251 U.S. 146 (1919), 589, Hamilton v. Kentucky Distilleries & Warehouse Company

Docket Nº:No. 589, 602
Citation:251 U.S. 146, 40 S.Ct. 106, 64 L.Ed. 194
Party Name:Hamilton v. Kentucky Distilleries & Warehouse Company
Case Date:December 15, 1919
Court:United States Supreme Court
 
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Page 146

251 U.S. 146 (1919)

40 S.Ct. 106, 64 L.Ed. 194

Hamilton

v.

Kentucky Distilleries & Warehouse Company

No. 589, 602

United States Supreme Court

Dec. 15, 1919

Argued November 20, 1919

APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES

FOR THE WESTERN DISTRICT OF KENTUCKY

Syllabus

The power to prohibit the liquor traffic as a means of increasing war efficiency is part of the war power of Congress, and its exercise without providing for compensation is no more limited by the Fifth Amendment than a like exercise of a state's police power would be limited by the Fourteenth Amendment. P. 164.

The War-Time Prohibition Act, approved ten days after the armistice with Germany was signed, Act of November 21, 1918, c. 212, 40 Stat. 1046, provided:

That after June thirtieth, nineteen hundred and nineteen, until the conclusion of the present war and thereafter until the termination of demobilization, the date of which hall be determined and proclaimed by the President of the United States, for the purpose of conserving the manpower of the Nation, and to increase efficiency in the production of arms, munitions, ships, food, and clothing for the Army and Navy, it shall be unlawful to sell for beverage purposes any distilled spirits, and during said time no distilled spirits held in bond shall be removed therefrom for beverage purposes except for export.

Held, in respect of liquors in bond, even if belonging to one who made and owned them before the

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act was passed and paid revenue taxes upon them since June 30, 1919: .

(1) That the act was not an appropriation of such liquors for public purposes. P. 157.

(2) That the time allowed for disposing of all liquors in bond on November 21, 1918, could not be declared unreasonable as a matter of law, even if they were not sufficiently ripened or aged to be disposed of advantageously during the period limited. P. 158.

(3) That the prohibition was not in violation of the Fifth Amendment as a taking of property without compensation. P. 157.

(4) That it was within the war power when passed (notwithstanding the cessation of hostilities under the armistice) as a means of war efficiency and for the support and care of the Army and Navy during demobilization. P. 158.

A wide latitude of discretion must be accorded to Congress in the exercise of the war powers. P. 163.

The court cannot inquire into the motives of Congress, in determining the validity of its acts, or into the wisdom of the legislation, nor pass upon the necessity for the exercise of a power possessed. P. 161.

It is settled that the war power carries with it the power to guard against immediate renewal of the conflict and to remedy the evils which have arisen from its rise and progress. Id.

Assuming that the continuing validity of an act passed under the war power may depend not upon the existence of a technical state of war, terminable only with the ratification of a treaty of peace or by a proclamation of peace, but upon some actual war emergency or necessity, the Court cannot say that the necessity for the prohibition had ceased when these suits were begun in view of the facts that the treaty of peace has not been concluded, that various war activities -- among them, national control of railroads -- continue, and that the manpower of the nation has not been completely restored to a peace footing. P. 161.

The Eighteenth Amendment did not operate to repeal the War-Time Prohibition Act. P. 163.

In defining the period of the prohibition, Congress, in the War-Time Prohibition Act, doubtless expecting that the war would be definitely ended by a peace under a ratified treaty or a proclamation before demobilization was complete, intended that the prohibition should continue until the date of the termination of demobilization had been definitely ascertained by the President and made known by him through a proclamation to that end. P. 164.

The reference to the "demobilization of the army and navy" in the

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President's message communicating his veto of the National Prohibition Act, is not the proclamation required by the War-Time Prohibition Act. P. 167.

In an exact sense, demobilization had not terminated then or when these suits were begun, as shown by the report on the subject of the Secretary of War, made to the President and transmitted to Congress; nor does it appear that it has yet so terminated. P. 168.

No. 589, reversed.

