Leslie Miller, Inc., v. Arkansas

PETITIONER:Leslie Miller, Inc.,
RESPONDENT:Arkansas
LOCATION:Lion Oil Company Headquarters

DOCKET NO.: 51
DECIDED BY: Warren Court (1956-1957)
LOWER COURT:

CITATION: 352 US 187 (1956)
ARGUED: Dec 05, 1956 / Dec 06, 1956
DECIDED: Dec 17, 1956

Facts of the case

Question

  • Oral Argument – December 05, 1956
  • Audio Transcription for Oral Argument – December 05, 1956 in Leslie Miller, Inc., v. Arkansas

    Audio Transcription for Oral Argument – December 06, 1956 in Leslie Miller, Inc., v. Arkansas

    Earl Warren:

    Leslie Miller, Incorporated, Appellant, versus State of Arkansas.

    Mr. Smith.

    William J. Smith:

    Mr. Chief Justice, may it please the Court.

    In considering the application of Hill against Florida to the present case, it should be noted that the issue there was one of the supremacy of federal law under the Commerce Clause with a conflicting state law rather than strictly one of sovereign immunity.

    Here, we have the same issue of the supremacy of federal law over state law but it is reenforced in this case by the doctrine of sovereign immunity.

    I think what I say can be made clear by referring to two other cases.

    I think the closest case to our present one on its facts is Johnson against Maryland in 254 United States 51.

    There, the specific question was whether or not the Post Office Department was limited in hiring drivers to deliver mail in Maryland to individuals who had been licensed by the State of Maryland to drive motor vehicles in that State.

    And Mr. Justice Holmes speaking for the Court found that the Post Office Department should not be limited in its choice of drivers of its mail trucks to those who had been licensed by the State of Maryland.

    Now on the other hand the — the case which really gives us the — the greatest difficulty is the Penn Dairies case.

    There, the question was the application of the Pennsylvania law which imposed a minimum price on the sale of milk in Pennsylvania, the application of this law, the transactions between a Pennsylvania dairy and the United States which was buying milk for use in — in army camp.

    The Court held that the minimum price requirement of the State of Pennsylvania was applicable.

    It did so by treating this case in the same light as it would have treated a case of a non-discriminatory tax which is imposed upon an agency of the United States and where there is quite a line of cases now holding that as long as the — as the tax is non-discriminatory, it may be imposed even though there is an additional economic burden on the United States by reason of the tax.

    Reasoning from this basis the Court said, that this did not interfere in effect, it didn’t really interfere with the United States procurement of milk.

    It added an economic burden to it.

    It made — it may have caused the United States more to buy its milk but it didn’t really interfere, it wasn’t inconsistent with it.

    And that the additional economic burden was well merely one of those burdens which is the price of paying that we have to pay by having a dual sovereignty.

    The same thing drew up with James against Dravo Contracting.

    William J. Smith:

    That’s right.

    That was one of the tax cases itself.

    That was a tax case.

    Yes.

    William J. Smith:

    Now, in this — in the Penn Dairies case, there is — there is another distinction between this and the Penn Dairies case.

    In that case, it was specifically recognized that if Congress had desired to remove this activity from the field of state regulation, Congress would have had the power to have said so and that if it had its law would have been supreme that it would have removed it from — from the state law.

    Now, that’s important in this case because it comes down to the second leg of our argument namely, that here, Congress, through the Armed Services Procurement Act and the regulations which have been adopted pursuant to it, Congress has legislated with respect to this type of procurement in a way which excludes the State from regulating it at the same time.

    I — I don’t mean by this that Congress has said, “The State shall not regulate procurement.”

    I don’t think that Penn Dairies means that there should be a — a necessarily an outright statement to that but what — what appears here is that the legislation which has been enacted by Congress is so inclusive, so pervasive that it would be inconsistent to believe that Congress could believe that the States could regulate it at the same time.

    The Armed Services Procurement Act or pertinent portions of it are set forth in — in our brief beginning in — in the appendix, beginning at page 46.

    And that with respect to this type of — with respect to this type of contract, which is a contract which is placed by advertising, it is provided and I’m reading from page 49 of our brief, Section 3 (b), “All bids shall be publicly opened at the time and place stated in the advertisement.

    Awards shall be made with reasonable promptness by written notice to that responsible bidder whose bid conforming to the invitations of bids shall be found most advantageous to the Government, price and other factors considered.”

    William J. Smith:

    This vest in the contracting officers in this case the Corps of Engineers, the discretion to determine which bid is most advantageous to the Government and they in turn are guided by the regulations which are set forth in the pages which follow as to what consideration shall be given — shall be taken into consideration in determining which is the most advantageous bid.

