DocketNumber： 74-165
Judges： Brennan, Burger, White, Marshall, Blackmun, Powell, Rehnquist, Douglas, Stewart
Filed Date： 12/16/1974
Status： Precedential
Modified Date： 10/19/2024
delivered the opinion of the Court.
These direct appeals and the cross-appeal are from a judgment of a three-judge District Court for the Eastern District of Pennsylvania that declared the Regional Rail Reorganization Act of 1973 (Rail Act), 87 Stat. 985, 45 U. S. C. § 701 et seq. (1970 ed., Supp. Ill), unconstitutional in part and enjoined its enforcement.
I
Introduction
A rail transportation crisis seriously threatening the national welfare was precipitated when eight major railroads in the northeast and midwest region of the country
1. Reorganization of each railroad in § 77 reorganization must proceed pursuant to the Rail Act unless the district court having jurisdiction over its reorganization (a) finds, within 120 days after January 2, 1974, “that the railroad is reorganizable on an income basis within a reasonable time under section [77] and that the public interest would be better served by such a reorganization
4. The Special Court next determines whether the conveyances of the rail properties to Conrail “(A) ... are in the public interest and are fair and equitable to the estate of each railroad in reorganization in accordance with the standard of fairness and equity applicable to the approval of a plan of reorganization . . . under section [77] . . . [or] (B) whether the transfers or conveyances are more fair and equitable than is required as a constitutional minimum.” § 303 (c), 45 U. S. C. § 743 (c)
5. Although railroads in reorganization subject to the Act are free to abandon service and dispose as they wish of any rail properties not designated for transfer under the Final System Plan, §§ 304 (a)-(c), 45 U. S. C. §§ 744
II
Proceedings in the District Court
Constitutional questions concerning the Act are raised in this litigation by parties with interests in the Penn Central Transportation Co. (Penn Central), the largest of the eight railroads in reorganization.
“[W]e are persuaded that a significant possibility exists that a point of erosion either has been or may soon be reached so that it can be said that [the contention of plaintiffs below] of interim unconstitu*119 tional taking by continued loss operations is ripe for adjudication.” 383 F. Supp., at 525.
The District Court rejected the argument of the United States, USRA, and the Penn Central Trustees that if in fact the constitutional limit of permissible uncompensated erosion should be passed, plaintiffs would have an adequate remedy at law in the Court of Claims under the Tucker Act, 28 U. S. C. § 1491. The District Court construed the Rail Act as precluding a Tucker Act remedy, stating:
“We are persuaded that the legislative history supports the conclusion that Congress intended that financial obligations be limited to the express terms of the Act. Article I, Section 9, Clause 7 [of the Constitution] provides that no money shall be drawn from the Treasury of the United States except in consequence of an appropriation made by law. Section 213 (b) [of the Rail Act], and section 214 entitled ‘Authorization for Appropriations’ place an express ceiling on expenditures. Section 210 describes the maximum obligational authority of [USRA], and the authorization for appropriation is limited to ‘such amounts as are necessary to discharge the obligations of the United States arising under this section.’ (Emphasis supplied.) Judicial review is delineated with specificity in Sections 209 (a) and 303 with no mention of the Court of Claims.” 383 F. Supp., at 528-529.
The District Court therefore declared § 304 (f) governing interim abandonments
“null and void as violative of the Fifth Amendment of the United States Constitution, to the extent that it would require continued operation of rail services at a loss in violation of the constitutional rights of the owners and creditors of a railroad.”
“from taking any action to enforce the provisions of Section 304 (f) ... with respect to any abandonment, cessation, or reduction of service which has been or may hereafter be determined by a court of competent jurisdiction to be necessary for the preservation of rights guaranteed by the United States Constitution.”
The District Court also declared that § 303 relating to the final conveyance of rail properties pursuant to the Final System Plan is
“null and void as contravening the Fifth Amendment . . . insofar as it fails to provide compensation for interim erosion pending final implementation of the Final System Plan . . . .”
Finally, the District Court enjoined USRA “from certifying a Final System Plan to the Special Court pursuant to Section 209 (c).” 383 F. Supp., at 530.
The Rail Act was also challenged in the District Court as not “uniform” within the requirement of Art. I, § 8, cl. 4, of the Constitution, which provides that Congress shall have the power to enact “uniform Laws on the subject of Bankruptcies throughout the United States.” The District Court dismissed this contention as without merit except as to one provision of § 207 (b). The section provides that if any reorganization court determines in the 180-day proceedings under § 207 (b) that the Act does not provide a fair and equitable process for the reorganization of a debtor, the debtor shall not be reorganized pursuant to the Act, and the reorganization court “shall dismiss the reorganization proceeding.” The District Court declared this part of § 207 (b) “null and void, as violative of Article I, Section 8, Clause 4 ...,”
Ill
The Issues for Decision
The major issues dividing the parties are (1) whether an action at law in the Court of Claims under the Tucker Act, 28 U. S. C. § 1491, will be available to recover any deficiency of constitutional dimension in the compensation provided under the Rail Act for either the alleged “erosion taking” or the alleged “conveyance taking,” and (2) if the Tucker Act remedy is available, whether it is an adequate remedy. The United States, USRA, and the Penn Central Trustees contend that if resort to a supplemental remedy under the Tucker Act is necessary, it is both available and adequate. The plaintiffs below contend that the Rail Act precludes resort to the Tucker Act remedy, and if it does not, that the remedy is inadequate.
The Special Court, speaking through Judge Friendly, comprehensively canvassed both issues, and in a thorough opinion, concluded that the Rail Act does not bar any necessary resort to the Tucker Act remedy and that the remedy is adequate. Our independent examination of the issues brings us to the same conclusion, substantially for the reasons stated by Judge Friendly in Parts VII and VIII-A of the Special Court opinion. 384 F. Supp. 895, 938-951 (1974).
IV
A
The Alleged “Erosion Taking”
In its opening brief, the United States, speaking for all federal parties except USRA, argued that the case involved no “erosion taking” because, as a matter of law, eompelled-loss operations pending implementation of the Final System Plan would not constitute a taking of the property of the claimants against the bankrupt railroad estates. The argument was that the general rule that if the railroad “be taken to have, granted to the public an interest in the use of the railroad it may withdraw its grant by discontinuing the use when that use can be kept up only at a loss,” Brooks-Scanlon Co. v. Railroad Comm’n of Louisiana, 251 U. S. 396, 399 (1920); see also Bullock v. Florida ex rel. Railroad Comm’n, 254 U. S. 513 (1921); Railroad Comm’n of Texas v. Eastern Texas R. Co., 264 U. S. 79 (1924), is qualified by the requirement that a railroad estate suffer interim losses for a reasonable period pending good-faith efforts to develop a feasible reorganization plan if the public interest in continued
“Difficulties now unforeseen and unanticipated could in fact delay final implementation of the final system plan. For example, Congress could, in theory, successively disapprove several proposed final system plans. Thus, whatever the probabilities, the parties and this Court have no absolute assurance that the plan will in fact be implemented within a reasonable time. For that reason, we have determined that a taking of property through interim erosion, although extremely unlikely, remains a theoretical possibility under the Rail Act.
“Accordingly, we believe that an injunction preventing [USRA] from denying applications for discontinuance of service under Section 304 (f) in those circumstances might be appropriate unless, as we contend, a remedy for any otherwise uncompensated taking will be available under the Tucker Act. We are therefore persuaded that this Court must reach and decide the 'Tucker Act question’ presented by these appeals.” (Footnote omitted.)
We conclude in any event that the availability of a Tucker Act remedy if the Rail Act effects an “erosion taking” is ripe for adjudication. It is true that there has been no definitive determination that erosion of the Penn Central estate has reached unconstitutional dimen
B
Availability of the Tucker Act Remedy for Any “Erosion Taking”
The Tucker Act, 28 U. S. C. § 1491, provides in pertinent part:
"The Court of Claims shall have jurisdiction to render judgment upon any claim against the United States founded either upon the Constitution, or any Act of Congress, or any regulation of an executive department, or upon any express or implied contract*126 with the United States, or for liquidated or unliqui-dated damages in cases not sounding in tort.”
