Railroad Commission v. Sterling Oil & Refining Co.

Mr. Justice Smedley,

dissenting.

I cannot agree to the decision of the majority that the Court has jurisdiction of this case on direct appeal. Appellees correctly, in my opinion, challenge the jurisdiction on two grounds. The first of these is that Section 3-b of Article V of the Constitution (adopted as an amendment by election held November 5, 1940) confers jurisdiction by direct appeal only in certain cases involving Constitutional validity of statutes or of administrative orders issued by state agencies; and that this case as attempted to be brought to this Court by direct appeal, presents only a question as to the factual basis of an order of the Railroad Commission, that is, whether the order is reasonably supported by substantial evidence introduced in District Court.

The wording of the amendment, which is copied in the opinion of the majority, is that the Legislature shall have the power to provide by law for an appeal direct to the Supreme Court from an order of any trial court granting or denying *561 an injunction “on the grounds of the constitutionality or unconstitutionality of any statute of this State, or on the validity or invalidity of any administrative order issued by any state agency under any statute of this State.” The majority opinion takes jurisdiction of the case, considers the statement of facts, and passes upon the factual basis of the order under attack, thus assuming that the words “validity or invalidity of any administrative order” include the correctness of the order as supported by the facts. The word “valid” in.its broadest sense, applied to an order of the Railroad Commission or other administrative agency, may be used as having reference to the correctness of the order in its factual support, but on the other hand the word may be used in a narrower sense and with more exactness as meaning validity of a fundamental nature, that is, constitutional validity. The more reasonable conclusion, in my opinion, is that the word was used and intended to be used in this amendment in the narrow or more exact sense.

That this is true follows from a consideration of the purpose of the amendment and of the radical and perhaps disastrous change that it would authorize to be made in the Court’s jurisdiction were it construed in its broadest sense so as to authorize the conferring of jurisdiction by direct appeal in all cases, where injunction has been issued or denied, involving the correctness in factual support of any and all orders of any and all administrative agencies of the State.

Obviously the purpose of the amendment was to obtain prompt and final decision of questions of vital importance arising in certain cases, by skipping over the Courts of Civil Appeals and taking cases by direct appeal to the Supreme Court. Questions of constitutionality are usually regarded as of greatest importance. Consequently the amendment authorized the Legislature to provide by law for direct appeals in certain cases involving the constitutionality of statutes. It is significant that the language of the amendment refers only to constitutionality of statutes and not to construction of them. Questions as to construction of statutes may often be of very great importance, but the amendment does not extend the authority to those questions. In its inclusion of orders of administrative agencies the amendment uses the words “validity or invalidity” rather than the words “constitutionality or uncons,titutionality”. But if the words used are taken in their narrow or more exact sense of fundamental validity or invalidity, that is, constitutionality or unconstitutionality, there is consistency in the amendment; it limits the authority to provide for direct appeal to cases and *562 questions of constitutionality, cases and questions of vital importance, whether a statute or an order of an administrative agency is involved; and it does not authorize the imposition upon the Court of the burdensome duty of reviewing statements of facts, in appeals taken as a matter of right, for the purpose of ascertaining what is the basis in the facts, and whether that basis is reasonable, for various and sundry orders of various and sundry administrative agencies. Whether this order or that order of an administrative agency is valid, in the sense that it is reasonably supported by substantial evidence, is rarely of such vital importance as to justify a by-passing of the Courts of Civil Appeals in order to obtain from the Supreme Court a quick decision by direct appeal, and unless the language used absolutely demands it, the amendment should not be construed as authorizing legislation for direct appeals in cases of that kind.

The amendment by reason of the use of the words “validity or invalidity”, when speaking of an administrative order, in close connection with the words “constitutionality or unconstitutionality” when speaking of a statute, is certainly • open to construction. That constitutional validity or invalidity is intended is evidenced by contemporary construction of the amendment in its adoption and submission to the voters by the Legislature, in its official publication, and in this Court’s action in promulgating in Rule 499a the procedeure for direct appeals.

