author: TAMM, Chief Judge.

text:
    CITY OF GROTON et al., Plaintiff-Petitioner-Appellants, v. FEDERAL POWER COMMISSION, Defendant-Respondent-Appellee, and The Connecticut Light and Power Company, Intervenor-Respondent.
    No. DC-13.
    Temporary Emergency Court of Appeals.
    Oct. 30, 1973.
    Grace Powers Monaco, Washington, D. C., Charles F. Wheatley, Washington, D. C., on the brief for appellants.
    Charles J. McClees, Atty., Washington, D. C., for F. P. C., Leo E. Forquer, Gen. Counsel, George W. McHenry, Jr., F.C.C., on the brief for appellee.
    James R. McCotter, Jerome Ackerman, Covington & Burling, Washington, D. C., James R. McIntosh, Paul F. McAlenney, Day, Berry & Howard, Hartford, Conn., on the brief for intervenor.
    Before TAMM, Chief Judge, and VAN OOSTERHOUT and HASTINGS, Judges.
   TAMM, Chief Judge.

The City of Groton et al. [hereinafter “Cities”] sought review in the United States District Court for the District of Columbia of Federal Power Commission [hereinafter “Power Commission”] Order No. 437A-12 of October 12, 1972. Cities brought their action pursuant to §§ 211(a), (d)(1), and (e)(1) of the Economic Stabilization Act of 1970, 12 U.S.C. § 1904 (Supp. II, 1972). Defendants below were the Price Commission [now Cost of Living Council] and the Power Commission. The motion of Connecticut Light & Power Co. [hereinafter “CL&P”] to intervene as of right was granted.

In the course of proceedings in the trial court, all parties moved for summary judgment with the Cost of Living Council additionally moving to dismiss as to the Council. Following oral argument, the trial court granted the Power Commission’s and CL&P’s motions for summary judgment, granted the Cost of Living Council’s motion to dismiss, and denied the Cities’ motion for summary judgment. Formal findings of fact and conclusions of law were filed on July 9, 1972, and this appeal followed. For the reasons stated below, we affirm.

I.

The chronology of this rather complex situation must be clearly understood and so is set out at length. Plaintiff-appellants City of Groton, Borough of Jewett City, Second and Third Taxing Districts of City of Norwalk, City of Norwich and Town of Wallingford are public agencies organized and existing under the laws of the State of Connecticut. The aforesaid appellants own and operate their own electric systems and purchase electricity at wholesale prices from CL&P. Appel-lee CL&P is a public electric utility company engaged principally in the generation, transmission and sale of electricity in the State of Connecticut. In this regard, CL&P is subject to the regulation of the Power Commission pursuant to subchapter II of the Federal Power Act, 16 U.S.C. § 824 et seq. (1970).

On January 1, 1963, CL&P and Cities entered into contracts for the sale and purchase of electricity. These contracts were filed with the Power Commission on July 29, 1964, as CL&P’s rate schedules pursuant to Section 205 of the Federal Power Act, 16 U.S.C. § 824d (1970). These rate schedules became effective pursuant to the provisions of the Federal Power Act and remained so at all times relevant to this case. Each of these contracts contained an identical fuel adjustment clause. Basically, this clause permitted CL&P to increase the rates charged its wholesale customers, including Cities, to reflect increases in the cost of fuels used to generate electricity.

On August 15, 1971, the President issued Executive Order No. 11615, 3 C.F. R. 199 (1972) exercising his authority under the Economic Stabilization Act of 1970, 12 U.S.C. § 1904 (Supp. II, 1972), to issue appropriate orders for the stabilization of prices, rents, wages and salaries. This executive order [Phase I] froze prices for 90 days at the highest level charged during the previous 30-day period. In compliance with this order and implementing regulations issued by the Power Commission, CL&P did not increase its rates to Cities pursuant to the fuel adjustment clause during the 90-day freeze from August 15, 1971 to November 14, 1971. Nothing done during this period is in issue in the instant case.

On October 15, 1971, the President issued Executive Order No. 11627, 3 C.F. R. 218 (1972), [Phase II] which created the Price Commission to exercise such control over prices and rents as the Cost of Living Council delegated to it. Pursuant to authority subsequently delegated to it, the Price Commission issued regulations to govern all changes in prices on or after November 14, • 1971. 36 Fed.Reg. 21953-55 (1971). Section 300.016 of said regulations specifically governed rate increases by regulated public utility companies. Section 300.-016(a) provided generally that public utilities such as CL&P, could increase their rates provided “such increase [had] been approved by a regulatory agency.” The utility was required to notify the Price Commission of the agency’s approval or authorization. Section 300.016(b) was a special rule, governing utility rate increases which “were approved” by a regulatory agency before November 14, 1971, but which were not permitted to take effect due to Phase I. It required the regulatory agency to review such increases to insure consistency with the Economic Stabilization Act before the increases could become operative. In the case of CL&P, the “regulatory agency” referred to in these Price Commission regulations is the Federal Power Commission.

In order to implement these Price Commission regulations, the Power Commission issued Order No. 437A, 18 C.F. R. § 2.90a on November 16, 1971. Order 437A did not deal specifically with rate increases under a fuel adjustment clause, but rather concerned itself with future general rate increases. On December 10, 1971, the Power Commission issued Order No. 437A-5 specifically establishing review procedures for existing fuel adjustment clauses. This order identified all public utility companies, including CL&P, having rate schedules on file with the Power Commission containing fuel adjustment clauses, the operation of which was suspended by Phase I and Order No. 437. This order required that each public utility review its fuel adjustment clauses and certify to the Power Commission that any increase in rates resulting from the operation of a fuel adjustment clause was in compliance with section 35.14 of the Commission’s Regulations. Utilities so certifying were directed to include supporting data in accordance with the various sub-parts of section 35.14. Further, ordering paragraph (B) of Order 437A-5 provided as follows:

(B) Each public utility, upon the filing of that certification, which meets the requirements of Section 35.-14 of the Commission’s Regulations under the Federal Power Act, will be so notified by the Commission’s Secretary and thereupon shall be deemed to have satisfied the purposes of paragraph (d) of Section 2.90a of the Commission’s General Policy and Interpretations, so as to permit the affected fuel clauses to be operative, but in no event earlier than 12:01 a.m., November 14, 1971.

J.A. at 4.

In response to Order 437A-5, CL&P certified in writing to the Power Commission that any increases in rates arising from operation of its fuel adjustment clauses would be in compliance with Section 35.14 of the Power Commission’s Regulations. This letter of December 23, 1971, also included supporting data by which it intended to be in compliance with the subparts of Section 35.14. CL&P informed the Power Commission that if notification was received from the Power Commission, it intended to make increases resulting from its fuel adjustment clauses operative as of 12:01 a.m., November 14, 1971, in accordance with Commission Order 437A-5.

On January 14, 1972, the Price Commission promulgated revised regulations covering public utilities to be effective January 17, 1972. 37 Fed.Reg. 652-54. Section 300.16(c) provided:

(c) Price increases to which reporting and certification requirements do not apply. The reporting and certification requirements of this section do not apply to any price increase resulting from the pass-through of specific allowable costs, including taxes (except income taxes) and fuel costs, but not including labor costs, if the increase is not objected to by the appropriate regulatory agency and is authorized by statute, regulation, or order of the appropriate regulatory agency, or. by an approved tariff provision.

37 Fed.Reg. 653.

The Price Commission, on September 16, 1972, again revised its public utility regulations. Section 300.308(e) of these regulations provided as follows:

Certain allowable costs. A public utility may place in effect, without regard to the reporting and certification requirements of this section, any price increase resulting from the pass-through of specific allowable costs, including taxes (except income taxes) and fuel costs, but not including labor costs, if the increase is authorized by statute, regulation, or order of the appropriate regulatory agency, or by an approved tariff provision (e. g., a fuel adjustment clause).

6 C.F.R. § 300.308(e) (1973).

During the period from December 23, 1971 to June 23, 1972, there occurred correspondence between the Secretary of the Power Commission and CL&P in connection with the substantiating data required by § 35.14 of the Regulations. Finally, it appears that the Power Commission was satisfied, and on October 12, 1972, the Power Commission issued Order No. 437A-12. In its order, the Power Commission ruled that CL&P’s fuel adjustment clause was in conformity with Section 35.14 of the regulations, and consistent with the Economic Stabilization Act. Order 437A-12 provided in relevant part:

In accordance with Section 2.90a(d) of our General Policy and Interpretations, as quoted above CL&P’s fuel adjustment clause shall become effective as of 12:01 a.m., November 14, 1971. In our opinion municipal customers in their briefs, have not set forth sufficient reasons to justify an effective date other than November 14, 1971. This date, however, may be subject to authorization by the Price Commission and we shall so provide.

Order No. 437A-12 then provided as follows:

The Commission Orders:
(A) In accordance with the above findings Connecticut Power and Light’s [sic] Fuel Clause in its FPC Rate Schedules is hereby certified as consistent with the purposes of the Economic Stabilization Act of 1970, as amended, as required by Order No. 437A pursuant to Section 300.16 of Chapter III, Title VI of the Code of Federal Regulations.
(B) Connecticut Power and Light [sic] company is authorized to implement the billing to its affected customers pursuant to its fuel adjustment clause as of November 14, 1971, subject to authorization by the Price Commission.

J.A. at 52.

CL&P wrote to the Price Commission on October 20, 1972, requesting a statement that under Section 300.308(e) of the Price Commission’s Regulations CL&P’s fuel adjustment clause could be made operational again as of 12:01 a. m., November 14, 1971, in accordance with Power Commission Order No. 437A-12 without specific approval by the Price Commission. The General Counsel for the Price Commission by letter of November 28, 1972, stated that CL&P’s fuel clause was subject to § 300.308(e) of the Price Commission’s Regulations. Since these regulations provided that rate adjustments pursuant to a fuel adjustment clause need not be submitted to the Price Commission for approval, the letter concluded that the clause could become operative as of November 14, 1971, according to the terms of Order No. 437A-12.

Cities applied for rehearing of Order 437A-12 urging that it constituted an illegal retroactive rate increase and further that it approved a defective fuel adjustment clause in contravention of Order, No. 437A-5. (J.A. 53-56.) The Power Commission denied the motion for rehearing. (J.A. 58-60.) In the order denying rehearing the • Power Commission noted that ratemaking had not been involved in Order No. 437A-12. The Power Commission contended that CL&P’s fuel clause was operative prior to the institution of Phase I and would have remained operative but for Executive Orders Nos. 11615 and 11627. The Power Commission further stated that in approving the clause it had not made new rates, but had satisfied itself that the clause was harmonious with the President’s stabilization program. (J.A. at 58.) The Power Commission reiterated its finding that the clause was not inconsistent with § 35.14.