A claim founded upon a taking of property for public use by operation of the Rail Act without just compensation in violation of the Fifth Amendment plainly would fall within the literal words of “any claim against the United States founded . . . upon the Constitution . . . The District Court, however, inquired whether the Rail Act affirmatively provided the Tucker Act remedy, and held that to “read a Tucker Act remedy into the [Rail] Act” would be “judicial legislation on a grand, if not arrogant, scale.” 383 F. Supp., at 529.
The District Court made the wrong inquiry. The question is not whether the Rail Act expresses an affirmative showing of congressional intent to permit recourse to a Tucker Act remedy. Rather, it is whether Congress has in the Rail Act withdrawn the Tucker Act grant of jurisdiction to the Court of Claims to hear a suit involving the Rail Act “founded . . . upon the Constitution.” For we agree with the Special Court that
“the true issue is whether there is sufficient proof that Congress intended to prevent such recourse. The [Rail] Act being admittedly silent on the point, the issue becomes whether the scheme of the [Rail] Act, supplemented by the legislative history, sufficiently evidences a Congressional intention to withdraw a remedy that would otherwise exist.” 384 F. Supp., at 939.
Our decisions affirm that this is the correct inquiry. The general rule is that whether or not the United States so intended, “[i]f there is a taking, the claim is ‘founded upon the Constitution and within the jurisdiction of the Court of Claims to hear and determine." United States v. Causby, 328 U. S. 256, 267 (1946). “[I]f the authorized action . . . does constitute a taking of property for
We turn then to the inquiry whether the Rail Act withdrew the Tucker Act remedy “that would otherwise exist.” 384 F. Supp., at 939. The argument that it should be so read rests on provisions of the Rail Act said plainly to evince Congress’ determination that no federal funds beyond those expressly committed by the Act were to be paid for the rail properties.
The first provision referred to is § 209 which provides for the impaneling of the Special Court and the consolidation before it of “all judicial proceedings with respect to the final system plan.” The argument attaches significance to the omission in § 303 of any authority in the Special Court to enter a judgment against the United States. Reliance is also placed on two of the Act’s funding provisions. Section 210 (b), captioned “Maxi
But these provisions at least equally support the inference that Congress was so convinced that the huge sums provided would surely equal or exceed the required constitutional minimum that it never focused upon the possible need for a suit in the Court of Claims. That this may very well have been the ease is evident in a statement in the House Report:
“The timely implementation of the Final System Plan cannot be obstructed by controversy over the payment for the properties. The Committee is of the opinion that provisions of this title of the [Rail] Act, and especially the provision for deficiency judgment and payment of obligations of [USRA] . . . are more than adequate to guarantee that the creditors of the bankrupt railroad will receive all that they may Constitutionally claim. In view of these extraordinary protections, no litigation should be permitted to delay the Final System Plan.” H. Rep. 55.
That inference also finds support in the provision of
Finally, the manner in which Congress in § 601, 45 U. S. C. § 791 (1970 ed., Supp. Ill), expressly addressed the Rail Act’s “Relationship to other laws” plainly implies that Congress gave no thought to consideration of withdrawal of the Tucker Act remedy. Section 601 (a) (2) provides that the “antitrust laws are inapplicable with respect to any action taken to formulate or implement the final system plan . . .”; § 601 (b) provides that “[t]he provisions of the Interstate Commerce Act and the Bankruptcy Act are inapplicable to transactions under this chapter to the extent necessary to formulate and implement the final system plan whenever a provision of any such Act is inconsistent with this chapter”; § 601 (c) provides that, “[t]he provisions of section 4332 (2) (C) of Title 42 [National Environmental Policy Act of 1969] shall not apply with respect to any action taken under authority of this chapter before the effective date of the final system plan.” Yet despite this clear evidence that Congress was aware of the necessity to deal expressly with inconsistent laws., Congress nowhere addresses the Tucker Act question.
It is argued that any uncertainty in the scheme and text of the Rail Act is cleared up by legislative history from the House and the Senate that discloses that Congress meant the Rail Act to withdraw the jurisdiction of the Court of Claims under the Tucker Act. To the con
*130 “If we did nothing while continuing to mandate rail service, there is the distinct possibility in view of the prior action of Congress that a number of these people could make a claim against the Government which could be sustained in the Court of Claims.”17
Finally, reliance is put upon what is referred to as "subsequent legislative history” in the form of statements, by Congressmen during Oversight Hearings of the House Subcommittee on Transportation and Aeronautics on June 14, 1974, and on an amicus brief filed in this Court on behalf of 36 Congressmen. But post-passage remarks of legislators, however explicit, cannot serve to change the legislative intent of Congress expressed before the Act’s passage. See, e. g., United States v. Mine Workers of America, 330 U. S. 258, 282 (1947). Such statements “represent only the personal views of these legislators, since the statements were fmade] after passage of the Act.” National Woodwork Manufacturers Assn. v. NLRB, 386 U. S. 612, 639 n. 34 (1967). Moreover, during oral argument before this Court, Representative Adams, spokesman for the congressional group, expressly conceded that circumstances might arise when the Tucker Act remedy would be available:
“QUESTION: So you do anticipate a situation where thé Tucker Act would be available?
“MR. ADAMS: Oh, yes. Let’s say, for example, that after this is all over — and this is the three-judge court’s problem — that if a party comes in and says,*133 you held us beyond the constitutional limit on erosion and at that point we are of the opinion that it went just too long, it was unreasonable, but that is a specific individual case at that point.
“QUESTION: And so the Tucker Act, you think, would be available in that situation?
“MR. ADAMS: Of course. We did not repeal the Tucker Act.”19 (Emphasis supplied.)
In sum, we cannot find that the legislative history supports the argument that the Rail Act should be construed to withdraw the Tucker Act remedy. The most that can be said is that the Rail Act is ambiguous on the question. In that circumstance, applicable canons of statutory construction require us to conclude that the Rail Act is not to be read to withdraw the remedy under the Tucker Act.
One canon of construction is that repeals by implication are disfavored; See, e. g., Mercantile National Bank v. Langdeau, 371 U. S. 555, 565 (1963); United States v. Borden Co., 308 U. S. 188, 198-199 (1939); Arnell v. United States, 384 U. S. 158, 165-166 (1966). Rather, since the Tucker Act and the Rail Act are “capable of co-existence, it is the duty of the courts, absent a clearly expressed congressional intention to the contrary, to re
“A new statute will not be read as wholly or even partially amending a prior one unless there exists a ‘positive repugnancy’ between the provisions of the new and those of the old that cannot be reconciled. . . . This principle rests on a sound foundation. Presumably Congress had given serious thought to the earlier statute, here the broadly based jurisdiction of the Court of Claims. Before holding that the result of the earlier consideration has been repealed or qualified, it is reasonable for a court to insist on the legislature’s using language showing that it has made a considered determination to that end....” 384 F. Supp., at 943.
The other relevant canon of construction that comes into play is that when a statute is ambiguous, “construction should go in the direction of constitutional policy.” United States v. Johnson, 323 U. S. 273, 276 (1944). There are clearly grave doubts whether the Rail Act would be constitutional if a Tucker Act remedy were not available as compensation for any unconstitutional erosion not compensated under the Act itself. In such case, as the Special Court observed, “[w]hen one admissible construction will preserve a statute from unconstitutionality and another will condemn it, the former is favored even if language, . . . and arguably the legislative history point somewhat more strongly in another way.” 384 F. Supp., at 944. In other words our “task is not to destroy the Act if we can, but to construe it, if consistent with the will of Congress, so as to comport with constitutional limitations.” CSC v. Letter Carriers, 413 U. S. 548, 571 (1973).
