commission. That comes in here to a threejudge court. It also goes up here to a three-judge court. From that court it would go on appeal to the Supreme Court. This black line here and here indicates the extent to which the proposed court would take the cases which are now heard de novo in the district courts.

Senator AUSTIN. Are there any people who can give us some idea of the quantity of work that is?

Mr. SEBREE. I do not have those figures with me. I can get substantially those figures for the committee, I think. They are not as large as you might think. By far, in volume, the large amount of that business goes to the circuit court of appeals, from the Board of Tax Appeals, the processing tax, and the orders of the Interstate Commerce Commission.

Senator AUSTIN. None of that goes up from your board to the district court?

Mr. SEBREE. No.

Senator AUSTIN. Those three-judge courts are limited to a few statutes?

Mr. SEBREE. That is right.

Senator AUSTIN. So that the number of three-judge cases over the country is not large?

Mr. SEBREE. I do not know exactly how large it is. It is not as large as you might think.

Senator NORRIS. We added to it in the last session of Congress.

Mr. SEBREE. There is a good deal of business going up from some of the commissions to three-judge courts, especially from the Interstate Commerce Commission; but as to the relative number of cases, I would not be able to say at this time.

Senator LOGAN. Have you anything further you wish to say?
Mr. SEBREE. Nothing further, Mr. Chairman.

STATEMENT OF O. R. M’GUIRE, COMMITTEE ON ADMINISTRATIVE LAW, AMERICAN BAR ASSOCIATION

Senator LOGAN. You may state your name and residence.

Mr. MCGUIRE. O. R. McGuire, 1703 North Hill Street, Arlington, Va.

Senator NORRIS. I think for the record it might be well to identify him further.

Senator LOGAN. Just give your present business, what you are doing?

Mr. MCGUIRE. I have been a member of the committee on administrative law of the American Bar Association since it was created in 1933. For the past 2 years I was chairman of it. Dean Pound, of Harvard, is now chairman. Officially, I am counsel for the Comptroller General, but I am not here in my official capacity.

Senator NORRIS. How long have you been connected with the Comptroller General?

Mr. MCGUIRE. I have been with the Accounting Office since 1918. I was there when the office of Comptroller General was created, and I have been with it ever since.

Senator LOGAN. Did you not collaborate with Mr. Beck in the writing of a book called Our Wonderland of Bureaucracy?

Mr. MCGUIRE. Yes; which was commented on by you with respect to the lack of judicial review, Senator Norris, in 1928, with respect to one of these bills.

Senator LOGAN. All right, Colonel. You may proceed.

Mr. MCGUIRE. This committee on administrative law made a report last September to the American Bar Association, pertaining to the administrative problems. We formulated certain resolutions with the report and a draft of a bill. The draft of a bill was sent to all members of the house of delegates, and to every Member of the Senate and House of Representatives, and Senator King has just placed a copy in the record.

Senator LOGAN. He has not placed it in the record. He asked to have it placed in the record. I would be glad if you would present it. Mr. MCGUIRE. I will present it for the record.

(The document referred to, entitled "A bill to provide for the more expeditious settlement of disputes with the United States, and for other purposes," is set forth in full at the conclusion of the statement of Mr. MCGUIRE.)

Mr. MCGUIRE. I would like to have that followed by a copy of the resolutions formulated by the committee on administrative law and submitted to the house of delegates of the American Bar Association. This report shows the action taken by the house of delegates in approval of part of the resolution indicated in this report as it was written, and a part in principle.

(The document referred to, entitled "Report of the Special Committee on Administrative Law," is set forth in full at the conclusion of the statement of Mr. McGuire.)

Senator LOGAN. You may proceed.

Mr. MCGUIRE. The committee on administrative law was directed to draft a bill along the lines of the action taken by the house of delegates and submit it to the board of governors for approval before being introduced in Congress. A new committee was created in

September 1937, and that committee has not yet finished the draft of a bill. The president of the American Bar Association has stated that it was expected that draft would be completed and submitted to the board of governors for its action of May in this year. The president has also requested that the opportunity be afforded to Dean Pound of Harvard University, now chairman of the committee, and all members who are interested in this problem, to testify at subsequent meetings of this subcommittee of the Judiciary Committee.

Senator LOGAN. You will please advise the president of the American Bar Association and Dean Pound that this committee is trying to do something of a constructive nature; that it has no pride of opinion as to authorship; and that it wants all the help we can get. If the American Bar Association brings here a bill that is an improvement over this bill in any respect, we will be very glad to accept it. We are trying to get something started. We have been working 10 years without even a hearing. The American Bar Association has a hard time to reach any definite conclusion. You may deliver that

message.