On January 10, 1973, Cities filed suit in the United States District Court. It was there alleged that the Power Commission’s Order No. 437A-12 was not authorized under the Economic Stabilization Act or the Federal Power Act. Further, Cities alleged that the Price Commission’s order of November 28, 1972, was contrary to applicable regulations governing the period in question to the extent that it approved Order No. 437A-12.

The dispute thus concerns at what point in Phase II CL&P could begin to pass on to Cities, pursuant to the fuel adjustment clause, higher fuel costs which it experienced. CL&P asserts that it is entitled to be reimbursed for additional incremental fuel costs from November 14, 1971; the Power Commission agrees. Cities argue that the operation of the fuel adjustment clause should be negated from November 14, 1971 until October 12, 1972 when the Power Commission issued Order No. 437A-12. The additional fuel costs incurred by CL&P during the period amount to approximately $350,000.

II.

Despite the apparent complexity of this situation which encompasses numerous orders and regulations, we believe that the questions of statutory interpretation raised herein may be simply resolved. The liminal question is which Price Commission regulations should be examined to test the validity of Order No. 437A-12. CL&P and the Power Commission assert that under § 300.-16(c) and 300.308(e) of the Price Commission’s regulations, no action by the Power Commission or the Price Commission was required before the fuel adjustment clause could become operative. It is urged that the Power Commission, when it issued order 437A-5, created procedures for the review of fuel adjustment clauses which exceeded the requirements ultimately developed by the Price Commission. Such a finding was specifically rejected by the trial court.

Cities contend, on the other hand, that § 300.16(b) (November 13, 1971) is controlling in this action, notwithstanding subsequent promulgation of § 300.16(c) (January 17, 1972) and 300.308(e) (September 18, 1972). It is Cities’ argument that because the fuel adjustment review proceeding which culminated in Order 437A-12, here under review, began in response to Order No. 437A-5 in December, 1971, we must judge the Commission’s acts in light of the reasons that the Commission itself gave at the time of Order 437A-12. National Air Carrier Ass’n v. CAB, 141 U.S.App.D.C. 31, 436 F.2d 185, 195 (1970).

We find it unnecessary to decide this issue because it is clear that judged under either regulation, the pass-through of costs under CL&P’s fuel adjustment clause was valid as of the beginning of Phase II.

Assuming that CL&P and the Commission are correct, Section 300.16(c) superceded original sections 300.16(a) and (b). 37 Fed.Reg. 652-53 (January-14, 1972). Section 300.16(c) specified certain rate increases which did not require review for consistency with the Economic Stabilization Program because they operated to pass through only price increases which were necessarily cost justified and therefore in conformance with Phase II criteria. The Price Commission, in 300.16(c) and 300.308(e), provided that CL&P’s fuel adjustment clause, suspended by Phase I, could be made operational again at the beginning of Phase II with no review by the Power Commission, Therefore the Power Commission’s review of the clause, begun on the assumption that review was required by section 300.16(b), was unnecessary.

Alternatively, if we conclude that we must judge the validity of Order 437A-12 in light of Order 437A-5 and § 300.16(b) of the Price Commission’s regulations, we arrive at the heart of Cities’ argument. Cities contend that because of the adjustment in loss factor agreed to by CL&P in correspondence with the Secretary, the Commission could not legally find that CL&P had properly certified its existing fuel adjustment clause as required by Order No. 437A-5. Thus, it is argued, by finding that Order 437A-5 was met, the Commission acted unlawfully in issuing Order 437A-12. The controversy centers over what legal effect should be accorded to the letters between the Secretary and CL&P. Accordingly, we must examine these letters in some detail.

The fuel adjustment clause in the Cities-CL&P contract provided only that fuel adjustment charges would be “adjusted for delivery losses.” CL&P had at all times prior to Phase II employed a systemwide loss factor to the fuel adjustments of both Cities and its lower voltage customers. CL&P apparently felt that individual loss factors, reflecting different delivery voltages, could not readily be calculated. (J.A. at 43.) The Secretary of the Power Commission wrote to CL&P on February 22, 1972, stating that compliance with Order No. 437A-5 would “require supporting data which should include, inter alia, . the loss factor adjustment to reflect delivered energy . . . .” (J.A. at 10.) CL&P responded on March 14, 1972 pointing out that “delivery efficiency” ranged from .90413 to .91320 in 1969 and 1971 respectively. (J.A. at 11-12.) The Secretary then asked CL&P to explain “the usé of the [systemwide] loss factor in light of the fact that the bulk of retail customers are served at lower voltages.” (J.A. at 14.) On June 2, 1972 CL&P replied that it could not readily calculate losses at discrete voltage levels, and that it felt estimation would “reduce the overall accuracy of the calculations.” (J.A. at 15.) On June 23, 1972, CL&P indicated to the Secretary that it could then estimate losses to bulk transmission customers, such as Cities. CL&P proposed a loss figure of 3.5% giving a delivery efficiency of .965. CL&P further stated

If it will resolve the matter, we would be willing to apply this efficiency factor of .965 in the fuel adjustment computations from November, 1971 for all of the wholesale for retail customers.

J.A. at 16.

Cities concludes from this correspondence that the fuel adjustment clause which the Power Commission approved was not initially in compliance with Section 35.14 of the regulations, and therefore could not, under Order 437A-5 be approved. Our examination of the correspondence persuades us that these letters were merely a request for additional data to facilitate a determination by the Power Commission that the fuel adjustment clause was consistent with § 35.14. Cities have not attempted to convince this court (nor could they) that the Secretary, acting alone, could in any manner rule on the validity of the clause. These letters are not an action of the Power Commission, nor a determination that the clause was not in compliance. Indeed, the Power Commission stated clearly in Order 437A-12 that CL&P’s fuel clause was “in conformity with Section 35.14 . . . .” (J.A. at 51.)

Our decision is further supported by a statement of the Power Commission, in denying rehearing, which clearly negates Cities’ contention. The Commission stated:

CMG is in error in insisting on the fact that the fuel adjustment clause in effect on August 14, 1971 was not in conformity with Section 35.14 of the Rules and Regulations. Again this results from confusing the certification process set out in Order No. 437A-5 with the issues that may arise in a general rate case. Contrary to CMG’s assertions we have not found that CL&P’s fuel clause, as it existed on August 14, 1971 is inconsistent with Section 35.14 of our Regulations.

J.A. at 59.

This court has stated in City of New York v. New York Telephone Co.:

Moreover agency expertise is particularly useful here since appellants seek an interpretation of a procedural rule adopted by the Commission itself. It is well established that agency input is extremely helpful in interpretation of its own regulations. [Footnote omitted.]

468 F.2d 1401, 1403 (Em.App., 1972). See also Udall v. Tallman, 380 U.S. 1, 16-17, 85 S.Ct. 792, 13 L.Ed.2d 616 (1965); University of Southern California v. CLC, 472 F.2d 1065, 1068 (Em. App., 1972), cert, denied, 410 U.S. 928, 93 S.Ct. 1364, 35 L.Ed.2d 590 (1973); United States v. International Brotherhood of Electrical Workers, 475 F.2d 1204 (Em.App., 1973).

Thus, we believe that the Power Commission was correct in finding, assuming that a finding was necessary, that CL&P’s fuel clause was not changed and was at all times in conformance with Section 35.14 of the Power Commission’s Regulations. We agree with the trial court’s finding that the Power Commission was correct in concluding, in Order 437A-12, that CL&P’s clause was consistent with the Economic Stabilization Act.

To reiterate, we have analysed both alternatives, and hold that under either, the fuel adjustment clause became operational on November 14,1971.

m.

Finally, Cities argue that in approving the operation of the fuel adjustment clause, the Commission engaged in retroactive ratemaking. The trial court made no specific finding on this question. We do not reach this issue because we cannot. It is our view that an allegation of retroactive ratemaking raises issues under the Federal Power Act. See, e. g., Montana-Dakota Utilities Co. v. Northwestern Public Service Co., 341 U.S. 246, 254, 71 S.Ct. 692, 95 L.Ed. 912 (1951); FPC v. Sunray DX Oil Co., 391 U.S. 9, 24, 88 S.Ct. 1526, 20 L.Ed.2d 388 (1968). This court is not the proper forum to hear such issues. The law is clear that Power Commission orders which raise Economic Stabilization issues are exclusively reviewable in the District Court, with.review in this court. Orders raising Federal Power Act issues are exclusively reviewable in the Court of Appeals.

In Municipal Intervenors Group v. FPC, 153 U.S.App.D.C. 373, 473 F.2d 84 (1972) on very similar facts, the Court of Appeals dismissed petitions for review of Power Commission orders on the ground that the petitions raised only Economic Stabilization Act issues. There, the Power Commission had suspended certain gas rates which would have been effective but for Phase I. After the 90-day period the Commission entered orders permitting those rate increases to be effective as of November 14, 1971. The Court of Appeals held that Power Commission Order No. 437 was founded entirely upon the Economic Stabilization Act, Executive Order No. 11627 and Section 300.016 of the Price Commission’s Regulations. 473 F.2d at 88. tThe Court of Appeals noted that “the circumstance that utilities are subject to two types of regulatory control raises the possibility of two types of judicial review.” 473 F.2d at 90.

Subsequently, in Municipal Electric Utility Assoc. of Alabama v. FPC, 485 F.2d 967 (D.C.Cir. Nos. 72-1293, et al., decided June 29, 1973) the Court held that Economic Stabilization Act issues in a proceeding arising under the Federal Power Act were exclusively reviewable in the District Court, with appeal to this court. At 970-971. Clearly reaffirming Municipal Intervenors, the court stated:

In Municipal Intervenors Group we stated: “The circumstances that utilities are subject to two types of regulatory control raises the possibility of two types of judicial review” [footnote omitted]. While both aspects of the Commission’s regulatory jurisdiction are reflected in the order sought to be reviewed, the issues on appeal arising under the Federal Power Act may be cleanly severed from those that require consideration of the Economic Stabilization Act [footnote omitted]. We believe that an entirely harmonious accommodation of the two pertinent Congressional enactments can be achieved by dual review of the Commission’s order in both this court and the District Court, each tribunal acting within the sphere of its statutorily defined exclusive jurisdiction.