Lynch v. United States, 292 U. S. 571 (1934), fully sup
“Fifth. There is a suggestion that although, in repealing all laws ‘granting or pertaining to yearly renewable term insurance,’ Congress intended to take*136 away the contractual right, it also intended to take away the remedy; that since it had power to take away the remedy, the statute should be given effect to that extent, even if void insofar as it purported to take away the contractual right. The suggestion is at war with settled rules of construction. It is true that a statute bad in part is not necessarily void in its entirety. A provision within the legislative power may be allowed to stand if it is separable from the bad. But no provision however unobjectionable in itself, can stand unless it appears both that, standing alone, the provision can be given legal effect and that the legislature intended the unobjectionable provision to stand in case other provisions held bad should fall. Dorchy v. Kansas, 264 U. S. 286, 288, 290. Here, both those essentials are absent. There is no separate provision in § 17 dealing with the remedy; and it does not appear that Congress wished to deny the remedy if the repeal of the contractual right was held void under the Fifth Amendment.” 292 U. S., at 586.
Similarly, “[t]here is no separate provision in [the Rail Act] dealing with the [Tucker Act] remedy; and it does not appear [from the statute or its legislative history] that Congress wished to deny the remedy” if the Rail Act should cause an “erosion taking” that would require the payment of just compensation.
We accordingly hold that the Tucker Act remedy is not barred by the Rail Act but is available to provide just compensation for any “erosion taking” effected by the Rail Act.
y
A
The Alleged “Conveyance Taking”
The District Court declined to decide whether the provisions governing the procedures for and terms of the
Briefly, the challenges to the final-conveyance provisions assert that the Rail Act is basically an eminent domain statute and, because compensation is not in cash but largely in stock of an unproved entity, will necessarily work an unconstitutional taking.
All of the parties now urge that the “conveyance taking” issues are ripe for adjudication. However, because issues of ripeness involve, at least in part, the existence of a live “Case or Controversy,”
The District Court’s holding of prematurity was influenced by the statutory scheme that requires several decisional steps before the final conveyance. The possibility that the reorganization court might determine under § 207 (b) that the Rail Act process is not fair and equitable to the railroad estate, or that Congress might disapprove the Final System Plan, § 208 (a), or that the Special Court would not order the final conveyance pursuant to § 303 (b), led the District Court to conclude that the question whether the final-conveyance provisions are constitutional was “too speculative to warrant antieipa-
But subsequent to the District Court’s opinion, the Penn Central Reorganization Court determined that the Rail Act did not provide a process that would be fair and equitable to the estate, In re Penn Central Trans. Co., 382 F. Supp. 856 (ED Pa. 1974). On appeal to the Special Court under § 207 (b), that determination has been reversed, although the Special Court has not rendered its judgment, pending our decision of this case. 384 F. Supp., at 955. See n. 14, supra.
We agree with the parties that this change in circumstance has substantially altered the posture of the case as
First, the implementation of the Rail Act will now lead inexorably to the final conveyance, although the exact date of that conveyance cannot be presently determined. It is true that Congress can reject the first plan presented to it by the USRA, § 208 (a), and that the Rail Act, while prescribing with precision the timing of the presentation of that plan, §§ 207 (c) and (d), does not mandate the presentation of successive plans at any particular time. The Rail Act does, however, contemplate that USRA will continue to present plans, § 208 (b), until one becomes “effective,” §209 (a). Thus, we must assume there will be compliance with the Rail Act’s mandatory terms in this respect and that a Final System Plan will at some time be certified to the Special Court. § 209 (c).
It appears, then, that the conveyance of Penn Central’s rail properties to Conrail cannot be prevented by the debtor or its creditors or stockholder; and, while the exact terms of the conveyance remain to be decided, an order of the Special Court directing the conveyance is
Thus, occurrence of the conveyance allegedly violative of Fifth Amendment rights is in no way hypothetical or speculative. Where the inevitability of the operation of a statute against certain individuals is patent, it is irrelevant to the existence of a justiciable controversy that there will be a time delay before the disputed provisions will come into effect. Pennsylvania v. West Virginia, 262 U. S. 553, 592-593 (1923); Pierce v. Society of Sisters, 268 U. S. 510, 536 (1925); Carter v. Carter Coal Co., 298 U. S. 238, 287 (1936). “One does not have to await the consummation of threatened injury to obtain preventive relief. If the injury is certainly impending that is enough.” Pennsylvania v. West Virginia, supra, at 593.
True, there are situations where, even though an allegedly injurious event is certain to occur, the Court may delay resolution of constitutional questions until a time closer to the actual occurrence of the disputed event, when a better factual record might be available. Cf. Public
First, decisions to be made now or in the short future may be affected by whether or not the “conveyance taking” issues are now decided. The constitutionality of the final conveyance may be interwoven with the validity of the abandonment provisions. See n. 24, supra. The Penn Central Trustees may delay expending funds for maintenance in the interval before the final conveyance if constitutional doubts linger about ultimate reorganization under the Rail Act. See Reply Brief for Penn Central Trustees 12.
Second, the Act is a carefully structured method for planning and implementing a reorganization scheme. It necessitates the present denial to the railroads in reorganization of options otherwise available. For example, the New Haven Trustee filed in the District Court a motion to dismiss the § 77 proceeding, and to set up an equity receivership to liquidate Penn Central’s assets. So long as reorganization under the Rail Act remains possible, an equity receivership is not available.
Third, and particularly significant, because of the structure of the Act there is no better time to decide the constitutionality of the Act’s mandatory conveyance scheme to minimize or prevent irreparable injury. The precise contours of the Final System Plan will not be known until shortly before its certification to the Special Court.
After the Final System Plan is effective, the Rail Act prohibits initial judicial review of its terms except by the Special Court. §§ 209 (a), 303 (b) (2). And this review is to occur after conveyance, not before.
Thus, we will be in no better position later than we are now to confront the validity of the final-conveyance provisions. Rather, delay in decision will create the serious risk that consideration of the validity of those provisions may either be too hasty to afford protection of rights or too late to prevent the conveyance or assure compensation if the Rail Act were found unconstitutional.
We hold, therefore, that the basic “conveyance taking” issues are now ripe for adjudication. This does not mean however that we need decide now all of the contentions pressed upon us. “Even where some of the provisions
For example, the controversy over the proper valuation theory to be applied to both the rail properties and the stock of Conrail provided as compensation depends upon contingencies that argue forcefully for postponement of its resolution. The parties have stipulated that it will be impossible to ascertain until the Final System Plan is effective which rail properties will be transferred to Conrail, or their value on any valuation theory, or the value of the consideration to be exchanged for the rail properties. App. 205, 319, 371. Thus, it cannot be determined now what impact any particular theory of valuation may have when applied to either side of the equation, nor can we know where the interests of the various parties lie — that is, which methods of valuation would result in higher compensation to the estate or lower cost to Conrail. Rulings on these questions would plainly be rulings upon “hypothetical situations that may or may not [arise].” Longshoremen’s Union v. Boyd, 347 U. S. 222, 224 (1954).
Moreover, valuation issues peculiarly require a much more developed record than has been prepared. Without evidence of actual figures supporting various valuation theories, a court is not able to discern “what legal issues it is deciding, what effect its decision will have on the adversaries, [or] some useful purpose to be achieved in deciding them.” Public Service Comm’n v. Wycoff Co., 344 U. S. 237, 244 (1952). Clearly the record on these issues does not yet provide the “confining circumstances of particular situations,” Communist Party v. SACB, supra, at 72, which best inform constitutional adjudication.
In sum, of the “conveyance taking” issues, we hold ripe for adjudication the questions (a) of the availability of the Tucker Act remedy if the consideration exchanged upon final conveyance of the rail properties is less than the constitutional minimum, (b) whether stocks, however valued, can be part of the consideration for the rail properties, and (c) whether procedural due process will be denied by the statutory process for conveyance. We hold further that decision of the questions concerning the
B
Availability of Tucker Act Remedy for Any “Conveyance Taking”
Whether the Rail Act precludes the availability of the Tucker Act remedy for any amount by which the consideration exchanged for the rail properties finally conveyed falls short of the constitutional minimum need not detain us. The reasons that led to our conclusion that the Rail Act, insofar as it may work an unconstitutional taking due to interim erosion, does not render a Tucker Act remedy unavailable apply equally to the “conveyance taking” issue. No party has suggested that a difference in result can be supported. The Rail Act authorizes inclusion in the Final System Plan of different kinds of consideration in exchange for the rail properties, subject to adjustment by the Special Court to assure fairness and equity. Congress fully expected that this consideration would provide the minimum compensation required by the Constitution; it wished to provide no more. If, however, that hopeful expectation should not be fulfilled, and the consideration exchanged for the rail properties should prove to be less than the constitutional minimum, the Tucker Act will be available as the jurisdictional basis for a suit in the Court of Claims for a cash award to cover any constitutional shortfall.
