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Under 7 U.S.C.S. § 211, the necessary rule that "one who decides must hear" does not preclude practicable administrative procedure in obtaining the aid of assistants in the department. Assistants may prosecute inquiries. Evidence may be taken by an examiner. Evidence thus taken may be sifted and analyzed by competent subordinates. Argument may be oral or written. The requirements are not technical. But there must be a hearing in a substantial sense. And to give the substance of a hearing, which is for the purpose of making determinations upon evidence, the officer who makes the determinations must consider and appraise the evidence which justifies them. That duty undoubtedly may be an onerous one, but the performance of it in a substantial manner is inseparable from the exercise of the important authority conferred.
Plaintiff market agencies filed the present suits attacking the order of the Secretary of Agriculture, so far as it prescribed maximum charges for selling livestock, as illegal and arbitrary and as depriving plaintiffs of their property without due process of law in violation of the Fifth Amendment of the Constitution. The District Court of three judges entered decrees sustaining the order and dismissing the bills of complaint. On appeal, plaintiffs asserted that the ultimate basis for the reduction in commission rates was the Secretary's opinion that there were too many market agencies, too many salesmen, and too much competition in the business; that the Secretary has departed entirely from the evidence as to the actual cost of employing salesmen in selling cattle at these yards and has made an allowance for salaries which was based on pure speculation and was wholly inadequate to meet the cost of the service; that he has substituted in place of his accountants' figures as to actual expenditures, with respect to the item entitled "Business Getting and Maintaining Expense," a hypothetical allowance greatly less than actual cost; and that the Secretary has thus made findings without evidence and an order, essentially arbitrary, which prescribed unreasonable rates.
Under the circumstances, should the district court have enjoined the order of the Secretary of Agriculture?
The U.S. Supreme Court reversed the district court's decrees dismissing plaintiff market agencies' bills of complaint to enjoin the enforcement of an order of the Secretary of Agriculture (Secretary) fixing the maximum rates to be charged by them for buying and selling livestock. In particular, the district court erred in striking out allegations in plaintiffs' complaints that the Secretary had failed to give them a proper hearing as required by 7 U.S.C.S. § 211 of the Packers and Stockyards Act. Specifically, plaintiffs alleged that the Secretary made the rate order without having heard or read any of the evidence and without having heard the oral arguments or having read or considered the briefs that plaintiffs submitted. Plaintiffs alleged that the only information that the Secretary had as to the proceeding was what he derived from consultation with employees of the department. Plaintiffs rightly contended that the granting of a full hearing was a prerequisite to the Secretary's making of a valid order. Further, the proceeding envisioned by the statute was of a quasi-judicial character where the one who decided must also hear.