P.O.D. Docket No. 1/184
April 26, 1960
In the Matter of the Petition by
THE INDEPENDENT PETROLEUM ASSOCIATION OF AMERICA,
1110 Ring Building,
Washington 6, D. C.
for a hearing upon its application on for second-class re-entry
of "THE INDEPENDENT PETROLEUM ASSOCIATION OF AMERICA MONTHLY."
P.O.D. Docket No. 1/184
April 26, 1960
William A. Duvall Chief Hearing Examiner
POST OFFICE DEPARTMENT, Washington 25, D. C.,
APPEARANCES:
Russell B. Brown, Esq.,
L. Dan Jones, Esq.,
William I. Powell, Esq.
1110 Ring Building
Washington 6, D. C. for the Petitioner
Adam G. Wenchel, Esq.
Matthias Mahorner, Esq.
Office of the General Counsel
Post Office Department for the Respondent
INITIAL DECISION OF HEARING EXAMINER
The Independent Petroleum Association of America, Washington, D. C., the Petitioner, is a trade association representing independent oil producers and royalty owners in various localities throughout most of the United States. A portion of the dues of each member is allocated to the payment for a subscription to the organization's monthly publication, "The Independent Petroleum Association of America Monthly", hereinafter referred to as "Monthly".
Beginning in 1950, the Association compiled and published every two years a publication known as "The Oil Producing Industry in Your State", hereinafter referred to as "Your State". Although current material has been added as successive issues were published, the publication has been and is composed of statistical data relating to oil and gas exploration, development, production and reserves for each producing state. There is also cumulative information about the industry on a nationwide basis. In 1959, the decision was made that this publication should be issued annually and an announcement to this effect was made in the April, 1959, issue of "Monthly" (Petitioner's Exhibit 1, page 80). Prior to the 1959 issue of "Your State", the publication was not mailed to the Association's members but copies of it were available at mid-year meetings of the Association, and other copies of the publication were sent to persons who submitted written requests for them.
On June 23, 1959, however, the Association filed an application for re-entry of "Monthly" into the mails due to a change of frequency from monthly to monthly with an additional issue in July. While this application was pending, more specifically on or about July 23, 1959, "Your State" was offered and accepted for mailing at the Tulsa, Oklahoma, Post Office. In this connection, it is stated in the Petition that representatives of the Association called upon an official of the Tulsa Post Office and were advised that if the Association added the name of "Monthly" on the front cover of "Your State", this action would qualify the latter insofar as eligibility for second-class mail matter is concerned.
On August 25, 1959, the Respondent advised the Petitioner that the application for re-entry was denied on grounds which were, in substance, that:
(1) the title "Monthly" is subordinate to the title "Your State" on the latter's cover page, and
(2) "Your State" is a reference book or pamphlet and, as such, is not considered a regular issue of "Monthly".
After some intervening correspondence, the ruling by the Director was reaffirmed on September 21, 1959. The Respondent also instructed the Postmaster at Tulsa, Oklahoma, to collect from the Petitioner the difference between the postage paid at the second-class rates and the properly applicable third- or fourth-class postage rates.
The Petitioner filed a timely appeal from this notice by petition, and the Respondent answered, indicating more clearly and specifically the regulations on which the denial was based. In the Answer, it was set forth affirmatively, in addition to the two grounds specified in the Director's rulings, that "Your State" does not qualify as an issue of "Monthly" because it does not bear a date of issue which is distinguishable from the regular issues of "Monthly".
The case came on for hearing before me on December 27, 1959, and both parties were represented by counsel who participated in the introduction of evidence and in the examination of the witness. Proposed findings of fact and conclusions of law, with supporting briefs were submitted on behalf of both parties on February 1, 1960.
The Petitioner asserts that since consultation was had with the Superintendent of Mails at the Tulsa Post Office and advice was received that Exhibit F as it appears in this case is eligible for mailing at the second-class rate, the Department is now estopped from (1) ruling to the contrary and (2) requiring the collection of additional postage at the applicable rate. The Respondent's position is that this matter is not an issue in this proceeding because it is outside the jurisdiction of the Hearing Examiner and the Judicial Officer. The Respondent's position was not supported by any citation of authority at the hearing and none is set forth in his brief.
The question of estoppel is basic to this "proceeding(s) concerning" an application for and denial of second-class mail privileges arising under the pertinent sections of Title 39, United States Code. (Rule 1, Rules of Practice) Notification of the Director's instruction to the Tulsa Postmaster to collect additional postage at the applicable rate was contained in and made a part of the ruling of the Director from which this appeal was taken. While the parties may not agree with the ultimate conclusion made with respect to the issue, each one will have had an opportunity to make his record, and the entire case may then be considered on appeal. I rule that the question of estoppel in this case is a matter for initial determination by the administrative process. This finding is restricted to the questions of (1) the Respondent's right to reverse the Tulsa postal officials, and the Respondent's right to collect postage at the applicable rate. The amount of such additional postage to be collected is a matter for determination by the Respondent.
