Mechling Barge Lines, Inc. v. United States (368 U.S. 324)/Opinion of the Court

In December 1958 the appellee railroads published and filed with the Interstate Commerce Commission tariffs establishing through combination rates, from grain producing areas in Northern Illinois to certain Eastern destinations, which were lower than local or flat rates for the same commodities from Chicago to the same destinations. Since these tariffs would be in violation of the long-and short-haul provisions of § 4(1) of the Interstate Commerce Act, the railroads simultaneously applied for the administrative relief which is authorized by the first proviso to § 4(1). Timely protests were filed by the appellant barge lines, alleging that the proposed railroad rates threatened the extinction of legitimate competition by water carriers for the traffic from the producing areas into Chicago. On January 9, 1959, Division 2 of the Commission entered Fourth Section Order No. 19059, authorizing the proposed railroad rates-although expressly withholding approval of them-pending further Commission action. The Order was entered before any hearing had been held or investigation completed, and the Division did not set out any findings. On the same day, Division 2 ordered that an investigation be instituted with respect to the lawfulness of the rates.

Pending final Commission determination as to whether permanent Fourth Section relief was warranted, and after Order 19059 had been in effect for 10 months, the appellant barge lines filed the action of which review is presently sought, in the District Court for the Eastern District of Missouri. The complaint was based in part on the statutory procedure for review of Interstate Commerce Commission orders, and it prayed the court to set aside Order 19059 on the ground that the Commission lacked power to grant Fourth Section relief as to protested tariffs without first completing a full investigation, holding an adversary hearing, and making explicit findings that the statutory criteria for the granting of such relief had been met. The complaint also sought relief under the Declaratory Judgments Act and under the judicial review provisions of the Administrative Procedure Act; the complaint alleged that the challenged administrative practice was a continuing one, and prayed for a declaration that that practice was beyond the powers of the Commission.

Pending the determination of the action, the railroads eliminated the long-haul short-haul discrimination from their rates and notified the Commission by letter of their withdrawal of the Fourth Section application respecting which Order 19059 had granted temporary relief. Having intervened as defendants in the pending lawsuit, the railroads, together with the Commission, then moved for dismissal of the action on the grounds, first, that as to the prayer for annulment of Order 19059 the withdrawal of the Fourth Section application had rendered the cause moot; and, second, that the District Court lacked jurisdiction to grant a declaratory judgment. The District Court granted the motions to dismiss. 188 F.Supp. 386. The barge lines then perfected this appeal under 28 U.S.C. § 1253, 28 U.S.C.A. § 1253, and we postponed decision as to our jurisdiction until hearing on the merits. 365 U.S. 865, 81 S.Ct. 901, 5 L.Ed.2d 857.

We are, of course, in any event empowered and obliged to determine the jurisdictional questions in deciding whether the District Court correctly dismissed the case. And that is necessarily our initial inquiry on this appeal. Appellants do not deny that Order 19059 is presently devoid of practical effect, inasmuch as the Fourth Section application to which it relates has been withdrawn. Still, they insist that the case is neither moot nor inappropriate for the granting of declaratory relief.

First, appellants assert in their brief that they 'have a continuing interest in having F.S.O. 19059 vacated since it would be a defense to any action by appellants against the railroads for damages suffered from the railroads' fourth section departure rates.' Appellants point, in this connection, to certain of our decisions which suggest to them that they will be precluded from attacking Order 19059 collaterally and that the order must be set aside, if at all, by statutory direct review.

In United States v. Munsingwear, Inc., 340 U.S. 36, 71 S.Ct. 104, 95 L.Ed. 36, this Court expressed the view that a party should not be concluded in subsequent litigation by a District Court's resolution of issues, when appellate review of the judgment incorporating that resolution, otherwise available as of right, fails because of intervening mootness. We there held that that principle should be implemented by the reviewing court's vacating the unreviewed judgment below. We think the principle enunciated in Munsingwear at least equally applicable to unreviewed administrative orders, and we adopt its procedure here. The District Court should have vacated the order which it declined to review. Since our disposition rests solely on the mootness occasioned by the railroads' elimination of the long-haul short-haul discrimination, it is not to be taken as foreclosing determination, on any appropriate future occasion, as to (a) whether the Commission was empowered to enter Order 19059 utilizing the procedures it did; (b) whether Order 19059 was effective to authorize the Fourth Section departures to which it related; or (c) whether the pendency of Order 19059 establishes a defense for the railroads if the appellants carry out their intention expressed to us to predicate a damage suit against the railroads on the alleged violation of the statute. Of course, we here intimate no view as to whether there may exist a cause of action for damages in favor of a competing carrier predicated on a Fourth Section departure.

Second, appellants assert in their brief that since 'the * *  * practice of the Commission in granting 'temporary' authority for Fourth Section departures to the Railroads over the protests of the appellants and without any hearing or findings in the order granting such authority' is a 'continuing' one, there is presently an actual controversy within the jurisdiction of the Court to resolve by declaratory judgment.

We think it significant on this aspect of the case that the Commission has, on this appeal, conceded that it is obliged to make findings and that the challenged order is fatally defective because no supporting findings were made. The Commission further represents that it has amended its practice accordingly. It thus appears that one of the 'continuing' practices whose validity appellants would have us adjudicate continues no longer. Nor would it be appropriate to decide at this juncture whether the Commission is required to hold an evidentiary hearing prior to granting 'temporary Fourth Section relief.' Despite the Commission's present insistence that it is not so required, experience with its newly adopted practice of making findings in respect of all protested Fourth Section Orders may lead the Commission to provide for a hearing-at least under some circumstances.

Declaratory judgment is a remedy committed to judicial discretion. Nor need this Court first have the view of a lower court before it may decide that such discretion ought not be exercised. Public Service Commission of Utah v. Wycoff Co., 344 U.S. 237, 73 S.Ct. 236, 97 L.Ed. 291. We think that sound discretion withholds the remedy where it appears that a challenged 'continuing practice' is, at the moment adjudication is sought, undergoing significant modification so that its ultimate form cannot be confidently predicted. We do not, therefore, reach the possibly difficult questions whether appellants' challenge to the Commission's 'continuing practice' gives rise to an actual controversy, or whether the District Court was on these pleadings otherwise possessed of jurisdiction to render a declaratory judgment.

The order of the District Court dismissing the complaint is modified to provide that the proceedings are remanded to the Interstate Commerce Commission with direction to vacate and set aside Order 19059. It is so ordered.

Order modified.

Mr. Justice CLARK, with whom THE CHIEF JUSTICE, Mr. Justice BLACK and Mr. Justice DOUGLAS join, dissenting.