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of filing the petition for review, petition the court for such stay of execution which may be granted at the discretion of the court.

(b) In any case where a stay of execution is granted, the court may require a bond in such amount as it may consider reasonable and adequate.

SEC. 10. The court is authorized to adopt rules respecting review of the orders and decisions coming before it and the conduct of proceedings upon review, and the proceedings of the court and its divisions shall be conducted in accordance with such rules of procedure and practice as the court may prescribe.

Sec. 11. The review by the court shall be limited to questions of law, and the findings of fact of the commission, administrative authority, or tribunal, if supported by substantial evidence, shall be conclusive.

Sec. 12. If either party shall apply to the court to adduce additional evidence and shall show to the satisfaction of the court that such additional evidence is material and that there were reasonable grounds for failure to adduce such evidence at the hearing of the cause, the court may order additional evidence to be taken before the tribunal or authority and the tribunal or authority may modify its findings as to facts by reason of the additional evidence, and it shall file such modified new findings which if supported by evidence shall be conclusive, and it may file its recommendations for the modifying or setting aside of the original order or decision.

MISCELLANEOUS Sec. 13. (a) The chief justice, with the approval of a majority of the court, may appoint and fix the salaries of a chief clerk, who shall act as clerk of the court, and such deputy clerks as in the opinion of the chief justice may be necessary; a reporter who shall be in charge of the collection and reporting of decisions of the court and each division thereof; a legal staff, not to exceed one attorney to each division; and such law clerks as in the opinion of the chief justice may be necessary:

(b) The chief justice and each associate justice may appoint and prescribe the duties of a secretary at an annual salary not to exceed $3,000.

(c) The chief clerk shall receive a salary not to exceed $7,500 per annum. The deputy clerks shall receive a salary not to exceed $2,500 per annum. The reporter shall receive a salary not to exceed $5,000 per annum. The attorneys shall each receive a salary not to exceed $7,500 per annum. The law clerks shall each receive a salary not to exceed $3,600 per annum.

(d) The chief justice, with the approval of a majority of the court, shall have authority, subject to the provisions of the civil-service laws and the Classification Act of 1923, as amended, to appoint such stenographers, clerks, and other employees as are necessary in the execution of its functions.

SEC. 14. The court may make such expenditures (including expenditures for rent and personal services at the seat of government and elsewhere, for office furniture and supplies, lawbooks, periodicals, and books of reference; and for printing and binding) as may be necessary for the execution of its functions and as from time to time may be appropriated for by Congress. All expenditures of the court, including all necessary expenses for transportation incurred by the justices or employees of the court upon any official business of the court at places other than in the District of Columbia, shall be allowed and paid on the presentation of itemized vouchers therefor approved by the chief clerk of the court.

SEC. 15. The court shall provide for the publication of reports of its decisions in such form and manner as may be best adapted for public information and use, and such authorized publications shall be competent evidence of the decisions of the court therein contained in all courts of the United States without any further proof or authentication thereof.

SEC. 16. The court shall be located in the District of Columbia, where its general sessions shall be held; but whenever, in the opinion of the chief justice, the convenience of the public or of the parties may be promoted or delay or expense prevented thereby, a division of the court may hold special sessions in any part of the United States.

ADMINISTRATIVE PROVISIONS SEC. 17. (a) If any person fails or neglects to obey any order of a commission or administrative authority which may be reviewed on appeal as provided in this Act, when such order has become final and no stay of execution has been granted by the court, and while the same is in effect, whether a petition for review has been filed or not, the commission or any party injured thereby, or the United States by its Attorney General, may apply to the appropriate district court of the United States for the enforcement of such order. If, after hearing, that court determines that the order was)regularly made and duly served, that it has become final, and that the person is in disobedience of the same, the court shall enforce obedience to such order by writ of injunction or other proper process, mandatory or otherwise, to restrain such person or the officers, agents, or representatives of such person, from further disobedience of such order, or to enjoin upon it or them obedience to same. And the court shall assess a fine not to exceed $100 per day for each day such person fails or neglects to obey such order.

(b) DEFINITIONS. -As used in this section, the word "person” includes a corporation, partnership, or trust.

Senator LOGAN. I asked Mr. Sebree, of the Board of Tax Appeals, to come this morning to testify. I might say requests have been made by the American Bar Association to be heard. I will take this occasion to say that everyone who desires to be heard, with certain exceptions which I will not mention here, will be heard at any time to suit the convenience of the witnesses and the committee.

