In the Matter of the Petition by PRENTICE-HALL, INC., 113 Sylvan Avenue, Englewood Cliffs, New Jersey 07632, Proposed Revocation of Second-Class Mail Privileges for "ANNOTATED TAX FORMS-PRACTICE & PROCEDURE"; "CAPITAL ADJUSTMENTS-REORGANIZATION-STOCK RIGHTS"; "CONSUMER & COMMERCIAL CREDIT-INSTALLMENT SALES"; "CONTROL OF BANKING REPORT"; "CORPORATION FORMS"; "FEDERAL TAX CITATOR"; "FEDERAL TAX GUIDE"; "FEDERAL TAXES"; "INHERITANCE & TRANSFER TAX"; "INSURANCE REPORT"; "OIL & GAS TAXES- NATURAL RESOURCES"; "PENSION & PROFIT-SHARING"; "PENSION & PROFIT-SHARING FORMS"; "PERSONNEL MANAGEMENT- COMMUNICATIONS"; "PERSONNEL MANAGEMENT- LABOR RELATIONS"; "PERSONNEL MANAGEMENT- POLICIES & PRACTICES"; "REAL ESTATE REPORT"; "SECURITIES REGULATION REPORT"; "STATE & LOCAL TAXES REPORT BULLETIN"; "STATE TAX GUIDE"; "SUCCESSFUL ESTATE PLANNING IDEAS & METHODS"; "TAX COURT REPORTED & MEMORANDUM DECISIONS"; "WAGE-HOUR"; "WILLS-TRUSTS-ESTATE PLANNING FORMS" and "WILLS-ESTATES-TRUSTS", Denial of Application for Second-Class Mail Privileges for "TAX EXEMPT ORGANIZATIONS"; "PROFESSIONAL CORPORATION GUIDE"; "MANUAL FOR MANAGING THE LAW OFFICE"; "SALES TAX"; and "PUBLIC PERSONNEL ADMINISTRATION-LABOR MANAGEMENT RELATIONS", In the Matter of the Petition by EXECUTIVE REPORTS CORPORATION, 113 Sylvan Avenue, Englewood Cliffs, New Jersey 07632, Proposed Revocation of Second-Class Mail Privileges for "PROFESSIONAL MAN'S TAX DESK MANUAL" and "TREASURER'S GUIDE", Denial of Application for Second-Class Mail Privileges for "PRESIDENT'S GUIDE" and "REAL ESTATE MAN'S TAX DESK MANUAL", In the Matter of the Petition by INSTITUTE FOR BUSINESS PLANNING, INC., IBP Plaza, Englewood Cliffs, New Jersey 07632, Proposed Revocation of Second-Class Mail Privileges for "ESTATE PLANNING- CHECKLIST-FORMS"; "FORMS OF BUSINESS AGREEMENTS AND RESOLUTIONS"; "REAL ESTATE INVESTMENT PLANNING"; "REAL ESTATE INVESTMENT PLANNING CHECKLISTS-FORMS"; "TAX PLANNING" and "PAY PLANNING CHECKLISTS-FORMS" P.S. Docket No. 4/80; P.S. Docket No. 4/79 April 8, 1977 Rudolf Sobernheim Administrative Law Judge APPEARANCES: Richard M. Schmidt, Jr., Esq. Ian D. Volner, Esq. Cohn & Marks 1920 L Street, N.W. Washington, D. C. 20036 for Petitioners Arpad de Kovacsy, Esq. Law Department U. S. Postal Service Washington, D. C. 20260 for Respondent
1. By letter, dated 3 February 1975, the Manager of the Mail Classification Division, Finance Department, U. S. Postal Service (hereinafter referred to as the "Manager"), subject to the outcome of this proceeding revoked the second-class mail privileges of twenty-five (25) publications published by Prentice-Hall, Inc., two (2) publications published by Executive Reports Corporation (P.S. Docket No. 4/80) and six (6) publications published by Institute for Business Planning (P.S. Docket No. 4/79) and denied five (5) applications for second-class mail privileges by Prentice-Hall, Inc., and two (2) by Executive Reports Corporation (P.S. Docket No. 4/80).
2. Identification of petitioners and publications in the original revocation notice has been corrected to conform to the facts disclosed by the record and the caption of the proceeding modified accordingly.
3. Petitioners appealed from the Manager's rulings and their appeals were docketed on 30 September 1975 (P.S. Docket No. 4/79) and 1 October 1975 (P.S. Docket No. 4/80).
4. An initial decision was rendered on 20 May 1976 in which with two exceptions the revocation actions of the Manager were sustained and his denials of second-class mail status for five (5) publications of Prentice-Hall, Inc. and two (2) publications of Executive Reports Corporation upheld.