    The Act itself gives — gives some guidance.

    For example in the first — in Section 2 of the Act, there’s a provision that in entering into such contracts, consideration shall be given to protecting small business.

    This then would be one of the considerations which would have to be considered in determining which bid should be accepted.

    Now in order to make concrete for this Court to be — the type of — the way these two laws would conflict, I think it be interesting to — to note the application in this particular case.

    In this case, bids were invited from 126 firms and bids were received from 16 bidders and Mr. Justice Brennan, there was only one of those that was located in — in Arkansas.

    Of the 16 bidders, seven only were licensed by Arkansas and nine were non-licensed.

    The engineers in going over the bids determined that Leslie Miller was the best, most advantageous, responsible bidder.

    It was not licensed.

    If — if the Corps of the Engineers had been governed by the Arkansas statute, it would have been necessary to sift through these 16 bidders and to — to take first the one that was most advantageous, Leslie Miller wasn’t licensed and go down through the list until it found one that was licensed.

    Now obviously, this is substituting for the discretion of the — of the Corp of Engineers as governed by the law and the regulations.

    It’s — it’s substituting a judgment of the State of Arkansas as to who should be licensed and who is licensed.

    And that I believe is a direct conflict which — which shows that the two laws cannot in — in effect live together and that in that case the federal law should be given the supremacy which is required by Article 6 of the Constitution.

    I would like, if I may, to — and go on amicus curiae, I would like, if I may, to reserve time for — for rebuttal if this would be agreeable to Mr. Davis.

    Earl Warren:

    Yes, you may do that —

    Felix Frankfurter:

    Mr. Davis, before you sit down —

    Earl Warren:

    — Mr. Davis.

    Felix Frankfurter:

    Wholly respecting your choice of not — not citing cases to which you are familiar, if it’s (Inaudible) why you didn’t cite Hill against Florida.

    I noticed you don’t refer to the Pacific case and go to some extent, there is some trouble in furnishing Penn Dairies, I should think your case is so much more like Pacific Dairy than Penn Dairies.

    But there must be some reason why you didn’t cite it.

    John F . Davis:

    There is a reason Your Honor.

    The reason is that —

    Felix Frankfurter:

    Is it exclusive?

    John F . Davis:

    Yes, of course.

    The reason is that we have not taken exclusive jurisdiction of — of the — of the (Inaudible) but —

    Felix Frankfurter:

    Well I know, but I mean the way the Court talked about what Penn Dairies (Inaudible) specifically showed the limited scope of that doctrine.

    John F . Davis:

    That — well, that is true but we can get no — no help from Pacific Dairies because here —

    Felix Frankfurter:

    Well, we can get — well, all right, give me your explanation.

    John F . Davis:

    Because —

    Felix Frankfurter:

    Penn Dairies went on the ground that it — it didn’t buy these contracting authorities, the army people there.

    John F . Davis:

    There is that language in the statute.

    I — I — it does not sound reasonable.

    That — that sounds presumptuous.

    I mean, I could — I could criticize the reasoning that it doesn’t affect the United States because it applies only to the other parties of the contract.

    I think it apply — that it does affect both the United States and the contracting party.

    Felix Frankfurter:

    I’m referring more particularly at all to the Penn Dairies unlike this case, it wasn’t required that the agents, officials of the United States were restricted or rather impliedly, it was argued that they were allowed, that they were free and not subject to such restriction that Pennsylvania invoked.

    John F . Davis:

    Yes.

    Both — there’s a very real difference in the factual situation because there, they can get their milk from these people that they choose.

    There is an economic burden on the United States to be sure.

    It costs more money to buy the milk but they can buy the milk from whomever they choose, and the Court treated the restriction as this — in the same way that it would treat a non-discriminatory tax as —

    Felix Frankfurter:

    In other words the — one of the considerations you’d allow it on, a different type of those cases like what are the considerations.

    I think, the importance was that there wasn’t a description.

    But you didn’t have to get the cheapest milk and therefore it’s fair to argue that Uncle Sam wanting to get particularly this purchase of milk as well as the other one.

    John F . Davis:

    That’s — that is right.

    And it didn’t — it didn’t fundamentally interfere with — with the — with the procurement in that case.

    Felix Frankfurter:

    No conflict would arise if a man is treated a supply (Inaudible) then it doesn’t restrict him to say it’s free to buy — you must buy from — that there’s an advantage, a public advantage in buying from (Inaudible) the more certified regulated milk, is that right?

    John F . Davis:

    That is right.

    I may say with respect to Pacific Coast Dairies that if there were exclusive jurisdiction of this — if the Government had taken jurisdiction so the state law no longer applied to this air field, it might well strengthen our case.

