B-5668, OCTOBER 26, 1939, 19 COMP. GEN. 453

B-5668: Oct 26, 1939

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BITUMINOUS COAL ACT OF 1937 - PRICE-FIXING ORDERS - EFFECT ON GOVERNMENT CONTRACTS THE GOVERNMENT IS NOT AFFECTED BY STATUTORY PROVISIONS UNLESS EXPRESSLY NAMED OR INCLUDED BY NECESSARY IMPLICATION. THE QUESTION WHETHER GOVERNMENT PURCHASING AGENTS MAY BE AUTHORIZED OR REQUIRED TO REJECT BIDS SUBMITTED BY COAL PRODUCERS WHO ARE MEMBERS OF THE BITUMINOUS COAL CODE PROMULGATED UNDER THE BITUMINOUS COAL ACT OF 1937. IS TOO DOUBTFUL TO WARRANT EITHER THE ACCOUNTING OR ADMINISTRATIVE OFFICERS OF THE GOVERNMENT FORECLOSING ITS RIGHT TO OBTAIN COAL ON THE BEST TERMS AVAILABLE IN THE ABSENCE OF A STATUTE CLEARLY SO PROVIDING OR OF A FINAL JUDICIAL DETERMINATION. THE PROVISIONS OF SECTION 4 (E) OF THE ACT IN WHICH THE UNITED STATES IS NOT NAMED.

B-5668, OCTOBER 26, 1939, 19 COMP. GEN. 453

BITUMINOUS COAL ACT OF 1937 - PRICE-FIXING ORDERS - EFFECT ON GOVERNMENT CONTRACTS THE GOVERNMENT IS NOT AFFECTED BY STATUTORY PROVISIONS UNLESS EXPRESSLY NAMED OR INCLUDED BY NECESSARY IMPLICATION, PARTICULARLY WHERE THE EFFECT WOULD BE TO RESTRICT OR DEPRIVE IT OF EXISTING RIGHTS OR INTERESTS. THE QUESTION WHETHER GOVERNMENT PURCHASING AGENTS MAY BE AUTHORIZED OR REQUIRED TO REJECT BIDS SUBMITTED BY COAL PRODUCERS WHO ARE MEMBERS OF THE BITUMINOUS COAL CODE PROMULGATED UNDER THE BITUMINOUS COAL ACT OF 1937, 50 STAT. 72, FOR FURNISHING THE GOVERNMENT BITUMINOUS COAL AT PRICES BELOW THE MINIMUM PRICES WHICH MAY BE ESTABLISHED PURSUANT TO THE SAID ACT, IS TOO DOUBTFUL TO WARRANT EITHER THE ACCOUNTING OR ADMINISTRATIVE OFFICERS OF THE GOVERNMENT FORECLOSING ITS RIGHT TO OBTAIN COAL ON THE BEST TERMS AVAILABLE IN THE ABSENCE OF A STATUTE CLEARLY SO PROVIDING OR OF A FINAL JUDICIAL DETERMINATION, THE PROVISIONS OF SECTION 4 (E) OF THE ACT IN WHICH THE UNITED STATES IS NOT NAMED, OR INCLUDED BY NECESSARY IMPLICATION, WHILE BROAD AND GENERAL, BEING INSUFFICIENT TO WARRANT THE CONCLUSION THAT THE CONGRESS INTENDED TO INCLUDE THE GOVERNMENT AND THEREBY ABROGATE ITS RIGHT TO BUY COAL AT THE LOWEST AVAILABLE PRICES. IF IT SHOULD BE DETERMINED THAT THE BITUMINOUS COAL ACT OF 1937, 50 STAT. 72, FORBIDS COAL CODE MEMBERS FROM SELLING BITUMINOUS COAL TO THE UNITED STATES AT LESS THAN CODE MINIMUM PRICES AND RENDERS UNENFORCEABLE SUCH SALE CONTRACTS, IT STILL WOULD BE NO PART OF THE DUTY OF GOVERNMENT PURCHASING AGENCIES TO PREDETERMINE THE MATTER BY THE REJECTION OF A BID ASSUMED TO BE IN VIOLATION OF THE CODE, AND THUS TO FORECLOSE THE BIDDER'S OPPORTUNITY TO HAVE ALL QUESTIONS INVOLVED FINALLY ADJUDICATED, THE BURDEN OF COMPLIANCE WITH THE CODE BEING ON THE CONTRACTORS AND NOT ON THE GOVERNMENT OR ITS PURCHASING AGENTS.

COMPTROLLER GENERAL BROWN TO THE SECRETARY OF THE INTERIOR, OCTOBER 26, 1939:

YOUR LETTER OF AUGUST 21, 1939, SUBMITS FOR DECISION THE QUESTION OF WHETHER GOVERNMENT PURCHASING AGENTS MAY BE AUTHORIZED OR REQUIRED TO REJECT BIDS BY CODE MEMBERS FOR FURNISHING THE GOVERNMENT BITUMINOUS COAL AT PRICES BELOW THE MINIMUM PRICES WHICH MAY BE ESTABLISHED PURSUANT TO THE BITUMINOUS COAL ACT OF 1937, 50 STAT. 72. THE LETTER IS AS FOLLOWS:

THE BITUMINOUS COAL DIVISION OF THE UNITED STATES DEPARTMENT OF THE INTERIOR IS NOW ENGAGED IN PROCEEDINGS WHICH ARE EXPECTED TO CULMINATE IN DUE COURSE IN THE ESTABLISHMENT OF EFFECTIVE MINIMUM PRICES GOVERNING THE SALE AND DISTRIBUTION OF BITUMINOUS COAL BY PRODUCERS WHO ACCEPT OR HAVE ACCEPTED MEMBERSHIP IN THE BITUMINOUS COAL CODE, PROMULGATED BY THE NATIONAL BITUMINOUS COAL COMMISSION ON JUNE 21, 1937, PURSUANT TO THE AUTHORITY OF THE BITUMINOUS COAL ACT OF 1937. IN CONTEMPLATION OF THE ESTABLISHMENT OF SUCH MINIMUM PRICES, THIS DIVISION CONSIDERS IT DESIRABLE TO OBTAIN A RULING FROM THE COMPTROLLER GENERAL CONCERNING THE RIGHT OF DEPARTMENTS AND AGENCIES OF THE FEDERAL GOVERNMENT TO REJECT BIDS FOR THE SALE AND DELIVERY OF BITUMINOUS COAL AT PRICES WHICH ARE BELOW THOSE ESTABLISHED BY THE DIVISION.