C
Adequacy of the Tucker Act Remedy for “Conveyance Taking”
It is argued, however, that, even if a Tucker Act remedy remains open, the remedy is inadequate because it fails to cure basic deficiencies in the conveyance provisions of
Primarily, it is contended that the Tucker Act remedy is inadequate because the “conveyance taking” is an exercise of the eminent domain power and therefore requires full cash payment for the rail properties.
This argument fails, however, for two reasons. First, it is extremely questionable whether, even if the Rail Act were on its face an acquisition of private property for public use, the entire value of the property acquired would have to be paid in cash. More important, we believe that there is nothing in the Act fundamentally at odds with the expressed purpose of Congress to supplement the reorganization laws, see H. Rep. 29, and, with the Tucker Act, the Rail Act is valid as a reorganization statute.
No decision of this Court holds that compensation other than money is an inadequate form of compensation under eminent domain statutes. Statements can be found in opinions that the compensation “must be a full and perfect equivalent for the property taken,” Monongahela Navigation Co. v. United States, 148 U. S. 312, 326 (1893); must reimburse “the full and perfect equivalent in money of the property taken,” United States v. Miller, 317 U. S. 369, 373 (1943); and must be the “full monetary equivalent of the property taken,” United States v. Reynolds, 397 U. S. 14, 16 (1970); see also Almota Farmers Elevator & Warehouse Co. v. United States, 409 U. S. 470, 473 (1973).
We need not, however, determine whether compensation in the form of securities would be constitutional if the Rail Act were merely an eminent domain statute;
First, it is contended that despite the express provision of § 301 (b) that Conrail “shall not be an agency or instrumentality of the Federal Government,” 45 U. S. C. § 741 (b) (1970 ed., Supp. Ill), federal participation through federally appointed members of the board of directors constitutes Conrail a federal instrumentality.
Second, it is contended that the Rail Act’s provisions for a compelled conveyance and for the continuation of rail services pending formulation of the Final System Plan constitute the Act a condemnation statute. We see
Finally, it is argued that there are defects in the Rail Act’s provisions for judicial review that identify the Act as an exercise of the eminent domain power. The argument is frivolous. Although the time has not yet arrived for the mandatory transfer to Conrail, the reorganization courts have had a full opportunity to assess the fairness of the Rail Act’s scheme to the rail estates. § 207 (b). The Special Court has reviewed those determinations and under § 303 (c) will have an opportunity to review the terms of the transfer, although not the conveyance itself. In addition, neither the Rail Act itself nor the procedures thereunder finally determine the interests of the respective creditors. Those will be decided in the § 77 reorganization courts, which will distribute to creditors the consideration received for the rail properties. There are, therefore, ample adequate “[ safeguards... to protect the rights of secured creditors ... to the extent of the value of the property.” Wright v. Union Central Life Ins. Co., 311 U. S. 273, 278 (1940); cf. North American Co. v. SEC, 327 U. S. 686 (1946).
We are not to be understood to intimate that the Rail Act proceeding could not result in a compensable taking. We hold only that, since the Rail Act does not on its face exceed the broad scope of congressional power under the Bankruptcy Clause, cf. Continental Illinois Nat. Bank & Trust Co. v. Chicago, R. I. P. R. Co., supra, at 670,
This Act does differ from other reorganization statutes such as §77, however, in that it requires a conveyance before it is possible to ascertain whether this last condition will be met. Thus, the conveyance is mandated without any prior judicial finding that there will be adequate resources in the reorganized company of whatever kind to compensate the debtor estates and, eventually, their creditors. Because of this congressional insistence upon accomplishing the transfer whatever the ultimate equity of the compensation provisions, any deficiency of constitutional magnitude in the value of the limited compensation provided under the Act will indeed be a taking of private property for public use. Cf. North American Co. v. SEC, supra, at 710.
The remaining contentions regarding the validity of the final-conveyance provisions require little discussion in view of the availability of a Tucker Act suit.
The first contention is that, even if considered as a reorganization statute, the Rail Act fails to assure that creditors will receive the full value of their liens in stock or securities. However, we have already held that, because of the possibility that the Rail Act will work a taking, there must be assurance of consideration equal to any constitutional shortfall, and that a Tucker Act remedy is available to provide that assurance. Thus, the value of
Similarly, the availability of the Tucker Act cures what might otherwise be a troublesome problem of procedural due process. The Tucker Act assures that the railroad estates and the creditors will eventually be made whole for the assets conveyed. Complainants evidence no interest in retaining their property for longer than the Rail Act requires. Indeed, their position is really that they want to be free to dispose of it sooner. Thus, there is no interest asserted in retaining the properties themselves; the only interest is in making sure that creditors receive fair compensation for those properties. On the other hand, the procedural sequence is vital to accomplishing the goals of the Act. If judicial review of the terms of the transfer was required before the conveyance could occur, the conveyance might well come too late to resolve the rail transportation crisis. As long as creditors are assured fair value, with interest, for their properties, the Constitution requires nothing more.
VI
Validity of the Rail Act Under Uniformity Requirement of Bankruptcy Clause
We consider finally the contention that, because the Rail Act’s provisions apply only to railroads in reorganization in the “region,” the statute lacks the uniformity required by Art. I, § 8, cl. 4, of the Constitution giving Congress power “To establish . . . uniform Laws on the subject of Bankruptcies throughout the United States.”
The District Court held that “recourse to the bank
The court determined, however, that one provision of the Rail Act is “newly created or added by the [Rail] Act.” Section 207 (b) requires the reorganization court to dismiss the § 77 proceeding if it finds that the railroad is not reorganizable on an income basis within a reasonable time, and that the Rail Act does not provide a process which would be fair and equitable to the estate of the railroad in reorganization. The District Court noted that the New Haven Inclusion Cases, supra, held that inasmuch as the plan disposed of the New Haven’s assets to the Penn Central for continued operations, i 77 could be used to reorganize the enterprise as an investment holding company, “at least where the plan contemplates that the bulk of the rail properties will continue to be operated as a railroad by someone.” 383 F. Supp., at 534. The District Court held that § 207 (b) of the Rail Act precludes a like reorganization under § 77 by requiring dismissal of the § 77 proceedings, and to that extent violates the uniformity clause since this dismissal relates only to debtors within the region covered by the Rail Act.
We need not decide whether the District Court was correct in this respect. Following the decision of the District Court, the Penn Central Reorganization Court issued its 180-day order finding that, although Penn Central is not
There remains, however, another aspect of the uniformity issue for decision. Appellees urge that the entire Rail Act violates the uniformity clause. The argument is that the uniformity required by the Constitution is geographic, Hanover National Bank v. Moyses, 186 U. S. 181, 188 (1902), and since the Rail Act operates only in a single statutorily defined region, the Act is geographically nonuniform.
The argument has a certain surface appeal but is without merit because it overlooks the flexibility inherent in the constitutional provision. Section 77 was upheld against a like challenge on the ground of the “capacity of the bankruptcy clause to meet new conditions as they have been disclosed as a result of the tremendous growth of business and development of human activities from 1800 to the present day.” Continental Illinois Nat. Bank & Trust Co. v. Chicago, R. I. &
The uniformity provision does not deny Congress power to take into account differences that exist between different parts of the country, and to fashion legislation to resolve geographically isolated problems. “The problem dealt with [under the Bankruptcy Clause] may present significant variations in different parts of the country.” Wright v. Vinton Branch, 300 U. S. 440, 463 n. 7 (1937). We therefore agree with the Special Court that the uniformity clause was not intended “to hobble Congress by forcing it into nationwide enactments to deal with conditions calling for remedy only in certain regions.” 384 F. Supp., at 915.