    It might — it might make it —

    Felix Frankfurter:

    The reason I don’t feel like you do about it is because to me exclusively my dissent is clear, didn’t solve the problem.

    John F . Davis:

    Well, I — I think in this case —

    Felix Frankfurter:

    All — I’m — I’m always — that you are concerned with the duties of the Court and not their qualifications, unsuccessful qualifications upon them.

    Earl Warren:

    Mr. Smith.

    William J. Smith:

    May it please the Court.

    I don’t recall what the issue in this case at all.

    I think the issue is clear.

    I think the issue can be taken from Penn Dairies as cited by or as stated by this Court in its opinion in Penn Dairies.

    There he said since the Constitution had left Congress free to set aside local taxation and regulation of Government contractors which burdened the national government, we see no basis for implying from the constitutional alone a restriction of all certain regulations which Congress has not seen fit to impose unless the regulations are shown to be inconsistent with congressional policy citing cases and continuing.

    Our inquiry here therefore must be whether the state regulation of this contract in a matter of local concern, conflicts with congressional legislation or with any desirable congressional policy.

    I agree 100% that that’s the issue in this case.

    William J. Smith:

    We think that Congress has created a framework of legislation for the letting of these contracts, these construction contracts and other types of contracts but — but particularly a construction contract within the framework of these state regulatory laws and the reason I say these state because approximately one half of the states have a similar law.

    Now, before proceeding further with the — with the issues on the law, I would like to give some background in view of the argument yesterday as to the purpose of this law or certainly to say that these laws have only for their purpose the protection of the owner who deals with the contractor as a fallacious argument.

    These laws seek to protect the — the state assets, the people assets, the welfare and the health of the people.

    The construction industry is one of the most important segments of the industry of any state or the economy of any state and to stabilize the construction and receive one of the purposes of this law and now the states have followed the same procedure in enacting similar laws.

    This law has been on the statute books in Arkansas since 1939.

    There’s never been one case cited to you or one instance where this board has tried to be arbitrary or tried to keep outsiders out of the State of Arkansas or tried to use it for any improper motive elements and to accomplish the purposes of the law and that’s to stabilize the construction industry within the borders of Arkansas.

    Felix Frankfurter:

    Is the question before it?

    William J. Smith:

    Yes.

    Felix Frankfurter:

    We’re not to confront it with the problem of striking down this law, the problem before us is this restriction on Uncle Sam himself is concerned.

    With the — merely in the words.

    William J. Smith:

    I quite agree with you Mr. Justice Frankfurter and unless Congress has specifically prohibited such regulation such as it has done in the Atomic Energy Act passed upon by this Court in Carson v. Roane-Anderson, cited in our brief, then that restriction has not been laid upon the states.

    Felix Frankfurter:

    So that is — they’re not offering that as applied position of the law, then Congress would say in (Inaudible)

    Well this Court I suppose is, I don’t know why.

    Probably a hundred cases certainly at the beginning of time, I can say that they started in which this Court has stricken down state legislation because of the implied contract with some overriding federal authority.

    William J. Smith:

    I — I quite agree with that purpose, yes.

    And if there the implied conflict here with congressional enactment or congressional policy then the state law must follow.

    It should be my purpose to show that there’s no conflict for instance there has no standard form of contract adopted for construction contracts cited in our brief at page 10, United States standard form contract on Title 41 in the appendix, 41, Section 54413 provided in part, Article 10, “Permits and responsibility for work, the contractor shall, without additional expense to the Government obtain all required licenses and permits.”

    Now Congress in other instances and I think that it’s fair to assume that that is an — is one way to get at the intention of Congress.

    It has provided for special immunity of its contractors and of course this Court has held that contractors do not or not close with the immunity of the Government by reason of the relationship between the Government and the contractors.

    Now —

    Felix Frankfurter:

    I think you can tax the contractors where their money it makes out of Uncle Sam.

    William J. Smith:

    Yes, sir.

    Felix Frankfurter:

    That’s a very different problem.

    William J. Smith:

    We read the cases to state taxation and regulations as to that.

    If we’re in error in that connection, we might be.

    We think that this Article 10 in the standard form must mean something.

    It specifically provides for the obtaining of permits and licenses.

    What else does it mean?

    In — in the Morgan case cited in our brief, Morgan versus the State of Arkansas for the use of benefit of Philips County, appeal was dismissed by this case citing the — the Stewart case which an out-of-state contractor came in, did not comply with the laws regulating corporations.

    They’re doing their business by corporations, perform the contract for the Government and the White River Levee District, suit was brought, a penalty was laid.

    William J. Smith:

    It was appealed to this Court and the appeal was dismissed.