Mr. MCGUIRE. Very well.

Senator LOGAN. Have you anything further?
Mr. MCGUIRE. I think not at this time.

(The documents heretofore referred to, "A bill to provide for the more expeditious settlement of disputes with the United States and for other purposes," and the "Report of the special committee on administrative law to the American Bar Association," respectively, are here set forth in full, as follows:)

A BILL To provide for the more expeditious settlement of disputes with the United States and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled:

Section 1. Implementing RULES AND REGULATIONS.—That within one year from the effective date of this act and with the approval of the President, the head of every department or independent establishment of the Federal government, including every board, commission, authority, or other agency of the United States (hereinafter in this Act referred to as department), after publication of notice to and hearing interested parties shall issue rules and regulations to implement every statute commencing with the United States Code and all statutes thereafter or hereafter enacted from time to time) affecting persons or property, required to be administered or enforced by such department, by rules of procedure and definitions of policy for the purpose of filling in the details of such statute. Such rules and regulations may be amended from time to time with the approval of the President. All such rules and regulations and amendments thereof shall be published in the Federal Register within ten calendar days from the date of their approval by the President, and shall not be effective until published, except in a public emergency stated in the regulation. No provision of any statute affecting any obligation, privilege, license or permit shall apply to any act done or omitted in good faith in conformity with a rule or regulation or amendment thereof even though the rule, regulation or amendment has been judicially determined to be invalid. This period of immunity shall extend only for thirty calendar days from the date of publication in the Federal Register of notice of the judicial determination of the invalidity of the rule, regulation or amendment thereof. No court shall hold any rule, regulation or amendment invalid except when it violates the Constitution of the United States or is in excess of the authority conferred by the statute or statutes pursuant to which it is issued.

Explanation. The purposes of this section are: (1) To require the issuance of rules and regulations defining both the adjective and substantive details of Federal statutes; (2) To authorize and require public notice and

hearing if requested prior to such issuance of the rules and regulations; (3) To provide a method by which the subordinate officers and employees of the Government may be controlled, in their administration of the statutes; (4) To provide a method whereby business men and others may be advised in advance of administrative action determining particular cases as to the administrative interpretation of the statutes; and (5) To protect the citizen acting in good faith in accordance with rules and regulations for a reasonable period after the rule or regulation is rescinded, amended, or held invalid. The basic statute in this matter is section 161, Revised Statutes, which originated in the act of July 27, 1789, 1 Stat. 28. This section provides that: "The head of each Department is authorized to prescribe regulations, not inconsistent with law, for the government of his Department, the conduct of his officers and clerks, the distribution and performance of its business, and the custody, use, and preservation of the records, papers, and property appertaining to it."

Many statutes relating to particular subject matters likewise contain authority to issue rules and regulations. Possibly the best of these provisions is contained in the recent Securities and Exchange Act of May 27, 1933, 48 Stat. 85, as amended by the act of June 6, 1934, 48 Stat. 908, as follows: "The Commission shall have authority from time to time to make, amend, and rescind such rules and regulations as may be necessary to carry out the provisions of this title, including rules and regulations governing registration statements and prospectuses for various classes of securities and issuers, and defining accounting and trade terms used in this title. No provisions of this title imposing any liability shall apply to any act done or omitted in good faith in conformity with any rule or regulation of the Commission, notwithstanding that such rule or regulation may, after such act or omission, be amended or rescinded or be determined by judicial or other authority to be invalid for any reason.'

There are many decisions of the courts holding that rules and regulations issued pursuant to, and in conformity with law, have the force and effect of law. United States v. Eaton, 114 U. Š. 677; Caha v. United States, 152 U. S. 219; Haas v. Henkel, 216 U. S. 462; United States v. McDaniel, 7 Peters 1; Boake v. Comingore, 177 U. S. 459; Merrill v. Jones, 106 U. S. 466; Ex-Parte Reed, 100 U. S. 13; Sherlock v. United States, 43 Ct. Cls., 161; Exparte Curtis, 106 U. S. 371; Campbell v. United States, 107 U. S. 407; United States v. Foster, 233 U. S. 515; United States v. George, 228 U. S. 14.

Generally speaking, the practice in this country has not been to issue rules and regulations after notice and hearing of interested parties. As this Committee stated in its 1936 report to the Association, the Supreme Court of the United States held in the Panama Refining Company, 293 U. S. 388, 415, and Schechter, 295 U. S. 495, cases, that one of the three requisites for the exercise of delegated legislative power-or the issuance of rules and regulations having general application-was a requirement of a finding by the administrative agency in the exercise of the authority delegated. The English practice is for notice and hearing.