At 970-971. (Emphasis added.)

Under this statutory system of separate review for separate issues, Cities’ allegation of retroactive ratemaking, raising Federal Power Act issues, cannot be heard in this court. Municipal Intervenors Group v. FPC, supra; Municipal Electric Utility Association of Alabama v. FPC, supra.

It was noted supra that Cities have already applied for review of Order No. 437A-12 to the Court of Appeals for the District of Columbia Circuit. This petition, alleging Federal Power Act issues, was dismissed. Connecticut Municipal Group v. FPC, (D.C.Cir. No. 72-7208, Order entered July 23, 1973). This brief order dismisses the petition for “lack of jurisdiction.” For purposes of this appeal we need say only that this court has jurisdiction over only Economic Stabilization Act issues. We have exercised this jurisdiction, and find that the trial court was correct in its conclusion that the Power Commission, acting under authority delegated pursuant to the Economic Stabilization Act, violated no pertinent regulations when it issued Order No. 437A-12.

IV.

For the reasons stated above, the opinion of the trial court is

Affirmed.

      . The Cost of Living Council was created as successor to the Price Commission by Phase III regulations. 38 Fed.Reg. 6099 (March 6, 1973).

      . CL & P’s counterclaim for certain monies claimed owing to CL & P by Cities is still pending before the District Court.

      . Pursuant to §. 211(b)(2) of the Economic Stabilization Act Amendments of 1971, 12 U.S.C. § 1904 (Supp. II 1972).
      Cities moved, pursuant to Rule 42(b) Fed. R.App.Proc. for voluntary dismissal of their appeal in so far as it pertained to the Cost of Living Council. This court granted said motion August 28, 1973.

      . CL & P filed new tariff provisions with the Power Commission on June 16, 1972.
      These new provisions became effective January 16, 1973. Thus, the previously filed rate schedules were fully effective during the period in question here — November 14, 1971 to October 12, 1972.

      . Fuel Cost Adjustment Applicable To All Energy Charges

      The Energy Charge specified above is based upon an average fuel price of 37 cents per million Btu for fuel delivered alongside the Power Company’s generating stations. If the average cost of such fuel is above or below 37 cents per million Btu, an adjustment shall be made in the Energy Charge for each one-tenth of a cent above or below 37 cents per million Btu.
      The amount of such adjustment shall be determined by multiplying the variation in the price per million Btu of fuel burned during the month above or below 37 cents by the average amount of fuel burned per kilowatt-hour during the past 12 months, adjusted to give effect to hydro generated energy and corrected for delivery losses.

      . The primary purpose of the fuel adjustment clauses allowed by the Power Commission is to keep current both the base price of fuel and the operating efficiencies. Such a clause permits a utility to pass on to its customers current increases or decreases in fuel costs without the necessity of making rate filings ordinarily required to effect rate changes. See Amending Regulations to Govern the Filing of Rate Schedules by Public Utilities and Licensees, Docket No. R-227 (Notice of Proposed Rule-making), 28 Fed.Reg. 129 (1963).

      . Order No. 437, 18 C.F.R. § 2.90 (1973), issued August 18, 1971, provided that increases in rates to become effective after August 14, 1971, as a result of “automatic or other escalations” would not take effect for the 90 day period established by Executive Order No. 11615.

      . Cost of Living Council Order No. 4, 6 C.F.R. 432 (1971).

      . On November 17, 1971, the Price Commission amended § 300.016(a) to reserve to itself “the right to review and limit the amount of any sucli requested increase, ordered increase, or other authorized increase.” 36 Fed.Reg. 22014 (1971).

      . § 300.016 Regulated Public Utilities
      (b) Special rule. In the ease of x-ate increases which were approved by a regulatory agency or other appropriate legal authority before November 14, 1971, but which were not permitted to take effect due to Executive Ord.er 11615, such rate increase may take effect with respect to transactions occurring after November 13, 1971. However, before such increases may take effect, such regulatory agency or other appropriate legal authority shall review such increases with regard to their consistency with the purposes of the Economic Stabilization Act of 1970, as amended, and certify that any such increases or adjusted increases are consistent with such purposes. Such certification, together with a report of the increased rate schedule thus put into effect, showing the amount of such increased rates, shall immediately be supplied to the Commission by any regulated person which receives such certification and which had gross receipts of $50 million or more during its most recent fiscal year.
      36 Fed.Reg. at 21953-54.
      Note that Sections 300.016(a) and (b) were renumbered, without substantive change, to 300.16(a) and 300.16(b). 36 Fed.Reg. 23977 (1971). They will be referred to by their renumbered designations for the balance of this opinion.

      . J.A. at 1-8.

      . Section 35.14 sets standards for acceptable fuel adjustment clauses.

      . J.A. at 9.

      . CL & P likewise informed Cities by a statement which accompanied invoices from CL & P to Cities in January 1972 and following months. Appellee’s Brief, Appendix B.

      . A detailed description of the contents of these letters appears infra at 933-934.

      . J.A. at 50-52. ,

      . J.A. at 120-21.

      . We note that in a related ease, Cities appealed Order No. 437A-12 under § 313(b) of the Federal Power Act, 16 U.S.C. § 825J (1970) in an action entitled Connecticut Municipal Group v. FPC, No. 72-2208 (D. C. Cir. December 18, 1972). Cities therein alleged that the FPC had violated its regulations under the Economic Stabilization Act and had exceeded its authority under the Federal Power Act. The appeal was dismissed for lack of jurisdiction by court order of July 23, 1973 (J.A. at 78).

      . Brief of Appellee-Intervenor at 10; Brief of Appellee at 17-18.

      . Apparently, Order 437A-5 is still in effect. We do not by this discussion, express any opinion as to its current validity nor whether it is indeed excessive in light of later Price Commission regulations, e., g., 300.308(e). {

      . Section 300.16(c) was carried over into Section 300.308(e) of the recodifieation of public utility regulations.

      . The fact that Section 300.16(c) was promulgated on January 14, 1972, several months after the beginning of Phase II, is of no import. The clear language of the regulation compels the understanding that increases covered by it would be allowed from the beginning of Phase II. By any other interpretation (i. e. that pass through only be allowed from the date of promulgation of the new regulation), the Price Commission’s determination that such increases were per se consistent with Phase II would be frustrated for the period from November 14, 1971 to January 13, 1972.

      . In order for CL & P’s fuel clause to satisfy § 300.16(e) it must have been (a) “not objected to by the [Power Commission]” and (b) “authorized by statute, regulation, or order of the [Power Commission] or by an approved tariff provision.” Both requirements were clearly met. The correspondence between the Secretary and CL & P did not constitute an “objection” to the clause. See discussion at 933-934 infra. CL & P’s fuel clause was certainly authorized by “an approved tariff provision.” The clause was filed with the Power Commission on July 29, 1964, as part of CL & P’s rate schedule and became effective in accordance with § 205 of the Federal Power Act. Furthermore, fuel adjustment clauses were cited specifically as examples of “allowable costs” in § 300.308(e), recodifying § 300.16 (e).

      . Simply stated, when electricity is transmitted to the buyer through power lines, some loss occurs. Since a fuel adjustment clause is designed to pass on to the consumer higher costs of fuel generation, the charges passed through must be adjusted to reflect the fact that less electricity is delivered than generated. This is the “loss factor.”

      . Cities do not claim that Order No. 437A-5 is in violation of, or inconsistent with, the Economic Stabilization Act.

      . Since CL & P was able to meet the certification procedures of Order No. 437A-5, it was not required to file a new rate schedule pursuant to ordering paragraph (c) thereof.

      . City of Groton v. FPC, Civil Action No. 56-73, 10 (D.D.C. July 9, 1973). J.A. at 76.

      . Also issues arising under the Natural Gas' Act which the Commission administers.

      . See § 313 of the Federal Power Act, 16 U.S.O. 8251 (1970) and § 211 of the Economic Stabilization Act of 1970, as amended, 12 U.S.O. § 1904 (Supp. II, 1972).


source: Caselaw Access Project

author: VAN OOSTERHOUT, Judge.

license: Public Domain

text:
    UNITED STATES of America, Plaintiff-Appellant, v. The STATE OF OHIO et al., Defendants-Appellees.
    No. 6-2.
    Temporary Emergency Court of Appeals.
    Oct. 25, 1973.

      Paul T. Michael, Washington, D. C. (Irving Jaffe, Acting Asst. Atty. Gen., William E. Nelson, Stanley D. Rose, William C. White, Dept. of Justice, Washington, D. C., on the brief), for appellant.
    Robert B. Meany, Asst. Atty. Gen. (William J. Brown, Atty. Gen. on the brief), for appellee, State of Ohio.
    John A. Brown, Lucas, Prendergast, Albright, Gibson, Brown & Newman, Columbus, Ohio, for appellee, Successful Relators, Ernest Fry and Thelma Boehm in Supreme Court of Ohio.
    Jerry L. Riseling, Columbus, Ohio, for appellee, Jesse T. Kaiser.
    Stephen S. Boynton, McIntosh & Boynton, Washington, D. C., for amicus curiae, Governmental Employees.
    Leonard S. Sigall, Reynoldsburg, Ohio, for Successful Relators, James C. Ervin, and others in the Tenth District Court of Appeals.
    Before TAMM, Chief Judge, and VAN OOSTERHOUT and HASTINGS, Judges.
   VAN OOSTERHOUT, Judge.

This case has been certified to this court for appropriate proceedings in accordance with § 211(c) of the Economic Stabilization Act as amended hereinafter called the Act, by the United States District Court for the Southern District of Ohio. The certification was filed in this court on July 3,1973.

The issue certified is whether the Act “authorizes the Pay Board and other administrative machinery created by said Act and the executive orders and regulations thereunder, to control the salaries of employees of the State of Ohio in a manner which is in derogation of Senate Bill 147, Section 143.10(A), Ohio Revised Code. [Hereinafter called Pay Bill].”

This action was commenced in the United States District Court by the Government pursuant to §§ 209 and 211 of the Act. The Government seeks a permanent injunction to prevent the State of Ohio from violating the Act and Executive Order 11695 by paying wages and salaries provided by the Ohio Pay Bill to State employees in excess of the amount permitted by the Pay Board Order of March 10, 1973. The certification is based upon the trial court’s determination that a substantial constitutional issue is presented.