    On the ground, there was no substantial federal question.

    Here, there has been no interference with the work.

    A penalty has been laid on this contractor for violating the state law.

    The appeal is here.

    Frankly, we don’t distinguish the cases.

    What — what’s that case?

    William J. Smith:

    Morgan — if you please, it’s relied upon by the Supreme Court and it was cited in our — here it is, E.E. Morgan Company, Incorporated, versus State, Use and Benefit of Phillips County, 202 Arkansas, 404, 150 S.W.2d 736 and I’m sorry I’m quoting from the Supreme Court’s decision there.

    We do not have your citation.

    I believe it’s 314 U.S.

    Earl Warren:

    Is there any distinction, Mr. Smith, between the Government’s use of this unlicensed — this unlicensed contractor on the one hand and its use of unlicensed architects or engineers, doctors, veterinarians, or any other licensed group but that the State didn’t variably does license?

    William J. Smith:

    I — I think that the distinction is that in those cases, those professional cases, the Government only is affected.

    Now in the case of the Johnson v. Maryland, it was cited a few moments ago, there is a government employee.

    And the Government is responsible in that case for its employee.

    Our state statute specifically exempts under Section 15 and that may be found in appellant brief at page 28, I believe.

    Our state statute specifically exempts authorized representatives of the Government.

    Earl Warren:

    Yes, but it might — might not be an employee of the Government, it might make that contract with an architect to draft — to design a building.

    They might make a contract with a health service to perform services for the Indians or for veterans or for some — or for some other group from the State.

    It might employ — not employ but make contract with veterinarians to render some service to the farmers of the State would — do they apply there?

    William J. Smith:

    The way we meet that issue in this case, Your Honor, is we turn back to the apparent intent of Congress.

    Earl Warren:

    Yes.

    William J. Smith:

    Because in this case, they have adopted a standard form providing that permits and licenses will be obtained by the contractor.

    They can afford a representative.

    There are ways to accomplish what the Government seeks to accomplish without striking down the state law.

    Now in the case of an architect, it may be different and we find nothing in the regulations that shows that that problem has been considered and any provision has been made for where here we didn’t find a specific regulation providing for permits and licenses and that’s the only distinction I can find.

    But where is your Section 10?

    William J. Smith:

    Article 10, you’ll find it in appellee’s brief, Your Honor at — at page 10, Article 10 on the — next to the last paragraph in the appellee’s brief.

    All required licenses and permits.

    William J. Smith:

    Sir?

    That he shall obtain all required licenses and permits?

    I suppose that means all valid licenses, all valid for the required licenses?

    William J. Smith:

    I would assume it would, yes, sir.

    Now, after — I don’t know what permit and license it could refer to other than to a state permit or state license.

    Tom C. Clark:

    Can it give the permit?

    William J. Smith:

    Pardon?

    Tom C. Clark:

    (Inaudible)

    William J. Smith:

    Oh, yes, Mr. Justice Clark.

    We have any number of local and state regulations affecting the building industry.

    I — I’d speak for Arkansas alone because I’ve studied those.

    We know that they’re uniform throughout the State usually.

    We have a general contractor’s license.

    We have a master plumber’s license on the state level, a local plumber license on the local level.

    We have electrician’s licenses required.

    All of these are laid in the police power to the State for the health and welfare and they involved important functions so far as society is concern.

    Now, I would like to reach the argument made yesterday that this law could not have been intended to affect workmen, the safety of employees or it would not have been the $20,000 requirement put in.

    Well again, I — I don’t agree with that premise at all because the magnitude of the work to be regulated is one of the important things we all know that our workmen’s compensation law of course at some states they have three employees, some five, some eight.

    One State I remember Kentucky as high as 14 under certain industries.

    It’s the overall impact upon the community and there why — if a general contractor or contractor has a contract of less than $20,000, the State has decided and when the law was originally written, it was $10,000.

    It was amended to go to $20,000 in view of inflation because a project costing less then that and it maybe a building downtown as well as out on an air field, there are passersby, there — there are citizens going and coming on the sidewalks, on the streets near, there are employees on the job, there are material men dealing with the contractors, there are subcontractors dealing with it.

    An argument may be there that we have the Miller Act on federal projects.

    It may be argued that we have the MiIler Act but we all agree that the Miller Act doesn’t protect everybody in every sense, we don’t even had an argument before this Court yesterday that it was not reaching one of the problems of the workmen on their welfare fund.

    So we say that Congress has not specifically legislated in this field and has not legislated in the field to such an extent as to imply that this law is in conflict with congressional enactments.

    William J. Brennan, Jr.:

    Mr. Smith, may I ask?