Do the actions taken by representatives of the Petitioner and by the Superintendent of Mails at the Tulsa Post Office work to create the estoppel alleged by the Petitioner? The Petitioner pointed out that the regulation in which it is specifically stated that "copies of second-class publications will be accepted for mailing at the second-class postage rates during the time applications for re-entry are pending" and the regulation which specifically vested in the Director of the Division of Postal Services the authority initially to rule on all applications relating to second-class mail matters, were published in the Federal Register several days after "Your State" was accepted for mailing at the Tulsa Post Office. (Tr. 18) This fact, in the Petitioner's view, made the Superintendent of Mails, or the Postmaster at Tulsa, the Postmaster General's agent whose acts are, or were at the time in question, binding upon the Postmaster General as the principal.
In support of his argument that the question of estoppel is within the agency's jurisdiction, Counsel for the Petitioner cited and read certain portions of pages 222 and 223 of the 1959-60 United States Government Organization Manual. (Tr. 11) On Page 225 of the same document, where the duties of the Assistant Postmaster General in charge of the Bureau of Operations are described, is the following statement:
"He implements policies concerning the entry, makeup, and classification of domestic mail and the application of postage rates and fees."
An almost identical statement is found on page 217 of the United States Government Organization Manual for 1958-59. Furthermore, it is indicated on the Form 3510 on which the application for re-entry was submitted that action on the application must be taken at the Departmental level (Pet. Ex. A). Thus, the Petitioner's representatives were on notice that final action on applications relating to second-class mail privileges is not taken by local postal officials.
If "Your State" is held to be ineligible for mailing at second-class postage rates, and if the Petitioner's theory of estoppel were valid, the result would be that the Tulsa postal official had committed the Department to do an illegal act, that is, to carry at the low, second-class postage rates matter on which a higher rate of postage was due. The following quotations are pertinent to this portion of the inquiry.
"We have no officers in this Government from the President down to the most subordinate agent, who does not hold office under the law, with prescribed duties and limited authority. And, while some of these, as the President, the Legislature and the Judiciary, exercise powers in some sense left to the more general definitions necessarily incident to fundamental law found in the Constitution, the larger portion of them are the creation of statutory law, with duties and powers prescribed and limited by that law." ( The Floyd Acceptances , 74 U.S. 666)
"***the United States is neither bound nor estopped by acts of its officers or agents in entering into an arrangement or agreement to do or cause to be done what the law does not sanction or permit." ( Utah Power & Light Co. v. United States , 243 U.S. 389.)
"Whatever the form in which the Government functions, anyone entering into an arrangement with the Government takes the risk of having accurately ascertained that he who purports to act for the Government stays within the bounds of his authority." ( Federal Crop Ins. Corp. v. Merrill , 332 U.S. 380.)
Enough has been said to establish that the Director is not estopped in this case by the actions taken by officials of the Tulsa Post Office.
Mr. Melvin L. Mesnard testified at the hearing on behalf of the Petitioner and stated that he is employed as a Petroleum Analyst for the Association. His name does not appear on the masthead of "Monthly", but the masthead of "Your State" shows him to be the Editor and Supervisor of Statistical Research for the latter publication. In his regular capacity with "Monthly", Mr. Mesnard prepares certain statistical studies together with charts to illustrate his articles or articles written by others. With regard to "Your State" almost the entire publication was prepared by Mr. Mesnard or at his direction. (Tr. 32) Out of a printing of more than 20,000 copies, approximately 13,500 of the 1959 "Your State" were dispatched through the mails.
Mr. Mesnard stated that most of the information that is in the 1958 edition of "Your State" is also in the 1959 edition but that the material has been expanded considerably in the 1959 edition and some new material has been added.