Section 211(c) provides:

In any action commenced under this title in any district court of the United States in which the court determines that a substantial constitutional issue exists, the court shall certify such issue to the Temporary Emergency Court of Appeals. Upon such certification, the Temporary Emergency Court of Appeals shall determine the appropriate manner of disposition which may include a determination that the entire action be sent to it for consideration or it may, on the issues certified, give binding instructions and remand the action to the certifying court for further disposition.

The determination of whether appropriate action by this court should be limited to consideration of the constitutional issue certified or whether all issues presented by the litigation should be resolved by this court must be made upon a case-to-case basis. Consideration must be given to the fact that this court is not well equipped to conduct an extensive evidentiary hearing in event such hearing is required, and the fact that the time of three judges living in scattered parts of the country would be consumed in conducting such hearing.

In our present case, all of the record before the trial court is before us. In addition all parties except James C. Er-vin, et al., relators in State ex rel. Ervin v. Gilligan, et al., in the Court of Appeals for Franklin County, Ohio, have entered into and filed with us an agreed statement of facts. Ervin, et al., state in their brief that they agree with the statement of facts set forth in the briefs of the other appellees. Thus it appears that all matters of fact are before us and that no dispute exists as to the basic material facts. Under such circumstances, it is appropriate for us under § 211(e) to hear and dispose of all issues presented by this litigation.

This court has granted plaintiff’s motion for an injunction pending final disposition of this case.

The issues here presented may be summarized as follows:

1. Did Congress intend to include the regulation of wages and salaries of State and local government employees within the coverage of the Act.
2. Does Congress under the Commerce Clause of the Constitution have power to regulate State and local government salaries in light of State sovereignty and the Tenth Amendment.
3. Did Congress have a rational basis for regulating the salaries of State employees.

For the reasons hereinafter set forth, we answer all of such questions in the affirmative and grant the Government the injunctive relief it seeks.

The appellees Ervin, et al., alone raise the issue that the judgment of the Franklin County, Ohio, Court of Appeals in State of Ohio ex rel. Ervin v. Gilligan, 35 Ohio App.2d 84, 300 N.E.2d 225 (1973), holds that Congress did not intend the Act to be applicable to the State employees, barring the Government from pursuing this action under the doctrine of res judicata. We reject such contention for the reasons hereinafter stated.

BACKGROUND FACTS.

The Pay Bill Act passed by the Ohio General Assembly became effective on January 20, 1972, upon being signed by the Governor. The bill provides for wage and salary increases for State employees by way of salary adjustments, reclassifications, and step increases amounting to an average increase of 10.-6% for all employees affected by the bill. Approximately 65,000 employees of the State, the State University and the County Welfare Departments were granted the increase here involved, effective for the pay period beginning with the one that included January 1, 1972.

On February 10, 1972, the case of State of Ohio ex rel. Ervin v. Gilligan was filed in the Franklin County Court of Appeals seeking a writ of mandamus requiring Ohio officials to pay the salary increases provided for in the Pay Bill. Such relief was granted by a decision handed down on May 29, 1973, reported at 35 Ohio App.2d 84, 300 N.E.2d 225.

The State of Ohio filed an application with the Pay Board for permission to pay salary increases provided in the Pay Bill. An evidentiary hearing was afforded. The Pay Board by decision and order of March 10, 1972, denied the State’s application for exception to the extent the requested increase was in excess of 7% for the current year. The State filed a petition for reconsideration which was denied. Additional requests for authority to pay the remaining amount of the salary increases provided by the Pay Bill and for reconsideration were denied.

On June 20, 1973, the Supreme Court of Ohio in the consolidated cases of Fry v. Ferguson, State ex rel. Boehm v. Le-gatt, and State ex rel. Kaiser v. Ferguson, 34 Ohio St.2d 252, 298 N.E.2d 129, determined that the state officials must pay the entire salary increases provided by the Pay Bill. The Government was not a party to that action. The decision is based on the court’s determination that Congress had not authorized the regulation of State salaries and wages.

It is agreed that the salary increases involved in this litigation are those for work performed between the pay period that included January 1, 1972, and March 1972, and that pursuant to Pay Board Order of March 10, 1972, State employees had been receiving the total salary increases provided by the Pay Bill since March of 1972. Approximately $10.5 million is involved in the salary increases here involved and funds have been appropriated and encumbered pending payment. In addition, approximately five million dollars in wage and salary increases which have not been paid to State University and County Welfare Department employees is involved.

STATUTORY CONSTRUCTION ISSUE.

The State urges that Congress did .not by the Economic Stabilization Act intend to authorize control over State wage and salary practices. Reliance is placed on the decision of the Ohio Supreme Court in State v. Ferguson, supra. In that case, the Ohio court held that a federal administrative body lacks jurisdiction to prevent enforcement of a State statute establishing the rate of compensation of State employees in the absence of a specific statutory grant of such power. The State relies on Parker v. Brown, 317 U. S. 341, 63 S.Ct. 307, 87 L.Ed. 315 (1943), and California v. Zook, 336 U.S. 725, 733, 69 S.Ct. 841, 93 L.Ed. 1005 (1949), to support its contention. Reliance on such eases is misplaced. They did not go to the extent of holding that preemption of a field constitútionally authorized can be accomplished only by an express statement that the law applies to states. It is quite true, as stated in the cases relied upon, that preemption is not to be lightly inferred. Moreover, California v. Zook makes mention of lack of supporting legislative history.

The contention here urged by Ohio was rejected in Case v. Bowles, 327 U.S. 92, 99, 66 S.Ct. 438, 442, 90 L.Ed. 552 (1946), the Court holding:

The argument that the Act should not be construed so as to include a state within the enumerated list made subject to price regulation, rests largely on the premise-that Congress does not ordinarily attempt to regulate state activities and that we should not infer such an intention in the absence of plain and unequivocal language. Petitioner presses this contention so far as to urge us to accept as a general principle that unless Congress actually uses the word “state”, courts should not construe regulatory enactments as applicable to the states. This Court has previously rejected similar arguments, and we cannot accept such an argument now.

In United States v. California, 297 U. S. 175, 186, 56 S.Ct 421, 425, 80 L.Ed. 567 (1936), the Court holds:

Respondent invokes the canon of construction that a sovereign is presumptively not intended to be bound by its own statute unless named in it, see Guarantee Title & Trust Co. v. Title Guaranty Co., 224 U.S. 152, [32 S. Ct. 457, 56 L.Ed. 706]; United States v. Herron, 20 Wall. 251, [22 L.Ed. 275]; In re Fowble, 213 F. 676. This rule has its historical basis in the English doctrine that the Crown is unaffected by acts of Parliament not specifically directed against it. United States v. Herron, supra, [20 Wall, at 255]; Dollar Savings Bank v. United States, 19 Wall. 227, 239, [22 L.Ed. 80.] The presumption is an aid to consistent construction of statutes of the enacting sovereign when their purpose is in doubt, but it does not require that the aim of a statute fairly to be inferred be disregarded because not explicitly stated. . . .

In Northern States Power Co. v. Minnesota, 447 F.2d 1143, 1147-48 (8th Cir. 1971), aff’d per curiam, 405 U.S. 1035, 92 S.Ct. 1307, 31 L.Ed.2d 576 (1972), the Eighth Circuit held that the federal government had preempted the field of regulating leaks of radioactive effluents of nuclear power plants. No express statement of preemption was contained in the legislation. The court held that federal preemption could be implied and listed the key factors bearing on the intention of Congress to preempt as follows:

. even where Congress has not expressly prohibited dual regulation nor unequivocally declared its exclusionary exercise of authority over a particular subject matter, federal pre-emption may be implied. . Key factors in the determination of whether Congress has, by implication, preempted a particular area so as to preclude state attempts at dual regulation include, inter alia: (1) the aim and intent of Congress as revealed by the statute itself and its legislative history. . . . (2) the pervasiveness of the federal regulatory scheme as authorized and directed, by the legislation and as carried into effect by the federal administrative agency (3) the nature of the subject matter regulated and whether it is one which demands “exclusive federal regulation in order to achieve uniformity vital to national interests.”.
(4) “whether under the circumstances of [a] particular case [state] law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.” (Citations omitted) Id. at 1146-1147.

It is quite true that the Economic Stabilization Act does not in express language state that it applies to the States. On the other hand, there is nothing in the statute which indicates that its provisions shall not apply to the States. The extensive legislative history of the Act unequivocally reveals that Congress intended the Act and its salary and wage provisions to apply to State and local governments. The most significant evidence of such intent is that Senator Proxmire on the floor of the Senate offered an amendment to exempt the salaries of State and local government employees from the operation of the Act. Such amendment was debated and defeated by a vote of 56 to 35.

The discussion of the bill in the Senate and House committees considering the bill reflects that the committees considered it necessary to cover State employees’ salaries by the Act and that it was their clear intention to do so.

The stabilization agencies have uniformly interpreted the Act to include States within its scope. The interpretation of statutes by the administrative agency responsible for their implementation is entitled to great weight. University of Southern California v. Cost of Living Council, 472 F.2d 1065, 1068 (Em.App.1972). It is clear from the Act and its legislative history that Congress intended the Act to apply to wages and salaries paid State and local government officials and employees. Compliance with both the State law increasing salaries and wages and the Stabilization Act is impossible. Thus, if the government has constitutional power to regulate the areas here involved, the federal Act controls under the doctrine of preemption.

CONSTITUTIONAL ISSUES.

The power of Congress to impose economic controls over compensation paid State and local government employees is based upon the Commerce Clause. In Murphy v. O’Brien, 485 F.2d 671 (Em.App.1973), this court was confronted with the contention that State sovereignty and the rights reserved to the States by the Tenth Amendment precludes Congress in the exercise of its power under the Commerce Clause from authorizing under the Economic Stabilization Act the power to regulate charges for services made by the State of Rhode Island. In that ease, the State statute imposed vehicle parking charges on State owned beaches where no such charge had been made prior to the price freeze period. We there held:

Otherwise valid federal legislation, e. g., the Economic Stabilization Act, which incidentally interferes with state affairs has in recent times been uniformly upheld by the Supreme Court. Maryland v. Wirtz, 392 U.S. 183, [88 S.Ct. 2017, 20 L.Ed.2d 1020] (1968); Case v. Bowles, 327 U.S. 92, [66 S.Ct. 438, 90 L.Ed. 552] (1946); New York v. United States, 326 U.S. 572, [66 S.Ct. 310, 90 L.Ed. 326] (1946); United States v. California, 297 U.S. 175, [56 S.Ct. 421, 80 L.Ed. 567] (1936) . . . . Id. at 674.

