United States v. American Union Transport/Dissent Frankfurter
Mr. Justice FRANKFURTER dissenting, with whom Mr. Justice BLACK and Mr. Justice DOUGLAS concur.

It is important to keep in mind what this case is not. It does not involve the power of the Maritime Commission to obtain from a forwarder all information relevant to any inquiry by the Commission, based on complaints of violations of the Shipping Act or on its own motion. Section 27 of that Act gives the Commission such subpoena powers and subjects every person, forwarder or not, to testimonial compulsion. 39 Stat. 728, 737, 46 U.S.C. § 826, 46 U.S.C.A. § 826. Nor does the case involve the attempt of a carrier to use a forwarder as a means of evading the regulations by which water carriers are controlled. By no such indirection can a carrier immunize itself against the Act's penalties. Compare Lehigh Valley R. Co. v. United States, 243 U.S. 444, 37 S.Ct. 434, 61 L.Ed. 839.

The case is this. The business of these appellees is to negotiate on behalf of shippers for shipping space and to make the necessary administrative arrangements for the carriage of goods. They have no part in the physical process of moving goods. They have no corporate, physical, or financial tie with the carriers. The sole question here is whether such business has been brought under the regulatory scheme of the Act. The Commission contends that they are 'persons subject to the Act.' If the Commission is correct, these forwarders would have to submit all sorts of agreements with carriers and with other forwarders to the Commission for approval (39 Stat. 733, 46 U.S.C. § 814, 46 U.S.C.A. § 814), whereupon such agreements may be freed from the restrictions of the Sherman Law, 15 U.S.C.A. §§ 1-7, 15 note; they would be required to maintain uniform rates (39 Stat. 734, 46 U.S.C. § 815, 46 U.S.C.A. § 815); they would be subject to the Commission's supervision insofar as their activities involved practices pertaining to the handling and care of shipments (39 Stat. 734, 46 U.S.C. § 816, 46 U.S.C.A. § 816); they would have to file reports and business records called for by the Commission (39 Stat. 736, 46 U.S.C. § 820, 46 U.S.C.A. § 820); they would be subject to the Commission's power to award reparations for violations of the Act (39 Stat. 736, 46 U.S.C. § 821, 46 U.S.C.A. § 821); and they would be liable to heavy penalties (39 Stat. 734, 736, 738, 40 Stat. 900, 902, 46 U.S.C. §§ 815, 820, 831, 839, 46 U.S.C.A. §§ 815, 820, 831, 839).

The Shipping Act has been on the statute books since 1916. Yet not until 1942 did the agency charged with the duty of enforcing the Act deem forwarders of this type to be covered by it. The scope of its legislation is, of course, for Congress to determine and not for the enforcing agency. Inaction, no matter how consistent and long-continued, cannot contract the reach of a statute. But much has properly been said about the important significance which attaches to the meaning given a statute by those whose duty it is to enforce it and who are deemed especially equipped to breathe life into inert language. Just as assumption of jurisdiction by an administrative agency for a long period of time goes a long way to prove that powers exercised were impliedly given, see United States v. Midwest Oil Co., 236 U.S. 459, 35 S.Ct. 309, 59 L.Ed. 673, a consistent and unexplained failure to exercise power not obviously conferred by legislation may be equally persuasive that the power claimed was never conferred. It is not to be presumed that for decades officials were either ignorant of the duties with which Congress charged them or derelict in their enforcement.

A consideration of the language of the legislation in its proper setting makes it abundantly clear that the failure of the Commission and its predecessor for more than twenty-five years to exercise the authority which it now claims was due neither to ignorance nor to indifference. The explanation that would spontaneously occur to one for such administrative practice is, I believe, the right one: the power was not exercised because Congress did not grant it.

It is a fair generalization that Congress has never supplanted the forces of competition by administrative regulation until a real evil had, in the opinion of Congress, manifested the need for it. One turns in vain to the Congressional investigation which led to the Shipping Act, to the hearings on the bills which became that Act, to the reports on which it was based, to the experience under the Act since its inception, as reflected in the reports of the Maritime Commission and its predecessor the Shipping Board, for any indication that the business of independent forwarders, like those in this case, was so conducted as to make their regulation appropriate either to curb practices themselves inimical to the public interest or to render effective the regulation of water carriers.

The Commission's claim of jurisdiction must rest on construction of the phrase 'business of forwarding * * * in connection with a common carrier by water.' 39 Stat. 728, 46 U.S.C. § 801, 46 U.S.C.A. § 801. Whatever the 'business of forwarding' may here mean, effect must be given to the qualifying phrase 'in connection with a common carrier by water.' If it is left without any appropriate function unless these independent forwarders are covered, it must be applied to them. But if ample scope can be given to the phrase without attributing to Congress such a sudden assumption of authority over independent forwarders although no need for taking such control had been revealed, we should avoid undue extension of language as part of our duty to give fair meaning to what Congress has said.