On cross-examination, it was stated that beginning in 1950, and for every two years thereafter through 1958, "Your State" was published as a separate and distinct publication from "Monthly". Mr. Mesnard was rather vague as to whether "Your State" is intended to be used as a reference book and as to what he regarded as being the title of the publication, but he did agree that it is an annual. The witness testified that "Your State" was mailed before the July issue of "Monthly" was mailed, but that, insofar as sequence is concerned, the matter of which mailing was first is unimportant. It was also developed that there were two printings of "Your State", as follows:
(1) about 15,000 copies, from which the 13,500 copies were mailed; and
(2) about 5,000 copies which were not mailed but which were retained by the publisher for distribution upon order or request from non-subscribers. The latter group differs from the former in that (1) it does not carry the legend "The Independent Petroleum Association of American Monthly" at the top of the outside front cover; (2) the second-class indicia was omitted from the bottom of the inside front cover; and (3) there is no advertising matter. (Compare Petitioner's Exhibits F and I). 1/
It is pertinent to consider the contents of the 1958 and 1959 editions of "Your State" and "Monthly". (Petitioner's Exhibits F and H)
1959 1958
Introduction 5-11 (graphs, 1-3 (no charts)
charts)
Statistical Summary of Pet-
roleum Producing Industry p. 12 p. 4
Total Wells Drilled p. 13 not carried
Petroleum Production & New
Reserves Found p. 14 not carried
Estimated Value of Petroleum
Production - 1958 p. 15 not carried
Productive and Non-Productive
Average Under Lease for Oil
and Gas p. 16 not carried
Extent and Economic Value of
Industry p. 17-18 p. 5-6
State Statistics p. 19-86 p. 7-64
The difference in the number of pages in the sections of the publications devoted to "State Statistics" is largely accounted for by the difference in the amount of space devoted to advertising.
The various subheadings under each state in the 1959 issue are: (1) Extent and Economic Value of Industry; (2) Production and Reserves; (3) Exploration and Development, while the subheadings used in 1958 were: (1) Extent and Economic Value of Industry; (2) Production; (3) Exploration and Development; (4) Reserves; (5) General. These headings demonstrate that the same material was covered in both issues, the principal difference being in the manner of presentation.
The Importance of Oil & Gas for Consumers in your State in 1957
p. 87-102 not carried (some information in
1958 not carried in
1959.)
(some of material in
1959 appears in
"general" in 1958)
1959 1958
Source of Data Inside back cover Inside back cover
In contrast to the foregoing data are the contents of the regular issues of "Monthly" which, as illustrated by Petitioner's Exhibits 1, 2 and G, are comprised of articles on varied subjects, certain regular departments, and a considerable amount of advertising matter.
The front cover of "Your State" (Pet. Exhibit F) is approximately 11 1/2 inches by 8 1/4 inches in size. There is a half inch gold border extending six inches across the top of the cover, on which the legend "The Independent Petroleum Association of America Monthly" appears in ten point, sans serif, extra bold, all caps type. 2/ Down the right-hand side is a 1-5/8 inch gold border with the names of most of the states printed thereon in the same size and style of type as that last mentioned. In the upper half of the front cover is a 6 by 4 inch gold box at the top of which is the seal of the Association, while in the main portion of this box, in 48-point, medium gothic, condensed type, are the words "The Oil Producing Industry in Your State." To the lower right of the box is a 2 by 3 1/2 inch map of the United States, with most of the states, presumably those that are oil-producing, shown in gold and the remainder of the states shown in white. Toward the bottom of the cover are the words "Special 1959 Edition", with the words "Special" and "Edition" being 36-point type, and the figures "1959" being in 72-point type. Below this legend, in 24-point type, are the words "Commemorating the 100th Anniversary of the Oil Producing Industry". The background of the front cover, except for the borders, is black.
Having in mind the physical characteristics of "Your State", these characteristics must be measured against the yardstick of the regulations. Section 132.4 of the Postal Manual sets forth descriptions of matter that may, and that may not, be mailed at second-class postage rates. Subsection 132.42(c) reads as follows:
"c. Special issues containing annual reports, directions, lists and similar text (may be mailed at second-class rates) but the copies may not be distinguished from the regular issues by bearing designations which indicate they are annuals, directories, catalogs, yearbooks, or other types of separate publications. The regular annual subscription price must include the copies of the special issues." 3/
Applying the plain language of this regulation to the front cover of "Your State", it is clear that this publication is an "annual" or "yearbook", and that it is so designated. Looking beyond the front cover, the contents of the publication demonstrate that it is designed and intended for use as an annual. Furthermore, in the statement in the masthead, the publisher refers to the publication as one of the "best annual reference books" on the oil producing industry. The testimony of the editor indicates that it is a "separate and distinct" publication from the monthly (Tr. 37) which is to be "presented annually from now on." (Tr. 30; Pet. Exhibit 1, p. 80, under heading "Data Covered.") All of these facts and circumstances are compelling evidence that "Your State" is an annual, which the mere printing of the name of "Monthly" in comparatively small type at the top of the front cover, and the printing of the second-class indicia at the bottom of the inside front cover will not overcome. I find as a fact that "Your State" is an annual or yearbook.