Judge Hastings, speaking for this court, clearly sets out the reasoning and the authority upon which our decision is based. What is said in that case equally applies to our present case.

Whatever doubt may have existed with respect to the power of Congress under the Commerce Clause to regulate State activities under appropriate circumstances is resolved by Maryland v. Wirtz, 392 U.S. 183, 88 S.Ct. 2017, 20 L.Ed.2d 1020 (1968). In that case, the Fair Labor Standards Act as amended was applied to the States and the States were required to conform to the minimum wage standards and overtime provisions of the Act with respect to employees of the hospitals and schools operated by the State. The Court, after determining the operations of the hospitals and the schools affect commerce, holds:

But while the commerce power has limits, valid general regulations of commerce do not cease to be regulations of commerce because a State is involved. If a State is engaging in economic activities that are validly regulated by the Federal Government when engaged in by private persons, the State too may be forced to conform its activities to federal regulation. This was settled by the unanimous decision in United States v. California, 297 U.S. 175, 56 S.Ct. 421, 80 L.Ed. 567. ... 392 U.S. at 196-197, 88 S.Ct. at 2024.

The Court quotes from United States v. California the following:

“[W]e look to the activities in which the states have traditionally engaged as marking the boundary of the restriction upon the federal taxing power. But there is no such limitation upon the plenary power to regulate commerce. The state can no more deny the power if its exercise has been authorized by Congress than can an individual.” 297 U.S. at 183-185, 56 S.Ct. at 424 (citations omitted). Id. at 198, 88 S.Ct. at 2025.

and then goes on to hold:

The principle of United States v. California is controlling here. Appellants’ argument that the statute involved there was somewhat more directly and obviously a regulation of “commerce,” and that the state activity involved there was less central to state sovereignty, misses the mark. This Court has examined and will continue to examine federal statutes to determine whether there is a rational basis for regarding them as regulations of commerce among the States. But it will not carve up the commerce power to protect enterprises indistinguishable in their effect on commerce from private businesses, simply because those enterprises happen to be run by the State for the benefit of their citizens. Id.

The State argues that if employees’ salaries and wages can be controlled, then all State activities can be controlled. A similar contention was answered and rejected in Maryland v. Wirtz as follows:

The Act establishes .only a minimum wage and a maximum limit of hours unless overtime wages are paid, and does not otherwise affect the way in which school and hospital duties are performed. Thus appellants’ characterization of the question in this case as whether Congress may, under the guise of the commerce power, tell the States how to perform medical and educational functions is not factually accurate. . . . 392 U.S. at 193, 88 S.Ct. at 2022.

The Government concedes in its brief that the Commerce Clause does not give Congress the power to regulate all State activities but that such power exists when Congress has a rational basis to conclude that the regulated State activities substantially affect commerce. As stated in New York v. United States, 326 U.S. 572, 583, 66 S.Ct. 310, 314, 90 L.Ed.2d 326 (1946):

The process of Constitutional adjudication does not thrive on conjuring up horrible possibilities that never happen in the real world and devising doctrines sufficiently comprehensive in detail to cover the remotest contingency. Nor need we go beyond what is required for a reasoned disposition of the kind of controversy now beforé the Court. .

The impact of the extension of the Fair Labor Standards Act to the States appears to be greater than the impact of the Act under consideration. The wage increases involved in Wirtz remain in effect indefinitely and until the law is repealed or appropriately amended. Compliance requires the State to raise additional money to make the payments. In our present ease, the wage increases are temporary. The State is placed in the same position as private employers with whom the State competes for qualified employees. State expenditures are decreased rather than increased and thus no additional revenue need be raised.

Provision is made in § 207 of the Act and the regulations promulgated under the Act for exceptions or exemptions in case of hardship. Such administrative consideration has been afforded the State in the present situation and partial relief has been afforded to the extent of authorizing a 7% wage increase. The Act at § 202 makes the finding that it is necessary in order to stabilize the economy, reduce inflation and to protect the purchasing power of the dollar to stabilize prices, rents, wages, salaries, dividends and interest. Similar findings are made in the Presidential proclamation implementing the Act.

We find here, as we did in Murphy v. O’Brien, supra, that a rational basis exists for imposing temporary economic controls on salaries paid by State and local governments. The State has not shown that the wage controls imposed unreasonable interference with the ability of the State of Ohio to function as a sovereign state, or that the Act and the regulations are invidiously discriminatory.

RES JUDICATA ISSUE.

As heretofore noted, the res judicata issue is raised only by the appellees Er-vin, et al., who were the successful parties in the Ohio Court of Appeals for Franklin County. The res judicata defense is based upon the Government being a party to the Ohio Court of Appeals ease by reason of the Court having permitted the Government to intervene. The Court’s reported opinion reflects that the case was continued pending resort to administrative proceedings and that at a conference between the parties and the Court on April 6, 1973, the Court asked the parties to brief certain issues, including the following:

1. Does the Tenth Amendment preclude the Government from regulating the salaries of officers and employees of State government.

2. Is there any improper delegation of authority in Executive Order No. 11695.

The Government on April 19, 1973, filed a petition for removal to the federal court and by reason thereof took no steps to brief the issues requested by the State Court. Twenty-eight U.S.C. § 1446(e) provides that after removal “the state court shall proceed no further unless and until the case is remanded.” Such language is clear and unambiguous. The federal court remanded the case on June 13, 1973, on the ground that the removal was not timely, noting however that the state court’s judgment rendered May 29, 1973, prior to removal, was improper under § 1446(e). The Government was afforded no opportunity to present its position to the State Court of Appeals.

Moreover, § 211 of the Act manifests a clear intent to give federal courts exclusive jurisdiction over the constitutionality of the Act and the validity of any action taken by any agency under the Act. The national scope of the Act, its underlying policy and the doctrine of federal preemption, should negate giving any res judicata effect to the State court judgment insofar as it relates to federal government and its authorized agencies. See Kalb v. Feuerstein, 308 U.S. 433, 438-439, 60 S.Ct. 343, 84 L.Ed. 370 (1940); Restatement of Judgments § 71 (1942). We reject the res judicata defense.

SUMMARY.

We hold that the Act, supported by its legislative history, clearly shows that Congress intended the Act to apply to states; that Congress under the Commerce Clause acted constitutionally in regulating the State salaries and wages; that the application of wage and salary restrictions to the states was reasonable and necessary to accomplish the objectives of the Act; that State sovereignty was not unduly nop unnecessarily interfered with; that the res judicata defense raised by Ervin, et al., is without merit. The Government is entitled to the injunction for which it prays.

It is ordered that an injunction issue restraining the State of Ohio and its officers from paying salary and wage increases provided for in the Pay Bill to the extent that they exceed the amount authorized by the Pay Board.

      . P.L. 91-379, August 15, 1970, as amended by P.L. 93-28, April 30, 1973, and P.L. 92-210, December 22, 1971.

      . The Pay Board in its March 10, 1972, order at paragraph 7 states: “The payment of the wage and salary increase submitted to the Board for approval would, if paid on and after March 17, 1972, result in the same aggregate payments as a 7 percent increase paid for the full wage year.”
      In its order, the Board holds: “ [I] t is ordered that the application for an exception is denied to the extent that the requested wage and salary increase is in excess of seven percent (7%) for the current wage year computed pursuant to the policies and regulations of the Pay Board. . . . The applicant may submit and the Chairman will approve payment of a wage and salary increase up to the amount submitted to the Board which is placed in effect no earlier than March 17,1972.”

      . 117 Congressional Record 43.673, 43.677.

      . To set out the pertinent legislative history, much of which is set out in the Government’s brief and appendix, would unduly extend this opinion. We note that the Senate committee specifically stated in its report on the Bill that it had rejected a number of proposed exemptions, including pay adjustments which apply to employees of State and local governments. Senate Report No. 92-507 ; 2 U.S.Code Cong. & Admin.News, p. 2286, 92d Cong., 1st Sess. 1971.
      In the House hearing, Secretary Connally, then chairman of the Cost of Living Council, in response to an inquiry by Representative Gonzalez as to whether State and local government employees were exempted, replied:
      With respect to State and local governments, let me simply say that I don’t think there is any question but that where Congress enacts legislation of this type it certainly is applicable to State and local governments. And it seems to me you can’t equitably impose a wage-price freeze, which we are in the midst of now, on the American economy and exempt State and local employees simply because State government, local governments have increased enormously both in terms of numbers of people and in terms of dollars.
      Hearings on H.R. 11309, 92d Cong., 1st Sess., parts 1 & 2, page 342.


author: PER CURIAM:

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Bobby Lee HODGE, Jr., Defendant-Appellant.
    No. 73-1740.
    United States Court of Appeals, Fifth Circuit.
    Dec. 14, 1973.
    Patrick J. Araguel, Jr., Columbus, Ga. (Court-appointed), for defendant-appellant.
    William J. Schloth, U. S. Atty., Charles T. Erion, Asst. U. S. Atty., Macon, Ga., for plaintiff-appellee.
    Before BELL, COLEMAN and RO-NEY, Circuit Judges.
   PER CURIAM:

Defendant, a soldier, was convicted of the armed robbery of two other servicemen on a military reservation, at Fort Benning, Georgia. 18 U.S.C.A. § 2111. He asserts basically three points on appeal: (1) the District Court did not have jurisdiction to try him, exclusive jurisdiction being in a military court-martial; (2) improper use was made of a confession allegedly obtained in violation of Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966); and (3) the trial court failed to fully instruct the jury as to the requirement of a unanimous verdict.

(1) Defendant grounds his jurisdictional objection on an inverse reading of O’Callahan v. Parker, 395 U.S. 258, 89 S.Ct. 1683, 23 L.Ed.2d 291 (1969), which held that a military court-martial did not have jurisdiction over a serviceman’s crime cognizable in a civilian court, committed off post and while on leave. Defendant reasons that where a crime having military significance is committed on a military reservation by a serviceman not on leave, only the military court system would have jurisdiction to try a soldier defendant. Hodge argues that his right to indictment by a grand jury in the civilian system is a substantially lesser right than that granted a serviceman by Article 32, Uniform Code of Military Justice, 10 U.S.C.A. § 832. Thus, claiming more comprehensive rights under the military system than those inherent in an indictment by a grand jury, defendant avers that he has an unqualified right to trial within the military judicial system for the crimes of which he was convicted.