THE BITUMINOUS COAL ACT OF 1937 (AS MODIFIED BY THE REORGANIZATION ACT OF 1939, REORGANIZATION PLAN NO. II TRANSMITTED BY THE PRESIDENT THEREUNDER, AND ORDERS NO. 1394 AND 1399 OF THE DEPARTMENT OF THE INTERIOR) AUTHORIZES THE BITUMINOUS COAL DIVISION OF THE DEPARTMENT OF THE INTERIOR TO ESTABLISH EFFECTIVE MINIMUM PRICES GOVERNING THE SALE AND DELIVERY OF BITUMINOUS COAL THROUGHOUT THE UNITED STATES. SUCH PRICES BECOME BINDING UPON ALL PRODUCERS OF BITUMINOUS COAL IN THE UNITED STATES (INCLUDING THE TERRITORY OF ALASKA) WHO ACCEPT MEMBERSHIP IN THE BITUMINOUS COAL CODE. TO DATE, 14,131 PRODUCERS, REPRESENTING MORE THAN 95 PERCENT OF THE TOTAL BITUMINOUS COAL PRODUCTION IN THE COUNTRY, HAVE ACCEPTED SUCH CODE MEMBERSHIP, AND OF THIS NUMBER, 11,841, REPRESENTING ALMOST 90 PERCENT OF THE TOTAL TONNAGE, ARE STILL ACTIVE.

ONCE EFFECTIVE MINIMUM PRICES ARE ESTABLISHED BY THE DIVISION, THE COAL ACT MAKES INVALID AND UNENFORCEABLE ANY CONTRACT FOR THE SALE OF COAL AT A PRICE BELOW THE APPLICABLE MINIMUM PRICES ( SECTION 4, PART II SUBSECTION (E) ):

"NO COAL SUBJECT TO THE PROVISIONS OF THIS SECTION SHALL BE SOLD OR DELIVERED OR OFFERED FOR SALE AT A PRICE BELOW THE MINIMUM OR ABOVE THE MAXIMUM THEREFOR ESTABLISHED BY THE COMMISSION, AND THE SALE OR DELIVERY OR OFFER FOR SALE OF COAL AT A PRICE BELOW SUCH MINIMUM OR ABOVE SUCH MAXIMUM SHALL CONSTITUTE A VIOLATION OF THE CODE: PROVIDED, THAT THE PROVISIONS OF THIS PARAGRAPH SHALL NOT APPLY TO A LAWFUL AND BONA FIDE WRITTEN CONTRACT ENTERED INTO PRIOR TO JUNE 16, 1933.

"THE MAKING OF A CONTRACT FOR THE SALE OF COAL AT A PRICE BELOW THE MINIMUM OR ABOVE THE MAXIMUM THEREFOR ESTABLISHED BY THE COMMISSION AT THE TIME OF THE MAKING OF THE CONTRACT SHALL CONSTITUTE A VIOLATION OF THE CODE, AND SUCH CONTRACT SHALL BE INVALID AND UNENFORCEABLE.'

THAT THESE GENERAL PROVISIONS APPLY TO THE SALE OF COAL TO THE UNITED STATES IS CLEAR. ONE INDICATION OF THIS IS TO BE FOUND IN THE PROVISIONS OF SECTION 3 OF THE COAL ACT, SUBSECTION (A) OF WHICH IMPOSES AN EXCISE TAX "UPON THE SALE OR OTHER DISPOSAL OF BITUMINOUS COAL PRODUCED WITHIN THE UNITED STATES," AND SUBSECTION (E) OF WHICH EXEMPTS FROM THIS TAX SALES OF COAL "FOR THE EXCLUSIVE USE OF THE UNITED STATES * * * FOR USE IN THE PERFORMANCE OF GOVERNMENTAL CTIONS.' (IT WILL BE NOTED THAT THERE IS NO SIMILAR EXEMPTION FROM THE EXCISE TAX IMPOSED BY SECTION 3 (B) UPON SALES BY PRODUCERS WHO ARE NOT CODE MEMBERS.) THE EXISTENCE OF THE EXPRESS EXEMPTION IN SECTION 3 (E) DEMONSTRATES THAT THE PROVISIONS IMPOSING THE EXCISE TAX UPON SALES OF COAL IN GENERAL WOULD OTHERWISE HAVE APPLIED TO SALES TO THE UNITED STATES; AND THE SAME INTERPRETATION WOULD HOLD TRUE OF THE PROVISIONS IN THE COAL ACT PROVIDING FOR THE ESTABLISHMENT OF MINIMUM PRICES GOVERNING SALES IN GENERAL.

AN ADDITIONAL INDICATION THAT THE REGULATORY PROVISIONS OF THE COAL ACT WERE INTENDED TO APPLY TO SALES TO THE UNITED STATES IS FURNISHED BY SECTION 9 (B), PROHIBITING THE PURCHASE OF COAL "BY THE UNITED STATES OR BY ANY DEPARTMENT OR AGENCY THEREOF, PRODUCED AT ANY MINE WHERE THE PRODUCER FAILED AT THE TIME OF PRODUCTION OF SUCH COAL TO ACCORD TO HIS OR ITS EMPLOYEES THE RIGHTS" OF COLLECTIVE BARGAINING FREE FROM RESTRAINT OR INTERFERENCE, AS GUARANTEED BY SECTION 9 (A).

FOR THESE REASONS, AND IN VIEW OF THE EXPRESS INVALIDATION BY SECTION 4 II (E) OF ANY CONTRACT ,FOR THE SALE OF COAL AT A PRICE BELOW THE MINIMUM * * * THEREFOR ESTABLISHED" BY THE DIVISION, IT IS CLEAR THAT NO FEDERAL DEPARTMENT OR AGENCY SHOULD AWARD A COAL PURCHASE CONTRACT TO A CODE MEMBER WHOSE BID PRICE VIOLATES THE EFFECTIVE MINIMUM PRICE SCHEDULE. SINCE THE RESULTANT CONTRACT WOULD BE INVALID AND UNENFORCEABLE, THE BIDDER MIGHT WITH IMPUNITY REFUSE TO PROCEED AT ANY TIME WITH THE PERFORMANCE OF THE CONTRACT, AND THE GOVERNMENT WOULD IN ALL PROBABILITY HAVE NO RIGHT TO RECOVER DAMAGES. IN THESE CIRCUMSTANCES, AN AWARD WOULD PATENTLY BE A VAIN AND POSSIBLY TROUBLESOME ACT.