    William J. Smith:

    Yes, Mr. Justice Brennan.

    William J. Brennan, Jr.:

    I don’t know if it’s in your brief but I — the brief of the appellant at page 33, Section 5 of what appears to be an amendment, I gather, of the 1939 Act says that, (Inaudible) the purpose to prevent unfair competition and delay in construction while they needed facilities apprehending an increase in construction business in a vast influx of contractors from other sections.”

    Now I would have read into that any limitation upon purpose of this legislation generally?

    William J. Smith:

    No, sir.

    I think that’s read fairly well and there’s a history behind those emergency clauses.

    We know that many times they were drawn very loosely.

    That’s an emergency clause in order that the Act may go into effect consigned by the Government otherwise it would have been 120 days after the Government signed it.

    William J. Smith:

    And the emergency clause is not usually digested.

    In this case, I would look in back to see the emergency clause to the original Act and if you look on page 30, there is an emergency clause there.

    Section 22 to the original Act and it’s accustomed to track this emergency clauses on to legislation in order to put them into effect and we — we’ve had many emergency clauses of course attacked and in that case they fall unless they measure up to the requirements of an emergency clause.

    We don’t think that this emergency clause can be taken to fairly state the scope of the law.

    This —

    Earl Warren:

    Mr. Smith, there was one thing that — that bothered me here and that is that your — your law apparently not only requires them to have this license in order to transact in the contracting business but it also requires them to have the license at the time they bid.

    William J. Smith:

    Yes.

    Earl Warren:

    Now, if the Government calls for bids on — on a large or on any project and it has — a contractor isn’t licensed, he has to wait either until one of the semiannual meetings of your — your board or the board has to hold a special meeting for him and he must give 30 days notice before for that meeting.

    William J. Smith:

    That’s correct, Your Honor.

    Earl Warren:

    Now — now, many government contracts I — I think will — will provide for letting the contract within the 30 days.

    William J. Smith:

    Yes.

    Earl Warren:

    And then that — that would mean that there was a burden on the Government at least to — to the extent that they could not consider such contractor.

    William J. Smith:

    Yes, sir.

    Earl Warren:

    You don’t — and you don’t think that that is an undue burden on the Government.

    William J. Smith:

    I would like to meet that issue —

    Earl Warren:

    Yes.

    William J. Smith:

    — in this manner, if you please, Mr. Chief Justice.

    Earl Warren:

    Yes.

    William J. Smith:

    We think that that is some burden.

    We also think that Congress can remove that burden anytime it wants to just as it did in the Atomic Energy Act.

    Now, the mere fact that there is some burden as been held by this Court is not sufficient to strike the law down.

    Now — now what is that burden in this particular case?

    The Government has agreed that the Board meets on an average of 18 times a year even though the loan it requires to meet in February and August, there is no showing that anyone has a difficulty in getting an audience with the Board or getting the application passed upon.

    Now, in addition to that and that’s been the long time history and certainly this appellant here represented by a corporate counsel, I believe they would erase every defense they could have.

    But there’d been no showing of any abuse of discretion or any attempt to restrict in that manner.

    Now, one of these government projects, this particular airport for instance to give a background and I’m going outside the record but I’m sure there’ll be no objection.

    The people of that community raised money over a period of six or eight months and brought this property and gave it to the Government.

    We were anxious to get the Government in there and contrary to some remarks in the brief with my opposing counsel we’re not trying to keep the Government out of Arkansas a construction now.We are happy to have all the construction they’ll give us.

    But these contractors knew that this project was coming up.Six of the seven that were licensed came in there and qualified.

    There is no showing it could not — not have qualified or there was any unreasonable requirements or any attempt to keep him from qualifying.

    William J. Smith:

    Now of course when you say — and — and the very fact that 136 invitations were sent out to show that it’s not highly specialized.

    I think the Government will consider itself fortunate anytime it gets seven qualified business and there’s nothing here to show that there was anything more than an economic burden.

    They said they had seven licensed.

    Now, I don’t know what the difference was in the bids.

    The Government hasn’t set it out.

    It might have been $5.

    I don’t know.

    But I still go back to the proposition which this Court has said over and over that Congress is able to strike down these state laws when it feels as a matter of congressional policy, that the state law imposes too great a burden on the federal government and that’s our case.

    If this Court determines that it does that it impliedly conflict or specifically conflicts then we realize a state law of United States.

    We recognize the supremacy of the federal law in this field.

    Do you think the regulations of the armed forces they had on the Government’s brief 49 in case the Government can (Inaudible)

    William J. Smith:

    Yes, sir.

    And I think that this — this Article 10 that we have quoted a part of that goes right on it.

