The Justice Department's Antitrust Division Yesterday recommended that the attorney general deny an application by two Tennessee newspapers for temporary exemption from antitrust laws in a joint operating arrangement under the Failing Newspaper Act.

The Chattanooga Times and Chattanooga News-Free Press, which filed for permanent approval on March 24, argued temporary approval was necessary or the Times would fail while the application was being considered. The Justice Department said the newspapers had failed to prove their case.

The joint operating arrangement would combine the printing and commercial operations of the two papers at the facilities of the News-Free Press. News and editorial operations would remain independent.

The Antitrust Division's recommendations on final approval of the application will be filed on May 18.

Meanwhile, in Philadelphia, N. S. Hayden, president and publisher of The Camden (N.J.) Courier-Post, was named president and publisher of The Philadelphia Bulletin. Hayden succeeds Willaim L. McLean III. Gannett Co. Inc., owner of the Courier-Post, named Robert Collins, publisher of the cabin's Tarentum (Pa.) Valley News Dispatch, to succeed Hayden in Camden.

Hayden began his newspaper career in 1959 as a reporter for The Albany Herald in Georgia. He joined the Gannett group in 1972 as president and publisher of the Huntington (W.Va.) Herald Dispatch and the Huntington Advertiser. He became president and publisher of the Oregon Statesman and Capital Journal of Salem in 1976.