THIS DIVISION IS PREPARED TO COOPERATE WITH THE PROCUREMENT DIVISION OF THE TREASURY DEPARTMENT, AND WITH SUCH OTHER FEDERAL DEPARTMENTS AND AGENCIES AS ARE AUTHORIZED TO CONTRACT FOR THE PURCHASE OF BITUMINOUS COAL, WITH A VIEW TOWARDS PROMULGATING AN EFFICIENT PROCEDURE FOR ACQUIRING COAL AT THE BEST PRICES AND UNDER THE MOST SATISFACTORY CONDITIONS, WHILE AT THE SAME TIME OBSERVING THE REQUIREMENTS OF SECTION 4 II (E) OF THE COAL ACT. IT IS THOUGHT THAT IN THE STANDARD FORM OF INSTRUCTIONS TO BIDDERS, FOR USE IN INVITATIONS FOR BIDS FOR THE FURNISHING OF BITUMINOUS COAL TO THE UNITED STATES GOVERNMENT, A PROVISION MIGHT BE INSERTED SUBSTANTIALLY AS FOLLOWS:

"A BID OFFERING COAL AT A PRICE (EXCLUSIVE OF THE EXCISE TAX OF ONE CENT PER TON OF 2,000 POUNDS IMPOSED BY SECTION 3 (A) OF THE BITUMINOUS COAL ACT OF 1937) WHICH IS LESS THAN THE MINIMUM PRICE (LESS THE AFORESAID EXCISE TAX) ESTABLISHED FOR SUCH COAL BY THE BITUMINOUS COAL DIVISION OF THE UNITED STATES DEPARTMENT OF THE INTERIOR SHALL BE REJECTED, IF THE BIDDER IS A MEMBER OF THE BITUMINOUS COAL CODE PROMULGATED PURSUANT TO SECTION 4 OF THE AFORESAID ACT.'

THE DIVISION INTENDS TO FACILITATE TO EVERY POSSIBLE EXTENT THE MAKING OF DETERMINATIONS BY THE AWARDING AGENCY AS TO WHETHER A BID DOES NOT EXCEED THE APPLICABLE MINIMUM PRICE SCHEDULE, AND HENCE WHETHER A CONTRACT BASED UPON SUCH A BID WOULD BE VALID UNDER SECTION 4 II (E) OF THE COAL ACT. BESIDES MAKING AVAILABLE LISTS OF CODE MEMBERS AND SCHEDULES OF EFFECTIVE PRICES, AND KEEPING THE SAME UP-TO-DATE AT ALL TIMES, THIS DIVISION COULD OFFER TO THE AWARDING AGENCIES THE SERVICES OF ITS BRANCH OFFICES THROUGHOUT THE COUNTRY FOR THE PURPOSE OF RENDERING INTERPRETATIONS AND RULINGS AS TO THE APPLICATION OF THE PRICE SCHEDULES TO A GIVEN SITUATION.

THE NECESSITY FOR A PROCEDURE SUCH AS IS OUTLINED ABOVE IS VERY PLAIN. THE UNITED STATES GOVERNMENT PURCHASES APPROXIMATELY 3,000,000 TONS OF BITUMINOUS COAL ANNUALLY FOR ITS USE; AND UNLESS THE BIDS OF CODE MEMBERS AT PRICES BELOW THE EFFECTIVE MINIMUM PRICES ARE REJECTED, CONSIDERABLE DAMAGE MAY BE DONE TO THE PRODUCERS WHO COMPLY WITH THE REQUIREMENTS OF THE ACT AND THE CODE. IT IS TRUE THAT A VIOLATION OF PRICE SCHEDULES ESTABLISHED BY THIS DIVISION COULD FORM THE BASIS FOR ADMINISTRATIVE PROCEEDINGS LEADING TO REVOCATION OF THE CODE MEMBERSHIP OR TO A CEASE AND DESIST ORDER; YET NEITHER OF SUCH ALTERNATIVES COULD ENTIRELY RECTIFY THE HARM WHICH A DELINQUENT CODE MEMBER WOULD HAVE CAUSED TO HIS COMPETITORS BY UNDERBIDDING THEM AND CAUSING THEM TO LOSE THE AWARD. NOR WOULD IT ELIMINATE THE INCONVENIENCE AND DELAY TO THE AWARDING AND CONSUMING FEDERAL AGENCIES WHICH MIGHT BE CAUSED BY TERMINATION OF THE COAL PURCHASE CONTRACT. IN THESE CIRCUMSTANCES, THIS DIVISION CONSIDERS THAT THE MOST EFFECTIVE AND MOST EXPEDITIOUS MANNER OF ENFORCING SECTION 4 II (E) IS THE REJECTION BY FEDERAL CONTRACTING AGENCIES OF ANY BID BY A CODE MEMBER WHICH DOES NOT CONFORM TO THE APPLICABLE PRICE SCHEDULES ESTABLISHED BY THIS DIVISION.

HOWEVER, BEFORE PREPARING THE NECESSARY RULES AND THE PROPER PROCEDURE, IT IS DESIRED THAT AN EXPRESSION BE OBTAINED AS TO WHETHER THE FOREGOING ANALYSIS OF SECTION 4 II (E) IS IN ACCORD WITH YOUR VIEWS, AND WHETHER FEDERAL AWARDING AGENCIES MAY PROPERLY REJECT BIDS FOR THE SUPPLY OF COAL AT PRICES WHICH ARE BELOW THE EFFECTIVE PRICES ESTABLISHED BY THIS DIVISION. ATTENTION IS INVITED IN THIS CONNECTION TO DECISION NO. A-93313 RENDERED TO THE SECRETARY OF THE INTERIOR BY ACTING COMPTROLLER GENERAL ELLIOTT ON MARCH 22, 1938, AND REPORTED IN 17 COMP. GEN. 770. ALTHOUGH THE RESULT REACHED IN THAT DECISION IS IN NO WAY INCONSISTENT WITH THE ANALYSIS SET FORTH ABOVE, A STATEMENT MADE IN THE BODY OF THE DECISION PURELY BY WAY OF OBITER DICTUM IS, IN THE OPINION OF THIS DIVISION, NOT JUSTIFIED BY THE COAL ACT NOR BY ANY OTHER PROVISION OF LAW.

