Barnett v. Bowles

• Citation: 151 F.2d 77
• Decision Date: 29 August 1945
• Docket Number: 210.,No. 187,187
• Court: U.S. Temporary Emergency Court of Appeals
• Parties: BARNETT et al. v. BOWLES, Price Administrator. SPIERS v. SAME.

151 F.2d 77 (1945)

BARNETT et al. v. BOWLES, Price Administrator. SPIERS v. SAME.

Nos. 187, 210.

United States Emergency Court of Appeals.

Heard April 4, 1945.

Decided August 29, 1945.

Writ of Certiorari Denied November 13, 1945.

Charles B. Cameron and Victor W. Gilbert, both of Meridian, Miss., for Barnett complainants.

T. J. Wills and Dick Wooten, both of Hattiesburg, Miss., and Henry Mounger, of Columbia, Miss., for complainant Spiers.

John O. Honnold, Jr., Sp. Asst. to Associate Gen. Counsel, Office of Price Administration, of Washington, D. C. (Richard H. Field, Gen. Counsel, and Nathaniel L. Nathanson, Associate Gen. Counsel, and Betty L. Brown, Atty., all of the Office of

Price Administration, all of Washington, D. C., on the brief), for respondent.

Before MARIS, Chief Judge, and MAGRUDER and McALLISTER, Judges.

Heard at Biloxi, Miss., April 4, 1945.

Writ of Certiorari Denied November 13, 1945. See 66 S.Ct. 168.

McALLISTER, Judge.

These two cases present a common question: Whether the Price Administrator has authority to issue a maximum price regulation applicable to sales of intoxicating liquors in the state of Mississippi. Complainants in both cases have been indicted for selling liquor above the maximum prices established by Maximum Price Regulation No. 445. Spiers filed a petition with this Court to vacate the Administrator's order of denial of his protest, challenging the validity of the regulation in question. The Barnett complainants, after their indictments, arraignments and pleas, filed application in the District Court of the United States for the Eastern Division of the Southern District of Mississippi, for leave to file complaint against the Administrator in the United States Emergency Court of Appeals pursuant to Section 204 (e) of the Emergency Price Control Act, 50 U.S.C.A.Appendix § 924(e). Leave was granted and a complaint asking this Court to declare the regulation establishing maximum prices for intoxicating liquors in Mississippi invalid was thereafter accordingly filed. It is with these two complaints, filed by Spiers and by the Barnetts, that we are here concerned.

Before discussing the arguments of complainants, and at the outset of our consideration of the legal proposition submitted for determination, it should be stated that pursuant to the Twenty-First Amendment to the Federal Constitution, the State of Mississippi has enacted laws prohibiting the sale, importation, manufacture or use of intoxicating liquors for beverage purposes, and has declared that all property rights in such liquors were abolished.

The contentions of complainants may be summarized as follows: That the Twenty-First Amendment to the United States Constitution precludes Congress from regulating the sale of intoxicating liquor in the State of Mississippi; that it was the intention of Congress to exclude from the scope of the Emergency Price Control Act all control over the price of intoxicating liquor which is contraband under state law; and that the application of maximum price regulations to the sale of intoxicating liquors in the state of Mississippi would operate as an authorization of the sale of liquor in that state at such maximum prices.

With respect to the last contention above-mentioned, complainants say that if the maximum prices on intoxicating liquor are given effect in Mississippi, the result would be that liquor could be sold there in accordance with such prices. In this regard it is pointed out that in the Emergency Price Control Act, "maximum price" is defined as "maximum lawful price." Sec. 302(i), 50 U.S.C.A.Appendix § 942(i). It is submitted that Congress thereby intended to "prohibit the extension of a maximum price" to the sale of intoxicating liquor in a dry state, since, if there can be no maximum price unless it is a "maximum lawful price" there can be no maximum prices for the sale of liquor in a state where such sale is unlawful.