No. 602, affirmed.

The cases are stated in the opinion.

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BRANDEIS, J., lead opinion

MR. JUSTICE BRANDEIS delivered the opinion of the Court.

The armistice with Germany was signed November 11, 1918. Thereafter, Congress passed, and on November 21, 1918, the President approved the War-Time Prohibition Act (c. 212, 40 Stat. 1045, 1046), which provides as follows:

That after June thirtieth, nineteen hundred and nineteen, until the conclusion of the present war and thereafter until the termination of demobilization, the date of which shall be determined and proclaimed by the President of the United States, for the purpose of conserving the manpower of the Nation, and to increase efficiency in the production of arms, munitions, ships, food, and clothing for the army and navy, it shall be unlawful to sell for beverage purposes any distilled spirits, and during said time no distilled spirits held in bond shall be removed therefrom for beverage purposes except for export. . . .

On October 10, 1919, the Kentucky Distilleries & Warehouse Company, owner of distillery warehouses and of whisky therein, brought in the district court of the United States for the Western District of Kentucky a suit against Hamilton, collector of internal revenue for that district, alleging that the above act was void or had become inoperative, and praying that he be enjoined from interfering, by reason of that act, with the usual process of

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withdrawal, distribution, and sale of the whisky in bond. The case was heard before the district judge on plaintiff's motion for a preliminary injunction and defendant's motion to dismiss. A decision without opinion was rendered for the plaintiff, and, the defendant declining to plead further, a final decree was entered granting a permanent injunction in accordance with the prayer of the bill. A similar suit seeking like relief was brought on October 29, 1919, by Dryfoos, Blum & Co., in the District Court of the United States for the Southern District of New York, against Edwards, collector for that district. That case was heard on November 5 before the district judge on like motions for a preliminary injunction and to dismiss. An opinion was filed November 14, 1919, holding the act in force, and on the following day a final decree was entered dismissing the bill.

The essential facts in the two cases differ in this: in the Kentucky case, the whisky was stored in a distillery warehouse; the plaintiff was the maker of the whisky, had owned it prior to the passage of the act, and had, since June 30, 1919, paid the revenue tax on part of it. In the New York case, the liquors were in general and special bonded warehouses, the plaintiffs were jobbers, and it does not appear when they became the owners of the liquors. Both cases come here by direct appeal under § 238 of the Judicial Code, were argued on the same day, and may be disposed of together. Four contentions are made in support of the relief prayed for: (1) that the act was void when enacted because it violated the Fifth Amendment; (2) that it became void before these suits were brought by reason of the passing of the war emergency; (3) that it was abrogated or repealed by the Eighteenth Amendment; (4) that, by its own terms, it expired before the commencement of these suits. These contentions will be considered in their order.

First. Is the act void because it takes private property

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for public purposes without compensation in violation of the Fifth Amendment? The contention is this: the Constitution did not confer police power upon Congress. Its power to regulate the liquor traffic must therefore be sought for in the implied war powers -- that is, the power "to make all laws . . . necessary and proper for carrying into execution" the war powers expressly granted. Article I, § 8, cl. 18. Congress might under this implied power [40 S.Ct. 108] temporarily regulate the sale of liquor and, if reasonably necessary, forbid its sale in order to guard and promote the efficiency of the men composing the army and the navy and of the workers engaged in supplying them with arms, munitions, transportation and supplies. McKinley v. United States, 249 U.S. 397, 399. But the exercise of the war powers is (except in respect to property destroyed by military operations, United States v. Pacific Railroad, 120 U.S. 227, 239) subject to the Fifth Amendment. United States v. Russell, 13 Wall. 623, 627. The severe restriction imposed by the act upon the disposition of liquors amounts to a taking of property, and, being uncompensated, would, at least as applied to liquors acquired before the passage of the act, exceed even the restriction held to be admissible under the broad police powers possessed by the states. Therefore, since it fails to make provision for compensation, which in every other instance Congress made when authorizing the taking or use of property for war purposes,1 it is void. Such is the argument of the plaintiffs below.

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That the United States lacks...

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