IN THE CASE CITED, BIDS FOR THE SALE AND DELIVERY OF COAL WERE OPENED AT THE BUREAU OF MINES EXPERIMENT STATION, IN PITTSBURGH, PA. ONE PROPOSAL WAS AT A PRICE HIGHER THAN THE LOWEST BID, BUT WAS COUPLED WITH A DISCOUNT FOR PROMPT PAYMENT THAT WOULD MAKE SUCH BID THE LOWEST. INQUIRY FROM THE PITTSBURGH OFFICE OF THE NATIONAL BITUMINOUS COAL COMMISSION (THE PREDECESSOR OF THIS DIVISION) DISCLOSED THAT THE USE OF DISCOUNTS WOULD VIOLATE THE MARKETING RULES AND REGULATIONS WHICH HAD BEEN PROMULGATED BY THE COMMISSION, AND WHICH WERE STILL IN EFFECT AT THAT TIME. ACCORDINGLY, ALL DISCOUNTS WERE DISREGARDED BY THE BUREAU OF MINES, AND THE CONTRACT WAS AWARDED TO THE LOWEST BIDDER. A FEW DAYS LATER, THE MARKETING RULES AND REGULATIONS IN QUESTION WERE REVOKED BY THE COMMISSION, BUT THE COMMISSION RULED THAT THESE HAD REMAINED EFFECTIVE UNTIL REVOCATION. THE MEANTIME, THE BIDDER WHO HAD OFFERED THE HIGHEST DISCOUNT PROTESTED AGAINST THE AWARD IN DISREGARD OF THE DISCOUNTS, AND THIS PROTEST WAS REFERRED TO THE GENERAL ACCOUNTING OFFICE.

ACTING COMPTROLLER GENERAL ELLIOTT POINTED OUT THAT THE DISCOUNT IN QUESTION WOULD NOT HAVE BROUGHT THE MINE PRICE OF THE COAL BELOW THE EFFECTIVE MINIMUM PRICES, AND THAT THESE PRICES WERE RESCINDED ONLY AFTER THE CONTRACT HAD BEEN ENTERED INTO. THE ACTING COMPTROLLER GENERAL THEN STATED:

"NEITHER THE ACT OF APRIL 26, 1937, NOR THE ABOVE REFERRED TO RULES OF THE NATIONAL BITUMINOUS COAL COMMISSION, PROHIBIT THE GIVING OF DISCOUNT TO THE UNITED STATES FOR PROMPT PAYMENT SO LONG AS THE AMOUNT OF DISCOUNT WAS NOT SUFFICIENT TO BRING THE NET PRICE OF THE COAL BELOW THE MINIMUM PRICE ESTABLISHED BY THE NATIONAL BITUMINOUS COAL COMMISSION.'

PLAINLY, THERE IS NOTHING IN THIS DECISION WHICH IS INCONSISTENT WITH THE ANALYSIS OF SECTION 4 II (E) OF THE ACT ADOPTED BY THIS DIVISION. SINCE THE ACT DOES NOT MAKE INVALID AND UNENFORCEABLE CONTRACTS WHICH VIOLATE THE MARKETING RULES AND REGULATIONS, AN OTHERWISE PROPER BID SHOULD NOT BE REJECTED BECAUSE OF SUCH A VIOLATION. THE SITUATION IS OBVIOUSLY ENTIRELY DIFFERENT WITH RESPECT TO CONTRACTS WHICH VIOLATE THE EFFECTIVE MINIMUM PRICES, IN VIEW OF THE EXPRESS PROVISION IN THE ACT MAKING SUCH CONTRACTS VALID AND UNENFORCEABLE.

HOWEVER, THE ACTING COMPTROLLER GENERAL PROCEEDED TO STATE, BY WAY OF OBITER DICTUM (17 COMP. GEN. 772):

"FURTHERMORE, THERE IS NO DUTY ON THE PURCHASING AGENCIES OF THE GOVERNMENT TO ASCERTAIN WHETHER THE PRICES AT WHICH COAL IS OFFERED ARE BELOW THOSE FIXED UNDER AUTHORITY OF THE BITUMINOUS COAL ACT, AND THERE IS NO AUTHORITY IN ANY CONTRACTING OFFICER OF THE GOVERNMENT TO REJECT A BID MERELY BECAUSE THE PRICE OR DISCOUNT OFFERED MAY CONTRAVENE SOME CODE OR REGULATION UNDER THE SAID ACT.'

IT IS RESPECTFULLY SUBMITTED THAT THE FOREGOING STATEMENT WAS NOT NECESSARY TO THE DECISION OF THE QUESTION THERE INVOLVED, AND IS NOT SUPPORTED BY THE PROVISIONS OF THE ACT, AND THEREFORE SHOULD NOT BE REGARDED AS AN AUTHORITY RELEVANT TO THE SITUATION AT PRESENT UNDER DISCUSSION. UNDER SECTION 4 II (E), CONTRACTS FOR THE SALE OF COAL AT PRICES BELOW THE ESTABLISHED MINIMUM ARE EXPRESSLY MADE "INVALID AND UNENFORCEABLE; " AND IT IS HARDLY OPEN TO ARGUMENT THAT A FEDERAL AGENCY MAY DECLINE TO ACCEPT A BID WHICH, ALTHOUGH THE LOWEST SUBMITTED, WOULD NOT RESULT IN A BINDING OR ENFORCEABLE CONTRACT. IT IS THEREFORE THE OPINION OF THIS DIVISION THAT THE OBITER DICTUM CITED ABOVE SHOULD EXPRESSLY BE RECOGNIZED AS IN NO WAY PRECLUDING FEDERAL PURCHASING AGENCIES FROM REJECTING BIDS FOR THE SALE OF COAL WHICH COULD NOT FORM THE BASIS FOR A VALID CONTRACT BECAUSE OF THE OPERATION OF SECTION 4 II (E). INDEED, ANY OTHER POSITION WOULD ENABLE ONE FEDERAL OFFICE TO PARTICIPATE IN THE VIOLATION BY A PRODUCER OF AN ACT OF CONGRESS ADMINISTERED BY ANOTHER FEDERAL OFFICE. IF THE DICTUM IN 17 COMP. GEN. 770, 772, IS CLARIFIED OR DISAVOWED AS AN APPLICABLE AUTHORITY, ANY OBSTACLE IN THE PRECEDENTS TO THE PROCEDURE PROPOSED ABOVE WOULD BE REMOVED, INCLUDING LETTER A-94218 OF MAY 27, 1938, FROM ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF THE TREASURY. THAT LETTER ADVERTED TO THE REJECTION BY THE PROCUREMENT DIVISION OF CERTAIN BIDS FOR THE FURNISHING OF BITUMINOUS COAL ON THE GROUND THAT THE PRICES QUOTED WERE LOWER THAN THOSE PRESCRIBED BY THE NATIONAL BITUMINOUS COAL COMMISSION. THE ACTING COMPTROLLER GENERAL CITED THE DICTUM HEREINABOVE REFERRED TO, AND STATED: "THE DECISIONS OF THIS OFFICE ARE TO THE EFFECT THAT AS THE PROVISIONS OF SECTION 3709, REVISED STATUTES, CONTEMPLATE THAT PURCHASES FOR THE GOVERNMENT SHALL BE MADE AT THE LOWEST PRICE OBTAINABLE, CONSISTENT WITH THE ACTUAL NEEDS DISCLOSED, APPROPRIATED MONEYS ARE NOT AVAILABLE FOR PAYMENTS IN CONNECTION WITH CONTRACTS AWARDED TO OTHER THAN THE LOWEST BIDDERS UNDER ADVERTISED SPECIFICATIONS FOR THE SUPPLIES.'