Prior to O’Callahan, this Court held the military court and the District Court to have concurrent jurisdiction over crimes such as armed robbery. Schmitt v. United States, 413 F.2d 219, 225 (5th Cir.), cert, denied, 396 U.S. 959, 90 S.Ct. 432, 24 L.Ed.2d 423 (1969); Kennedy v. Sanford, 166 F.2d 568, 569 (5th Cir.), cert, denied, 333 U.S. 864, 68 S.Ct. 737, 92 L.Ed. 1143 (1948). Accord, Caldwell v. Parker, 252 U.S. 376, 40 S.Ct. 388, 64 L.Ed. 621 (1920); Peek v. United States, 321 F.2d 934, 936, 937 (9th Cir. 1963), cert. denied, 376 U.S. 954, 84 S. Ct. 973, 11 L.Ed.2d 973 (1964). We think that O’Callahan did not change the concurrent jurisdiction rule, but only limited the crimes over which a military court could assert jurisdiction. See United States v. Bixler, 321 F.Supp. 268 (D.Kan.1971). We do not read O’Callahan to mean that District Court jurisdiction is precluded just because the military court could assert jurisdiction.

(2) Hodge was arrested by military police who informed him of his rights and took him to the post’s M.P. Headquarters. Prior to any questioning, Criminal Investigation Division Agent Morgan repeated the Miranda and Article 31, U.C.M.J. warnings. Hodge evidenced understanding of his rights by requesting an attorney whereupon Agent Morgan terminated the interview, informed Hodge of the military procedure to obtain counsel, and explained the charges and evidence against him as required by Article 31(b) U.C.M.J., 10 U. S.C.A. § 831(b).

Hodge changed his mind and volunteered to make a statement. Agent Morgan did not accept it until Hodge waived his right to counsel. Hodge then made a confession, the validity of which was upheld in a Jackson v. Denno [378 U.S. 368, 84 S.Ct. 1774, 12 L.Ed.2d 908 (1964)] hearing. Portions of the confession were read into evidence by the Government while cross-examining Hodge at trial.

Hodge challenges the confession and its use. First, he contends that “once an accused has invoked his right to have an attorney present, all questioning and discussion for whatever purpose must cease until an attorney is obtained for the accused.” In support of this contention he cites United States v. Crisp, 435 F.2d 354 (7th Cir. 1970), cert, denied, 402 U.S. 947, 91 S.Ct. 1640, 29 L.Ed.2d 116 (1971). But Crisp is distinguishable for there the police subjected the defendant to intensive questioning immediately following a refusal to answer. In the case at bar, the interrogation was terminated and Hodge was informed of the procedure for acquiring an attorney, and of the case against him. His subsequent change of mind was voluntarily and freely made as was found in the Jackson v. Denno hearing. An arrestee can change his mind after requesting an attorney. Collins v. United States, 462 F.2d 792 (2d Cir.), cert, denied, 409 U. S. 988, 93 S.Ct. 343, 34 L.Ed.2d 254 (1972); United States v. Grady, 423 F. 2d 1091 (5th Cir. 1970); Wilson v. United States, 398 F.2d 331 (5th Cir. 1968), cert, denied, 393 U.S. 1069, 89 S. Ct. 727, 21 L.Ed.2d 712 (1969).

Second, he objects to the use made' of the confession. Recognizing that a confession may be used for impeachment, Hodge contends that his testimony was impeached when he affirmatively acknowledged that he had made a statement to Agent Morgan contrary to his direct testimony and implicating himself in the armed robbery. He claims it was error to question him by reading portions of the statement into evidence after he had admitted making prior contradictory statements and when the confession had not been offered as affirmative evidence by the Government.

The method used by the Government to impeach Hodge, however, was in compliance with the accepted rules of procedure: upon cross-examination he admitted making a prior statement contradictory to his direct testimony; he admitted that he recognized the statement which was shown to him; portions were read and Hodge was asked if he made the quoted statements. See 3A Wig-more, §§ 1025, 1036(2). When Hodge admitted that he had made a prior statement implicating himself in an armed robbery, portions of the confession were read to relate those statements to the facts of this case. In light of the statement’s voluntariness and inherent admissibility, there was no error. Cf. Harris v. New York, 401 U.S. 222, 91 S. Ct. 643, 28 L.Ed.2d 1 (1971).

Third, Hodge alleges that the court’s charge concerning the confession’s admissibility was erroneous since it had not been offered as affirmative evidence by the Government. He correctly asserts that the statement was before the jury for impeachment purposes only and that an instruction to that effect could be required. We have studied the testimony and the charge and find that Hodge made no objection to the charge at trial; that he did not request a particular charge; and that the charge given did not state that the jury could use the confession in an affirmative manner. The charge, if misleading at all, was not sufficiently so as to constitute plain error. Accordingly, we hold that any error in the charge was not grounds for reversal.

(3) Finally, Hodge contests the adequateness of the trial judge’s instruction concerning the necessity of a unanimous verdict. On two separate occasions during his charge, the trial judge employed the adjective “unanimous” to describe the type of agreement required in reaching a verdict. Although defense counsel expressed some concern, he did not request a poll of the jury to determine if in fact their verdict was not unanimous. A contrary contention on appeal is foreclosed. United States v. Nooks, 446 F.2d 1283 (5th Cir. 1971), cert, denied,, 404 U.S. 945, 92 S.Ct. 299, 30 L.Ed.2d 261 (1972).

Affirmed.


author: DUNIWAY, Circuit Judge:

text:
    William Bernard McKINNEY, Petitioner-Appellant, v. UNITED STATES of America, Respondent-Appellee.
    No. 72-3095.
    United States Court of Appeals, Ninth Circuit.
    Nov. 6, 1973.
    Richard G. Sherman (argued), of Sherman & Sturman, Beverly Hills, Cal., for petitioner-appellant.
    Richard J. Trattner, Asst. U. S. Atty. (argued), William D. Keller, U. S. Atty., Eric A. Nobles, Asst. U. S. Atty., Los Angeles, Cal., for respondent-appellee.
    Before DUNIWAY and WRIGHT, Circuit Judges, and TURRENTINE, District Judge.

       The Honorable Howard B. Turrentine, United States District Judge, Southern District of California, sitting by designation.

   OPINION

DUNIWAY, Circuit Judge:

On September 10, 1968, McKinney was convicted by a judge sitting without a jury under three counts of violating federal narcotics laws. 21 U.S.C. § 176a and 26 U.S.C. § 4742(a). After being sentenced to concurrent terms of five years on each count, McKinney appealed to this court and his conviction was affirmed. United States v. McKinney, 9 Cir., 1970, 433 F.2d 921. On May 5, 1972, McKinney filed a motion under 28 U.S.C. § 2255 alleging that at the time of his trial he was insane as a matter of law and therefore not competent to stand trial. The district court held hearings on this motion in May and August of 1972, and found that McKinney was sane at the time of his trial. We affirm.

On appeal McKinney claims that the court’s finding is not supported by substantial evidence and is therefore clearly erroneous. At the hearings on his § 2255 motion, McKinney offered his own testimony, that of a friend, and the testimony of his general practitioner, two psychiatrists, and a psychologist. All four experts concurred in the opinion that McKinney was not mentally competent to stand trial in September of 1968. McKinney’s trial attorney was not called as a witness, nor was anyone else, except McKinney, who was present at the trial. The govérnment did not produce any testimony as to McKinney’s competence to stand trial.

McKinney first argues that in a hearing on a § 2255 motion when a defendant presents expert witnesses who support his contention of insanity at the time of trial the government must present expert witnesses in rebuttal to sustain its burden of proof, citing United States v. Cooper, 9 Cir., 1973, 465 F. 2d 451; United States v. White, 9 Cir., 1971, 447 F.2d 796; United States v. So-bel, 9 Cir., 1971, 443 F.2d 1370; Hartford v. United States, 9 Cir., 1966, 362 F.2d 63; Buatte v. United States, 9 Cir., 1964, 330 F.2d 342. McKinney’s reliance on these cases is misplaced and his statement of the law is inaccurate. The cited cases deal with the burden of proof in cases in "which the defendant’s sanity at the time of the commission of a crime is questioned at the trial for that crime. In such cases, once a prima facie showing of his insanity is made, the government bears the burden of proving beyond a reasonable doubt that the defendant was legally sane at the time of the crime. United States v. White, supra, 447 F.2d 796, 797.

The issue here is different. The question is not whether McKinney should bear criminal responsibility for his actions, but rather whether he was sufficiently mentally competent to assist his counsel in litigating the issue of his guilt. A. Matthews, Jr., Mental Disability and the Criminal Law 17-21, 77 (1970); A. Goldstein, The Insanity Defense 184-5 (1967). The test for legal sanity in the context of competency to stand trial is accordingly different:

“[H]as [the defendant] sufficient present ability to consult with his lawyer with a reasonable degree of rational understanding — and [has he] a rational as well as factual understanding of the proceedings against him.” Dusky v. United States, 1960, 362 U.S. 402, 80 S.Ct. 788, 4 L.Ed.2d 824.

Furthermore, when the issue of the defendant’s competency to stand trial is raised in a § 2255 motion, the burden is upon the defendant to prove that he was not mentally competent to stand trial. Crail v. United States, 10 Cir., 1970, 430 F.2d 459, 460; and see Mealer v. United States, 9 Cir., 1967, 383 F.2d 849, 850. In sum, the issues and standards of proof here are different from those in Cooper, et al.

McKinney next argues that because the government presented no evidence of his sanity at the time of the trial, the district court’s finding that the defendant was sane at that time is clearly erroneous. This view rests upon the misapprehension that a trial judge, when ruling on a § 2255 motion, cannot take into account his own observations at the time of the trial. The law is clearly to the contrary. In Battaglia v. United States, 9 Cir., 1970, 428 F.2d 957, 959, we stated that:

“In these circumstances, the trial judge . . . had the right, and probably the duty, to place important reliance on his own views of appellant’s conduct during the course of the trial.” (Id. at 958)
“No one is in a better position to look at and analyze the record in light of the charges than is the trial judge who presided over the original proceedings.” (Id. at 959)

Accord, Mirra v. United States, 2 Cir., 1967, 379 F.2d 782, cert, denied 389 U.S. 1022, 88 S.Ct. 593, 19 L.Ed.2d 667; United States v. Smith, 4 Cir., 1964, 337 F.2d 49; Carvell v. United States, 4 Cir., 1949, 173 F.2d 348. See also Diamond v. United States, 9 Cir., 1970, 422 F.2d 1313, 1314.

