Yosemite Park & Curry Co. v. Collins

• Decision Date: 25 October 1937
• Docket Number: No. 4165.,4165.
• Citation: 20 F. Supp. 1009
• Court: U.S. District Court — Northern District of California
• Parties: YOSEMITE PARK & CURRY CO. v. COLLINS et al., Board of Equalization of California.

20 F. Supp. 1009

YOSEMITE PARK & CURRY CO. v. COLLINS et al., Board of Equalization of California.

No. 4165.

District Court, N. D. California, S. D.

October 25, 1937.

Brobeck, Phleger & Harrison, of San Francisco, Cal., for plaintiff.

Frank J. Hennessy, U. S. Atty., of San Francisco, Cal., amicus curiæ.

U. S. Webb, Atty. Gen., and Seibert L. Sefton, Deputy Atty. Gen., for defendant.

Before WILBUR, Circuit Judge, and ST. SURE and ROCHE, District Judges.

ROCHE, District Judge.

The question in this case deals with the applicability of the "Alcoholic Beverage Control Act of the State of California"¹ in all its taxing, licensing, and policing provisions, to the Yosemite National Park located within the territorial limits of California.

The answer depends upon the respective jurisdictions of the state and the United States over the Park, and this in turn revolves around the methods by which, and the extent to which, the federal government may acquire jurisdiction of lands ceded to it by states for national park purposes. The Supreme Court in Arlington Hotel Co. v. Fant, 278 U.S. 439, 454, 49 S.Ct. 227, 230, 73 L.Ed. 447, characterized the question as novel, saying: "This issue may in the future become a subject of constitutional controversy, because some twenty or more parks have been created by Congress, in a number of which exclusive jurisdiction over the land has been conferred by act of cession of the state. We do not find it necessary, however, now to examine this question."

Briefly, the Beverage Control Act is a complete liquor regulation measure for California.¹ It provides for various licensing fees of importers, retailers, and wholesalers. It has a schedule of excise taxes applicable to the sale of different types of liquors and wines and beers. It has definite provisions for the areas within which liquor may be sold. It gives state officers the right to prescribe the accounting and bookkeeping systems which dealers in liquors must use. It enables the State Board of Equalization, which administers the act, to require liquor dealers to obtain the indorsement of a certain number of property owners in the area where the dealers are to be licensed, and to furnish bond for security of tax collection. It has also many other features which make it extremely comprehensive and which give the State Board of Equalization complete regulatory power.

Plaintiff, the Yosemite Park & Curry Company, is seeking to enjoin the State Board of Equalization and the State Attorney General from enforcing the Beverage Control Act within the Park. Plaintiff is engaged in the operation of hotels, camps, stores, transportation facilities, utilities, and other businesses within the Park. There is a contract between the plaintiff and the Secretary of the Interior leasing portions of the Park to plaintiff for a 20-year term. The intent of the contract is to carry out the congressional desire to make the Park a resort and playground for the benefit of the public (Contract, art. VI (d). The contract places upon plaintiff the duty of furnishing the aforementioned facilities for the accommodation of visitors in the Park. A part of such duty is the sale of liquors, beers, and wines to Park visitors. It is in respect to these alcoholic beverages that the state threatens to take action under its Beverages Control Act. The prices which plaintiff can charge can be established only with the approval of the Secretary of the Interior (Contract, art. VI (e). Plaintiff is limited to an annual 6 per cent. cumulative return upon its investment (Contract, art. VI (b) 2). It must pay to the Secretary of the Interior $5,000 a year as rent for the first 10 years (Contract, art. VI (b) 1). If it earns more than 6 per cent. and declares excess dividends, 25 per cent. of the amount so declared must go to the Secretary of the Interior (Contract, art. VI (b) 6). During the second 10 years, plaintiff is excused from the $5,000 payments and need only pay 22½ per cent. of its excess dividends to the Secretary (Contract, art. VI (c).

Before further detailing the facts of the case, it is necessary to point out that the Park consists of Yosemite Valley plus a great amount of surrounding territory. The Valley has been the subject of statutory cessions different from the balance of the Park (hereafter called the Park as distinguished from the Valley). We therefore shall consider separately the problems presented by the two cessions.

First. The Valley.