THIS LETTER WAS, HOWEVER, NOT AN OUTRIGHT DECISION, BUT MERELY BROUGHT THE MATTER TO THE ATTENTION OF THE SECRETARY OF THE TREASURY "FOR SUCH ADMINISTRATIVE ACTION AS MAY BE APPROPRIATE.' IF THE DICTUM IN 17 COMP. GEN. 770 IS CLARIFIED OR DISAVOWED, LETTER A-94218 COULD STILL BE JUSTIFIED ON THE GROUND THAT THE INJUNCTION WHICH HAD BEEN ISSUED BY SEVERAL COURTS AGAINST THE MINIMUM PRICE ORDERS OF THE COMMISSION, AND THE REVOCATION OF SUCH ORDERS BY THE COMMISSION, JUSTIFIED THE "APPROPRIATE ADMINISTRATIVE ACTION" INDICATED BY THE ACTING COMPTROLLER GENERAL.

IN VIEW OF THE FACT THAT EFFECTIVE MINIMUM PRICE SCHEDULES ARE EXPECTED SOON TO BE ESTABLISHED, IT IS RESPECTFULLY REQUESTED THAT THE BENEFIT OF YOUR VIEWS ON THE ABOVE MATTER BE FURNISHED AS EARLY AS POSSIBLE, SPECIFICALLY WHETHER YOU AGREE WITH THIS DIVISION THAT SECTION 4 II (E) OF THE COAL ACT JUSTIFIED THE REJECTION BY FEDERAL PURCHASING AGENCIES OF BIDS FOR FURNISHING BITUMINOUS COAL AT PRICES WHICH, ALTHOUGH LOWEST, COULD NOT FORM THE BASIS OF A VALID OR ENFORCEABLE SALES CONTRACT UNDER THE BITUMINOUS COAL ACT OF 1937.

THE MATTERS INVOLVED HAVE BEEN GIVEN CAREFUL CONSIDERATION, BUT IT IS CONCLUDED THAT THE QUESTION ADMITS OF TOO MUCH DOUBT TO WARRANT EITHER THE ACCOUNTING OR ADMINISTRATIVE OFFICERS FORECLOSING THE RIGHT OF THE GOVERNMENT TO OBTAIN THE COAL NEEDED IN THE PERFORMANCE OF ITS FUNCTIONS ON THE BEST TERMS AVAILABLE, IN THE ABSENCE OF A STATUTE CLEARLY SO PROVIDING OR OF A FINAL JUDICIAL DETERMINATION THAT CODE MEMBER CONTRACTS WITH THE GOVERNMENT AT LESS THAN CODE MINIMUM PRICES ARE PROHIBITED BY THE BITUMINOUS COAL ACT.

IN PURCHASING SOME 3 MILLION TONS OF BITUMINOUS COAL A YEAR, THE DIFFERENCE BETWEEN MINIMUM CODE PRICES FIXED GENERALLY FOR A PRODUCING AREA AND THE PRICES AT WHICH INDIVIDUAL PRODUCERS MAY BE ABLE AND WILLING TO SELL COAL TO THE GOVERNMENT MAY AMOUNT TO MANY MILLIONS OF DOLLARS OVER THE PERIOD THE ACT MAY BE KEPT IN EFFECT, AND IT IS NOT TO BE ASSUMED THAT THE CONGRESS INTENDED TO VOTE SUCH A SUBSIDY TO GOVERNMENT COAL CONTRACTORS OR TO IMPOSE SUCH BURDEN ON GOVERNMENT FINANCES, WHERE THAT INTENTION IS NOT CLEARLY EXPRESSED OR NECESSARILY IMPLIED. IN THIS CONNECTION IT MAY BE NOTED THAT WHILE GREAT AMOUNT OF BITUMINOUS COAL PURCHASED ANNUALLY BY THE GOVERNMENT MAKES IT OBVIOUSLY IMPORTANT THAT THE BEST POSSIBLE PRICES BE OBTAINED, THE TONNAGE INVOLVED, STATED TO BE SOME 3 MILLION TONS A YEAR, REPRESENTS SOMETHING LESS THAN 1 PERCENT OF ANNUAL PRODUCTION, AND, HENCE, ITS EXCLUSION FROM THE MINIMUM-PRICE REQUIREMENTS WILL NOT MATERIALLY AFFECT THE GENERAL OPERATION OF THE ACT OR TEND TO DEFEAT ITS PURPOSES. IT FOLLOWS THAT THE SUBJECTION OF SUCH GOVERNMENT PURCHASES TO THE MINIMUM PRICE PROVISIONS IS NOT ESSENTIAL TO THE ACCOMPLISHMENT OF THE GENERAL PURPOSES OF THE LEGISLATION AND, THEREFORE, IT CANNOT BE SAID THAT SUCH INCLUSION IS REQUIRED BY NECESSARY IMPLICATION TO GIVE EFFECT TO THE STATUTE IN ANY ESSENTIAL RESPECT. SEE UNITED STATES V. HERRON, 20 WALL. 251.