The Resolution proposing the amendment as published in the Session Laws of the 46th Legislature is entitled: “A Resolution Proposing a Constitutional Amendment to Authorize the Legislature to Provide for Appeals Direct to Supreme Court in Instances Involving Constitutionality of Certain Laws and Orders.” (Emphasis added.) Section 1 of the Resolution is the proposed amendment in the language as set out in the majority opinion and above stated. Section 2 of the Resolution provides for the submission of the amendment to the qualified voters and that at the election the voters favoring the proposed amendment shall write or have printed on their ballots the words: “For the amendment to the Constitution of the State of Texas authorizing the Legislature to provide for appeals direct to the Supreme Court in instances involving the constitutionality of certain laws and orders”. (Emphasis added.) Section 2 directs what shall be written or printed on the ballots of the voters opposed to the amendment. It is the same as that above quoted *563 except that the word “against” is used instead of the word “for”. (Acts Regular Session, 46th Legislature, pp. 714-715.)

It is granted that the amendment as set out in Section 1 of the Resolution has become a part of the Constitution through its adoption by the electors, but the whole of the Resolution may be looked to in determining the meaning of Section 1. It is not lightly to be assumed that the Legislature meant by one section of the Resolution that direct appeals might be authorized in cases involving validity of administrative orders in the broadest sense and meant by another section of the same Resolution that direct appeals might be authorized only in cases involving constitutionality of such orders. It is not to be assumed that the Legislature intended to mislead the electors by requiring them to vote on the question whether direct appeals might be allowed only when constitutionality of administrative orders is raised. Yet that is what was done, that is, the voters were misled, if Section 1 is construed to include cases in which any sort of question as to validity of orders, including factual support, is presented. The safer course, with due regard to the rights of the electors, is to construe the amendment as meaning what they voted upon, and it can be given that construction without doing violence to its language. It is also granted that the title of the Resolution above quoted is not a part of the amendment, but it does represent the construction placed upon the amendment by the officials who were charged' with the publication of the Acts of the Legislature, including the Resolutions.

Rule 499a promulgated to regulate appeals pursuant to the amendment represents this Court’s construction of the amendment as intending not to include direct appeals in cases where the question is as to the reasonable sufficiency of the factual support for the administrative order. This, because of the express provision of Rule 499a which prohibits the use of a statement of facts. The question whether an order is reasonably supported by substantial evidence cannot be determined without examination of all of the evidence introduced on the trial in court.

The Attorney General contends that this Court in two cases directly appealed has in effect construed the amendment as authorizing direct appeals in cases where statutory validity of administrative orders rather than constitutional validity was presented. The cases are Board of Insurance Commissioners v. Guardian Life Insurance Co., 142 Texas 630 , 180 S. W. (2d) 906 and Railroad Commission of Texas v. Shell Oil Co., 146 Texas 286 , 206 S. W. (2d) 235 (the Seeligson casee). Examina *564 tion, however, of the opinions and of the records in those two cases shows that in neither of them was the question whether the amendment authorized direct appeals only in cases involving constitutional validity of administrative orders either discussed or decided by the Court, or presented by motion or by brief. In each of those cases the appeals were from orders granting temporary injunction, and in each of them the order of the trial court was affirmed. In the Guardian Life case the Court held that the order of the Board was invalid because in entering it the Board went beyond the authority given by the statute. In the Seeligson case .the Court, in affirming the order granting a temporary injunction on the ground that the trial court did not as a matter of law abuse its discretion, expressed the opinion that the order of the Commission was “well within the perimeter of its delegated powers”.

If these two cases are to be considered decisions by the Court that it has jurisdiction in direct appeals of cases presenting the question whether the administrative order is authorized by statute, the implied decision as to jurisdiction goes no further than that. A decision that an administrative order is or is not within statutory authority is one of fundamental validity, the same in principle as a decision that a statute is or is not contrary to the Constitution. The implication as to jurisdiction in those two cases does not amount to a holding that there may be a direct appeal in cases where the question' is whether the order is reasonably supported by substantial evidence and where examination of all of the evidence introduced in district court, both in favor of and against the order, is required.

