302 U.S. 464 (2007), Alabama Power Co. v. Ickes

Citation:302 U.S. 464, 58 S.Ct. 300, 82 L.Ed. 374
Party Name:Alabama Power Co. v. Ickes
Case Date:January 03, 1938
Court:United States Supreme Court

Page 464

302 U.S. 464 (2007)

58 S.Ct. 300, 82 L.Ed. 374

Alabama Power Co.



United States Supreme Court

Jan. 3, 1938




1. An electric power company, operating in Alabama under a nonexclusive franchise, sued to enjoin the performance of agreements whereby a federal official purporting to act under Title II of the National Industrial Recovery Act, as amended, undertook on behalf of the United States to make loans and grants of money to several Alabama municipalities to assist each of them, respectively, in constructing an electrical distribution system within its municipal limits. Held that the company had no standing to question the validity of the loans and grants under the federal statute, or the validity of the statute in that regard under the Federal Constitution, since the only damage threatening the company was the damage of lawful competition -- damnum absque injuria. Pp. 478-479.

According to the findings in the cases, each of the municipalities had authority to construct and operate its proposed plant and distribution system in competition with the company, and to borrow money for that purpose, and had determined to do so of its own free will; no conspiracy was involved, nor any desire to cause injury or financial loss to the company, nor purpose to regulate rates or foster municipal ownership of utilities. Neither the United States nor any of the respondent officers had reserved any right to require an elimination of competition or designate any agency from which the municipality must purchase its power. Each municipality was left entirely free from federal control or direction in respect of the management and control of its plant and business.

2. Findings of the District Court, made after hearing, supported by substantial evidence, and not questioned by the intermediate appellate court, held unassailable in this Court. P. 477.

3. The interest of a taxpayer in the moneys of the federal treasury affords him no status to enjoin expenditures upon the ground that they are for an unconstitutional purpose. P. 478.

Page 465

4. Courts have no power to enjoin the execution of an Act of Congress upon the Ground of unconstitutionality where no wrong directly resulting in the violation of a legal right is presented in a justiciable issue. P. 479.

67 App.D.C. 230, 91 F.2d 303, affirmed.

Certiorari, 301 U.S. 681, to review decrees affirming the dismissal of bills brought against the Emergency Public Works Administrator and other Government officials to restrain the making of loans and grants of money to certain municipalities in Alabama, in aid of the construction of municipal light and power plants. These cases were consolidated and tried with others which later became moot. No. 84 also became moot insofar as it related to three of the municipalities originally named in the bill. The opinion of the District Court is in LXIV Wash.L.Rep. 563.

Page 473

SUTHERLAND, J., lead opinion

MR. JUSTICE SUTHERLAND delivered the opinion of the Court.

These cases involve certain "loan and grant agreements" made by the Federal Emergency Administrator of Public Works with four municipal corporations located in the State of Alabama. The bills of complaint sought to enjoin the execution of these agreements. Each agreement contemplates the construction of an electricity distribution system by the designated municipality, and, to that end, the purchase by the Administrator of bonds to be issued by the municipality and secured by a first pledge of the revenues derived from the operation of the system. In No. 84, thirty, and in No. 85, forty-five, percent of the cost of the labor and materials used in the construction are to be donated outright. The authority relied upon for the loans and grants is that contained in Title II of the National Industrial Recovery Act,1 as modified and continued by the Emergency Relief Appropriation Act of 1935.2 Title I of the former act has been declared unconstitutional by this Court. Schechter Corp. v. United States, 295 U.S. 495; Panama Refining Co. v. Ryan, 293 U.S. 388. But we are here concerned not with Title I,

Page 474

but with Title II, of the act. So far as material, that title provides:

Sec. 202. The Administrator, under the direction of the President, shall prepare a comprehensive program of public works, which shall include, among other things, the following: (a) construction, repair, and improvement of public highways and parkways, public buildings, and any publicly owned instrumentalities and facilities; (b) conservation and development of natural resources, including control, utilization, and purification of waters, prevention of soil or coastal erosion, development of water power, transmission of electrical energy; . . . (c) any projects of the character heretofore constructed or carried on either directly by public authority or with public aid to serve the interests of the general public; (d) construction, reconstruction, alteration, or repair under public regulation or control of low-cost housing and slum clearance projects; (e) any project (other than those included in the foregoing classes) of any character heretofore eligible for loans under subsection (a) of section 201 of the Emergency Relief and Construction Act of 1932, as amended. . . .

Sec. 203. (a) With a view to increasing employment quickly (while reasonably securing any loans made by the United States), the President is authorized and empowered, through the Administrator or through such other agencies as he may designate or create, (1) to construct, finance, or aid in the construction or financing of any public works project included in the program prepared pursuant to section 202; (2) upon such terms as the President shall prescribe, to make grants to States, municipalities, or other public bodies for the construction, repair, or improvement of any such project, but no such grant shall be in excess of 30 [by later act, 45] percentum of the cost of the labor and materials employed upon such project. . . .

Page 475

The bills of complaint challenge the validity of the loans and grants on the grounds, among others, that these statutory provisions purporting to authorize such loans and grants are unconstitutional, and [58 S.Ct. 302] that, in any event, the loans and grants do not come within the statutory provisions.

The injury which petitioner will suffer, it is contended, is the loss of its business as a result of the...

To continue reading