Three of McKinney’s experts based their opinions entirely upon single sessions with him, held over three and a half years after the trial. The fourth expert is not a psychiatrist. None of the experts read the trial transcript.

The trial judge is not compelled to agree with the legal conclusions of medical experts, especially when the experts’ opinions are based entirely upon conversations held with the defendant over three and a half years after the trial. Moreover, increased deference to the trial court’s judgment is warranted when he has the trial transcript before him and is able to rely upon his own observations of the defendant at the time of the trial. Bishop v. United States, 1955, 96 U.S.App.D.C. 117, 223 F.2d 582, rev’d other grds. 350 U.S. 961, 76 S.Ct. 440, 100 L.Ed. 835.

The trial judge examined the experts’ reports, noting the lucidity of the defendant’s recounting of the trial to them, and heard their testimony. He weighed this evidence against his own knowledge of what happened at the trial, and that McKinney behaved rationally and competently at the trial. The trial court determined that McKinney had not met his burden of proof. We can not say that this finding was clearly erroneous. Hutson v. United States, 9 Cir., 1971, 437 F.2d 415, 416; Lepiscopo v. United States, 3 Cir., 1970, 426; F.2d 769.

Affirmed.

      . Floyd v. United States, 5 Cir., 1966, 365 F.2d 368; Roe v. United States, 8 Cir., 1963, 325 F.2d 556; and Sanders v. United States, 1963, 373 U.S. 1, 83 S.Ct. 1068, 10 L.Ed.2d 148, which relate only to the adequacy of the evidence supporting a trial court’s refusal to hold a hearing pursuant to a § 2255 motion, are not in point.


text:
    Alfred Joseph COLLINS, Petitioner-Appellant, v. WARDEN, NEVADA STATE PRISON, Respondent-Appellee.
    No. 73-1927.
    United States Court of Appeals, Ninth Circuit.
    Nov. 7, 1973.
    Rehearing and Rehearing En Banc. Denied Dec. 20, 1973.

      Robert J. Donovan (argued), San Francisco, Cal., for petitioner-appellant.
    Robert A. Groves, Deputy Atty. Gen. (argued), Robert List, Atty. Gen., Carson City, Nev., Robert Rose, Dist. Atty., Reno, Nev., for respondent-appellee.
    Before DUNIWAY and WALLACE, Circuit Judges, and SCHNACKE, District Judge.

       Tlie Honorable Robert H. Sclmacke, United States District Judge, Northern District of California, sitting by designation.

   OPINION

DUNIWAY, Circuit Judge:

Collins appeals from the denial of a writ of habeas corpus. We affirm.

In April of 1968, in Nevada State Court, Collins pled guilty to three charges, robbery, attempted robbery, and assault with a deadly weapon: He had also been charged with being an habitual criminal and, if convicted of that charge, he would have been subject to a mandatory sentence of life imprisonment without possibility of parole. This Consequence Collins was most anxious to avoid, and as a result there was plea bargaining. In that bargaining, it was agreed that the habitual criminal charge would be dropped, and it was dropped.

During the plea bargaining, Collins’ counsel told him that he would be eligible for parole. When Collins was sentenced, the state judge told Collins that he would be eligible for parole. However, there was no bargain as to whether the sentences would be concurrent or consecutive. The sentences imposed were consecutive: ten years on the robbery charge, three years on the attempted robbery charge, and six years on the assault with a deadly weapon charge. The state judge told Collins that the fact that the sentences were consecutive would not affect his eligibility for parole.

When Collins’ pleas were accepted, Nev.R.S. § 213.110 appeared to make him ineligible for parole because he had been convicted of more than three felonies. Collins then sought post conviction relief in the Nevada courts. This relief was finally denied by the Nevada Supreme Court. Collins v. Warden, Nev., 1972, 493 P.2d 1335. There, the court held that § 213.110 did not preclude parole; that it only precluded parole “outside the prison’s buildings and enclosures,” and that he could be paroled from the first sentence to begin serving the second and from the second to begin serving the third, so long as he remained inside the prison. It also held that Nev.R.S. § 176.035 did not prevent such successive paroles. Relief was denied.

Collins then turned to the federal court for habeas corpus relief. After a hearing, relief was denied. This appeal followed. The federal trial court denied relief on two grounds. The first is that “the prime thrust of the plea negotiations had been to eliminate the habitual criminal charge so that Collins would not be subjected to imprisonment for life without possibility of parole. The entire discussion before the change of pleas related to the elimination of the habitual criminal charges.” This finding is not clearly erroneous. See Albrecht v. Nelson, 9 Cir., 1972, 462 F.2d 623, 624. The federal trial court also found:

“Collins entered his pleas of guilty partly in reliance upon the representations by Erickson [Collins’ counsel] that he would be eligible for parole within three or four-years.”

In addition, the federal trial court held that insofar as parole eligibility may have been a part of the bargain, that bargain has, in substance, been fulfilled. This is because in 1971, Nev.R.S. § 213.110 was amended to eliminate the parole disqualification of a prisoner three times convicted of a felony. The federal trial court found, referring to the sentencing:

“At that time, the Court indicated that the Parole Board might put him out on parole in two and one-half or three years, ‘something like that, I don’t have it calculated but it is up to you.’ But this statement at the time sentence was imposed was not a representation which influenced the defendant in entering his pleas of guilty on April 22 and April 23, 1968.”
“There was understandably some confusion because of the recent change in the Nevada law, but the net result of what occurred is that the defendant actually received substantially what he bargained for.”

As to the decision of the Supreme Court of Nevada, the! federal trial court found:

“The effect of this decision applicable to Mr. Collins is that in view of the parole eligibility provisions of N.R.S. § 213.120, he would be eligible for parole under the ten year robbery sentence after serving two and one-half years, eligible for parole under the succeeding three year attempted robbery sentence after serving one year, and eligible for parole under the succeeding six year assault with a deadly weapon sentence after serving one and one-half years. Thus, taking all the consecutive sentences into consideration, the defendant would be eligible for parole outside the prison within five years ‘less good time credits.’ Under N.R.S. § 209.280, if total good time credits are earned, a ten year sentence becomes a sentence of six years and six months; a three year sentence becomes a sentence of two years and four months; and a six year sentence becomes a sentence of four years and two months. Taking these good time credits into consideration, it becomes evident that Mr. Erickson’s estimate and representation to the defendant that he could be paroled in three or four years was not far from the mark. ... If parole considerations are to be deemed important in this factual context as a consequence of the guilty pleas, it seems apparent that there was no substantial misinformation given to the defendant and that with the elimination of the habitual criminal charges, he would in fact receive from the plea bargaining negotiations substantially what he bargained for. This is particularly so in view of the fact that no one, before, during or after sentence, purported to assure the defendant that he would be eligible' for parole at any specific time or after serving any certain period of time.”

It concluded:

“In view of all the circumstances, it is the conclusion of the Court that the pleas of guilty by Collins were voluntary and understandingly tendered ft

These findings, too, are not clearly erroneous.

Before this court, the Warden asserts that eligibility for parole is not one of the consequences of a plea about which a defendant must be informed, citing Mathis v. Hocker, 9 Cir., 1972, 459 F.2d 988 and Bosley v. Hocker, 9 Cir., 1972, 460 F.2d 1064 (#1). Those cases, however, are not controlling here. So far as appears, in those cases parole eligibility was not mentioned, either in plea bargaining or when the pleas were accepted. Not so here; in our case parole eligibility was discussed, and, while it was not the primary motivation for the plea, it was .something that both counsel and the Nevada judge led Collins to believe that he would achieve. Collins argues that these facts bring into the picture the decision of the Supreme Court in Santobello v. New York, 1971, 404 U.S. 257, 92 S.Ct. 495, 30 L.Ed.2d 427. The essence of that decision is that:

“. . . [A] constant factor is that when a plea rests in any significant degree on a promise or agreement of the prosecutor, so that it can be said to be part of the inducement or consideration, such promise must be fulfilled.”

For the purpose of this case, we assume that the prosecutor, like defense counsel and the state judge, was a party to the representation about parole made to Collins in the course of the bargain. However, we expressly refrain from deciding whether these circumstances are equivalent to the kind of promise to which the Court referred in Santobello. Even if they are, it does not follow that Collins is entitled to relief. On the contrary, by the combined actions of the Nevada Supreme Court and the Nevada Legislature, the bargain has been kept. Collins has his parole eligibility. We can think of no good reason why action by the Nevada Legislature which fulfills the bargain should not be just as effective for the purposes of federal habeas corpus as action by a court or by the parole board.

Collins’ other arguments do not warrant discussion.

Affirmed.


