Morgan v. United States

Background

Market agencies that run livestock services at the Kansas City stockyards challenged a Department of Agriculture order that set maximum commission rates. The Secretary began an investigation in 1930, heard thousands of pages of evidence before an examiner, and issued an order in 1933 based on lengthy findings prepared in the Bureau of Animal Industry. The agencies say they never saw those bureau findings or a government brief and were denied a real chance to know and answer the Government’s specific claims.

Reasoning

The Court focused on whether the statute required a “full hearing.” It found the Secretary had not personally heard the case, instead reading briefs and transcripts, conferring with bureau staff, and adopting the bureau’s 180 findings after ex parte discussions. The Court stressed that a fair hearing means not only presenting evidence but also having a reasonable chance to learn the opposing side’s concrete claims and respond. Because the agencies were not given that opportunity, the Court held the hearing fatally defective and invalidated the rate order without deciding the underlying merits.

Real world impact

The decision cancels the Secretary’s 1933 rate order and sends the matter back to the lower court for further proceedings consistent with the opinion. The Secretary may conduct new administrative steps, but any future order must give market agencies a proper opportunity to see and contest the Government’s proposed findings. The ruling leaves open the substantive question whether specific rates are reasonable.

Dissents or concurrances

Justice Black dissented, and Justices Cardozo and Reed did not participate; the opinion gives no detailed dissenting reasoning in the text.