    It has moved in this field.

    That’s one thing we say that distinguishes it.

    Do you think the nation set out the same thing, it’s you and it’s your statute?

    For example, they say prior to the award that the — and the contracting officers didn’t make investigation to see where the construction contractors have the financial resources in order to secure the necessary (Inaudible) and all of those things.

    Do you think that those regulations in case the Government asserted them is already making steps in this field to take the (Inaudible) together.

    William J. Smith:

    I think that those regulations could be reasonably construed to supplement any regulations requiring permits and licenses on a state or local level or else it would not have in their standard form adopted pursuant to the — to the proper legislation and — and the executive order authorizing the adoption of that form.

    They would not here provided.

    Now, if this law falls, is there any reason why a plumber’s law, our electrician’s law, and all the others going down the line if it falls.

    Tom C. Clark:

    The Government hasn’t made a regulation for plumbers, have they?

    William J. Smith:

    The same regulation would apply to the plumber that you’ve just referred to, Mr. Justice Clark.

    Same one I mean that have to let the same kind of contract that’s a construction contract.

    Tom C. Clark:

    Then that depends on the general construct — contractor where the contractor would be responsible for all the construction (Inaudible) the service.

    William J. Smith:

    Well, the general contractor — when he contract, that Government are responsible for everything only.

    Now, he may or may not subpart of it but if the general contractor under the laws of Arkansas, and I’m sure you’ll find the same in other states.

    A general contractor has no right to perform plumbing unless he has a license to perform plumbing, yet he contracts with the Government to install that plumber.

    The same thing with the electricians and the other licensees — licensing laws pertaining to the building industry.

    The building industry has grown to be complex.

    William J. Smith:

    We all know that.

    It’s probably the largest industry, income wise, and — and employee payroll wise, and materials and everything in our entire country.

    Let us say half of our states have seen fit to adopt this similar law.

    William J. Brennan, Jr.:

    But Mr. Smith I noticed that Section 9 of your Act, I gather it’s the one still operative which establishes the standards for judgment whether a license shall or shall not issue.

    William J. Smith:

    Yes.

    William J. Brennan, Jr.:

    Speaks of experience, ability, character, the manner of performance of previous contracts, financial condition, equipment, any other fact tending to show ability and willingness to conserve the public health and safety and therefore complying with the provisions of this Act.

    William J. Smith:

    Yes, sir.

    William J. Brennan, Jr.:

    Now as to the first — now perhaps as to all, it’s the last two, don’t the Government regulations require the inquiry of the contracting officer to be made upon the same standards because looking at page 49 of the Government’s brief, the ones that Mr. Justice Clark referred to, financial resources necessary experience and so forth, I think pretty much the same thing.

    William J. Smith:

    Yes, sir.

    Generally speaking, they do.

    William J. Brennan, Jr.:

    Well, now what — what’s — what’s the case then when there’s a difference of view as between the state board and the contract — federal contracting officer on each of those requirements.

    I gather your position is that nevertheless the state board’s determination must control.

    William J. Smith:

    Yes, sir.

    We think that they’re required under the law to have a state license.

    And if the Congress intended otherwise, since they have acted and that is for you in certain instances such as the one I’ve mentioned a moment ago that was passed on by this Court in Carson v. Roane-Anderson.

    Since Congress has acted to grant immunity or to free its contractor from regulation under certain circumstances.

    We feel that if they had intended — if Congress had intended they’d be free from these regulatory statutes, they would have so fully.

    William J. Brennan, Jr.:

    You don’t view the procurement regulations which of course I gather are conceded to have been enacted pursuant the statute have the same effect as the Congress had acted in this regard as to qualification of the contractors.

    William J. Smith:

    We think they would be supplemental.

    We don’t think that they cover all appeals.

    They’re required in the state law.

    They cover some of them.

    That’s true.

    We don’t think they cover all of them.

    William J. Brennan, Jr.:

    Does the board have regulations as to the qualifications of those who come in?

    William J. Smith:

    The Board has —

    You have the printed regulations.

    William J. Smith:

    No, sir.

    We don’t have the printed regulations.

    We have the necessary forms that an — an applicant completes and during the period of inquiry —

    Do you have any standards which are specific as to what the contractor has to have for a million dollar (Inaudible) job, does he have to have a — any sort of a trained architect, does he have to —

    William J. Smith:

    The Board in passing upon that treats every applicant within the information furnished from that applicant and the references, the information obtained by the end of it — end of independent investigation conducted by the Board as to ability, character, equipment, financial, background, all those things just mentioned by Mr. Justice Frankfurter.

    (Inaudible) experience as to all the rest.

    William J. Smith:

    Yes.