AS POINTED OUT IN YOUR LETTER, SUBSECTION 3 (E) OF THE ACT EXEMPTS COAL SOLD TO THE GOVERNMENT FROM THE EXCISE TAX OF 1 CENT A TON IMPOSED BY SUBSECTION 3 (A) UPON THE SALE OR OTHER DISPOSAL OF BITUMINOUS COAL PRODUCED IN THE UNITED STATES, WHETHER BY CODE MEMBERS OR NONMEMBERS, AND SUBSECTION 9 (B) OF THE ACT PROHIBITS THE PURCHASE BY THE UNITED STATES OF COAL PRODUCED AT ANY MINE WHERE THE PRODUCER FAILED TO ACCORD TO HIS EMPLOYEES THE COLLECTIVE-BARGAINING RIGHTS SET FORTH IN SUBSECTION 9 (A). BUT IT IS NOT APPARENT HOW THESE PROVISIONS DEMONSTRATE ANY CLEAR LEGISLATIVE INTENT TO PROHIBIT CODE-MEMBER SALES TO THE GOVERNMENT AT LESS THAN CODE PRICES UNDER SECTION 4 OF THE ACT. AS AGAINST ANY SUCH DEDUCTION FROM THESE SPECIAL PROVISIONS OF AN INTENT TO SO RESTRICT AND BURDEN THE GOVERNMENT, IT IS NOT WITHOUT MATERIAL SIGNIFICANCE THAT IN ENACTING THE BITUMINOUS COAL ACT OF 1937, WHICH IS LARGELY A RECASTING AND REENACTMENT OF THE BITUMINOUS COAL ACT OF 1935, THERE WERE OMITTED THE PROVISIONS OF SECTION 14 OF THE PRIOR ACT, 49 STAT. 1006, PROHIBITING PURCHASES BY THE GOVERNMENT FROM PRODUCERS NOT COMPLYING WITH THE CODE AND REQUIRING GOVERNMENT CONTRACTORS TO PURCHASE COAL FROM CODE MEMBERS ONLY. BY THE OMISSION OF THESE PROVISIONS THE GOVERNMENT AND ITS CONTRACTORS WERE LEFT FREE TO PURCHASE COAL FROM CODE MEMBERS OR NONMEMBERS AS MIGHT PROVE MOST ADVANTAGEOUS, THE ONLY RESTRICTION BEING THAT CONTAINED IN SECTION 9 (B) OF THE NEW ACT, SUPRA, PROHIBITING GOVERNMENT PURCHASES FROM PRODUCERS NOT ACCORDING COLLECTIVE-BARGAINING RIGHTS TO THEIR EMPLOYEES. THIS DENOTES THAT THE CONGRESS DID NOT INTEND FURTHER TO LIMIT OR BURDEN THE GOVERNMENT FOR THE BENEFIT OF CODE MEMBERS, OR, AT LEAST, NO FURTHER THAN THAT INVOLVED IN EXEMPTING CODE MEMBERS FROM THE 19 1/2 PERCENT TAX IMPOSED BY SECTION 3 (B) OF THE ACT, WHICH NONMEMBERS ARE REQUIRED TO PAY ON SALES TO GOVERNMENTAL AS WELL AS NONGOVERNMENTAL PURCHASERS.

IT THUS SEEMS EVIDENT THAT IF CODE-MEMBER CONTRACTS WITH THE GOVERNMENT AT LESS THAN CODE MINIMUM PRICES ARE INTERDICTED BY THE ACT, IT IS NOT BY VIRTUE OF ANY INTENT EXPRESSED IN, OR TO BE DEDUCED FROM, OTHER PROVISIONS, BUT SOLELY BY VIRTUE OF THE EXPRESS LANGUAGE APPEARING IN SECTION 4 (E) OF THE ACT, APPLICABLE TO CODE MEMBERS ONLY, THAT---

NO COAL SUBJECT TO THE PROVISIONS OF THIS SECTION SHALL BE SOLD OR DELIVERED OR OFFERED FOR SALE AT A PRICE BELOW THE MINIMUM OR ABOVE THE MAXIMUM THEREFOR ESTABLISHED BY THE COMMISSION, * * AND THAT

THE MAKING OF A CONTRACT FOR THE SALE OF COAL AT A PRICE BELOW THE MINIMUM OR ABOVE THE MAXIMUM THEREFOR ESTABLISHED BY THE COMMISSION AT THE TIME OF THE MAKING OF THE CONTRACT SHALL CONSTITUTE A VIOLATION OF THE CODE, AND SUCH CONTRACT SHALL BE INVALID AND UNENFORCEABLE.

THIS LANGUAGE IS BROAD AND INCLUSIVE IN FORM. BUT AS AGAINST ANY CONCLUSION THAT IT WAS INTENDED TO APPLY TO THE GOVERNMENT, OR TO BURDEN THE GOVERNMENT BY PROHIBITING SALES TO, OR CONTRACTS WITH, THE GOVERNMENT AT LESS THAN CODE PRICES, STANDS THE FAMILIAR CANON OF STATUTORY INTERPRETATION THAT THE SOVEREIGN IS NOT AFFECTED UNLESS EXPRESSLY NAMED OR INCLUDED BY NECESSARY IMPLICATION IN STATUTORY PROVISIONS, PARTICULARLY WHERE THE EFFECT WOULD BE TO RESTRICT OR DEPRIVE THE SOVEREIGN OF EXISTING RIGHTS OR INTERESTS. THE HISTORY OF THIS RULE AND ITS APPLICATION IN AMERICAN JURISPRUDENCE ARE DISCUSSED IN THE OPINION OF THE CIRCUIT COURT OF APPEALS, SECOND CIRCUIT, IN IN RE TIDEWATER COAL EXCHANGE, 280 FED. 648, 650, AS FOLLOWS:

* * * IN THE INTERPRETATION OF STATUTES THE PRINCIPLE IS OLD AND WELL ESTABLISHED THAT THE CROWN IS NOT BOUND BY A STATUTE UNLESS NAMED IN IT. IT SEEMS TO REST UPON THE THEORY THAT THE LAW IS PRIMA FACIE PRESUMED TO BE MADE FOR SUBJECTS ONLY. WILLION V. BERKELEY, PLOWD. 236. IN MAXWELL ON THE INTERPRETATION OF STATUTES (5TH USED.) 220, THAT WRITER DECLARES THAT THE CROWN IS NOT REACHED, EXCEPT BY EXPRESS WORDS OR BY NECESSARY IMPLICATION, IN ANY CASE WHERE IT WOULD BE OUSTED OF AN EXISTING PREROGATIVE OR INTEREST. "WHERE," HE SAYS,"THE LANGUAGE OF THE STATUTE IN GENERAL, AND IN ITS WIDE AND NATURAL SENSE WOULD DIVEST OR TAKE AWAY ANY PREROGATIVE OR RIGHT FROM THE CROWN, IT IS CONSTRUED SO AS TO EXCLUDE THAT EFFECT. WHEN THE KING HAS ANY PREROGATIVE ESTATE, RIGHT, TITLE, OR INTEREST, HE SHALL NOT BE BARRED OF THEM BY THE GENERAL WORDS OF AN ACT OF PARLIAMENT.' SEE BACON'S ABR.' PREROGATIVE" (E) 5 (C); CO. LITT. 43B; CHIT. PREROGATIVE, 382, ASCOUGH'S CASE, COR. CAS. 526; MAGDALEN COLLEGE CASE, 11 REP. 74B.

IN ANOTHER WAY IT IS EXPRESSED BY SAYING THAT IN THE CONSTRUCTION OF GENERAL WORDS OR DUBIOUS PROVISIONS THERE IS A PRESUMPTION AGAINST ANY INTENTION TO SURRENDER PUBLIC RIGHTS, OR TO AFFECT THE GOVERNMENT. LEWIS' SUTHERLAND, STATUTORY CONSTRUCTION (2D USED.) VOL. 2, P. 931; ATTORNEY GENERAL V. DONALDSON, 10 M. AND W. 117; HUGGINS V. BAMBRIDGE, WILLES 241; STOUGHTON V. BAKER, 4 MASS. 522, 3 AM. DEC. 236; STATE V. KINNE, 41 N.H. 238.