From the foregoing it is argued that the maximum price regulations in question, as applied to the sale of liquor in the state of Mississippi, are in contravention of the state prohibition laws, and Section 2 of the Twenty-first Amendment to the Federal Constitution, which provides: "The transportation or importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited." Finally, it is urged that, in no event, may maximum prices for intoxicating liquors be established for the state of Mississippi in view of the fact that there was during the period October 1-15, 1941, no legal market price existent, to which the Price Administrator could refer, in ascertaining prevailing prices within the meaning of Section 2(a) of the Emergency Price Control Act, 50 U.S.C.A. Appendix § 902(a).

Contentions that the Twenty-first Amendment bars price control of intoxicating liquors under the Emergency Price Control Act have heretofore been disposed of, and rejected, in the case of Jatros v. Bowles, 6 Cir., 143 F.2d 453, wherein, after declaring that although the states are free under the Twenty-First Amendment to enact laws concerning the transportation within, or the importation into the state of alcoholic beverages, unfettered by the power delegated to the federal government to regulate commerce among the states and with foreign powers, it was declared that, nevertheless, the Amendment did not deprive the national government of all authority to legislate in respect of interstate commerce in intoxicants. With regard to the power of the Price Administrator to establish maximum prices of intoxicating liquors, the Court said that "the Price Control Act rests upon the war power. The Congress has constitutional authority to prescribe commodity prices as a war emergency measure * * *, and the Act was adopted in the exercise of that power. Neither expressly nor by implication was the war power abrogated or limited by the Twenty-first Amendment. Certainly, if there was power to impose national prohibition during war in 1918 there is power to invoke regulations to prevent war-time inflation and its disruptive causes and effects in 1944." 143 F.2d at page 455.

Referring to complainants' assertion that the price control regulation as applied to intoxicating liquors in Mississippi conflicts with the state prohibition law, which by virtue of the Twenty-first Amendment must be deemed to be here controlling, we are unable to discern any inconsistency between the establishing by the federal government, in the exercise of its war powers, of maximum prices on intoxicating liquor that is illegally sold in Mississippi, and the prohibition of its sale by the law of the state. The constitutional Amendment, insofar as here applicable, simply provides that the transportation or importation of intoxicating liquors into any state for delivery or use therein, in violation of state laws, is prohibited. The Emergency Price Control Act does not authorize or purport to authorize the sale or transportation or importation for delivery or use of intoxicating liquors into any state in violation of state laws. We find here no conflict in the operation of state and national regulation of intoxicating liquors. The establishing of maximum prices on liquor in Mississippi does not nullify the state law or legalize the sale of intoxicating liquors in that state. Rather, it is limited only to declaring that if intoxicating liquors are sold in any state — either where such sales are permitted or where they are prohibited — then they cannot be sold above the established maximum prices without incurring the penalties provided for violation of the Act. Under the price regulations, there is no attempt to authorize any transaction which is contrary to state laws, and there is no implication or intimation in the Emergency Price Control Act or the regulations, that the states are not free to adopt their own regulations prohibiting the sales of any commodities which they would otherwise be constitutionally empowered to prohibit.

With respect to the argument that under Section 302(i) of the Act, "maximum price" is defined as "maximum lawful price" and that therefore Congress must have intended that the Price Administrator should only establish maximum prices for lawful sales of commodities — thereby precluding him from establishing maximum prices for unlawful sales, such as the sale of intoxicating liquor in states where such sales are prohibited, we find such contention to be without merit.

The provisions of the Act are directed to a plan of establishing price control over commodities in a time of national emergency, with penalties provided for making sales above the maximum prices established by the Administrator. "Maximum lawful prices" must be deemed to refer to those prices which are lawful under the Act, or, as expressed in other words, to prices for sales which may be made without incurring the penalties imposed for violation of the Act. To adopt the alternative construction of the phrase, which is urged by complainants, we would be required to interpret "maximum lawful prices" as meaning the maximum prices which are lawful under the laws of Mississippi. For, as previously mentioned, complainants say that there can be no maximum lawful price for the sale of intoxicating liquor, where such sale is unlawful — unless it is attempted on the part of the federal government to make the sale of intoxicating liquor in Mississippi lawful under price control, in opposition to the state law.

Were such a construction to be followed, it would result that non-compliance with the state statutes or ordinances regulating the sales of commodities — such as sales on Sunday, sales without the required licenses, sales of certain drugs without...