    And what experience does he have to have?

    William J. Smith:

    He must be experienced in the particular field that he proposed as to (Voice Overlap).

    (Voice Overlap) five years or 40 years?

    William J. Smith:

    The Board has not laid down specifically one or two or three or five or any number of years.

    William J. Brennan, Jr.:

    Contractor X wanted to go into Arkansas, he wouldn’t know what qualities he has to have.

    William J. Smith:

    No, sir.

    He would complete the application and most contractors now of this magnitude on projects of $20,000 or more are companies or corporations, or organizations, they’re no longer individuals because of the vast scope of this industry.

    And therefore the — the experience of the organization, his staff, and all those things are taken into consideration by the Board rather than the ability of one particular man.

    William J. Brennan, Jr.:

    Well, I gather Mr. Smith, this is — this is confined isn’t it to general contractors as it is defined.

    William J. Smith:

    No, sir.

    William J. Brennan, Jr.:

    It’s not?

    William J. Smith:

    No, sir.

    The law says the minute that —

    William J. Brennan, Jr.:

    What?

    William J. Smith:

    — where general contractors appears in the Act, it means contractor.

    William J. Brennan, Jr.:

    Well, tell me is the composition of the board as originally provided in Section 2 limited to general contractors of certain experience and residents in Arkansas?

    William J. Smith:

    No, sir.

    The composition of the board requires that one member that they first must have 10 years experience in the industry.

    William J. Brennan, Jr.:

    Is this by the reason of the amendment?

    William J. Smith:

    No, sir.

    In the original Act, I think you’ll find —

    William J. Brennan, Jr.:

    Well, I’m looking at page 21 again of the appellant’s brief, Section 2, same setup that each must be at least 35 years old and a general contractor not less than 10 years of experience and responsible charge of construction projects of magnitude consistent with the duties of his office.

    William J. Smith:

    Yes, sir.

    And then goes over and at least one member said the Board shall have as the larger part of his business in construction the highways, at least one member set forth should’ve had a larger part of his business construction of sewers and waterways.

    This one member of the board shall have a large part of his business in construction of buildings.

    Now, that lays a specific requirement on only three and lays a general requirement of 35 years of age and 10 years on all (Inaudible).

    William J. Smith:

    It’s been the Government practice to — for its specialty contractors, so they have the two vacancies.

    It’s never — I mean it — it’s been maintained throughout the years.

    Let’s say we’d have this law 18 years as a balanced board that has been recognized by the industry and the people is being qualified to speak of it.

    Tom C. Clark:

    Mr. Smith, you’ve indicated other states had a similar law?

    Could you tell me how many other states?

    William J. Smith:

    The last time I check, Mr. Justice Clark, I believe it was 21 or 22.

    I — I remember —

    Tom C. Clark:

    All summarized (Inaudible) of the board?

    William J. Smith:

    Yes, they have a board.

    And Mr. Chief Justice I believe California has the strongest one.

    Out there, there’s no limitation.

    If you called yourself a contractor you have to be licensed, I mean it’s about that strong.

    But there’s New Mexico, the Government has referred in its brief to some of these but there’s New Mexico, Louisiana, Tennessee, Alabama, North Carolina, South Carolina, that I recall handled it.

    But many of the states have seen fit in that because of the — the growth of the construction business.

    The impact of the whole industry upon the economy of the State and they attempt to stabilize, we all know that the totality — totality rate among contractors is the highest of any known industry now.

    I’m going outside the record, but that’s true, (Inaudible)

    Felix Frankfurter:

    (Inaudible) by the record.

    Does it appear whether it is contracted by the — exclusive, the Government (Inaudible)

    William J. Smith:

    Oh, I’m sure he does not.

    Felix Frankfurter:

    Well, then you got him whenever it is local business.

    William J. Smith:

    Yes.

    Felix Frankfurter:

    Even he does exclusively, the Government, can it, in any — essentially within the Johnson case.

    (Inaudible) also has in local business, we get them under local business.

    All the segregation argument is covered by that situation.

    William J. Smith:

    Well, of course I must respectfully disagree with that fairness because I think that when the Government comes into community and — and spend several million dollars or maybe 80, 90 (Inaudible) different job although —

    (Inaudible)

    William J. Smith:

    — the building of this airport I suspect cost $50 million or $60 million dollars.

    This was one project on there.

    Below, we had five cases, four at this particular project and one from Fort Smith, Arkansas.

    That was a — a contract for a National Guard Armory.

    William J. Smith:

    Those four cases were not appealed, one of the five, all five were sustained below.

    One has been appealed.

    Felix Frankfurter:

    What would you say if — if this — if an Arkansas contractor restricts himself, the Government would — would that be a different case from this?