Colonel McGuire is here. He has been working on this matter for a long time. I want to hear his testimony, which I am sure the committee will be interested in. We will first hear Mr. Sebree this morning, and then consider when we will have another hearing.

STATEMENT OF J. EMMETT SEBREE, WASHINGTON, D. C.
Senator LOGAN. Please state your name for the record.
Mr. SEBREE. J. Emmett Sebree.
Senator Logan. Where do you reside?
Mr. SEBREE. I reside at 1629 Columbia Road.
Senator LOGAN. What is your position here?

Mr. SEBREE. I am a member of the legal staff of the Board of Tax Appeals, and I am professor of administrative law in National University.

Senator Logan. How long have you been connected with the Board of Tax Appeals?

Mr. SEBREE. About 18 years.
Senator LOGAN. How long have you been interested in this program?
Mr. SEBREE. Well, since 1918; not all the time, of course.

Senator Logan. I will ask you to proceed and make any statement about this bill that may occur to you and, after

you

have finished your statement, the members of the subcommittee will perhaps desire to ask you certain questions touching the matter. You may proceed.

Senator King. You drew this bill, did you not?
Mr. SEBREE. I assisted in drawing it. I had a good deal of help.

In order to get the picture before the committee, I have noted some historical facts as a background leading up to the necessity for such a court as is included in this bill. I would like to read this into the record as my statement.

Senator Logan. You may proceed to do so.

Mr. SEBREE. One of the most important and the most difficult problems of government today is that of public administration, and arising out of public administration is the problem of the adjudication of controversies arising out of administrative action. Perhaps we can better appreciate the problem if we first examine our administrative system as it has been developed by the demands of a country which has grown from the Thirteen Colonies of 1789 to the greatest commercial Nation in the world in 1938.

The development of our administrative system has been accomplished with little regard for the separation of powers strictly construed. Senator King. You do not approve of that, do you?

Mr. SEBREE. Yes; I do to a certain extent, Senator, as I will endeavor to show as I go on.

Senator KING. You take the same view that McFarland did in his book on Federal officials, that what we need is expedition and not so much law?

Mr. SEBREE. Not entirely that, Senator.

This has been due largely to the fact that administration is government in action and must function continuously and in detail. The carrying on of the Government's business is a practical matter and just how far a precise separation of powers is either possible or desirable in practice is a difficult problem. In the regulatory bodies and many of what might be termed the proprietary functions of government, such as revenue and contracts, it is important that the officers charged with the rule-making power do not sit as final judges in controversies arising under the rules which they have established. But the advministrative authorities must be left free to make administrative determinations in the first instance in order that government may function. And the rights of the individual affected by administrative action can be adequately safeguarded by giving him an opportunity for a full hearing before final action of the administrative authority and the right to appeal from such action.

In the early history of the Republic the demands upon government were comparatively few and the problems of administration correspondingly simple. For nearly 100 years public administration was confined largely to what we might term governmental activities, such as the State, War, Navy, Treasury, and Post Office Departments, which were established in 1789; the Interior Department, established in 1849; and the Department of Agriculture, created in 1862 and established as an executive department in 1889. During this period the controversies arising out of administrative action involved, for the most part, the constitutional power of the administrative authority to act, and resulted in the constitutional delimitation of the sphere of administrative action.

With the expansion of the country came large industrial enters, great metropolitan areas, rapid transportation, and large commercial and industrial enterprises, all of which have made tremendous demands upon government and created innumerable problems of a social and economic nature which have become matters of public concern. In this situation government has developed new methods and established new agencies of administration to efficiently handle its increased business.

Following the decision of the Supreme Court in 1824 of the famous case of Gibbons v. Ogden, in which Chief Justice Marshall stated that commerce was traffic and intercouse which could be regulated by Congress under the power conferred by the Constitution, excepting where it was entirely intrastate, the concept of commerce has been steadily expanded by the decisions of that Court, and extended by legislation to include the Federal control of such things as transporta tion, agriculture, food and drugs, communications, unfair competition in business, fuel, labor relations, the issuance of securities and business in general.

The first important regulatory legislation was the Interstate Commerce Act of 1887, under which one of the most outstanding administrative agencies in the Federal system was set up, the Interstate Commerce Commission. Within the 50 years following the establishment of the Interstate Commerce Commission there have been set

up

either within the Executive Departments or as independent agencies outside the departments nearly 100 agencies or tribunals exercising judicial or quasi-judicial functions in adjudicating disputes that arise from administrative action.