The First Parliamentary Counsel-corresponding somewhat to the Legislative Counsel to the Senate and to the House of Representatives-stated to the Committee on Ministerial Powers (appointed by the Lord Chancellor to investigate the charges made by Lord Chief Justice Hewart in his book, The New Despotism) that:

"In my opinion one of the most important safeguards against the improper use of delegated powers (though this applies much more as respects Regulations of a personal or local character) is the fact that no Minister in his senses with the fear of Parliament before his eyes would ever think of making Regulations without (where practicable) giving the persons who will be affected thereby (or their representatives) an opportunity of saying what they think about the proposal."

The Procurator-General and Treasury-Solicitor of England stated before the same Committee that:

"It is, I think, important that due notice should be given of any intention on the part of a Department to make new rules and regulations. This is in fact secured very fully at the present time, because organizations of trade, professional and other interests, has proceeded so fast of late years that it can rarely, if ever, happen that there is not somebody whom a Department can consult before rules, regulations, or orders are made affecting the interests of the persons whom that body represents, and these organized bodies are in practice always consulted and an expression of their views obtained."

The said Committee on Ministers' Powers recommended that the Rules and Publications Act of 1893 be extended to include all rules and regulations and that:

"The system of the Department consulting particular interests specially affected by a proposed exercise of law-making power should be extended so as to ensure that such consultation takes place whenever practicable.'

We think that there should be a legal requirement for notice and opportunity for hearing before rules and regulations are issued, more particularly since we propose to expand the terms of section 161, Revised Statutes, supra, so as to require that the rules and regulations shall deal with both the adjective and substantive law sides of any statute the department or other agency may be required to administer. At present, except for the Bureau of Internal Revenue, Bureau of Customs, and the Securities and Exchange Commission (the latter having a special statute to that effect, as above quoted), the Department of Agriculture and the Interstate Commerce Commission, the various agencies of the Government generally limit their rules and regulations to the adjective side of the law.

Such a limitation is unsatisfactory for a number of reasons: First, business men and their legal advisers as well as labor organizations and their advisers or any other individual or group affected by a particular statute can not find out in advance of the trial and error method-suit by or against the United States or its officers, where such an action will lie-what the statute actually means or what the administrative officers of the Government think it means. There is no existing procedure by which an advisory opinion may be obtained from the courts and jurisdiction could not be conferred on the constitutional courts to render such opinions. Such jurisdiction could be conferred on the legislative courts, but it would be dangerous from the standpoint of the courts because organized minorities displeased with an advisory opinion might bring about the abolishment of the court, as was done with respect to the earlier Commerce Court.

Second, the courts are not expert administrators and are not familiar with the administrative processes. Generally speaking the judges of the courts lack the necessary first hand information to enable them to implement the statutes by advisory opinions even if it were not otherwise undesirable to give them such jurisdiction. Third, law-making, whether by statute or rules and regulations-is essentially a political function and to require the courts to legislate from case to case in filling in the details of statutes is to bring them into conflict with the other two political branches of our Governmentthe Legislative and the Executive. If, as proposed, the political branches of the Government be required to fill in the details of the statutes, both adjectively and substantively, the courts will not be required to do so and they may then perform their intended function of judging whether the statute is constitutional, whether the rules and regulations are in accord with the Constitution and statute under which issued, and whether the facts bring the case within or without the statute and regulations.

By such procedure we accomplish a double purpose: (1) We enable the citizen to find out what the administrative officers may think the law means without having to go to court, either as a defendant or plaintiff; and (2) We have the details of the statutes filled in by the administrative officers, who are familiar with the administrative problems and processes, rather than by the courts and we protect the courts from the warring social and economic forces-diverting their hostility to the political branches of the Government which are responsible for legislating in accordance with the terms of the Constitution.

Further, the proposed section intends to protect the citizen or other person acting in accordance with a rule or regulation for thirty calendar days after the rule or regulation is rescinded or held invalid and notice to that effect has been published in the Federal Register. As the law now stands, a rule or regulation, affords no protection unless it is in accord with the law. Whether it is in accord with the law must be found out after a suit in the courts with the person affected being either a defendant or-where suit may be maintained on the merits against the Government-a plaintiff. This is a long, expensive, and unsatisfactory process. This newer thought in respect to legislation is incorporated in the above quoted terms of the Securities and Exchange Act, but it does not go far enough in extending immunity for a period of thirty calendar days after publication of notice of the invalidity of the rule or regulation so as to enable the person affected to secure notice and readjust his business or professional practices accordingly.