5. On 4 June 1976 petitioners requested an extension of time to file their exceptions from the initial decision as well as a supporting brief. The brief was filed on 11 August 1976 and respondent's reply brief was filed on 23 August 1976.
6. In this brief respondent also filed exceptions from so much of the initial decision as was favorable to petitioners.
7. On 24 September 1976 the President of the United States approved Public Law 94-421, cited as the "Postal Reorganization Act Amendments of 1976", which provided in section 11 (90 Stat. 1311) as follows:
"Sec. 11. Section 3626 of title 39, United States Code, is amended by inserting '(a)' immediately before 'If the rates' and by adding at the end thereof the following new subsections:
'(b)(1) For the purposes of this title, the term "periodical publications", as used in former catalog or other course listing, including mail post-bar admission education issued by any institution of higher education or by a nonprofit organization engaged in continuing legal education; and (B) any looseleaf page or report (including any index, instruction for filing, table, or sectional identifier which is an integral part of such report) which is designed as part of a loose-leaf reporting service concerning developments in the law or public policy.
'(2) Any material described in paragraph (1) of this subsection shall qualify to be entered and mailed as second class mail in accordance with the applicable provisions of former section 4352 through former section 4357 of this title.
'(3) For purposes of this subsection, the term "institution of higher education" has the meaning given it by section 1201(a) of the Higher Education Act of 1965 (20 U.S.C. 1141(a)).
'(c) In the administration of this section, one conservation publication published by an agency of a State which is responsible for management and conservation of the fish or wildlife resources of such State shall be considered a publication of a qualified nonprofit organization which qualifies for rates of postage under former section 4358(d) of this title.
'(d)(1) For purposes of this title, the term "agricultural", as used in former sections 4358(j)(2), 4452(d), and 4554(b)(1)(B) of this title, includes the art or science of cultivating land, harvesting crops or marine resources, or raising of livestock.
'(2) In the administration of this section, and for purposes of former sections 4358(j)(2), 4452(d), and 4554(b)(1)(B) of this title, agricultural organizations or associations shall include any organization or association which collects and disseminates information or materials relating to agricultural pursuits.'."
8. On 1 October 1976 respondent, due to the passage of P.L. 94-421, moved for dismissal of the proceedings P.S. Docket Nos. 4/79 and 4/80 without prejudice. The motion stated that second-class mail privileges, previously denied for seven of petitioners' publications would be granted as of 24 September 1976, the date when P.L. 94-421 became law.
9. Petitioners responded to the motion on 13 October 1976, concurring in the dismissal of all proceedings in P.S. Docket Nos. 4/79 and 4/80 as mandated by P.L. 94-421.
10. Petitioners Prentice-Hall and Executive Reports Corporation, however, correctly viewed respondent's motion as stating respondent's intention not to refund to the two petitioners the difference in cost of postage paid by them for mailing the seven publications pending action on their application for second-class mail privileges and the lesser second-class postage for such mailings.
11. Petitioners argued in support of their motion that Congress had enacted P.L. 94-421 in order to preserve the status quo ante and to reverse what it considered an improper Postal Service attempt to change the law; that Congress had intended "to continue" the law as it stood prior to the attempted change in the law; and that petitioners' applications for second-class mail privileges for the seven publications should be granted nunc pro tunc as if postal law had at all times required such action. See Petitioners' Brief of 13 October 1976, esp. at pp. 4-5.
12. On 13 October 1976 the Judicial Officer ruled on respondent's motion and petitioners' partial opposition thereto.
13. The Judicial Officer's order referred to the fact that a similar issue had arisen in the companion case of Commerce Clearing House, Inc. , P.S. Docket No. 4/181, presently pending before me; that it was not certain whether further evidentiary hearings would be needed to resolve the issue raised by respondent's motion and petitioners' partial opposition thereto but that additional briefs at least would be needed. He added that the issues adversely decided to petitioners in the initial decision, pending on appeal before him, had been mooted by the enactment of P.L. 94-421.
14. Accordingly, the Judicial Officer remanded the instant proceedings for a further initial decision of the issues raised by respondent's motion and renewed appeal to him by the party or parties dissatisfied with the decision. See 39 CFR 954.15, permitting the Judicial Officer to order proceedings before an administrative law judge to be reopened for the taking of additional evidence.
15. On 26 October 1976 respondent's counsel advised the presiding administrative law judge that in effect neither party desired a reopening of the hearing for the taking of additional evidence or to amplify the issues.
16. On 8 November 1976 respondent filed a reply to petitioners' partial opposition to its motion and subsequently petitioners filed a further reply thereto. Respondent attached to its reply copies of the documents constituting the legislative history of section 11 of P.L. 94-421 and furnished to the presiding administrative law judge a copy of the legislative history of P.L. 94-421, printed for the use of the Committee on Post Office and Civil Service of the U. S. House of Representatives (Committee Print 94-20, 94th Cong., 2d Sess.). Petitioners have not objected to the receipt of any of these documents or submitted any documentary evidence.
