321 U.S. 503 (1944), 464, Bowles v. Willingham

Docket Nº:No. 464
Citation:321 U.S. 503, 64 S.Ct. 641, 88 L.Ed. 892
Party Name:Bowles v. Willingham
Case Date:March 27, 1944
Court:United States Supreme Court
 
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Page 503

321 U.S. 503 (1944)

64 S.Ct. 641, 88 L.Ed. 892

Bowles

v.

Willingham

No. 464

United States Supreme Court

March 27, 1944

Argued January 7, 10, 1944

[64 S.Ct. 642] APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES

FOR THE MIDDLE DISTRICT OF GEORGIA

Syllabus

l. Under § 205(a) of the Emergency Price Control Act of 1942 and § 24(1) of the Judicial Code, and in view of § 204(d) of the Act, a federal district court, in a suit by the Administrator, has authority to enjoin a proceeding in a state court to restrain issuance by the Administrator of rent orders, and § 265 of the Judicial Code, forbidding federal courts to enjoin proceedings in state courts, is inapplicable. P. 510.

(a) Congress may determine whether the federal courts should have exclusive jurisdiction of controversies which arise under the Constitution and laws of the United States and which are therefore within the judicial power of the United States as defined in Art. III, § 2 of the Constitution, or whether they should exercise that jurisdiction concurrently with the courts of the States. P. 511.

(b) The authority of Congress to withhold from state courts all jurisdiction of controversies arising under the Constitution and laws of the United States includes the power to restrict the occasions when that jurisdiction may be invoked. P. 512.

Page 504

2. By the rent control provisions of the Emergency Price Control Act of 1942, authorizing the Price Administrator to fix maximum rents for housing accommodations in defense rental areas, Congress did not delegate its legislative power. Yakus v. United States, ante, p. 414. P. 514.

The standards prescribed by the Act are adequate for the judicial review which is afforded. The fact that there is a one for the exercise of discretion by the Administrator is no more fatal here than in other situations where Congress has prescribed the general standard and has left to an administrative agency the determination of the precise situations to which the provisions of the Act will be applied and the weight to be accorded various statutory criteria on given facts.

3. The requirement that the maximum rent or rents established by the Administrator be "generally" fair and equitable, § 2(b), does not render the Act violative of the Fifth Amendment. P. 516.

(a) That price-fixing is on a class basis, rather than on an individual basis, does not render it invalid. P. 518.

(b) The restraints imposed on the national government in this regard by the Fifth Amendment are no greater than those imposed on the States by the Fourteenth. P. 518.

(c) Congress was dealing here with conditions created by activities resulting from a great war effort; it was under no constitutional necessity of providing a system of price control which would assure each landlord a "fair return" on his property. P. 519.

(d) And though the legislation may have reduced the value of the property being regulated, there was no "taking" of it. P. 517.

4. That landlords are not afforded a hearing before the order or regulation fixing rents becomes effective does not render the Act violative of the Fifth Amendment. Provision for judicial review after the order or regulation become effective satisfies the requirements of due process under these circumstances. P. 519.

5. Questions as to the validity of orders or regulations issued pursuant to the Act may be considered only by the Emergency Court of Appeals on the review provided by § 204. P. 521.

Reversed.

Direct appeal from an order of the District Court dismissing a suit by the Price Administrator on the ground of the unconstitutionality of the rent provisions of the Emergency Price Control Act of 1942 and regulations promulgated pursuant thereto.

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DOUGLAS, J., lead opinion

MR. JUSTICE DOUGLAS delivered the opinion of the Court.

Appellee, Mrs. Willingham of Macon, Georgia, sued in a Georgia court to restrain the issuance of certain rent orders under the Emergency Price Control Act of [64 S.Ct. 643] 1942, 56 Stat. 23, 50 U.S.C. App. (Supp.II) § 901 et seq., on the ground that the orders and the statutory provisions on which they rested were unconstitutional. The state court issued, ex parte, a temporary injunction and a show cause order. Thereupon, appellant, Administrator of the Office of Price Administration, brought this suit in the federal District Court pursuant to § 205(a) of the Act and § 24(1) of the Judicial Code, to restrain Mrs. Willingham from further prosecution of the state proceedings and from violation of the Act, and to restrain appellee Hicks, Bibb County sheriff, from executing or attempting to execute any orders in the state proceedings. The District Court, 51 F.Supp. 597, in reliance on its earlier ruling in Payne v. Griffin, 51 F.Supp. 588, dismissed the Administrator's suit on bill and answer, holding that the orders in question and the provisions of the Act on which they rested were unconstitutional. The case is here on direct appeal. 50 Stat. 752, 28 U.S.C. § 349a.