text:
    Alexander STAVRIDES et al., Appellants, v. MELLON NATIONAL BANK & TRUST COMPANY et al.
    No. 73-1519.
    United States Court of Appeals, Third Circuit.
    Argued Nov. 6, 1973.
    Decided Nov. 26, 1973.
    Daniel M. Berger and Michael P. Mala-koff, Berger & Kapetan, James H. Joseph, Herbert G. Sheinberg and Stewart B. Barmen, Sheinberg, Raphael & Barmen, Pittsburgh, Pa., for appellants.
    Alexander Black and James Russell Sweeny, Buchanan, Ingersoll, Rodewald, Kyle & Buerger, Pittsburgh, Pa., for Union National Bank.
    J. Tomlinson Fort and James J. Resti-vo, Jr., Reed, Smith, Shaw & McClay, Pittsburgh, Pa., for Mellon National Bank & Trust Co.
    David B. Fawcett, Jr. and Daniel P. Stefko, Dickie, McCamey & Chilcote, G. Harold Blaxter, Blaxter, O’Neill, Houston & Nash, Pittsburgh, Pa., for Dollar Savings Bank.
    Harold H. Goldman, Goldman & Unatin, Pittsburgh, Pa., for Franklin Federal Savings & Loan Association of Pittsburgh.
    David S. Watson, Thorp, Reed & Armstrong, Pittsburgh, Pa., Judah I. Labo-vitz, Wolf, Block, Schorr & Solis-Cohen, Philadelphia, Pa., for Federal National Mortgage Assn.
    E. D. Hollinshead, Jr., Hollinshead & Mendelson, Charles F. Hodel, Jr., Smith, Hodel & Means, Pittsburgh, Pa., for First State Savings & Loan Assn.
    Alexander C. Sherrard and William M. Hoffman, Campbell, Thomas & Burke, Pittsburgh, Pa., for Pittsburgh National Bank.
    Judd N. Poffinberger, Jr. and W. Walter Braham, Jr., Kirkpatrick, Lock-hart, Johnson & Hutchison, Pittsburgh, Pa., for Century Federal Savings & Loan Association of Pittsburgh, Fidelity Savings and Loan Association, and West Penn Federal Savings and Loan Association.
    Edward L. Flaherty, Jr., Meyer & Fla-herty, Pittsburgh, Pa., for Century Federal Savings & Loan Association of Pittsburgh.
    Robert E. McMonigle, McMonigle & Vesely, Pittsburgh, Pa., for Fidelity Savings and Loan Assn.
    Frank R. Bolte and Donald S. Hersh-man, Baskin, Boreman, Wilner, Sachs, Gondelman & Craig, Pittsburgh, Pa., for Chartiers Valley Savings and Loan Association, Community Savings Association, Concord-Liberty Savings & Loan Association, Eureka Federal Savings and Loan Association, Fort Pitt Federal Savings and Loan Association, Friendship Federal Savings and Loan Association, Guaranty Savings and Loan Association, Home Federal Savings and Loan Association of Pittsburgh, Mt. Lebanon Federal Savings and Loan Association, Parkvale Savings Association, Regent Savings Association, Second Federal Savings and Loan Association of Pittsburgh, South Pittsburgh Savings and Loan Association, Stanton Federal Savings and Loan Association, Suburban Savings Association, Western Pennsylvania National Bank, Pittsburgh Home Savings and Loan Association, and First Federal Savings and Loan Association of Homestead.
    Clarence B. Nixon, Jr., Nixon & Nixon, Pittsburgh, Pa., for Chartiers Valley Savings and Loan Association and Fort Pitt Federal Savings and Loan Association.
    William H. Markus, Pittsburgh, Pa., for Concord-Liberty Savings and Loan Association and Home Federal Savings and Loan Association of Pittsburgh.
    Harry E. Leas, Gault, O’Donnell & Leas, Pittsburgh, Pa., for Eureka Federal Savings and Loan Association.
    John A. Virostek, Pittsburgh, Pa., for First Federal Savings & Loan Association of Homestead.
    C. John Tillman, Hirsch, Weise & Tillman, Pittsburgh, Pa., for Friendship Federal Savings and Loan Association.
    Carmen R. Capone, Evashwick, Brieger & Capone, Pittsburgh, Pa., for Guaranty Savings and Loan Association.
    C. Bryson Schreiner, Pittsburgh, Pa., for Mt. Lebanon Federal Savings and Loan Association.
    John R. McCaw, Alter, Wright & Barron, Pittsburgh, Pa., for Suburban Savings Association.
    Before VAN DUSEN, HUNTER and GARTH, Circuit Judges.
   OPINION OF THE COURT

PER CURIAM:

The issue presented by this appeal from a January 4, 1973, district court order, 353 F.Supp. 1072, entering judgment dismissing Counts Fourth through Ninth of the First Amended Substituted Complaint, is the validity of that portion of such order holding that the Fifth Count failed to state a claim upon which relief can be granted.

Paragraph 37 of such complaint states the claim of the Fifth Count under the Truth-In-Lending Act, 15 U.S.C. § 1639, as follows:

“In the one year preceding the commencement of this action, the representative and class defendants have extended new credit to the representative and class plaintiffs, or have transmitted to the representative and class plaintiffs periodic statements, and in connection with the extension of. credit to the representative and class plaintiffs reflected in their secured loans: (a) misstated the true effective annual percentage rate of interest by reason of the failure to include in the computation thereof the amounts required by the representative and class defendants to be paid on account of insurance premiums and taxes, which increase the effective annual percentage interest rates; and (b) intentionally and knowingly failed to disclose that payments on account of insurance premiums and taxes made by the representative and class plaintiffs and accumulated by the representative and class defendants bear no interest and are not credited to the borrowers’ principal debt balances.”

After careful consideration of oral argument, the briefs of counsel and the record, we have concluded that the above-mentioned district court judgment must be affirmed for the reasons stated in the district court opinion. See Stavrides v. Mellon National Bank & Trust Co., 353 F.Supp. 1072, 1079-1080 (W.D. Pa.1973). Similar reasons were advanced by the District Court for the District of Columbia in rejecting a similar claim under the Truth-In-Lending Act. See Graybeal v. American Savings & Loan Ass’n, 59 F.R.D. 7, 18-20 (D.D.C. 1973).

Supplementing the reasons given in the district court opinion, we note the following :

(1) The term “escrow” has been used in the mortgage business to describe monthly tax and insurance prepayments even though such payments are not segregated and without regard to whether interest is paid to the mortgagor. See First Federal Savings & Loan Ass’n v. Board of Equalization, 182 Neb. 25, 26, 152 N.W.2d 8, 9 (1967);
(2) The term “escrow” (15 U.S.C. § 1605(e)(3)) has been used by courts where one of the parties to the escrow agreement held the escrow funds and no independent escrow holder of the fund was contemplated by the agreement. See, e. g., Gulf Petroleum, S. A. v. Collazo,‘316 F.2d 257, 261 (1st Cir. 1963);

(3) Since the mortgagor has no right to withdraw his monthly tax and insurance payments, the arrangement challenged by plaintiffs-appellants complies with the following language of the Restatement (Second) of Trusts, § 12, Comment 1 (1959):

“Where the deposit is in escrow, that is where the money is to be paid to a third person on the happening of a designated event and in the meantime the depositor has no right to withdraw the money, it depends upon the manifestation of the intention of the parties whether the bank may use as its own the money deposited or whether the money shall be held in trust. Such a deposit ordinarily indicates an intention that the bank may use the money as its own . . . .”

For the foregoing reasons, the district court order will be affirmed.

      . A May 3, 1973, district court order made the certification and determination contemplated by F.R.Civ.P. 54(b) and entered final judgment dismissing Counts Fourth through Ninth of such complaint. The parties agree that if final judgment for the defendants was correctly entered on the Fifth Count, the defendants are entitled to entry of judgment in their favor on the other counts related thereto (Counts Seventh-Ninth). Also, plaintiffs concede that they “have not pursued Count Four in this appeal” and that they have consented to the dismissal of “Count Six” (see page 3 of appellants’ brief).

      . Other federal courts have expressly relied upon the district court opinion in gtavrides in dismissing similar claims. See Kinee v. Abraham Lincoln Federal Savings & Loan Ass’n, 365 F.Supp. 975 (E.D.Pa.1973) ; Munn v. American General Investment Corp., 364 F. Supp. 110 (S.D.Tex., 1973) ; Williams v. American Savings Ass’n, No. CA-3-6350-D (N.D.Tex., March 26, 1973). See also Umdenstock v. American Mortgage & Investment Co. of Oklahoma City, 363 F.Supp. 1375 (W.D. Okl.1973).

      . The case of Liberty National Life Insurance Co. v. United States, 463 F.2d 1027, 1030 n. 6 (5th Cir. 1972), relied upon by appellants in interpreting the term “escrow,” is distinguishable from the instant case since in Lib-berty National the court was concerned with interpreting the word “escrow” as it applied to mortgages insured by the Federal Housing Administration, which are subject to requirements not applicable to private mortgages.

      . We nóte that the staff of the Federal Reserve Board, which was designated by Congress to administer and interpret the Truth-In-Lending Act, has consistently concluded that the nonpayment of interest on such escrow deposits need not be taken into account in computation of the finance charge or the amount financed. In a Federal Reserve Board Public Information Letter dated July 15, 1971, No. 504, 4 CCH Consumer Credit Guide 1f 30,-707, Thomas J. O’Connell, General Counsel of the Federal Reserve Board, stated :
      “[Y]ou inquire whether the failure to allow interest on escrow deposits under a real estate mortgage should be reflected in the finance charge disclosed under Regulation Z. . . .
      “Section 226.4(e) . . . specifically excludes escrow deposits of the type you describe from the finance charge. In addition, although § 226.8(e) . . . provides that certain ‘required deposit balances’ must be excluded before determining the ‘amount financed’ (which would result in their being reflected in a higher annual percentage rate), that section specifically provides that it does not apply to escrow accounts of the type covered by § 226.4(e) .... By these two provisions it was the Board’s intention to allow computation of the annual percentage rate on real estate mortgages without regard to whether escrows were required, and by extension, without regard to whether interest was paid on those deposits. Consequently, it is the staff’s view that neither the requirement of escrow deposits, nor the failure to pay interest on them, must be reflected in the annual percentage rate or finance charges disclosed under Truth-In-Lending.”
      Similar conclusions have been expressed in Public Information Letters by J. L. Robertson, Vice-Chairman of the Federal Reserve Board, the Board member given specific responsibility for Truth-In-Lending (Letter No. 265, February 24, 1970) and by Griffith L. Garwood, then Chief of the Truth-In-Lending Section (Letter No. 580, March 8, 1972). 4 CCH Consumer Credit Guide K 30,518 and 1f 30,820.
      As recently as May 25, 1973, in another Public Information Letter, 4 CCII Consumer Credit Guide If 30,980, the Federal Reserve Board Staff reiterated its position. It was there stated :
      “ . . . The Regulation, however,' does not provide that the loss of interest on an escrow account represents a charge for the credit transaction to the customer. Under the same line of reasoning, the Regulation provides in § 226.4(f) . . . that interest or dividends paid by a creditor on a customer’s deposits or investments held by the creditor shall not be deducted from the amount of the finance charge or taken into consideration when computing the annual percentage rate.
      “By these provisions, it was the Board’s intention to allow computation of the annual percentage rate on real estate mortgages without regard to whether escrows were required, and by extension, without regard to whether intei’est was paid on those deposits. Consequently, neither the requirement of escrow deposits, nor the failure to pay the interest on them, must be reflected in the annual percentage rate or finance charges disclosed under Truth in Lending.
      “It might be noted that the Act allows a creditor to round the annual percentage rate to the nearest quarter of 1%, so that it is unlikely that the effect of the failure to pay interest on escrow accounts would require a higher annual- percentage rate to be disclosed in most cases (See § 226.5(b)) . . . . Also any disclosures taking into account the lack of escrow interest would often soon become inaccurate because such disclosures would be based upon the escrow requirements at the time the transaction is entered into, while the amount required for escrowed items typically continues to increase during the life of the mortgage as taxes increase. Finally, viewing such lost interest as a finance charge would further complicate already complicated disclosures perhaps to the consumer’s detriment, and would certainly increase the burden to the creditor.”