The national rail transportation crisis that produced the Rail Act centered in the problems of the rail carriers operating in the region defined by the Act, and these were the problems Congress addressed.
The uniformity clause requires that the Rail Act apply equally to all creditors and all debtors, and plainly this Act fulfills those requirements. Vanston Bondholders Protective Committee v. Green, 329 U. S. 156, 172 (1946) (Frankfurter, J., concurring). “No provision of the Act restricts the right of any creditor wheresoever located to obtain relief because of regionalism.” 383 F. Supp., at 519.
Our construction of the Bankruptcy Clause’s uniformity provision comports with this Court’s construction of other “uniform” provisions of the Constitution. The Head Money Cases, 112 U. S. 580 (1884), involved the levy on ships’ agents or owners of a 50-cent tax for any passenger not a United States citizen who entered an American port from a foreign port “by steam or sail vessel.” Individuals engaged in transporting passengers from Holland to the United States challenged the levy as contrary to Art. I, § 8, cl. 1, under which Congress is empowered to lay and collect “all Duties, Imposts and Excises [which] shall be uniform throughout the United States.” The argument was that the head tax violated the uniformity clause because it was not also levied on noncitizen passengers entering this country by rail or other inland mode of conveyance. The Court upheld the tax, stating:
“The tax is uniform when it operates with the same force and effect in every place where the subject of it is found. The tax in this case ... is uni*161 form and operates precisely alike in every port of the United States where such passengers can be landed.” 112 U. S., at 594.
That the tax was not imposed on noncitizens entering the Nation across inland borders did not render the tax nonuniform since “the evil to be remedied by this legislation has no existence on our inland borders, and immigration in that quarter needed no such regulation.” Id., at 595. Similarly, the Rail Act is designed to solve “the evil to be remedied,” and thus satisfies the uniformity requirement of the Bankruptcy Clause. The argument that the Rail Act differs from the head- tax statute because by its own terms the Rail Act applies only to one designated region is without merit. The definition of the region does not obscure the reality that the legislation applies to all railroads under reorganization pursuant to § 77 during the time the Act applies.
Reversed.
The judgment was entered in three consolidated cases. One action was brought in the District Court for the Eastern District of Pennsylvania by Connecticut General Insurance Corp. and others against the United States, the United States Railway Association (USRA), and the Secretaries of Treasury and Transportation and the Chairman of the Interstate Commerce Commission in their capacities as incorporators and directors of USRA. A second action was brought in the District Court for the District of Columbia by Penn Central Co., a creditor and the sole stockholder of Penn Central Transportation Co. (Penn Central), now in reorganization under § 77 of the Bankruptcy Act, against the same defendants named in the first action. A third action was brought in the District Court for the District of Columbia by Richard J. Smith, Trustee of the property of the New York, New Haven & Hartford Railroad Co. (New Haven Trustee) against the United States, USRA,
Three direct appeals and one cross-appeal from the District Court’s judgment were consolidated for decision in this Court. No. 74r-165 is the appeal of the Trustees of Penn Central; No. 76-167 is the appeal of USRA; No. 74-168 is the appeal of the United States; and No. 74-166 is the cross-appeal of the New Haven Trustee.
The Rail Act defines “Region” as the "States of Maine, New Hampshire, Vermont, Massachusetts, Connecticut, Rhode Island, New York, New Jersey, Pennsylvania, Delaware, Maryland, Virginia, West Virginia, Ohio, Indiana, Michigan, and Illinois; the District of Columbia; and those portions of contiguous States in which are located rail properties owned or operated by railroads doing business primarily in the aforementioned jurisdictions (as determined by the [Interstate Commerce] Commission by order).” § 102 (13), 45 U. S. C. § 702 (13) (1970 ed., Supp. III)'’. ICC Order Ex parte No. 293, approved January 14, 1974, delineated areas near Louisville, ICy.; St. Louis, Mo.; and Kewaunee and Manitowoc, Wis., as included in the Region. 39 Fed. Reg. 3605 (1974).
In addition to Penn Central, the railroads are the Reading (In re Reading Co., Bky. No. 71-828, ED Pa.), Erie Lackawanna (In re Erie Lackawanna R. Co., No. B72-2838, ND Ohio), Central of New Jersey (In re Central R. Co. of New Jersey, No. B401-67, N. J.), Lehigh Valley (In re Lehigh Valley R. Co., Bky. No. 70-432, ED Pa.), Boston & Maine (In re Boston & Maine Corp., Bky. No. 70-250-M, Mass.), Ann Arbor (In re Ann Arbor R. Co., Bky. No.
The following lessors of leased lines of Penn Central also filed §77 petitions in the District Court for the Eastern District of Pennsylvania in Bky. No. 70-347: United New Jersey Railroad & Canal Co.; Beech Creek Railroad Co.; Cleveland, Cincinnati, Chicago & St. Louis Railway Co.; Cleveland & Pittsburgh Railroad Co.; Connecting Railway Co.; Delaware Railroad Co.; Erie & Pittsburgh Railroad Co.; Michigan Central Railroad Co.; Northern Central Railway Co.; Penndel Co.; Philadelphia, Baltimore & Washington Railroad Co.; Philadelphia & Trenton Railroad Co.; Pittsburgh, Youngstown & Ashtabula Railway Co.; Pittsburgh, Fort Wayne & Chicago Railway Co.; and Union Railroad Co. of Baltimore.
These included the Emergency Rail Services Act of 1970, 84 Stat. 1975, 45 U. S. C. § 661 et seq., which authorized the Secretary of Transportation to guarantee up to $125 million in certificates issued by trustees of railroads in reorganization if he found, inter alia, that there was a threat of imminent cessation of essential rail services and that the only practicable means of meeting expenses necessary to continue such services was the issuance of such guaranteed certificates.
The Erie Lackawanna and Boston & Maine reorganization courts each determined that its railroad is reorganizable on an income basis within a reasonable time; reorganization of those railroads will not proceed under the Rail Act. In re Erie Lackawanna R. Co.,-F. Supp.- (ND Ohio 1974); In re Boston & Maine Corp., 378 F. Supp. 68 (Mass. 1974).
Three reorganization courts found that the Rail Act does not provide a process that is fair and equitable to the estates of the railroads under their jurisdiction. In re Penn Central Trans. Co., 382 F. Supp. 856 (ED Pa. 1974); In re Lehigh Valley R. Co., 382 F. Supp. 854 (ED Pa. 1974); In re Penn Central Trans. Co. (Secondary Debtors), 382 F. Supp. 821 (ED Pa. 1974); In re Central R. Co. of New Jersey, -F. Supp. - (NJ 1974); In re Lehigh & Hudson River R. Co., 377 F. Supp. 475 (SDNY 1974). The Special Court established under §209 (b), see n. 7, infra, on September 30, 1974, reversed the orders in those cases and directed reorganization under the Rail Act, 384 F. Supp. 895.
Two other reorganization courts held that the Rail Act does provide a fair and equitable process and ordered that reorganization proceed under the Rail Act. In re Reading Co., 378 F. Supp. 481 (ED Pa. 1974); In re Ann Arbor R. Co., - F.'Supp. — (ED Mich. 1974).
Section 209 (b) provides in pertinent part:
■'‘Within 30 days after January 2, 1974, [USRA] shall make application to the judicial panel on multi-district litigation authorized by section 1407 of Title 28 for the consolidation
The Judicial Panel on Multidistrict Litigation selected Circuit Judge Henry J. Friendly, Circuit Judge Carl McGowan, and District Judge Roszel C. Thomsen to compose the Special Court.
Section 206 (c) provides as follows for the designation of rail properties for the Final System Plan:
“ (c) Designations.