Sec. 2(b) of the Act provides in part that,

Whenever in the judgment of the Administrator such action is necessary or proper in order to effectuate the purposes of this Act, he shall issue a declaration setting forth the necessity

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for, and recommendations with reference to, the stabilization or reduction of rents for any defense area housing accommodations within a particular defense rental area.

Pursuant to that authority, the Administrator, on April 28, 1942, issued a declaration designating twenty-eight areas in various parts of the country, including Macon, Georgia, as defense rental areas. 7 Fed.Reg. 3193. That declaration stated that defense activities had resulted in increased housing rents in those areas,1 and that it was necessary and proper, in order to effectuate the purposes of the Act, to stabilize and reduce such rents. It also contained a recommendation pursuant to § 2(b) that the maximum rent for housing accommodations rented on April 1, 1941, should be the rental for such accommodations on that date,2 and that, in case of accommodations

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not rented on [64 S.Ct. 644] April 1, 1941, or constructed thereafter provisions for the determination, adjustment, and modification of maximum rents should be made, such rents to be in principle no greater than the generally prevailing rents in the particular area on April 1, 1941. The declaration also stated, in accordance with the provisions of § 2(b),3 that if, within sixty days after April 28, 1942, such rents within the areas in question had not been

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stabilized or reduced by state or local regulation or otherwise in accordance with the Administrator's recommendation, the Administrator might fix the maximum rents.

On June 30, 1942, the Administrator issued Maximum Rent Regulation No. 26, effective July 1, 1942, establishing the maximum legal rents for housing in these defense areas, including Macon, Georgia. 7 Fed.Reg. 4905. It recited that the rentals had not been reduced or stabilized since the declaration of April 28, 1942, and that defense activities had resulted in increases in the rentals on or about April 1, 1941, but not prior to that date. The maximum rentals fixed for housing accommodations rented on April 1, 1941, were the rents obtained on that date. § 1388.1704(a). As respects housing accommodations not rented on April 1, 1941, but rented for the first time between that date and the effective date of the regulation, July 1, 1942 -- the situation involved in this case -- it was provided that the maximum rent should be the first rent charged after April 1, 1941. § 1388.1704(c). But, in that case, it was provided that the Rent Director (designated by § 1388.1713) might order a decrease on his own initiative on the ground, among others, that the rent was higher than that generally prevailing in the area for comparable housing accommodations on April 1, 1941. § 1388.1704(c), § 1388.1705(c)(1). By Procedural Regulation No. 3, as amended (8 Fed.Reg. 526, 1798, 3534, 5481, 14811) issued pursuant to § 201(d) and § 203(a) of the Act4 provision was made that, when the Rent Director

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proposed to take such action he should serve a notice upon the landlord involved, stating the proposed action and the grounds therefor. § 1300.207. Within 60 days of the final action of the Rent Director, the landlord might file an application for review by the regional administrator for the region in which the defense rental area office was located, and then file a protest with the Administrator for review of [64 S.Ct. 645] the action of the regional office (§ 1300.209, § 1300.210); or he might proceed by protest immediately. § 1300.209, § 1300.215. As we develop more fully hereafter, the Act provides in § 203(a) for the filing of protests with the Administrator. The machinery for a hearing on a protest and a determination of the issue by the Administrator (§ 1300.215-§ 1300.240) was designed to provide the basis of judicial review by the Emergency Court of Appeals as authorized by § 204(a) of the Act.

In June, 1943, the Rent Director gave written notice to Mrs. Willingham that he proposed to decrease the maximum rents for three apartments owned by her, and which had not been rented on April 1, 1941, but were first rented in the summer of 1941, on the ground that the first rents for these apartments received after April 1, 1941, were in excess of those generally prevailing in the area for comparable accommodations on April 1, 1941. Mrs. Willingham filed objections to that proposed action, together with supporting affidavits. The Rent Director thereupon advised

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her that he would proceed to issue an order reducing the rents. Before that was done, she filed her bill in the...

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