17. On 9 June 1975 Congressman Ford of Michigan for himself and other members of the House of Representatives introduced H.R. 7735, proposing to amend 39 USC 3626 to include within the term "periodical publications", entitled to be mailed as second-class matter, "any looseleaf page or report (including any index, instruction for filing, table, or sectional identifier which is an integral part of such report) which is designed for inclusion in any treatise or compilation."
18. In a statement inserted into the Congressional Record of 10 June 1975 (pp. E3506-7) Congressman Ford explained his bill, as relevant here, as intended "to continue the established interpretation of the law" and "to preserve the status quo with respect to college and university bulletins and catalogs and looseleaf publications" until the Postal Rate Commission which Congressman Ford viewed as the agency charged with this task would take action. He did not then or later indicate any intention to invalidate retroactively the effect of any final administrative action revoking, or denying applications for, second-class mail privileges already taken under existing procedures.
19. No action was taken by Congress on H.R. 7735.
20. On 14 July 1975 Congressman Hanley of New York for himself, Congressman Ford and other members of the House of Representatives introduced H.R. 8603.
21. On 24 July 1975 the Committee on Post Office and Civil Service of the House of Representatives favorably reported H.R. 8603. It included as section 10 the provisions of H.R. 7735, previously introduced by Congressman Ford of Michigan (see H.R. Rep. No. 94-391, p. 11).
22. The report stated that H.R. 8603 "would insure continuation of second class mailing privileges to college catalogs and bulletins and looseleaf publications" (H.R. Rep. No. 94-391, p. 10). In the "Sectional Analysis" it stated that section 10 was "designed to reverse the current administrative effort of the Postal Service to revoke second-class entry permits for certain publications." Referring to recent Postal Service determinations that certain college catalogs and loose-leaf publications were originally incorrectly admitted as second-class materials ( id ., p. 18) the report noted that under section 10 such catalogs and looseleaf publications would be treated as "periodicals" for second-class mail purposes ( ibid .).
23. H.R. 8603 passed the House of Representatives on 3 November 1975. It was reported by the Senate Committee on Post Office and Civil Service on 21 June 1976 without section 10 but with an express statement that such omission did not indicate committee approval of the administrative actions of the Postal Service to revoke these permits (Sen. Rep. No. 94-966, p. 14).
24. After passing H.R. 8603 on 24 August 1976 the Senate asked for and the House agreed to a conference.
25. The conference committee reinstated the college and looseleaf publications second-class mail provisions as part of section 11 of H.R. 8603 (H.R. Rep. No. 94-1444, p. 10) and commented thereon in a joint explanatory statement ( id ., pp. 17-18):
"The House bill provided that certain publications would be entitled to mail at second-class rate notwithstanding recent administrative efforts by the Postal Service to withdraw such mailing permits from these publications. ***
The Senate bill contained no such provisions.
The conference substitute adopts the House provisions."
26. The conference report on H.R. 8603 was agreed upon on 31 August 1976 (see H.R. Committee Print No. 94-20, p. 540) and was adopted by the House of Representatives on 10 September 1976 ( id ., pp. 556-7).
27. The Senate debate did not advert to section 11. In the House of Representatives Congressman Ford of Michigan, however, spoke in the debate to this section. After referring to "a fairly active campaign" by the Postal Service "to revoke" second-class mailing permits of publications not meeting the definition of Houghton v. Payne , 194 U.S. 88 (1904) he concluded:
"Section 11 of H.R. 8603 requires that such publications be entered at second-class rates. It will merely be a ministerial duty for the Postal Service to reissue permits as soon as this legislation is signed into law in the case of publications which have already had their permits revoked." ( id ., at p. 550, col. 2)
A. AS TO THE PARTIES' POSITIONS
1. Petitioners and respondent are agreed that enactment of P.L. 94-421 leads to the discontinuance of the proceedings in P.S. Docket Nos. 4/79 and 4/80 as far as they affect publications referred to in section 11 thereof and mailable as second-class matter under permits which have not been revoked prior to its enactment.
2. In their view enactment of the statute apparently now prevents an adjudication that prior thereto petitioners' publications were not mailable as second-class matter.
3. They also agree that the applications of petitioners Prentice-Hall, Inc. and Executive Reports Corporation for second-class mail privileges in respect of seven publications, pending on the date of the enactment of P.L. 94-421, must be granted at least as of that date, i . e ., 24 September 1974.