“The final system plan shall designate—
“(1) which rail properties of railroads in reorganization in the
"(A) shall be transferred to [Conrail];
“(B) shall be offered for sale to a profitable railroad operating in the region and, if such offer is accepted, operated by such railroad; the plan shall designate what additions shall be made to the designation under subparagraph (A) of this paragraph in the event such profitable railroad fails to accept such offer;
“(C) shall be purchased, leased, or otherwise acquired from [Conrail] by the National Railroad Passenger Corporation . . . ;
“(D) may be purchased or leased from [Conrail] by a State or a local or regional transportation authority to meet the needs of commuter and intercity rail passenger service; and
“(E) if not otherwise required to be operated by [Conrail], a government entity, or a responsible person, are suitable for use for other public purposes, including highways, other forms of transportation, conservation, energy transmission, education or health care facilities, or recreation .. . ; and
“(2) which rail properties of profitable railroads operating in the region may be offered for sale to [Conrail] or to other profitable railroads operating in the region subject to paragraphs (3) and (4) of subsection (d) of this section.”
Section 206 (d) provides as follows respecting transfers to Conrail: “(d) Transfers.
“All transfers or conveyances pursuant to the final system plan shall be made in accordance with, and subject to, the following principles:
“(1) All rail properties to be transferred to [Conrail] by a profitable railroad, by trustees of a railroad in reorganization, or by any railroad leased, operated, or controlled by a railroad in reorganization in the region, shall be transferred in exchange for stock and other securities of [Conrail] (including obligations of [USRA]) and the other benefits accruing to such railroad by reason of such transfer.”
Sections 210 (b), 213, 214, and 215 provide as respects federal funds as follows:
“(b) Maximum obligations! authority.
“Except as otherwise provided in the last sentence of this subsec
“(a) Emergency assistance.
“The Secretary is authorized, pending the implementation of the final system plan, to pay to the trustees of railroads in reorganization such sums as are necessary for the continued provision of essential transportation services by such railroads. Such payments shall be made by the Secretary upon such reasonable terms and conditions as the Secretary establishes, except that recipients must agree to maintain and provide service at a level no less than that in effect on January 2,1974.
“ (b) Authorization for appropriations.
“There are authorized to be appropriated to the Secretary for carrying out this section such sums as are necessary, not to exceed $85,000,000, to remain available until expended.” § 213, 45 U. S. C. § 723 (1970 ed., Supp. III).
“(a) Secretary [of Transportation],
“There are authorized to be appropriated to the Secretary for purposes of preparing the reports and exercising other functions to be performed by him under this chapter such sums as are necessary, not to exceed $12,500,000, to remain available until expended.
“(b) Office.
“There are authorized to be appropriated to the [Interstate Commerce] Commission for the use of the Office in carrying out its func
“(c) Association.
“There are authorized to be appropriated to [USRA] for purposes of carrying out its administrative expenses under this chapter such sums as are necessary, not to exceed $26,000,000, to remain available until expended.” §214, 45 U. S. C. §724 (1970 ed., Supp. III).
“Prior to the date upon which rail ' properties are conveyed to [Conrail] under this chapter, the Secretary, with the approval of [USRA], is authorized to enter into agreements with railroads in reorganization in the region (or railroads leased, operated, or controlled by railroads in reorganization) for the acquisition, maintenance, or improvement of railroad facilities and equipment necessary to improve property that will be in the final system plan. Agreements entered into pursuant to this section shall specifically identify the type and quality of improvements to be made pursuant to such agreements. Notwithstanding section 720 (b) of this title, [USRA] shall issue obligations under section 720 (a) of this title in an amount sufficient to finance such agreements and shall require [Conrail] to assume any such obligations. However, [USRA] may not issue obligations under this section in an aggregate amount in excess of $150,000,000. . . .” §215, 45 U. S. C. §725 (1970 ed., Supp. III).
The period of 450 days provided by § 207 (c) was extended 120 days by Pub. L. 93-488, 88 Stat. 1465, effective Oct. 26, 1974.
Concerning congressional review of the Final System Plan, § 208 provides:
“(a) General.
“The Board of Directors of [USRA] shall deliver the final system plan adopted by [USRA] to both Houses of Congress and to'the Committee on Interstate and Foreign Commerce of the House of Representatives and the Committee on Commerce of the Senate. The final system plan shall be deemed approved at the end of the first period of 60 calendar days of continuous session of Congress after such date of transmittal unless either the House of Representa
"(b) Revised plan.
“If either the House or the Senate passes a resolution of disapproval under subsection (a) of this section, [USRA],- with the cooperation and assistance of the Secretary and the Office, shall prepare, determine, and adopt a revised final system plan. Each such revised plan shall be submitted to Congress for review pursuant to subsection (a) of this section.
“(c) Computation.
“For purposes of this section—
“(1) continuity of session of Congress is broken only by an adjournment sine die; and
“(2) the days on which either House is not in session because of an adjournment of more than 3 days to a day certain are excluded in the computation of the 60-day period.” § 208, 45 U. S. C. § 718 (1970 ed., Supp. III).
Section 303 (d) provides:
“(d) Appeal.
“A finding or determination entered pursuant to subsection (c) of this section may be appealed directly to the Supreme Court of the United States in the same manner that an injunction order may be appealed under section 1253 of Title 28: Provided, That such appeal is exclusive and shall be filed in the Supreme Court not more than 5 days after such finding or determination is entered by the special court. The Supreme Court shall dismiss any such appeal within 7 days after the entry of such an appeal if it determines that such an appeal would not be in the interest of an expeditious conclusion of the proceedings and shall grant the highest priority to the determination of any such appeals which it determines not to dismiss.”
We are not required to consider in this case the. validity of this attempted congressional regulation of the Court's disposition of any appeal from a judgment entered by the Special Court pursuant to subsection (c).
The suits here were brought by the major creditors and sole shareholder of Penn Central. Penn Central was the product of the merger of the Pennsylvania Railroad with the New York Central Railroad. Penn-Central Merger Cases, 389 U. S. 486 (1968). A condition of that merger was Penn Central’s promise to take in the New York, New Haven & Hartford Railroad Co. as an operating entity, and that promise was fulfilled. New Haven Inclusion Cases, 399 U. S. 392 (1970).
The Penn Central operation dominates the northeast-midwest region. It serves 55% of the Nation’s manufacturing plants employing 60% of the country’s industrial employees. More than 20% of all freight cars loaded in the United States pass over Penn Central’s 20,000 miles of track, and over 70% of Penn Central traffic involves other railroads. Rail Service in the Midwest and Northeast Region, 39 Fed. Reg. 5392, 5401 (1974); H. R. Rep. No. 93-620, p. 26 (1973) (hereinafter H. Rep.). Since 1973 Penn Central (including its leased lines) accounted for 94% of the operating mileage and 87% of the operating revenues of the six bankrupt railroads involved under the Rail Act. The merger failed to realize anticipated savings and Penn Central entered reorganization proceedings in 1970, two years after the merger was approved. Huge operating losses made reorganization inevitable and have continued. The Financial Collapse of the Penn Central Company, SEC Staff Report 86 (1972). The Penn Central Trustees in a Report of February 10, 1971, Concerning Premises for A Reorganization, Joint Documentary Submission No. 1, concluded that the
For reasons stated in Part VI of this opinion, infra, we have no occasion to pass upon the correctness of this conclusion.
Part VIII-B of the Special Court opinion considers the arguments of investors pf several of the smaller lines. But those investors are not parties to the cases before us.
Part VIII-C of the Special Court’s opinion discusses the question whether the Court of Claims is free to deny the existence of the
The severely limited funds available pursuant to §§ 213 and 215 for emergency assistance and plant maintenance pending implementation of the Final System Plan do not assure that adequate compensation will be available for any “erosion taking.” Section 213 provides $85 million in emergency grants for continued essential transportation services while §215 provides $150 million in TJSRA obligations for maintenance and improvement of plant.
Nor is adequate assurance provided by the possibility that Conrail securities and other benefits can be provided for unconstitutional erosion when the Special Court determines the proper consideration for the rail properties conveyed to Conrail. As the Special Court itself found:
“The Government parties [contend] that . . . this court could compensate for any unconstitutional erosion in the final system
“[*] Tim House version of the Act, as explained by the report accompanying it, provided that ‘[t]he value of consideration must equal the fair and equitable value of the rail properties as of the date of the conveyance.’ House Report at 53. However, the Act contains no such limitation and the Conference Report, H. R. Rep. No. 93-774, 93d Cong., 1st Sess. (1973), makes no mention of the deletion.”