MR. JUSTICE STORY, IN 1827, IN UNITED STATES V. GREENE, 4 MASON, 427, 26 FED. CAS. 33, NO. 15,258, HAD BEFORE HIM THE RIGHT OF THE UNITED STATES TO SUE IN THE FEDERAL COURTS ON A NOTE AS THE ENDORSEE, THE MAKER AND PAYEE BEING CITIZENS OF THE SAME STATE. THE QUESTION AROSE UNDER THE JUDICIARY ACT OF 1789, C. 20, 1 STAT. 78. SECTION 11 OF THAT ACT PROVIDED THAT NO CIVIL SUIT SHOULD BE BROUGHT IN EITHER A DISTRICT OR CIRCUIT COURT TO RECOVER ON A PROMISSORY NOTE OR OTHER CHOSE IN ACTION IN FAVOR OF AN ASSIGNEE, UNLESS SUCH SUIT MIGHT HAVE BEEN PROSECUTED IN SUCH COURT IF NO ASSIGNMENT HAD BEEN MADE, EXCEPT IN CASES OF FOREIGN BILLS OF EXCHANGE. IF THAT PROVISION APPLIED TO THE UNITED STATES, THE SUIT COULD NOT BE BROUGHT. IT WAS HELD THAT THE LANGUAGE OF SECTION 11 COULD NOT BE CONSTRUED AS APPLICABLE TO THE UNITED STATES AS THE GOVERNMENT WAS NOT EXPRESSLY NAMED; AND SECTION 9 OF THE ACT GAVE THE DISTRICT COURTS JURISDICTION OF ALL SUITS AT COMMON LAW WHERE THE UNITED STATES SUES AND THE MATTER IN CONTROVERSY AMOUNTED, EXCLUSIVE OF COSTS, TO THE SUM OR VALUE OF $100.

IN UNITED STATES V. HOAR, 2 MASON, 311, 26 FED. CAS. 329, NO. 15, 373, MR. JUSTICE STORY, IN 1821, DECLARED THAT, WHERE THE GOVERNMENT IS NOT EXPRESSLY OR BY NECESSARY IMPLICATION INCLUDED, IT OUGHT TO BE CLEAR, FROM THE NATURE OF THE MISCHIEFS TO BE REDRESSED OR THE LANGUAGE USED, THAT THE GOVERNMENT ITSELF WAS IN CONTEMPLATION OF THE LEGISLATURE, BEFORE A COURT OF LAW WOULD BE AUTHORIZED TO PUT SUCH AN INTERPRETATION UPON ANY STATUTE. HE ADDED:

"IN GENERAL, ACTS OF THE LEGISLATURE ARE MEANT TO REGULATE AND DIRECT THE ACTS AND RIGHTS OF CITIZENS; AND IN MOST CASES THE REASONING APPLICABLE TO THEM APPLIES WITH VERY DIFFERENT, AND OFTEN CONTRARY, FORCE TO THE GOVERNMENT ITSELF.'

AND SEE UNITED STATES V. HEWES, CRABBE, 307, 26 FED. CAS. 297, NO. 15359.

IN DOLLAR SAVINGS BANK V. UNITED STATES, 19 WALL. 227, 239, 22 L.ED. 80, MR. JUSTICE STRONG, SPEAKING FOR THE COURT, SAID:

"IT IS A FAMILIAR PRINCIPLE THAT THE KING IS NOT BOUND BY ANY ACT OF PARLIAMENT, UNLESS HE BE NAMED THEREIN BY SPECIAL AND PARTICULAR WORDS. THE MOST GENERAL WORDS THAT CAN BE DEVISED (FOR EXAMPLE, ANY PERSON OR PERSONS, BODIES POLITIC OR CORPORATE) AFFECT NOT HIM IN THE LEAST, IF THEY MAY TEND TO RESTRAIN OR DIMINISH ANY OF HIS RIGHTS AND INTERESTS. HE MAY EVEN TAKE THE BENEFIT OF ANY PARTICULAR ACT, THOUGH NOT NAMED. THE RULE THUS SETTLED RESPECTING THE BRITISH CROWN IS EQUALLY APPLICABLE TO THIS GOVERNMENT, AND IT HAS BEEN APPLIED FREQUENTLY IN THE DIFFERENT STATES, AND PRACTICALLY IN THE FEDERAL COURTS. IT MAY BE CONSIDERED AS SETTLED THAT SO MUCH OF THE ROYAL PREROGATIVES AS BELONGED TO THE KING IN HIS CAPACITY OF PARENS PATRIAE, OR UNIVERSAL TRUSTEE, ENTERS AS MUCH INTO OUR POLITICAL STATUS AS IT DOES INTO THE PRINCIPLE OF THE BRITISH CONSTITUTION.'

IN UNITED STATES V. HERRON, 20 WALL. 251, 255, 22 L.ED. 275, THAT COURT, AGAIN REFERRING TO THE SUBJECT, SAID, SPEAKING THROUGH MR. JUSTICE CLIFFORD:

"ACTS OF PARLIAMENT, SAYS CHITTY, WHICH WOULD DIVEST OR ABRIDGE THE KING OF HIS PREROGATIVES, HIS INTEREST, OR HIS REMEDIES IN THE SLIGHTEST DEGREE, DO NOT IN GENERAL EXTEND TO OR BIND THE KING, UNLESS THERE BE EXPRESS WORDS TO THAT EFFECT. THEREFORE, SAYS THE SAME LEARNED AUTHOR, THE STATUTES OF LIMITATION, BANKRUPTCY, INSOLVENCY, SET-OFF, ETC., ARE IRRELEVANT IN THE CASE OF THE KING, NOR DOES THE STATUTE OF FRAUDS RELATE TO HIM, WHICH LAST PROPOSITION IS DOUBTED BY HIGH AUTHORITY. EXCEPTIONS EXIST TO THAT RULE UNDOUBTEDLY, AS WHERE THE STATUTE IS PASSED FOR THE GENERAL ADVANCEMENT OF LEARNING, MORALITY, AND JUSTICE, OR TO PREVENT FRAUD, INJURY, AND WRONG, OR WHERE AN ACT OF PARLIAMENT GIVES A NEW ESTATE OR RIGHT TO THE KING, AS IN THAT CASE IT WILL BIND HIM AS TO THE MANNER OF ENJOYING OR USING THE ESTATE OR RIGHT AS WELL AS THE SUBJECT.'