4. Petitioners, however, contend that their seven applications should take effect as of the application date, in five instances allegedly in early 1971 (Pet'rs Br., p. 5, n), pointing to those statements of Congressman Ford, previously referred to in the Findings of Fact, which emphasize the intent of the proffered legislation to continue the established interpretation of the law relating to second-class mail status until "changed" otherwise than by administrative Postal Service rulings.
B. AS TO RETROACTIVITY OF P.L. 94-421
5. On its face P.L. 94-421 contains no language which fixes its effective date or deals with the prospective or retrospective character of its operation. The bare text of the statute itself is of no help in resolving the problem.
6. In consequence, we turn to the legislative history of P.L. 94-421 for such light as it may throw on the problem. See Federal Energy Administration v. Algonquin SNG, Inc. . 426 U.S. 548 (1976). The course of the legislation and relevant statements of its principal proponent (Congressman Ford of Michigan) and in Congressional committee reports have been set forth fully in the Findings of Fact on this topic.
7. This legislative history is of little value on the question to be decided. For although Congressman Ford referred to the reinstatement of second-class mail permits for covered publications which had been revoked prior to the enactment of P.L. 94-421 he never mentioned the treatment of applications which had been rejected under the Postal Service interpretation of the law.
8. Congressman Ford initially emphasized his intent to "continue" the interpretation of postal law prevailing before recent changes therein by administrative Postal Service rulings, as he viewed the situation. But his statement on the floor of the House of Representatives in the final debate on the conference bill shows that in his view P.L. 94-421 did not annul Postal Service action which had finally revoked second-class mail privileges for covered publications prior to enactment of the bill. On the contrary, to give effect to the statute, revoked second-class mail privileges were to be re-issued.
9. Thus it can be inferred that P.L. 94-421 was to operate prospectively. This is the general rule of statutory construction unless a contrary intent is shown. See United States v. Donnelly's Estate , 397 U.S. 286, 294 (1970); Fisher v. Home Indemnity Co. , 192 F.2d 218 (5th Cir., 1952); Peony Park v. O'Malley , 121 F. Supp. 690 (D. Neb., 1954), aff'd 223 F.2d 668 (8th Cir., 1955), cert. den. 350 U.S. 845 (1955); reh. den. 350 U.S. 898 (1955); see also SUTHERLAND, STATUTORY CONSTRUCTION, sec. 46.01 (1972).
10. The legislative history of section 11 of P.L. 94-421 is insufficient to supply evidence of Congressional intent of retrospective operation for which its unambiguous text fails to provide. Hence, petitioners' contention as to the construction of section 11 cannot be sustained.
11. The retroactivity vel non of P.L. 94-421 does not, however, provide the proper basis for an initial decision on the issue raised by petitioners' partial opposition to the motion to dismiss.
12. This basis rests on the established Postal Service rule that the subsequent grant of an application for second-class mail privileges relieves the applicant of the burden of higher than second-class postage as of the date of the initial application and that postage in excess of second-class postage, paid during the period of pendency of the application, will be refunded to the applicant. Postal Service Manual (PSM), sec. 132.32. This section applies whether an application is initially granted by the Manager or by decision of the Judicial Officer when an appeal from a denial is taken to him.
13. If P.L. 94-421 had not been enacted but the Judicial Officer had reversed the initial decision sustaining the Manager's denial of the seven applications for second-class mail privileges there is no question that the Judicial Officer's action would result in the refund of excess postage. See PSM 132.32.
14. There appears no reason why this provision on which petitioners' right to the refund of excess postage rests, should not be applied here. Respondent has focused its argument on the prospective operation of the statute but petitioners' right to the refund does not rest on general principles of prospective or retroactive operation of statutes. Respondent's argument does not refer to the cited Postal Service regulation and fails entirely to provide a reason for its inapplicability here.
15. In view of the enactment of P.L. 94-421 the legal principles set forth in the initial decision pursuant to which petitioners' applications had been denied can no longer be applied.
16. This is both recognized in the Judicial Officer's comment in the remand order that P.L. 94-421 has mooted the issues previously adversely decided to petitioners and in respondent's own motion which recognizes that petitioner's applications for second-class mail privileges must now be granted.
17. Petitioners' applications comply with the provisions of former section 4352 through 4357 of title 39 of the United States Code, as required by section 11 of P.L. 94-421.
18. It follows that petitioners are entitled to all benefits of a grant of second-class mail privileges, including those of Postal Service Manual, section 132.32 and that petitioners' partial opposition to respondent's motion to dismiss must be sustained.
19. Accordingly, respondent's motion to dismiss without prejudice the proceedings in P.S. Docket Nos. 4/79 and 4/80 is granted. Petitioners will retain the second-class mail privileges previously granted and shall receive second-class mail privileges in respect of the seven publications anent which applications were denied, subject to the benefits conferred by Postal Service Manual section 132.32.