As this passage from Yearsley indicates, the Government action must be authorized. “The taking of private property by an officer of the United States for public use, without being authorized, expressly or by necessary implication, to do so by some act of Congress, is not the act of the Government,” and hence recovery is not available in the Court of Claims. Hooe v. United States, 218 U. S. 322, 336 (1910). See also Youngstown Sheet & Tube Co. v. Sawyer, 343 U. S. 579, 585 (1952). These cases are inapposite since the Government actions at issue here are authorized by the Rail Act.
“Mr. HARTKE. We are providing that the creditors of this corporation would be required to take common stock in the new quasi-government operation: In other words, they are exchanging their present security interest in the rail properties for common stock in the new corporation.
“The railroad properties then become the properties of the new corporation free and clear of liens and encumbrances. In other words, the assets are being transferred and the rights are being changed. The nonrailroad property will remain in the bankruptcy court to be dealt with by them. One can talk about what is available if the railroad is liquidated and put through the wringer, but even then the chances of these creditors getting their money is [sic] relatively slim, and this country cannot afford cessation of rail service while the railroads are put through the wringer. So what, in effect, is called the ‘cram down’ theory forces them to accept this kind of settlement and judges have ruled that this is fair. If we did nothing while continuing to mandate rail service, there is the distinct possibility in view of the prior action of Congress that a number of these people could make a claim against the Government which could be sustained in the Court of Claims.”
“Mr. KUYKENDALL. Mr. Speaker, I would like to ask the gentleman from Washington to clarify one point, and that is the matter of the deficiency judgment. There was a lot of colloquy in the original debate which expressed fears that the Federal court had the key to the Treasury.
“Will the gentleman give us his interpretation of the guarantees we have to keep that from happening in the court proceedings?
“Mr. ADAMS. Mr. Speaker, there is a definite limitation on the total amount that can be authorized under this bill. Any amounts that go beyond that, or the shifting of the way in which it is spent, is to be approved by an act of Congress, to be signed by the President. It is defined as a joint resolution in the bill, and the statement of the managers, and it was the clear intent of the managers that any amount other than common stock was to be at the lowest possible limit to meet the constitutional guarantees.
“Mr. KUYKENDALL. Mr. Speaker, is it not true, I will ask the gentleman from Washington (Mr. Adams) that the creditors, of course, are given protection, and that the Board of Directors, under the control of Government officials, is the owner of the entire block of stock of 100 million shares, whatever it is?
“Mr. ADAMS. The gentleman is correct. It is controlled by the United States, so long as the Secretary determines that there is an
"During that period of time, it is controlled by a board of directors which consists of Government officials.
“Mr. KUYKENDALL. There is no way the Federal court may assess the taxpayers or this Congress on the judgments of the creditors; is that correct?
“Mr. ADAMS. The gentleman is correct.
“Mr. KUYKENDALL. There is no way they can assess the Congress for the money?
“Mr. ADAMS. The gentleman is correct.”
Tr. of Oral Arg. 50-51.
At three other times during oral argument Representative Adams implied that the Tucker Act was available for takings resulting from the Rail Act. See id., at 48 (“As Justice White was asking in his question, is there a right to sue for some failure — maybe we hold a party too long, then they could”); id, at 49 (“Now as far as the Causby case is concerned, Hurley v. Kincaid and the other Tucker Act cases, we did not try to repeal the Fifth Amendment or certainly repeal the Tucker Act jurisdictional statements”); id., at 50 (“If you decide, however, that there may be, some place along the line, in the lawful process, a mistake, then you reach and say the Tucker Act case will have to be decided when and if some party can decide that they have created a case on the merits”).
The conveyance provisions are the heart of the Rail Act. Thus, if it were clear that they were unconstitutional, a strong argument might be made that they are inseverable from the remainder of the Act and that the Act as a whole is void.
The New Haven Trustee in his Reply Brief 45-46 seems to concede that valuation at market value of any Conrail stock may be sufficient. He then suggests, however, that it might be impossible, for legal and practical reasons, to offer Conrail stock publicly for many years. Thus, he claims, there will be no way to ascertain market value, and he implies that the market value will effectively be zero.
Aetna Life Ins. Co. v. Haworth, 300 U. S. 227, 240-242 (1937); Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 U. S. 270, 273 (1941); Joint Anti-Fascist Refugee Committee v. McGrath, 341 U. S. 123, 140-141 (1951); id., at 154 — 155 (Frankfurter, J., concurring).
Ashwander v. TV A, 297 U. S. 288, 346-347 (1936) (Brandeis, J., concurring); Poe v. Ullman, 367 U. S. 497, 502-503 (1961).
Judge Fullam disagreed with the majority below on the ripeness of some of the final-conveyance issues, 383 F. Supp., at 530-533. Among other things, he observed that the validity of the final-conveyance provisions was inextricably interwoven with the issues concerning interim erosion which the three-judge court did address. As suggested, supra, at 122-124, the constitutionality of requiring deficit railroad operations by a railroad in reorganization may depend in part upon the likelihood of a successful reorganization; if the provisions for the final conveyance were facially unconstitutional, there would be little likelihood of such reorganization, and it might be necessary to permit immediate abandonment for that reason alone. 383 F. Supp., at 530-533. We believe, unlike Judge Fullam, that the Tucker Act is available to compensate any unconstitutional taking which might arise from interim erosion. See supra, at 125-136. However, his observation about the interrelationship of the “erosion taking” and the “conveyance taking” issues is still pertinent. If it were entirely clear that no reorganization could take place under the Act because its conveyance provisions were unconstitutional, it might be pointless to permit continuing erosion of the estate and the inevitable buildup of a huge Tucker Act claim. Thus, we would have to decide whether those portions of the Act severely limiting abandonments are severable from the conveyance provisions. Because we find that some of the final-conveyance issues require resolution at this juncture for independent reasons, we need not determine whether we would have to confront any of them anyway in order completely to determine the validity of the abandonment provisions.
It might be appropriate under different circumstances only to decide that the issues are ripe, and to remand to the District Court for their determination on the merits. However, such a remand here would be both undesirable and unnecessary. The Rail Act provides a strict timetable for its implementation. Any delay occasioned by remanding to the District Court could seriously impede that timetable and frustrate the accomplishment of the Rail Act’s objectives. Further, these issues have been fully ventilated by these same parties in the Special Court, which- proceeded to decide them.
The parties have stipulated that “[i]t is likely” that some of the rail properties of Penn Central will be designated for transfer, sale, or other conveyance in any Final System Plan executed under the Rail Act. App. 205, 318-319, 370-371. Since the Penn Central system holds an overwhelming percentage of the trackage, see n. 12,
Section 209 (a) provides: “Notwithstanding any other provision of law, the final system plan ... is not subject to review by any court except in accordance with this section. After the final system plan becomes effective under section 718 of this title, it may be reviewed with respect to matters concerning the value of the rail properties to be conveyed under the plan and the value of the consideration to be received for such properties.”
Section 303 (b)(1) commands that within 10 days after the compensation provided in the Final System Plan has been deposited with the Special Court pursuant to §303 (a), the Special Court “shall” order the conveyance. Section 303 (b) (2) provides that the conveyance “shall not be restrained or enjoined by any court.”
Finally, §303 (c)(1) provides: “After the rail properties have been conveyed . . . the special court . . . shall decide . . . whether the transfers or conveyances .. . are in the public interest and are fair and equitable . . . .” (Emphasis added.) Thus, the statutory command is that once the Final System Plan has been presented to Congress and not disapproved, the Special Court can review it only after it has ordered the conveyance.
The Senate bill contained a provision that might be read as authorizing the Special Court to refuse to order the conveyance if it found it not fair and equitable. S. 2767, §303 (c)(2). See S. Rep. 35. However, this provision was deleted. It seems fundamentally at odds with §§ 303 (b) and (c)(1) of the Senate bill, and with the intent expressed by the Senate Committee Report, as cited in the text. We infer, therefore, that the provision was eliminated at conference precisely to make clear that the order of conveyance is mandatory, and that any litigation concerning valuation is to occur after the transfer. See H. R. Conf. Rep. No. 93-744, pp. 57, 58 (1973), which states that, except for certain provisions not pertinent here, the final bill follows the Senate version of the implementation scheme, “subject to technical and clarifying changes.” (Emphasis added).