Abstractly it may be argued that 'forwarding' was intended to cover only those activities which included the physical transportation or movement of goods from one place to another. Cf. e.g., H.R. 9089, 9090, 9888, 76th Cong., 3d Sess. (1940); S. 3665, 3666, 4096, 76th Cong., 3d Sess. (1940). Support for such a restrictive meaning might be drawn from the fact that the 'other persons' subject to the Act were those concerned with the physical handling of the goods. But such a construction would disregard the purpose of the statute. Again, the term may be said to cover only those businesses in which the forwarder assumes the liability for safe shipment of the goods from point of shipment to their destination. Cf. 56 Stat. 284, 49 U.S.C.Supp. IV § 1002(a) (5)(B), 49 U.S.C.A. s 1002(a)(5)(B). Such a construction likewise does not harmonize with the aims of the statute. The most natural meaning of 'forwarding' includes the business in which these appellees engage, namely, the rendering of administrative and brokerage services. Cf. H.R.Rep.No. 1682, 77th Cong., 2d Sess. (1942).

But Congress did not regulate 'forwarders'; it regulated the 'business of forwarding * * * in connection with a common carrier by water.' When, then, is forwarding 'in connection with a common carrier by water'? That term may mean a business or financial connection; it may mean a physical connection, i.e., the mutual handling of goods; it may mean both. Or it may mean any share in the process of offering of goods for water shipment. This last construction would mean that the restriction could have been included only for the purpose of excluding forwarders like these but concerned with shipment by rail. Such is the Commission's essential argument, that the phrase is merely a saving clause against its application to forwarders dealing with land carriers. To suggest that such a roundabout method was used for the purpose of saying that this statute was not impliedly intended as an amendment to the familiar Interstate Commerce Act, 24 Stat. 379, 49 U.S.C. § 1 et seq., 49 U.S.C.A. § 1 et seq., amendments to which have always been designated as such, the administration of which was vested with a different Commission, the Interstate Commerce Commission, and the subject matter of which was completely distinguishable in the very titles of the statutes, is to attribute a fanciful abundance of caution, and less than common sense to the draughtsman. If every forwarder dealing with water carriers was to be covered by the Act, the obvious way of covering them would have been simply to say 'forwarders' without qualification. The Commission really asks us to disregard the duty of courts to give effect to every phrase used by Congress. The construction which is now accepted means that 'in connections with a common carrier by water' are p rfectly superfluous words and are to be deleted.

Significance must be given to the qualification. What more reasonable than to hold that this phrase means those forwarders who are so closely tied to the business of the water carrier, by corporate, financial, or physical union, as to make regulation of them appropriate in order to control effectively the carriers with which they are affiliated? Such a forwarder is really a part of the process of carrying. Here the forwarders are closely connected not with the carrier but with the shipper.

That such construction respects Congressional purpose is reinforced by Congressional action regarding forwarders dealing with land carriers. When Congress, in 1942, first regulated such landcarrier forwarders, 56 Stat. 284, 49 U.S.C., Supp. IV, § 1001 et seq., 49 U.S.C.A. § 1001 et seq., forwarders, having the same functions in relation to land traffic as these appellees do in relation to water-borne traffic, were not included. And yet it is argued that Congress thirty years ago asserted control over such forwarders concerned with water-borne traffic and forbade ordinary competition among them, though no basis in experience can account for such action by Congress.

State of California v. United States, 320 U.S. 577, 64 S.Ct. 352, 88 L.Ed. 322, involved a totally different situation. That case was concerned with wharves-facilities physically connected with water carriers. These were just as much the agents of the carrier as of the shipper; they formed an integral part of the carrier's business. As a matter of physical fact, the 'connection' of these forwarders to a carrier is very different from the 'connection' of wharf facilities to the carrier. Awareness of that fact was demonstrated by the specific omission, in the California opinion, of the term 'forwarder' in considering whether port facilities were 'connected' with water carriers. See State of California v. United States, supra, 320 U.S. at page 586, 64 S.Ct. at page 357, 88 L.Ed. 322. The difference in fact and in business relation between the forwarders' 'connection' in this case, constituting merely an aspect of the shipper-carrier relationship, and the 'connection' in the California case, which normally involves a close business tie with the carrier, is vital and should be observed in applying a section in which Congress dealt compendiously with various enterprises outside of, but related to, the regulated functions of water carriers. 

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