Regulatory authorities created to regulate and control such things as industry, commerce, economic resources, financial operations, electric power, labor relations and agriculture, have been developed in our administrative system as boards, commissions, and administrators charged with special administrative duties. As the process of administration has developed, administrative adjudication of disputes has become an integral part of the functioning of these regulatory authorities either directly because they are established to settle particular types of disputes or, as is generally the case, because adjudication results from their operation.

The development of independent agencies has been unitary or piecemeal and for the most part without any real coordinating control. Congress has simply created new agencies for the work in hand and no provision has been made for simplification or uniformity of procedure with regard to the various agencies performing substantially similar functions or for uniformity of decision of related questions. The result is it has been left to the courts to develop an administrative jurisprudence adequate to cope with the changing situations of today. Administrative jurisprudence as developed by our Federal courts is based upon common law concepts wbich emphasize individual property rights and duties rather than upon public law concepts and the duties of the citizen to his government and to society. The result is a trend toward technical construction which does not come to grips with the realities of the present-day economic situation.

In the ordinary processes of administration procedure is and must necessarily be informal. The independent tribunals, boards, and commissions have developed very elaborate rules of procedure which are published. These rules are very much alike in the different regulatory authorities, but there is enough difference in the substance and methods of procedure to cause great confusion among lawyers who find it exceedingly difficult to practice before several different tribunals where they must not only know in general what the procedure is but its details in order to properly protect the interests of their clients. The same may be said of the appellate procedure.

In all of the orders and decisions with which we are concerned here the review of administrative action is either by the United States district courts and the United States District Court for the District of Columbia or by the United States circuit courts of appeals and the United States Court of Appeals for the District of Columbia. In certain classes of cases the review is exclusively in the latter court. Where there is a review in the district court it results in a trial de novo with a duplication of the proceedings which were had before the board or commission issuing the order. In such a proceeding the findings of fact of the board or commission are evidentiary only.

It should be entirely unnecessary to require this proceeding de novo and the consequent delay and expense incident to a final adjudication of the controversy. The hearing before the board or commission is, or if it is not should be required to be, so complete that a hearing de novo is unnecessary and the findings of fact of the board or commission should be conclusive subject only to a rehearing of the cause where it is deemed necessary for the ends of justice. It is practically impossible to get uniformity of decision on similar questions where they are subject to review by 85 district courts including the District Court for the District of Columbia, and there is no doubt that litigation is encouraged by the hope of obtaining a different decision in a different court.

As to the 11 circuit courts an even more serious situation is presented except in the few cases where the Court of Appeals for the District of Columbia has exclusive jurisdiction on review. By far the larger number of the orders and all of the decisions with which we are here concerned are reviewed on appeal to the United States circuit courts of appeals or the United States Circuit Court of Appeals for the District of Columbia. In this situation there not only are bound to be conflicting decisions on the same questions, but a variety of dicta in decisions of similar questions which is almost as potent in encouraging litigation in the various circuit courts as conflicting decisions.

This is particularly well illustrated by the situation in the case of the Board of Tax Appeals, whose decisions would constitute approximately 50 percent of the appeals coming before the proposed court. With 11 appellate courts reviewing the decisions of the Board, the value of such decisions as precedents is largely lost. Whatever unity and harmony is found in the Board's decision on related questions is overcome when several coordinate higher courts speak in divers and various expressions on the same subject. Of course, deverse and conflicting decisions in different circuits are impossible to administer uniformly; but the difficulty does not stop there—it is increased by the variety of dicta and implications and points of view of courts of equal superiority authority.

Parties cannot reasonably be expected to yield a point upon which a court has intimated a favorable view, even though another court of appeals has actually decided the point adversely. Litigation in the Board is thus fomented and encouraged, settlement of cases before trial is in such cases unlikely, or, if made, are more difficult and the Board's docket and calendar are cluttered with repeated controversies of the same question made more difficult by the task of choosing between conflicting superior views. There are instances where the same opinion of the Board in a single group of cases is appealed to several available courts for the sake of one advantage or another, perhaps in the hope of obtaining at least one favorable decision. Necessarily the question is not settled until all appeals are decided and conflict resolved by the Supreme Court. During the interim and pending the decision of the Supreme Court new cases accumulate and collection or refunds are retarded.

A great deal of the time of the appellate courts is taken in the consideration of these cases, and in some circuits there are long delays before cases are decided. There is no doubt that the scattering of appeals in tax cases among 11 appellate courts is an expensive luxury

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