For this reason, decisions concerning justiciability of eases of apprehended criminal prosecution are not pertinent. Because the decision to instigate a criminal prosecution is usually discretionary with the prosecuting authorities, even a person with a settled intention to disobey -the law can never be sure that the sanctions of the law will be invoked against him. Further, whether or not the injury will occur is to some extent within the control of the complaining party himself, since he can decide to abandon his intention to disobey the law. For these reasons, the maturity of such disputes for resolution before a prosecution begins is decided on a case-by-case basis, by considering the likelihood that the complainant will disobey the law, the certainty that such disobedience will take a particular form, any present injury occasioned by the threat of prosecution, and the likelihood that a prosecution will actually ensue. Compare Golden v. Zwickler, 394 U. S. 103 (1969), with Albertson v. SACB, 382 U. S. 70 (1965); Steffel v. Thompson, 415 U. S. 452, 459 (1974).
The Final System Plan will become “effective” if it is not disapproved by either house of Congress within 60 calendar days of continuous session from the time it is transmitted to Congress. §§102 (4), 208 (a), 209 (a). After that, it may still have to be changed if USRA is unable to execute agreements with profitable railroads for purchases from the reorganized railroads (within 30 days of the effective date) or for sales to Conrail or to other profitable railroads (within 60 days of the effective date). §206 (d) (4). Thus, it is possible that the Final System Plan to be certi-
The Special Court may have jurisdiction derived from the Constitution itself to refuse to convey if the terms of the transfer are clearly unconstitutional. See supra, at 142. But, as the Special Court noted, any such review would be hasty and made without adequate information. 384 F. Supp., at 931. Thus, while review at this stage is a theoretical possibility, it would not afford a better opportunity than the present one for an informed decision in light of well-developed facts.
See also n. 36, infra.
The House bill attempted to define the valuation theory to be applied to the rail properties conveyed. H. R. 9142, § 102 (5); see H. Rep. 31.. However, the definition of “fair and equitable value” is not in the Rail Act as adopted.
The New Haven Trustee’s contention that the conveyance provisions will constitute a taking because they mandate continuation of rail services indefinitely is similarly premature, because it is premised upon a hypothetical relationship between the railroad’s liquidation value for “highest and best use” and its value as a going concern. Both of these values are by stipulation unknown, and the proper method of valuing the railroad properties is itself not justiciable now.
It is also contended that the Tucker Act is inadequate since Congress may not appropriate the money awarded by the Court of Claims. But, as Mr. Justice Harlan wrote, “there seems to be no sound reason why the Court of Claims may not rely on the good faith of the United States.” Glidden Co. v. Zdanok, 370 U. S. 530, 571 (1962). See also Albert Hanson Lumber Co. v. United States, 261 U. S. 581, 587 (1923); Silesian-American Corp. v. Clark, 332 U. S. 469, 480 (1947).
We reject as well the suggestion that a Tucker Act remedy comes too late. See Hurley v. Kincaid, 285 U. S. 95 (1932). Interest on a just-compensation award runs from the date of the taking. See, e. g., United States v. Thayer-West Point Hotel Co., 329 U. S. 585, 588 (1947). Finally, contrary.to the suggestion of some of the plaintiffs below, we see no reason why a Tucker Act remedy is inadequate because the valuations involved may be complex. Cf. Phillips v. Commissioner, 283 U. S. 589, 596-601 (1931).
All of the arguments concerning inadequacy of the Tucker Act remedy are pressed with regard to both the alleged “erosion taking” and the alleged “conveyance taking.” As with the availability of the Tucker Act remedy, see supra, at 148, there is no distinction between these arguments or their resolutions in the two contexts.
To delay until any Court of Claims adjudication with respect to the form of consideration provided by the Act would be exceedingly irresponsible: while the fact that Congress did not contemplate a taking does not pretermit a Tucker Act remedy, it does suggest that
At least two of the complaining parties agree that, to the extent compensation to the rail estates is paid in obligations of USRA backed by federal guarantees, the securities can be figured at face value as the perfect equivalent of money. Reply Brief for Cross-
The special-benefits rule of compensation may later have direct relevance to the Penn Central reorganization. The Act provides that determination of the fairness and equity of the terms of the transfer should take into account “securities and other benefits” (emphasis added) provided to the railroad estate. §303 (c)(2). See also §206 (d)(1). The parties here disagree about what “other benefits” may be under the Act, and the extent to which any such may be counted as constitutional consideration. In particular, there is a dispute over whether the sums up to $250,000,000 in benefits to be paid Conrail as reimbursement for certain labor expenses are “other benefits” to be counted in evaluating the exchange. See § 509, 45 U. S. C. § 779 (1970 ed., Supp. III). For the reasons given supra, at 146-147, with respect to other valuation problems, this issue is presently premature.
The claim is also made that, whatever the form of compensation proper under the Fifth Amendment, the legislature cannot specify the form of compensation but must leave the decision to the judiciary. This argument is based upon an erroneous reading of Monongahela Navigation Co. v. United States, 148 U. S. 312, 327 (1893). Monongahela held only that the legislature could not, by setting either a fixed amount to be paid for property condemned or a principle for arriving at that amount, settle the constitutional right, to just compensation. Thus, Monongahela did no more than restate the general principle that the courts, not the legislature, are ultimately entrusted with assuring compliance with constitutional commands. It said nothing about whether Congress can dictate the mode of compensation rather than the amount.
Section 301 (d) provides:
“(d) Board of Directors.
“The Board of Directors of [Conrail] shall consist of 15 individuals selected in accordance with the articles and bylaws of [Conrail]: Provided, That so long as 50 per centum or more, as determined by the Secretary of the Treasury, of the outstanding indebtedness of [Conrail] consists of obligations of [USRA] or other debts owing to or guaranteed by the United States, three of the members of such board shall be the Secretary [of Transportation], the Chairman and the president of [USRA] and five of the members of such board shall be individuals appointed as such by the President, by and with the advice and consent of the Senate.”
An attempt is made to distinguish the “cram-down” provisions of § 77 (e) because § 77 (e) provides for a vote of all classes of creditors after the reorganization court has determined that a plan is fair and equitable. A “cram-down” is- permitted only if the reorganization court finds any objection by a class of creditors “not reasonably justified.” But the creditors’ right to object to a plan approved by the court has a severely limited scope. “If a plan gives fair and equitable treatment to dissenters, the elements which make the plan fair and equitable cannot be the basis for a reasonably justified rejection.” RFC v. Denver & R. G. W. R. Co., 328 U. S. 495, 535 (1946). A “reasonable” objection must be based upon facts arising after the original approval of the plan by the court. Ibid. The omission in the Rail Act of this very limited right of objection cannot constitute the Act an eminent domain statute.
Continental Bank expressly notes that § 77 does not represent the limits of the bankruptcy power. 294 U. S., at 671.
None of the parties question that any “taking” effected by the Rail Act will be for “public use.” Cf. Berman v. Parker, 348 U. S. 26 (1954).
The Court observed that it is not unusual for railroads to receive disparate treatment under the bankruptcy laws:
“Railway corporations had been definitely excluded from the operation of the law in 1910 (c. 412, §4, 36 Stat. 838, 839), probably because such corporations could not be- liquidated in the ordinary way or by a distribution of assets. A railway is a unit; it can not be divided up and disposed of piecemeal like a stock of goods. It must be sold, if sold at all, as a unit and as a going concern. Its activities can not be halted because its continuous, uninterrupted operation is necessary in the public interest; and, for the preservation of that interest, as well as for the protection of the various private interests involved, reorganization was evidently regarded as the most feasible solution whenever the corporation had become ‘insolvent or unable to meet its debts as they mature.’ ” 294 U. S., at 671-672.
H. Rep. 25-29; S. Rep. 6-14.