The second ground on which jurisdiction is challenged is by reason of Rule 499a, both as a construction of the amendment by the Court and in its express prohibition of a statement of facts. The effect of the rule as a construction of the amendment has been discussed above. The one question raised by appellants’ one assignment or point cannot be decided without an examination by the Court of all of the evidence admitted on the trial in the district court. Hawkins v. Texas Company, 146 Texas 511 , 209 S. W. (2d) 338 ; Wrather v. Humble Oil & Refining Co., 147 Texas ______ , 214 S. W. (2d) 112 . The opinion of the majority quotes most of Rule 499a, including the part which provides that “a statement of facts shall not be brought up except to such an extent as may be necessary to show that the appellant has an interest in the subject matter of the appeal and to show the proof concerning the promulgation of any *565 administrative order that may be involved in the appeal.” But the opinion of the majority then proceeds to disregard the Court’s rule by reviewing and considering the evidence in the statement of facts for the purpose of determining whether the order of the Commission is reasonably supported by substantial evidence.

In his first brief the Attorney General expresses the belief that Rule 499a in “limiting appeals to .questions of law in these specific types of cases is not in harmony with the specific constitutional provision”, meaning the amendment. This contention is directly refuted by the Court’s opinion expressed in the Seeligson case that the amendment means that the appellate jurisdiction of the Court shall continue to be limited to questions of law and that to that end Rule 499a was framed to exclude from consideration controverted issues of fact. 146 Texas 286, 291 , 206 S. W. (2d) 235 .

The Attorney General’s second brief, that directed particularly to the question of jurisdiction, omits the attack on the rule made in the first brief and makes no attack either upon the part of the rule which excludes issues of fact or upon the part which prohibits a statement of facts. The brief argues that the statement of facts may be considered under the provision that a statement of facts may be brought up to such extent as may be necessary to show “the proof concerning the promulgation of any administrative order that may be involved in the appeal”, and that accordingly in this case all of the evidence may be brought up and considered to show whether the order is reasonably supported by substantial evidence. The argument is unsound. In the cases last cited and in others the Court has held that in a suit questioning the factual basis of an order of the Commission, the trial court and the appellate courts must determine from all the evidence introduced on the trial whether the Commission’s order is reasonably supported by substantial evidence. This has reference to the evidence admitted and heard in district court where the factual reasonableness of the order promulgated by the Commission is tested by suit, and this is the evidence which the majority has considered in making its decision herein. This is not “proof concerning the promulgation of” the administrative order. Proof concerning the promulgation of the order would relate to what was done by and before the Commission in the promulgation of the order. For example, such proof would be that the order was made, what the order was, and whether it was made after notice and hearing, and whether the Commission permitted the introduction of *566 evidence. The exception permitting the bringing of a record to show the facts as to such matters was doubtless intended to afford the opportunity to prove constitutional validity or invalidity of the administrative order, having in mind due process.

The meaning of the Court’s rule is plain. The Court should observe it or should hold it unconstitutional. It is not unconstitutional. First, it should be observed that the rule was deliberately promulgated by the Court after due consideration. The promulgation of the rule, while not a decision of a cause, is the expression of the Court’s opinion that the rule is valid and not unconstitutional. Words used by Chief Justice Phillips in San Antonio & Aransas Pass Ry. Co. v. Blair, 108 Texas 434, 436 , 196 S. W. 502 , are appropriate here, although they were not used in reference to a rule but in reference to the Court’s action in proceeding* under a statute attacked as unconstitutional. He said: “Had we not determined it to be a valid Act, we would not have proceeded under it. It was intended, therefore, that our action in inagurating it should serve as in effect a judgment in respect to its validity, and should be so understood”.