AND IN A SUBSEQUENT PORTION OF THE OPINION, AGAIN RECURRING TO THE SUBJECT (20 WALL. 262, 22 L.ED. 275), MR. JUSTICE CLIFFORD SAID:

"GREATER UNANIMITY OF DECISION IN THE COURTS OR OF VIEWS AMONG TEXT- WRITERS CAN HARDLY BE FOUND UPON ANY IMPORTANT QUESTION THAN EXISTS IN RESPECT TO THIS QUESTION IN THE PARENT COUNTRY, NOR IS THERE ANY DIVERSITY OF SENTIMENT IN OUR COURTS, FEDERAL OR STATE, NOR AMONG THE TEXT-WRITERS OF THIS COUNTRY.'

IN GUARANTEE TITLE AND TRUST CO. V. TITLE GUARANTY AND SURETY CO., 224 U.S. 152, 155, 32 SUP. CT. 457, 56 L.ED. 706, THE RULE IS AGAIN STATED, THE FOREGOING CASES ARE CITED, AND IT IS DECLARED THAT "THE POSITION IS ESTABLISHED.' THERE NEVER HAS BEEN DOUBTED, OF COURSE, THE RIGHT OF THE GOVERNMENT TO BUY ITS COAL AT THE LOWEST AVAILABLE PRICES, OR ITS RIGHT FREELY TO CONTRACT WITH ANY OF ITS CITIZENS ON THAT BASIS. ON THE CONTRARY, SUCH PROCEDURE HAS LONG BEEN AFFIRMATIVELY CONTEMPLATED AND REQUIRED BY THE PROVISIONS OF SECTION 3709, REVISED STATUTES. THE CONCLUSION THAT CONGRESS INTENDED TO ABROGATE SUCH GOVERNMENTAL RIGHTS AND BY IMPLICATION TO REPEAL SUCH STATUTORY REQUIREMENT NEEDS MORE SUPPORT THAN THE GENERAL LANGUAGE FOUND IN SECTION 4 (E) OF THE BITUMINOUS COAL ACT, SUPRA, WHICH WAS NOT ADDRESSED TO THE GOVERNMENT, AND IN WHICH THE UNITED STATES IS NOT NAMED, OR INCLUDED BY NECESSARY IMPLICATION, TO GIVE GENERAL EFFECT TO THE LEGISLATIVE PURPOSE. BUT EVEN IF IT COULD OR SHOULD BE DETERMINED THAT THE ACT FORBIDS CODE MEMBERS FROM SELLING COAL TO THE UNITED STATES AT LESS THAN CODE MINIMUM PRICES AND RENDERS UNENFORCEABLE SUCH SALE CONTRACTS, IT STILL WOULD BE NO PART OF THE DUTY OF GOVERNMENT PURCHASING AGENCIES TO PREDETERMINE THE MATTER BY THE REJECTION OF BIDS ASSUMED TO BE IN VIOLATION OF THE CODE. THE ACT SUBJECTS CODE MEMBERS TO CERTAIN PENALTIES FOR WILLFUL CODE VIOLATIONS, PRINCIPALLY THE LOSS OF CODE MEMBERSHIP AND THE PAYMENT OF PENALTIES TO REGAIN MEMBERSHIP, BUT THEY ARE FREE TO ASSUME THE RISK OF SUCH PENALTIES AND THE ACT DOES NOT IMPOSE ON COAL PURCHASERS ANY OBLIGATION TO POLICE THE CODE IN THIS OR OTHER RESPECTS. IT IS NOTED IN THIS CONNECTION THAT A SENATE AMENDMENT MAKING IT A MISDEMEANOR KNOWINGLY TO PURCHASE COAL FROM A CODE MEMBER IN SUCH MANNER THAT ITS SALE CONSTITUTES A VIOLATION OF THE CODE WAS ELIMINATED FROM THE ACT IN CONFERENCE. H.R. CONFERENCE REPORT, NO. 578, APRIL 9, 1937, PAGE 9, AMENDMENT NO. 62. THE ACT MAKES CODE MEMBER CONTRACTS AT LESS THAN CODE MINIMUM PRICES UNENFORCEABLE, BUT EVEN IF THIS APPLIES TO CONTRACTS WITH THE GOVERNMENT, WHICH IT APPARENTLY DOES NOT, A CONTRACT SO MADE, WHILE VOIDABLE, WOULD BE GOOD TO THE EXTENT ACTUALLY PERFORMED, WILLARD, SUTHERLAND AND CO. V. UNITED STATES, 262 U.S. 489, AND IF THE CONTRACTOR IS WILLING TO MAKE AND ABIDE BY THE CONTRACT, EITHER BECAUSE HE CONSIDERS IT NOT IN VIOLATION OF THE CODE OR BECAUSE WILLING TO ASSUME THE RISK OF POSSIBLE PENALTIES OR FOR ANY OTHER REASON THOUGHT TO JUSTIFY SUCH ACTION, THERE WOULD APPEAR NO AUTHORITY FOR GOVERNMENT CONTRACTING AGENTS TO ACT AS HIS GUARDIAN IN SUCH RESPECTS, CONTRARY TO THE POSSIBLE INTERESTS OF THE GOVERNMENT, AND, BY A SUMMARY REJECTION OF HIS BID, TO FORECLOSE HIS OPPORTUNITY TO HAVE ALL QUESTIONS INVOLVED FINALLY ADJUDICATED. WHAT MIGHT BE THE TRUE MINIMUM PRICE APPLICABLE TO ANY PARTICULAR LOT OF COAL WOULD SEEM TO BE COMPLICATED BY SO MANY VARIOUS FACTORS THAT MANY REASONABLE DIFFERENCES OF OPINION MAY BE EXPECTED, AND THE ACT DOES NOT REQUIRE OR AUTHORIZE A DETERMINATION OF SUCH QUESTIONS BY GOVERNMENT PURCHASING OFFICERS, EITHER WITH OR WITHOUT THE ADVICE OF REPRESENTATIVES OF THE BITUMINOUS COAL DIVISION, AS A CONDITION PRECEDENT TO CONTRACTING FOR THE INNUMERABLE LOTS OF COAL REQUIRED TO BE PURCHASED BY THE UNITED STATES EACH YEAR. SO FAR AS CODE COMPLIANCE MAY BE REQUIRED IN MAKING SUCH CONTRACTS, THE BURDEN IS ON THE CONTRACTORS AND NOT ON THE GOVERNMENT OR ITS PURCHASING AGENTS.

FOR THESE REASONS I AM CONSTRAINED TO HOLD THAT THE PROPOSED PROCEDURE WOULD NOT BE AUTHORIZED UNLESS AND UNTIL THE CONGRESS EXPRESSLY SO PROVIDES.