Hardin v. Kentucky Utilities Company/Dissent Harlan

by John Marshall Harlan II

United States Supreme Court

390 U.S. 1

Hardin  v.  Kentucky Utilities Company

 Argued: Dec. 13, 1967. --- Decided: Jan 16, 1968

Mr. Justice HARLAN, dissenting.

These cases present a narrow question of statutory construction, upon which differing views might reasonably be entertained. I cannot, however, agree that the position now adopted by the Court will satisfactorily achieve the purposes evidently sought by Congress in 1959. I therefore respectfully dissent.

The scope of judicial review of administrative action is, of course, governed principally by the terms and purposes of the underlying statutory system. Compare generally 4 Davis, Administrative Law Treatise § 30.03 (1958); Jaffe, Judicial Review: Question of Law, 69 Harv.L.Rev. 239; Jaffe, Judicial Control of Administrative Action 546 et seq. (1965). The purposes of these statutory provisions are uncommonly plain. The Court acknowledges, as it must, that 'it is clear and undisputed that protection of private utilities from TVA competition was almost universally regarded as the primary objective of the (service area) limitation.' Ante, p. 665.

The provisions in question were expected to protect private utilities by 'defin(ing)' and 'limit(ing)' the 'working arrangement that now exists with respect to' the Authority's service area. S.Rep. No. 470, 86th Cong., 1st Sess., 8. They were thus intended to constrict the Authority's discretion as to the expansion of its area of service. It is no disparagement of the Authority to recognize that an orderly system of law does not place the enforcement of a restraint upon discretion into the unfettered hands of the party sought to be restrained; surely, therefore, the scope of judicial review of proceedings involving such limitations should be measured generously.

The role of the courts should, in particular, be viewed hospitably where, as here, the question sought to be reviewed does not significantly engage the agency's expertise. This is an instance 'where the only or principal dispute relates to the meaning of the statutory term,' NLRB v. Marcus Trucking Co., 2 Cir., 286 F.2d 583, 591; it may, as Judge Friendly has noted, therefore appropriately be denominated a 'question of law.' Ibid. It presents issues on which courts, and not the Authority, are relatively more expert. See 4 Davis, supra, at § 30.04. No doubt 'economic and engineering aspects,' ante, p. 9, including topography, may influence the Authority's wish to expand its area of service, but such factors can hardly prescribe the terms or stringency of Congress' prohibitions against expansion.

In light of these considerations, I am unable to accept this decision, the effect of which is to restrict severely the scope of judicial review of the Authority's determinations under § 15d(a). The Court forbids reviewing courts to set aside such determinations unless they lack 'reasonable support,' and then discovers such support here in the most minimal evidence. ^[1] At bottom, the support adduced for this determination by the Court consists of two facts: first, the Authority's distributor served on July 1, 1957, eight customers in New Tazewell and 20 customers in Tazewell; ^[2] and second, at least some of the other residents of the two municipalities quite understandably would prefer to pay the lower rates for electrical power charged by the Authority. ^[3] If these facts illustrate the 'reasonable support' demanded by the Court, Congress' stringent limitation upon the Authority has proved extraordinarily fragile. ^[4]

Neither the statute nor the pertinent legislative history provides any formula for the precise measurement of the Authority's service area. However, given Congress' clear purpose to restrict stringently the expansion of the area served by the Authority on July 1, 1957, I think that the emphasis placed by the Court of Appeals on the number of customers served on that date by respondent and the Authority offers the basis of a sensible and practical standard. Certainly Congress did not wish or expect that, as this Court now holds, the question should be left largely, if not entirely, in the hands of the Authority. I would therefore affirm the judgment below for the reasons given in Judge O'Sullivan's opinion for the Court of Appeals, 375 F.2d 403, supplemented by the considerations discussed in this opinion.

Notes

1. It should be noted that the agency determination upon which the Court places so much weight was reached at a 'special meeting' of the Board of Directors on August 26, 1964, more than eight months after respondent filed its complaint, and only three weeks before trial. One of the staff memoranda upon which the determination was based refers specifically to this litigation. One might have supposed that a determination which was made post litem motam warranted at least cautious treatment.
2. The Court's choice of descriptive phrase is noteworthy. The Court suggests that the Authority's distributor served 'a substantial minority' of the customers in the two Tazewells. The District Court found, in fact, that on July 1, 1957, respondent served 95.3% of those customers. 237 F.Supp. 502, 513.
3. The Court intimates darkly that 'economic dislocations' have occurred. The pertinent evidence appears to consist at bottom of allegations that housing and other forms of economic development tend to locate in areas in which the Authority's less expensive electrical power is available. Surely the Court does not suppose that Congress in 1959 was unaware that the Authority's electrical power is relatively inexpensive, or that it did not recognize that those who reside outside the Authority's service area would find it economically desirable to have that area extended so as to include themselves.
4. It is pertinent to note that neither of the two staff memoranda upon which the Authority's belated determination was explicitly based included among the 'facts which appear to be relevant' (Memorandum from the Manager of Power to the General Manager, Tennessee Valley Authority, August 25, 1964, 2 Transcript of Record 801) any references to 'economic and engineering aspects' (ante, p. 9), or even to any 'economic dislocations' (ante, p. 13). Whatever the relevance of these factors in the eyes of the Court, the Authority's staff appears to have thought them immaterial. The determination itself does not, of course, refer to these factors.