The amendment is not self-executing. It is not even mandatory in its terms. It provides merely that the Legislature shall have the power to provide by law for direct appeals to the Supreme Court in certain cases described in g*eneral terms. The Act of the Legislature, in substantially the language of the amenedment, is merely that appeals may be taken direct to the Supreme Court in the cases described in the amendment. The Act makes it the duty of the Supreme Court “to prescribe the necessary rules of procedure to be followed in perfecting such an appeal.” Acts Regular Session, 48th Legislature, Chapter 14 (Vernon’s Annotated Civil Statutes, Article 1738a). Thus there is no legislation regulating appeals except Rule 499a of the Supreme Court promulgated pursuant to the authority given by the act of the Legislature and under the Court’s rule-making power.

The amendment and the Act of the Legislature contain no regulations, restrictions or limitations of the method of appeal or of the means by which jurisdiction to hear the appeal may be acquired. Neither the amendment nor the Act provides that there shall be an appeal as a matter of right. Neither of them undertakes to regulate the procedure for appeal, when or how it may be taken, or what shall be contained or not contained in the record. These are left to rules to be prescribed by the Court.

*567 The Court in its Rule 499a, after the paragraph excluding from consideration contested issues of fact and forbidding the bringing up of a statement of facts, provided that the rules prescribed for appeal to the Court of Civil Appeals, except where inconsistent with Rule 499a, should apply to direct appeals to the Court. No doubt the Court could have restricted the direct appeals by adopting the writ of error practice, since neither the amendment nor the statute grants direct appeal as a matter of right, and fixing a mode of appeal is only a regulation of the manner in which the appeal is to be taken. San Antonio & Aransas Pass Ry. Co. v. Blair, 108 Texas 434 , 439 S. W. 502 .

The language used in the amendment and in the statute, taken literally, would include jurisdiction over questions of fact as well as over questions of law in the direct appeals, but the Court by Rule 499a has limited or restricted the jurisdiction to questions of law. That part of the rule, as above shown, has been held valid and effective in the Seeligson case, 146 Texas 286, 291 , 206 S. W. (2d) 235 . If that part of the rule is valid, then the provision of the rule that statements of fact, with certain exceptions, shall not be brought up is valid, and should be given effect, although it may operate to exclude from the Court’s jurisdiction certain questions, such as the one question raised by the appeal in this case. A rule defining what shall or shall not be contained in the record on appeal is a “rule of procedure to be followed in perfecting” the appeal, and the promulgation of such a rule is within the authority of the Court. The opinion in San Antonio & Aransas Pass Ry. Co. v. Blair, 108 Texas 434 , 196 S. W. 502 , supports these conclusions.

The opinion of the majority is erroneous in its statement that substantially the same questions as to jurisdiction presented in this case and discussed above were decided in the Seeligson case. The questions as to jurisdiction presented in this case, as the record, the motion and the briefs in that case show, were not raised in the Seeligson case, and consequently, and as the opinion shows, they were not decided in that case. Motion to dismiss the appeal in that case was made on two grounds, first that the notice of appeal to the Supreme Court was ineffective because jurisdiction of the Court of Civil Appeals theretofore given. That question is not in this case. The second ground of the motion to dismiss in the Seeligson case was that there were contested issues of fact in the case. That contention is not made in this case. The Court in overruling the motion to dismiss in that case held that “a decision of this cause must turn * * * not upon the issues of fact, but of law”, *568 and on that conclusion overruled the motion to dismiss. 146 Texas 286, 291 , 206 S. W. (2d) 235 . In deciding the Seeligson case the Court did not determine the factual validity of the order of the Commission, saying that its validity must be determined on a full development of the fact upon the final trial. The Court did not look to the statement of facts at all, but after observing that findings of fact of the trial court, not challenged, indicated that evidence had been introduced which at lease tended to sustain the cause of action pleaded by the operators, affirmed the trial court’s order, on the conclusion that the trial court did not as a matter of law abuse its discretion in granting the temporary injunction.

This Court is without jurisdiction and the appeal should be dismissed. I express no opinion as to the merits of the question sought to be appealed, not having read the statement of facts, which should not have been filed.

Opinion delivered February 16, 1949.