Section 132.2 of the Postal Manual sets forth the regulations as to the qualifications a publication must have in order to be eligible for second-class mail privileges. Subsections 132.25(a) and (b) provide that:
"Copies of publications must be identified as second-class mail by having the following items printed on one of the first five pages in a position where they may be easily located by postal employees and other interested persons:
"a. Name of Publication. The name of the publication must be shown on the front in a position and in a style and size of type that will make it clearly distinguishable from the name of the publisher or other items on the front.
"b. Date of issue."
Considering the front cover, alone, the words "The Oil Producing Industry in Your State" are given the position of most prominence. When these words are considered in conjunction with the legend across the top of the front cover, the impression that one receives is that the Independent Petroleum Association of America publishes a monthly publication, the name of which is "The Oil Producing Industry In Your State." If a person, be he a "postal employee" or "other interested person", did not otherwise know the facts, the probability is strongly on the side of his believing that "Your State", and not "Monthly" is the name of the publication. Such a conclusion would be entirely supportable simply by reason of the importance attached to "Your State" by its location, and size of type. (See also Tr. 39) I find as a fact that the name of the publication under consideration is not presented on the front cover as to make it clearly distinguishable. This finding is based on the material under consideration in this particular case, and is not to be considered as a reversal of the position stated in P.O.D. Docket No. 1/158, wherein different material was involved.
Concerning the "date of issue" question in this case, subsection 132.25(b) of the Postal Manual, quoted above in its entirety, is brief and, to my mind, uninformative because it is not explained. Looking at the other exhibits in the case, they bear only the month and year of issuance, together with a consecutive issue number. For example, Petitioner's Exhibit G is Vol. XXIX, No. 10, February 1959 (p. 9); Petitioner's Exhibit 1 is Vol. XXX, No. 2, June 1959 (p. 13); and Petitioner's Exhibit 2 is Vol. XXX, No. 4, July 1959 (p. 15); while "Your State", which is Petitioner's Exhibit F is Vol. XXX, No. 3, 1959.
Since insofar as sequence is concerned it is immaterial whether "Monthly" for July, 1959, was published before "Your State", 1959, or vice versa; since "July, 1959" is regarded as an adequate date of issue for Petitioner's Exhibit 2; and since the 1959 issue of "Your State" actually was published in July of 1959, I can see no reason why the words "July, 1959", appearing on the page numbered 3 of Petitioner's Exhibit F, are not an adequate showing of the date of issue. I find as a fact that "Your State" for 1959 bears an adequate date of issue.
CONCLUSIONS OF LAW
Based upon the entire record in this proceeding, I have arrived at the following conclusions of law:
1. The question of whether the actions by officials of the Tulsa, Oklahoma, Post Office in this case create an estoppel upon the Respondent, precluding the latter from reversing the former's ruling, and precluding the Respondent from directing the Postmaster at Tulsa to collect postage at the applicable rate for the mailing of "Your State", is within the administrative jurisdiction of the Hearing Examiner initially, and it is within the final administrative jurisdiction of the Judicial Officer.
2. The Respondent is not estopped from reversing the ruling of the Tulsa, Oklahoma postal officials, and he may, and should, instruct the Tulsa, Oklahoma, postal officials to collect postage at the applicable rates upon copies of "Your State" mailed at Tulsa.
3. "Your State" is separate and distinct from "Monthly", and it is an annual or yearbook. Since "Your State" is an annual or yearbook, it does not meet the requirements of Section 226 of Title 39, United States Code, and it does not conform to the requirements of Section 132.42c of the Postal Manual (39 C.F.R. 22.4(b)(3).
4. The manner of the presentation of the title of "Your State" is not in conformity with the requirements of Section 132.25(a) of the Postal Manual (39 C.F.R. 22.2(e)(1).
5. The date of issue as shown in "Your State" adequately complies with the provisions of Section 132.25(b) of the Postal Manual (39 C.F.R. 22.2(e)(2).
6. The application of the Independent Petroleum Association of America for re-entry into the mails as second-class matter of the publication "The Independent Petroleum Association of America Monthly" due to a change of frequency is denied.
7. The Respondent's rulings of August 25, 1959, and September 21, 1959, are sustained.
Proposed findings of fact and conclusions of law submitted by the parties have been fully considered and they are adopted to the extent herein indicated. Otherwise, such proposed findings of fact and conclusions of law are denied for reasons herein stated or because of their immateriality.
1/ Petitioner's Exhibit I was furnished by Counsel for the Petitioner after the date of the hearing.
2/ Sizes and styles of types given are approximate and are used to indicate relative prominence of display.