Orville L. Freeman et al., Appellants, v. Texas Rural Communities, Inc., Appellee, 330 F.2d 832 (D.C. Cir. 1964)

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U.S. Court of Appeals for the District of Columbia Circuit - 330 F.2d 832 (D.C. Cir. 1964) Argued January 28, 1964
Decided February 20, 1964

Mr. Frederick B. Abramson, Attorney, Department of Justice, of the bar of the Court of Appeals of New York, pro hac vice, by special leave of court, and Mr. Morton Hollander, Attorney, Department of Justice, with whom Asst. Atty. Gen., John W. Douglas, and Mr. David C. Acheson, U. S. Atty., were on the brief, for appellants. Mr. Frank Q. Nebeker, Asst. U. S. Atty., also entered an appearance for appellants.

Mr. Bryce Rea, Jr., Washington, D. C., with whom Mr. Thomas M. Knebel, Washington, D. C., was on the brief, for appellee.

Before EDGERTON, Senior Circuit Judge, and FAHY and BASTIAN, Circuit Judges.


As the case was presented to the trial court the question is whether appellants, the Secretary of Agriculture and the Administrator of the Farmers Home Administration, have authority to preclude Texas Rural Communities, Inc., appellee, from expending for annual administrative purposes an amount which appellants think excessive but which is well within 3 percent of the book value of the assets returned by appellants to appellee under the Rural Rehabilitation Corporation Trust Liquidation Act, 64 Stat. 98 (1950), 40 U.S.C. § 440 (1958). The Act provides that the agency to which the assets are returned, here appellee, shall agree "that not to exceed 3 per centum of the book value of [its] assets will be expended * * * for administrative purposes during any year, without the approval of the Secretary of Agriculture."

As we construe the statutory authority of appellants it does not authorize them to require a reduction of administrative expenses below the 3 per centum level when there is only a difference of opinion as to the amount needed for administrative purposes. In these circumstances approval by appellants would be necessary only if the percentage exceeded 3 per centum.