All of the area in question, including the entire territory comprising California and many western states, was acquired by the United States from Mexico in 1848 by the Treaty of Guadalupe Hidalgo.² California was admitted to statehood in 1850, the United States reserving its proprietary rights to the Valley and other unappropriated public lands.³ Fort Leavenworth R. R. Co. v. Lowe, 114 U.S. 525, 5 S.Ct. 995, 29 L.Ed. 264; 50 C.J. 887. The Congress gave the Valley to California in trust for public park and recreational purposes June 30, 1864,⁴ thus relinquishing the previously reserved federal proprietary rights. In 1891 California enacted a law⁵ reading: "The State * * * hereby cedes to the United States of America exclusive jurisdiction over such piece or parcel of land as may have been or may hereafter be ceded or conveyed to the United States, during the time the United States shall be or remain the owner thereof, for all purposes except the administration of the criminal laws of this State and the service of civil process therein."

By Act of March 3, 1905 (St.1905, p. 54), the California Legislature did: "hereby re-cede and re-grant unto the United States of America * * * the Yosemite Valley, * * * and the State of California does hereby relinquish unto the United States of America and resign the trusts created and granted" for public park purposes.

The statute further provided: "the same to be held for all time by the United States of America for public use, resort and recreation."

The United States by Act of June 11, 1906,⁶ accepted the re-grant. There are no other statutes pertaining to the Valley, other than the California statute of 1919, hereinafter referred to, ceding jurisdiction to the federal government over the entire Park, which includes the Valley.

The problem now arises, do the recited facts show that exclusive jurisdiction of the Valley is vested in the United States? If they do, of course the state has no right to enforce its liquor laws therein.

We hold that the United States has exclusive jurisdiction of the Valley.

(1) In reference to the statutes granting the Valley to the state and regranting it to the United States, the defendants state at page 5 of their opening brief: "But neither of these acts granted territorial or governmental jurisdiction to the grantee and so may be disregarded."

We agree that the United States had only a proprietary interest in the Valley and that no jurisdiction passed from the United States to California or vice versa by virtue of the Acts of 1864 and 1905 alone. That much is conceded by plaintiff and by the United States. But we are inclined to heed these statutes, for they have a further significance.

The state regranting act of 1905 taken in conjunction with the California statute of 1891 generally ceding exclusive jurisdiction to the United States in all cases of transfer of land, establishes beyond a doubt that exclusive jurisdiction of the Valley is now in the United States.

(2) The state contends that regardless of what has been said, the state Legislature had no power to give up its taxing authority over the Valley. There is no federal constitutional prohibition against such a relinquishment. No state measure forbidding the transfer of jurisdiction has been cited to us. On the contrary, section 33 of the California Political Code provides for such transfers. What is relied upon is a California constitutional provision forbidding the giving away of the taxing power.⁷ In Yellowstone, etc., Co. v. Gallatin County (C.C.A.9) 31 F.(2d) 644, a similar argument was examined and found to be without merit. Defendants have simply misapplied a general rule of state sovereignty to a situation in which the principal issue of territorial jurisdiction controls the right to tax. The Supreme Court, in Standard Oil Co. v. California, 291 U.S. 242, 54 S.Ct. 381, 78 L.Ed. 775, considered the effect of a cession of exclusive jurisdiction over the Presidio in San Francisco by the state to the United States. It was held that the state's right to tax also had been ceded.

(3) It is further argued on behalf of the state that the United States had no power under which it could obtain exclusive jurisdiction of the Valley when the Valley was not purchased with the consent of the state, and was not to be used for the "Erection of Forts, Magazines, Arsenals, Dock-Yards and other needful Buildings," as specified in article 1, § 8, Cl. 17, of the Federal Constitution. It is said in defendants' opening brief (p. 6) that the only manner mentioned in the Constitution for the United States to obtain exclusive jurisdiction of land by the acquisition thereof alone, is that set forth in the quoted clause. The proposition can be conceded, but is far from controlling. We may further concede the next statement made, that, when the federal government acquires land and jurisdiction thereof in any other way than that outlined in article 1, § 8, cl. 17 (in this case by cession), for the purposes mentioned in that clause, the state can make any reservation of jurisdiction it deems desirable short of imposing any conditions inconsistent with the use the United States desires to make of the territory. By the same token, the state can grant exclusive jurisdiction if it fails to impose conditions. As far as the Valley is concerned, that is exactly what occurred. It is sufficient to cite Standard Oil Co. v. California, supra, and Arlington Hotel Co. v. Fant, supra, to the effect that...