(dissenting). I dissent and vote for affirmance. By the decision about to be made herein, a majority of the court recognizes that the appellant has the unrestricted power to transfer its contribution rate credits to a person or party not meeting the statutory definition of a “qualified” employer and this in face of the clear consequence that such a transfer will not only be detrimental to the administration of the fund as a whole but will deprive other ‘ ‘ qualified ’ ’ employers of their inherent right to have the protection of as great a total amount of credits as possible. I am sure the Legislature never intended to place such a “windfall ” asset at the unrestricted disposal of a transferring employer or, to put it another way, to empower a “ qualified ” employer to confer a benefit upon other than a “ qualified ” successor.
The appeal challenges an administrative determination. This, by a well-recognized rule of review, we are to accept if there be “ warrant in the record ” and a “ reasonable basis in law ” for the action taken (Red Hook Cold Storage Co. v. Department of Labor, 295 N. Y. 1, 9; Rochester Tel. Corp. v. United States, 307 U. S. 125). We are all in agreement with the courts below that, if the commissioner’s rule 3 is valid, this dual test has been satisfied as there is proof in the record that Federal did not transfer all or substantially all of its assets to Laboratories and did not discontinue operations following such transfer. In the majority view, however, rule 3 — particularly in paragraphs (1) and (2) of subdivision b thereof — expresses substantive rather than procedural standards and, as such, represents therefore an unauthorized assumption of legislative prerogatives by the commissioner as he has, quite apparently, predicated his rule on that subdivision of the statute (Labor Law [Unemployment Insurance Law], § 577, subd. 1, par. [d]) which defined an employer qualified in the first instance to receive contribution rate credits: Subdivision 4, relating to credit transfers, is silent as to qualifications beyond authorizing “ such rules as the commissioner may prescribe ” (Labor Law,, § 577, subd. 4).
Absent a showing to the contrary, we should presume that,, prior to promulgating rule 3, the commissioner satisfied himself as to the legislative scheme by a reading of the entire statute and that he designed the rules setting forth the admin*101istrative procedures called for by the statute to reflect reasonably its intent and purpose. In prescribing rule 3 to govern credit transfers therefore, he merely reiterated the statutory definition for a “qualified employer”, stating that (1) the acquiring employer must have acquired all or substantially all of the assets of the transferring employer and that (2) the transferring employer must discontinue operations. In short, he saw a necessary relation between the original earning of credits and the ability to take such credits from one who had earned them. Yet a majority is about to say that such a rule has no reasonable basis in law and is improper.
I am unable to agree that this is such an innovation or departure from the statute as to amount to the creation of unauthorized substantive standards. The statute, when read as a whole, offers a comprehensive scheme for the earning — and the incidental transfer — of contribution rate credits. By looking to the earning requirements as indicative of the status of an employer to receive these credits, the rule adopted by the commissioner introduces no new element, nor does it in any way impinge upon the overall legislative program. I find it strange, indeed, to interpret the statute as prohibiting the application of standards set up for a qualified employer to a successor employer, particularly when the statute, in defining a qualified employer, declared that both qualified and successor employers “ shall be jointly considered for all purposes of this section.” (Emphasis supplied.) (§ 577, subd. 1, par. [d].) Furthermore we may note that, by a recent amendment, the Legislature has given an unconditional indorsement to the view of the commissioner by adopting in the statute precisely those standards previously incorporated in rule 3 (L. 1947, ch. 780). This situation has, thus, been corrected for the future.
As I regard it then, the construction placed upon the law, as it then existed, was entirely reasonable and well within the administrative discretion conveyed by the grant of rule-making powers. While recognizing that problems of statutory construction are primarily for the courts, I nevertheless believe it well established that this function of the court is somewhat limited when the question involved turns upon the application of a broad statutory phrase by an administrative agency (see National Labor Relations Bd. v. Hearst Publications, 322 U. S. *102111, 131). We have said on another occasion: “ it is not always necessary that license legislation prescribe a specific rule of action. Where it is difficult or impractical for the Legislature to lay down a definite, comprehensive rule, a reasonable amount of discretion may be delegated to the administrative officials. (New York ex rel. Lieberman v. Van De Carr, 199 U. S. 552, affg. 175 N. Y. 440.) Where the administrative agency has adopted a standard as an interpretation of the broad powers granted to it by the statute, we may declare such a standard invalid only in the event that it is so lacking in reason for its promulgation that it is essentially arbitrary.” (Matter of Marburg v. Cole, 286 N. Y. 202, 211-212.)
Nor can I see any necessary or compelling similarity to the statute examined in Packer Collegiate Inst. v. University of State of N. Y. (298 N. Y. 184, 189) where “ Only the wildest guessing could give us any idea of what the Legislature had in mind.” The statute in Matter of Levine v. O’Connell (300 N. Y. 658) was similarly so unlike that here considered as to make it inapplicable to this case. Here we have a precise statutory definition of an employer “ qualified ” to earn credits and an overall scheme for the transfer of such credits as are earned.
On at least one prior occasion we have refused to review and thus perhaps impliedly upheld the commissioner’s right to set up the standards of paragraph (d) of subdivision 1 to govern the transfer of credits under subdivision 4 (Matter of Hinzmann & Waldmann [Corsi], 274 App. Div. 1009, motion for leave to appeal denied 300 N. Y. 761). While that case turned on a definition of gross as opposed to net assets — a somewhat different proposition than here but resulting in a disallowance of the credit — the decision was implicit with the same reasoning.
Rule 3, then, should not be condemned simply because it incorporates as a part thereof what may be characterized as “ substantive standards ” when such standards are drawn verbatim from the express statutory language and, when construed as a whole, are found to be in complete harmony with the legislative scheme. It is only where no “ reasonable basis in law ” can be discovered — where, in other words, the statute provides no criteria to guide the administrator in the exercise of rule-making powers — that a regulation promulgated there*103under is to be stricken (Matter of Levine v. O’Connell, supra; Packer Collegiate Inst. v. University of State of N. Y., supra; cf. Schechter Poultry Corp. v. United States, 295 U. S. 495). When rule 3 is so viewed there is ample basis in the law for its acceptance.
The order appealed from should be affirmed.
Loughran, Ch. J., Lewis, Conway, Desmond and Fuld, JJ., concur with Froessel, J.; Dye, J., dissents in opinion.
Order reversed, etc.