    William J. Smith:

    Yes, sir.

    We say that if the Government takes exclusive jurisdiction and I — I realize —

    Felix Frankfurter:

    No, no, I’m not —

    William J. Smith:

    I — I realize — I realize —

    Felix Frankfurter:

    It’s (Inaudible) seen as a matter of choice.

    This fellow says, “I’d only — I like the word conversant, for various reasons, I’m (Inaudible) paint —

    William J. Smith:

    No —

    Felix Frankfurter:

    — and on United States Government job.

    William J. Smith:

    We say he is still an independent contractor.

    He is not clothed with government immunity that he deals in the community.

    He works with employees of Arkansas.

    He buys his supplies from the supplier of Arkansas.

    He employs subcontractors and overall, the object of — of the state law.

    Felix Frankfurter:

    But I thought you just (Inaudible) the Johnson case on the ground that he’s only working for Uncle Sam.

    William J. Smith:

    No, sir.

    I distinguish the Johnson case on the ground — I’m sorry, you misunderstood me, that he was an employee for Uncle Sam and Uncle Sam would be responsible for his actions and that he —

    Felix Frankfurter:

    I suppose that it would, knowing that they still are but certainly at the date of my youth, there were people who didn’t (Inaudible) for the United States with contractors and not have been (Inaudible)

    In — in the (Inaudible) there were contractors, they wouldn’t be subject to — they wouldn’t be subject to local law.

    They would put out — I thought it must be —

    William J. Smith:

    I don’t know.

    I don’t know Mr. Justice Frankfurter to what extent Congress has legislated in that field.

    I would not pass an opinion.

    Felix Frankfurter:

    I’m suggesting that you’re not — if Congress really told that it’s mine, that’s why I gave up trying to find out what the intention of Congress is.

    If Congress tells it’s mine in English then there’s no problem.

    The problem is when it doesn’t tell us, it doesn’t know exactly because it has any problem.

    William J. Smith:

    I quite agree with you.

    We have a problem in this case.

    William J. Smith:

    I — I do not say if Congress had specifically legislated, we would not be here.

    Felix Frankfurter:

    Either way, one way or the other.

    William J. Smith:

    Yes, sir, yes.

    And I realized that this Court could determine there’s a difference between the point in this case.

    Felix Frankfurter:

    I put the fact there’s a general — and I think this is relevant in my defense.

    I’m sure on the showing that this describes a general problem, that’s a different story from what I understand and when Uncle Sam didn’t reach the choice that he’s — that he would be doing direct government work by what the State wants.

    William J. Smith:

    I’d say they cannot be restricted if Congress speaks.

    We don’t think Congress has spoken to that extent in this case.

    We say that in line with the Penn Dairies case and other cases decided by this Court that Congress always has the ability to relieve the burden whereas if there is any damage done or any harm resulting from an opinion of this Court, the State is parallel to remove that harm.

    Felix Frankfurter:

    Let me suggest another question of — to this problem.

    It has been suggested that this presents you — I noticed (Inaudible) often exclusively the civilization of the industry (Inaudible)

    This may be also protective of the employee to a certain deal after — you’re holding of the people (Inaudible) government could interpret speculations, I suggest that Uncle Sam may be aware of the facts that sometimes licensing agencies in different states are not (Inaudible) but licensing agencies have been known to play favorites.

    That’s not unknown in the history of licensing.

    William J. Smith:

    I quite agree, yes.

    Felix Frankfurter:

    The Government speculate as to what mischief maybe done, somewhat evil or (Inaudible)

    And Uncle Sam ought to be subject to that kind of favorite play licensing.

    William J. Smith:

    And Congress could always act to remove any burden that maybe shown to exist.

    Earl Warren:

    Well Mr. Smith, one of the things that bothers me is apparently Congress has picked some standards for the award of bids to responsible bidders.

    It was determined what a responsible bidder is and this character, reputation, ability and experience and so forth.

    Now, when it — when it determines to do that, is it not in so doing excluding the right of the State to determine who is qualified by reason of experience, character and — and so forth?

    William J. Smith:

    We feel that if these regulations had been sound on permits and licenses that could have been implied.

    Yes, sir.

    But we feel that in the announcement of the formed contract that they must get permits and licenses that must have meant something and we don’t know of any other kind of permits and licenses that would have to get except licenses.

    Earl Warren:

    Thank you, Mr. Smith.

    Mr. Davis, do you have some —

    John F . Davis:

    I have no more —

    Earl Warren:

    — rebuttal?

    John F . Davis:

    Nothing to add unless there’s some more questions, Your Honor.

    Earl Warren:

    Very well.