BARNHART v. PEABODY COAL CO.

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Case Basics
Docket No. 
01-705
Petitioner 
Barnhart
Respondent 
Peabody Coal Co.
Consolidation 
No. 01-715
Advocates
(Argued the cause for the respondents Peabody Coal Company et al.)
(Argued the cause for the petitioners Holland, et al)
(Argued the cause for the petitioner Barnhart)
(Argued the cause for the respondents Bellaire Corporation, et al)
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Facts of the Case 

Under the Coal Industry Retiree Health Benefit Act of 1992, the Commissioner of Social Security "shall, before October 1, 1993," assign each coal industry retiree eligible for benefits under the Act to a company, which shall then be responsible for funding the beneficiary's benefits. After October 1, 1993, the Commissioner assigned 600 hundred beneficiaries to various coal companies. The companies challenged the assignments, claiming that the statutory date sets a time limit on the Commissioner's power to assign such that a beneficiary not assigned on October 1, 1993 must be left unassigned for life. Under the companies' argument, the challenged assignments are void and the corresponding benefits must be financed by other pension plans and funds. The companies obtained summary judgments, and the Court of Appeals affirmed.

Question 

Is the assignment of beneficiaries, under Coal Industry Retiree Health Benefit Act of 1992, valid if the assignment was made after the Act's October 1, 1993 deadline?

Conclusion 
Decision: 6 votes for Barnhart, 3 vote(s) against
Legal provision: 26 U.S.C. 9701

Yes. In a 6-3 opinion delivered by Justice David H. Souter, the Court held that the Commissioner's initial assignments made after October 1, 1993, are valid despite their untimeliness. The Court reasoned that a statute directing official action needed more than a mandatory "shall" before the grant of power would be read to expire when the job was supposed to be completed. Moreover, Justice Souter noted that the Act was designed to assign the greatest number of beneficiaries and read the statutory date as a spur to prompt action. Justice Antonin Scalia dissented, in which Justices Sandra Day O'Connor and Clarence Thomas joined. Justice Thomas also filed a separate dissenting opinion. Both read the Act has establishing a clear deadline for the expiration of the Commissioner's authority.

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BARNHART v. PEABODY COAL CO.. The Oyez Project at IIT Chicago-Kent College of Law. 20 October 2014. <http://www.oyez.org/cases/2000-2009/2002/2002_01_705>.
BARNHART v. PEABODY COAL CO., The Oyez Project at IIT Chicago-Kent College of Law, http://www.oyez.org/cases/2000-2009/2002/2002_01_705 (last visited October 20, 2014).
"BARNHART v. PEABODY COAL CO.," The Oyez Project at IIT Chicago-Kent College of Law, accessed October 20, 2014, http://www.oyez.org/cases/2000-2009/2002/2002_01_705.